EXHIBIT 10.45
STOCK PURCHASE AGREEMENT
THIS STOCK PURCHASE AGREEMENT (this "Agreement") is made and entered
into as of the 30th day of June, 1998 by and among Xxxxxx Telecom, Inc., a
Delaware corporation,("Buyer"), Xxxx Xxxxxx ("X. Xxxxxx") Xxxxxx X. Xxxxxx ("X.
Xxxxxx"), and Xxxx Xxxxxx 1997 Charitable Remainder Trust (the "Trust") (X.
Xxxxxx, X. Xxxxxx and the Trust are collectively referred to as "Sellers").
R E C I T I A L S
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WHEREAS, Data Performance Inc. ("DPI"), an Illinois corporation, is
engaged in the business of providing information technology staffing and project
services (the "Business"): and
WHEREAS, Xxxxxx International, Inc. ("Xxxxxx"), a Maryland
corporation, is the parent company of Buyer; and
WHEREAS, X. Xxxxxx owns 45.9% of the issued and outstanding shares of
Common Stock of DPI; and
WHEREAS, X. Xxxxxx owns 49.0% of the issued and outstanding shares of
Common Stock of DPI; and
WHEREAS, the Trust owns 5.1% of the issued and outstanding shares of
Common Stock of DPI; and
WHEREAS, Buyer wishes to purchase and Sellers wish to sell to Buyer,
all of the issued and outstanding shares of DPI owned by them on the terms and
conditions set forth below:
A G R E E M E N T
- - - - - - - - -
NOW, THEREFORE, for and in consideration of the mutual promises herein
made, and for other good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, the parties hereto do hereby agree as follows:
ARTICLE I
PURCHASE AND SALE OF SHARES
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1.1 Purchase and Sale. Subject to the terms and conditions of this
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Agreement, effective as of 12:01 a.m. Central Daylight Time on June 29, 1998
(the "Closing Date"), Buyer agrees to purchase from Sellers and Sellers agrees
to sell, assign, transfer and deliver to Buyer, 1,000 of the issued and
outstanding shares of common stock of DPI, comprising 100% of the total issued
and outstanding shares of stock of DPI (the "DPI Stock").
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1.2 Acquired Assets. The Business shall include, without limitation,
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all of the following assets (the "Assets") of DPI:
(a) Office furniture and equipment, computers, equipment leases, real
estate leases, and leasehold improvements, as set forth in
Schedule 1.2(a) of the Disclosure Schedules attached hereto
("Disclosure Schedules").
(b) Computer software owned or licensed by DPI as set forth in
Schedule 1.2(b), along with DPI's interest in any other computer
software licensed by it from others.
(c) Other agreements, contracts and instruments as set forth in
Schedule 1.2(c).
(d) All subcontractor agreements and agreements with suppliers to
provide consultants to DPI, including, but not limited to, those
set forth in Schedule 1.2(d) ("Subcontractor Agreements").
(e) The client agreements, purchase orders, requests, requirements,
correspondence, memoranda, and inquiries with past, present and
potential customers, including, but not limited to, those forth in
Schedule 1.2(e)("Client Agreements").
(f) All prepayments and deposits, including, without limitation,
security deposits under leases.
(g) The corporate name Data Performance, Inc., all assumed names
relating thereto, logos, trademarks, service marks, domain names,
trade names, copyrights, registrations, applications for
registration of any of them, and any other intellectual property
rights of Seller, including, but not limited to, those listed in
Schedule 1.1(g).
(h) Originals of all books and records of DPI pertaining to the
Assets, including customer lists and credit files, and all those
pertaining to DPI's employees who are retained by Buyer pursuant
to the Agreement.
(i) All permits, licenses, approvals and other governmental
authorizations relating to the Business including, but not limited
to, those listed in Schedule 1.1 (i).
(j) Any other asset not referred to in Section 1.3 which is used by
DPI in connection with the Business, including, without
limitation, all telephone and facsimile numbers and e-mail
addresses used by DPI in connection with the Business.
(k) All goodwill pertaining to the Business.
(l) All agreements, rights to employ and information for or with
respect to DPI's
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current or former employees including, without limitation, all
tangible and electronic manifestations, files, resumes, payroll
employee information and other such information relating to
employees and consultants.
1.3 Excluded Assets and Excluded Liabilities.
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(a) Prior to the Closing Date, Sellers and DPI shall collect all
receivables or notes from Sellers or affiliated parties,
including, without limitation, the receivables and notes set
forth in Schedule 1.3 (a) ("Excluded Assets").
(b) Prior to the Closing Date, Sellers and DPI shall pay off all
debts or liabilities to affiliated parties, including, without
limitation, the debt set forth in Schedule 1.3 (b) ("Excluded
Liabilities").
1.4 Purchase Price. Subject to the Net Equity requirement set forth
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below, Buyer shall pay the Sellers, in full payment for the
Stock, as follows:
(a) The "Unadjusted Purchase Price." The Unadjusted Purchase Price
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shall be $10,300,000, $750,000 of which shall be paid by wire
transfer of immediately available funds at the Closing to an
account designated by Sellers in writing, and $9,550,000 of which
shall be held in escrow pursuant to the provisions of Section 1.6
hereof.
(b) Payment of Net Equity. Within 90 days after the Closing Date,
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Buyer will provide to Sellers a balance sheet as of the Closing
Date, prepared on an accrual basis in accordance with generally
accepted accounting principles, as consistently applied, ("GAAP")
(the "Closing Date Balance Sheet"), which Closing Date Balance
Sheet shall: (i) include, without limitation, a liability account
for income taxes payable, and (ii) exclude Excluded Assets and
Excluded Liabilities. Sellers will work in good faith with Buyer
in providing Buyer the necessary information for Buyer to prepare
the Closing Date Balance Sheet. The Closing Date Balance Sheet
will set forth the Net Equity, as defined below. Sellers will pay
to Buyer the Net Equity below $950,000, if any, within 120 days
after the Closing Date. Buyer will pay to Sellers the Net Equity
above $950,000, if any, within 120 days after the Closing Date.
The term "Net Equity" shall be defined as all assets less all
liabilities of DPI, calculated on an accrual basis in accordance
with GAAP. Excluded Assets and Excluded Liabilities will not be
included in the determination of Net Equity. The term "Final
Purchase Price" shall be defined as the Unadjusted Purchase
Price, as adjusted pursuant to the terms of this paragraph. In
the event Buyer fails to deliver the Closing Date Balance Sheet
within 90 days after the Closing Date, the Unadjusted Purchase
Price shall be deemed the Final Purchase Price.
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1.5 Stock Free of Liens. The Stock to be transferred hereunder shall
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be transferred free and clear of all liens, claims, encumbrances, mortgages,
pledges, restrictions or rights of others of every kind and description.
1.6 Escrow . $750,000 of the Unadjusted Purchase Price shall be
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placed in an escrow (the "Escrow Account") with a mutually acceptable escrow
agent (the "Escrow Agent") pursuant to the Escrow Agreement attached hereto as
Exhibit A
1.7 Dispute Resolution. If the Sellers have any objections to the
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Closing Date Balance Sheet determination defined in Section 1.4(b) Sellers shall
deliver a statement describing their objections ("Statement of Objections") to
the Buyer within 20 business days after receipt thereof. Within 20 business
days of receipt by the Buyer of the Statement of Objections, the Buyer shall
review the determination to which the objection relates and supply the Sellers
with a reasonably detailed response. If the Sellers continues to have any
objections to the Closing Date Balance Sheet/ determination, the Sellers shall
confirm in writing such objections within five business days after receipt of
the response ("Objection Confirmation"). The Sellers and Buyer shall use
reasonable efforts to resolve any objections to the Closing Date Balance
Sheet/determination. If an Objection Confirmation is given and the parties fail
to reach an agreement with respect to the Closing Date Balance Sheet/
determination within 20 business days after Buyer's receipt of the Objection
Confirmation, the parties shall submit the dispute for resolution to the Xxxx
County Office of one of the six largest firms of independent certified public
accountants (the "Accountant"), other than Buyer's or the Sellers' accountants
as of the Closing, within five business days after the end of the 20-business-
day period. Each of the Sellers and the Buyer may submit such information to the
Accountant as such party deems relevant on or before the expiration of such
period. If the Sellers and the Buyer do not agree upon the selection of the
Accountant, the selection will be made by the Xxxx County office of the American
Arbitration Association ("AAA") in accordance with the criteria specified above,
or if no such Accountant is available or willing to resolve the dispute, the AAA
shall select the next largest accounting firm from which a qualified accountant
is available in Xxxx County, Illinois. The Accountant shall, within 20 business
days after appointment as provided herein, render its determination as to the
Closing Date Balance Sheet determination and the amount so selected shall be
final and binding on the parties. Any such amount shall be payable with simple
interest thereon at 8 percent from the due date of such payment. The fees and
expenses of the Accountant shall be paid by the party whose determination was
not selected, and if neither party's determination is selected, shall be
allocated between the parties based upon the proportion in which the final
determination was reflective of their respective positions.
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF CERTAIN SELLERS
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In order to induce Buyer to enter into this Agreement, X. Xxxxxx and
X. Xxxxxx (collectively, the "Individual Sellers") , jointly and severally,
represent and warrant to the Buyer
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that the statements contained in this Article II are correct and complete as of
the date of this Agreement and will be correct and complete as of the Closing
Date (as though made then and as though the Closing Date were substituted for
the date of this Agreement throughout this Article II).
2.1 Authority Relative to this Agreement. The Sellers have the full
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power and authority to execute, deliver and perform this Agreement and any
agreement or document contemplated hereby, and to consummate the transactions
contemplated hereby or thereby. The obligations imposed on Sellers by this
Agreement, or by any agreement or document contemplated hereby, constitute the
valid and binding obligations and agreements of Sellers, enforceable against
each of them in accordance with their respective terms except that (i) such
enforcement may be subject to bankruptcy, insolvency, reorganization, moratorium
or other similar laws now or hereafter in effect relating to creditors' rights;
and (ii) the remedy of specific performance and injunctive and other forms of
equitable relief may be subject to equitable defenses and to the discretion of
the court before which any proceeding therefor may be brought. Each person
whose signature appears on the signature page of this Agreement as a trustee is
a trustee of the trust on behalf of which such person has signed this Agreement
and such person has full power and authorization, acting alone and without the
joinder of any other person, to legally bind such trust.
2.2 Compliance of Transaction With Laws and Other Instruments. Except
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as set forth in Schedule 2.2 of the Disclosure Schedules, the execution,
delivery and performance by Sellers of this Agreement and any agreement or
document contemplated hereby, and the performance and consummation of the
transactions contemplated hereby or thereby by Sellers (i) do not require on
behalf of Sellers or DPI, any approval, consent or waiver of, or filing with,
any governmental agency, court or other authority which has not been obtained
and which is not in full force and effect as of the date hereof; (ii) will not
conflict with or constitute a breach or violation of the charter or bylaws of
DPI; (iii) will not result in a violation of any law, regulation, judgment,
writ, injunction, order or decree of any court or governmental or regulatory
authority (federal, local or otherwise) to which DPI is subject; and (iv) will
not require the approval, consent or waiver of, or filing with any party to,
violate or conflict with or result in a breach of, or constitute a default or
acceleration of or give rise to a right of termination (or an event which with
notice or lapse of time or both would become a default) under, any provision of
any contract, indenture, mortgage, lease, agreement or other instrument to which
Sellers or DPI are parties or to which any of their or its assets are subject.
2.3 Capitalization. The entire authorized capital stock of DPI
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consists of 1,000 shares of common stock, $1.00 par value ("Common Shares"), of
which 1,000 Common Shares are issued and outstanding. All of the issued and
outstanding Common Shares have been duly authorized, are validly issued, fully
paid, and nonassessable. There are no outstanding or authorized options,
warrants, purchase rights, subscription rights, conversion rights, exchange
rights, or other contracts or commitments that could require DPI to issue, sell,
or otherwise cause to become outstanding any of its capital stock. There are no
outstanding or authorized stock appreciation, phantom stock, profit
participation, or similar rights with respect to DPI.
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There are no voting trusts, proxies, or other agreements or understandings with
respect to the voting of the capital stock of DPI. No debt instrument issued by
DPI has or could have voting rights.
2.4 Stock. X. Xxxxxx, X. Xxxxxx and the Trust hold of record and own
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beneficially 459, 490 and 51 Common Shares of DPI, respectively, free and clear
of any restrictions on transfer (other than any restrictions under federal or
state securities laws), taxes, security interests, options, warrants, purchase
rights, contracts, commitments, equities, claims, and demands. No Seller is a
party to any option, warrant, purchase right, or other contract or commitment
that could require such Seller to sell, transfer, or otherwise dispose of any
capital stock of DPI (other than this Agreement). No Seller is a party to any
voting trust, proxy, or other agreement or understanding with respect to the
voting of any capital stock of DPI.
2.5 Organization and Qualification. DPI is a corporation duly
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organized, validly existing and in good standing under the laws of its
jurisdiction of incorporation and has all requisite corporate power and
authority to own, lease and operate its assets and properties and to conduct the
Business in the manner and in the places where such assets and properties are
owned, leased or operated or the Business is conducted by it. DPI has no
subsidiaries and does not own, directly or indirectly, any equity interest in
any corporation, partnership, joint venture or other business entity. Sellers
have delivered to the Buyer correct and complete copies of the charter and
bylaws of DPI (as amended to date). The minute book (containing the records of
meetings of the stockholders, the board of directors, and any committees of the
board of directors), the stock certificate book and the stock record book of DPI
are correct and complete. DPI is not in default under or in violation of any
provision of its charter or bylaws.
2.6 Financial and Other Statements. Schedule 2.6 of the Disclosure
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Schedules contains true and complete copies of (i) DPI's balance sheet and
income statement (excluding notes) the year ended December 31, 1997, and (ii)
DPI's balance sheet and income statement (excluding notes) for the twelve month
period ended March 31, 1998 (collectively the "Financial Statements"), in both
cases compiled by an independent public accountant. Except as set forth in
Schedule 2.6 , the Financial Statements (i) have been prepared in accordance
with generally accepted accounting principles on a consistent basis, and (ii)
fairly present in all material respects the financial position and results of
operation of DPI as of the indicated dates and for the period indicated therein.
2.7 Title to Properties; Liens; Condition of Properties. DPI has good
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and marketable title to or a valid leasehold in, the properties and assets used
by it, located on its premises, or shown in the Financial Statements or acquired
after the date thereof, which shall exclude the "Excluded DPI Assets" as defined
in Section 1.3. None of such assets are subject to any mortgage, pledge, lien,
conditional sale agreement, security interest, encumbrance, title defect or
other charge, except for liens for taxes not yet due and payable. Schedule 2.7
of the Disclosure Schedules sets forth the addresses or locations of all
facilities (whether leased or owned) of DPI.
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2.8 No Undisclosed Liabilities. There are no contractual or non-
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contractual obligations, debts or liabilities of any nature of DPI whether
accrued or unaccrued, contingent or absolute, direct or indirect, recorded or
unrecorded, potential or realized (the "Liabilities") as of the date of the
Financial Statements, which are not otherwise disclosed in the Financial
Statements or in the Schedules to this Agreement. DPI has not incurred any
Liabilities since March 31, 1998, except for those Liabilities incurred in the
ordinary course of business and consistent with past practice and which, in any
event, would not, in the aggregate, have a material adverse effect on the
Business. DPI is not directly or indirectly (i) liable, by guaranty, surety or
otherwise, upon or with respect to, or (ii) obligated in any way to provide
funds in respect of, or (iii) obligated to guaranty or assume any debt, dividend
or other obligation of any person, corporation, association, partnership or
other entity.
2.9 Tax Matters. Except as set forth on Schedule 2.9 of the
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Disclosure Schedules, DPI has filed (i) all federal, state, municipal and local
tax returns (whether relating to income, sales, franchise, withholding, real or
personal property, employment or otherwise) ("tax returns") required to be
filed; (ii) all federal, state, municipal and local tax returns (whether
relating to income, sales, franchise, withholding, real or personal property,
employment of otherwise) ("taxes") which are due, pursuant to such returns, or
claimed to be due by any taxing authority, or otherwise due and owing, and any
penalties or other charges due with respect to the late filing of any such
return have been fully paid, and shall be fully paid at the time of closing;
(iii) each such tax return heretofore filed by DPI correctly and accurately
reflects the amount of its tax liability thereunder; (iv) DPI is not currently
the beneficiary of any extension of time within which to file any tax return;
(v) no claim has ever been made by an authority in a jurisdiction where DPI does
not file tax returns that it is or may be subject to taxation by that
jurisdiction; (vi) there are no security interests on any of the assets of DPI
that arose in connection with any failure (or alleged failure) to pay any tax;
(vii) DPI has withheld and paid all taxes required to have been withheld and
paid in connection with amounts paid or owing to any employee, creditor,
independent contractor, or other third party and all such taxes shall be
withheld or paid by Closing and all such taxes accrued but not due as of Closing
shall be escrowed with Buyer; (viii) Sellers do not expect any authority to
assess any additional taxes for any period for which tax returns have been
filed; and (ix) there is no dispute or claim concerning any tax liability of
DPI.
2.10 Absence of Certain Changes. Except as set forth in Schedule
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2.10, since March 31, 1998, there has not been:
(a) any material adverse change in the financial condition,
properties, assets, liabilities, personnel or operations of DPI;
(b) any obligation or liability incurred by DPI, including the
obligation to perform services normally conducted by the Business, other than
obligations and liabilities incurred in the ordinary course of business;
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(c) any purchase, sale or other disposition, or any agreement or other
arrangement for the purchase, sale or other disposition, of any of the services,
properties or assets of the Business, except in the ordinary course of business;
(d) any damage, destruction or loss, whether or not covered by
insurance, affecting the Business;
(e) any loss or threatened loss of any permit, license, qualification
or certificate of authority held or enjoyed by DPI which loss has had, or could
in the future have, a material adverse effect on the business, properties,
financial condition or results of operation of the Business or Buyer's free and
unencumbered ownership and use of any of the assets or properties of the
Business, whether owned or leased, and whether or not carried or reflected on
the books and records of DPI;
(f) any pending or threatened labor disputes or strikes, labor union
organizational activity, claim or threatened claim of unfair labor practices, or
any material adverse change in relations with DPI's employees generally;
(g) any action taken by DPI outside of the ordinary course of
business;
(h) any written notice of termination of, or default under, any
contract;
(i) any loan or advance to or any investment in any person, firm or
corporation, except for normal business advances to employees consistent with
past practice;
(j) any increase in the compensation payable or to become payable to
any of DPI's officers or employees (other than nonmaterial increases in the
ordinary course of business) and there has been no establishment, adoption,
entering into, or making of any new grants or awards under, acceleration of
payment or vesting, or any creation of any obligation to grant any awards under,
or any amendment to any collective bargaining, bonus, profit sharing, thrift,
compensation, stock option or other equity, pension, retirement, incentive or
deferred compensation, employment, retention, termination, severance, health,
life or other welfare, fringe, Employee Benefit Plan (as defined in this Section
2.14), or other plan, agreement, trust, fund, policy or arrangement for the
benefit of any current or former directors, officers or employees, or any
granting or paying of any benefit not required by any existing DPI Benefit Plan
(as defined in this Section 2.14) or other existing plan or arrangement;
(k) any commitment for any addition to property, plant or equipment
not in the ordinary course of business by DPI;
(l) any payment, loan or advance of any amount to, or sale, transfer
or lease of assets to, or any agreements or arrangements with, any of DPI's
officers, directors or "affiliates," as such term is defined in the rules and
regulations of the Securities and Exchange Commission ("Affiliate");
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(m) any charitable or other capital contribution of DPI;
(n) any declaration, set aside or payment of any dividend, any
distribution with respect to its capital stock, or any redemption, repurchase,
or other acquisition of any of its capital stock;
(o) any failure to pay current liabilities, including accounts
payable and accrued expenses in the ordinary course of business and otherwise in
accordance with their terms; or
(p) any agreement or understanding by DPI to do any of the
foregoing.
2.11 Patents, Trademarks, Trade Names and Similar Rights. Except as
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set forth in Schedule 2.11, DPI does not own any trademarks, logos, service
marks, trade names, copyrights or other similar proprietary rights
("Intangibles") used in the Business, and, to the Sellers' knowledge, has no
obligation to any third party with respect thereto.
2.12 Trade Secrets and Customer Lists. DPI has the right to use,
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without liability to others, all trade secrets and customer lists, if any,
required and used in the Business within the last five years and has not
disclosed, sold, licensed, sublicensed or otherwise granted to any third party
the right to use such trade secrets and information. DPI is not using or in any
way making use of any confidential information or trade secrets of any third
party, including, without limitation, a former employer of any present or past
employee of DPI.
2.13 Client and Other Agreements. With respect to the Client
---------------------------
Agreements and the agreements set forth in Schedule 1.2(e) of the Disclosure
Schedules: (i) all such agreements are legal, valid, binding, enforceable, in
full force and effect, and subject to customer consent of the other party to
such agreement, are fully transferable to Buyer subject to no governmental or
regulatory requirement or impediment; (ii) all such agreements will be legal,
valid, binding and enforceable, and in full force and effect on the same terms
and conditions on the Closing Date; (iii) no party is in breach or default, and
no event has occurred which with notice or lapse of time would constitute a
breach or default, or permit termination, modification or acceleration under
said agreements; (iv) no party has repudiated any provision of said agreements;
(v) the list of agreements set forth in the Disclosure Schedules is a complete
and accurate list of all agreements between DPI and its customers; (vi) the
relationship of DPI with the customers that are parties to the agreements are
good and Sellers know of no set of facts, and have not received any notice or
information from any of the listed customers indicating an intention to decrease
the number or consultants (both employees and independent contractors placed
with DPI's customers ("Field Personnel")) or to decrease the level of services
DPI provides to any such customer, or to reduce the rates at which DPI is being
compensated from said customers, and no illegal or other payment or
consideration has been given by DPI to secure or maintain any business with its
customers; (vii) DPI has not received any notice of claims from any of the
listed customers relating to DPI's performance of service for such customers;
(viii) no material amount claimed to be payable to DPI under any of the
agreements is being disputed by any client; and (ix) none of such agreements
were awarded or are in any way based upon or related
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to the status of DPI as a minority business, small business, woman-owned
business, veteran-owned business or disadvantaged business enterprise or
individual.
2.14 Employee Agreements and Plans.
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(a) Except as set forth in Schedule 2.14 of the Disclosure
Schedules, neither DPI, nor any ERISA Affiliate presently maintains, contributes
to or has maintained, contributed to, or had (or may have) any liability under
any Employee Benefit Plan with respect to its employees, former employees, or
independent contractors. For purposes of this Section 2.14 and the Agreement:
(i) "DPI Benefit Plans" means the plans, programs and arrangements
set forth in Schedule 2.14 of the Disclosure Schedules.
(ii) "Employee Benefit Plan" means (a) any bonus, incentive
compensation, profit sharing, retirement, pension, group
insurance, death benefit, group health, medical expense
reimbursement, dependent care, legal services, flexible benefits
or cafeteria, stock option, stock purchase, stock appreciation
rights, phantom stock, savings, deferred compensation,
consulting, severance pay or termination pay, vacation pay,
leave of absence, layoff, life insurance, accident, disability,
workers' compensation, welfare or other employee benefit or
fringe benefit plan, program, arrangement practice or policy
which is an "employee pension benefit plan" as such term is
defined in Section 3(2) of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA") or an "employee
welfare benefit plan" as defined in Section 3(1) of ERISA,
whether written or unwritten; and
(iii) "ERISA Affiliate" means each person (as defined in Section 3(9)
of ERISA) that, together with DPI (or any person whose
liabilities DPI has assumed or is otherwise subject to, whether
directly or indirectly, including as a result of
indemnification) would be or has been treated as a single
employer under Section 4001(b) of ERISA or Section 414 of the
Internal Revenue Code of 1986, as amended ("Code").
Except with respect to DPI Benefit Plans, DPI does not have (nor
may have) any liability under any Employee Benefit Plan which an
ERISA Affiliate presently maintains, contributes to or has (or
may have) liability under.
(b) With respect to all employees and former employees of DPI,
neither DPI nor any ERISA Affiliate presently maintains,
contributes to or has or may have any liability under any funded
or unfunded medical, health or life insurance plan or
arrangement or other employee welfare benefit plan as defined in
Section 3(1) of ERISA for present or future retirees or present
or future terminated employees, except as required by the
Consolidated Omnibus Budget Reconciliation Act of 1985, as
amended ("COBRA") or state continuation coverage laws.
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(c) Favorable determination letters have been received by both DPI
and any master or prototype plan sponsor from the Internal
Revenue Service with respect to each DPI Benefit Plan which is
intended to comply with the provisions of Section 401(a) of the
Code, evidencing compliance with the relevant provisions of the
Tax Equity and Fiscal Responsibility Act of 1982, the Tax Reform
Act of 1984, the Retirement Equity Act of 1984, the Tax Reform
Act of 1986 and other applicable laws and governmental
regulations for which amendment is required by the Closing. Each
such DPI Benefit Plan complies in form and in operation with the
requirements of the Code and meets the requirements of a
"qualified plan" under Section 401(a) of the Code and each
related trust is exempt from federal income tax under Code
Section 501(a). No event has occurred or circumstance exists
that will or could give rise to disqualification or loss of tax-
exempt status of any such DPI Benefit Plan or trust.
(d) DPI, the ERISA Affiliates and all of their respective directors,
officers, employees and any other "fiduciary" (as such term is
defined in Section 3(21) of ERISA) have complied with and
performed all of their contractual obligations and all
obligations under the Code, ERISA and all applicable federal,
state and local laws, rules and regulations (domestic and
foreign) required to be performed by them under or with respect
to all of the DPI Benefit Plans and any related agreements and
there has been no "prohibited transaction" as defined by Section
4975 of the Code or Section 406 of ERISA with respect to any DPI
Benefit Plan. Any bonding required by ERISA with respect to the
DPI Benefit Plans has been obtained and is in full force and
effect .
(e) No DPI Benefit Plan has any unfunded liability and all accruals
with respect to the DPI Benefit Plans have been made. No DPI
Benefit Plan is subject to Section 412 of the Code, Section 302
of ERISA or Title IV of ERISA. All applicable contributions and
premium payments for all periods ending prior to the Closing
(including periods from the first day of the then current plan
year to the Closing) shall be made prior to the Closing Date in
accordance with past practice. No event has occurred or
circumstance exists that could result in a material increase in
premium costs of the DPI Benefit Plans that are insured or a
material increase in the benefit costs of such DPI Benefit Plans
that are self-insured.
(f) Neither DPI nor any ERISA Affiliate maintains, contributes to or
has or may have any liability (including current or potential
withdrawal liability) with respect to any "multi-employer plan"
as such term is defined in Section 3(37) or 4001(a)(3) of ERISA.
(g) Neither DPI nor any ERISA Affiliate has maintained an "employee
pension benefit plan", as such term is defined in Section 3(2)
of ERISA, that has been the subject of a "reportable event", as
such term is defined in Section 4043 of
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ERISA, as to which notices would be required to be filed with
the Pension Benefit Guaranty Corporation ("PBGC"), or any event
requiring disclosure under Section 4063(a) of ERISA. Neither DPI
nor any ERISA Affiliate has incurred any outstanding liability
under Section 4062 of ERISA to the PBGC or engaged in any
transaction described in Section 4069 of ERISA and all premiums
or other amounts due and payable to the PBGC have been paid.
Neither DPI nor any ERISA Affiliate has terminated any employee
pension benefit plan subject to Title IV of ERISA and no
proceeding by the PBGC to terminated any employee pension
benefit plan pursuant to Title IV of ERISA has ever been
instituted or threatened, no notice of any such termination has
been received and no condition exists which presents a material
risk of termination of a DPI Benefit Plan.
(h) There is no pending, threatened or anticipated legal action,
proceeding, investigation, dispute, grievance, charge,
complaint, restraining or injunctive order or claim against or
involving any DPI Benefit Plan maintained by DPI or any ERISA
Affiliate (other than routine claims for benefits) or the assets
of any such DPI Benefit Plan and to the best of Sellers'
knowledge and belief there is no basis for or any facts which
could give rise to any such legal action, proceeding,
investigation, dispute, grievance, charge, complaint,
restraining or injunctive order or claim. No DPI Benefit Plan is
presently under audit or examination (nor has notice been
received of a potential audit) by the Internal Revenue Service,
Department of Labor or the PBGC, nor are there any matters
pending with respect to any DPI Benefit Plan with the Internal
Revenue Service under its Voluntary Compliance Resolution
program, its Closing Agreement Program or similar programs.
(i) There has been no act or acts which would result in a
disallowance of a deduction or the imposition of a tax pursuant
to Code Section 4980B or any predecessor provision of the Code,
or any related regulations. No event has occurred with respect
to which DPI or any of its affiliates could be liable for a tax
imposed by any of Code Sections 4972, 4976, 4977, 4979 or 4980,
or for a civil penalty under Section 502(c) of ERISA.
(j) With respect to each of the DPI Benefit Plans, to the extent
applicable, DPI has delivered to Buyer true and complete copies
of: (i) the plan documents (or, if there is none, a written
summary of the plan's terms and conditions), including any
amendments, related trust agreements, insurance contracts and
other funding arrangements; (ii) the most recent determination
letters received by DPI and any master and prototype plan
sponsor from the Internal Revenue Service; (iii) the three most
recent IRS Form 5500 annual reports, including all schedules and
attachments thereto; (iv) the three most recent actuarial
valuations; (v) the most recent financial statement; (vi) all
correspondence with the Internal Revenue Service, the Department
of Labor and the PBGC with respect to the past three plan years,
other than IRS Form 5500 filings and PBGC premium payments; and
12
(vii) the most recent summary plan description and any summaries
of material modifications not reflected therein (or other
summaries and descriptions furnished to participants and
beneficiaries, if a summary plan description is not required).
Each DPI Benefit Plan can be unilaterally amended, terminated or
otherwise discontinued, in whole or part, by DPI at any time
without liability to DPI. Neither DPI nor any ERISA Affiliate
has any formal plan or commitment, or has communicated to any
current or former employee any intention, whether legally
binding or not, to increase any benefits or create new benefits
under any DPI Benefit Plan or to create any additional Employee
Benefit Plan. Neither DPI nor any ERISA Affiliate maintains or
contributes to a trust, organization or association described in
any of Sections 501(c)(9), 501 (c)(17) or 501 (c)(20) of the
Code.
(k) Neither DPI nor any of its affiliates is a party to any
employment agreement, whether written or oral, or agreement with
change in control or similar provisions, or collective
bargaining agreement or contract with any labor union relating
to any employees or former employees of DPI. The execution,
delivery or performance of this Agreement or the consummation of
the transactions contemplated by this Agreement will not entitle
any individual to severance pay or accelerate the time of
payment or vesting, or increase the amount of any compensation
or benefits due to any individual nor result in the imposition
of any federal excise tax with respect to any CIS Benefit Plan.
All contributions and payments made or accrued with respect to
all DPI Benefit Plans are deductible currently under Code
Section 162 or 404 and no amount payable to an employee or
former employee of DPI will be an "excess parachute payment"
which is non-deductible or subject to tax under Section 280G or
4999 of the Code. DPI nor any of its affiliates has currently
outstanding any loan or loans to any current or former employees
of DPI, nor have DPI or any of its affiliates guaranteed such
loans
(l) Schedule 2.14 of the Disclosure Schedules sets forth, as of the
date of this Agreement, with respect to each employee employed
by DPI, his or her name, position, salary or hourly wage, his or
her date of employment and any applicable significant employee
benefits or entitlement not available generally to DPI's
employees.
(m) DPI has complied in all respects with all applicable laws
relating to the employment of labor or consultants or
independent contractors in connection with the operation of the
Business, including, without limitation, those relating to
wages, hours, collective bargaining, unemployment insurance,
workers' compensation, immigration and naturalization, equal
employment opportunity and the payment and withholding of taxes.
13
(n) DPI is not a party to any contract with any labor organization,
nor has it agreed to recognize any union or other collective
bargaining unit, nor has any union or other collective
bargaining unit been certified as representing any of its
employees. DPI has not experienced any strikes, work stoppages,
significant grievance proceedings or claims of unfair labor
practices filed or, to DPI's or Sellers' knowledge, threatened
to be filed with respect to the operation of the Business.
2.15 Litigation, Proceedings, Etc. Except for matters described in
----------------------------
Schedule 2.15 of the Disclosure Schedules, (i) there is no pending claim,
action, litigation, suit or proceeding against, or investigation of DPI; (ii)
DPI has not received any notice of any claim, action, litigation, suit or
proceeding against it or investigation of it, and no such claim, action, suit,
proceeding or investigation is pending or, to Sellers' knowledge threatened
against DPI, and there are no facts existing which would be a proper basis for
any such claim; and (iii) there are no outstanding court, arbitration or agency
orders, decrees or stipulations to which DPI is a party or which are directed to
DPI.
2.16 Compliance With Law and Other Instruments: Permits. DPI is not
--------------------------------------------------
(and has not been for the past twelve months) in violation of, or default under:
(i) any term or provision of its charter or by-laws; (ii) any term or provision
of any financial covenant or any indenture, mortgage, contract, commitment or
other agreement or instrument to which it is a party, or by which it or any of
its properties or business is or may be bound or affected, or (iii) any
applicable law (including, without limitation, the Fair Labor Standards Act and
all other federal and state wage and hour laws), any and all Federal immigration
laws, regulations and promulgations, rule, regulation, judgment, order or decree
of any governmental agency or court, domestic or foreign, having jurisdiction
over it or any of its properties or business, or DPI's employees, consultants or
independent contractors. DPI owns, possesses, or has obtained licenses,
permits, certifications, registrations, approvals or consents and other
authorizations necessary to own or lease, as the case may be, its business or
operations as presently conducted and all such governmental and other licenses,
permits, certifications, registrations, approvals, consents and other
authorizations are in good standing, and there are no proceedings pending or, to
the best knowledge of DPI's officers and directors, threatened, or any basis
therefor existing, seeking to cancel, terminate or limit such licenses, permits,
certifications, registrations, approvals, or consents or authorizations, or
related to the breach or failure to comply with any law, rule, regulation,
judgment or decree.
2.17 Transactions with Affiliates. Except as set forth in Schedule
----------------------------
2.17 of the Disclosure Schedules, there is no lease, sublease, indebtedness,
contract, agreement, commitment, understanding or other arrangement of any kind
whatsoever entered into by DPI with Sellers, officers or directors or any
Affiliate of any of them. At Closing, DPI shall cancel all arrangements with
any Affiliate.
2.18 Insurance. Set forth in Schedule 2.18 of the Disclosure
---------
Schedules is a list of insurance in force with respect to the Business, which
list is true, complete and accurate in all
14
material respects. DPI has paid all premiums due under such policies and, to its
knowledge, such policies are each outstanding and in full force and effect on
the date hereof. No insurance carrier has refused any application for insurance
by DPI.
2.19 Books and Records. All books and records pertaining to the
-----------------
Business have been, or prior to the Closing shall have been, made available for
review by Buyer and its representatives and are correct and complete in all
material respects, have been maintained in accordance with good business
practice and fairly reflect the basis for the financial condition and results of
operations of DPI set forth in the Financial Statements.
2.20 Powers of Attorney; Bank Accounts. There are no outstanding
---------------------------------
powers of attorney executed on behalf of DPI. Set forth in Schedule 2.20 of the
Disclosure Schedules is an accurate and complete list of the name and address of
each bank or other institution where DPI has an account or safe deposit box, the
number of such account, and the names of all persons authorized to draw thereon
or have access thereto.
2.21 Broker's Fees. DPI has no obligation or liability to pay any
-------------
fees or commissions to any broker, finder, or agent with respect to the
transactions contemplated by this Agreement.
2.22 Miscellaneous. All compensation payments including vacation, per
-------------
diem, holiday and sickness payments, required to be paid to DPI's personnel for
any period prior to the Closing, will be paid in full at the time of Closing.
DPI has not entered into any employment agreement and/or arrangement with
nonexempt personnel guaranteeing a minimum number of work hours during any
predetermined time period. Except as is necessary to close the Business and pay
off obligations, Sellers agree not to use the name Data Performance Inc., or any
similar name for any purpose. All Field Personnel who are classified as
"independent contractors" are correctly classified as such, and all employees
who are non-US citizens have valid, legal and current visas, are in compliance
with applicable United States Immigration Laws, and have properly executed
Employment Eligibility Verification Forms (I-9).
2.23 Year 2000. To the knowledge of the Sellers, all software
---------
owned or licensed by DPI is Year 2000-Compliant. For purpose of this Agreement,
Year 2000-Compliant shall mean:
a) The software includes year 2000 date conversion capabilities,
including without limitation date and century recognition; and
b) The software includes calculations that accommodate same
century/multi-century formulas and date values; and
c) The software will correct sort ordering and date data interface
values that reflect the century and will automatically compensate
for and manage and manipulate data involving dates, including
single-century formulas and multi-century formulas, and not cause
any abnormal event or abort within the application or result in
the generation of incorrect values or invalid outputs involving
such
15
dates.
2.24 Disclosure. The statements contained in this Agreement, and in
----------
all written documents or Schedule attached hereto prepared and delivered by or
on behalf of DPI or Sellers pursuant to the terms hereof are true and correct in
all material respects, and such statements, documents or Schedules do not omit
any material fact required by the terms hereof or thereof to be stated herein or
therein or necessary to make the statements contained herein or therein not
misleading. There is no fact known to Sellers or DPI which would have a material
adverse effect on the Business, other than those which have been set forth in
this Agreement or in the Disclosure Schedules attached hereto.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF BUYER
---------------------------------------
In order to induce Sellers to enter into this Agreement, the Buyer
represents and warrants to the Sellers that the statements contained in this
Article III are correct and complete as of the date of this Agreement and will
be correct and complete as of the Closing Date (as though made then and as
though the Closing Date were substituted for the date of this Agreement through
this Article III).
3.1 Authority Relative to this Agreement. The Buyer has the full
------------------------------------
corporate power and authority, and has taken all necessary and proper action,
corporate and otherwise, to execute, deliver and perform this Agreement and any
other agreement or document contemplated hereby, and to consummate the
transactions contemplated hereby or thereby. All action on the part of Buyer
necessary for the authorization, execution, delivery and performance of this
Agreement and any other agreement or document contemplated hereby, and the
consummation of the transactions contemplated hereby or thereby, has been taken.
The obligations imposed on Buyer by this Agreement, or by any agreement or
document contemplated hereby, constitute the valid and binding obligations and
agreements of Buyer, enforceable against it in accordance with their respective
terms, except that (i) such enforcement may be subject to bankruptcy,
insolvency, reorganization, moratorium or other similar laws now or hereafter in
effect relating to creditors' rights; and (ii) the remedy of specific
performance and injunctive and other forms of equitable relief may be subject to
equitable defenses and to the discretion of the court before which any
proceeding therefor may be brought.
3.2 Compliance of Transaction With Laws and Other Instruments. The
---------------------------------------------------------
execution, delivery and performance by Buyer of this Agreement and any agreement
or document contemplated hereby, and the performance and consummation of the
transactions contemplated hereby or thereby by Buyer (i) do not require on
behalf of Buyer any approval, consent or waiver of, or filing with, any
governmental agency, court or other authority which has not been obtained and
which is not in full force and effect as of the date hereof; (ii) will not
result in a violation of any law, regulation, judgment, writ, injunction, order
or decree of any court or
16
governmental or regulatory authority (federal, local or otherwise) to which
Buyer is subject; (iii) will not conflict with or constitute a breach or
violation of the charter or bylaws of Buyer; and (iv) will not require the
approval, consent or waiver of, or filing with any party to, violate or conflict
with or result in a breach of, or constitute a default or acceleration of or
give rise to a right of termination (or an event which with notice or lapse of
time or both would become a default) under, any provision of any contract,
indenture, mortgage, lease, agreement or other instrument to which Buyer is a
party or to which any of its assets are subject.
3.3 Organization and Qualification. Buyer is a corporation duly
------------------------------
organized, validly existing and in good standing under the laws of its state of
incorporation.
3.4 Consents. Buyer is not subject to any law, ordinance, regulation,
--------
rule, order, judgment, injunction, decree, contract, commitment, lease,
agreement, instrument or other restriction of any kind, which by its provisions
would prevent the consummation of this Agreement or any of the transactions
contemplated hereby, without the consent, filing with or notification of any
third party which has not already been obtained or made or will not be obtained
prior to the Closing.
3.5 Broker's Fees. Buyer has no liability or obligation except to
-------------
Elite Investment Group, LLC, to pay any fees or commissions to any broker,
investment bankers, finder or agent with respect to the transactions
contemplated by this Agreement.
3.6 Status of Stock. Buyer is purchasing the Stock for its own
---------------
account, for investment purposes only, and not with a view to or for sale in
connection with any distribution of such Stock.
3.7 Financial Resources. Subject to Section 4.11, Buyer has adequate
-------------------
resource to complete the transactions as contemplated hereunder.
ARTICLE IV
BUYER'S CONDITIONS TO CLOSING
-----------------------------
The obligations of Buyer to purchase the Stock and to consummate the
transactions contemplated hereby, are subject to the fulfillment in all respects
on or prior to the Closing Date of each of the following conditions:
4.1 Representations and Warranties. The representations and
------------------------------
warranties made by Sellers in Article II hereof shall be true and correct when
----------
made, and shall be true and correct in all material respects on the Closing Date
with the same force and effect as if they had been made on and as of the Closing
Date, except for changes permitted or contemplated by this Agreement and except
that representations which are specifically made as of a specified date shall be
true and correct as of such earlier date.
17
4.2 Performance. All covenants, agreements and conditions contained in
-----------
this Agreement to be performed or complied with by Sellers on or prior to the
Closing Date shall have been performed or complied with in all material
respects.
4.3 Closing Deliveries. Buyer shall have received all documents and
------------------
instruments required pursuant to Section 7.2 hereof.
------------
4.4 Absence of Litigation. No action, suit or proceeding before any court
---------------------
or any governmental body or authority shall be pending against Sellers, DPI, or
Buyer which seeks to impose substantial damages in connection with, or to
restrain or invalidate the transactions contemplated by, this Agreement, and no
preliminary or permanent injunction or order that would prohibit or restrain
such transactions shall be in effect.
4.5 Absence of Certain Changes. There shall not have occurred prior to the
--------------------------
Closing Date (a) any material adverse change in the Business, or any event or
condition which, with the passage of time or the filing of notice, may cause or
create any such adverse change, or (b) the legal inability of Sellers to convey,
assign and transfer to Buyer the Stock.
4.6 Further Assurances. All actions to be taken by the Sellers in
------------------
connection with consummation of the transactions contemplated hereby and all
certificates, opinions, instruments, and other documents required to effect the
transactions contemplated hereby will be satisfactory in form and substance to
the Buyer. The Buyer may waive any condition specified in this Article IV if it
executes a writing so stating at or prior to the Closing Date.
4.7 Miscellaneous. (a) Advani shall have executed and delivered to Buyer
-------------
the employment agreement attached hereto, (b) Sellers shall have delivered to
Buyer, from or with respect to the State of Illinois, a good standing
certificate, a broad form general liability certificate, a letter of clearance
from the Illinois Department of Employment Security, a xxxxxxx'x compensation
certificate, and a tax clearance certificate , (c) Buyer shall have received an
opinion from Counsel for Sellers, dated the Closing Date, satisfactory in form
and substance to counsel for Buyer and (d) Buyer shall have received the
Articles of Incorporation and the By-Laws of DPI as amended to the date hereof,
and a certification by an officer of DPI that same are true and complete copies
of such documents as in effect at the time of certification.
4.8 Excluded Liabilities. Sellers shall have provided Buyer with evidence
--------------------
of payment or satisfaction of all Excluded Liabilities.
4.9 Excluded Assets. Sellers shall have provided Buyer with evidence of
---------------
transfer of all Excluded Assets out of DPI.
4.10 GE Approval. General Electric Capital Corporation ("GE Capital")
-----------
shall have approved of the consummation of the transactions contemplated by this
Agreement.
18
4.11 401(k) and SEP Plans. Without any liability to Buyer or DPI, DPI and
--------------------
the Sellers will take all steps necessary or appropriate to terminate all of
DPI's retirement plans and arrangements that comply or are intended to comply
with Code Section 401(k), 408(k) and 408(p) prior to the Closing, including the
Data Performance, Inc. 401(k) Plan, the Data Performance, Inc. SEP, and the Data
Performance, Inc. SAR-SEP, and take all other necessary or appropriate actions
to ensure that distributions can be made from the Data Performance, Inc. 401(k)
Plan to its participants and beneficiaries within a reasonable period after its
termination.
ARTICLE V
SELLERS' CONDITIONS TO CLOSING
------------------------------
The obligations of Sellers to sell the Stock and the obligation of Sellers
to consummate the transactions contemplated hereby are subject to the
fulfillment in all respects on or prior to the Closing of each of the following
conditions:
5.1 Representations and Warranties. The representations and warranties
------------------------------
made by Buyer in Article III hereof shall be true and correct when made, and
-----------
shall be true and correct in all respects on the Closing with the same force and
effect as if they had been made on and as of the Closing, except for changes
permitted or contemplated by this Agreement and except that representations
which are specifically made as of a specified date shall be true and correct as
of such earlier date.
5.2 Performance. All covenants, agreements and conditions contained in
-----------
this Agreement to be performed or complied with by Buyer on or prior to the
Closing shall have been performed or complied with in all respects.
5.3 Closing Deliveries. Sellers shall have received all documents and
------------------
instruments required pursuant to Section 7.2 hereof.
------------
5.4 Absence of Litigation. No action, suit or proceeding before any court
---------------------
or any governmental body or authority shall be pending against Sellers, DPI, or
Buyer which seeks to impose substantial damages in connection with, or to
restrain or invalidate the transactions contemplated by this Agreement and no
preliminary or permanent injunction or order that would prohibit or restrain
such transactions shall be in effect.
ARTICLE VI
FURTHER AGREEMENTS
------------------
6.1 Expenses. Sellers shall pay their costs incurred in connection with
--------
the preparation, negotiation, execution and delivery of this Agreement and the
consummation of the transactions
19
contemplated hereby including, without limitation, the fees of the attorneys and
accountants of Sellers. Buyer shall pay its costs incurred in connection with
the preparation, negotiation, execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby including, without
limitation, the fees of its attorneys and accountants.
6.2 Press Releases. Buyer may prepare and issue press releases regarding
--------------
this transaction, but will provide advance notice to Sellers thereof.
6.3 Survival of Representations. The representations and warranties
---------------------------
contained herein are and will be deemed and construed to be continuing
representations and warranties and will survive the Closing and (other than the
representations and Warranties set forth in Sections 2.9 and 2.14 and fraudulent
misrepresentations made by Sellers) continue in full force and effect
thereafter, provided that a notice is given as to a breach of such
representations or warranties within three years of the Closing Date. The
representations and warranties set forth in Sections 2.9 and 2.14 and all
fraudulent misrepresentations made by Sellers shall continue in full force and
effect at all times thereafter until expiration of the applicable statute of
limitations. If a notice of breach is given within the applicable time period,
the Individual Sellers shall, jointly and severally, be responsible for all
Damages (as defined below) resulting from, arising out of, or related to such
breach, including all Damages suffered after the date notice has been given.
6.4 Indemnification.
---------------
(a) From and after the Closing Date, the Individual Sellers shall,
jointly and severally, defend, indemnify and hold harmless Buyer from and
against any and all claims, actions, causes of action, lawsuits, actual losses,
costs, actual damages, actual liabilities and expenses, including reasonable
attorneys' fees and expenses (collectively, "Damages"), incurred by Buyer that
arise out of:
(i) a breach of the representations, warranties, covenants and
agreements given or made by Sellers in this Agreement, any of the Disclosure
Schedules or under or pursuant to any document, certificate, schedule or
instrument delivered by or on behalf of Sellers in connection herewith;
(ii) all matters arising out of or in connection with the
operation of the Business before the Closing including, without limitation, all
services provided by the Business prior to the Closing Date and including,
without limitation, all matters referred to in Section 2.23 hereof;
(iii) all Excluded DPI Liabilities and Excluded DPI Assets; and
(iv) any claim, action, suit or proceeding asserted or instituted
on the basis of any matter described in clauses (i), (ii), or (iii) of this
paragraph (a) of Section 6.4.
20
(b) From and after the Closing Date, Buyer shall defend, indemnify and hold
harmless Sellers from and against any and all Damages incurred by Sellers
arising out of (i) a breach of the representations, warranties, covenants and
agreements given or made by Buyer in this Agreement, any of the Disclosure
Schedules, or under or pursuant to any document, certificate, schedule or
instrument delivered by or on behalf of Buyer in connection herewith; (ii) all
matters arising solely out of or solely in connection with the operation of the
Business after the Closing, and (iii) any claim, action, suit or proceeding
asserted or instituted on the basis of any matter described in clauses (i) or
(ii) of this Section 7.4(b).
(c) Limitations. Notwithstanding the foregoing,
-----------
(i) Sellers shall have no obligation to indemnify the Buyer from and
against any Damages resulting from, arising out of, or relating to or caused by
the breach of any representation, warranty, indemnity or covenant under, or
arising in connection with this Agreement, until the Buyer has suffered Damages
by reason of all such breaches in excess of $25,000 (after which point the
Individual Sellers will be obligated, subject to paragraph (ii) below, to
indemnify Buyer from all Damages, including Damages not in excess of $25,000);
(ii) In no event shall the amount of liability of Individual Sellers
to Buyer for breach of any representation, warranty, indemnity or covenant or
otherwise under, or arising in connection with, this Agreement exceed an amount
equal to 94.9% of the sum of the Unadjusted Purchase Price; and
(iii) All Damages to which any party would otherwise be entitled to
indemnification under this Agreement shall be determined net of any: (a) tax
benefit or economic benefit to such party arising in respect of or as a result
of the matters for which the indemnification is claimed and (b) insurance
proceeds derived (or reasonably expected to be derived) by such party in respect
thereof; and
(iv) In addition to the limitation set forth in paragraphs (i), (ii)
and (iii), Sellers' obligation to indemnify the Buyer from and against any
Damages resulting from, arising out of, related to or caused by the breach of
the representation and warranty set forth in paragraph 2.14(m) shall not exceed
the amount of Damages arising out of, related to, or caused by such breach prior
to the Closing.
6.5 Procedures; Third Party Claims. If a claim to which the
------------------------------
indemnification provisions of Section 6.4 apply, arises out of any suit, claim
------------
or other assertion of liability by a third party (hereinafter collectively, the
"Claims" and individually, a "Claim"), the indemnified party agrees to give
written notice within a reasonable time to the indemnifying party of the
existence of such Claim, it being understood that the failure to give such
notice shall not affect the indemnified party's right to indemnification and the
indemnifying party's obligation to indemnify as set forth in this Agreement,
unless the indemnifying party's ability to contest, defend or settle with
respect to such Claim is thereby demonstrated and materially prejudiced.
21
The obligations and liabilities of the parties hereto with respect to their
respective indemnities pursuant to Section 6.4 resulting from any Claim, shall
------------
be subject to the following additional terms and conditions:
(a) The indemnifying party shall have the right to undertake, by
counsel or other representatives of its own choosing, the defense
or opposition to such Claim, subject to the right of approval by
indemnified party, which right shall not be unreasonably withheld.
(b) In the event that the indemnifying party shall elect not to
undertake such defense or opposition, or within 30 days after
notice of any such Claim from the indemnified party shall fail to
defend or oppose, the indemnified party (upon further written
notice to the indemnifying party) shall have the right to
undertake the defense, opposition, compromise or settlement of
such Claim, by counsel or other representatives of its own
choosing, on behalf of and for the account and risk of the
indemnifying party (subject to the right of the indemnifying party
to assume the defense of or opposition to such Claim at any time
prior to settlement, compromise or final determination thereof).
(c) Anything in this Section 6.5 to the contrary notwithstanding, (i)
------------
if there is a reasonable probability that a Claim may adversely
affect the indemnified party, (x) the indemnified party shall have
the right, at its own cost and expense, either through its own
counsel or through counsel of the indemnifying party, to
participate in the defense, opposition, compromise or settlement
of the Claim, and (y) if the indemnified party elects to
participate in the defense through counsel of the indemnifying
party, each party shall bear its share of all legal costs and
expenses incurred by counsel for the indemnifying party in the
proportion by which its share of the total Claim bears to the
total Claim, (ii) the indemnifying party shall not, without the
indemnified party's written consent, settle or compromise any
Claim or consent to entry of any judgment which does not include
as an unconditional term thereof the giving by the claimant or the
plaintiff to the indemnified party of a release from all liability
in respect of such Claim, and (iii) in the event that the
indemnifying party undertakes defense of or opposition to any
Claim, the indemnified party, by counsel or other representative
of its own choosing and at its sole cost and expense, shall have
the right to consult with the indemnifying party and its counsel
or other representatives concerning such Claim and the
indemnifying party and the indemnified party and their respective
counsel or other representatives shall cooperate in good faith
with respect to such Claim.
22
(d) No undertaking of defense or opposition to a Claim shall be
construed as an acknowledgment by such party that it is liable to
the party claiming indemnification with respect to the Claim at
issue or other similar Claims.
6.6 Claims Against Escrow Account. In the event the indemnifying party is
-----------------------------
required to make any payments under Section 6.4 hereof, or in the event the
indemnifying party is required to reimburse the indemnified party pursuant to
Section 6.4 hereof, the indemnified party must first, to the extent of any funds
remaining in the Escrow Account, make a claim against the Escrow Account,
whereupon the parties may agree that the matter shall be referred to binding
arbitration or be determined by a court of competent jurisdiction.
6.7 Conduct of Business Pending Closing.
-----------------------------------
(a) Except as set forth in the Disclosure Schedules, during the period
from the date of this Agreement to the date of Closing (the "Closing Date"), DPI
shall conduct the Business according to its ordinary and usual course of
business, consistent with past practice. Without limiting the generality of the
foregoing, prior to the Closing Date, DPI will not, without the prior written
consent of Buyer, engage in any of the following transactions:
(i) enter into any new employment agreement with officers,
directors or employees;
(ii) grant any increase in the compensation payable or to become
payable to the Individual Sellers or any other officers or employees or
establish, adopt, enter into, or make any new grants or awards under, accelerate
payment or vesting, become obligated to grant any awards under, or amend any
collective bargaining, bonus, profit sharing, thrift, compensation, stock option
or other equity, pension, retirement, incentive or deferred compensation,
employment, retention, termination, severance, health, life or other welfare,
fringe, Employee Benefit Plan, or other plan, agreement, trust, fund, policy or
arrangement for the benefit of any current or former directors, officers or
employees, or grant or pay any benefit not required by an existing Employee
Benefit Plan or other plan or arrangement.
(iii) make a commitment for any significant investment of a
capital nature;
(iv) enter into any waiver, release or relinquishment of any
contract rights, except, in each case, in the ordinary course of business and
consistent with past practice;
(v) enter into any new leases for property except in the
ordinary course of business, or terminate any of the Client Agreements;
(vi) acquire the assets of any business or any corporation,
partnership or other business organization or otherwise acquire any assets which
are material in the aggregate to the Business;
23
(vii) sell, lease or otherwise dispose of any Asset except in
the ordinary course of business consistent with past practice;
(viii) create, assume or incur any encumbrance on any of the
Assets;
(ix) amend, terminate or waive any right of substantial value
arising under any of the Client Agreements or otherwise relating to the
Business;
(x) fail to pay current liabilities, including accounts
payable and accrued expenses, in the ordinary course of business and otherwise
in accordance with their terms;
(xi) collect any accounts receivable outside of the ordinary
course and in advance of their due dates;
(xii) take or perform any action which would or might cause any
representation or warranty made by Sellers herein to be rendered inaccurate, in
whole or in part, and/or which would prevent, inhibit or preclude the
satisfaction, in whole or in part, of any covenant required to be performed or
satisfied by Sellers at or prior to the Closing and/or the implementation of the
within transaction;
(xiii) agree in writing or otherwise take any of the foregoing
actions or any action which would make any representation or warranty in this
Agreement to be untrue or incorrect; or
(xiv) otherwise engage in any practice, take any action, or
enter into any transaction of the sort described in Section 2.10 above.
(b) During the period from the date of this Agreement to the Closing
Date, Individual Sellers will:
(i) take and perform any and all actions necessary to render
accurate and/or maintain the accuracy of, all of the representations and
warranties of Individual Sellers and DPI herein contained and satisfy each
covenant or condition required to be performed or satisfied by Sellers prior to
the Closing and/or cause or permit the implementation of the within transaction;
(ii) carry on and maintain the Business in substantially the
same form, style and manner as operated by Sellers prior to this Agreement and
use their best efforts to preserve DPI's business organization and its
relationships with its customers, all employees and others having business
relations with DPI, and not voluntarily engage in any transaction not in the
ordinary course of business without the prior consent of Buyer;
24
(iii) use their best efforts in good faith to cause each of DPI's
customers including, but not limited to those listed on Schedule 1.2(e) of the
Disclosure Schedules, to indicate their intention to continue to be bound by the
terms and conditions of the Client Agreements;
(iv) use their best efforts in good faith to cause each of DPI's
employees to continue employment with DPI following the Closing Date; and
(v) give prompt written notice to Buyer of any material
development affecting DPI's, clients, liabilities, business, financial
condition, operations, results of operations, or future prospects; and give
prompt written notice to Buyer of any material development affecting Sellers'
ability to consummate the transactions contemplated by this Agreement. No
disclosure, pursuant to this paragraph "6.7 (b)(v)", however, shall cure any
misrepresentation, breach of warranty, or breach of covenant.
6.8 Continued Disclosure. If any event or state of facts occurs or arises
--------------------
between the earlier of the date hereof (or the date as of which disclosure has
been made with respect to such type of event or state of facts) and the Closing
Date that, had it occurred or arisen prior to or on such date, would have been
required by the terms hereof to be disclosed herein, Sellers shall give notice
thereof in writing to Buyer within five days of the happening of such event or
state of facts. The giving of such notice and the disclosure of such event or
state of facts shall in no way change the conditions precedent to the
obligations of Buyer as set forth in Article IV.
----------
6.9 Full Access. Sellers will permit representatives of the Buyer to have
-----------
full access to all premises, properties, personnel, books, records, contracts
and documents of or pertaining to DPI.
6.10 Exclusivity. DPI will not and Sellers will not cause or permit DPI to:
-----------
(i) solicit, initiate, or encourage the submission of any proposal or offer from
any person or entity relating to the acquisition of any capital stock or other
voting securities, or any substantial portion of the assets of, DPI (including
any acquisition structured as a merger, consolidation, or share exchange) or
(ii) participate in any discussions or negotiations regarding, furnish any
information with respect to, assist or participate in, or facilitate in any
other manner any effort or attempt by any person or entity to do or seek any of
the foregoing. The Sellers will not vote the Stock in favor of any such
acquisition structured as a merger, consolidation, or share exchange. The
Sellers will notify the Buyer immediately if any person or entity makes any
proposal, offer, inquiry, or contact with respect to any of the foregoing.
6.11 Tax Returns. Sellers will provide to Buyer, within 45 days following
-----------
the Closing Date, draft federal and state tax returns and draft cash basis
financial statements for DPI covering, in each instance, the period from January
1, 1998 to the Closing Date.
25
ARTICLE VII
CLOSING DELIVERIES
------------------
7.1 Closing. Subject to the conditions contained in this Agreement, the
-------
closing of the transactions contemplated by this Agreement (the "Closing") shall
take place at a location mutually agreeable to Buyer and Sellers at 10:00 a.m.
Central Daylight Time on June 29, 1998. The effective time for purposes of
apportionments and other matters involving allocations for the Closing shall be
12:01 a.m., Central Daylight Time, on June 29, 1998.
7.2 Deliveries.
----------
(a) At the Closing, Buyer shall deliver to Sellers:
(i) $9,550,000 of the Unadjusted Purchase Price pursuant to
Section 1.4 hereof;
-----------
(ii) Certified copies of the resolutions of the Board of
Directors of Buyer authorizing Buyer to execute and deliver this Agreement, any
agreement or document contemplated hereby, and to consummate the transactions
contemplated hereby and thereby;
(iii) A certificate of an executive officer of Buyer, dated the
Closing Date, certifying that: (A) all representations and warranties made by
Buyer in Article III hereof were true and correct when made, and are true and
correct on the Closing Date, except for changes permitted or contemplated by
this Agreement and except that representations which are specifically made as of
a specified date shall be true and correct as of such earlier date; and (B) all
covenants, agreements and conditions contained in this Agreement to be performed
or complied with by Buyer on or prior to the Closing Date have been performed or
complied with;
(iv) A duly executed Escrow Agreement, in substantially the form
as attached as Exhibit A hereto;
(v) A duly executed Employment Agreement, in substantially the
form attached as Exhibit B-1 hereto; and
(vi) Opinion of Buyer's counsel.
(b) At the Closing, Buyer shall deliver to the Escrow Agent $750,000
of the Unadjusted Purchase Price.
(c) At the Closing, Sellers shall deliver to Buyer:
(i) Certificates for the Stock accompanied by executed assignment
documents or endorsed in blank;
26
(ii) Possession of all assets used in the Business, except for
Excluded Assets;
(iii) All contracts, leases, agreements or other documents,
books, financial and accounting records of DPI not previously delivered or not
located on the premises of DPI, to the extent such items are used in the
Business, and are not Excluded Assets;
(iv) A duly executed Escrow Agreement, in substantially the
form attached as Exhibit A hereto;
(v) A duly executed Employment Agreement, in substantially the
form attached as Exhibit B-1 hereto;
(vi) A certificate of the Individual Sellers, dated as of the
Closing Date, certifying that: (i) all representations and warranties made by
Individual Sellers in Article II hereof were true and correct when made, and are
true and correct on the Closing Date except for changes permitted or
contemplated by this Agreement and except that representations which are
specifically made as of a specified date shall be true and correct as of such
earlier date; and (ii) all covenants, agreements and conditions contained in
this Agreement to be performed or complied with by Individual Sellers on or
prior to the Closing Date have been performed or complied with;
(vii) An opinion of Sellers' counsel in a form to be mutually
agreed by the parties ;
(viii) All documents required by Article IV hereof; and
(ix) All other documents required by this Agreement.
ARTICLE VIII
POST-CLOSING COVENANTS AND AGREEMENTS
-------------------------------------
8.1 Further Assurances. If at any time and from time to time after the
------------------
Closing, Buyer determines that any further assignment, consent to assignment or
other document or any further action is necessary or desirable to carry out the
purposes of and to make effective the transactions contemplated by this
Agreement, Sellers agree to execute and deliver all such instruments and to take
such actions as may be reasonably necessary or advisable for such purpose.
8.2 Covenant Not to Compete; Nondisclosure and Confidentiality.
----------------------------------------------------------
(a) Non-Compete. For a period of five (5) years from the date of this
27
Agreement, Individual Sellers shall not directly or indirectly through
representatives, agents or otherwise (i) engage in competition with the Business
sold hereunder, its successors or assigns within 150 miles from Rolling Meadows,
Illinois, (hereafter the "Territory") or with respect to DPI's or Buyer's
"customers" as defined in this paragraph; or (ii) provide information, solicit
or sell for, own, or organize any interest in, either directly or through any
affiliate or subsidiary corporation, partnership or other entity, or become
engaged by, act as agent for, or in any manner assist, any person, corporation
or other entity that is directly or indirectly in competition with Buyer or the
Business, or their successors or assigns in the Territory or with respect to
Buyer's or DPI's "customers" as defined in this paragraph. Individual Sellers
further agree that within the restrictive period, they will not in any way
attempt to divert from Buyer or DPI any business whatsoever and Individual
Sellers further agree that during said restrictive period they will not
influence or attempt to influence any of the customers of Buyer or Sellers not
to do business with Buyer or DPI; Individual Sellers further agree that they
will not make or permit the making of any public announcement or statement of
any kind that they were formerly employed or connected with Buyer or DPI, which
announcement has as its purpose directly or indirectly the intent to violate the
provisions of this Agreement. The term "customer", as used herein, shall mean
any person or entity which either Individual Seller has contact with and does
business with for Buyer or DPI at any time while employed by DPI or Buyer.
(b) Confidential Information. During the term set forth in paragraph (a)
and thereafter, Individual Sellers shall not divulge any of Buyer's or DPI's
business contacts, customers, suppliers, technology, know-how, trade secrets,
marketing techniques, books and records, computer programs, lists, plans,
databases, or any other confidential or proprietary information or make
available to any other persons any documents, files or other papers concerning
the foregoing or the Business or financial affairs of DPI or Buyer. During the
term set forth in paragraph (a) Individual Sellers shall not solicit the
employment of any employee or consultant currently or provisionally employed or
retained by Buyer or DPI.
(c) Individual Sellers have carefully considered the nature and extent of
the restrictions upon them and the rights and remedies conferred upon Buyer
under this Agreement and hereby acknowledge and agree that the same are
reasonable in time and territory.
(d) It is stipulated that a breach by Sellers of the restrictive covenants
set forth herein will cause irreparable damage to Buyer and that in the event of
any breach of the provisions under this Section, Buyer, in addition to any other
remedies it has, shall be entitled to an injunction restraining Sellers from
violating or continuing a violation of the restrictive covenants herein
contained. It is further stipulated that the existence of any claim or cause of
action on the part of Sellers against Buyer, whether arising from this Agreement
or otherwise shall in no way constitute a defense to the enforcement of the
restrictive covenants contained herein, and the restrictive periods in which
Buyer is entitled to an injunction shall be extended in an amount which equals
the time period which the Sellers are or have been in violation of the
restrictive covenants contained herein. In the event of a breach of the
restrictive covenants contained in the Agreement, Sellers agree to the payment
of or reimbursement of Buyer's reasonable attorney's fees and disbursements
incurred in enforcing any such provision. The provisions of this Section
28
shall survive the Closing Date. If any of the provisions of this Section shall
be held invalid, illegal, or unenforceable by the final decision of a court of
competent jurisdiction and all appeals therefrom shall have failed or the time
for such appeals shall have expired the provision or provisions shall be deemed
eliminated from this Agreement in such jurisdiction but the remaining provisions
shall nevertheless be given full effect. In the event this Agreement or any
portion hereof is more restrictive than permitted by the law of the jurisdiction
in which enforcement is sought, this Agreement or such portion shall be limited
in that jurisdiction only to the extent required by the law of that
jurisdiction. If a court of competent jurisdiction shall determine that the
terms of this Section are partially or wholly inoperative, unenforceable or
invalid in a particular case because of their time or geographic scope or for
any other reason such court shall have the power to limit such time or
geographic scope or otherwise to recast the terms of this Agreement in such case
so as to permit its enforcement to the greatest extent permitted by applicable
law.
8.3 Resignations; Bank Authorizations. Immediately following Closing, P.
---------------------------------
Advani and the other directors and officers of DPI shall resign as such
directors and officers of DPI. Immediately following Closing, Sellers shall
take all actions required to change the authorized signatories on all DPI bank
accounts to those persons designated by Buyer.
ARTICLE IX
TERMINATION; WAIVER
-------------------
9.1 Termination. This Agreement may be terminated at any time prior to the
-----------
Closing as follows:
(a) the Buyer and the Sellers may terminate this Agreement by mutual
written consent at any time prior to the Closing;
(b) the Buyer may terminate this Agreement by giving written notice to
the Sellers' Representative at any time prior to the Closing (i) in the event
any Seller has breached any representation, warranty, or covenant contained in
this Agreement in any material respect, the Buyer has notified the Sellers'
Representative of breach, and the breach has continued without cure for a period
of 10 days after the notice of breach, or (ii) if the Closing shall not have
occurred on or before July 31, 1998, by reason of Sellers being unable or
unwilling to effect a Closing on or before, July 31, 1998, or by reason of the
failure of any condition precedent under Article IV hereof (unless the failure
results primarily from the Buyer itself breaching any representation, warranty,
or covenant contained in this Agreement); and
(c) the Sellers may terminate this Agreement by giving written notice
to the Buyer at any time prior to the Closing (i) in the event the Buyer has
breached any representation, warranty, or covenant contained in this Agreement
in any material respect, the Sellers have notified the Buyer of the breach, and
the breach has continued without cure for a period of 10
29
days after the notice of breach, or (ii) if the Closing shall not have occurred
on or before July 31, 1998, by reason of Buyer being unable or unwilling to
effect a Closing on or before July 31, 1998, or by reason of the failure of any
condition precedent under Article V hereof (unless the failure results primarily
from the Sellers themselves breaching any representation, warranty, or covenant
contained in this Agreement).
9.2 Effect of Termination; Specific Performance.
-------------------------------------------
(a) In the event of the termination of this Agreement pursuant to
Section 9.1 hereof, notice thereof shall be promptly given by the terminating
party to the other party and thereafter this Agreement shall forthwith become
void and have no effect, without any liability on the part of any party or its
directors, officers or stockholders, except that (i) the provisions of Section
6.1 hereof shall remain in effect and (ii) nothing in this Section 9.2 shall
relieve any party to this Agreement from liability for breach of this Agreement
or any misrepresentation hereof, including pursuant to paragraph (b) hereof.
(b) In the event of a breach or threatened breach by Sellers or Buyer
of any of the agreements and obligations set forth herein, monetary damages or
the other remedies at law that may be available to the non-breaching party for
such breach or threatened breach will be inadequate and, without prejudice to
the nonbreaching party's right to pursue any remedies at law or in equity
available to it for such breach or threatened breach, including without
limitation the recovery of damages, the non-breaching party will be entitled to
injunctive relief as a means of having the breaching party comply with the
provisions herein.
9.3 Extension; Waiver. At any time prior to the Closing, the parties
-----------------
hereto may (i) extend the time for the performance of any of the obligations or
other acts of the other party hereto, (ii) waive any inaccuracies in the
representations and warranties contained herein by the other party or in any
document, certificate or writing delivered pursuant hereto by the other party,
or (iii) waive compliance with any of the agreements or conditions contained
herein. Any agreement on the part of either party to any such extension or
waiver shall be valid only if set forth in an instrument in writing signed on
behalf of such party. No waiver of any breach of a provision of this Agreement
shall constitute or be deemed a waiver of any other breach of the same or any
other provision of this Agreement, and no delay or failure to take action with
respect to any breach or provision of this Agreement shall constitute or be
deemed a waiver of the right to enforce this Agreement and to take action
against such breach or any subsequent breach of the same or any other provision.
ARTICLE X
MISCELLANEOUS PROVISIONS
------------------------
10.1 Entire Agreement; Amendment. Except with respect to those documents
---------------------------
signed in connection with the Closing of the transactions contemplated by this
Agreement and those
30
documents that, by their terms, modify or supersede this Agreement, this
Agreement (including the Disclosure Schedules), contains the entire agreement
between the parties hereto and supersedes all prior oral or written agreements,
promises, representations, commitments or understandings with respect to the
matters provided for herein. This Agreement may be modified or amended only by a
writing duly executed by Buyer and Sellers, which modification or amendment
shall be binding upon all of the parties hereto.
10.2 Assignment and Binding Effect. This Agreement and the rights and
-----------------------------
obligations of any party hereunder may not be assigned by any party without the
prior written consent of the other party hereto. All covenants, agreements,
statements, representations, warranties and indemnities in this Agreement by and
on behalf of either of the parties hereto shall bind and inure to the benefit of
their respective heirs, successors and permitted assigns of the parties hereto.
10.3 Waivers. No waiver of any of the provisions of this Agreement shall be
-------
deemed or shall constitute a continuing waiver, and no waiver shall be binding
unless executed in writing by the party making the waiver.
10.4 Notices. All notices, demands or other communications which may be or
-------
are required to be given by any party to any other party pursuant to this
Agreement, shall be in writing and shall be mailed by certified mail, return
receipt requested, postage prepaid, or transmitted by hand delivery, national
overnight express, telegram or facsimile transmission, addressed as follows:
(a) If to Buyer:
Xxxxxx Telecom, Inc.
000 Xxxxxx Xxxxxx
Xxxxxxxx, Xxx Xxxxxx 00000
Attention: Xxxxxxx X. Xxxxxxxxxx
Xx. Vice President-Finance
Facsimile: (000) 000-0000
with a copy (which shall not constitute notice) to:
XxXxxxx, XxXxxxx & Xxxxx
00 Xxxxx Xxxxxx Xxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxx X. Xxxxx
Facsimile: (000) 000-0000
31
(b) If to Sellers:
Xxxx Xxxxxx
000 X. Xxx Xxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Xxxxxx Xxxxxx
000 Xxx Xxxxx Xxxx
Xxxxxxxxxx, Xxxxxxxx 00000
with a copy to:
Childress & Xxxx, Ltd.
0 X. Xxxxxxx Xxxxxx, 0xx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxx Xxxxx Xxxxxxxx
until such time as either party notifies the other of a change of address. Each
notice or other communication which shall be mailed, delivered or transmitted in
the manner described above shall be deemed sufficiently given and received for
all purposes at such time as it is delivered to the addressee (with the return
receipt, the delivery receipt, or the affidavit of messenger or telefax
transmission log being deemed conclusive evidence of such delivery) or at such
time as delivery is refused by the addressee upon presentation.
10.5 Governing Law; Jurisdiction and Venue. This Agreement shall be
-------------------------------------
governed by and construed in accordance with the laws of the State of Illinois,
without giving effect to the principles of conflicts of laws thereof. Each party
hereby submits to the personal jurisdiction of the United States District Court
for the Northern District of Illinois or any court of the State of Illinois, and
hereby irrevocably and unconditionally agrees that all claims in respect of any
such action or proceeding may be heard and determined in such court. In
addition, each party hereby irrevocably and unconditionally waives, to the
fullest extent permitted by law, (i) any objection which it may now have or
hereafter have to the laying of venue of any suit, action or proceeding arising
out of or relating to this Agreement or any related matter in such court, (ii)
the defense of an inconvenient forum to the maintenance of any suit, action or
proceeding in any such court, and (iii) trial by jury in any such suit, action
or proceeding.
10.6 Counterparts; Execution. To facilitate execution, this Agreement may
-----------------------
be executed in as many counterparts as may be required, and each such
counterpart hereof shall be deemed to be an original instrument, but all such
counterparts together shall constitute but a single agreement.
10.7 Severability. Any provision of this Agreement which is prohibited or
------------
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of
32
such prohibition or unenforceability without invalidating the remaining
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
10.8 No Third Parties Benefited. This Agreement is made and entered into
--------------------------
for the sole protection and benefit of the parties hereto, their successors and
assigns, and no other person or persons shall have any right of action under
this Agreement.
10.9 Recitals, Schedules and Exhibits. The recitals, schedules, and
--------------------------------
exhibits to this Agreement are incorporated herein and, by this reference, made
a part hereof as if fully set forth at length herein.
10.10 Section Headings. The section headings used herein are inserted for
----------------
reference purposes only and shall not in any way affect the meaning or
interpretation of this Agreement.
33
IN WITNESS WHEREOF, each of the parties hereto has executed this Agreement,
or caused this Agreement to be executed on its behalf, as of the date first
above written.
BUYER:
XXXXXX TELECOM, INC.
By:________________________________
Its:_______________________________
SELLERS:
-----------------------------------
Xxxx Xxxxxx
-----------------------------------
Xxxxxx X. Xxxxxx
Xxxx Xxxxxx 1997
Charitable Remainder Trust
By: _______________________________
Trustee
As Guarantor of the Payment set forth in Section
1.4(a)
XXXXXX INTERNATIONAL, INC.
By: _______________________________
Its: _______________________________
