Second Amendment to Stock Purchase Agreement
Exhibit
10.119
Second
Amendment to
This
Second Amendment (“Second
Amendment”) to the Stock Purchase Agreement, dated as of August 22, 2007,
as amended (the “SPA”)
is
entered into as of February 26, 2008 by and among Xxxxx Xxxxxxxx, Xxxxxx Xxxxxx
and Xxxxx Xxxxxxxxx, in their capacity as Sellers’ Representative and for and on
behalf of each of the Sellers party to the SPA, NTS Communications, Inc. (the
“Company”)
and Xfone, Inc. (“Purchaser”). Capitalized
terms used herein have the same meaning as defined in the SPA, unless otherwise
specified herein.
WHEREAS,
pursuant to the SPA the Purchaser has agreed to purchase all of the stock in
the
Company from the Sellers; and
WHEREAS,
the Sellers designated the Sellers’ Representative to act on their behalf in
connection with the SPA;
WHEREAS,
Section 2.2 of the SPA provides that Performance Targets are to be deducted
as
part of the Working Capital and Estimate Working Capital calculations;
and
WHEREAS,
Section 3.1 of the AT&T Network Connection Service Terms and Pricing
Attachment to the Amended and Restated AT&T Master Carrier Agreement between
the Company and AT&T Corp., dated January 15, 2008 (“AT&T Carrier
Agreement”), provides for a Performance Target of up to $380,000 (the
“AT&T
Contingency”) based upon a 100,000,000 minutes of use commitment within
months 1-24 of the Full Service Period, as defined in the AT&T Carrier
Agreement (the “Minutes
of Use
Commitment”).
WHEREAS,
the Parties wish to amend the SPA to provide, among other things, that the
AT&T Contingency will not be a deduction in the Working Capital and
Estimated Working Capital calculations and to provide that the Escrow Amount
will be increased by $380,000 (the “AT&T Escrow
Amount”).
NOW,
THEREFORE, in consideration of the foregoing recitals and other good and
valuable consideration, the parties do hereby agree as follows.
1.
Agreement. The
Parties hereby agree that the AT&T Contingency shall not be a Performance
Target as that term is used in the SPA in connection with the calculation of
Working Capital or Estimate Working Capital and shall not otherwise be a
deduction in the calculation of Working Capital or Estimated Working Capital
pursuant to Section 2.2 of the SPA.
2.
Amendments.
(a)
Section 2.2(b)(ii) of the SPA is amended and restated in its entirety to read
as
follows:
“Subject
to Section 2.2(c), the
Purchaser shall deliver to the Escrow Agent an amount of cash and shares of
Xfone Common Stock (the “Escrow
Amount”) with an aggregate value equal to the sum of (x) fifteen percent
(15%) of the Purchase Price (which in no event for purposes of
determiningthe
Escrow Amount shall result in less than Six Million Three Hundred Thousand
and
No/100 Dollars ($6,300,000.00)) and (y) $380,000 (the “AT&T Escrow Amount”) to
be held under the
Escrow Agreement to secure Sellers’ obligations under Section 2.2(d) and
(e)
and Article
VII.”
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(b)
Section 2.4(a) of the SPA is amended and restated in its entirety to read as
follows:
“
From time to time after the
date of this Agreement and on or prior to the Closing, the Company may, in
its
sole and absolute discretion, distribute cash in an amount not to exceed the
excess of Estimated Working Capital over the Working Capital Target and shall
distribute to its shareholders all of the Company’s membership interest in NTS
Properties, the general partner of NTS Landlord and that certain promissory
note, dated as of October 31, 1998, from NTS Landlord to Company (the “Pre-Closing
Distribution”).”
3.
AT&T Escrow
Amount. Each Seller shall be entitled to receive its Allocable
Share of the AT&T Escrow Amount upon the Company’s satisfaction of the
Minutes of Use Commitment and the Purchaser and the Sellers’ Representative
shall, within five (5) Business Days of such satisfaction, issue joint written
instructions to the Escrow Agent to make a distribution in an aggregate amount
of the AT&T Escrow Amount to the Sellers in accordance with each such
Seller’s Allocable Share. In the event that the Company fails to
satisfy the Minutes of Use Commitment and the Company incurs a Shortfall Charge
as provided in Section 3.1 of the AT&T Network Connection Service Terms and
Pricing of the AT&T Carrier Agreement, then within five (5) Business Days of
the issuance of an invoice from AT&T of a Shortfall Charge that is not then
being disputed by either the Sellers’ Representative or the Company, the
Seller’s Representatives and Purchaser shall issue joint written instructions to
the Escrow Agent to make a distribution in the amount of the Shortfall Charge
to
the Purchaser and the balance of the AT&T Escrow Amount to the Sellers in
accordance with each such Seller’s Allocable Share.
4.
AT&T
Relationship. After the Closing, Purchaser shall not and shall
cause the Company not to engage in any practice, take any action or omit to
take
any action which would reduce the relative importance of AT&T as a business
partner of the Company, negatively impact the Company’s relationship with
AT&T, constitute a default under the AT&T Carrier Agreement or which
would otherwise negatively affect the Company’s ability to satisfy the Minutes
of Use Commitment.
5.
Ratification. The
SPA as amended hereby is ratified and affirmed, and except as expressly amended
hereby, all other terms and provisions of the SPA remain unchanged and continue
in full force and effect.
6.
Execution. This
Second Amendment may be executed in multiple counterparts, each of which will
be
deemed an original, but all of which together shall constitute one and the
same
instrument. The parties hereto agree to accept facsimile signatures
as an original signature.
[SIGNATURE
PAGES FOLLOW]
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Executed
as of the day and year first above written.
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XFONE,
INC.
By: /s/
Xxx
Xxxxxxxxx
Xxx
Xxxxxxxxx, President and CEO
NTS
COMMUNICATIONS, INC.
By: /s/
Xxxxxxx
Xxxxxxx
Xxxxxxx
Xxxxxxx, President and CEO
|
SELLER’S
REPRESENTATIVE FOR AND ON BEHALF OF THE SELLERS:
/s/
Xxxxx
Xxxxxxxx
Xxxxx
Xxxxxxxx
/s/
Xxxxxx
Xxxxxx
Xxxxxx
Xxxxxx
/s/
Xxxxx
Xxxxxxxxx
Xxxxx
Xxxxxxxxx
|
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