EXHIBIT 2.2
AGREEMENT AND PLAN OF MERGER
BY AND AMONG
PREMIERE TECHNOLOGIES, INC.
PTEK MERGER CORPORATION II
VTN, INC.
AND
THE STOCKHOLDERS OF VTN, INC.
DATED AS OF APRIL 2, 1997
TABLE OF CONTENTS
Page
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PARTIES.................................................................... 1
PREAMBLE................................................................... 1
ARTICLE 1 - TRANSACTIONS AND TERMS OF MERGER............................... 1
1.1 Merger........................................................... 1
1.2 Time and Place of Closing........................................ 1
1.3 Effective Time................................................... 2
1.4 Tax-Free Reorganization.......................................... 2
ARTICLE 2 - TERMS OF MERGER................................................ 2
2.1 Articles of Incorporation........................................ 2
2.2 Code of Regulations.............................................. 2
2.3 Directors and Officers........................................... 2
ARTICLE 3 - MANNER OF CONVERTING SHARES.................................... 2
3.1 Conversion of Shares............................................. 2
3.2 Anti-Dilution Provisions......................................... 4
3.3 Shares Held by VTN or Premiere................................... 5
3.4 Dissenting Stockholders.......................................... 5
3.5 Fractional Shares................................................ 5
3.6 Stock Options.................................................... 5
ARTICLE 4 - EXCHANGE OF SHARES............................................. 6
4.1 Exchange Procedures.............................................. 6
4.2 Rights of Former VTN Stockholders................................ 7
4.3 Escrow Agreement................................................. 7
4.4 Legending of Securities; Pooling Restrictions.................... 8
ARTICLE 5 - REPRESENTATIONS AND WARRANTIES OF VTN AND THE STOCKHOLDERS..... 8
5.1 Organization, Standing, and Power................................ 8
5.2 Authority of VTN; No Breach By Agreement......................... 9
5.3 Authority of Stockholders; No Breach By Agreement................ 10
5.4 Capital Stock.................................................... 10
5.5 VTN Subsidiaries; VTNLP.......................................... 11
5.6 Financial Statements............................................. 11
5.7 Absence of Undisclosed Liabilities............................... 12
5.8 Absence of Certain Changes or Events............................. 12
5.9 Tax Matters...................................................... 12
5.10 Assets........................................................... 13
5.11 Intellectual Property............................................ 15
5.12 Environmental Matters............................................ 16
5.13 Compliance with Laws............................................. 17
5.14 Labor Relations.................................................. 18
5.15 Employee Benefit Plans........................................... 18
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5.16 Certain Contracts................................................. 20
5.17 Legal Proceedings................................................. 21
5.18 Reports........................................................... 21
5.19 Franchise Matters................................................. 21
5.20 VTN Products and Services......................................... 21
5.21 System Performance................................................ 22
5.22 Statements True and Correct....................................... 23
5.23 Accounting and Regulatory Matters................................. 23
5.24 State Takeover Laws............................................... 23
5.25 Charter Provisions................................................ 23
5.26 Investment Intention, Etc......................................... 23
5.27 Board Recommendation.............................................. 24
5.28 Amway Matters..................................................... 24
ARTICLE 6 - REPRESENTATIONS AND WARRANTIES OF PREMIERE...................... 25
6.1 Organization, Standing, and Power................................. 25
6.2 Authority; No Breach By Agreement................................. 26
6.3 Capital Stock..................................................... 26
6.4 Premiere Subsidiaries............................................. 27
6.5 SEC Filings; Financial Statements................................. 28
6.6 Absence of Undisclosed Liabilities................................ 28
6.7 Absence of Certain Changes or Events.............................. 28
6.8 Compliance with Laws.............................................. 29
6.9 Legal Proceedings................................................. 29
6.10 Statements True and Correct....................................... 30
6.11 Accounting and Regulatory Matters................................. 30
ARTICLE 7 - CONDUCT OF BUSINESS PENDING CONSUMMATION........................ 30
7.1 Affirmative Covenants of VTN...................................... 30
7.2 Negative Covenants of VTN......................................... 30
7.3 Covenants of Premiere............................................. 32
7.4 Adverse Changes in Condition...................................... 33
7.5 Reports........................................................... 33
ARTICLE 8 - ADDITIONAL AGREEMENTS........................................... 33
8.2 Exchange Listing.................................................. 33
8.3 Applications; Antitrust Notification.............................. 33
8.4 Filings with State Offices........................................ 34
8.5 Agreement as to Efforts to Consummate............................. 34
8.6 Investigation and Confidentiality................................. 34
8.7 Press Releases.................................................... 35
8.8 Certain Actions................................................... 35
8.9 Stockholder Releases.............................................. 35
8.10 Accounting Treatment.............................................. 36
8.11 State Takeover Laws............................................... 36
8.12 Charter Provisions................................................ 36
8.13 Tax Returns....................................................... 36
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8.14 Noncompetition, Nonsolicitation and Nondisclosure................. 36
8.15 Amway Convertible Note............................................ 38
ARTICLE 9 - CONDITIONS PRECEDENT TO OBLIGATIONS TO CONSUMMATE............... 38
9.1 Conditions to Obligations of Each Party........................... 38
9.2 Conditions to Obligations of Premiere............................. 40
9.3 Conditions to Obligations of VTN and the Stockholders............. 42
ARTICLE 10 - INDEMNIFICATION................................................ 42
10.1 Agreement of Indemnitors to Indemnify............................. 42
10.2 Procedures for Indemnification.................................... 43
10.3 Third Party Claims................................................ 44
10.4 Limitations as to Amount.......................................... 45
10.5 Tax Effect and Insurance.......................................... 46
10.6 Subrogation....................................................... 46
10.7 Arbitration....................................................... 46
10.8 Exclusivity....................................................... 47
ARTICLE 11 - TERMINATION.................................................... 47
11.1 Termination....................................................... 47
11.2 Effect of Termination............................................. 48
ARTICLE 12 - MISCELLANEOUS.................................................. 48
12.1 Definitions....................................................... 48
12.2 Expenses.......................................................... 60
12.3 Brokers and Finders............................................... 61
12.4 Entire Agreement.................................................. 61
12.5 Amendments........................................................ 61
12.6 Waivers........................................................... 61
12.7 Assignment........................................................ 62
12.8 Notices........................................................... 62
12.9 Governing Law..................................................... 63
12.10 Counterparts...................................................... 63
12.11 Captions; Articles and Sections................................... 63
12.12 Interpretations................................................... 63
12.13 Enforcement of Agreement.......................................... 64
12.14 Severability...................................................... 64
12.15 Survival.......................................................... 64
SIGNATURES.................................................................. 65
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LIST OF EXHIBITS
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EXHIBIT NUMBER DESCRIPTION
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1. Form of General Escrow Agreement. ((s) 4.3).
2. Form of Specific Escrow Agreement. ((s) 5.25).
3. [Reserved]
4. Form of Registration Rights Agreement. ((s) 9.1(j)).
5. Premiere Certificate ((s) 6.11).
6. [Reserved]
7. Form of Claims Letter ((s) 9.2(g)).
8. Grand Solution Documents ((s) 9.2(n))
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AGREEMENT AND PLAN OF MERGER
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THIS AGREEMENT AND PLAN OF MERGER (this "Agreement") is made and entered
into as of April 2, 1997, by and among PREMIERE TECHNOLOGIES, INC. ("Premiere"),
a Georgia corporation; PTEK MERGER CORPORATION II ("Sub"), an Ohio corporation
and wholly-owned subsidiary of Premiere; VTN, INC. ("VTN"), an Ohio corporation;
and the stockholders of VTN set forth on the signature pages hereof (each a
"Stockholder" and collectively the "Stockholders").
PREAMBLE
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This Agreement provides for the acquisition of VTN by Premiere pursuant to
the merger of Sub with and into VTN. At the effective time of such merger, the
outstanding shares of the capital stock of VTN shall be converted into shares of
the common stock of Premiere (except as provided herein). As a result,
stockholders of VTN shall become stockholders of Premiere and VTN shall continue
to conduct its business and operations. The transactions described in this
Agreement are subject expiration of the required waiting period under the HSR
Act and the satisfaction of certain other conditions described in this
Agreement. It is the intention of the parties to this Agreement that the Merger
for federal income tax purposes shall qualify as a "reorganization" within the
meaning of Section 368(a) of the Code, and for accounting purposes shall qualify
for treatment as a pooling of interests.
Certain terms used in this Agreement are defined in Section 12.1 of this
Agreement.
NOW, THEREFORE, in consideration of the above and the mutual warranties,
representations, covenants, and agreements set forth herein, the parties agree
as follows:
ARTICLE 1
TRANSACTIONS AND TERMS OF MERGER
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1.1 MERGER. Subject to the terms and conditions of this Agreement, at
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the Effective Time, Sub shall be merged with and into VTN in accordance with the
provisions of Section 1701.78 of the OGCL and with the effect provided in
Section 1701.82 of the OGCL (the "Merger"). VTN shall be the Surviving
Corporation resulting from the Merger and shall continue to be governed by the
Laws of the State of Ohio. The Merger shall be consummated pursuant to the terms
of this Agreement, which has been approved and adopted by the respective Boards
of Directors of VTN, Sub and Premiere.
1.2 TIME AND PLACE OF CLOSING. The closing of the transactions
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contemplated hereby (the "Closing") will take place at 9:00 A.M. on the date
that the Effective Time occurs (or the immediately preceding day if the
Effective Time is earlier than 9:00 A.M.), or at such other time as the Parties,
acting through their authorized officers, may mutually agree. The Closing
shall be held at the offices of Xxxxxx & Bird LLP, Atlanta, Georgia, or at such
other location as may be mutually agreed upon by the Parties.
1.3 EFFECTIVE TIME. The Merger and other transactions contemplated by
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this Agreement shall become effective on the date and at the time the
Certificate of Merger reflecting the Merger shall become effective with the
Secretary of State of the State of Ohio (the "Effective Time").
1.4 TAX-FREE REORGANIZATION. The Parties intend to adopt this Agreement
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as a tax-free plan of reorganization and to consummate the Merger in accordance
with the provisions of Sections 368(a)(1)(A) and 368(a)(2)(E) of the Code. In
this regard, Premiere represents that it currently intends, and that on the
Effective Date it will intend, to continue VTN's historic business or use a
significant portion of VTN's business assets in a business within the meaning of
Treasury Regulation Section 1.368-1(d).
ARTICLE 2
TERMS OF MERGER
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2.1 ARTICLES OF INCORPORATION. The Articles of Incorporation of VTN
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in effect immediately prior to the Effective Time shall be the Articles of
Incorporation of the Surviving Corporation until duly amended or repealed.
2.2 CODE OF REGULATIONS. The Code of Regulations of VTN in effect
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immediately prior to the Effective Time shall be the Code of Regulations of the
Surviving Corporation until duly amended or repealed.
2.3 DIRECTORS AND OFFICERS. The directors of VTN in office immediately
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prior to the Effective Time, together with such additional persons as may
thereafter be elected, shall serve as the directors of the Surviving Corporation
from and after the Effective Time in accordance with the Bylaws of the Surviving
Corporation. The officers of VTN in office immediately prior to the Effective
Time, together with such additional persons as may thereafter be elected, shall
serve as the officers of the Surviving Corporation from and after the Effective
Time in accordance with the Bylaws of the Surviving Corporation.
ARTICLE 3
MANNER OF CONVERTING SHARES
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3.1 CONVERSION OF SHARES. Subject to the provisions of this Article 3,
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at the Effective Time, by virtue of the Merger and without any action on the
part of Premiere, VTN, or the stockholders of the foregoing, the shares of the
following corporations shall be converted as follows:
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(a) Each share of Premiere Common Stock issued and outstanding immediately
prior to the Effective Time shall remain issued and outstanding from and after
the Effective Time.
(b) Each share of Sub Common Stock issued and outstanding immediately
prior to the Effective time shall cease to be outstanding and shall be converted
into one share of VTN Common Stock.
(c) Each share of VTN Common Stock (excluding shares held by any VTN
Entity or any Premiere Entity, and excluding shares held by stockholders who
perfect their statutory dissenters' rights as provided in Section 3.4) issued
and outstanding immediately prior to the Effective Time shall cease to be
outstanding and shall be converted into and exchanged for:
(i) the number of shares of Premiere Common Stock (rounded to the
nearest hundredth of a share) determined by dividing the product of (A)
either (1) .77 if the Amway Convertible Note is converted or (2) .71 if
the Amway Convertible Note is not converted and (B) the Per Share Purchase
Price, by the Average Closing Price (the "Firm Exchange Ratio");
(ii) (subject to the provisions of Section 4.3) the number of shares
of Premiere Common Stock (rounded to the nearest hundredth of a share)
determined by dividing the product of .1 and the Per Share Purchase Price
by the Average Closing Price (the "General Escrow Exchange Ratio");
(iii) (subject to the provisions of Section 4.3) the number of shares
of Premiere Common Stock (rounded to the nearest hundredth of a share)
determined by dividing the product of (A) either (1) .13 if the Amway
Convertible Note is converted or (2) .19 if the Amway Convertible Note is
not converted and (B) the Per Share Purchase Price, by the Average Closing
Price (the "Specific Escrow Exchange Ratio" and, together with the Firm
Exchange Ratio and the General Exchange Ratio, the "Exchange Ratio").
(d) For purposes of the calculation under 3.1(c):
(i) the Per Share Purchase Price shall mean that value obtained by
dividing the VTN Purchase Price by the number of shares of VTN Common
Stock issued and outstanding immediately prior to the Effective Time;
(ii) the VTN Purchase Price shall mean $5,320,000, less (A) the
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positive amount, if any, by which the aggregate level of Consolidated
Indebtedness of VTN at November 30, 1996 (excluding the Amway Convertible
Note, but including $740,000 due to the NAP pursuant to the Grand Solution
Documents) exceeds $1,431,000, (B) the positive amount, if any, by which
the aggregate amount expended, incurred or committed by VTN to purchase or
redeem any shares of VTN
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Common Stock after November 30, 1996 (including purchases and
redemptions contemplated in Section 9.2(k)) exceed $288,000, (C) the
positive amount, if any, by which the aggregate amounts expended,
incurred or committed by VTN and VTNLP or any of their Subsidiaries
from May 1, 1995 though and including the Effective Time for fees and
expenses of attorneys, accountants, investment bankers, and other
consultants and travel, entertainment, printing and other out of
pocket costs associated with the actions taken and transactions
considered pursuant to the engagement by VTN of Salomon Brothers Inc.
described on Schedule 3.1(d) of the VTN Disclosure Memorandum,
including, without limitation, the transactions contemplated with the
parties described on Schedule 3.1(d) of the VTN Disclosure Memorandum,
exceed $1,500,000, (D) except to the extent specifically reflected in
the adjustments to the VTN Purchase Price pursuant to clauses (B) or
(C) above or to the extent specifically reflected in the adjustments
to the VTN Purchase Price under Section 3.1(d) of the VTN Merger
Agreement, the aggregate amount paid, payable or otherwise incurred or
to be incurred in connection with satisfying the obligations of VTN
and the Stockholders or the conditions precedent to the obligation of
Premiere, in each case, whether contained in this Agreement or in any
agreement, certificate or instrument entered into or delivered in
connection herewith, including, without limitation, satisfying the
conditions set forth in Section 9.2(i) and resolving the claim
referred to in Section 92(m), and (E) .23 times the aggregate
principal balance of the Amway Convertible Note if the Amway
Convertible Note is not converted; and
(iii) the Average Closing Price shall mean the average of
the daily last sale prices for the shares of Premiere Common Stock for
the twenty (20) consecutive trading days on which such shares are
actually traded as over-the-counter securities and quoted on the
Nasdaq National Market (as reported by The Wall Street Journal or, if
not reported thereby, any other authoritative source selected by
Premiere) ending at the close of trading on the second trading day
immediately preceding the Closing Date) provided, that for purposes of
this calculation, the Average Closing Price shall be deemed to equal
(i) $30.50 in the event the Average Closing Price is greater than
$30.50 or (ii) $22.50 in the event the Average Closing Price is less
than $22.50 (together, $30.50 and $22.50 are referred to as the
"Average Closing Price Limitations").
3.2. ANTI-DILUTION PROVISIONS. In the event Premiere changes the
------------------------
number of shares of Premiere Common Stock issued and outstanding prior to the
Effective Time as a result of a stock split, stock dividend, or similar
recapitalization with respect to such stock and the record date therefor (in the
case of a stock dividend) or the effective date thereof (in the case of a stock
split or similar recapitalization for which a record date is not established)
shall be after the Exchange Ratio has been determined in accordance with Section
31(c). In that event, prior to the Effective Time, (i) the Exchange Ratio and
the Average Closing Price Limitations shall be proportionately to the effect of
the stock split, stock dividend or recapitalization on the outstanding shares of
Premiere Common Stock adjusted, and (ii) if necessary, the anticipated Effective
Time shall be postponed for an appropriate period of time agreed upon by the
parties in
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order for the Average Closing Price to reflect the market effect of
such stock split, stock dividend, or similar recapitalization. Notwithstanding
the foregoing, Premiere covenants not to effect a stock split, stock dividend or
recapitalization prior to the Effective Time.
3.3 SHARES HELD BY VTN OR PREMIERE. Each of the shares of VTN Common
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Stock held by any VTN Entity or by any Premiere Entity shall be canceled and
retired at the Effective Time and no consideration shall be issued in exchange
therefor.
3.4 DISSENTING STOCKHOLDERS. Each of the Stockholders agrees that it
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will not seek to assert dissenters' rights to which such Stockholder otherwise
would be entitled.
3.5 FRACTIONAL SHARES. Notwithstanding any other provision of this
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Agreement, each holder of shares of VTN Common Stock exchanged pursuant to the
Merger who would otherwise have been entitled to receive a fraction of a share
of Premiere Common Stock (after taking into account all certificates delivered
by such holder) shall receive, in lieu thereof, cash (without interest) in an
amount equal to such fractional part of a share of Premiere Common Stock
multiplied by the Average Closing Price used to establish the Exchange Ratio. No
such holder will be entitled to dividends, voting rights, or any other rights as
a stockholder in respect of any fractional shares.
3.6 STOCK OPTIONS.
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(a) As of the Effective Time, each of the stock options listed in
Section 5.4(b) of the VTN Disclosure Memorandum (the "VTN Stock Options") which
is outstanding as of the date hereof and has not expired as of the Effective
Time shall be assumed by Premiere and converted into an option (or a new
substitute option shall be granted) to purchase the number of shares of Premiere
Common Stock (rounded down to the nearest whole share) equal to the number of
shares of VTN Common Stock subject to the VTN Stock Option multiplied by the
Exchange Ratio at an exercise price per share of Premiere Common Stock (rounded
to the nearest xxxxx) equal to the former exercise price per share of VTN Common
Stock under such option immediately prior to the Effective Time divided by the
Exchange Ratio; provided, however, that in the case of any VTN Stock Option to
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which Section 421 of the Code applies by reason of its qualification under
Section 422 of the Code, the conversion formula shall be adjusted, if necessary,
to comply with Section 424(a) of the Code, provided however, no adjustment shall
be made which could, in the reasonable opinion of Xxxxxx Xxxxxxxx LLP, preclude
pooling of interests accounting treatment for the Merger. Except as provided
above, the converted or substituted options for Premiere Common Stock shall be
subject to substantially the same terms and conditions (including, without
limitation, expiration date, vesting and exercise provisions) as were applicable
to VTN Stock Options immediately prior to the Effective Time. Premiere
acknowledges that all outstanding VTN Stock Options specifically disclosed
herein will become fully vested immediately prior to the Effective Time in
accordance with the terms of the agreements relating thereto, except to the
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extent that any such vesting would preclude pooling of interest accounting
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treatment for the Merger.
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(b) Premiere agrees that (i) within fifteen (15) days after the Effective
Time it will cause to be filed one or more registration statements on Form S-8
under the Securities Act, or amendments to its existing registration statements
on Form S-8 or amendments to such other registration statements as may be
available, in order to register the Premiere Common Stock issuable upon exercise
of the aforesaid converted VTN Stock Options (the "Underlying Stock"), provided,
however, that no such Form S-8 is required to be filed if Premiere has
registered sufficient shares under its current S-8 to cover all the Underlying
Stock plus all shares underlying stock options currently outstanding and
issuable not otherwise exempt from registration, and (ii) at or prior to the
Effective Time, Premiere shall take all corporate action necessary to reserve
for issuance a sufficient number of shares of Premiere Common Stock for delivery
upon exercise of the options substituted pursuant to this Section 3.6. The
consummation of the Merger shall not be treated as a termination of employment
for purposes of the VTN Option Plans.
ARTICLE 4
EXCHANGE OF SHARES
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4.1 EXCHANGE PROCEDURES. Promptly after the Effective Time, Premiere
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and VTN shall cause SunTrust, the exchange agent selected by Premiere (the
"Exchange Agent"), to mail to each holder of record of a certificate or
certificates which represented shares of VTN Common Stock immediately prior to
the Effective Time (the "Certificates") or, at the election of the respective
Stockholders, deliver to the Stockholder or his or its duly appointed
representative at the Closing appropriate transmittal materials and instructions
(which shall specify that delivery shall be effected, and risk of loss and title
to such Certificates shall pass, only upon proper delivery of such Certificates
to the Exchange Agent). The Certificate or Certificates of VTN Common Stock so
delivered shall be duly endorsed as the Exchange Agent may require. In the event
of a transfer of ownership of shares of VTN Common Stock represented by
Certificates that are not registered in the transfer records of VTN, the
consideration provided in Section 3.1 may be issued to a transferee if the
Certificates representing such shares are delivered to the Exchange Agent,
accompanied by all documents required to evidence such transfer and by evidence
reasonably satisfactory to the Exchange Agent that any applicable stock transfer
taxes have been paid. If any Certificate shall have been lost, stolen, mislaid
or destroyed, upon receipt of (i) an affidavit of that fact from the holder
claiming such Certificate to be lost, mislaid, stolen or destroyed, (ii) such
bond, security or indemnity as Premiere and the Exchange Agent may reasonably
require and (iii) any other documents necessary to evidence and effect the bona
fide exchange thereof, the Exchange Agent shall issue to such holder the
consideration into which the shares represented by such lost, stolen, mislaid or
destroyed Certificate shall have been converted. The Exchange Agent may
establish such other reasonable and customary rules and procedures in connection
with its duties as it may deem appropriate. On or promptly following the
Effective Time, each holder of shares of VTN Common Stock (other than shares to
be canceled pursuant to Section 3.3 or as to which statutory dissenters' rights
have been perfected as provided in Section 3.4) issued and outstanding at the
Effective Time shall surrender the Certificate or Certificates representing such
shares to the Exchange Agent and shall promptly upon surrender thereof (and at
the Closing if so requested by the Stockholder) receive in exchange therefor the
consideration provided in Section 3.1, together with all undelivered dividends
or distributions in respect of such
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shares (without interest thereon) pursuant to Section 4.2. To the extent
required by Section 3.5, each holder of shares of VTN Common Stock issued and
outstanding at the Effective Time also shall receive, upon surrender of the
Certificate or Certificates, cash in lieu of any fractional share of Premiere
Common Stock to which such holder may be otherwise entitled (without interest).
Premiere shall not be obligated to deliver the certificates for or other
consideration to which any former holder of VTN Common Stock is entitled as a
result of the Merger until such holder surrenders such holder's Certificate or
Certificates for exchange as provided in this Section 4.1. Any other provision
of this Agreement notwithstanding, neither Premiere nor the Exchange Agent shall
be liable to a holder of VTN Common Stock for any amounts paid or property
delivered in good faith to a public official pursuant to any applicable
abandoned property, escheat or similar Law. Adoption of this Agreement by the
stockholders of VTN shall constitute ratification of the appointment of the
Exchange Agent.
4.2 RIGHTS OF FORMER VTN STOCKHOLDERS. At the Effective Time, the
---------------------------------
stock transfer books of VTN shall be closed as to holders of VTN Common Stock
immediately prior to the Effective Time and no transfer of VTN Common Stock by
any such holder shall thereafter be made or recognized. Until surrendered for
exchange in accordance with the provisions of Section 41, each Certificate
theretofore representing shares of VTN Common Stock (other than shares to be
canceled pursuant to Sections 33 and 34) shall from and after the Effective
Time represent for all purposes only the right to receive the consideration
provided in Sections 31 and 35 in exchange therefor,. To the extent permitted
by Law, former stockholders of record of VTN shall be entitled to vote after the
Effective Time at any meeting of Premiere stockholders the number of whole
shares of Premiere Common Stock into which their respective shares of VTN Common
Stock are converted, regardless of whether such holders have exchanged their
Certificates for certificates representing Premiere Common Stock in accordance
with the provisions of this Agreement. Whenever a dividend or other distribution
is declared by Premiere on the Premiere Common Stock, the record date for which
is at or after the Effective Time, the declaration shall include dividends or
other distributions on all shares of Premiere Common Stock issuable pursuant to
this Agreement, but no dividend or other distribution payable to the holders of
record of Premiere Common Stock as of any time subsequent to the Effective Time
shall be delivered to the holder of any Certificate until such holder surrenders
such Certificate for exchange as provided in Section 4.1. However, upon
surrender of such Certificate, both the Premiere Common Stock certificate
(together with all such undelivered dividends or other distributions without
interest) and any undelivered dividends and cash payments payable hereunder
(without interest) shall be delivered and paid with respect to each share
represented by such Certificate.
4.3 ESCROW AGREEMENT. In connection with the Closing, Premiere and
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the Stockholders shall have executed and delivered to the other an escrow
agreement (the "General Escrow Agreement"), which shall be in the form of
Exhibit 1 and another escrow agreement (the "Specific Escrow Agreement"), which
shall be in the form of Exhibit 2. The shares of Premiere Common Stock to be
issued pursuant to Section 31(c)(ii) shall be issued and held by SunTrust, as
escrow agent pursuant to the terms of the General Escrow Agreement, and the
shares of Premiere Common Stock to be issued pursuant to Section 3.1(c)(iii)
shall be issued and held by SunTrust, as escrow agent pursuant to the terms of
the Specific Escrow Agreement..
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4.4 LEGENDING OF SECURITIES; POOLING RESTRICTIONS. Each certificate
---------------------------------------------
for Premiere Common Stock to be issued to the Stockholders as part of the
Purchase Price shall bear the following legend:
"The securities represented hereby have not been registered under the
Securities Act of 1933, as amended, and may not be offered, sold,
transferred or otherwise disposed of unless registered with the Securities
and Exchange Commission of the United States and the securities regulatory
authorities of applicable states or unless an exemption from such
registration is available."
Because the Merger will be accounted for using the pooling-of-interests method
of accounting, each Stockholder agrees that such Stockholder will not sell,
transfer or otherwise reduce such Stockholder's risks relative to the shares of
VTN Common Stock held by such Stockholder, except as contemplated by this
Agreement, and will not sell, transfer or otherwise reduce such Stockholder's
risk relative to the shares of Premiere Common Stock to be received by each
Stockholder upon consummation of the Merger until such time as Premiere notifies
the undersigned that the requirements of SEC Accounting Series Release Nos. 130
and 135 ("ASR 130 and 135") have been met. Each Stockholder understands that
ASR 130 and 135 relate to publication of financial results of post-Closing
combined operations of Premiere and VTN covering a period of at least 30 days of
post-Closing combined operating results. Premiere agrees that it will publish
such results within 45 days after the end of the first fiscal quarter of
Premiere containing the required period of post-Closing combined operations and
that it will notify the undersigned promptly following such publication.
Premiere shall be entitled to place restrictive legends on the shares of
Premiere Common Stock issued to the Stockholders pursuant to the Merger to
enforce the foregoing restrictions.
ARTICLE 5
REPRESENTATIONS AND WARRANTIES OF VTN AND THE STOCKHOLDERS
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The Stockholders and VTN, jointly and severally, hereby represent and
warrant to Premiere as follows (provided that Amway, as a Stockholder of VTN,
makes only the representations and warranties in Section 5.28 and unless
otherwise noted, for purposes of this Article 5, the term "Stockholder" does not
include Amway):
5.1 ORGANIZATION, STANDING, AND POWER. VTN is a corporation duly
---------------------------------
organized, validly existing, and in good standing under the Laws of the State of
Ohio, and has the corporate power and authority to carry on its business as now
conducted and to own, lease and operate its Assets. VTN is duly qualified or
licensed to transact business as a foreign corporation in good standing in the
States of the United States and foreign jurisdictions where the character of its
Assets or the nature or conduct of its business requires it to be so qualified
or licensed, except for such jurisdictions in which the failure to be so
qualified or licensed is not reasonably likely to have, individually or in the
aggregate, a VTN Material Adverse Effect. The minute book and other
organizational documents for VTN have been made available to Premiere for its
review and, except as disclosed in Section 5.1 of the VTN Disclosure Memorandum,
are true and complete in
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all material respects as in effect as of the date of this Agreement and
accurately reflect in all material respects all amendments thereto and all
proceedings of the Board of Directors and stockholders thereof.
5.2 AUTHORITY OF VTN; NO BREACH BY AGREEMENT.
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(a) VTN has the corporate power and authority necessary to
execute, deliver, and perform its obligations under this Agreement and to
consummate the transactions contemplated hereby. The execution, delivery,
and performance of this Agreement and the consummation of the transactions
contemplated herein, including the Merger, have been duly and validly
authorized by all necessary corporate action in respect thereof on the part
of VTN, subject to the approval of this Agreement by the holders of a
majority of the outstanding shares of VTN Common Stock, which is the only
stockholder vote required for approval of this Agreement and consummation
of the Merger by VTN. Subject to such requisite stockholder approval, this
Agreement represents a legal, valid, and binding obligation of VTN,
enforceable against VTN in accordance with its terms (except in all cases
as such enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, receivership, conservatorship, moratorium, or similar Laws
affecting the enforcement of creditors' rights generally and except that
the availability of the equitable remedy of specific performance or
injunctive relief is subject to the discretion of the court before which
any proceeding may be brought).
(b) Neither the execution and delivery of this Agreement by VTN,
nor the consummation by VTN of the transactions contemplated hereby, nor
compliance by VTN with any of the provisions hereof, will (i) conflict with
or result in a breach of any provision of VTN's Certificate of
Incorporation or Bylaws or the certificate or agreement of limited
partnership of VTNLP or any resolution adopted by the board of directors or
the stockholders or the partners of any VTN Entity, or (ii) except as
disclosed in Section 5.2 of the VTN Disclosure Memorandum, constitute or
result in a Default under, or require any Consent pursuant to, or result in
the creation of any Lien on any Asset of any VTN Entity under, any Contract
or Permit of any VTN Entity, where such Default or Lien, or any failure to
obtain such Consent, is reasonably likely to have, individually or in the
aggregate, a VTN Material Adverse Effect, or, (iii) subject to receipt of
the requisite Consents referred to in Section 9.1(b), constitute or result
in a Default under, or require any Consent pursuant to, any Law or Order
applicable to any VTN Entity or any of their respective material Assets
(including any Premiere Entity or any VTN Entity becoming subject to or
liable for the payment of any Tax or any of the Assets owned by any
Premiere Entity or any VTN Entity being reassessed or revalued by any
Taxing authority).
(c) Other than filing of a Certificate of Merger with the
Secretary of State of the State of Ohio, no notice to, filing with, or
Consent of, any public body or authority is necessary for the consummation
by VTN of the Merger and the other transactions contemplated in this
Agreement.
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5.3 AUTHORITY OF STOCKHOLDERS; NO BREACH BY AGREEMENT.
-------------------------------------------------
(a) Each of the Stockholders has the absolute and unrestricted
right, power, authority, and capacity to execute and deliver this Agreement
and the Stockholders' Closing Documents and to perform its obligations
under this Agreement and the Stockholders' Closing Documents. This
Agreement represents a legal, valid, and binding obligation of each
Stockholder, enforceable against each Stockholder in accordance with its
terms (except in all cases as such enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, receivership,
conservatorship, moratorium, or similar Laws affecting the enforcement of
creditors' rights generally and except that the availability of the
equitable remedy of specific performance or injunctive relief is subject to
the discretion of the court before which any proceeding may be brought).
Upon the execution and delivery by the Stockholders of the Stockholders'
Closing Documents, the Stockholders' Closing Documents will constitute the
legal, valid, and binding obligations of each Stockholder, enforceable
against each Stockholder in accordance with their respective terms.
(b) Neither the execution and delivery of this Agreement by any
Stockholder, nor the consummation by any Stockholder of the transactions
contemplated hereby, nor compliance by any Stockholder with any of the
provisions hereof, will (i) conflict with or result in a breach of any
provision of VTN's Certificate of Incorporation or Bylaws or the
certificate or agreement of limited partnership of VTNLP or the governing
instruments of any Stockholder that is not a natural person, or (ii) except
as disclosed in Section 5.3 of the VTN Disclosure Memorandum, constitute or
result in a Default under, or require any Consent pursuant to, or result in
the creation of any Lien on any Asset of any VTN Entity under, any Contract
or Permit of any VTN Entity, where such Default or Lien, or any failure to
obtain such Consent, is reasonably likely to have, individually or in the
aggregate, a VTN Material Adverse Effect, or, (iii) subject to receipt of
the requisite Consents referred to in Section 9.1(b), violate any Law or
Order applicable to any Stockholder or to any VTN Entity or any of their
respective material Assets.
(c) No notice to, filing with, or Consent of, any public body or
authority is necessary for the consummation by the Stockholders of the
transactions contemplated in this Agreement.
5.4 CAPITAL STOCK
-------------
(a) The authorized capital stock of VTN consists of 750 shares
of VTN Common Stock, of which (i) 625 are designated as Class A shares and
of which 227.50 shares are issued and outstanding as of the date of this
Agreement and not more than 305.75 (assuming the VTN Options are not
exercised before the Effective Time) shares will be issued and outstanding
at the Effective Time and (ii) 125 shares are designated as Class B shares
of which 0 shares are issued and outstanding as of the date of this
Agreement and no shares will be issued and outstanding at the Effective
Time. All of the issued and outstanding shares of capital stock of VTN are
duly and validly issued and outstanding and are fully paid and
nonassessable. None of the outstanding shares of capital stock of VTN
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has been issued in violation of any preemptive rights of the current or
past stockholders of VTN or of the Securities Laws or any state blue sky or
securities Laws.
(b) Except as set forth in Section 5.4(a) or as disclosed in
Section 5.4(b) of the VTN Disclosure Memorandum, there are no shares of
capital stock or other equity securities of VTN outstanding and no
outstanding Equity Rights relating to the capital stock of VTN. Each of the
Stockholders is the owner of all right, title and interest (legal and
beneficial) in and to that number or amount of Shares set forth next to his
name in Section 5.4(a) of the VTN Disclosure Memorandum, free and clear of
all Liens. Collectively, the Stockholders own all right, title and interest
(legal and beneficial) in and to all of the issued and outstanding shares
of VTN's capital stock. Except as specifically contemplated by this
Agreement, no Person has any Contract or any right or privilege (whether
pre-emptive or contractual) capable of becoming a Contract for the purchase
from the Stockholders of any of the Shares, or any Contract or Equity Right
for the purchase, subscription or issuance of any securities of VTN.
5.5 VTN SUBSIDIARIES; VTNLP. VTN has no Subsidiaries. VTNLP is a
-----------------------
limited partnership validly organized under the laws of the State of Delaware.
VTN has disclosed in Section 5.5 of the VTN Disclosure Memorandum each
jurisdiction in which VTNLP is qualified and/or licensed to transact business.
VTN is the sole general partner of VTNLP and MPI is the sole limited partner of
VTNLP. No other partnership interest is or may become required to be issued by
reason of any Equity Rights, and there are no Contracts by which VTNLP is bound
to issue additional units of general or limited partner interest or other equity
interests or Equity Rights or by which VTN is or may be bound to transfer any
units of general or limited partner interest or other equity interests of VTNLP.
There are no Contracts relating to the rights of VTN or MPI to vote or to
dispose of any units of general or limited partner interest or other equity
interests. All of the units of general partner interests in VTNLP are owned by
VTN and all the units of limited partner interests in VTNLP are owned by MPI,
units of general or limited partner interest or other equity interests are fully
paid and nonassessable and are so owned free and clear of any Lien. Except as
disclosed in Section 5.5 of the VTN Disclosure Memorandum, VTNLP is duly
organized and validly existing under the Laws of the Stateof Delaware, and has
the power and authority necessary for it to own, lease, and operate its Assets
and to carry on its business as now conducted. VTNLP is duly qualified or
licensed to transact business as a foreign limited partnership in good standing
in the States of the United States and foreign jurisdictions where the character
of its Assets or the nature or conduct of its business requires it to be so
qualified or licensed, except for such jurisdictions in which the failure to be
so qualified or licensed is not reasonably likely to have, individually or in
the aggregate, a VTN Material Adverse Effect. The minute book and other
organizational documents for VTNLP have been made available to Premiere for its
review, and, except as disclosed in Section 5.5 of the VTN Disclosure
Memorandum, are true and complete in all material respects as in effect as of
the date of this Agreement and accurately reflect in all material respects all
amendments thereto and all proceedings of the partners thereof.
5.6 FINANCIAL STATEMENTS. Each of the VTN Financial Statements
--------------------
(including, in each case, any related notes) was prepared in accordance with
GAAP applied on a consistent
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basis throughout the periods involved (except as may be indicated in the notes
to such financial statements), and fairly presented in all material respects the
consolidated financial position of VTN and its Subsidiaries as at the respective
dates and the consolidated results of operations and cash flows for the periods
indicated, except that the unaudited interim financial statements were or are
subject to normal and recurring year-end adjustments which were not or are not
expected to be material in amount or effect.
5.7. ABSENCE OF UNDISCLOSED LIABILITIES. No VTN Entity has any
----------------------------------
Liabilities that are reasonably likely to have, individually or in the
aggregate, a VTN Material Adverse Effect, except Liabilities which are accrued
or reserved against in the consolidated balance sheet of VTN as of December 31,
1996 included in the VTN Financial Statements delivered prior to the date of
this Agreement or reflected in the notes thereto. No VTN Entity has incurred or
paid any Liability since December 31, 1996, except for such Liabilities incurred
or paid (i) in the ordinary course of business consistent with past business
practice and which are not reasonably likely to have, individually or in the
aggregate, a VTN Material Adverse Effect or (ii) in connection with the
transactions contemplated by this Agreement. Except as disclosed in Section 5.7
of the VTN Disclosure Memorandum, no VTN Entity is directly or indirectly
liable, by guarantee, indemnity, or otherwise, upon or with respect to, or
obligated, by discount or repurchase agreement or in any other way, to guarantee
or assume any Liability of any Person for any amount in excess of $10,000.
5.8 ABSENCE OF CERTAIN CHANGES OR EVENTS. Since December 31, 1996,
------------------------------------
except as disclosed in the VTN Financial Statements delivered prior to the date
of this Agreement or as disclosed in Section 5.8 of the VTN Disclosure
Memorandum, (i) there have been no events, changes, or occurrences which have
had, or are reasonably likely to have, individually or in the aggregate, a VTN
Material Adverse Effect, and (ii) the VTN Entities have not taken any action, or
failed to take any action, prior to the date of this Agreement, which action or
failure, if taken after the date of this Agreement, would represent or result in
a material breach or violation of any of the covenants and agreements of VTN
provided in Article 7.
5.9 TAX MATTERS.
-----------
(a) All Tax Returns required to be filed by or on behalf of any
of the VTN Entities have been timely filed (including without limitation
Tax Returns filed in accordance with extensions granted) or requests for
extensions have been timely filed, granted, and have not expired for
periods ended on or before December 31, 1996, and on or before the date of
the most recent fiscal year end immediately preceding the Effective Time,
and all Tax Returns filed are complete and accurate in all material
respects. All Taxes shown on filed Tax Returns have been paid. As of the
date of this Agreement, there is no audit examination, deficiency, or
refund Litigation with respect to any Taxes, except as reserved against in
the VTN Financial Statements delivered prior to the date of this Agreement
or as disclosed in Section 5.9 of the VTN Disclosure Memorandum. VTN's
federal income Tax Returns have been audited by the IRS and accepted
through December 31, 1991. All Taxes and other Liabilities due with respect
to completed and settled examinations or concluded Litigation have been
paid. There are no Liens with respect to Taxes upon any of the Assets
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of the VTN Entities, except for any such Liens which are not reasonably
likely to have a VTN Material Adverse Effect.
(b) None of the VTN Entities has executed an extension or waiver
of any statute of limitations on the assessment or collection of any Tax
due (excluding such statutes that relate to years currently under
examination by the Internal Revenue Service or other applicable taxing
authorities) that is currently in effect.
(c) The provision for any Taxes due or to become due for any of
the VTN Entities for the period or periods through and including the date
of the most recent VTN Financial Statements that has been made and is
reflected on such VTN Financial Statements is sufficient to cover all such
Taxes.
(d) Deferred Taxes of the VTN Entities have been provided for in
accordance with GAAP.
(e) None of the VTN Entities is a party to any Tax allocation or
sharing agreement and none of the VTN Entities has been a member of an
affiliated group filing a consolidated federal income Tax Return (other
than a group the common parent of which was VTN) has any Liability for
Taxes of any Person (other than VTN and its Subsidiaries) under Treasury
Regulation Section 1.1502-6 (or any similar provision of state, local or
foreign Law) as a transferee or successor or by Contract or otherwise.
(f) Each of the VTN Entities is in compliance with, and its
records contain all information and documents (including properly completed
IRS Forms W-9) necessary to comply with, all applicable information
reporting and Tax withholding requirements under federal, state, and local
Tax Laws.
(g) Except as disclosed in Section 5.9 of the VTN Disclosure
Memorandum, none of the VTN Entities has made any payments, is obligated to
make any payments, or is a party to any Contract that could obligate it to
make any payments that could be disallowed as a deduction under Section
280G or 162(m) of the Internal Revenue Code.
(h) Except as disclosed in Section 5.9 of the VTN Disclosure
Memorandum, no VTN Entity has or has had in any foreign country a permanent
establishment, as defined in any applicable tax treaty or convention
between the United States and such foreign country.
5.10 ASSETS.
------
(a) Except as disclosed in Section 5.10 of the VTN Disclosure
Memorandum or as disclosed or reserved against in the VTN Financial
Statements delivered prior to the date of this Agreement, the VTN Entities
have good and marketable title, free and clear of all Liens, to all of
their respective Assets, except for any such Liens or other defects of
title which are not reasonably likely to have a VTN Material Adverse
Effect. All tangible
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properties used in the businesses of the VTN Entities are in good
condition, reasonable wear and tear excepted, and are usable in the
ordinary course of business consistent with VTN's past practices.
(b) All items of inventory of the VTN Entities reflected on the
most recent balance sheet included in the VTN Financial Statements
delivered prior to the date of this Agreement and prior to the Effective
Time consisted and will consist, as applicable, of items of a quality and
quantity usable and saleable in the ordinary course of business and conform
to generally accepted standards in the industry in which the VTN Entities
are a part.
(c) The accounts receivable of the VTN Entities as set forth on
the most recent balance sheet included in the VTN Financial Statements
delivered prior to the date of this Agreement or arising since the date
thereof are valid and genuine; have arisen solely out of bona fide sales
and deliveries of goods, performance of services and other business
transactions in the ordinary course of business consistent with past
practice; are not subject to valid defenses, set-offs or counterclaims; and
are collectible within 90 days after billing at the full recorded amount
thereof less, in the case of accounts receivable appearing on the most
recent balance sheet included in the VTN Financial Statements delivered
prior to the date of this Agreement, the recorded allowance for collection
losses on such balance sheet. The allowance for collection losses on such
balance sheet has been determined in accordance with GAAP.
(d) All Assets which are material to VTN's business on a
consolidated basis, held under leases or subleases by any of the VTN
Entities, are held under valid Contracts enforceable in accordance with
their respective terms (except as enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium, or other
Laws affecting the enforcement of creditors' rights generally and except
that the availability of the equitable remedy of specific performance or
injunctive relief is subject to the discretion of the court before which
any proceedings may be brought) and each such Contract is in full force and
effect.
(e) The VTN Entities currently maintain insurance similar in
amounts, scope, and coverage to that maintained by other peer
organizations. None of the VTN Entities has received notice from any
insurance carrier that (i) any policy of insurance will be canceled or that
coverage thereunder will be reduced or eliminated, or (ii) premium costs
with respect to such policies of insurance will be substantially increased.
There are presently no claims for amounts exceeding in any individual case
$10,000 pending under such policies of insurance and no notices of claims
in excess of such amounts have been given by any VTN Entity under such
policies.
(f) The Assets of the VTN Entities include all Assets required
to operate the business of the VTN Entities as presently conducted.
-14-
5.11 INTELLECTUAL PROPERTY.
---------------------
(a) Section 5.11(a)(i) of the VTN Disclosure Memorandum sets
forth (i) a brief description of each VTN Intellectual Property Right, and
(ii) with respect to each VTN Intellectual Property Right registered or
capable of registration with any Regulatory Authority or for which an
application for registration has been filed with any Regulatory Authority,
the names of the jurisdictions covered by the applicable registration or
application, if any. Section 5.11(a)(ii) of the VTN Disclosure Memorandum
identifies and provides a brief description of each Intellectual Property
Right licensed to any VTN Entity by any Person (except for any Intellectual
Property Right that is licensed to any VTN Entity under any third party
software license generally available to the public at a cost of less than
Ten Thousand Dollars ($10,000)), and identifies the license agreement under
which such Intellectual Property Right is being licensed to such VTN
Entity. No VTN Entity is in Default under any such license agreements.
Except as set forth in Section 5.11(a)(iii) of the VTN Disclosure
Memorandum, the VTN Entities have, and following consummation of the
transactions contemplated hereby, shall have valid and marketable title to
all VTN Intellectual Property Rights used in or reasonably necessary for
the conduct of their business free and clear of all liens and other
encumbrances, except for third party Intellectual Property Rights licensed
to any such VTN Entity, as to which it has a valid right to use with
respect to such VTN Intellectual Property Rights. No present or former
employee or owner of any VTN Entity and no other Person owns or has any
proprietary, financial or other interest, direct or indirect, in whole or
in part, in any Intellectual Property Right which any VTN Entity owns,
possesses or uses in its operations as now or heretofore conducted. All
personnel, including employees, agents, consultants, and contractors, who
have contributed to or participated in the conception and development of
any VTN Intellectual Property Right (i) have been party to a "work-for-
hire" relationship with a VTN Entity that has accorded the VTN Entity full,
effective, and exclusive original ownership of all tangible and intangible
property thereby arising with respect to such VTN Intellectual Property
Right, and/or (ii) have executed appropriate instruments of assignment or
license in favor of a VTN Entity as assignee that have conveyed to a VTN
Entity full, effective, and exclusive ownership or use of all tangible and
intangible property thereby arising with respect to such VTN Intellectual
Property Right. Except as set forth in Section 5.11(a)(iv) of the VTN
Disclosure Memorandum, no VTN Entity is obligated to make any material
payment to any Person for the use of any VTN Intellectual Property Right.
Except as set forth in Section 5.11(a)(v) of the VTN Disclosure Memorandum,
no VTN Entity has developed jointly with any other Person any VTN
Intellectual Property Right with respect to which such other Person has any
rights. Each VTN Entity is the owner of or has a license to any
Intellectual Property Right sold or licensed to a third party by such VTN
Entity in connection with such VTN Entity's business operations, and such
VTN Entity has the right to convey by sale or license any Intellectual
Property Rights so conveyed.
(b) Except as set forth in Section 5.11(b) of the VTN Disclosure
Memorandum, each VTN Entity has taken all reasonable and customary measures
and precautions necessary to protect and maintain the confidentiality and
secrecy of all VTN Intellectual Property Rights (except VTN Intellectual
Property Rights whose value would be unimpaired by public disclosure) and
otherwise to maintain and protect the value of all VTN
-15-
Intellectual Property Rights. Except as set forth in Section 5.11(b) of the
VTN Disclosure Memorandum, no VTN Entity has disclosed or delivered, or
permitted the disclosure or delivery to any Person of the source code, or
any portion or aspect of the source code, of any VTN Intellectual Property
Rights.
(c) No VTN Entity is infringing, misappropriating or making any
unlawful use of, and no VTN Entity has at any time infringed,
misappropriated or made any unlawful use of, and, except as set forth in
Section 5.11(c) of the VTN Disclosure Memorandum, no VTN Entity has
received any notice or other communication (in writing or otherwise) of any
actual, alleged, possible or potential infringement, misappropriation or
unlawful use of, any Intellectual Property Right owned or used by any other
Person. To the Knowledge of VTN, no other Person is infringing,
misappropriating or making any unlawful use of, and no Intellectual
Property Right owned or used by any other Person infringes or conflicts
with, any VTN Intellectual Property Right.
(d) The VTN Intellectual Property Rights constitute all the
Intellectual Property Rights reasonably deemed necessary to enable any VTN
Entity to conduct its business in the manner in which such business has
been and is being conducted. No VTN Entity has licensed any of the VTN
Intellectual Property Rights to any Person on an exclusive basis and,
except as set forth in Section 5.11(d) of the VTN Disclosure Memorandum, no
VTN Entity has entered into any covenant not to compete or Contract
limiting its ability to exploit fully any of the VTN Intellectual Property
Rights or to transact business in any market or geographical area or with
any Person.
(e) Except as disclosed in Section 5.11(e) of the VTN Disclosure
Memorandum, every officer, director, or employee of any VTN Entity is a
party to a Contract which requires such officer, director or employee to
assign any interest in any Intellectual Property Right to any VTN Entity
and to keep confidential any trade secrets, proprietary data, customer
information, or other business information of any VTN Entity, and no such
officer, director or employee is party to any Contract with any Person
other than a VTN Entity which requires such officer, director or employee
to assign any interest in any Intellectual Property Right to any Person
other than a VTN Entity or to keep confidential any trade secrets,
proprietary data, customer information, or other business information of
any Person other than a VTN Entity. Except as disclosed in Section 5.11(e)
of the VTN Disclosure Memorandum, no officer, director or employee of any
VTN Entity is party to any Contract which restricts or prohibits such
officer, director or employee from engaging in activities competitive with
any Person, including any VTN Entity.
5.12 ENVIRONMENTAL MATTERS
---------------------
(a) Each VTN Entity, its Participation Facilities, and its
Operating Properties are, and have been, in compliance with all
Environmental Laws, except for violations which are not reasonably likely
to have, individually or in the aggregate, a VTN Material Adverse Effect.
-16-
(b) There is no Litigation pending or, to the Knowledge of VTN,
threatened before any court, governmental agency, or authority or other
forum in which any VTN Entity or any of its Operating Properties or
Participation Facilities (or VTN in respect of such Operating Property or
Participation Facility) has been or, with respect to threatened Litigation,
may be named as a defendant (i) for alleged noncompliance (including by any
predecessor) with any Environmental Law or (ii) relating to the release,
discharge, spillage, or disposal into the environment of any Hazardous
Material, whether or not occurring at, on, under, adjacent to, or affecting
(or potentially affecting) a site owned, leased, or operated by any VTN
Entity or any of its Operating Properties or Participation Facilities,
except for such Litigation pending or threatened that is not reasonably
likely to have, individually or in the aggregate, a VTN Material Adverse
Effect, nor is there any reasonable basis for any Litigation of a type
described in this sentence, except such as is not reasonably likely to
have, individually or in the aggregate, a VTN Material Adverse Effect.
(c) During the period of (i) any VTN Entity's ownership or operation
of any of their respective current properties, (ii) any VTN Entity's
participation in the management of any Participation Facility, or (iii) any
VTN Entity's holding of a security interest in a Operating Property, there
have been no releases, discharges, spillages, or disposals of Hazardous
Material in, on, under, adjacent to, or affecting (or potentially
affecting) such properties, except such as are not reasonably likely to
have, individually or in the aggregate, a VTN Material Adverse Effect.
Prior to the period of (i) any VTN Entity's ownership or operation of any
of their respective current properties, (ii) any VTN Entity's participation
in the management of any Participation Facility, or (iii) any VTN Entity's
holding of a security interest in a Operating Property, there were no
releases, discharges, spillages, or disposals of Hazardous Material in, on,
under, or affecting any such property, Participation Facility or Operating
Property, except such as are not reasonably likely to have, individually or
in the aggregate, a VTN Material Adverse Effect.
5.13 COMPLIANCE WITH LAWS. Except as disclosed in Section 5.13 of the
--------------------
VTN Disclosure Memorandum, since January 1, 1986, each VTN Entity has had in
effect all Permits necessary for it to own, lease, or operate its material
Assets and to carry on its business as it has been, and as it is currently,
conducted, except for those Permits the absence of which are not reasonably
likely to have, individually or in the aggregate, a VTN Material Adverse Effect,
and there has occurred no Default under any such Permit, other than Defaults
which are not reasonably likely to have, individually or in the aggregate, a VTN
Material Adverse Effect. Except as disclosed in Section 5.13 of the VTN
Disclosure Memorandum, none of the VTN Entities:
(a) is in Default under any of the provisions of its Certificate
of Incorporation or Bylaws (or other governing instruments);
(b) is in Default under any Laws, Orders, or Permits applicable
to its business or employees conducting its business, except for Defaults
which are not reasonably likely to have, individually or in the aggregate,
a VTN Material Adverse Effect; or
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(c) since January 1, 1993, has received any notification or
communication from any agency or department of federal, state, or local
government or any Regulatory Authority or the staff thereof (i) asserting
that any VTN Entity is not in compliance with any of the Laws or Orders
which such governmental authority or Regulatory Authority enforces, where
such noncompliance is reasonably likely to have, individually or in the
aggregate, a VTN Material Adverse Effect, (ii) threatening to revoke any
Permits, the revocation of which is reasonably likely to have, individually
or in the aggregate, a VTN Material Adverse Effect, or (iii) requiring any
VTN Entity to enter into or consent to the issuance of a cease and desist
order, formal agreement, directive, commitment, or memorandum of
understanding, or to adopt any Board resolution or similar undertaking.
Copies of all material reports, correspondence, notices and other documents
relating to any inspection, audit, monitoring or other form of review or
enforcement action by a Regulatory Authority have been made available to
Premiere.
5.14. LABOR RELATIONS. No VTN Entity is the subject of any Litigation
---------------
asserting that it or any other VTN Entity has committed an unfair labor practice
(within the meaning of the National Labor Relations Act or comparable state law)
or seeking to compel it or any other VTN Entity to bargain with any labor
organization as to wages or conditions of employment, nor is any VTN Entity
party to any collective bargaining agreement, nor is there any strike or other
labor dispute involving any VTN Entity, pending or threatened, or to the
Knowledge of VTN, is there any activity involving any VTN Entity's employees
seeking to certify a collective bargaining unit or engaging in any other
organization activity.
5.15 EMPLOYEE BENEFIT PLANS.
----------------------
(a) VTN has disclosed in Section 5.15 of the VTN Disclosure
Memorandum, and has delivered or made available to Premiere prior to the
execution of this Agreement copies in each case of, all pension,
retirement, profit-sharing, deferred compensation, stock option, employee
stock ownership, severance pay, vacation, bonus, or other incentive plan,
all other written employee programs, arrangements, or agreements, all
medical, vision, dental, or other health plans, all life insurance plans,
and all other employee benefit plans or fringe benefit plans, including
"employee benefit plans" as that term is defined in Section 3(3) of ERISA,
currently adopted, maintained by, sponsored in whole or in part by, or
contributed to by any VTN Entity or ERISA Affiliate thereof for the benefit
of employees, retirees, dependents, spouses, directors, independent
contractors, or other beneficiaries and under which employees, retirees,
dependents, spouses, directors, independent contractors, or other
beneficiaries are eligible to participate (collectively, the "VTN Benefit
Plans"). Any of the VTN Benefit Plans which is an "employee pension benefit
plan," as that term is defined in Section 3(2) of ERISA, other than those
plans described in Section 201(2) of ERISA, is referred to herein as a "VTN
ERISA Plan." No VTN ERISA Plan is subject to Title IV of ERISA. Section
5.15 of the VTN Disclosure Memorandum sets forth a list and brief
description of each VTN Benefit Plan, including a designation of whether
such VTN Benefit Plan is a VTN ERISA Plan.
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(b) Except as described in Section 5.15(b) of the VTE Disclosure
Memorandum, all VTN Benefit Plans are in compliance with the applicable
terms of ERISA, the Internal Revenue Code, and any other applicable Laws
the breach or violation of which are reasonably likely to have,
individually or in the aggregate, a VTN Material Adverse Effect. Each VTN
ERISA Plan which is intended to be qualified under Section 401(a) of the
Internal Revenue Code has received a favorable determination letter from
the Internal Revenue Service, and VTN is not aware of any circumstances
likely to result in revocation of any such favorable determination letter.
No VTN Entity has engaged in a transaction with respect to any VTN Benefit
Plan that, assuming the taxable period of such transaction expired as of
the date hereof, would subject any VTN Entity to a Tax imposed by either
Section 4975 of the Internal Revenue Code or Section 502(i) of ERISA.
(c) Within the six-year period preceding the Effective Time, no
Liability under Subtitle C or D of Title IV of ERISA has been or is
expected to be incurred by any VTN Entity with respect to any ongoing,
frozen, or terminated single-employer plan or the single-employer plan of
any ERISA Affiliate, which Liability is reasonably likely to have a VTN
Material Adverse Effect. No VTN Entity has incurred any withdrawal
Liability with respect to a multiemployer plan under Subtitle B of Title IV
of ERISA (regardless of whether based on contributions of an ERISA
Affiliate), which Liability is reasonably likely to have a VTN Material
Adverse Effect. No notice of a "reportable event," within the meaning of
Section 4043 of ERISA for which the 30-day reporting requirement has not
been waived, has been required to be filed for any VTN Pension Plan or by
any ERISA Affiliate within the 12-month period ending on the date hereof.
(d) Except as disclosed in Section 5.15 of the VTN Disclosure
Memorandum, no VTN Entity has any Liability for retiree health and life
benefits under any of the VTN Benefit Plans and there are no restrictions
on the rights of such VTN Entity to amend or terminate any such retiree
health or benefit Plan without incurring any Liability thereunder, which
Liability is reasonably likely to have a VTN Material Adverse Effect.
(e) Except as disclosed in Section 5.15 of the VTN Disclosure
Memorandum, neither the execution and delivery of this Agreement nor the
consummation of the transactions contemplated hereby will (i) result in any
payment (including severance, unemployment compensation, golden parachute,
or otherwise) becoming due to any director or any employee of any VTN
Entity from any VTN Entity under any VTN Benefit Plan or otherwise, (ii)
increase any benefits otherwise payable under any VTN Benefit Plan, or
(iii) result in any acceleration of the time of payment or vesting of any
such benefit, where such payment, increase, or acceleration is reasonably
likely to have, individually or in the aggregate, a VTN Material Adverse
Effect.
(f) The actuarial present values of all accrued deferred compensation
entitlements (including entitlements under any executive compensation,
supplemental retirement, or employment agreement) of employees and former
employees of any VTN Entity and their respective beneficiaries, other than
entitlements accrued pursuant to funded retirement plans subject to the
provisions of Section 412 of the Internal Revenue Code or
-19-
Section 302 of ERISA, have been fully reflected on the VTN Financial
Statements to the extent required by and in accordance with GAAP.
5.16 CERTAIN CONTRACTS. Except as disclosed in Section 5.16 of the VTN
-----------------
Disclosure Memorandum or otherwise reflected in the VTN Financial Statements,
none of the VTN Entities, nor any of their respective Assets, businesses, or
operations, is a party to, or is bound or affected by, or receives benefits
under, (i) any employment, severance, termination, consulting, or retirement
Contract providing for aggregate payments to any Person in any calendar year in
excess of $50,000, (ii) any Contract relating to the borrowing of money by any
VTN Entity or the guarantee by any VTN Entity of any such obligation (other than
Contracts evidencing trade payables), (iii) any Contract which prohibits or
restricts any VTN Entity from engaging in any business activities in any
geographic area, line of business or otherwise in competition with any other
Person, (iv) any Contract between or among VTN Entities, Stockholders, any
director, officer or employee of any VTN Entity and/or Related Persons, (v) any
Contract involving Intellectual Property Rights (other than Contracts entered
into in the ordinary course with customers and "shrink-wrap" software licenses),
(vi) any Contract relating to the provision of data processing, network
communication, or other technical services to or by any VTN Entity, (vii) any
Contract relating to the purchase or sale of any goods or services (other than
Contracts entered into in the ordinary course of business and involving payments
under any individual Contract not in excess of $100,000), (ix) any Contract
providing VTN with the right to purchase or redeem any VTN Common Stock or other
Equity Rights in VTN, (x) any other Contract or amendment thereto that would be
required to be filed as an exhibit to a Form 10-K, if such form were required to
be filed by VTN with the SEC as of the date of this Agreement, (xi) any Contract
relating to indebtedness for borrowed money, (xii) any Contract relating to the
lease of personal property, (xiii) any Contract relating to the lease of real
property, and (xiv) any Contract relating to the development of strategic
alternatives for, raising capital for, or selling VTN (together with all
Contracts referred to in Sections 510, 515(a) and 5.19, the "VTN Contracts").
With respect to each VTN Contract disclosed pursuant to item (xi) of the
preceding sentence, Section 5.16 of the VTN Disclosure Memorandum sets forth,
with respect to each item of indebtedness, (A) the obligee, (B) the obligor, (C)
principal amount outstanding as of the date hereof, (D) the interest rate, (E)
payment schedule, (F) the maturity date, (G) collateral securing such
indebtedness, (H) the name(s) of any third party guarantor(s), (I) a brief
description of any Defaults which have not been cured, (J) the amount of any
prepayment penalty or premium, and (K) any third party Consents to the
transactions contemplated herein which are required pursuant to the terms of
such VTN Contract. With respect to each VTN Contract disclosed pursuant to items
(xii) and (xiii) of this Section 5.16, Section 5.16 of the VTN Disclosure
Memorandum sets forth, with respect to each such lease, (R) the lessor (S) the
lessee, (T) Assets subject to such lease, (V) expiration date of current term,
(V) payment schedule, (W) the terms of any purchase option, (X) a brief
description of any Defaults which have not been cured, (Y) the amount of any
prepayment penalty or premium and (Z) any third party Consents to the
transactions contemplated herein which are required pursuant to the terms of
such VTN Contract. With respect to each Contract to which any VTN Entity is a
party or by which it is bound and except as disclosed in Section 5.16 of the VTN
Disclosure Memorandum: (i) the Contract is in full force and effect; (ii) no VTN
Entity is in Default thereunder, other than Defaults which are not reasonably
likely to have, individually or in the aggregate, a VTN Material Adverse Effect;
(iii) no VTN Entity has
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repudiated or waived any material provision of any such Contract; and (iv) no
other party to any such Contract is, to the Knowledge of VTN, in Default in any
respect or has repudiated or waived any material provision thereunder. All of
the indebtedness of any VTN Entity for money borrowed is prepayable at any time
by such VTN Entity without penalty or premium.
5.17 LEGAL PROCEEDINGS. Except as set forth in Section 5.17 of the
-----------------
VTN Disclosure Memorandum, there is no Litigation instituted or pending, or, to
the Knowledge of VTN, threatened (or unasserted but considered probable of
assertion and which if asserted would have at least a reasonable probability of
an unfavorable outcome) against any VTN Entity, or against any partner,
director, employee or employee benefit plan of any VTN Entity, or against any
Asset, interest, or right of any of them, nor are there any Orders of any
Regulatory Authorities, other governmental authorities, or arbitrators
outstanding against any VTN Entity. Section 5.17 of the VTN Disclosure
Memorandum contains a summary of all Litigation as of the date of this Agreement
to which any VTN Entity is a party and which names a VTN Entity as a defendant
or cross-defendant or for which, to the knowledge of VTN, any VTN Entity has any
potential Liability.
5.18 REPORTS. Since January 1, 1993, or the date of organization if
-------
later, each VTN Entity has timely filed all reports and statements, together
with any amendments required to be made with respect thereto, that it was
required to file with Regulatory Authorities. As of their respective dates, each
of such reports and documents, including the financial statements, exhibits, and
schedules thereto, complied in all material respects with all applicable Laws.
As of its respective date, each such report and document did not, in all
material respects, contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements made therein, in light of the circumstances under which they were
made, not misleading.
5.19 [RESERVED]
----------
5.20 VTN PRODUCTS AND SERVICES. Except as set forth in Section 5.20
-------------------------
of the VTN Disclosure Memorandum the VTN Products and Services conform in all
material respects with any specification, documentation, performance standard,
representation or statement made or provided with respect thereto by or on
behalf of any VTN Entity, and there has not been during the last three (3) years
any claim made against any VTN Entity by any customer of any VTN Entity or, to
the Knowledge of VTN, any customer of a Franchisee, by any Franchisee or by any
other Person alleging that any VTN Product and Service (including each version
thereof that has been licensed or otherwise made available by any VTN Entity to
any Person) does not conform in all material respects with any specification,
documentation, performance standard, representation or statement made or
provided by or on behalf of any VTN Entity, and, to the Knowledge of VTN, there
is not a reasonable basis for any such claim. Notwithstanding the generality of
the foregoing, all VTN Products and Services offered or distributed by any VTN
Entity, the NAP or VTN to each of Amway, its distributors and customers, NAP
customers and the Franchisees or any other VTN customer, conform as of the date
hereof to the current and future performance standards and service levels
applicable thereto, including without limitation, those set forth in the
Contracts listed in Section 5.20 of the VTN Disclosure Memorandum, without
imposition of any
-21-
performance credits or other penalties and otherwise in accordance with the
terms of such Contracts. No product liability or warranty claims which
individually or in the aggregate could exceed the reserves therefor on the VTN
Financial Statements have been communicated in writing to or threatened in
writing against any VTN Entity. The VTN Products and Services, as of the date
hereof, during and after the calendar year 2000 A.D., include design, function
and performance capabilities such that the VTN Products and Services shall not
abnormally end and/or have invalid and/or incorrect results from and/or
performance or functional degradation because of the then-current date. The
design and function of the VTN Products and Services shall ensure year 2000 A.D.
and shall include, but not be limited to, date data century recognition,
calculations that accommodate same century and multicentury formulas and date
values, and date data interface values that reflect the century.
5.21 SYSTEM PERFORMANCE.
------------------
(a) The Network as currently equipped and maintained is Reliably
Handling an average of 70,000 messages per day (with an average length of
120 seconds) which are transmitted from one Hub to another ("Multi-Hub
Messages") in combination with an average of 100,000 messages per day which
are transmitted from a Service Center to a single Hub and back to another
Service Center ("Single-Hub Messages"). The Network as currently equipped
and maintained is Reliably Handling peak loads of 7,200 Multi-Hub Messages
per hour in combination with 10,800 Single-Hub Messages per hour. The
Network is capable, without additional equipment, without an upgrade of
software or hardware, and without material degradation of delivery times or
other Network performance, of Reliably Handling an average of 280,000
Multi-Hub Messages per day in combination with an average of 400,000
Single-Hub Messages per day, as well as peak loads of 28,800 Multi-Hub
Messages per hour in combination with 43,200 Single-Hub Messages per hour.
The Network may be improved, at a total capital expenditure of no more than
$4,500,000 based on current prices offered by suppliers, so that it is
capable of Reliably Handling an average of 650,000 Multi-Hub Messages per
day in combination with an average of 1,000,000 Single-Hub Messages per
day, as well as peak loads of 65,000 Multi-Hub Messages per hour in
combination with 100,000 Single-Hub Messages per hour.
(b) Each Service Center operated by VTN or a Franchisee as
currently equipped and maintained is capable of Reliably Handling an
average of 100 Single-Hub and Multi-Hub Messages (combined) per hour, in
combination with 700 messages per hour which are delivered from a sender to
a recipient within the same Service Center and are not transmitted to a Hub
("Non-Hub Messages"). Twenty percent (20%) of the Service Centers operated
by VTN or its Franchisees as currently equipped and maintained are capable
of Reliably Handling an average of 300 Single-Hub and Multi-Hub Messages
(combined) per hour, in combination with 2,100 Non-Hub Messages per hour.
Each Service Center equipped with one fully loaded Centigram AIP voice mail
server (with all port card slots filled and running version 5.0 VoiceMemo
software), one NIB, and one ACC Nile Router connected to a Hub with a T1
line, is capable of Reliably Handling an average of 400 Single-Hub and
Multi-Hub Messages (combined) per hour, in combination with 2,800 Non-Hub
Messages per hour. Each Service Center operated by VTN or a Franchisee as
currently equipped and maintained operates such that during the busiest
hour of operation, nor more
-22-
than 2 out of every 100 callers will receive a busy condition or signal
referred to as "All Trunks Busy" or ATB. Each Service Center operated by
VTN or a Franchisee as currently equipped and maintained has sufficient
message storage capacity to provide the maximum number and length of
messages allowed and the number of days retained to which every customer
entitled to use the Service Center is currently entitled, and an additional
reserve storage capacity over and above that maximum amount by 10%.
(c) The Network and Hubs as currently equipped and maintained
are capable of meeting the "Network Transmission Standards" and the other
performance requirements set forth in the Agreement among VTNLP, the NAP
and VTE contained in the Grand Solution Documents for all periods through
set forth therein.
5.22 STATEMENTS TRUE AND CORRECT. No statement, certificate,
---------------------------
instrument, or other writing furnished or to be furnished by any VTN Entity or
any Affiliate thereof to Premiere pursuant to this Agreement or any other
document, agreement, or instrument delivered pursuant hereto herein contains or
will contain any untrue statement of material fact or will omit to state a
material fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading. All documents that any
VTN Entity or any Affiliate thereof is responsible for filing with any
Regulatory Authority in connection with the transactions contemplated hereby
will comply as to form in all material respects with the provisions of
applicable Law.
5.23 ACCOUNTING AND REGULATORY MATTERS. No VTN Entity or any
---------------------------------
Stockholder or any Affiliate thereof has taken or agreed to take any action or
has any Knowledge of any fact or circumstance that is reasonably likely to (i)
prevent the Merger from qualifying for pooling-of-interests accounting
treatment, or (ii) materially impede or delay receipt of any Consents of
Regulatory Authorities referred to in Section 9.1(b) or result in the imposition
of a condition or restriction of the type referred to in the last sentence of
such Section.
5.24 STATE TAKEOVER LAWS. Each VTN Entity and each Stockholder has
-------------------
taken all necessary action to exempt the transactions contemplated by this
Agreement from, or if necessary to challenge the validity or applicability of,
any applicable "moratorium," "fair price," "business combination," "control
share," or other anti-takeover Laws (collectively, "Takeover Laws").
5.25 CHARTER PROVISIONS. VTN Entity and each Stockholder has taken all
------------------
action so that the entering into of this Agreement and the consummation of the
Merger and the other transactions contemplated by this Agreement do not and will
not result in the grant of any rights to any Person under the Certificate of
Incorporation, Bylaws or other governing instruments of any VTN Entity or
restrict or impair the ability of Premiere or any of its Subsidiaries to vote,
or otherwise to exercise the rights of a stockholder with respect to, shares of
any VTN Entity that may be directly or indirectly acquired or controlled by
them.
5.26 INVESTMENT INTENTION, ETC. Each Stockholder is acquiring the
-------------------------
shares of Premiere Common Stock to be issued pursuant to this Agreement for
investment only, for such
-23-
Stockholder's own account and not as a nominee or agent, and not with the view
to, or for resale in connection with, any distribution thereof or participation
therein. Except as set forth in Section 5.26 of the VTN Disclosure Memorandum,
each Stockholder is an "accredited investor" as such term is defined in Rule
501(a) under the 1933 Act. Each Stockholder has such knowledge and experience in
business and financial matters and with respect to investments in securities to
enable the Stockholder to understand and evaluate the risks of an investment in
the Premiere Common Stock to be acquired by the Stockholder in the Merger and to
form an investment decision with respect thereto and is able to bear the risk of
such investment for an indefinite period and to afford a complete loss thereof.
Each Stockholder has previously completed, executed and delivered to Premiere an
Investor Questionnaire relating to the transactions contemplated by this
Agreement. The responses contained in such Investor Questionnaires are true and
complete as of the date of the Questionnaire and the date of this Agreement.
Each Stockholder understands that the shares of Premiere Common Stock to be
issued pursuant to this Agreement have not been, and will not be, registered
under the 1933 Act in reliance upon the representations set forth herein and in
the Investor Questionnaires.
5.27 BOARD RECOMMENDATION. The Board of Directors of VTN, at a meeting
--------------------
duly called and held, has by unanimous vote of the directors present (who
constituted all of the directors then in office) (i) determined that this
Agreement and the transactions contemplated hereby, including the Merger, taken
together, are fair to and in the best interests of the Stockholders and (ii)
resolved to recommend that the holders of the shares of VTN Common Stock
approve this Agreement.
5.28 AMWAY MATTERS.
-------------
(a) Amway is a corporation duly organized, validly existing, and
in good standing under the Laws of the State of Michigan, and has the
corporate power and authority to carry on its business as now conducted and
to own, lease and operate its Assets.
(b) Amway has the corporate power and authority to execute and
deliver this Agreement and the Amway Closing Documents to which it is a party
and to perform its obligations under this Agreement and such Amway Closing
Documents. This Agreement represents a legal, valid, and binding obligation
of Amway, enforceable against Amway in accordance with its terms (except in
all cases as such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, receivership, conservatorship, moratorium, or
similar Laws affecting the enforcement of creditors' rights generally and
except that the availability of the equitable remedy of specific performance
or injunctive relief is subject to the discretion of the court before which
any proceeding may be brought) and, upon the execution and delivery by Amway
of the Amway Closing Documents to which it is a party, such Amway Closing
Documents will constitute the legal, valid, and binding obligations of Amway,
enforceable against Amway in accordance with their respective terms (except
in all cases as such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, receivership, conservatorship, moratorium, or
similar Laws affecting the enforcement of creditors' rights generally and
except that the
-24-
availability of the equitable remedy of specific performance or injunctive
relief is subject to the discretion of the court before which any
proceeding may be brought).
[Reserved] (d) Amway is the owner of all right, title and interest (legal
and beneficial) in and to that number of shares of VTN Common Stock set
forth next to its name in Section 5.4(a) of the VTN Disclosure Memorandum,
free and clear of all Liens. Amway is the owner of all right, title and
interest (legal and beneficial) in and to the Amway Convertible Note, free
and clear of all Liens. The Amway Convertible Note is convertible into
78.25 Shares of VTN Common Stock and 95.75 shares of VTE Common Stock.
Other than the Amway Convertible Note, Amway does not have any Contract or
any right or privilege (whether pre-emptive or contractual) capable of
becoming a Contract or Equity Right for the purchase, subscription or
issuance of any securities of VTN.
(e) [Reserved]
(f) [Reserved]
(g) Amway is acquiring the shares of Premiere Common Stock to be
issued pursuant to this Agreement for investment only, for its own account
and not as a nominee or agent, and not with the view to, or for resale in
connection with, any distribution thereof or participation therein. Amway
is an "accredited investor" as such term is defined in Rule 501(a) under
the 1933 Act. Amway has such knowledge and experience in business and
financial matters and with respect to investments in securities to enable
Amway to understand and evaluate the risks of an investment in the Premiere
Common Stock to be acquired by Amway in the Merger and to form an
investment decision with respect thereto and is able to bear the risk of
such investment for an indefinite period and to afford a complete loss
thereof.
ARTICLE 6
REPRESENTATIONS AND WARRANTIES OF PREMIERE
------------------------------------------
Premiere hereby represents and warrants to VTN and the Stockholders as
follows:
6.1 ORGANIZATION, STANDING, AND POWER. Premiere is a corporation duly
---------------------------------
organized, validly existing, and in good standing under the Laws of the State of
Georgia, and has the corporate Premiere is duly qualified or licensed to
transact business as a foreign corporation in good standing in the States of the
United States and foreign jurisdictions where the character of its Assets or the
nature or conduct of its business requires it to be so qualified or licensed,
except for such jurisdictions in which the failure to be so qualified or
licensed is not reasonably likely to have, individually or in the aggregate, a
Premiere Material Adverse Effect.
-25-
6.2 AUTHORITY; NO BREACH BY AGREEMENT.
---------------------------------
(a) Premiere has the corporate power and authority necessary to
execute, deliver and perform its obligations under this Agreement and to
consummate the transactions contemplated hereby. The execution, delivery
and performance of this Agreement and the consummation of the transactions
contemplated herein, including the Merger, have been duly and validly
authorized by all necessary corporate action in respect thereof on the part
of Premiere. This Agreement represents a legal, valid, and binding
obligation of Premiere, enforceable against Premiere in accordance with its
terms (except in all cases as such enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, receivership,
conservatorship, moratorium, or similar Laws affecting the enforcement of
creditors' rights generally and except that the availability of the
equitable remedy of specific performance or injunctive relief is subject to
the discretion of the court before which any proceeding may be brought).
(b) Neither the execution and delivery of this Agreement by
Premiere, nor the consummation by Premiere of the transactions contemplated
hereby, nor compliance by Premiere with any of the provisions hereof, will
(i) conflict with or result in a breach of any provision of Premiere's
Articles of Incorporation or Bylaws or any resolution adopted by the board
of directors or shareholders of Premiere or any of its Subsidiaries, or
(ii) constitute or result in a Default under, or require any Consent
pursuant to, or result in the creation of any Lien on any Asset of any
Premiere Entity under, any Contract or Permit of any Premiere Entity, where
such Default or Lien, or any failure to obtain such Consent, is reasonably
likely to have, individually or in the aggregate, a Premiere Material
Adverse Effect, or, (iii) subject to receipt of the requisite Consents
referred to in Section 9.1(b), constitute or result in a Default under, or
require any Consent pursuant to, any Law or Order applicable to any
Premiere Entity or any of their respective material Assets (including any
Premiere Entity or any VTN Entity becoming subject to or liable for the
payment of any Tax or any of the Assets owned by any Premiere Entity or any
VTN Entity being reassessed or revalued by any Taxing authority).
(c) Other than in connection or compliance with the provisions
of the Securities Laws, applicable state corporate and securities Laws, and
rules of the NASD, and other than Consents required from Regulatory
Authorities, and other than notices to or filings with the Internal Revenue
Service or the Pension Benefit Guaranty Corporation with respect to any
employee benefit plans, or under the HSR Act, and other than Consents,
filings, or notifications which, if not obtained or made, are not
reasonably likely to have, individually or in the aggregate, a Premiere
Material Adverse Effect, no notice to, filing with, or Consent of, any
public body or authority is necessary for the consummation by Premiere of
the Merger and the other transactions contemplated in this Agreement.
6.3 CAPITAL STOCK.
-------------
(a) The authorized capital stock of Premiere consists of
(i)150,000,000 shares of Premiere Common Stock, of which 24,089,769 shares
are issued and outstanding as of
-26-
March 17, 1997, and (ii) 5,000,000 shares of Premiere Preferred Stock, of
which no shares are issued and outstanding. All of the issued and
outstanding shares of Premiere Capital Stock are, and all of the shares of
Premiere Common Stock to be issued in exchange for shares of VTN Common
Stock upon consummation of the Merger, when issued in accordance with the
terms of this Agreement, will be, duly and validly issued and outstanding
and fully paid and nonassessable. None of the outstanding shares of
Premiere Capital Stock has been, and none of the shares of Premiere Common
Stock to be issued in exchange for shares of VTN Common Stock upon
consummation of the Merger will be, issued in violation of any preemptive
rights of the current or past stockholders of Premiere.
(b) Except as set forth in Section 6.3(a), or as provided
pursuant to the Premiere 1994 Stock Option Plan or the Premiere 1995 Stock
Plan or as disclosed in Section 6.3 of the Premiere Disclosure Memorandum,
there are no shares of capital stock or other equity securities of Premiere
outstanding and no outstanding Equity Rights relating to the capital stock
of Premiere.
6.4 PREMIERE SUBSIDIARIES. Premiere has disclosed in Section 6.4 of
---------------------
the Premiere Disclosure Memorandum all of the Premiere Subsidiaries as of the
date of this Agreement that are corporations (identifying its jurisdiction of
incorporation, each jurisdiction in which the character of its Assets or the
nature or conduct of its business requires it to be qualified and/or licensed to
transact business, and the number of shares owned and percentage ownership
interest represented by such share ownership) and all of the Premiere
Subsidiaries that are general or limited partnerships or other non-corporate
entities (identifying the Law under which such entity is organized, each
jurisdiction in which the character of its Assets or the nature or conduct of
its business requires it to be qualified and/or licensed to transact business,
and the amount and nature of the ownership interest therein). Except as
disclosed in Section 6.4 of the Premiere Disclosure Memorandum, Premiere or one
of its wholly-owned Subsidiaries owns all of the issued and outstanding shares
of capital stock (or other equity interests) of each Premiere Subsidiary. No
capital stock (or other equity interest) of any Premiere Subsidiary are or may
become required to be issued (other than to another Premiere Entity) by reason
of any Equity Rights, and there are no Contracts by which any Premiere
Subsidiary is bound to issue (other than to another Premiere Entity) additional
shares of its capital stock (or other equity interests) or Equity Rights or by
which any Premiere Entity is or may be bound to transfer any shares of the
capital stock (or other equity interests) of any Premiere Subsidiary (other than
to another Premiere Entity). There are no Contracts relating to the rights of
any Premiere Entity to vote or to dispose of any shares of the capital stock (or
other equity interests) of any Premiere Subsidiary. All of the shares of capital
stock (or other equity interests) of each Significant Subsidiary of Premiere
held by a Premiere Entity are fully paid and nonassessable and are owned by the
Premiere Entity free and clear of any Lien. Each Premiere Subsidiary is a
corporation, and is duly organized, validly existing, and (as to corporations)
in good standing under the Laws of the jurisdiction in which it is incorporated
or organized, and has the corporate power and authority necessary for it to own,
lease and operate its Assets and to carry on its business as now conducted. Each
Premiere Subsidiary is duly qualified or licensed to transact business as a
foreign corporation in good standing in the States of the United States and
foreign jurisdictions where the character of its Assets or the nature or conduct
of its business requires it to be so qualified or licensed, except for such
jurisdictions in
-27-
which the failure to be so qualified or licensed is not reasonably likely to
have, individually or in the aggregate, a Premiere Material Adverse Effect.
6.5 SEC FILINGS; FINANCIAL STATEMENTS.
---------------------------------
(a) Premiere has timely filed and made available to VTN all SEC
Documents required to be filed by Premiere since March 5, 1996 (the
"Premiere SEC Reports"). The Premiere SEC Reports (i) at the time filed,
complied in all material respects with the applicable requirements of the
Securities Laws and other applicable Laws and (ii) did not, at the time
they were filed (or, if amended or superseded by a filing prior to the date
of this Agreement, then on the date of such filing) contain any untrue
statement of a material fact or omit to state a material fact required to
be stated in such Premiere SEC Reports or necessary in order to make the
statements in such Premiere SEC Reports, in light of the circumstances
under which they were made, not misleading. No Premiere Subsidiary is
required to file any SEC Documents.
(b) Each of the Premiere Financial Statements (including, in each
case, any related notes) contained in the Premiere SEC Reports, including
any Premiere SEC Reports filed after the date of this Agreement until the
Effective Time, complied as to form in all material respects with the
applicable published rules and regulations of the SEC with respect thereto,
was prepared in accordance with GAAP applied on a consistent basis
throughout the periods involved (except as may be indicated in the notes to
such financial statements or, in the case of unaudited interim statements,
as permitted by Form 10-Q of the SEC), and fairly presented in all material
respects the consolidated financial position of Premiere and its
Subsidiaries as at the respective dates and the consolidated results of
operations and cash flows for the periods indicated, except that the
unaudited interim financial statements were or are subject to normal and
recurring year-end adjustments which were not or are not expected to be
material in amount or effect.
6.6 ABSENCE OF UNDISCLOSED LIABILITIES. No Premiere Entity has any
----------------------------------
Liabilities that are reasonably likely to have, individually or in the
aggregate, a Premiere Material Adverse Effect, except Liabilities which are
accrued or reserved against in the consolidated balance sheet of Premiere as of
December 31, 1996, included in the Premiere Financial Statements delivered prior
to the date of this Agreement or reflected in the notes thereto and Liability
(including contingent Liabilities) described in the Premiere SEC Report. Except
as disclosed in the Premiere SEC Reports, no Premiere Entity has incurred or
paid any Liability since December 31, 1996, except for such Liabilities incurred
or paid (i) in the ordinary course of business consistent with past business
practice and which are not reasonably likely to have, individually or in the
aggregate, a Premiere Material Adverse Effect or (ii) in connection with the
transactions contemplated by this Agreement.
6.7 ABSENCE OF CERTAIN CHANGES OR EVENTS. Since December 31, 1996,
------------------------------------
except as disclosed in the Premiere Financial Statements delivered prior to the
date of this Agreement, as disclosed in the Premiere SEC Reports, or as
disclosed in Section 6.7 of the Premiere Disclosure Memorandum, (i) there have
been no events, changes or occurrences which have had, or are
-28-
reasonably likely to have, individually or in the aggregate, a Premiere Material
Adverse Effect, and (ii) the Premiere Entities have not taken any action, or
failed to take any action, prior to the date of this Agreement, which action or
failure, if taken after the date of this Agreement, would represent or result in
a material breach or violation of any of the covenants and agreements of
Premiere provided in Article 7.
6.8. COMPLIANCE WITH LAWS. Each Premiere Entity has in effect all
--------------------
Permits necessary for it to own, lease or operate its material Assets and to
carry on its business as now conducted, except for those Permits the absence of
which are not reasonably likely to have, individually or in the aggregate, a
Premiere Material Adverse Effect, and there has occurred no Default under any
such Permit, other than Defaults which are not reasonably likely to have,
individually or in the aggregate, a Premiere Material Adverse Effect. Except as
disclosed in the Premiere SEC Reports or in Section 6.8 of the Premiere
Disclosure Memorandum, none of the Premiere Entities:
(a) is in Default under its Articles of Incorporation or Bylaws
(or other governing instruments); or
(b) is in Default under any Laws, Orders or Permits applicable
to its business or employees conducting its business, except for Defaults
which are not reasonably likely to have, individually or in the aggregate,
a Premiere Material Adverse Effect; or
(c) since January 1, 1993, has received any notification or
communication from any agency or department of federal, state, or local
government or any Regulatory Authority or the staff thereof (i) asserting
that any Premiere Entity is not in compliance with any of the Laws or
Orders which such governmental authority or Regulatory Authority enforces,
where such noncompliance is reasonably likely to have, individually or in
the aggregate, a Premiere Material Adverse Effect, (ii) threatening to
revoke any Permits, the revocation of which is reasonably likely to have,
individually or in the aggregate, a Premiere Material Adverse Effect, or
(iii) requiring any Premiere Entity to enter into or consent to the
issuance of a cease and desist order, formal agreement, directive,
commitment or memorandum of understanding, or to adopt any Board resolution
or similar undertaking, which restricts materially the conduct of its
business.
6.9 LEGAL PROCEEDINGS. Except as disclosed in the Premiere SEC
-----------------
Reports, there is no Litigation instituted or pending, or, to the Knowledge of
Premiere, threatened (or unasserted but considered probable of assertion and
which if asserted would have at least a reasonable probability of an unfavorable
outcome) against any Premiere Entity, or against any director, employee or
employee benefit plan of any Premiere Entity, or against any Asset, interest, or
right of any of them, that is reasonably likely to have, individually or in the
aggregate, a Premiere Material Adverse Effect, nor are there any Orders of any
Regulatory Authorities, other governmental authorities, or arbitrators
outstanding against any Premiere Entity, that are reasonably likely to have,
individually or in the aggregate, a Premiere Material Adverse Effect.
-29-
6.10 STATEMENTS TRUE AND CORRECT. No statement, certificate,
---------------------------
instrument or other writing furnished or to be furnished by any Premiere Entity
or any Affiliate thereof to VTN pursuant to this Agreement or any other
document, agreement or instrument delivered pursuant hereto contains or will
contain any untrue statement of material fact or will omit to state a material
fact necessary to make the statements therein, in light of the circumstances
under which they were made, not misleading. All documents that any Premiere
Entity or any Affiliate thereof is responsible for filing with any Regulatory
Authority in connection with the transactions contemplated hereby will comply as
to form in all material respects with the provisions of applicable Law.
6.11 ACCOUNTING AND REGULATORY MATTERS. No Premiere Entity or any
---------------------------------
Affiliate thereof has taken or agreed to take any action or has any Knowledge of
any fact or circumstance that is reasonably likely to (i) prevent the Merger
from qualifying for pooling-of-interests accounting treatment or as a
reorganization within the meaning of Section 368(a) of the Internal Revenue
Code, or (ii) materially impede or delay receipt of any Consents of Regulatory
Authorities referred to in Section 9.1(b) or result in the imposition of a
condition or restriction of the type referred to in the last sentence of such
Section. In this regard, Premiere shall execute and deliver to VTN's counsel
prior to the Effective Date a certificate substantially in the form of Exhibit 5
hereto.
ARTICLE 7
CONDUCT OF BUSINESS PENDING CONSUMMATION
----------------------------------------
7.1 AFFIRMATIVE COVENANTS OF VTN. From the date of this Agreement
----------------------------
until the earlier of the Effective Time or the termination of this Agreement,
unless the prior written consent of Premiere shall have been obtained, and
except as otherwise expressly contemplated herein, VTN shall and shall cause
each of its Subsidiaries to (a) operate its business only in the usual, regular,
and ordinary course, (b) preserve intact its business organization and Assets
and maintain its rights and franchises, and (c) knowingly take no action which
would (i) adversely affect the ability of any Party to obtain any Consents
required for the transactions contemplated hereby without imposition of a
condition or restriction of the type referred to in the last sentences of
Section 9.1(b) or 9.1(c), or (ii) adversely affect the ability of any Party to
perform its covenants and agreements under this Agreement.
7.2 NEGATIVE COVENANTS OF VTN. From the date of this Agreement until
-------------------------
the earlier of the Effective Time or the termination of this Agreement, unless
the prior written consent of Premiere shall have been obtained, and except as
otherwise expressly contemplated herein, in the VTE Merger Agreement, or in the
MPI Purchase Agreement or as disclosed in Section 7.2 of the VTN Disclosure
Memorandum, VTN covenants and agrees that it will not do or agree or commit to
do, or permit VTNLP to do or agree or commit to do, any of the following:
(a) amend the Certificate of Incorporation, Bylaws or other
governing instruments of any VTN Entity; or
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(b) incur any additional debt obligation or other obligation for
borrowed money (other than indebtedness of a VTN Entity to another VTN
Entity) in excess of an aggregate of $25,000 (for the VTN Entities on a
consolidated basis) except in the ordinary course of the business of VTN
Subsidiaries consistent with past practices, or impose, or suffer the
imposition, on any Asset of any VTN Entity of any Lien or permit any
such Lien to exist (other than in connection with Liens in effect as of
the date hereof that are disclosed in the VTN Disclosure Memorandum); or
(c) repurchase, redeem, or otherwise acquire or exchange (other
than exchanges in the ordinary course under employee benefit plans),
directly or indirectly, any shares, or any securities convertible into
any shares, of the capital stock of any VTN Entity, or declare or pay
any dividend or make any other distribution in respect of VTN's capital
stock or the general or limited partner interests of VTNLP; or
(d) except for this Agreement, or pursuant to the exercise of
stock options outstanding as of the date hereof and pursuant to the
terms thereof in existence on the date hereof, issue, sell, pledge,
encumber, authorize the issuance of, enter into any Contract to issue,
sell, pledge, encumber, or authorize the issuance of, or otherwise
permit to become outstanding, any additional shares of VTN Common Stock
or any other capital stock or units of VTNLP partner interest or any
other equity interest of any VTN Entity, or any stock appreciation
rights, or any option, warrant, or other Equity Right; or
(e) adjust, split, combine or reclassify any capital stock of
any VTN Entity or issue or authorize the issuance of any other
securities in respect of or in substitution for shares of VTN Common
Stock or partner interests of VTNLP, or sell, lease, mortgage or
otherwise dispose of or otherwise encumber (x) any partner interest in
VTNLP or (y) any Asset other than in the ordinary course of business for
reasonable and adequate consideration; or
(f) except for purchases of U.S. Treasury securities or U.S.
Government agency securities, which in either case have maturities of
three years or less, purchase any securities or make any material
investment, either by purchase of stock of securities, contributions to
capital, Asset transfers, or purchase of any Assets, in any Person other
than a wholly owned VTN Subsidiary, or otherwise acquire direct or
indirect control over any Person; or
(g) grant any increase in compensation or benefits to the
employees or officers of any VTN Entity, except in accordance with past
practice or as required by Law; pay any severance or termination pay or
any bonus other than pursuant to written policies or written Contracts
in effect on the date of this Agreement; and enter into or amend any
severance agreements with officers of any VTN Entity; grant any material
increase in fees or other increases in compensation or other benefits to
directors of any VTN Entity except in accordance with past practice; or
voluntarily accelerate the vesting of any stock options or other
stock-based compensation or employee benefits or other Equity Rights; or
-31-
(h) enter into or amend any employment Contract between any VTN
Entity and any Person (unless such amendment is required by Law) that
the VTN Entity does not have the unconditional right to terminate
without Liability (other than Liability for services already rendered),
at any time on or after the Effective Time; or
(i) adopt any new employee benefit plan of any VTN Entity or
terminate or withdraw from, or make any material change in or to, any
existing employee benefit plans of any VTN Entity other than any such
change that is required by Law or that, in the opinion of counsel, is
necessary or advisable to maintain the tax qualified status of any such
plan, or make any distributions from such employee benefit plans, except
as required by Law, the terms of such plans or consistent with past
practice; or
(j) make any significant change in any Tax or accounting methods
or systems of internal accounting controls, except as may be appropriate
to conform to changes in Tax Laws or regulatory accounting requirements
or GAAP; or
(k) commence any Litigation other than in accordance with past
practice, settle any Litigation involving any Liability of any VTN
Entity for material money damages or restrictions upon the operations of
any VTN Entity; or
(l) enter into, modify, amend or terminate any material Contract
(including any loan Contract with an unpaid balance exceeding $10,000 or
waive, release, compromise or assign any material rights or claims.
7.3 COVENANTS OF PREMIERE. From the date of this Agreement until the
---------------------
earlier of the Effective Time or the termination of this Agreement, unless the
prior written consent of VTN shall have been obtained, and except as otherwise
expressly contemplated herein, Premiere covenants and agrees that it shall (a)
continue to conduct its business and the business of its Subsidiaries in a
manner designed, in its reasonable judgment, to enhance the long-term value of
the Premiere Common Stock and the business prospects of the Premiere Entities
and to the extent consistent therewith use all reasonable efforts to preserve
intact the Premiere Entities' core businesses and goodwill with their respective
employees, and (b) take no action which would (i) materially adversely affect
the ability of any Party to obtain any Consents required for the transactions
contemplated hereby without imposition of a condition or restriction of the type
referred to in the last sentences of Section 9.1(b) or 9.1(c), or (ii)
materially adversely affect the ability of any Party to perform its covenants
and agreements under this Agreement; provided, that the foregoing shall not
prevent any Premiere Entity from acquiring any Assets or other businesses or
from discontinuing or disposing of any of its Assets or business if such action
is, in the reasonable judgment of Premiere, desirable in the conduct of the
business of Premiere and its Subsidiaries. Premiere further covenants and agrees
that it will not, without the prior written consent of VTN, which consent shall
not be unreasonably withheld, amend the Articles of Incorporation or Bylaws of
Premiere, in each case, in any manner adverse to the holders of VTN Common Stock
as compared to rights of holders of Premiere Common Stock generally as of the
date of this Agreement.
-32-
7.4 ADVERSE CHANGES IN CONDITION. Each Party agrees to give written
----------------------------
notice promptly to the other Party upon becoming aware of the occurrence or
impending occurrence of any event or circumstance relating to it or any of its
Subsidiaries which (i) is reasonably likely to have, individually or in the
aggregate, a VTN Material Adverse Effect or a Premiere Material Adverse Effect,
as applicable, or (ii) would cause or constitute a material breach of any of its
representations, warranties, or covenants contained herein, and to use its
reasonable efforts to prevent or promptly to remedy the same.
7.5 REPORTS. Each Party and its Subsidiaries shall file all reports
-------
required to be filed by it with Regulatory Authorities between the date of this
Agreement and the Effective Time and shall deliver to the other Party copies of
all such reports promptly after the same are filed. If financial statements are
contained in any such reports filed with the SEC, such financial statements will
fairly present the consolidated financial position of the entity filing such
statements as of the dates indicated and the consolidated results of operations,
changes in stockholders' equity, and cash flows for the periods then ended in
accordance with GAAP (subject in the case of interim financial statements to
normal recurring year-end adjustments that are not material). As of their
respective dates, such reports filed with the SEC will comply in all material
respects with the Securities Laws and will not contain any untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary in order to make the statements therein, in light of the circumstances
under which they were made, not misleading. Any financial statements contained
in any other reports to another Regulatory Authority shall be prepared in
accordance with Laws applicable to such reports.
ARTICLE 8
ADDITIONAL AGREEMENTS
---------------------
8.1 [RESERVED]
----------
8.2 EXCHANGE LISTING. Premiere shall use its best efforts to list,
----------------
prior to the Effective Time, on the Nasdaq National Market the shares of
Premiere Common Stock to be issued to the holders of VTE Common Stock pursuant
to the Merger, and Premiere shall give all notices and make all filings with the
NASD required in connection with the transactions contemplated herein.
8.3 APPLICATIONS; ANTITRUST NOTIFICATION. Premiere shall prepare and
------------------------------------
file, and VTE and the Stockholders shall cooperate in the preparation and, where
appropriate, filing of, applications with all Regulatory Authorities having
jurisdiction over the transactions contemplated by this Agreement seeking the
requisite Consents necessary to consummate the transactions contemplated by this
Agreement. To the extent required by the HSR Act, each of the Parties will
promptly file with the United States Federal Trade Commission and the United
States Department of Justice the notification and report form required for the
transactions contemplated hereby and any supplemental or additional information
which may reasonably be requested in connection therewith pursuant to the HSR
Act and will comply in all material respects with the requirements
-33-
of the HSR Act. The Parties shall deliver to each other copies of all filings,
correspondence and orders to and from all Regulatory Authorities in connection
with the transactions contemplated hereby.
8.4 FILINGS WITH STATE OFFICES. Upon the terms and subject to the
--------------------------
conditions of this Agreement, Premiere, Sub and VTN shall execute and file the
Certificate of Merger with the Secretary of State of the State of Delaware in
connection with the Closing.
8.5 AGREEMENT AS TO EFFORTS TO CONSUMMATE. Subject to the terms and
-------------------------------------
conditions of this Agreement, each Party agrees to use, and to cause its
Subsidiaries to use, its reasonable efforts to take, or cause to be taken, all
actions, and to do, or cause to be done, all things necessary, proper, or
advisable under applicable Laws to consummate and make effective, as soon as
reasonably practicable after the date of this Agreement, the transactions
contemplated by this Agreement, including using its reasonable efforts to lift
or rescind any Order adversely affecting its ability to consummate the
transactions contemplated herein and to cause to be satisfied the conditions
referred to in Article 9; provided, that nothing herein shall preclude either
Party from exercising its rights under this Agreement. Each Party shall use, and
shall cause each of its Subsidiaries to use, its reasonable efforts to obtain
all Consents necessary or desirable for the consummation of the transactions
contemplated by this Agreement.
8.6 INVESTIGATION AND CONFIDENTIALITY.
---------------------------------
(a) Prior to the Effective Time, each Party shall keep the other
Party advised of all material developments relevant to its business and
to consummation of the Merger and shall permit the other Party to make
or cause to be made such investigation of the business and properties of
it and its Subsidiaries and of their respective financial and legal
conditions as the other Party reasonably requests, provided that such
investigation shall be reasonably related to the transactions
contemplated hereby and shall not interfere unnecessarily with normal
operations. No investigation by a Party shall affect the representations
and warranties of the other Party.
(b) In addition to the Parties' respective obligations under the
Confidentiality Agreement, which is hereby reaffirmed and adopted, and
incorporated by reference herein each Party shall, and shall cause its
advisers and agents to, maintain the confidentiality of all confidential
information furnished to it by the other Party concerning its and its
Subsidiaries' businesses, operations, and financial positions and shall
not use such information for any purpose except in furtherance of the
transactions contemplated by this Agreement. If this Agreement is
terminated prior to the Effective Time, each Party shall promptly return
or certify the destruction of all documents and copies thereof, and all
work papers containing confidential information received from the other
Party.
(c) VTN shall use its reasonable efforts to exercise its rights
under confidentiality agreements entered into with Persons which were
considering an Acquisition Proposal with respect to VTN to preserve the
confidentiality of the information relating to the VTN Entities provided
to such Persons and their Affiliates and Representatives.
-34-
8.7 PRESS RELEASES. Prior to the Effective Time, VTN and Premiere
--------------
shall consult with each other as to the form and substance of any press release
or other public disclosure materially related to this Agreement or any other
transaction contemplated hereby; provided, that nothing in this Section 8.7
shall be deemed to prohibit any Party from making any disclosure which its
outside counsel deems necessary or advisable in order to satisfy such Party's
disclosure obligations imposed by Law. If any such press release or other public
disclosure contains a reference to Amway or any Amway marks, then no such press
release shall be issued or other public disclosure made without the prior
written consent of Amway, which consent shall not be unreasonably withheld.
8.8 CERTAIN ACTIONS. Except with respect to this Agreement and the
----------------
transactions contemplated hereby, no VTN Entity nor any Stockholder nor any
Affiliate thereof nor any Representatives thereof retained by any VTN Entity
shall directly or indirectly solicit any Acquisition Proposal by any Person.
Except to the extent the Board of Directors of VTN, after having consulted with
and considered the advice of outside counsel, reasonably determines in good
faith that the failure to take such actions would constitute a breach of
fiduciary duties of the members of such Board of Directors to VTN's stockholder
under applicable law, no VTN Entity, any Stockholder or any Affiliate or
Representative thereof shall furnish any non-public information that it is not
legally obligated to furnish, negotiate with respect to, or enter into any
Contract with respect to, any Acquisition Proposal, but VTN may communicate
information about such an Acquisition Proposal to its stockholders if and to the
extent that it is required to do so in order to comply with its legal
obligations as advised by outside counsel. Each Stockholder and/or VTN shall
promptly advise Premiere following the receipt of any Acquisition Proposal and
the details thereof, and advise Premiere of any developments with respect to
such Acquisition Proposal promptly upon the occurrence thereof. Each Stockholder
and VTN shall (i) immediately cease and cause to be terminated any existing
activities, discussions or negotiations with any Persons conducted heretofore
with respect to any of the foregoing, and (ii) direct and use its reasonable
efforts to cause all of its Affiliates and Representatives not to engage in any
of the foregoing.
8.9 STOCKHOLDER RELEASES. Except as set forth in Section 8.9 of the
--------------------
VTN Disclosure Memorandum and except, as to Amway, for matters arising under the
Amway Reseller Agreement, each Stockholder, effective upon the Closing, hereby
releases, remises, and forever discharges each VTN Entity, VTE, VTNLP and their
respective Representatives, Affiliates, and insurers, and their respective
successors and assigns, and each of them (hereinafter individually and
collectively, the "Releasees") of and from any and all claims, demands, debts,
accounts, covenants, agreements, obligations, costs, expenses, actions or causes
of action of every nature, character or description, now accrued or which may
hereafter accrue, without limitation of law, equity or otherwise, based in whole
or in part on any facts, conduct, activities, transactions, events or
occurrences known or unknown, which have or allegedly have existed, occurred,
happened, arisen or transpired from the beginning of time to the Effective Time
(the "Released Claims"). Each Stockholder represents and warrants that no
Released Claim released herein has been assigned, expressly, impliedly, or by
operation of Law, and that all Released Claims of such Stockholder released
herein are owned by such Stockholder, who has the sole authority to release
-35-
them. Each Stockholder agrees that such holder shall forever refrain and
forebear from commencing, instituting or prosecuting any lawsuit action or
proceeding, judicial, administrative, or otherwise, or otherwise attempting to
collect or enforce any Released Claims which are released and discharged herein.
8.10 ACCOUNTING TREATMENT. Each of the Parties undertakes and agrees
--------------------
to use its reasonable efforts to cause the Merger, and to take no action which
would be reasonably likely to cause the Merger not, to qualify for treatment as
a pooling of interests for accounting purposes.
8.11 STATE TAKEOVER LAWS. Each VTN Entity and each Stockholder shall
-------------------
take all necessary steps to exempt the transactions contemplated by this
Agreement from, or if necessary to challenge the validity or applicability of,
any applicable Takeover Law, including Section 203 of the DGCL.
8.12 CHARTER PROVISIONS. Each VTN Entity shall take all necessary
------------------
action to ensure that the entering into of this Agreement and the consummation
of the Merger and the other transactions contemplated hereby do not and will not
result in the grant of any rights to any Person under the Certificate of
Incorporation, Bylaws or other governing instruments of any VTN Entity or
restrict or impair the ability of Premiere or any of its Subsidiaries to vote,
or otherwise to exercise the rights of a stockholder with respect to, shares of
any VTN Entity that may be directly or indirectly acquired or controlled by
them.
8.13 TAX RETURNS. Premiere agrees that it will not, without the prior
-----------
written consent of the Escrow Committee, which consent will not be unreasonably
withheld or delayed, permit or cause VTN to file an amended "S" corporation
federal of state income Tax Return with respect to any taxable year or period
ending on or before the Closing Date. In addition Premiere agrees it will cause
VTN to deliver a copy of any other amended Tax Return of VTN for which Premiere
intends to seek indemnification with respect to any Tax period ended on or prior
the Closing Date that VTN proposes to file at least five (5) days prior to the
proposed filing thereof.
8.14 NONCOMPETITION, NONSOLICITATION AND NONDISCLOSURE.
-------------------------------------------------
(a) VTN and each Stockholder (other than Amway) acknowledges:
(i) that each Stockholder has substantial special
expertise and experience in the Business Activities and possesses
substantial contacts with suppliers and customers of VTN, and that
such expertise, experience and contacts have been built up over a
number of years, including such Stockholder's period of ownership of
VTN Common Stock;
(ii) that each Stockholder will be well-compensated under
this Agreement for the expertise, knowledge and contacts he or she
has obtained, as well as the goodwill that he or she has built up in
VTN, and that this Section 8.14 is being executed as an integral part
of such Stockholder's sale of all of his or her VTN Common Stock to
Premiere pursuant to the Merger, an express element of which includes
the sale of the goodwill such Stockholder's ownership and service has
-36-
generated, and for which sale such Stockholder will receive
substantial remuneration hereunder;
(iii) that each Stockholder has occupied a position of
trust and responsibility with VTN in which he or she has had access
to a substantial amount of VTN Confidential Information and VTN Trade
Secrets, and that Premiere is entering into this Agreement in
reliance upon such Stockholder's agreement not to use or disclose
such VTN Trade Secrets and VTN Confidential Information, not to
compete against Premiere or any Affiliate, and not to solicit
Premiere's or any such Affiliates' customers during the time periods
set forth in this Agreement;
(iv) that each Stockholder's special experience and his or
her close identification with goodwill of VTN, the harm caused by
such Stockholder's violation of the provisions of this Section 8.14
cannot reasonably or adequately be compensated solely by damages in
an action at law;
(v) that each Stockholder is capable of competing with
and substantially harming Premiere and its Affiliates and has more
than adequate capital, experience, customer contract, supplier
contact, name recognition and industry reputation to start a
competing business, which would deprive Premiere of all or
substantially all of its bargained for goodwill and other
consideration in the transactions contemplated in this Agreement; and
(vi) that the terms of this Section 8.14 are necessary to
protect Premiere's legitimate business interests and its rights in
the VTN Trade Secrets and VTN Confidential Information and that
Stockholder's competition with Premiere or any of its Affiliates or
other violation of the covenants set forth below would cause
substantial and irreparable harm to Premiere.
(b) For three (3) years immediately following the Effective
Time, if Premiere or any of its Affiliates continues to carry on the
Business Activities of VTN, no Stockholder (other than Amway) shall,
directly or indirectly, by himself or herself or in conjunction with any
person, firm or corporation other than Premiere, engage in Business
Activities, or help anyone else engage in the Business Activities, within
the Restricted Territory. Notwithstanding anything contained herein to the
contrary, a Stockholder may own up to two percent (2%) of the shares of a
publicly-held corporation which competes with Premiere or any of its
Affiliates, provided none of his or her other relationships with such
corporation violate the terms of this Section 8.14 (provided that this
restriction shall not apply to Amway).
(c) For three (3) years immediately following the Effective
Time, no Stockholder (other than Amway) shall, for himself or herself or on
behalf of others, use or disclose any VTN Confidential Information or VTN
Trade Secrets except in the furtherance of the business of Premiere or any
of its Affiliates. No Stockholder (other than Amway) shall use or disclose
any VTN Trade Secrets at any time while the information remains a
-37-
VTN Trade Secret. Nothing in this provision shall limit the protections
available to Premiere under any federal, state or local statute or legal
principle governing confidential information or trade secrets.
(d) If a Stockholder (other than Amway) violates any portion of
this Section 8.14, such Stockholder shall forfeit all compensation due to
such Stockholder under the General Escrow Agreement or the Specific Escrow
Agreement.
(e) Each Stockholder (other than Amway) acknowledges that his or
her agreement not to compete with Premiere or any of its Affiliates is
necessarily of a special, unique and extraordinary nature, and that the
loss arising from a breach thereof cannot reasonably be compensated by
money damages and will cause Premiere and any such Affiliate irreparable
harm. Accordingly, upon the failure of any Stockholder (other than Amway)
to comply with the terms of this Section 8.14 at any time, Premiere and any
such Affiliate shall be entitled to injunctive or other extraordinary
relief in case of such breach, such injunctive or other extraordinary
relief to be cumulative to, but not in limitation of, any other remedies to
which Premiere or any such Affiliate may be entitled.
(f) Premiere and the Stockholders (other than Amway) intend that
Premiere have the broadest possible protection from unfair competition by
the Stockholders (other than Amway) with Premiere or any of its Affiliates,
consistent with public policy. Accordingly, should any court of competent
jurisdiction determine that, consistent with the established precedent of
the forum state, the public policy of such state requires a more limited
restriction in duration, geographical area, nature of restricted activity,
or any combination thereof, it would be in furtherance of the intentions of
the parties hereto for the court to so interpret and construe the terms of
this Agreement, or to modify the Agreement, to apply to only such more
limited restrictions to an appropriate degree.
8.15 AMWAY CONVERTIBLE NOTE. At Closing, Amway shall convert the
----------------------
Amway Convertible Note into 95.75 shares of VTE Common Stock and 78.25 shares of
VTN Common Stock; provided, however, that if the Average Closing Price (without
-------- -------
regard to the Average Closing Price Limitations) is less than $19.85, Amway
shall not be required to convert the Amway Convertible Note, but, in that event,
VTE shall pay in full the Amway Convertible Note at Closing and, in either
event, shall release in full any other rights or remedies that it has by reason
of the Amway Convertible Note.
ARTICLE 9
---------
CONDITIONS PRECEDENT TO OBLIGATIONS TO CONSUMMATE
-------------------------------------------------
9.1 CONDITIONS TO OBLIGATIONS OF EACH PARTY. The respective
---------------------------------------
obligations of each Party to perform this Agreement and consummate the Merger
and the other transactions contemplated hereby are subject to the satisfaction
of the following conditions, unless waived by both Parties pursuant to Section
12.6:
-38-
(a) [RESERVED]
----------
(b) REGULATORY APPROVALS. All waiting periods required by HSR
--------------------
shall have expired.
(c) CONSENTS AND APPROVALS. VTN shall have obtained the
----------------------
Consents required for consummation of the Merger or for the preventing of
any Default under any Contract or Permit of VTN set forth on Section 5.2(b)
of the VTN Disclosure Memorandum. No Consent so obtained which is necessary
to consummate the transactions contemplated hereby shall be conditioned or
restricted in a manner which in the reasonable judgment of the Board of
Directors of Premiere would so materially adversely impact the economic or
business benefits of the transactions contemplated by this Agreement that,
had such condition or requirement been known, such Party would not, in its
reasonable judgment, have entered into this Agreement.
(d) LEGAL PROCEEDINGS. No court or governmental or regulatory
-----------------
authority of competent jurisdiction shall have enacted, issued,
promulgated, enforced or entered any Law or Order (whether temporary,
preliminary or permanent) or taken any other action which prohibits,
restricts or makes illegal consummation of the transactions contemplated by
this Agreement.
(e) EXCHANGE LISTING. The shares of Premiere Common Stock
----------------
issuable pursuant to the Merger shall have been approved for listing on the
Nasdaq National Market.
(f) POOLING LETTERS. Each of the Parties shall have received
---------------
letters, dated as of the Effective Time, addressed to Premiere, in form and
substance reasonably acceptable to Premiere, from Xxxxxx Xxxxxxxx LLP,
acting as auditors for Premiere, to the effect that the Merger will qualify
for pooling-of-interests accounting treatment. Each of the Parties also
shall have received letters, dated as of the Effective Time, addressed to
Premiere, in form and substance reasonably acceptable to Premiere, from
Xxxxxx Xxxxxxxx LLP, acting as auditors for VTN, to the effect that such
firm is not aware of any matters relating to VTN and its Subsidiaries which
would preclude the Merger from qualifying for pooling-of-interests
accounting treatment.
(g) [RESERVED]
(h) REGISTRATION RIGHTS. Premiere and each of the Stockholders,
-------------------
so desiring, shall have executed and delivered the Stock Restriction and
Registration Rights Agreement, in the form attached hereto as Exhibit 4.
(i) [RESERVED]
----------
(j) VTE MERGER. PTEK Merger Corporation and shall have
----------
consummated the VTE Merger.
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(k) MPI PURCHASE. Premiere shall have consummated the purchase
------------
of the Partner Interest from MPI pursuant to the MPI Purchase Agreement.
9.2 CONDITIONS TO OBLIGATIONS OF PREMIERE. The obligations of
-------------------------------------
Premiere to perform this Agreement and consummate the Merger and the other
transactions contemplated hereby are subject to the satisfaction of the
following conditions, unless waived by Premiere pursuant to Section 12.6(a):
(a) REPRESENTATIONS AND WARRANTIES. For purposes of this
------------------------------
Section 9.2(a), the accuracy of the representations and warranties of VTN
and the Stockholders set forth in this Agreement shall be assessed as of
the date of this Agreement and as of the Effective Time with the same
effect as though all such representations and warranties had been made on
and as of the Effective Time (provided that representations and warranties
which are confined to a specified date shall speak only as of such date).
All other representations and warranties of VTN and the Stockholders
contained in this Agreement or any agreement, certificate or instrument
entered into or delivered in connection herewith shall be true and correct
in all material respects.
(b) PERFORMANCE OF AGREEMENTS AND COVENANTS. Each and all of
---------------------------------------
the agreements and covenants of VTN and the Stockholders to be performed
and complied with pursuant to this Agreement and the other agreements
contemplated hereby prior to the Effective Time shall have been duly
performed and complied with in all material respects.
(c) CERTIFICATES. VTN shall have delivered to Premiere (i)
------------
a certificate, dated as of the Effective Time and signed on its behalf by
its chief executive officer and its chief financial officer, to the effect
that the conditions set forth in Section 9.1 as relates to VTN and in
Section 9.2(a), 9.2(b) and 9.2(h) have been satisfied, (ii) certified
copies of resolutions duly adopted by VTN's Board of Directors and
stockholders evidencing the taking of all corporate action necessary to
authorize the execution, delivery and performance of this Agreement, and
the consummation of the transactions contemplated hereby, all in such
reasonable detail as Premiere and its counsel shall request, and (iii) a
certificate or certificate, dated as of the Effective Time and signed on
its behalf by its chief executive officer and its chief financial officer,
in form and substance satisfactory to Premiere and containing such
supporting information as Premiere may request, relating to the calculation
of the adjustments, if any, to the VTN Purchase Price as contemplated in
Section 3.1(d)(ii)(A)-(E).
(d) OPINIONS OF COUNSEL. Premiere shall have received an
-------------------
opinion dated as of the Closing Date from Benesch, Friedlander, Xxxxxx &
Xxxxxxx, counsel to VTN, in form and substance reasonably satisfactory to
Premiere. Premiere shall also have received opinions from counsel to each
of the Stockholders (other than Amway) and an opinion of counsel to Amway,
each dated as of the Closing, in each case containing customary opinions
relating to organization, authority and enforceability.
(e) [RESERVED]
----------
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(f) [RESERVED]
----------
(g) CLAIMS LETTERS. Each of the directors and officers of VTN
--------------
and the other Persons listed in Section 9.2(g) of the VTN Disclosure
Memorandum shall have executed and delivered to Premiere letters in
substantially the form of Exhibit 7.
(h) STOCKHOLDERS' EQUITY. VTN's stockholders' equity as of the
--------------------
Closing shall not be less than VTN's stockholders' equity as of December
31, 1996, excluding for purposes of the calculation of such stockholders'
equity the effects of (i) all costs, fees and charges, including fees and
charges of VTN's accountants, counsel and financial advisors, whether or
not accrued or paid, that are related to the transactions contemplated by
this Agreement and (ii) any reductions in VTN's stockholders' equity
resulting from any actions or changes in policies of VTN taken at the
request of Premiere or actions contemplated by this Agreement to occur on
or before the Closing.
(i) OWNERSHIP AGREEMENTS. VTN shall have used its commercially
--------------------
reasonable best efforts to have each of the persons identified in Section
9.2(i) of the VTN Disclosure Memorandum execute and deliver to VTN and
Premiere agreements, in form and substance reasonably satisfactory to
Premiere, confirming in or transferring to VTN certain Intellectual
Property Rights as described in Section 9.2(i) of the VTN Disclosure
Memorandum.
(j) [RESERVED]
(k) STOCK REPURCHASES. VTN shall have repurchased from the
-----------------
Persons listed on Section 5.16(ix) of the VTN Disclosure Memorandum the
outstanding VTN Common Stock held by such Persons pursuant to rights under
and in accordance with the terms of existing Contracts for repurchase or
redemption of such VTN Common Stock as described in Section 5.16(ix) of the
VTN Disclosure Memorandum.
(l) [RESERVED]
----------
(m) [RESERVED]
----------
(n) GRAND SOLUTION DOCUMENTS. VTN, VTNLP, NAP and the
-------------------------
Franchisees shall have executed and delivered the Grand Solution Documents
in the forms attached as Exhibit 8.
(o) EMPLOYMENT, SEVERANCE AND NONCOMPETITION AGREEMENTS. Each
---------------------------------------------------
of the Persons identified in Section 9.2(o) of the VTN Disclosure
Memorandum shall have executed and delivered to Premiere, and Premiere
shall have executed and delivered to such Persons, an employment or
severance and noncompetition agreement, in form and substance reasonably
satisfactory to the Persons and Premiere (collectively, the "Employment
Agreements").
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9.3 CONDITIONS TO OBLIGATIONS OF VTN AND THE STOCKHOLDERS. The
-----------------------------------------------------
obligations of VTN and the Stockholders to perform this Agreement and consummate
the Merger and the other transactions contemplated hereby are subject to the
satisfaction of the following conditions, unless waived by VTE pursuant to
Section 12.6(b):
(a) REPRESENTATIONS AND WARRANTIES. For purposes of this
------------------------------
Section 9.3(a), the accuracy of the representations and warranties of
Premiere set forth in this Agreement shall be assessed as of the date of
this Agreement and as of the Effective Time with the same effect as though
all such representations and warranties had been made on and as of the
Effective Time (provided that representations and warranties which are
confined to a specified date shall speak only as of such date). The
representations and warranties of Premiere set forth in this Agreement
shall be true and correct in all material respects.
(b) PERFORMANCE OF AGREEMENTS AND COVENANTS. Each and all of
---------------------------------------
the agreements and covenants of Premiere to be performed and complied with
pursuant to this Agreement and the other agreements contemplated hereby
prior to the Effective Time shall have been duly performed and complied
with in all material respects.
(c) CERTIFICATES. Premiere shall have delivered to VTN (i)
------------
a certificate, dated as of the Effective Time and signed on its behalf by
its chief executive officer and its chief financial officer, to the effect
that the conditions set forth in Section 9.1 as relates to Premiere and in
Section 9.3(a) and 9.3(b) have been satisfied, and (ii) certified copies of
resolutions duly adopted by Premiere's Board of Directors and, if required,
Premiere's shareholders evidencing the taking of all corporate action
necessary to authorize the execution, delivery and performance of this
Agreement, and the consummation of the transactions contemplated hereby,
all in such reasonable detail as VTN and its counsel shall request.
(d) OPINION OF COUNSEL. VTN shall have received an opinion
------------------
of Xxxxxx & Bird LLP, counsel to Premiere, dated as of the Effective Time,
containing customary opinions relating to organization, authority and
enforceability.
ARTICLE 10
INDEMNIFICATION
---------------
10.1 AGREEMENT OF INDEMNITORS TO INDEMNIFY. Subject to the terms and
-------------------------------------
conditions of this Article 10, Indemnitors jointly and severally agree to
indemnify, defend, and hold harmless Indemnitees, and each of them, from,
against, for and in respect of any and all Losses asserted against, or paid,
suffered or incurred by, an Indemnitee and resulting from, based upon, or
arising out of:
(a) the inaccuracy, untruth, incompleteness or breach of any
representation or warranty of (i) any Indemnitor or VTN contained in or
made pursuant to this Agreement or
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in any certificate, Schedule, or Exhibit furnished by Indemnitors in
connection herewith or (ii) VTE or any Stockholder of VTE in the VTE Merger
Agreement; provided that for purposes of this Section 10.1(a) any
qualification of such representations and warranties by reference to the
materiality of matters stated therein or as to matters having or not having
a "Material Adverse Effect,", and any limitation of such representations
and warranties as being "to the knowledge of," or "known to" or words of
similar effect, shall be disregarded, in determining any inaccuracy,
untruth, incompleteness or breach thereof;
(b) a breach of or failure to perform any covenant or agreement
of (i) Indemnitors or VTN made in this Agreement or (ii) VTN or the
Stockholders of VTE in the VTE Merger Agreement; and
(c) any claim by a current or former Franchisee (or beneficiary
of an SRA) related to the ownership, control, operation, administration or
other rights to the Network or VTNLP, including without limitation any
claim based on the sale or provision of Network services or right to
control access to the Network to the extent such claim is based on a right
purportedly in existence as of the Effective Time;.
(d) any claim arising out of or related to the matters set forth
in Sections 5.9(a) and 5.15(b) of the VTN Disclosure Memorandum and
Sections 5.9(a) and 5.15(b) of the VTE Disclosure Memorandum;
(e) any claim arising out of or related to the matters set forth
in Section 5.11(c) of the VTN Disclosure Memorandum and Section 5.11(c) of
the VTE Disclosure Memorandum;
(f) any claim by an officer or director or former officer or
director of VTN for indemnification under the by-laws of VTN or any
Subsidiary of VTN or pursuant to any Contract relating to a claim brought
against such officer or director in such capacity relating to any act or
omission or alleged act or omission occurring in whole or in part on or
prior to the Effective Time; and
(g) any claim by any member of the board of directors or
trustees of the NAP or the Franchisee Association pursuant to the
indemnification letter attached as Section 10.1(g) of the VTE Disclosure
Memorandum or Sectin 10.1(g) of the VTE Disclosure Memorandum.
10.2 PROCEDURES FOR INDEMNIFICATION.
------------------------------
(a) An Indemnification Claim shall be made by an Indemnitee by
delivery of a written notice to the Stockholder Representative requesting
indemnification and specifying the basis on which indemnification is sought
and the amount of asserted Losses and, in the case of a Third Party Claim,
containing (by attachment or otherwise) such other information as such
Indemnitee shall have concerning such Third Party Claim.
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(b) If the Indemnification Claim involves a Third Party Claim
the procedures set forth in Section 10.3 shall be observed by the
Indemnitee and the Stockholder Representative.
(c) If the Indemnification Claim involves a matter other than a
Third Party Claim, the Stockholder Representative shall have 30 days to
object to such Indemnification Claim by delivery of a written notice of
such objection to such Indemnitee specifying in reasonable detail the basis
for such objection. Failure to timely so object shall constitute a final
and binding acceptance of the Indemnification Claim by the Stockholder
Representative on behalf of all Indemnitors, and the Indemnification Claim
shall be paid in accordance with subsection (d) hereof. If an objection is
timely interposed by the Stockholder Representative and the dispute is not
resolved by such Indemnitee and the Stockholder Representative within 30
days from the date the Indemnitee receives such objection, such dispute
shall be resolved by arbitration as provided in Section 10.7.
(d) Upon determination of the amount of an Indemnification
Claim, whether by agreement between the Stockholder Representative and the
Indemnitee or by an arbitration award or by any other final adjudication,
the Indemnitors shall pay the amount of such Indemnification Claim within
ten days of the date such amount is determined.
10.3 THIRD PARTY CLAIMS. The obligations and liabilities of the
------------------
parties hereunder with respect to a Third Party Claim shall be subject to
the following terms and conditions:
(a) The Indemnitee shall give the Stockholder Representative
written notice of a Third Party Claim promptly after receipt by the
Indemnitee of notice thereof, and the Stockholder Representative, on behalf
of the Indemnitors, may undertake the defense, compromise and settlement
thereof by representatives of its own choosing reasonably acceptable to the
Indemnitee. The failure of the Indemnitee to notify the Stockholder
Representative of such claim shall not relieve the Indemnitors of any
liability that they may have with respect to such claim except to the
extent the Stockholder Representative demonstrates that the defense of such
claim is prejudiced by such failure. The assumption of the defense,
compromise and settlement of any such Third Party Claim by the Stockholder
Representative shall be an acknowledgment of the obligation of the
Indemnitors to indemnify the Indemnitee with respect to such claim
hereunder. If the Indemnitee desires to participate in, but not control,
any such defense, compromise and settlement, it may do so at its sole cost
and expense. If, however, the Stockholder Representative fails or refuses
to undertake the defense of such Third Party Claim within ten (10) days
after written notice of such claim has been given to the Stockholder
Representative by the Indemnitee, the Indemnitee shall have the right to
undertake the defense, compromise and settlement of such claim with counsel
of its own choosing. In the circumstances described in the preceding
sentence, the Indemnitee shall, promptly upon its assumption of the defense
of such claim, make an Indemnification Claim as specified in Section 10.2
which shall be deemed an Indemnification Claim that is not a Third Party
Claim for the purposes of the procedures set forth herein.
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(b) If, in the reasonable opinion of the Indemnitee, any
Third Party Claim or the litigation or resolution thereof involves an
issue or matter which could have a material adverse effect on the
business, operations, assets, properties or prospects of the Indemnitee
(including, without limitation, the administration of the tax returns
and responsibilities under the tax laws of the Indemnitee), the
Indemnitee shall have the right to control the defense, compromise and
settlement of such Third Party Claim undertaken by the Stockholder
Representative, and the costs and expenses of the Indemnitee in
connection therewith shall be included as part of the indemnification
obligations of the Indemnitors hereunder. If the Indemnitee shall elect
to exercise such right, the Stockholder Representative shall have the
right to participate in, but not control, the defense, compromise and
settlement of such Third Party Claim at its sole cost and expense. Any
compromise or settlement of such Third Party Claim shall be subject to
the approval of the Stockholder Representative, which approval shall not
be unreasonably withheld, conditioned or delayed.
(c) No settlement of a Third Party Claim involving the
asserted liability of the Indemnitors under this Article shall be made
without the prior written consent by or on behalf of the Stockholder
Representative, which consent shall not be unreasonably withheld or
delayed. Consent shall be presumed in the case of settlements of $20,000
or less where the Stockholder Representative has not responded within
five business days of notice of a proposed settlement. If the
Stockholder Representative assumes the defense of such a Third Party
Claim, (a) no compromise or settlement thereof may be effected by the
Stockholder Representative without the Indemnitee's consent unless (i)
there is no finding or admission of any violation of law or any
violation of the rights of any person and no effect on any other claim
that may be made against the Indemnitee, (ii) the sole relief provided
is monetary damages that are paid in full by the Indemnitors, and (iii)
the compromise or settlement includes, as an unconditional term thereof,
the giving by the claimant or the plaintiff to the Indemnitee of a
release, in form and substance satisfactory to the Indemnitee, from all
liability in respect of such Third Party Claim, and (b) the Indemnitee
shall have no liability with respect to any compromise or settlement
thereof effected without its consent.
(d) In connection with the defense, compromise or
settlement of any Third Party Claim, the parties to this Agreement shall
execute such powers of attorney as may reasonably be necessary or
appropriate to permit participation of counsel selected by any party
hereto and, as may reasonably be related to any such claim or action,
shall provide access to the counsel, accountants and other
representatives of each party during normal business hours to all
properties, personnel, books, tax records, contracts, commitments and
all other business records of such other party related to the Third
Party Claim and will furnish to such other party copies of all such
documents as may reasonably be requested (certified, if requested).
10.4 LIMITATIONS AS TO AMOUNT. Indemnitors shall have no
------------------------
liability with respect to the matters described in Section 10.1 until the total
of all Losses with respect thereto exceeds $50,000, in which event Indemnitors
shall be obligated to indemnify the Indemnitees as provided in this Article 10
for all such Losses. The Indemnitors shall not be liable for Losses relating to
a claim for indemnification under (i) Section 10.1(a) or 10.1(b) in excess of
the Escrow, as defined
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in the General Escrow Agreement (the "General Escrow"), on deposit with the
Escrow Agent pursuant to the General Escrow Agreement, and (ii) Sections
10.1(c), 10.1(d), 10.1(e), 10.1(f) or 10.1(g) in excess of the Escrow, as
defined in the Specific Escrow Agreement (the "Specific Escrow"), and the
General Escrow on deposit with the Escrow Agent pursuant to the Specific Escrow
Agreement and the General Escrow Agreement (all such shares of Premiere Common
Stock included in the General Escrow and the Specific Escrow, collectively, the
"Escrow Shares"). Pursuant to the terms and conditions of the Specific Escrow
Agreement and the General Escrow Agreement, any payment of any indemnity to any
Indemnitee in accordance with this Article 10 shall be made solely and
exclusively out of, and shall be limited to, the Escrow Shares and shall be
subject to any additional provisions, including those relating to order or
priority of claims, in the Specific Escrow Agreement and the General Escrow
Agreement.
10.5 TAX EFFECT AND INSURANCE. The liability of the Indemnitors
------------------------
with respect to any Indemnification Claim shall be reduced by the tax benefit
actually or reasonably anticipated to be realized and any insurance proceeds
received by the Indemnitees as a result of any Losses upon which such
Indemnification Claim is based, and shall include any tax detriment actually
suffered by the Indemnitees as a result of such Losses. The amount of any such
tax benefit or detriment shall be determined by taking into account the effect,
if any and to the extent determinable, of timing differences resulting from the
acceleration or deferral of items of gain or loss resulting from such Losses and
shall otherwise be determined so that payment by the Indemnitors of the
Indemnification Claim, as adjusted to give effect to any such tax benefit or
detriment, will make the Indemnitee as economically whole as is reasonably
practical with respect to the Losses upon which the Indemnification Claim is
based. Any dispute as to the amount of such tax benefit or detriment shall be
resolved by arbitration as provided in Section 10.8 of this Agreement.
10.6 SUBROGATION. Upon payment in full of any Indemnification
-----------
Claim, whether such payment is effected by set-off or otherwise, or the payment
of any judgment or settlement with respect to a Third Party Claim, the
Indemnitors shall be subrogated to the extent of such payment to the rights of
the Indemnitee against any person or entity with respect to the subject matter
of such Indemnification Claim or Third Party Claim.
10.7 ARBITRATION. All disputes arising under this Article 10
-----------
(other than claims in equity) shall be resolved by arbitration in accordance
with the Commercial Arbitration Rules of the American Arbitration Association.
Arbitration shall be by a single arbitrator experienced in the matters at issue
and selected by the Stockholder Representative and Premiere in accordance with
the Commercial Arbitration Rules of the American Arbitration Association. The
arbitration shall be held in such place in Atlanta, Georgia as may be specified
by the arbitrator (or any place agreed to by the Stockholder Representative,
Premiere and the arbitrator). The decision of the arbitrator shall be final and
binding as to any matters submitted under this Article 10; provided, however, if
necessary, such decision and satisfaction procedure may be enforced by either
the Stockholder Representative or Premiere in any court of record having
jurisdiction over the subject matter or over any of the parties to this
Agreement. All costs and expenses incurred in connection with any such
arbitration proceeding (including reasonable attorneys fees) shall be borne by
the party against which the decision is rendered, or, if no decision is
rendered, such costs and expenses shall be borne equally by the Indemnitors as
one party and the Indemnitees as the other party. If the arbitrator's decision
is a compromise, the determination of which party or
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parties bears the costs and expenses incurred in connection with any such
arbitration proceeding shall be made by the arbitrator on the basis of the
arbitrator's assessment of the relative merits of the parties' positions.
10.8 EXCLUSIVITY. After the Closing, to the extent permitted by
-----------
Law, the indemnities set forth in this Article 10 shall be the exclusive remedy
of the Indemnitees for any misrepresentation, breach of warranty or
nonfulfillment or failure to be performed of any covenant or agreement contained
in this Agreement, and the parties shall not be entitled to a rescission of this
Agreement or to any further rights or claims of any nature whatsoever in respect
hereof, all of which the Indemnitees hereby waive; provided, however, that
nothing herein limits, and the Indemnitees do not waive, any right or remedy
based on any claim for fraud, which liability based on any claim of fraud, if
any, shall be several and not joint.
ARTICLE 11
TERMINATION
-----------
11.1 TERMINATION. Notwithstanding any other provision of this
-----------
Agreement, and notwithstanding the approval of this Agreement by the
stockholders of VTN or, if required, the Shareholders of Premiere, this
Agreement may be terminated and the Merger abandoned at any time prior to the
Effective Time:
(a) By mutual consent of Premiere and VTN; or
(b) By either Party (provided that the terminating Party is
not then in material breach of any representation, warranty, covenant,
or other agreement contained in this Agreement) in the event of a
material breach by the other Party of any representation or warranty
contained in this Agreement which cannot be or has not been cured within
30 days after the giving of written notice to the breaching Party of
such breach; or
(c) By either Party (provided that the terminating Party is
not then in material breach of any representation, warranty, covenant,
or other agreement contained in this Agreement) in the event of a
material breach by the other Party of any covenant or agreement
contained in this Agreement which cannot be or has not been cured within
30 days after the giving of written notice to the breaching Party of
such breach; or
(d) By either Party (provided that the terminating Party is
not then in material breach of any representation, warranty, covenant,
or other agreement contained in this Agreement relating to Consents of
Regulatory Authorities or approval of Stockholders) in the event any
Consent of any Regulatory Authority required for consummation of the
Merger and the other transactions contemplated hereby shall have been
denied by final nonappealable action of such authority or if any action
taken by such authority is not appealed within the time limit for
appeal; or
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(e) By either Party in the event that the Merger shall not
have been consummated by June 30, 1997, if the failure to consummate the
transactions contemplated hereby on or before such date is not caused by
any breach of this Agreement by the Party electing to terminate pursuant
to this Section 11.1(e); or
(f) By either Party (provided that the terminating Party is
not then in material breach of any representation, warranty, covenant,
or other agreement contained in this Agreement) in the event that any of
the conditions precedent to the obligations of such Party to consummate
the Merger cannot be satisfied or fulfilled, or have not been waived in
writing, by the date specified in Section 11.1(e); or
(g) By either Party if the Average Closing Price is less
than $19.50, unless, in the event the terminating party is VTN,
Premiere, within forty eight (48) hours after receipt of written notice
from VTN of its election to terminate pursuant to this Section 11.1(g)
agrees to adjust the Exchange Ratio to the quotient obtained by dividing
(i) the product of (A) the Exchange Ratio determined pursuant to Section
3.1(c) (including the application of the Average Closing Price
Limitations), multiplied by (B) $19.50, by (ii) the Average Closing
Price (without application of the Average Closing Price Limitations)
(the "Adjusted Exchange Ratio"), in which event the Firm Exchange Ratio
shall be the product of (A) either (1) .77 if the Amway Convertible Note
is converted or (2) .71 if the Amway Convertible Note is not converted
and (B) the Adjusted Exchange Ratio, and the General Escrow Exchange
Ratio shall be the product of .1 and the Adjusted Exchange Ratio and the
Specific Exchange Ratio shall be the product of (C) either (3) .13 if
the Amway Convertible Note is converted or (4) .19 if the Amway
Convertible Note is not converted and (D) the Adjusted Exchange Ratio.
11.2 EFFECT OF TERMINATION. In the event of the termination and
---------------------
abandonment of this Agreement pursuant to Section 11.1, this Agreement shall
become void and have no effect, except that (i) the provisions of this Section
11.2 and Article 12 and Section 8.6(b) shall survive any such termination and
abandonment, and (ii) a termination pursuant to Sections 11.1(b), 11.1(c) or
11.1(f) shall not relieve the breaching Party from Liability for an uncured
willful breach of a representation or warranty or any breach of any covenant or
agreement contained in this Agreement, nor release the other Party for any
liability for any breach of any covenant or agreement contained in this
Agreement.
ARTICLE 12
MISCELLANEOUS
-------------
12.1 DEFINITIONS.
-----------
(a) Except as otherwise provided herein, the capitalized
terms set forth below shall have the following meanings:
"1933 ACT" shall mean the Securities Act of 1933, as
amended.
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"1934 ACT" shall mean the Securities Exchange Act of 1934,
as amended.
"ACQUISITION PROPOSAL" with respect to a Party shall mean
any tender offer or exchange offer or any proposal for a merger,
acquisition of all of the stock or assets of, or other business
combination involving the acquisition of such Party or any of its
Subsidiaries or the acquisition of a substantial equity interest in, or
a substantial portion of the assets of, such Party or any of its
Subsidiaries.
"AFFILIATE" of a Person shall mean: (i) any other Person
directly, or indirectly through one or more intermediaries, controlling,
controlled by or under common control with such Person; (ii) any
officer, director, partner, employer, or direct or indirect beneficial
owner of any 10% or greater equity or voting interest of such Person; or
(iii) any other Person for which a Person described in clause (ii) acts
in any such capacity.
"AGREEMENT" shall mean this Agreement and Plan of Merger,
including the Exhibits delivered pursuant hereto and incorporated herein
by reference.
"AMWAY" shall mean Amway Corporation, a Michigan
corporation and a Stockholder of VTN.
"AMWAY CLOSING DOCUMENTS" shall mean the General Escrow
Agreement, Specific Escrow Agreement and the Registration Rights
Agreement.
"AMWAY CONVERTIBLE NOTE" shall mean the Revolving Credit
Note dated December 16, 1994 made by VTE and VTNLP to Amway in the
principal amount of $5,000,000, and the related Credit Agreement dated
December 16, 1994 among VTE, VTNLP, VTN and Amway, as amended and
supplemented thereafter.
"AMWAY RESELLER AGREEMENT" shall mean the Service and
Reseller Agreement dated September 28, 1990, between Amway and VTE, as
amended by First Amendment to Service and Reseller Agreement dated March
19, 1996 and Second Amendment to Service and Reseller Agreement dated
June 25, 1996.
"ASSETS" of a Person shall mean all of the assets,
properties, businesses and rights of such Person of every kind, nature,
character and description, whether real, personal or mixed, tangible or
intangible, accrued or contingent, or otherwise relating to or utilized
in such Person's business, directly or indirectly, in whole or in part,
whether or not carried on the books and records of such Person, and
whether or not owned in the name of such Person or any Affiliate of such
Person and wherever located.
"BUSINESS ACTIVITIES" shall mean the provision of
interactive voice messaging services.
"CERTIFICATE OF MERGER" shall mean the Certificate of
Merger to be executed by VTN and filed with the Secretary of State of
the State of Delaware relating to the Merger as contemplated by Section
1.1.
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"CLOSING DATE" shall mean the date on which the Closing
occurs.
"CODE" shall mean the Internal Revenue Code of 1986, as
amended.
"CONFIDENTIALITY AGREEMENT" shall mean that certain
Confidentiality Agreement, dated January ,1997, between VTE and
Premiere.
"CONSENT" shall mean any consent, approval, authorization,
clearance, exemption, waiver, or similar affirmation by any Person
pursuant to any Contract, Law, Order, or Permit.
"CONSOLIDATED INDEBTEDNESS OF VTN" shall mean the aggregate
outstanding balance of principal and accrued and unpaid interest under
funded debt and capital lease obligations of VTN and its Subsidiaries
stated on a consolidated basis in accordance with GAAP.
"CONTRACT" shall mean any written or oral agreement,
arrangement, authorization, commitment, contract, indenture, instrument,
lease, obligation, plan, practice, restriction, understanding, or
undertaking of any kind or character, or other document to which any
Person is a party or that is binding on any Person or its capital stock,
Assets or business.
"DEFAULT" shall mean (i) any breach or violation of,
default under any Contract, Law, Order, or Permit, (ii) any occurrence
of any event that with the passage of time or the giving of notice or
both would constitute a breach or violation of, or default under any
Contract, Law, Order, or Permit, or (iii) any occurrence of any event
that with or without the passage of time or the giving of notice would
give rise to a right of any Person to exercise any remedy or obtain any
relief under, terminate or revoke, suspend, cancel, or modify or change
the current terms of, or renegotiate, or to accelerate the maturity or
performance of, or to increase or impose any Liability under, any
Contract, Law, Order, or Permit.
"ENVIRONMENTAL LAWS" shall mean all Laws relating to
pollution or protection of human health or the environment (including
ambient air, surface water, ground water, land surface, or subsurface
strata) and which are administered, interpreted, or enforced by the
United States Environmental Protection Agency and state and local
agencies with jurisdiction over, and including common law in respect of,
pollution or protection of the environment, including the Comprehensive
Environmental Response Compensation and Liability Act, as amended, 42
U.S.C. 9601 et seq. ("CERCLA"), the Resource Conservation and Recovery
Act, as amended, 42 U.S.C. 6901 et seq. ("RCRA"), and other Laws
relating to emissions, discharges, releases, or threatened releases of
any Hazardous Material, or otherwise relating to the manufacture,
processing, distribution, use, treatment, storage, disposal, transport,
or handling of any Hazardous Material.
"EQUITY RIGHTS" shall mean all arrangements, calls,
commitments, Contracts, options, rights to subscribe to, scrip,
understandings, warrants, or other binding obligations
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of any character whatsoever relating to, or securities or rights
convertible into or exchangeable for, shares of the capital stock of a
Person or by which a Person is or may be bound to issue additional
shares of its capital stock or other Equity Rights.
"ERISA" shall mean the Employee Retirement Income Security
Act of 1974, as amended.
"EXHIBITS" 1 through 8, inclusive, shall mean the Exhibits
so marked, copies of which are attached to this Agreement. Such Exhibits
are hereby incorporated by reference herein and made a part hereof, and
may be referred to in this Agreement and any other related instrument or
document without being attached hereto.
"FRANCHISE" shall mean the rights granted by VTE relating
to the ownership and/or operation of one or more Service Centers in one
or more Sales Territories within a Protected Territory pursuant to a
Franchise Agreement.
"FRANCHISE AGREEMENT" shall mean a franchise or license
agreement and all amendments, supplements and modifications thereto
entered into by VTE with any Franchisee relating to a Franchise.
"FRANCHISE OFFERING CIRCULAR" shall mean a franchise
offering circular used by VTE to offer and sell Franchises.
"FRANCHISEE" shall mean any holder of a Franchise.
"GAAP" shall mean generally accepted accounting principles,
consistently applied during the periods involved.
"GBCC" shall mean the Georgia Business Corporation Code.
"HAZARDOUS MATERIAL" shall mean (i) any hazardous
substance, hazardous material, hazardous waste, regulated substance, or
toxic substance (as those terms are defined by any applicable
Environmental Laws) and (ii) any chemicals, pollutants, contaminants,
petroleum, petroleum products, or oil (and specifically shall include
asbestos requiring abatement, removal, or encapsulation pursuant to the
requirements of governmental authorities and any polychlorinated
biphenyls).
"HSR ACT" shall mean Section 7A of the Xxxxxxx Act, as
added by Title II of the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of
1976, as amended, and the rules and regulations promulgated thereunder.
"HUB" shall mean a site which houses switching and routing
equipment used for accepting voice message packet data from the Service
Centers via the T1 local loop and transmitting that packet data to other
Hubs or to Service Centers. There are currently twelve Hubs, one located
in each of ten U.S. cities, plus an eleventh Hub in Toronto, Canada and
a twelfth Hub in Sydney, Australia.
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"INDEMNIFICATION CLAIM" shall mean a claim for
indemnification under Article 10.
"INDEMNITEES" shall mean Premiere, VTN and their respective
officers, directors, stockholders, controlling persons, Affiliates and
Representatives.
"INDEMNITORS" shall mean the Stockholders.
"INTELLECTUAL PROPERTY RIGHT" shall mean: (a) any patent,
patent application, trademark (whether registered or unregistered),
trademark application, trade name, fictitious business name, service
xxxx (whether registered or unregistered), service xxxx application,
copyright (whether registered or unregistered), copyright application,
maskwork, maskwork application, trade secret, know-how, customer list,
system, computer software or computer program (including any source or
object codes therefor or documentation relating thereto), invention,
design, blueprint, engineering drawing, proprietary product, technology,
proprietary right or other intellectual property right or intangible
asset; and (b) any right to use or exploit any of the foregoing.
"INVESTOR QUESTIONNAIRES" shall mean the investor
questionnaires relating to various matters under the Securities Laws
completed by Stockholders and delivered to Premiere prior to the date
hereof.
"KNOWLEDGE" as used with respect to a Person (including
references to such Person being aware of a particular matter) shall mean
the personal knowledge after due inquiry of those facts that are known
or should reasonably have been known after due inquiry and, as used with
respect to a Person that is a corporation or other business entity,
after due inquiry by the chairman, president, chief financial officer,
chief accounting officer, chief operating officer, general counsel, any
assistant or deputy general counsel, or any senior, executive or other
vice president of such Person and the knowledge of any such persons
obtained or which would have been obtained from a reasonable
investigation.
"LAW" shall mean any code, law (including common law),
ordinance, regulation, reporting or licensing requirement, rule, or
statute applicable to a Person or its Assets, Liabilities, or business,
including those promulgated, interpreted or enforced by any Regulatory
Authority.
"LIABILITY" shall mean any direct or indirect, primary or
secondary, liability, indebtedness, obligation, penalty, cost or expense
(including costs of investigation, collection and defense), claim,
deficiency, guaranty or endorsement of or by any Person (other than
endorsements of notes, bills, checks, and drafts presented for
collection or deposit in the ordinary course of business) of any type,
whether accrued, absolute or contingent, liquidated or unliquidated,
matured or unmatured, or otherwise.
"LIEN" shall mean any conditional sale agreement, default
of title, easement, encroachment, encumbrance, hypothecation,
infringement, lien, mortgage, pledge, reservation, restriction, security
interest, title retention or other security arrangement, or any ad-
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verse right or interest, charge, or claim of any nature whatsoever of,
on, or with respect to any property or property interest, other than (i)
Liens for current property Taxes not yet due and payable, and (iii)
Liens which do not materially impair the use of or title to the Assets
subject to such Lien.
"LITIGATION" shall mean any action, arbitration, cause of
action, claim, complaint, criminal prosecution, governmental or other
examination or investigation, hearing, administrative or other
proceeding relating to or affecting a Party, its business, its Assets
(including Contracts related to it), or the transactions contemplated by
this Agreement.
"LOSSES" shall mean any and all demands, claims, actions or
causes of action, assessments, losses, diminution in value, damages
(including special and consequential damages), liabilities, costs, and
expenses, including interest, penalties, cost of investigation and
defense, and reasonable attorneys' and other professional fees and
expenses.
"MATERIAL" for purposes of this Agreement shall be
determined in light of the facts and circumstances of the matter in
question; provided that any specific monetary amount stated in this
Agreement shall determine materiality in that instance.
"MPI" shall mean Merchandising Productions, Inc., a
Delaware corporation and wholly-owned subsidiary of Amway and the sole
limited partner of VTNLP.
"MPI PURCHASE AGREEMENT" shall mean the Purchase and Sale
Agreement of even date between Premiere and MPI.
"NAP AGREEMENT" shall mean an agreement executed by a
Franchisee and VTE in which the Franchisee agrees to be bound by the
bylaws of the NAP Board.
"NAP BOARD" shall mean the Board of Directors of the NAP.
"NAP" shall mean the National Accounts Program of VTE, an
Ohio unincorporated association.
"NASD" shall mean the National Association of Securities
Dealers, Inc.
"NASDAQ NATIONAL MARKET" shall mean the National Market
System of the National Association of Securities Dealers Automated
Quotations System.
"NETWORK" shall mean the digital frame relay network owned
by VTNLP and managed by VTE which includes the NIBs, the Hubs, all
equipment associated with the NIBs and Hubs, all connections between the
NIBs and the Hubs, and all connections between the Hubs.
"NIB" shall mean a Network interface box, developed by VTE
and utilized by VTE, VTN, VTNLP and the Franchisees.
"OGCL" shall mean the Ohio General Corporation Law.
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"OPERATING PROPERTY" shall mean any property owned, leased,
or operated by the Party in question or by any of its Subsidiaries or in
which such Party or Subsidiary holds a security interest or other
interest (including an interest in a fiduciary capacity), and, where
required by the context, includes the owner or operator of such
property, but only with respect to such property.
"ORDER" shall mean any administrative decision or award,
decree, injunction, judgment, order, quasi-judicial decision or award,
ruling, or writ of any federal, state, local or foreign or other court,
arbitrator, mediator, tribunal, administrative agency, or Regulatory
Authority.
"PARTICIPATION FACILITY" shall mean any facility or
property in which the Party in question or any of its Subsidiaries
participates in the management and, where required by the context, said
term means the owner or operator of such facility or property, but only
with respect to such facility or property.
"PARTNER INTEREST" shall have the meaning set forth in the
MPI Purchase Agreement.
"PARTY" shall mean either VTN or Premiere, and "Parties"
shall mean both VTE and Premiere.
"PERMIT" shall mean any federal, state, local, and foreign
governmental approval, authorization, certificate, easement, filing,
franchise, license, notice, permit, or right to which any Person is a
party or that is or may be binding upon or inure to the benefit of any
Person or its securities, Assets, or business.
"PERSON" shall mean a natural person or any legal,
commercial or governmental entity, such as, but not limited to, a
corporation, general partnership, joint venture, limited partnership,
limited liability company, trust, business association, group acting in
concert, or any person acting in a representative capacity.
"PREMIERE CAPITAL STOCK" shall mean, collectively, the
Premiere Common Stock, the Premiere Preferred Stock and any other class
or series of capital stock of Premiere.
"PREMIERE COMMON STOCK" shall mean the $0.01 par value
common stock of Premiere.
"PREMIERE DISCLOSURE MEMORANDUM" shall mean the written
information entitled "Premiere Technologies, Inc. Disclosure Memorandum"
delivered prior to the date of this Agreement to VTN describing in
reasonable detail the matters contained therein and, with respect to
each disclosure made therein, specifically referencing each Section of
this Agreement under which such disclosure is being made. Information
disclosed with respect to one Section shall not be deemed to be
disclosed for purposes of any other Section not specifically referenced
with respect thereto.
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"PREMIERE ENTITIES" shall mean, collectively, Premiere and
all Premiere Subsidiaries.
"PREMIERE FINANCIAL STATEMENTS" shall mean (i) the
consolidated balance sheets (including related notes and schedules, if
any) of Premiere as of December 31, 1996 and 1995, and the related
statements of operations, changes in stockholders' equity, and cash
flows (including related notes and schedules, if any) for each of the
three fiscal years ended December 31, 1996, 1995 and 1994, as filed by
Premiere in SEC Documents, and (ii) the consolidated balance sheets of
Premiere (including related notes and schedules, if any) and related
statements of operations, changes in stockholders' equity, and cash
flows (including related notes and schedules, if any) included in SEC
Documents filed with respect to periods ended subsequent to December 31,
1996.
"PREMIERE MATERIAL ADVERSE EFFECT" shall mean an event,
change or occurrence which, individually or together with any other
event, change or occurrence, has a material adverse impact on (i) the
financial position, business, or results of operations of Premiere and
its Subsidiaries, taken as a whole, or (ii) the ability of Premiere to
perform its obligations under this Agreement or to consummate the Merger
or the other transactions contemplated by this Agreement, provided that
"Material Adverse Effect" shall not be deemed to include the impact of
(a) changes in Laws of general applicability or interpretations thereof
by courts or governmental authorities, (b) changes in generally accepted
accounting principles, (c) actions and omissions of Premiere (or any of
its Subsidiaries) taken with the prior informed written Consent of VTN
in contemplation of the transactions contemplated hereby, and (d) the
direct effects of compliance with this Agreement on the operating
performance of Premiere, including expenses incurred by Premiere in
consummating the transactions contemplated by this Agreement.
"PREMIERE PREFERRED STOCK" shall mean the $0.01 par value
preferred stock of Premiere.
"PREMIERE STOCK PLANS" shall mean the existing stock option
and other stock-based compensation plans of Premiere designated as
follows: Premiere Technologies, Inc. 1994 Stock Option Plan and Premiere
Technologies, Inc. Amended and Restated 1995 Stock Plan.
"PREMIERE SUBSIDIARIES" shall mean the Subsidiaries of
Premiere, which shall include the Premiere Subsidiaries described in
Section 6.4 and any corporation or other organization acquired as a
Subsidiary of Premiere in the future and held as a Subsidiary by
Premiere at the Effective Time.
"PROTECTED TERRITORY" shall mean the territory in which a
Franchisee solicits and provides services and products to customers for
digital voice messaging services as such territory is defined in the
applicable Franchise Agreement.
"PROXY STATEMENT" shall mean the proxy statement used by
VTN to solicit the approval of its stockholders of the transactions
contemplated by this Agreement.
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"RELIABLY HANDLING" as used in this section shall mean delivering
-----------------
a complete voice mail message to electronic storage at the Service Center
which hosts the voice messaging service of the intended recipient of the
message so that the intended recipient may listen to the message within an
average of forty-five (45) minutes of the time the message was recorded by
the sender.
"REGULATORY AUTHORITIES" shall mean, collectively, the SEC, the
----------------------
NASD, the Federal Trade Commission, the United States Department of
Justice, and all other federal, state, county, local or other governmental
or regulatory agencies, authorities (including self-regulatory
authorities), instrumentalities, commissions, boards or bodies having
jurisdiction over the Parties and their respective Subsidiaries.
"RELATED PERSON" shall mean, with regard to any Stockholder or
any director, officer or employee of any VTN Entity, his or her spouse,
parent, sibling, child, aunt, uncle, niece, nephew, in-law, grandparent and
grandchild (including by adoption or remarriage) and any trustees or other
fiduciaries for the benefit of such relatives.
"REPRESENTATIVE" shall mean any investment banker, financial
advisor, attorney, accountant, consultant, or other representative engaged
by a Person.
"RESTRICTED TERRITORY" shall mean the geographic area consisting
of the territory within a fifty (50) mile radius of each Service Center
operated by VTE or a Franchisee immediately prior to the execution of this
Agreement. The Parties further agree that the "Restricted Territory"
extends only to the area in which VTE is doing business directly, or has
licensed a Franchisee to do business, at the time of this Agreement and is
only as broad as necessary to protect the interest of Premiere in the
business of VTE.
"SALES TERRITORY" shall mean the geographic areas into which a
Protected Territory is divided under the relevant Franchise Agreement.
"SEC DOCUMENTS" shall mean all forms, proxy statements,
registration statements, reports, schedules, and other documents filed, or
required to be filed, by a Party or any of its Subsidiaries with any
Regulatory Authority pursuant to the Securities Laws.
"SECURITIES LAWS" shall mean the 1933 Act, the 1934 Act, the
Investment Company Act of 1940, as amended, the Investment Advisors Act of
1940, as amended, the Trust Indenture Act of 1939, as amended, and the
rules and regulations of any Regulatory Authority promulgated thereunder.
"SERVICE CENTER" shall mean a site owned or operated by a VTE
Entity or a Franchisee which houses one or more Centigram voice mail
servers used to store messages for retrieval by users within the local
service area of the Service Center, as well as one or more NIBs and routers
used to transmit voice message packet data to a Hub via the T1 local loop.
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"SRA" shall mean a service representative agreement
executed by VTE and a service representative relating to the provision
of services on behalf of VTE with respect to certain Franchises.
"STOCKHOLDERS' REPRESENTATIVE" shall mean the Escrow Committee
established under the General Escrow Agreement and the Specific Escrow
Agreement
"STOCKHOLDERS' CLOSING DOCUMENTS" shall mean the General Escrow
Agreement, the Specific Escrow Agreement, the Employment Agreements, the
Releases, and the Noncompetition Agreements.
"STOCKHOLDERS' MEETING" shall mean the meeting of the
stockholders of VTN to be held pursuant to Section 8.1, including any
adjournment or adjournments thereof.
"SUB COMMON STOCK" shall mean the no par value common stock of
Sub.
"SUBSIDIARIES" shall mean all those corporations, associations,
or other business entities of which the entity in question either (i) owns
or controls 50% or more of the outstanding equity securities either
directly or through an unbroken chain of entities as to each of which 50%
or more of the outstanding equity securities is owned directly or
indirectly by its parent (provided, there shall not be included any such
entity the equity securities of which are owned or controlled in a
fiduciary capacity), (ii) in the case of partnerships, serves as a general
partner, (iii) in the case of a limited liability company, serves as a
managing member, or (iv) otherwise has the ability to elect a majority of
the directors, trustees or managing members thereof.
"SURVIVING CORPORATION" shall mean VTN as the surviving
corporation resulting from the Merger.
"SUNTRUST" shall mean SunTrust Bank of Atlanta,, as Exchange
Agent or as Escrow Agent under the General Escrow Agreement and the
Specific Escrow Agreement, as applicable.
"SYSTEM" as used in this section shall mean the entire voice
messaging system currently operated by VTE, VTN, VTNLP and the Franchisees,
including but not limited to the Network, all of the Service Centers, and
all connections between the Network and the Service Centers.
"TAX RETURN" shall mean any report, return, information return,
or other information required to be supplied to a taxing authority in
connection with Taxes, including any return of an affiliated or combined or
unitary group that includes a Party or its Subsidiaries.
"TAX" or "TAXES" shall mean any federal, state, county, local, or
foreign taxes, however denominated, including income, gross receipts,
excise, employment, sales, use, transfer, license, payroll, franchise,
severance, stamp, occupation, windfall profits, environmental, federal
highway use, commercial rent, customs duties, capital stock, paid-up
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capital, profits, withholding, Social Security, single business and
unemployment, disability, real property, personal property, registration,
ad valorem, value added, alternative or add-on minimum, estimated, or other
tax or governmental fee of any kind whatsoever, imposes or required to be
withheld by the United States or any state, county, local or foreign
government or subdivision or agency thereof, including any interest,
penalties, and additions imposed thereon or with respect thereto.
"THIRD PARTY CLAIM" shall mean any Litigation that is initiated
against an Indemnitee by a Person other than an Indemnitor and which, if
prosecuted, could result in a Loss for which the Indemnitee is entitled to
indemnification under Article 10.
"VTE" shall mean Voice-Tel Enterprises, Inc., a Delaware
corporation.
"VTE MERGER" shall be the merger of PTEK Merger Corporation with
and into VTE pursuant to the VTE Merger Agreement.
"VTE MERGER AGREEMENT" shall mean the Agreement and Plan of
Merger of even date herewith among Premiere, PTEK Merger Corporation and
VNT.
"VTE PURCHASE PRICE" shall have the meaning set forth in the VTE
Merger Agreement.
"VTN COMMON STOCK" shall mean the no par value common stock of
VTN.
"VTN Confidential Information" means information, other than VTN
Trade Secrets, which relates to VTN, VTN's business, or VTN's suppliers or
customers that is not generally known by persons not employed by VTN and
which Stockholder has learned as a consequence of his or her relationship
to VNT. Such information includes, without limitation, to the extent it is
not considered a VTN Trade Secret, financial information, strategic plans
and forecasts, marketing plans and forecasts, franchisee lists, customer
lilts including NAP customers, customer pricing and order data, supplier
lists, or technical information relating to the VTN's products or services.
"VTN Confidential Information" shall not include information which has
become generally available to the public by the act of one who has the
right to disclose such information without violating a legal right of
Premiere or VTN.
"VTN DISCLOSURE MEMORANDUM" shall mean the written information
entitled "VTN, Inc. Disclosure Memorandum" delivered prior to the date of
this Agreement to Premiere describing in reasonable detail the matters
contained therein and, with respect to each disclosure made therein,
specifically referencing each Section of this Agreement under which such
disclosure is being made. Information disclosed with respect to one Section
shall not be deemed to be disclosed for purposes of any other Section not
specifically referenced with respect thereto.
"VTN ENTITIES" shall mean, collectively, VTN and all VTN
Subsidiaries.
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"VTN FINANCIAL STATEMENTS" shall mean (i) the consolidated
balance sheets (including related notes and schedules, if any) of VNT as of
December 31, 1996, and 1995, and the related statements of income, changes
in stockholders' equity, and cash flows (including related notes and
schedules, if any) for each of the three fiscal years ended December 31,
1996, 1995 and 1994, and (ii) the consolidated balance sheets of VNT
(including related notes and schedules, if any) and related statements of
income, changes in stockholders' equity, and cash flows (including related
notes and schedules, if any) with respect to periods ended subsequent to
December 31, 1996.
"VTN INTELLECTUAL PROPERTY RIGHT" shall mean any Intellectual
Property Right used by any VTN Entity in the course of its business.
"VTN MATERIAL ADVERSE EFFECT" shall mean an event, change or
occurrence which, individually or together with another event, change or
occurrence, has a material adverse impact on (i) the financial position,
business, or results of operations of VTN and VTN, taken as a whole, or
(ii) the ability of VTN to perform its obligations under this Agreement or
to consummate the Merger or the other transactions contemplated by this
Agreement, provided that "VTN Material Adverse Effect: shall not be deemed
to include the impact of (a) changes in Laws of general applicability or
interpretations thereof by courts or governmental authorities, (b) changes
in generally accepted accounting principles, (c) actions and omissions of
VTN (or any of its Subsidiaries) taken with the prior and informed written
Consent of Premiere in contemplation of the transactions contemplated
hereby, and (d) the direct effects of compliance with this Agreement on the
operating performance of VTN, including expenses incurred by VTN in
consummating the transactions contemplated by this Agreement.
"VTN PRODUCTS AND SERVICES" shall mean the interactive voice
messaging services and related equipment provided by the VTN Entities to
customers in the course of their business operations.
"VTN STOCK PLAN" shall mean the existing stock option plan of VTN
designated as follows: 1991 Non-Qualified and Incentive Stock Option Plan
of VTN, Inc.
"VTN SUBSIDIARIES" shall mean the Subsidiaries of VTN, which
shall include the VNT Subsidiaries described in Section 5.5 and any
corporation or other organization acquired as a Subsidiary of VNT in the
future and held as a Subsidiary by VNT at the Effective Time.
"VTN TRADE SECRETS" shall mean all secret, proprietary or
confidential information regarding VTN or its business, including any and
all information not generally known to, or ascertainable by, persons not
employed by VNT, the disclosure or knowledge of which would permit those
persons to derive actual or potential economic value therefrom or to cause
economic or financial harm to VTN. "VTN Trade Secrets" shall not including
information that has become generally available to the public by the act of
one who has the right to disclose such information without violating a
legal right of Premiere or VTN.
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"VTNLP" shall mean Voice-Tel Network Limited Partnership, a
Delaware limited partnership.
(b) The terms set forth below shall have the meanings ascribed
thereto in the referenced sections:
Average Closing Price Section 3.1(c)
Closing Section 1.2
Per Share Purchase Price Section 3.1(c)
Takeover Laws Section 5.23
Average Closing Price Limitations Section 3.1(c)
Base Exchange Ratio Section 3.1(c)
Effective Time Section 1.3
Employment Agreements Section 9.1(k)
ERISA Affiliate Section 5.15(b)
Escrow Shares Section 10.4
Exchange Agent Section 4.1
Exchange Ratio Section 3.1(c)
Firm Exchange Ratio Section 3.1(c)
General Escrow Section 10.4
General Escrow Agreement Section 4.3
General Escrow Exchange Ratio Section 3.1(c)
Merger Section 1.1
Noncompetition Agreements Section 9.2(k)
Premiere SEC Reports Section 6.5(a)
Specific Escrow Section 10.4
Specific Escrow Agreement Section 4.3
Specific Escrow Exchange Ratio Section 3.1(c)
Tax Opinion Section 9.1(h)
Voting Agreements Section 5.25
VTN Benefit Plans Section 5.15
VTN Contracts Section 5.16
VTN ERISA Plan Section 5.15
VTN Stock Options Section 3.6
VTN Pension Plan Section 5.15
(c) Any singular term in this Agreement shall be deemed to
include the plural, and any plural term the singular. Whenever the words
"include," "includes" or "including" are used in this Agreement, they shall be
deemed followed by the words "without limitation."
12.2 Expenses.
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(a) Except as otherwise provided in this Section 12.2, each of
the Parties shall bear and pay all direct costs and expenses incurred by it or
on its behalf in connection with the transactions contemplated hereunder,
including filing, registration and application fees, printing
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fees, and fees and expenses of its own financial or other consultants,
investment bankers, accountants, and counsel.
(b) Nothing contained in this Section 12.2 shall constitute or
shall be deemed to constitute liquidated damages for the willful breach by a
Party of the terms of this Agreement or otherwise limit the rights of the
nonbreaching Party.
12.3 BROKERS AND FINDERS. Except for Salomon Brothers Inc. as to VTN
-------------------
and except for Xxxxxxxxx, Xxxxxxxx & Company as to Premiere, each of the Parties
represents and warrants that neither it nor any of its officers, directors,
employees, or Affiliates has employed any broker or finder or incurred any
Liability for any financial advisory fees, investment bankers' fees, brokerage
fees, commissions, or finders' fees in connection with this Agreement or the
transactions contemplated hereby. In the event of a claim by any broker or
finder based upon his or its representing or being retained by or allegedly
representing or being retained by VTN or any Stockholder or by Premiere, each of
VTN and the Stockholders and Premiere, as the case may be, agrees to indemnify
and hold the other Party harmless of and from any Liability in respect of any
such claim.
12.4 ENTIRE AGREEMENT. Except as otherwise expressly provided herein,
----------------
this Agreement (including the documents and instruments referred to herein)
constitutes the entire agreement between the Parties with respect to the
transactions contemplated hereunder and supersedes all prior arrangements or
understandings with respect thereto, written or oral (except, as to Section
8.6(b), for the Confidentiality Agreement). Nothing in this Agreement expressed
or implied, is intended to confer upon any Person, other than the Parties or
their respective successors, any rights, remedies, obligations, or liabilities
under or by reason of this Agreement.
12.5 AMENDMENTS. To the extent permitted by Law, this Agreement may be
----------
amended by a subsequent writing signed by each of the Parties upon the approval
of each of the Parties, whether before or after stockholder approval of this
Agreement has been obtained; provided, that after any such approval by the
holders of VTN Common Stock, there shall be made no amendment that reduces or
modifies in any material respect the consideration to be received by holders of
VTN Common Stock, to the extent that Section ________)of the DGCL requires
further approval by such stockholders, without the further approval of such
stockholders.
12.6 WAIVERS.
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(a) Prior to or at the Effective Time, Premiere, acting through
its Board of Directors, chief executive officer or other authorized officer,
shall have the right to waive any Default in the performance of any term of this
Agreement by VTN or the Stockholders, to waive or extend the time for the
compliance or fulfillment by VTN or the Stockholders of any and all of its
obligations under this Agreement, and to waive any or all of the conditions
precedent to the obligations of Premiere under this Agreement, except any
condition which, if not satisfied, would result in the violation of any Law. No
such waiver shall be effective unless in writing signed by a duly authorized
officer of Premiere.
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(b) Prior to or at the Effective Time, VTN, acting through its
Board of Directors, chief executive officer or other authorized officer, shall
have the right to waive any Default in the performance of any term of this
Agreement by Premiere, to waive or extend the time for the compliance or
fulfillment by Premiere of any and all of its obligations under this Agreement,
and to waive any or all of the conditions precedent to the obligations of VTN
and the Stockholders under this Agreement, except any condition which, if not
satisfied, would result in the violation of any Law. No such waiver shall be
effective unless in writing signed by a duly authorized officer of VTN.
(c) The failure of any Party at any time or times to require
performance of any provision hereof shall in no manner affect the right of such
Party at a later time to enforce the same or any other provision of this
Agreement. No waiver of any condition or of the breach of any term contained in
this Agreement in one or more instances shall be deemed to be or construed as a
further or continuing waiver of such condition or breach or a waiver of any
other condition or of the breach of any other term of this Agreement.
12.7 ASSIGNMENT. Except as expressly contemplated hereby, neither
----------
this Agreement nor any of the rights, interests or obligations hereunder shall
be assigned by any Party hereto (whether by operation of Law or otherwise)
without the prior written consent of the other Party. Subject to the preceding
sentence, this Agreement will be binding upon, inure to the benefit of and be
enforceable by the Parties and their respective successors and assigns.
12.8 NOTICES. All notices or other communications which are required
-------
or permitted hereunder shall be in writing and sufficient if delivered by hand,
by facsimile transmission, by registered or certified mail, postage pre-paid, or
by courier or overnight carrier, to the persons at the addresses set forth below
(or at such other address as may be provided hereunder), and shall be deemed to
have been delivered as of the date so delivered:
VTN or
any Stockholder
(other than Amway): VTN Inc.
Four Commer Park Sq., No 800
00000 Xxxxxxx Xxxxxxxxx
Xxxxxxxxx, Xxxx 00000
Telecopy Number: (216} 360-4410
Attention: Xxxx X. Xxxxxx, Chairman
Copy to Counsel: Benesch, Friedlander, Xxxxxx & Xxxxxxx
0000 XX Xxxxxxx Xxxxxxxx
000 Xxxxxx Xxxxxx
Xxxxxxxxx, Xxxx 00000
Telecopy Number: (000 000-0000
Attention: Xxxxxxx Xxxxx, Esq.
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Amway: Amway Corporation
0000 Xxxxxx Xxxxxx Xxxx
Xxx, Xxxxxxxx 00000-0000
Attention: Xxx Xxxxxxx
Copy to Counsel: Xxxxx, Day, Xxxxxx & Xxxxx
North Point
000 Xxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxx 00000
Attention: Xxxxxx X. Xxxxxxx, Esq.
Premiere: Premiere Technologies, Inc.
The Xxxxx Xxxxxxxx, Xxxxx 000
0000 Xxxxxxxxx Xxxx, XX
Xxxxxxx, Xxxxxxx 00000
Telecopy Number: (000) 000-0000
Attention: Xxxxxx X. Xxxxx, President
Copy to Counsel: Xxxxxx & Bird LLP
One Atlantic Center
0000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx 00000
Telecopy Number: (000) 000-0000
Attention: Xxxxxxx X. Xxxxxx, Esq.
12.9 GOVERNING LAW. This Agreement shall be governed by and
-------------
construed in accordance with the Laws of the State of Georgia, without regard to
any applicable conflicts of Laws.
12.10 COUNTERPARTS. This Agreement may be executed in two or more
------------
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute one and the same instrument.
12.11 CAPTIONS; ARTICLES AND SECTIONS. The captions contained in this
-------------------------------
Agreement are for reference purposes only and are not part of this Agreement.
Unless otherwise indicated, all references to particular Articles or Sections
shall mean and refer to the referenced Articles and Sections of this Agreement.
12.12 INTERPRETATIONS. Neither this Agreement nor any uncertainty or
--------------
ambiguity herein shall be construed or resolved against any party, whether under
any rule of construction or otherwise. No party to this Agreement shall be
considered the draftsman. The parties
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acknowledge and agree that this Agreement has been reviewed, negotiated, and
accepted by all parties and their attorneys and shall be construed and
interpreted according to the ordinary meaning of the words used so as fairly to
accomplish the purposes and intentions of all parties hereto.
12.13 ENFORCEMENT OF AGREEMENT. The Parties hereto agree that
------------------------
irreparable damage would occur in the event that any of the provisions of this
Agreement was not performed in accordance with its specific terms or was
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 hereof in any court of the United
States or any state having jurisdiction, this being in addition to any other
remedy to which they are entitled at law or in equity.
12.14 SEVERABILITY. Any term or provision of this Agreement which is
------------
invalid or unenforceable in any jurisdiction shall, as to that jurisdiction, be
ineffective to the extent of such invalidity or unenforceability without
rendering invalid or unenforceable the remaining terms and provisions of this
Agreement or affecting the validity or enforceability of any of the terms or
provisions of this Agreement in any other jurisdiction. If any provision of this
Agreement is so broad as to be unenforceable, the provision shall be interpreted
to be only so broad as is enforceable.
12.15 SURVIVAL. All representations, warranties and agreements
--------
contained in this Agreement or in any certificate delivered pursuant to this
Agreement shall survive the Closing notwithstanding any investigation conducted
with respect thereto or any knowledge acquired as to the accuracy or inaccuracy
of any such representation or warranty.
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IN WITNESS WHEREOF, each of the Parties has caused this Agreement to be
executed on its behalf by its duly authorized officers as of the day and year
first above written.
PREMIERE TECHNOLOGIES, INC.
By: /s/ Xxxxxxx X. Xxxxx
--------------------------------------
Senior Vice President
PTEK MERGER CORPORATION
By: /s/ Xxxxxxx X. Xxxxx
--------------------------------------
Senior Vice President
VTN, INC.
By: /s/ Xxxx X. Xxxxxx
--------------------------------------
Chairman
By: /s/ Xxxxxx X. Xxxxxxxxxx
--------------------------------------
President
THE STOCKHOLDERS:
/s/ Xxxxxx X. Xxxxxxx
-----------------------------------(SEAL)
Xxxxxx X. Xxxxxxx
/s/ Xxxxxx X. Xxxxxx XX
-----------------------------------(SEAL)
Xxxxxx X. Xxxxxx XX
/s/ Xxxx X. Xxxxxx
-----------------------------------(SEAL)
Xxxx X. Xxxxxx
/s/ Xxxxxxx X. Xxxxx
-----------------------------------(SEAL)
Xxxxxxx X. Xxxxx
/s/ Xxxxxx X. Xxxxxxxxxx
-----------------------------------(SEAL)
Xxxxxx X. Xxxxxxxxxx
/s/ Xxxxxxx X. Xxxxxxxx
-----------------------------------(SEAL)
Xxxxxxx X. Xxxxxxxx
[SIGNATURES CONTINUED ON NEXT PAGE]
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The undersigned, Amway Corporation, shall be deemed a Stockholder under
this Agreement and Plan of Merger if, and only if, the Amway Convertible Note is
converted prior to the Effective Time.
AMWAY CORPORATION,
a Delaware corporation
By: /s/ Xxx Xxxxxxx
----------------------------------------
Title: Vice President - Corporate
Marketing
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