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EXHIBIT 10.10
PURCHASE AGREEMENT
AGREEMENT ("Agreement"), made and entered into on the date set forth
below, by and between PRIME EQUITIES GROUP, INC, a Nevada corporation
hereinafter referred to as ("PRIME") and TEL COM PLUS CALIFORNIA, L.L.C., A
FLORIDA L.L.C., hereinafter referred to as ("TEL").
RECITALS
WHEREAS, PRIME desires to acquire and TEL desires to sell up to Eleven
Thousand (11,000) units of TEL COM PLUS CALIFORNIA, L.L.C., (L.L.C.) said
Eleven Thousand (11,000) units of L.L.C. equals 50% of the total ownership of
TEL COM PLUS CALIFORNIA, L.L.C.
NOW, THEREFORE, in consideration of the mutual promises, covenants and
agreements set forth herein, the Parties hereto agree as follows:
ARTICLE 1.
PURCHASE OF UNITS
1.01 PRICE AND TERMS. The aggregate purchase price for the Eleven
Thousand (11,000) units of TEL at One Thousand Four Hundred Ninety Five
($1,495.00) Dollars per unit, as set forth above shall be the sum of Sixteen
Million Four Hundred Forty Five Thousand ($16,445,000.00) Dollars, said
purchase price being evidenced by the surrender of a Non-Recourse Promissory
Note, a copy of which is attached hereto as Exhibit A, executed by PRIME in
favor of TEL in the amount equal to Sixteen Million Four Hundred Forty Five
Thousand ($16,445,000.00) Dollars.
1.02 DELIVERY OF UNITS BY TEL. The transfer and delivery of the
aforementioned units to PRIME by TEL shall be accomplished not later than July
21, 1997. Said units shall be properly endorsed, delivered and/or transferred
to PRIME in a manner that evidences to the general public PRIME's complete
ownership in said units.
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1.03 FURTHER ASSURANCES. At the Closing and from time to time
thereafter, TEL shall execute such additional instruments and take such other
actions as PRIME may reasonably request to more effectively transfer and/or
assign the aforementioned units of TEL to confirm PRIME's title thereto.
1.04 CONTINUING RIGHT OF FIRST REFUSAL. So long as PRIME is not in
default of this Agreement TEL acknowledges and agrees that PRIME shall receive
a continuing first right of refusal on any and all other programs and/or
projects that TEL is involved in the same basis as set forth herein.
ARTICLE 2
SIGNING
2.01 SIGNING DATE. This Agreement shall be executed by the Parties
hereto on or before July 21, 1997 unless extended in writing by the mutual
agreement of the Parties.
ARTICLE 3
REPRESENTATIONS, WARRANTIES AND COVENANTS OF TEL
To the best of its ability, TEL represents and warrants to and
covenants with, PRIME as follows:
3.01 STATUS. TEL is an LLC duly organized, validly existing and in
good standing under the laws of the State of Florida and has taken all steps
necessary to insure that the sale and/or resale of units set forth herein
complies with all State and Federal laws.
3.02 UNDISCLOSED LIABILITIES. TEL had no liabilities of any nature
except to the extent reflected or reserved against TEL's Latest Balance Sheet,
whether accrued, absolute contingent or otherwise, including without
limitation, tax liabilities and interest due or to become due, and TEL's
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accounts receivable are collectible in accordance with the term of such
accounts, except to the extent of the reserve as set forth in TEL's Latest
Balance Sheet.
3.03 INTERIM CHANGES. As of the Signing Date of this Agreement,
there will have not been, except as set forth in a list certified by the TEL
and delivered to PRIME (i) any material changes in TEL'S financial condition,
assets, liabilities or business which, in the aggregate, have been materially
adverse; (ii) any damage, destruction or loss of to TEL'S property, whether or
not covered by insurance other than in the ordinary course of business; (iii)
any declaration or payment of any dividend or other distribution in respect of
TEL'S units, or any direct or indirect redemption, purchase or other
acquisition of any such units; or (iv) any increase paid or agreed to in the
compensation, retirement benefits or other commitments to employees of TEL.
3.04 LITIGATION AND PROCEEDINGS. There is no suit, action, legal or
administrative proceeding pending, or to the knowledge of TEL threatened,
against it which, if adversely determined, might materially and adversely
affect the financial condition of TEL or the conduct of its business nor is
there any decree, injunction or order of any court, governmental department or
agency outstanding against TEL.
3.05 MATERIAL CONTRACTS. TEL warrants that it is not in default in
any material respect under the terms of any material outstanding, contract,
agreement, lease, note or other commitment other than those disclosed in writing
to PRIME.
3.06 NO CONFLICT WITH OTHER INSTRUMENTS. The consummation of the
transactions set forth in this Agreement will not result in the breach of any
term or provision of or constitute a default under any indenture, mortgage,
deed of trust or other material agreement or instrument to which TEL is a party
other than those disclosed in writing to PRIME.
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3.07 GOVERNMENTAL AUTHORIZATIONS. TEL warrants that to the best of
its ability that it has all licenses, permits and other governmental
authorizations which are valid and sufficient for all purposes presently
carried on by TEL.
(a) TEL warrants that it has filed or will file all federal,
state, and other governmental tax returns that are required or has made
adequate provision for the payment of, all taxes which have or may become due,
pursuant to such returns or the assessments received up to and including the
current tax year. No claims or additional assessments have been made or
asserted by the Federal Government or by any State or Federal agencies included
but not limited to income taxes or franchise taxes, except such as have been
paid or are covered by adequate tax reserves, and to the best of TEL'S
knowledge there is no basis for any such claim or additional assessment.
(b) TEL warrants that to the best of its knowledge there are no
judicial or administrative proceedings pending or threatened against it which
involve the possibility of any judgement or liability not fully covered by
insurance or which will materially adversely affect the properties, business,
or condition, financial or otherwise, of and no judgement decree, or order of
any Court, board, or other governmental or administrative agency which has been
or will be issued which has or will have any material adverse effect on the
business or assets or on the condition, financial or otherwise.
(c) Except as duly authorized by its charter, TEL shall not
engage in any material activity or transaction, other than in the ordinary
course of business, without prior written notice to PRIME.
(d) After July 21, 1997, TEL warrants that it has not issued or
sold or issued rights to sell, any of its units, nor shall it declare or pay
any person, company and or entity after, without prior written notice to PRIME.
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(e) TEL warrants to the best of its ability, the assets, property
and rights being passed to PRIME in the aforementioned units on July 21, 1997
shall be preserved and maintained so far as practicable in the ordinary and
customary conduct of its business to the same extent and in the same condition
as such assets, property, and rights as were when under the control of TEL on
the Signing Date, without prior notification to PRIME and provided that any
change in the operations is deemed by the officers of TEL to be reasonable and
in the best interest of the Parties hereto.
(f) TEL shall comply with all reasonable requests by PRIME to
afford to PRIME, or its representatives, access to its property, books, assets,
records, and interests in real estate, if applicable, and will furnish as soon
as practical, any information with respect thereto reasonably requested by
PRIME.
3.09 TITLE TO PROPERTY. TEL warrants that, it has good and
marketable title to all properties and assets, real and personal, reflected in
its transfer of units to PRIME.
3.09 CONFIDENTIALITY. The Parties hereto and their representatives
will keep confidential any information which they obtain from each other
concerning the transaction set forth herein. If the transaction contemplated by
this Agreement is not consummated by July 21, 1997, the Parties will return to
each other all written matter with respect to the transaction set forth herein
held by them in connection with the negotiation and/or consummation of this
Agreement, unless the Parties hereto agree to an extension.
3.10 TITLE TO UNITS. TEL guarantees that the aforementioned units
are free and clear of any liens and encumbrances, except those that have been
disclosed in writing to PRIME.
3.11 DUE AUTHORIZATION. Execution of this Agreement and
performance by TEL hereunder has been duly authorized by all requisite
corporate action on the part of TEL and this Agreement
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constitutes a valid and binding obligation of TEL and performance hereunder
will not violate any provision of TEL'S Articles of Incorporation, Bylaws,
agreements, or any other commitment.
ARTICLE 4.
ACCESS TO PROPERTY AND RECORDS, ETC.
4.01 ACCESS AND INFORMATION. THE PARTIES HERETO acknowledge and
agree that each will give to the other and to the other's accountants, counsel
and other representatives full access during normal business hours throughout
the period prior to the Closing Date to all of its properties, books,
contracts, commitments and/or records.
4.02 EXPENSES. Upon a termination or recision of this Agreement
each party will pay all ancillary costs and expenses related to its performance
of and compliance with all agreements and conditions contained herein on its
part to be performed or complied with, including fees, expenses and
disbursements of its accountants, counsel and/or consultants.
4.03 FURTHER ASSURANCES. If at any time PRIME shall consider or be
advised that any further assignment or assurance in law or other action is
necessary or desirable to vest, perfect, or confirm, of record or otherwise, in
PRIME, the title to any property or rights of TEL acquired or to be acquired by
or as a result of the transaction set forth herein, the proper parties of TEL,
shall be and they hereby are severally and fully authorized to execute and
deliver such proper, deeds, assignments and assurances in law and take such
other action as may be necessary or proper in the name of PRIME or TEL to vest,
perfect or confirm title to such property or rights in PRIME and otherwise carry
out the purpose of this Agreement.
ARTICLE 5
CONDUCT OF TEL PENDING SIGNING
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TEL agrees that to the very best of its ability that it will conduct
itself in the following manner pending the signing:
5.01 LIMITED LIABILITY COMPANY STATUS. No change will be made in
TEL's Limited Liability Status.
5.02 CAPITALIZATION AND NON-DILUTION. TEL shall not make any
change in its originally authorized and issued number of units, and further
guarantees absolutely no dilution of Prime's original ownership position,
without the prior written consent of Prime.
5.03 SHAREHOLDER'S MEETING. If required by its Articles of
Organization for Florida Limited Liability Company TEL will submit this
Agreement to its shareholders with a favorable recommendation by its Board of
Directors and will use its best efforts to obtain the requisite shareholder
approval.
5.04 CONDUCT OF BUSINESS. TEL will use its best efforts to
maintain and preserve its business organization, employee relationships and
good will, intact and will not, without the written notice to PRIME, enter
into any material commitment except in the ordinary course of business to sell
or assign additional units.
ARTICLE 6
TERMINATION
6.01 CIRCUMSTANCES OF TERMINATION. This Agreement may be
terminated by (i) mutual consent of the Parties hereto in writing upon the
failure of any Party hereto to perform as set forth herein; (ii) by any party
to this Agreement if there has been a material breach of any warranty or
covenant by the other party, or (iii) by any party to this Agreement if the
Closing shall not have taken place as set forth herein unless extended in
writing to a later date by mutual consent of the Parties
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hereto.
6.02 EFFECT OF TERMINATION. In the event of a termination of this
Agreement pursuant to the terms of this Agreement, each party shall pay the
costs and expenses incurred by it in connection with this Agreement and no
party or any of its officer, directors or employees shall be liable to any
other party for any costs, expenses, damages, or loss of anticipated profits.
ARTICLE 7
GENERAL PROVISIONS
7.01 FURTHER ASSURANCES. At any time and from time to time after
the Closing date, each party will execute such additional instruments and take
such action as may be reasonably requested by the other party to confirm or
perfect title to any property transferred hereunder or otherwise to carry out
the intent and purposes of this Agreement.
7.02 WAIVER. Any failure on the part of either party hereto to
comply with any of its obligations, agreements or conditions hereunder may be
waived by the party to whom such compliance is owed.
7.03 NOTICES. All notices and other communications hereunder shall
be in writing and shall be deemed to have been given if delivered in person or
sent by prepaid first class registered or certified mad, return receipt
requested, as follows:
PRIME: TEL:
0000 X. Xxxxxxxxxx Xxxxxx 00000 X. Xxxx Xxxxx
Xxxxxxxxx, XX 00000 Xxxxx 000
Xxxxx, XX 00000
or to such other address as any party may hereafter specify in writing as his
or its own address to the other party.
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7.04 ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement between the parties and supersedes and cancels any other agreement,
representations, or communication, whether oral or written, between the parties
hereto relating to the transactions contemplated herein or the subject matter
hereof
7.05 HEADINGS. The section and subsection headings in this
Agreement are inserted for convenience only and shall not affect in any way the
meaning or interpretation of this Agreement.
7.06 GOVERNING LAW. This Agreement shall be governed by and
construed and enforced in accordance with the laws of the State of Florida and
venue shall lie in the County of Pinellas.
7.07 ASSIGNMENTS. This Agreement shall inure to the benefit of and
be binding upon the parties hereto and their successors and assigns; provided,
however, that any assignment by either party of its rights under this Agreement
without the Written consent of the other party shall be void.
7.08 UNDERSTANDING. The Parties hereto acknowledge that they have
read and understood this entire agreement.
7.09 VALIDITY, Should any section of this agreement be deemed
invalid by a court of competent jurisdiction, the remaining section shall
remain in full force and effect.
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7.10 FACSIMILE SIGNATURES. Any facsimile signature on this
Agreement shall be considered an original and shall have the full force and
effect as if it were in fact an original.
WHEREFORE, acknowledged as set forth above, the Parties hereto have affixed
their signatures below.
July 21, 1997
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Date
/s/ Xxxxxxx X. Xxxxx
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Prime Equities Group, Inc.
July 21, 1997
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Date
/s/ Xxxxx Xxxxxxxx /s/ Xxxxxxx Xxxxxx
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For Tel Com Plus California, L.L.C.
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