-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, IlRdGhi3pNBYLb6ou6SBHSh07HSrEbZRGIrlg1ZNkoUmaf6yngtLOMcBZ+HRGt7d XbyqlqZ7VaYm+tHFikg7ag== 0000904454-05-000391.txt : 20050901 0000904454-05-000391.hdr.sgml : 20050901 20050901165240 ACCESSION NUMBER: 0000904454-05-000391 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 2 FILED AS OF DATE: 20050901 DATE AS OF CHANGE: 20050901 SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: MTM Technologies, Inc. CENTRAL INDEX KEY: 0000906282 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-COMPUTER INTEGRATED SYSTEMS DESIGN [7373] IRS NUMBER: 133354896 STATE OF INCORPORATION: NY FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-48499 FILM NUMBER: 051065195 BUSINESS ADDRESS: STREET 1: 850 CANAL STREET CITY: STAMFORD STATE: CT ZIP: 06902 BUSINESS PHONE: 2039753700 MAIL ADDRESS: STREET 1: 850 CANAL STREET CITY: STAMFORD STATE: CT ZIP: 06902 FORMER COMPANY: FORMER CONFORMED NAME: MICROS TO MAINFRAMES INC DATE OF NAME CHANGE: 19930527 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: CONSTELLATION VENTURE CAPITAL II LP CENTRAL INDEX KEY: 0001115990 IRS NUMBER: 000000000 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: 575 LEXINGTON AVE CITY: NEW YORK STATE: NY ZIP: 10022 SC 13D/A 1 s13d-090105mtm.txt SCHEDULE 13D/A -- AMENDMENT NO. 2 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 SCHEDULE 13D (Rule 13d-101) INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT TO RULES 13D-1(a) AND AMENDMENTS THERETO FILED PURSUANT TO RULE 13D-2(a) (Amendment No. 2) (1) MTM TECHNOLOGIES, INC. ------------------------------------------------------------------------------- (Name of Issuer) Common Stock, par value $0.001 per share ------------------------------------------------------------------------------- (Title of Class of Securities) 594944 10 0 ------------------------------------------------------------------------------- (CUSIP number) Bear Stearns Asset Management Inc. Ropes & Gray LLP 383 Madison Avenue 45 Rockefeller Plaza New York, New York 10179 New York, New York 10111 (212) 272-9256 (212 841-5700 Attention: Thomas Wasserman Attention: Kristopher D. Brown, Esq. - -------------------------------------------------------------------------------- (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications) August 16, 2005 ------------------------------------------------------------------------------- (Dates of Event which Requires Filing of this Statement) If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of ss.ss. 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box. |_| Note. Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See ss.240.13d-7 for other parties to whom copies are to be sent. - ------------------------------ (1) The remainder of this cover page shall be filled out for a reporting person's initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page. The information required on the remainder of this cover page shall not be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934 ("Act") or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes). CUSIP No. 594944 10 0 Page 2 of 10 Pages - ------------------------------------------------------------------------------- 1. Name of Reporting Person I.R.S. Identification No. of Above Person (Entities Only) Constellation Venture Capital II, L.P. 13-4124531 - ------------------------------------------------------------------------------- 2. Check the Appropriate Box if a Member of a Group (a) |X| ------------------------------------------------------------------- (b) |_| - ------------------------------------------------------------------------------- 3. SEC Use Only - ------------------------------------------------------------------------------- 4. Source of Funds Not Applicable - ------------------------------------------------------------------------------- 5. Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d) or 2(e) |_| - ------------------------------------------------------------------------------- 6. Citizenship or Place of Organization Delaware - ------------------------------------------------------------------------------- 7. Sole Voting Power NUMBER OF 2,791,431 shares of Common Stock SHARES BENEFICIALLY --------------------------------------------------- OWNED BY EACH 8. Shared Voting Power REPORTING PERSON --------------------------------------------------- WITH 9. Sole Dispositive Power 2,791,431 shares of Common Stock --------------------------------------------------- 10. Shared Dispositive Power - ------------------------------------------------------------------------------- 11. Aggregate Amount Beneficially Owned by Each Reporting Person 2,791,431 shares of Common Stock - ------------------------------------------------------------------------------- 12. Check If The Aggregate Amount In Row (11) Excludes Certain Shares |_| - ------------------------------------------------------------------------------- 13. Percent Of Class Represented By Amount In Row (11) 27.4 % - ------------------------------------------------------------------------------- 14. Type of Reporting Person PN - ------------------------------------------------------------------------------- CUSIP No. 594944 10 0 Page 3 of 10 Pages - ------------------------------------------------------------------------------ 1. Name of Reporting Person I.R.S. Identification No. of Above Person (Entities Only) Constellation Venture Capital Offshore, L.P. N/A - ------------------------------------------------------------------------------- 2. Check the Appropriate Box if a Member of a Group (a) |X| ------------------------------------------------------------------- (b) |_| - ------------------------------------------------------------------------------- 3. SEC Use Only - ------------------------------------------------------------------------------- 4. Source of Funds Not Applicable - ------------------------------------------------------------------------------- 5. Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d) or 2(e) |_| - ------------------------------------------------------------------------------- 6. Citizenship or Place of Organization Cayman Islands - ------------------------------------------------------------------------------- 7. Sole Voting Power NUMBER OF 1,485,469 shares of Common Stock SHARES BENEFICIALLY --------------------------------------------------- OWNED BY EACH 8. Shared Voting Power REPORTING PERSON --------------------------------------------------- WITH 9. Sole Dispositive Power 1,485,469 shares of Common Stock --------------------------------------------------- 10. Shared Dispositive Power - ------------------------------------------------------------------------------- 11. Aggregate Amount Beneficially Owned by Each Reporting Person 1,485,469 shares of Common Stock - ------------------------------------------------------------------------------- 12. Check if The Aggregate Amount in Row (11) Excludes Certain Shares |_| - ------------------------------------------------------------------------------- 13. Percent Of Class Represented By Amount In Row (11) 16.7% - ------------------------------------------------------------------------------- 14. Type of Reporting Person PN - ------------------------------------------------------------------------------- CUSIP No. 594944 10 0 Page 4 of 10 Pages - ------------------------------------------------------------------------------- 1. Name of Reporting Person I.R.S. Identification No. of Above Person (Entities Only) The BSC Employee Fund VI, L.P. 20-0778563 - ------------------------------------------------------------------------------- 2. Check the Appropriate Box if a Member of a Group (a) |X| ------------------------------------------------------------------- (b) |_| - ------------------------------------------------------------------------------- 3. SEC Use Only - ------------------------------------------------------------------------------- 4. Source of Funds Not Applicable - ------------------------------------------------------------------------------- 5. Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d) or 2(e) |_| - ------------------------------------------------------------------------------- 6. Citizenship or Place of Organization Delaware - ------------------------------------------------------------------------------- 7. Sole Voting Power NUMBER OF 1,244,803 shares of Common Stock SHARES BENEFICIALLY --------------------------------------------------- OWNED BY EACH 8. Shared Voting Power REPORTING PERSON --------------------------------------------------- WITH 9. Sole Dispositive Power 1,244,803 shares of Common Stock --------------------------------------------------- 10. Shared Dispositive Power - ------------------------------------------------------------------------------- 11. Aggregate Amount Beneficially Owned by Each Reporting Person 1,244,803 shares of Common Stock - ------------------------------------------------------------------------------- 12. Check if The Aggregate Amount in Row (11) Excludes Certain Shares |_| - ------------------------------------------------------------------------------- 13. Percent Of Class Represented By Amount In Row (11) 14.4% - ------------------------------------------------------------------------------- 14. Type of Reporting Person PN - ------------------------------------------------------------------------------- CUSIP No. 594944 10 0 Page 5 of 10 Pages - --------- --------------------------------------------------------------------- 1. Name of Reporting Person I.R.S. Identification No. of Above Person (Entities Only) CVC II Partners, L.L.C. 13-4144132 - ------------------------------------------------------------------------------- 2. Check the Appropriate Box if a Member of a Group (a) |X| ------------------------------------------------------------------- (b) |_| - ------------------------------------------------------------------------------- 3. SEC Use Only - ------------------------------------------------------------------------------- 4. Source of Funds Not Applicable - ------------------------------------------------------------------------------- 5. Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d) or 2(e) |_| - ------------------------------------------------------------------------------- 6. Citizenship or Place of Organization Delaware - ------------------------------------------------------------------------------- 7. Sole Voting Power NUMBER OF 69,708 shares of Common Stock SHARES BENEFICIALLY --------------------------------------------------- OWNED BY EACH 8. Shared Voting Power REPORTING PERSON --------------------------------------------------- WITH 9. Sole Dispositive Power 69,708 shares of Common Stock --------------------------------------------------- 10. Shared Dispositive Power - ------------------------------------------------------------------------------- 11. Aggregate Amount Beneficially Owned by Each Reporting Person 69,708 shares of Common Stock - ------------------------------------------------------------------------------- 12. Check if The Aggregate Amount in Row (11) Excludes Certain Shares |_| - ------------------------------------------------------------------------------- 13. Percent Of Class Represented By Amount In Row (11) 0.9% - ------------------------------------------------------------------------------- 14. Type of Reporting Person CO - ------------------------------------------------------------------------------- CUSIP No. 594944 10 0 Page 6 of 10 Pages - ------------------------------------------------------------------------------- 1. Name of Reporting Person I.R.S. Identification No. of Above Person (Entities Only) Constellation Ventures Management II, LLC 13-4122121 - ------------------------------------------------------------------------------- 2. Check the Appropriate Box if a Member of a Group (a) |X| ------------------------------------------------------------------- (b) |_| - ------------------------------------------------------------------------------- 3. SEC Use Only - ------------------------------------------------------------------------------- 4. Source of Funds Not Applicable - ------------------------------------------------------------------------------- 5. Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d) or 2(e) |_| - ------------------------------------------------------------------------------- 6. Citizenship or Place of Organization Delaware - ------------------------------------------------------------------------------- 7. Sole Voting Power NUMBER OF SHARES BENEFICIALLY --------------------------------------------------- OWNED BY EACH 8. Shared Voting Power REPORTING 5,521,703 shares of Common Stock PERSON WITH --------------------------------------------------- 9. Sole Dispositive Power --------------------------------------------------- 10. Shared Dispositive Power 5,521,703 shares of Common Stock - ------------------------------------------------------------------------------- 11. Aggregate Amount Beneficially Owned by Each Reporting Person shares of Common Stock - ------------------------------------------------------------------------------- 12. Check if The Aggregate Amount in Row (11) Excludes Certain Shares |_| - ------------------------------------------------------------------------------- 13. Percent Of Class Represented By Amount In Row (11) 42.8% - ------------------------------------------------------------------------------- 14. Type of Reporting Person CO - ------------------------------------------------------------------------------- CUSIP No. 594944 10 0 Page 7 of 10 Pages - ------------------------------------------------------------------------------- 1. Name of Reporting Person I.R.S. Identification No. of Above Person (Entities Only) Bear Stearns Asset Management Inc. 06-1135192 - ------------------------------------------------------------------------------- 2. Check the Appropriate Box if a Member of a Group (a) |X| ------------------------------------------------------------------- (b) |_| - ------------------------------------------------------------------------------- 3. SEC Use Only - ------------------------------------------------------------------------------- 4. Source of Funds Not Applicable - ------------------------------------------------------------------------------- 5. Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d) or 2(e) |_| - ------------------------------------------------------------------------------- 6. Citizenship or Place of Organization Delaware - ------------------------------------------------------------------------------- 7. Sole Voting Power NUMBER OF SHARES BENEFICIALLY --------------------------------------------------- OWNED BY EACH 8. Shared Voting Power REPORTING 5,591,411 shares of Common Stock PERSON WITH --------------------------------------------------- 9. Sole Dispositive Power --------------------------------------------------- 10. Shared Dispositive Power 5,591,411 shares of Common Stock - ------------------------------------------------------------------------------- 11. Aggregate Amount Beneficially Owned by Each Reporting Person 5,591,411 shares of Common Stock - ------------------------------------------------------------------------------- 12. Check if The Aggregate Amount in Row (11) Excludes Certain Shares |_| - ------------------------------------------------------------------------------- 13. Percent Of Class Represented By Amount In Row (11) 43.1% - ------------------------------------------------------------------------------- 14. Type of Reporting Person CO - ------------------------------------------------------------------------------- CUSIP No. 594944 10 0 Page 8 of 10 Pages Amendment No. 2 to Schedule 13D Reference is hereby made to the statement on Schedule 13D filed with the Securities and Exchange Commission (the "Commission") on December 17, 2004 and Amendment No. 1 thereto filed on July 21, 2005 (as so amended, the "Schedule 13D"). Terms defined in the Schedule 13D are used herein as so defined. The Schedule 13D is hereby amended as follows: Item 1. Identity and Background Item 1 is hereby amended by adding the following thereto: By virtue of NEXL Voting Agreement described in Item 6 below, the Reporting Persons may also be deemed to be a group with the other NEXL Voting Agreement Parties. While the Reporting Persons do not affirm that such a "group" has been formed, this disclosure is being made to ensure compliance with the Exchange Act. The Reporting Persons expressly disclaim beneficial ownership of securities beneficially owned by any other person or entity, and the securities reported herein as being beneficially owned by the Reporting Persons do not include any securities beneficially owned by any other person or entity. Item 4. Purpose of Transaction Item 4 is hereby amended by adding the following thereto: On August 9, 2005, Clifford Friedman resigned as a member of the Board of Directors and, pursuant to the terms of the Restated Shareholders' Agreement, the Constellation Purchasing Entities appointed Thomas Wasserman as a director, effective August 9, 2005. Item 6. Contracts, Arrangements, Understandings or Relationships with Respect to Securities of the Issuer Item 6 is hereby amended by adding the following thereto: NEXL MERGER AGREEMENT On August 16, 2005, the Issuer entered into an Agreement and Plan of Merger (the "NEXL Merger Agreement") with NEXL, Inc., a Massachusetts corporation ("NEXL"), MTM Technologies (Massachusetts),LLC, a Delaware limited liability company and wholly owned subsidiary of the Issuer (the "Merger Subsidiary"), Clifford L. Rucker (the "Controlling Shareholder") and each person added as a party to the NEXL Merger Agreement pursuant to Section 12.02 thereof (collectively with the Controlling Shareholder, the "Shareholders" and each a "Shareholder"), pursuant to which NEXL will be merged with and into the Merger Subsidiary and the Merger Subsidiary will continue as the surviving entity and a wholly owned subsidiary of Issuer (the "NEXL Merger"). Subject to certain adjustments, in exchange for all of the outstanding capital stock of NEXL, the shareholders of NEXL will receive, in the aggregate: (i) $13,050,000 in cash (the "Cash Consideration"); and (ii) 3,000,000 shares of Common Stock (the "Stock Consideration"), a portion of which will be delivered to an escrow agent, to be held and distributed pursuant to the terms of an escrow agreement; provided that if the average of the NASDAQ closing price of Common Stock for the 30 trading days ending on the date five business days prior to the meeting of the Issuer's shareholders convened to approve the sale and issuance of MTM Common Stock (the "Stockholder Meeting") pursuant to the Merger Agreement (such average, the "Stock Value") is greater than $5.85 per share, the Stock Payment will be reduced such that the total value of the shares of Common Stock actually delivered (including the shared delivered to the Escrow Agent) equals $17,550,000. Upon the achievement of certain performance benchmarks, which are subject to adjustment based on the occurrence of certain events specified in the NEXL Merger Agreement, the shareholders of NEXL will be entitled to receive and additional $1,000,000 in cash and additional shares of Common Stock in an aggregate amount determined by dividing $1,000,000 by the greater of (A) the average NASDAQ closing price of the Common Stock for the ten business days ending immediately prior to the end of the period beginning on the first day of the first calendar month following the closing date and ending on the date twelve months thereafter and (B) $4.00. CUSIP No. 594944 10 0 Page 8 of 10 Pages The obligations of the parties to the NEXL Merger Agreement to effect the NEXL Merger are subject to certain conditions, including shareholder approval, regulatory approvals and other customary closing conditions. Prior to the effective time of the NEXL Merger, the Issuer or NEXL may terminate the NEXL Merger Agreement under certain conditions, in each case as set forth in the NEXL Merger Agreement. In addition, the NEXL Merger Agreement may be terminated by either the Issuer or NEXL if five business days prior to the Stockholder Meeting, the Stock Value is less than $2.90, unless either (i) NEXL and the Controlling Shareholder agree to reduce the Cash Consideration such that the value of the Stock Consideration constitutes at least 40% of the total consideration to be paid on the closing date, prior to adjustment or (ii) the Issuer agrees to increase the Stock Consideration such that the value of the Stock Consideration constitutes at least 40% of the total consideration to be paid on the closing date, prior to adjustment. On August 16, 2005, the holders of the Preferred Stock, voting as a separate class, approved the transactions contemplated by the NEXL Merger Agreement by written consent. The issuance of shares of Common Stock in the Merger requires the approval of the Issuer's shareholders in accordance with the requirements of the Nasdaq Stock Market. NEXL VOTING AGREEMENT Concurrently with, and as a condition to, NEXL's execution of the NEXL Merger Agreement, the Constellation Purchasing Entities, Pequot Private Equity Fund III, L.P. and Pequot Offshore Private Equity Partners III, L.P. (together, the "Pequot Funds") and the Company (collectively, the "NEXL Voting Agreement Parties"), entered into a Voting Agreement (the "NEXL Voting Agreement"). Under the NEXL Voting Agreement, the NEXL Voting Agreement Parties have agreed that, at any meeting of the shareholders of the Issuer, or in connection with any other circumstances upon which a vote, consent or other approval (including by written consent) to be taken by the shareholders of the Issuer relating to the NEXL Merger Agreement and the transactions contemplated thereby or for the Issuer to perform its obligations thereunder, the NEXL Voting Agreement Parties will vote in favor of the adoption of the NEXL Merger Agreement and the approval of the transactions contemplated thereby. Until the transactions contemplated by the NEXL Merger Agreement are consummated or the NEXL Merger Agreement is terminated, each shareholder party to the NEXL Voting Agreement agreed not to enter into or exercise its rights under any voting arrangement with respect to its shares or take any other action that would restrict, limit or interfere with the performance of its obligations under the NEXL Voting Agreement or the transactions contemplated thereby. Each of the shareholders party to the NEXL Voting Agreement granted an irrevocable proxy to John F. Kohler, the Issuer's general counsel, and any other individual designated by the shareholders, to vote such shareholder's shares or grant consent or approval of the NEXL Merger Agreement and the transactions contemplated thereby. Pursuant to its terms, the NEXL Voting Agreement, and all rights and obligations thereunder, terminate upon the earlier of: (ii) the consummation of the transactions contemplated by the NEXL Merger Agreement; or (ii) the termination of the NEXL Merger Agreement in accordance with its terms. A copy of the NEXL Merger Agreement is incorporated herein by reference as Exhibit 1, and a copy of the NEXL Voting Agreement is attached hereto as Exhibit 2. Any descriptions of such agreements are qualified in their entirety by reference thereto. Item 7. Material To Be Filed As Exhibits Exhibit 1 Agreement and Plan of Merger, dated as of August 16, 2005, by and among the Issuer, NEXL, Inc. and MTM Technologies (Massachusetts), LLC, Clifford L. Rucker and each person added thereto pursuant to Section 12.02 thereof (incorporated by reference to Exhibit 1 to the Issuer's Report on Form 8-K dated August 16, 2005 filed with the Commission on August 19, 2005). Exhibit 2 Voting Agreement, by and among the Issuer, the Constellation Purchasing Entities and the Pequot Funds (appears at Page 11) CUSIP No. 594944 10 0 Page 10 of 10 Pages Signature The undersigned hereby agree that this Schedule 13D with respect to the Common Stock, par value $.001 per share, of MTM Technologies, Inc. is filed on behalf of each of them in accordance with the provisions of Rule 13d-1(k) under the Securities Exchange Act of 1934, as amended. After reasonable inquiry and to the best of their knowledge and belief, the undersigned certify that the information set forth in this statement is true, complete and correct. Dated: September 1, 2005 CONSTELLATION VENTURE CAPITAL II, L.P. By: Constellation Ventures Management II, LLC, General Partner By: Bear Stearns Asset Management Inc., Managing Member By:/s/ Clifford H. Friedman --------------------------------------------------------------- Name: Clifford H. Friedman Title: Senior Managing Director CONSTELLATION VENTURE CAPTIAL OFFSHORE II, L.P. By: Constellation Ventures Management II, LLC, General Partner By: Bear Stearns Asset Management Inc., Managing Member By:/s/ Clifford H. Friedman --------------------------------------------------------------- Name: Clifford H. Friedman Title: Senior Managing Director THE BSC EMPLOYEE FUND VI, L.P. By: Constellation Ventures Management II, LLC, General Partner By: Bear Stearns Asset Management Inc., Managing Member By:/s/ Clifford H. Friedman --------------------------------------------------------------- Name: Clifford H. Friedman Title: Senior Managing Director CVC II PARTNERS, L.L.C. By:/s/ Clifford H. Friedman --------------------------------------------------------------- Name: Clifford H. Friedman Title: Member CONSTELLATION VENTURES MANAGEMENT II, LLC By: Bear Stearns Asset Management Inc., Managing Member By:/s/ Clifford H. Friedman --------------------------------------------------------------- Name: Clifford H. Friedman Title: Senior Managing Director BEAR STEARNS ASSET MANAGEMENT INC. By:/s/ Clifford H. Friedman --------------------------------------------------------------- Name: Clifford H. Friedman Title: Senior Managing Director EX-2 2 e2_0831-2005mtm.txt VOTING AGREEMENT VOTING AGREEMENT THIS VOTING AGREEMENT (this "Agreement"), dated as of August 16, 2005, is by and among the persons listed on SCHEDULE I hereto (each a "Shareholder", and, collectively, the "Shareholders"). WHEREAS, MTM Technologies, Inc., a New York corporation (the "Company"), proposes to enter into an Agreement and Plan of Merger of even date herewith (the "Merger Agreement") with NEXL, Inc., a Massachusetts corporation ("NEXL"), Clifford L. Rucker and MTM (Massachusetts), LLC, a Delaware limited liability company and wholly-owned subsidiary of the Company ("Merger Subsidiary"), for the merger of NEXL with and into the Merger Subsidiary; WHEREAS, on an as converted basis, the Shareholders own approximately 69% of the Common Stock, $.001 par value per share, of the Company (the "Common Stock"); WHEREAS, as a condition to the execution and delivery of the Merger Agreement, NEXL has requested that the Shareholders enter into this Agreement; WHEREAS, the Shareholders believe that the execution, delivery and performance of the Merger Agreement by the Company and the consummation of the transactions contemplated thereby (the "Transactions") are in the best interests of the Company and its shareholders; and WHEREAS, each Shareholder is the record and beneficial owner, or the trustee of a trust whose beneficiaries are the beneficial owners, of such number of shares of Common Stock of the Company set forth opposite such Shareholder's name on SCHEDULE I hereto (such shares of Common Stock, as such shares may be adjusted by stock dividend, stock split, recapitalization, combination or exchange of shares, merger, consolidation, reorganization or other change or transaction, together with shares of Common Stock that may be acquired after the date hereof by such Shareholder, including shares of Common Stock issued upon the exercise of options or warrants to purchase Common Stock (as the same may be adjusted as aforesaid), being collectively referred to herein as the "Shares"). NOW, THEREFORE, in consideration of the premises and the representations, warranties and agreements contained herein, the Shareholders agree as follows: 1. REPRESENTATIONS AND WARRANTIES OF THE SHAREHOLDERS. Each Shareholder hereby, severally and not jointly, represents and warrants to the other Shareholders as follows: (a) AUTHORITY. The Shareholder has all requisite power and authority to execute and deliver this Agreement and to consummate the transactions contemplated hereby. The execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby have been duly authorized by the Shareholder. This Agreement has been duly executed and delivered by the Shareholder and constitutes a valid and binding obligation of the Shareholder enforceable against the Shareholder in accordance with its terms (subject to (i) laws of general application relating to bankruptcy, insolvency and the relief of debtors, and (ii) rules of law governing specific performance, injunctive relief, or other equitable remedies). Except as set forth on SCHEDULE II hereto, neither the execution, delivery or performance of this Agreement by the Shareholder nor the consummation by the Shareholder of the transactions contemplated hereby will (i) require any filing with, or permit, authorization, consent or approval of, any federal, state, local or municipal foreign or other government or subdivision, branch, department or agency thereof or any governmental or quasi-governmental authority of any nature, including any court or other tribunal, (a "Governmental Entity"), (ii) result in a violation or breach of, or constitute (with or without due notice or lapse of time or both) a default under, or give rise to any right of termination, amendment, cancellation or acceleration under, or result in the creation of any pledge, claim, lien, option, charge, encumbrance or security interest of any kind or nature whatsoever (a "Lien") upon any of the properties or assets of the Shareholder under, any of the terms, conditions or provisions of any note, bond, mortgage, indenture, lease, license, permit, concession, franchise, contract, agreement or other instrument or obligation (a "Contract") to which the Shareholder is a party or by which the Shareholder or any of the Shareholder's properties or assets, including the Shareholder's Shares, may be bound or (iii) violate any judgment, order, writ, preliminary or permanent injunction or decree (an "Order") or any statute, law, ordinance, rule or regulation of any Governmental Entity (a "Law") applicable to the Shareholder or any of the Shareholder's properties or assets, including the Shareholder's Shares. (b) THE SHARES. Subject to the terms of this Agreement, the Shareholder's Shares and the certificates representing such Shares are now, and at all times during the term hereof will be, held by such Shareholder, or by a nominee or custodian for the benefit of such Shareholder. The Shareholder has good and marketable title to such Shares, free and clear of any Liens, proxies, voting trusts or agreements, understandings or arrangements, except for proxies arising hereunder pursuant to Section 4(a) hereof and except as set forth on SCHEDULE II hereto. The Shareholder owns of record or beneficially no Common Stock or other voting interest in the Company other than such Shareholder's Shares and shares of Company Common Stock issuable upon the exercise of options and warrants, in each case as set forth on SCHEDULE I hereto. (c) MERGER AGREEMENT. Each Shareholder understands and acknowledges that the Company is entering into the Merger Agreement in reliance upon such Shareholder's execution and delivery of this Agreement. 2. BOARD APPROVAL. Each Shareholder understands and acknowledges that the Board of Directors of the Company has, to the extent required by applicable law, duly and validly authorized and approved, this Agreement, the Merger Agreement and the transactions contemplated hereby and thereby. 3. AGREEMENTS OF SHAREHOLDERS. Each Shareholder, severally and not jointly, agrees as follows: (a) Until the Transactions are consummated or the Merger Agreement is terminated in accordance with its terms, the Shareholder shall not, (i) enter into or exercise its rights under any voting arrangement, whether by proxy, voting agreement, voting trust, power-of- 2 attorney or otherwise, with respect to the Shares or (ii) take any other action that would in any way restrict, limit or interfere with the performance of its obligations hereunder or the transactions contemplated hereby. (b) At any meeting of Shareholders of the Company called to vote upon the Transactions and the Merger Agreement or at any adjournment thereof or in any other circumstances upon which a vote, consent or other approval (including by written consent) with respect to the Transactions and the Merger Agreement or which is necessary to consummate the Transactions or for the Company to perform its obligations under the Merger Agreement is sought, each Shareholder shall, including by executing a written consent if requested by the Company, vote (or cause to be voted) such Shareholder's Shares in favor of the Transactions and the adoption by the Company of the Merger Agreement. 4. GRANT OF IRREVOCABLE PROXY COUPLED WITH AN INTEREST; APPOINTMENT OF PROXY. (a) Each Shareholder hereby irrevocably grants to, and appoints John F. Kohler, and any other individual who shall hereafter be designated by the Shareholders, and each of them, as such Shareholder's proxy and attorney-in-fact (with full power of substitution), for and in the name, place and stead of such Shareholder, to vote such Shareholder's Shares, or grant a consent or approval in respect of such Shares, at any meeting of Shareholders of the Company or at any adjournment thereof or in any other circumstances upon which their vote, consent or other approval is sought in favor of the Transactions, the execution by the Company of the Merger Agreement and the approval of the other transactions contemplated by the Merger Agreement, including without limitation, the issuance of shares of Common Stock to the shareholders of NEXL as provided therein. (b) Each Shareholder represents that, except with respect to the Other Voting Agreement listed on SCHEDULE II hereto, any prior proxies heretofore given in respect of such Shareholder's Shares are not irrevocable, and that any such prior proxies are hereby revoked. (c) EACH SHAREHOLDER HEREBY AFFIRMS THAT THE PROXY SET FORTH IN THIS SECTION 4 IS COUPLED WITH AN INTEREST AND IS IRREVOCABLE UNTIL SUCH TIME AS THIS AGREEMENT TERMINATES IN ACCORDANCE WITH ITS TERMS. Such Shareholder hereby further affirms that the irrevocable proxy is given in connection with the execution of the Merger Agreement, and that such irrevocable proxy is given to secure the performance of the duties of such Shareholder under this Agreement. Such Shareholder hereby ratifies and confirms all that such irrevocable proxy may lawfully do or cause to be done by virtue hereof. Such irrevocable proxy is executed and intended to be irrevocable in accordance with the provisions of Section 609 of the New York Business Corporation Law. 5. FURTHER ASSURANCES. Each Shareholder will, from time to time, execute and deliver, or cause to be executed and delivered, such additional or further transfers, assignments, endorsements, consents and other instruments as the Company may reasonably request for the purpose of effectively carrying out the transactions contemplated by this Agreement and to vest the power to vote such Shareholder's Shares as contemplated by Section 4. 3 6. TERMINATION. This Agreement, and all rights and obligations of the parties hereunder, shall terminate upon the consummation of the Transactions or earlier termination of the Merger Agreement in accordance with its terms. Nothing in this Section 6 shall relieve any Shareholder from liability for willful breach of this Agreement. 7. GENERAL. (a) COUNTERPARTS. This Agreement may be executed in two or more counterparts, all of which shall be considered one and the same agreement and shall become effective when two or more counterparts have been signed by each of the parties and delivered to the other parties, it being understood that all parties need not sign the same counterpart. (b) DEFINITIONS. Capitalized terms used herein and not otherwise defined shall have the meanings ascribed to such terms in the Merger Agreement. (c) ENTIRE AGREEMENT; THIRD-PARTY BENEFICIARIES. Each party hereby acknowledges that no other party or any other person or entity has made any promises, warranties, understandings or representations whatsoever, express or implied, not contained in this Agreement and acknowledges that it has not executed this Agreement in reliance upon any such promises, representations, understandings or warranties not contained herein and that this Agreement supersedes all prior agreements and understandings between the parties with respect thereto. There are no promises, covenants or undertakings other than those expressly set forth or provided for in this Agreement. The Company shall be a third party beneficiary of the rights and benefits of this Agreement. This Agreement is not intended to confer upon any person other than the parties hereto any rights or remedies hereunder. (d) GOVERNING LAW. This Agreement shall be governed and construed in accordance with the laws of the State of New York without regard to any applicable conflicts of law. (e) TITLES AND SUBTITLES. The titles and subtitles used in this Agreement are used for convenience only and are not to be considered in construing or interpreting this Agreement. (f) NOTICES. All notices and other communications required or permitted hereunder shall be in writing. Notices shall be delivered personally, via recognized overnight courier (such as Federal Express, DHL or Airborne Express) or via certified or registered mail. Notices may be delivered via facsimile or e-mail, provided that by no later than two days thereafter such notice is confirmed in writing and sent via one of the methods described in the previous sentence. Notices shall be addressed to the address of each Shareholder as is set forth on the books and records of the Company, or at such other address or facsimile number as such Shareholder shall have furnished in writing to the other parties hereto. All notices shall be effective upon receipt. (g) SEVERABILITY Whenever possible, each provision of this Agreement will be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement is held to be invalid, illegal or unenforceable in any respect under any applicable law or rule in any jurisdiction, such invalidity, illegality or 4 unenforceability will not affect any other provision or any other jurisdiction, but this Agreement will be reformed, construed and enforced in such jurisdiction to the greatest extent possible to carry out the intentions of the parties hereto. (h) DELAYS OR OMISSIONS. No delay or omission to exercise any right, power or remedy accruing to any party under this Agreement, upon any breach or default of any other party under this Agreement, shall impair any such right, power or remedy of such nonbreaching or nondefaulting party nor shall it be construed to be a waiver of any such breach or default, or an acquiescence therein, or of or in any similar breach or default thereafter occurring; nor shall any waiver of any single breach or default be deemed a waiver of any other breach or default theretofore or thereafter occurring. (i) FACSIMILE SIGNATURES. Any signature page delivered by a fax machine shall be binding to the same extent as an original signature page, with regard to any agreement subject to the terms hereof or any amendment thereto. (j) AMENDMENT AND WAIVER. This Agreement may be amended by the parties hereto by execution of an instrument in writing signed on behalf of the Shareholders holding a majority of Shares held by all of the Shareholders and the written consent of the Company as a third-party beneficiary. Any amendment signed by the Shareholders holding a majority of Shares held by all of the Shareholders shall bind all of the Shareholders. An action, extension or waiver signed by the Shareholder holding a majority of Shares held by all of the Shareholders shall bind all of the Shareholders. 8. SHAREHOLDER CAPACITY. No person executing this Agreement who is or becomes during the term hereof a director or officer of the Company makes any agreement or understanding herein in his or her capacity as such director or officer. Each Shareholder signs solely in his, her or its capacity as the record holder and beneficial owner of, or the trustee of a trust whose beneficiaries are the beneficial owners of, such Shareholder's Shares and nothing herein shall limit or affect any actions taken by a Shareholder in its capacity as an officer or director of the Company to the extent specifically permitted by the Merger Agreement or as otherwise required by law.. 9. ENFORCEMENT. The parties agree that irreparable damage would occur in the event that any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached. It is accordingly agreed that the parties shall be entitled to an injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the terms and provisions of this Agreement in a court of the United States. This being in addition to any other remedy to which they are entitled at law or in equity. In addition, each of the parties hereto waives any right to trial by jury with respect to any claim or proceeding related to or arising out of this Agreement or any of the transactions contemplated hereby. 5 IN WITNESS WHEREOF, each party hereto has signed this Agreement as of the date first written above. PEQUOT PRIVATE EQUITY FUND III, L.P. By: Pequot Capital Management, Inc., its Investment Manager By: /s/ Aryeh Davis ------------------------------------- Name: Aryeh Davis Title: General Counsel PEQUOT OFFSHORE PRIVATE EQUITY PARTNERS III, L.P. By: Pequot Capital Management, Inc., its Investment Advisor By: /s/ Aryeh Davis ------------------------------------- Name: Aryeh Davis Title: General Counsel CONSTELLATION VENTURE CAPITAL II, L.P. By: Constellation Ventures Management II, LLC Its General Partner By: /s/ Thomas Wasserman ------------------------------------- Name: Title: Signature Page to Voting Agreement CONSTELLATION VENTURE CAPITAL OFFSHORE II, L.P. By: Constellation Ventures Management II, LLC Its General Partner By: /s/ Thomas Wasserman ------------------------------------- Name: Title: THE BSC EMPLOYEE FUND VI, L.P. By: Constellation Ventures Management II, LLC Its General Partner By: /s/ Thomas Wasserman ------------------------------------- Name: Title: CVC II PARTNERS, LLC By: The Bear Stearns Companies Inc. Its Managing Member By: /s/ Thomas Wasserman ------------------------------------- Name: Title: Signature Page to Voting Agreement SCHEDULE I ---------- - ---------------------------------------------- --------------------------------- SHAREHOLDER PREFERRED STOCK - ---------------------------------------------- --------------------------------- Pequot Private Equity Fund III, L.P. 10,762,972 - ---------------------------------------------- --------------------------------- Pequot Offshore Private Equity Partners III, 1,517,153 L.P. - ---------------------------------------------- --------------------------------- Constellation Venture Capital II, L.P. 2,330,598 - ---------------------------------------------- --------------------------------- Constellation Venture Capital Offshore II, 1,240,235 L.P. - ---------------------------------------------- --------------------------------- The BSC Employee Fund VI, L.P. 1,039,301 - ---------------------------------------------- --------------------------------- CVC II Partners, LLC 58,200 - ---------------------------------------------- --------------------------------- TOTAL 16,947,909 - ---------------------------------------------- --------------------------------- SCHEDULE II ----------- REQUIRED FILINGS: Filings with the Securities and Exchange Commission pursuant to the requirements of the Securities and Exchange Act of 1934, as amended. OTHER VOTING AGREEMENT Amended and Restated Shareholders' Agreement, dated as of August 1, 2005, among the Company and certain of its shareholders. -----END PRIVACY-ENHANCED MESSAGE-----