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EXHIBIT 10.3
STOCK PURCHASE AGREEMENT
THIS STOCK PURCHASE AGREEMENT (the "Agreement") is entered into as of the
30th day of January, 1995, by and between DCR COMMUNICATIONS, INC., a Maryland
corporation (the "Corporation" or the "Company"), and TELECONSULT,
INCORPORATED, a Delaware corporation (hereinafter "Purchaser").
RECITALS:
The Corporation desires to issue and sell to the Purchaser and the
Purchaser desires to purchase Six Hundred Sixty (660) shares of the
Corporation's Class A Voting Common Stock, par value $.01 per share, ("Class A
Common Stock") at a purchase price of Two Hundred Twenty-Seven Dollars and
Twenty-Seven Cents ($227.27) per share, upon the following terms and
conditions.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
set forth herein, the parties hereto, intending to be legally bound, hereby
agree as follows:
SECTION 1
PURCHASE AND SALE OF SECURITIES
1.1. Sale and Issuance of Class A Common Stock. Subject to the terms and
conditions of this Agreement, the Purchaser agrees to purchase and the
Corporation agrees to authorize the issuance of and to sell, issue and deliver
to the Purchaser in the aggregate Six Hundred Sixty (660) shares of the
Corporation's Class A Common Stock, for a purchase price of Two Hundred
Twenty-Seven Dollars and Twenty-Seven Cents ($227.27) per share ("Shares") for
an aggregate purchase price of One Hundred Fifty Thousand Dollars
($150,000.00).
1.2. Closing. The sale and purchase of the Shares issued pursuant to
Section 1.1 shall occur at a closing (the "Closing") to be held at 10:00 a.m.
E.S.T. on January __, 1995, at the offices of Levan, Schimel, Xxxxxx &
Xxxxxxxx, P.A., 0000 Xxxxxx Xxxx Xxxxxxx, Xxxxx 000, Xxxxxxxx, Xxxxxxxx
00000, or such date, time and/or location as the parties hereto shall
otherwise agree (hereinafter, the "Closing Date"). The payment for such
Shares shall be delivered to the Company in immediately available funds.
SECTION 2
CONDITIONS TO CLOSING
2.1. Purchaser's Condition. The obligation of the Purchaser to purchase
the shares pursuant to Section 1.1. hereof at the Closing Date shall be
subject to fulfillment of the following condition on or prior to the Closing,
unless such condition is expressly waived, in writing, by the Purchaser:
2.1.1. Option Agreement. The Purchaser and the Company shall
have entered into that certain Option Agreement in substantially the
same form as set forth in
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the Exhibit 2.1 pursuant to which Three Thousand Six Hundred Forty
(3,640) shares of Class A Common Stock ("Option Shares") may be
acquired by the Purchaser.
2.2. Seller's Condition. The obligation of the Seller to sell the Shares
pursuant to Section 1.1 hereof at the Closing Date shall be subject to
fulfillment of the following condition on or prior to the Closing Date, unless
such condition is expressly waived, in writing, by the Seller:
2.2.1. Subscription Agreement. The Purchaser shall have
completed a Subscription Agreement and Purchaser Questionnaire, if
applicable, as provided by the Corporation with respect to the
Purchaser's Shares purchased hereunder.
SECTION 3
REPRESENTATIONS AND WARRANTIES OF THE CORPORATION
As a material inducement to the Purchaser to purchase shares of Class A
Common Stock hereunder, the Corporation represents and warrants to the
Purchaser that the following statements are true and correct as of the Closing
Date.
3.1. Organization and Standing. The Corporation is a corporation duly
organized, validly existing and in good standing under the laws of the State
of Maryland, has all requisite corporate power and authority to carry on its
business as now conducted and as proposed to be conducted.
3.2. Capitalization. The authorized capital stock of the Corporation
consists of One Hundred Thousand (100,000) shares of Class A Voting Common
Stock and One Hundred Thousand (100,000) shares of Class B Non-Voting Common
Stock.
3.3. Authorization. All corporate action on the part of the Corporation
and its officers, directors and stockholders necessary for the authorization,
execution, delivery and performance of all obligations of the Corporation
under this Agreement has been or will be taken prior to or concurrently with
the Closing. This Agreement, when executed and delivered by the Corporation
(and assuming the due authorization, execution and delivery by the Purchaser
and/or any other parties thereto), shall constitute the legal, valid and
binding obligation of the Corporation, enforceable against the Corporation in
accordance with its terms, except that: (i) enforceability may be limited by
bankruptcy, insolvency or other similar laws affecting creditors' rights
generally, and (ii) the availability of certain remedies may be limited by
equitable principles of general applicability.
3.4. Business Plan. The Corporation has furnished to the Purchaser a
Business Plan of the Corporation ("Business Plan").
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3.5. Title to Assets. The Corporation owns good, marketable title, free
and clear of all liens and encumbrances, to all of the property and assets as
described in the Business Plan, except to the extent that such property and
assets have been disposed of for fair value in the ordinary course of
business.
3.6. Contracts and Commitments. Except as set forth on Schedule 3.6, the
Corporation is not a party to any agreement, contract, commitment or other
obligation, including, but not limited to, any employment agreement, loan
agreement, pension or profit sharing plan, lease or other obligation.
3.7. Brokers and Finders. The Corporation has not incurred or become
liable for any commission, fee or other similar payment to any broker, finder,
agent or other similar payment to any broker, finder, agent or other
intermediary in connection with the negotiation or execution of this Agreement
or the consummation of the transactions contemplated hereby.
SECTION 4
REPRESENTATIONS AND WARRANTIES OF THE PURCHASER
The Purchaser hereby represents and warrants to the Corporation as
follows:
4.1. Organization, Standing, Etc. The Purchaser is duly organized,
validly existing and in good standing under the laws of its jurisdiction of
organization and has all requisite power and authority to execute, deliver and
perform this Agreement. The execution, delivery and performance of this
Agreement by the Purchaser has been duly authorized by all appropriate action
and this Agreement constitutes a valid and binding obligation of the Purchaser
enforceable against it in accordance with the terms hereof.
4.2. Experience. The Purchaser is experienced in evaluating and
investing in companies such as the Corporation. The Purchaser is capable of
evaluating the merits and risks of an investment in the Corporation and has
evaluated the merits and risks associated with its investment in the
Corporation, including the current financial condition of the Corporation.
4.3. Investment. The Purchaser is acquiring the Shares for its own
account for the purpose of investment and not with a view to or for sale in
connection with any distribution thereof. The Purchaser further represents
that it understands that (i) the Shares have not been registered under the
Securities Act of 1933 (the "Act") or the securities laws of any state, (ii)
the Shares cannot be sold unless a subsequent disposition thereof is
registered under the Act and under any applicable state securities law or is
exempt from such registration, (iii) the certificates representing the Shares
will bear a legend to such effect, and (iv)
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the Corporation will make a notation on its transfer books to such effect.
4.4. Access to Information. The Purchaser has had a full opportunity to
request and receive from the Corporation and its responsible officers,
directors and employees, all information which the Purchaser deems relevant to
the purchase of shares of Class A Common Stock hereunder and to inspect the
Corporation's facilities and operations during normal business hours. The
Purchaser acknowledges that it is not relying upon any other purchasers, or
any officer, director, employee, agent, partner or affiliate of any such other
purchaser, in making its investment or decision to invest in the Corporation
or in monitoring such investment.
4.5. Ownership. As of December 1, 1994, the date on which that certain
Stock Purchase Agreement was entered into by and between the Purchaser and the
Corporation, and as of the date first set forth above, the equity of the
Purchaser is owned as set forth on the attached Schedule 4.5.
4.6. Minority Status. The Purchaser is a corporation that is entirely
controlled by Members of Minority Groups (as that phrase is defined in 47 CFR
Section 24.720(i)) and/or women who are United States citizens.
SECTION 5
OWNERSHIP STATUS
5.1. Control Group. The Purchaser and Xxxxxxx Xxx ("Paz") acknowledge
that as of December 1, 1994, the Purchaser was, and upon the purchase of the
Shares the Purchaser will be, a qualifying member of the "control group" of
the Corporation as defined in 47 CFR Section 24.720(k) and Paz will be a
"Qualifying Minority and/or Woman Investor" as defined in 47 CFR Section
24.720(n). The Purchaser and Paz covenant and agree that at all times during
which the Purchaser owns any Common Stock, the Purchaser and Paz will not,
without the prior written consent of the Corporation, assign or transfer
control or any ownership interest of the Purchaser to any person or entity
unless, following such assignment or transfer, the Purchaser shall continue to
be a qualifying member of the control group, and the transferee of any
interest currently owned by Paz shall continue to be owned by a Qualifying
Minority and/or Woman Investor. The Purchaser hereby grants to the
Corporation a continuing right to inspect the minute book, stock ledger and
stock records of the Purchaser in order to confirm the ownership status of the
Purchaser.
5.2. Right to Repurchase. In the event that the Purchaser fails to
maintain its status as a qualifying member of the control group as set forth
in Section 5.1 above, Paz's interest in the Purchaser fails to be owned by a
Qualifying Minority and/or Woman
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Investor or it otherwise causes the Corporation to fail to meet the definition
of a Small Business owned by Members of Minority Groups and/or Women (as
defined in 47 CFR Section 24.720(d)), the Corporation may, at its option,
repurchase any and all Shares owned by the Purchaser. The right to repurchase
shall be exercisable by the Corporation immediately upon the Corporation
providing written notice to the Purchaser of its election to exercise its
repurchase right. The repurchase price shall be the net tangible book value
(total assets excluding intangible assets, less total liabilities, excluding
contingent liabilities) of the Shares based on a balance sheet prepared by the
regular accountant of the Corporation reflecting the financial position of the
Corporation as of a day that is not more than one hundred and eighty (180)
days from the date on which such notice is provided by the Corporation. The
balance sheet shall be prepared in accordance with the accounting principles
consistently applied by the Corporation in connection with the maintenance of
its books and records. The purchase price shall be payable upon payment terms
as determined by the Corporation and may be paid in installments, with
interest at the prime rate published in The Wall Street Journal, Eastern
Edition, but in no event shall the installments extend beyond a five year
period.
SECTION 6
MISCELLANEOUS
6.1. Waivers by Purchaser. Any failure by a Purchaser to insist upon
strict performance by the Corporation of any of the terms and provisions of
this Agreement shall not be deemed to be a waiver of any of the terms and
conditions thereof and the Purchasers shall have the right thereafter to
insist upon strict performance thereof by the Corporation.
6.2. Relationships to Other Agreements. In the event of a conflict
between any of the provisions of this Agreement and any other agreement
relating to this transaction, the provisions of this Agreement shall control.
6.3. Titles and Captions. All section titles or captions in this
Agreement are for convenience only. They shall not be deemed part of this
Agreement and shall in no way define, limit, extend or describe the scope or
intent of provisions herein.
6.4. Applicable Law. This Agreement is to be governed by, and construed,
interpreted, and enforced in accordance with the laws of the State of
Maryland.
6.5. Binding Effect and Assignment. This Agreement shall be binding upon
and inure to the benefit of the heirs, personal representatives, successors
and assigns of the parties. Notwithstanding the foregoing, neither the
Corporation nor the
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Purchaser shall have the right to assign any of their respective rights or
obligations under this Agreement.
6.6. Notices. All notices or other documents required hereunder shall be
deemed to have been given or made when delivered by registered mail or
certified mail, return receipt requested, postage prepaid to:
If the Corporation:
DCR Communications, Inc.
00000 Xxxxxx Xxxx Xxxx
Xxxxxxxx, Xxxxxxxx 00000
Attn: Xxxxxx X. Xxxxx
With copies to:
Levan, Schimel, Xxxxxx & Xxxxxxxx, P.A.
0000 Xxxxxx Xxxx Xxxxxxx, Xxxxx 000
Xxxxxxxx, XX 00000
Attn: Xxxxxx X. Xxxxxxx, Esquire
If to the Purchaser, to the address of the Purchaser as provided to
the Corporation in the Subscription Agreement of the Purchaser. Any party may
from time to time give the others written notice of a change in the address to
which notices are to be sent and any successors in interest.
6.7. Severability. Inapplicability or unenforceability of any provision
of this Agreement shall not impair the operation or validity of any other
provision hereof. If any provision shall be declared inapplicable or
unenforceable, there shall be added automatically as part of this Agreement a
provision as similar in terms to such inapplicable or unenforceable provision
as may be possible and be legal, valid and enforceable.
6.8. Entire Agreement. This Agreement, including all Schedules hereto,
along with all other agreements required to be executed hereunder, constitutes
the entire agreement among the parties pertaining to the subject matter
hereof, and supersedes all prior agreements and understandings pertaining
thereto. No covenant, representation or condition not expressed in this
Agreement shall affect or be deemed to interpret, change or restrict the
express provisions hereof and no amendments hereto shall be valid unless
signed by the Corporation and the Purchaser.
6.9. Counterparts. This Agreement may be executed in any number of
counterparts, all of which together shall constitute one instrument.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
the day and year first above written.
ATTEST/WITNESS: DCR COMMUNICATIONS, INC.
By: /s/ XXXXXX X. XXXXX
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Xxxxxx X. Xxxxx, President
PURCHASER:
TELECONSULT, INCORPORATED
By: /s/ XXXXXXX XXX
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Xxxxxxx Xxx, President
The undersigned, Xxxxxxx Xxx, hereby joins this Agreement for the purpose
of making the representations and warranties of Section 4 and acknowledging
and consenting to the provisions of Sections 4 and 5 regarding ownership
status of Purchaser.
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Xxxxxxx Xxx
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SCHEDULE 3.6
1. Employment Agreement by and between the Corporation and Xxxxxx X.
Xxxxx (proposed draft, not yet executed).
2. Memorandum of Understanding by and between the Corporation and OSCI
dated October 11, 1994.
3. Agreement with a Japanese investment company to find investors for
capital necessary for auction pursuant to which the Company has
agreed to pay commissions in the form of stock and cash.
4. Consulting Agreements with Xxxxxxxxx X. Xxxxx and Xxxxxxx X.
Xxxxxxxx.
5. Letter of Intent between DCR Communications, Inc. and Masa Telecom,
Inc.
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SCHEDULE 4.5
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COMMON PREFERRED - NON-VOTING
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CLASS A - VOTING CLASS B - NON-VOTING CLASS A CLASS B
(NON-CONVERT)
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*Xxxxxxx Xxx 510 60.6% 0 5,000 91.9% 0
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Xxxx Xxxxx (VP) 166 19.7% 0 150 2.8% 0
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Xxxxxx Xxxxxx 166 19.7% 0 140 2.6% 0
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*Terdtoon Tapjan 0 0 100 1.8% 0
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Xxxxxxx Xxxxx 0 0 50 0.9% 0
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*Xxxxxxx Xxxxxxx 0 0 0 4,500 81.9%
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*Xxxxx Xxxx 0 0 0 997 18.1%
----- ----
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Total Issued and 842 100% 0 5,440 100% 5,497 100%
Outstanding
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Total Authorized 30,000 30,000 30,000 30,000
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Strategic Technologies, 720
Inc. (1)
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Xxxxxxx Xxxxxxxxxx (2) 107
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Xxxxxx Xxxxxxxx (3)
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*Each of these stockholders is a United States citizen and is a
woman or a Member of a Minority Group [as defined in 47 CFR Section
24.720 (i)]
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Initials:
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1 U.S. Citizen - Non-minority
2 Minority and U.S. Citizen
3 One more potential investor for 800 shares - U.S./Minority (DCR may
employ).
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