EXHIBIT 7.2
STOCK PURCHASE AGREEMENT
STOCK PURCHASE AGREEMENT made this 10th day of December, 1998, between
XXXXXX XXXXXXX, XXXXXXX XXXXXXX, XXXX XXXXXXXX and REVISION LLC, a Delaware
limited liability company ("Revision").
WHEREAS, each of the parties hereto is a stockholder of Total-Tel USA
Communications, Inc., a New Jersey corporation (the "Company").
WHEREAS, the parties hereto desire to enter into certain agreements
regarding the purchase by Revision from Xxxxxx Xxxxxxx and Xxxxxxx Xxxxxxx
and/or their designees of up to 1,200,000 shares of Common Stock of the Company
("Common Stock"), on the terms and subject to the conditions set forth herein.
WHEREAS, the parties hereto desire to enter into certain agreements
regarding the voting of their shares of Common Stock and certain other matters,
on the terms and subject to the conditions set forth herein.
NOW, THEREFORE, for good and valid consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto agree as
follows:
1. PURCHASE AND SALE OF SHARES.
(A) GENERAL TERMS. Revision agrees to purchase from Xxxxxx Xxxxxxx,
Xxxxxxx Xxxxxxx, and if so designated, one or more of their designees (in an
amount to be determined by Xxxxxx Xxxxxxx and Xxxxxxx Xxxxxxx), and Xxxxxx
Xxxxxxx and Xxxxxxx Xxxxxxx agree to sell, up to an aggregate of 1,200,000
shares of Common Stock, but not less than 1,100,000 shares of Common Stock, at
a purchase price of $24 per share upon the terms and subject to the conditions
set forth herein. Prior to December 20, 1998, Xxxxxx Xxxxxxx and Xxxxxxx
Xxxxxxx shall deliver to Revision a written notice (the "Designee Notice"),
setting forth the aggregate number of shares which shall be purchased by
Revision pursuant to this Section 1, listing each designee (the "Designees",
which term shall include Xxxxxx Xxxxxxx and Xxxxxxx Xxxxxxx) who will sell
shares, the number of shares to be sold by each such Designee, the account
information (name of bank, address of bank, ABA number and bank account number)
to which the purchase price payment for such designee should be wired, and the
purchase price. The Deposit (as defined below) shall be paid at the closing as
directed by Xxxxxx Xxxxxxx and Xxxxxxx Xxxxxxx and shall be credited against
the purchase price. The Designees shall be solely responsible for any transfer
taxes payable in respect of the sale of the Common Stock under this Agreement.
(B) REPRESENTATIONS AND WARRANTIES OF DESIGNEES. The Designee Notice
shall be accompanied by signed statements of each Designee (the "Designee
Statements"), pursuant to which each Designee represents and warrants to
Revision that (i) such Designee is the sole beneficial and
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record owner of all right, title and interest in and to the shares to be sold
to Revision, free and clear of any security interest, claims, liens, pledges,
options, encumbrances, charges, agreements, voting trusts, proxies, preemptive
rights or rights of first refusal or other arrangements, restrictions or legal
or equitable limitations of any kind, (ii) upon the delivery of the stock
certificates at the closing, such Designee will transfer good, valid and
marketable title to the shares to Revision, free and clear of any security
interests, claims, liens, pledges, options, encumbrances, charges, agreements,
voting trusts, proxies, preemptive rights or rights of first refusal or other
arrangements, restrictions or legal or equitable limitations of any kind and
(iii) such Designee shall, at the closing deliver to Revision, a certificate
confirming that the representations of such Designee made therein are true as
of the closing date. Xxxxxx Xxxxxxx beneficially owns between 1,000,544 and
1,035,524 shares of Common Stock and Xxxxxxx Xxxxxxx beneficially owns between
886,380 and 927,260 shares of Common Stock (in each case exclusive of stock
options), and each of Xxxxxx Xxxxxxx and Xxxxxxx Xxxxxxx hereby makes the
representations and warranties set forth in this Section 1(b) with respect to
himself and the shares which he owns as of the date hereof.
(C) REPRESENTATIONS OF REVISION. Revision represents and warrants to
each of Xxxxxx Xxxxxxx, Xxxxxxx Xxxxxxx and each Designee that it is acquiring
up to 1,200,000 shares of Common Stock pursuant to the provisions of this
Section 1 for its own account for investment and not with a view to, or for
sale in connection with, any public distribution thereof in violation of the
Securities Act of 1933, as amended (the "Securities Act"). Revision further
represents that it is an Accredited Investor within the meaning ascribed to
such term under Regulation D of the rules and regulations promulgated under the
Securities Act.
(D) CONDITIONS TO CLOSING AND THE CLOSING. It shall be a condition to
the purchase and sale of shares contemplated under this Section 1 that (i) the
waiting period (and any extension thereof) under the Xxxx-Xxxxx-Xxxxxx
Antitrust Improvements Act of 1976, as amended (the "HSR Act") applicable to
the purchase by Revision of the aggregate number of shares to be purchased
pursuant to this Section 1 shall have expired or been terminated and (ii) the
Superior Court of New Jersey, Chancery Division, Passaic County (the "Court")
shall have rescinded, revoked or otherwise caused to be ineffective any Court
orders outstanding in connection with the lawsuit against the Company which was
filed in the Court on or about April 7, 1998, by Gold & Xxxxx Transfer, S.A.,
Docket No. PAS-C49-98. The closing of the purchase and sale of shares
contemplated in this Section 1 shall occur at 10:00 a.m. on the date that is
two business days after the satisfaction of both of the conditions set forth in
the preceding sentence; provided however that the closing date shall in no
event be earlier than January 2, 1999. The closing shall take place at the
offices of Xxxxxxx Berlin Shereff Xxxxxxxx, LLP, 000 Xxxxx Xxxxxx, Xxx Xxxx,
Xxx Xxxx. Xx the closing date, Revision shall pay to each Designee the purchase
price (net of such Designee's pro rata share of the Deposit as designated
pursuant to Section 1(a)) by wire transfer to the account set forth in the
Designee Notice and each Designee shall deliver the stock certificates for the
shares duly endorsed or with stock power attached together with the
representation letter required pursuant to of Section 1(b) above.
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(E) DEPOSIT. Within five (5) business days of the execution and
delivery of this Agreement, Revision shall transfer $4,000,000 by wire transfer
to Xxxxxxx Berlin Shereff Xxxxxxxx, LLP as escrow agent (the "Escrow Agent"),
and such $4,000,000 shall be held in escrow by the Escrow Agent as a deposit
("Deposit") pursuant to an escrow agreement containing the terms of this
Section 1(e) and other customary terms. In the event that prior to the closing,
the Escrow Agent receives a written notice from Revision, on the one hand, or
Xxxxxx Xxxxxxx or Xxxxxxx Xxxxxxx, on the other hand, stating that a material
breach by the other party has occurred under this Agreement or, in the case of
a notice by Revision that a material breach by the Company has occurred under
that certain agreement dated the date hereof by and among the Company, Xxxx
Xxxxxxxx and Revision, then, the Deposit, together with interest earned
thereon, shall be delivered to the nonbreaching party unless the party alleged
to have breached (or Xxxxxx Xxxxxxx or Xxxxxxx Xxxxxxx in the case of an
alleged breach by the Company) shall deliver, within five business days of
notice thereof, a notice of objection to the Escrow Agent in which case the
Deposit shall not be disbursed from escrow until such time as the Escrow Agent
has received joint written instructions of Xxxxxx Xxxxxxx, Xxxxxxx Xxxxxxx and
Xxxx Xxxxxxxx, directing the disbursement of such Deposit or until such time as
the Escrow Agent has received a court order from a court of competent
jurisdiction directing the disposition of such Deposit. At least one business
day prior to the closing, Xxxxxx Xxxxxxx, Xxxxxxx Xxxxxxx and Xxxx Xxxxxxxx
shall deliver to the Escrow Agent joint written instructions directing the
transfer of the Deposit. Each disbursement of the Deposit from escrow shall
include the pro rata portion of interest income, if any, with respect to such
disbursement amount. In the event that Revision is legally prohibited from
purchasing the shares of the Common Stock as contemplated under this Section 1
due to a failure to be satisfied of one of the conditions to closing contained
in Section 1(d) by February 28, 1999, the Deposit, together with interest
earned thereon, shall be returned to Revision unless Xxxxxx Xxxxxxx or Xxxxxxx
Xxxxxxx shall have delivered notice of objection within five business days of
notice from the Escrow Agent of the intended payment to Revision, in which case
the Deposit shall not be disbursed from escrow until such time as the Escrow
Agent has received joint written instructions of Xxxxxx Xxxxxxx, Xxxxxxx
Xxxxxxx and Xxxx Xxxxxxxx, directing the disbursement of such Deposit or until
such time as the Escrow Agent has received a court order from a court of
competent jurisdiction directing the disposition of such Deposit.
2. BOARD OF DIRECTORS. Immediately following the closing of the sale
of shares pursuant to Section 1 hereof, Xxxxxx Xxxxxxx and Xxxxxxx Xxxxxxx
shall use their respective best efforts to cause the resignation of Messrs.
Xxxxxxx Xxxxxxx, Xxxx Xxxxxx and Xxxxxx Xxxxx from the Board of Directors of
the Company (the "Board") and to cause the election to the Board of the
following persons to the vacancies on the Board created thereby: (a) Xxxx
Xxxxxxxx, (b) Xxxxxx Xxxxx or if he is unable to serve, another designee of Xx.
Xxxxxxxx, and (c) an individual who has no affiliation with the Company and is
designated by Xxxx Xxxxxxxx. (The six members of the Board as reconstituted
pursuant to the terms of this Section 2 are sometimes referred to herein as the
"Reconstituted Board".)
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3. VOTING AGREEMENTS.
(A) NEXT ANNUAL MEETING. At the next Annual Meeting of
Shareholders of the Company to be held no later than February 28, 1999 and for
a period ending one year from the date hereof, Xxxx Xxxxxxxx and Revision
agree, on the one hand, and Xxxxxx Xxxxxxx and Xxxxxxx Xxxxxxx agree, on the
other hand, to vote the shares of Common Stock owned by them in favor of the
election to the Board of the six members of the Reconstituted Board, or if any
one of such members shall be unwilling or unable to serve, then in favor of a
substituted designee of Xxxx Xxxxxxxx or Xxxxxx Xxxxxxx, as the case may be.
For a period of one year commencing on the date hereof, the parties agree to
use their respective best efforts to cause the number of directors comprising
the complete Board to be fixed at six (6).
(B) SUBSEQUENT PERIOD. For the period commencing 12 months from
the date hereof and ending 36 months from the date hereof, Xxxx Xxxxxxxx and
Revision agree to vote the shares of Common Stock beneficially owned by them in
favor of the election to the Board of Directors of the Company of two nominees
designated by Xxxxxx Xxxxxxx (one of whom may be Xxxxxx Xxxxxxx). For the
period commencing 12 months from the date hereof and ending 36 months from the
date hereof, Xxxxxx Xxxxxxx and Xxxxxxx Xxxxxxx agree to vote the shares of
Common Stock beneficially owned by them in favor of the election to the Board
of Directors of the Company of the nominees (regardless of the number of such
nominees) designated by Xxxx Xxxxxxxx. The provisions of this Section 3(b)
shall cease to be of any further force and effect if at any time the aggregate
beneficial ownership of Common Stock by Xxxxxx Xxxxxxx and Xxxxxxx Xxxxxxx on
the one hand, or Xxxx Xxxxxxxx and Revision, on the other hand, shall fall
below 5% of the then outstanding Common Stock.
(C) XXXXXXX EMPLOYMENT CONTRACT. Xxxx Xxxxxxxx and Revision agree
to use their best efforts to cause the Company as soon as practical after the
Reconstituted Board is elected to enter into a one year employment contract
with Xxxxxx Xxxxxxx, pursuant to which Xxxxxx Xxxxxxx will be employed as Chief
Executive Officer and Chairman of the Board of the Company at a salary of
$250,000 per year and with incentive compensation up to $250,000 as may be
determined by the Board based upon performance targets set by the Board for
executive officers generally. Such agreement will supercede any prior
agreements between Xxxxxx Xxxxxxx and the Company with respect to Xx. Xxxxxxx'x
employment by the Company.
4. ORDINARY COURSE. During the period from the date of this Agreement
and continuing until the Board is reconstituted in accordance with Section 2
hereof, each of Xxxxxx Xxxxxxx and Xxxxxxx Xxxxxxx shall use their respective
best efforts to cause the Company to carry on its business in the usual,
regular and ordinary course in substantially the same manner as heretofore
conducted and use its best efforts to preserve intact its present business
organizations, and to preserve its relationships with customers, suppliers and
others having business dealings with it to the end that its goodwill and
ongoing business shall not be impaired in any material respect.
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5. ADDITIONAL AGREEMENTS; BEST EFFORTS. Subject to the terms and
conditions of this Agreement, each of the parties hereto agrees to use its best
efforts to take, or cause to be taken, all action and to do, or cause to be
done, all things necessary, proper or advisable under applicable laws and
regulations to consummate and make effective the transactions contemplated by
this Agreement.
6. CERTAIN REPRESENTATIONS BY THE FELDMANS. Each of Xxxxxx Xxxxxxx
and Xxxxxxx Xxxxxxx hereby represents and warrants that (i) this Agreement has
been duly executed and delivered by him and constitutes his legal, valid and
binding obligation, enforceable against him in accordance with its terms, (ii)
subject to the provisions of Section 1(d) hereto, the execution, delivery and
performance by him of this Agreement will not violate any order, writ,
injunction, decree, statute, rule or regulation applicable to him, and (iii) to
the best of their knowledge after due inquiry, except as disclosed in the
forms, reports, schedules, statements and other documents filed by the Company
under the Securities Exchange Act of 1934, as amended, and in the draft
financial statements with respect to the fiscal quarter of the Company ended
October 31, 1998, which were provided to Xxxx Xxxxxxxx, since January 31, 1998,
there have been no events, changes or effects (excluding any of the foregoing
which affect the industry generally, and are not specific to the Company)
having, individually or in the aggregate, a material adverse effect on the
Company.
7. CERTAIN REPRESENTATIONS BY REVISION AND XXXX XXXXXXXX. Revision
hereby represents and warrants that (i) the execution, delivery and performance
by Revision of this Agreement has been duly authorized by all action required
by law, its certificate of formation and operating agreement, (ii) this
Agreement has been duly executed and delivered by Revision and constitutes a
legal, valid and binding obligation of Revision, enforceable against it in
accordance with its terms, (iii) the execution, delivery and performance by
Revision of this Agreement will not conflict with or result in any breach of
any provision of the certificate of formation and operating agreement of
Revision, (iv) the execution, delivery and performance by Revision of this
Agreement will not result in a violation or breach of, or constitute (with or
without due notice or lapse of time or both) a default (or give rise to any
right of termination, amendment, cancellation or acceleration) under, any of
the terms, conditions or provisions of any note, bond, mortgage, indenture,
lease, license, contract, agreement or other instrument or obligation to which
Revision is a party or by which any of its assets or properties may be bound,
(v) subject to the provisions of Section 1(d) hereto, the execution, delivery
and performance by Revision of this Agreement will not violate any order, writ,
injunction, decree, statute, rule or regulation applicable to Revision or any
of its properties or assets, (vi) Revision is the sole beneficial and record
owner of all right, title and interest in and to 1,857,434 shares of Common
Stock, free and clear of any security interest, claims, liens, pledges,
options, encumbrances, charges, agreements, voting trusts, proxies, preemptive
rights or rights of first refusal or other arrangements, restrictions or legal
or equitable limitations of any kind, and (vii) Revision has no outstanding
indebtedness for borrowed money. Xxxxxxxx hereby represents and warrants that
(i) this Agreement has been duly executed and delivered by him and constitutes
his legal, valid and binding obligation, enforceable against him in accordance
with its terms, and (ii) subject to the provisions of Section 1(d) hereto, the
execution, delivery and performance by him of this Agreement will not violate
any order, writ, injunction, decree, statute, rule or regulation applicable to
him.
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8. ASSIGNMENT. This Agreement shall inure to the benefit of the
parties hereto and their respective successors and permitted assigns. None of
Xxxxxx Xxxxxxx or Xxxxxxx Xxxxxxx, on the one hand, or Xxxx Xxxxxxxx or
Revision, on the other hand, shall have the right to assign or transfer shares
of Common Stock or its rights or obligations under this Agreement to an
affiliate of such party unless (i) such transferee affiliate has a net worth
(calculated in accordance with generally accepted accounting principles) at
least equal to the net worth of the transferor immediately prior to such
transfer and (ii) such transferee affiliate assumes the obligations of the
transferor hereunder.
9. ENTIRE AGREEMENT. This Agreement contains the entire agreement
between the parties hereto and constitutes the complete, final and exclusive
embodiment of their agreement with respect to the subject matter hereof, and
supercedes all prior or contemporaneous agreements, understandings,
representations and statements, oral or written.
9. NOTICES. All communications provided for hereunder shall be sent
in writing and mailed by first class mail, return receipt requested, or sent by
overnight courier, or sent by facsimile transmission to the address stated
below or to such changed address as the addressee may have been given by
similar notice:
(a) If to the Xxxxxx Xxxxxxx or Xxxxxxx Xxxxxxx:
Total-Tel USA Communications, Inc.
000 Xxxxx Xxxx
Xxxxxx Xxxxx, Xxx Xxxxxx 00000
Attn: Xxxxxx Xxxxxxx
Facsimile No.: (000) 000-0000
With a copy to:
Xxxxxxxxx & Xxxxxxx
0000 Xxxxxxxxxxxx Xxxxxx, X.X.
Xxxxxxxxxx, X.X. 00000
Attn: Xxxxx X. Xxxxxxxxxx, Esq.
Facsimile No.: (000) 000-0000
(b) If to Revision or Xxxxxxxx:
Xxxx Xxxxxxxx
c/o Gold & Xxxxx
0000 00xx Xxxxxx, 0xx Xxxxx
Xxxxxxxxxx, X.X. 00000
Facsimile No.: (000)000-0000
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With a copy to:
Xxxxxxx Berlin Shereff Xxxxxxxx, LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxxx Xxxxxxxx, Esq.
Facsimile No.: (000) 000-0000
Any such notice shall be deemed received, if mailed, five days after mailing,
one day after sending by overnight courier, or upon confirmation of
transmission if sent by facsimile transmission.
11. NOTICE ON BEHALF OF OTHER PARTIES. Any notice, designation or
determination required to be made or delivered hereunder by Xxxxxx Xxxxxxx or
Xxxxxxx Xxxxxxx shall be binding on the other if made or delivered by either of
such parties. Any notice, designation or determination required to be made or
delivered hereunder by Revision or Xxxx Xxxxxxxx shall be binding on the other
if made or delivered by either of such parties.
12. GOVERNING LAW. This Agreement shall be governed by and construed
in accordance with the laws of the State of New Jersey, without giving effect
to the conflict of laws provisions thereof.
13. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, all of which together
shall constitute one and the same instrument.
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IN WITNESS WHEREOF, the parties have caused this Agreement to
be executed the day and year first above written.
/s/ Xxxxxx Xxxxxxx
--------------------------
Xxxxxx Xxxxxxx
/s/ Xxxxxxx Xxxxxxx
--------------------------
Xxxxxxx Xxxxxxx
REVISION LLC
By: /s/ Xxxx Xxxxxxxx
--------------------------
Name: Xxxx Xxxxxxxx
Title: Manager
/s/ Xxxx Xxxxxxxx
--------------------------
Xxxx Xxxxxxxx
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