EXHIBIT 2.2
THIS AGREEMENT is made on October 1999
BETWEEN:
(1) THE SEVERAL PERSONS whose respective names and addresses are set out in
column (1) of Schedule 1 (the "Vendors"); and
(2) XXXXX.XXX, INC (a Delaware corporation) whose address is 000 Xxxxxxxxxx
Xxxxx, Xxxxxxx Xxxx, Xxxxxxxxxx 00000 XXX (the "Purchaser").
WHEREAS:
(A) The Purchaser has entered into an agreement, dated 11 October 1999, ("Sale
and Purchase Agreement") with the Vendors to purchase the entire issued
share capital of Apion Telecoms Limited, a company registered in Northern
Ireland with number NI 36497 (the "Company") in reliance (inter alia) upon
the representations, warranties and undertakings in the Sale and Purchase
Agreement for the consideration and otherwise upon and subject to the terms
and conditions of the Sale and Purchase Agreement.
(B) The Vendors and the Purchaser have agreed to enter into this Supplemental
Agreement to supplement and amend the terms and conditions of the Sale and
Purchase Agreement as set out below.
WHEREBY IT IS AGREED as follows:
1. DEFINITIONS AND INTERPRETATION
1.1 In this Supplemental Agreement defined words and expressions have the
meanings set out in the Sale and Purchase Agreement.
2. SHARES REGISTERED IN NAME OF VENDOR AFTER COMPLETION
2.1 Each of the Vendors hereby declares that for so long as it remains the
registered holder of any of the Shares or any shares of any class of the
Subsidiaries ("Subsidiary Shares"), including without limitation, 2 shares
in ATL held by Xxxxxxxx Xxxxx and Xxxxxxx Xxxxxx on trust for the A
Shareholders of the Company after Completion it will:
(a) hold the Shares and the Subsidiary Shares and their
dividends and other distributions of profits or surplus or other
assets declared, paid or made in respect of them after Completion and
all rights arising out of or in connection with them in trust for the
Purchaser and its successors in title; and
(b) deal with and dispose of the Shares and Subsidiary Shares
and all such dividends, distributions and rights are described in
Clause 2.1(a) as the Purchaser or any such successor may direct.
2.2 (a) Each of the Vendors hereby irrevocably appoints the Purchaser as
its lawful agent and proxy for the purpose of receiving notices of and
attending and
1
voting at all meetings of the members of the Company from Completion
to the day on which the Purchaser or its nominee is entered in the
register of members of the Company as the holder of the Shares and
Subsidiary Shares.
(b) For such purpose the Vendors hereby authorise:
(i) the Company to send any notices in respect of their
holdings of Shares to the Purchaser; and
(ii) the Purchaser to complete in such manner as it thinks
fit and to return proxy cards, consents to short notice and any
other document required to be signed by him in his capacity as a
member.
2.3 The rights of the Purchaser pursuant to Clauses 2.1 and 2.2 shall
cease on the registration of the Shares and Subsidiary Shares in the
Purchaser's name.
3. SUPPLEMENT TO CLAUSE 11 OF THE SALE AND PURCHASE AGREEMENT
3.1 Clause 11 of the Sale and Purchase Agreement shall be amended by
the insertion of the following Clause 11.1.7:
"11.1.7 any breach of Warranty 2.4 set forth in Schedule 6 of this
Agreement."
4. ACKNOWLEDGEMENT
4.1 The parties acknowledge that no Schedule 2 to the Sale and Purchase
Agreement was ever agreed between the parties and, accordingly, Schedule 2
and all references in the Sale and Purchase Agreement to "Participants", "A
Participants" and "B Participants" shall be of no effect.
5. AMENDMENT TO PARAGRAPH 6 OF SCHEDULE 15 OF THE SALE AND PURCHASE AGREEMENT
5.1 Paragraph 6 of Schedule 15 of the Sale and Purchase Agreement shall be
amended by the deletion of the existing Paragraph 6 and the insertion of
the following new Paragraphs 6:
"6.1 (Pounds)700,000 upon adjudication by the Inland Revenue of the share
transfers in relation to the acquisition by the Company of the share
capital of AL;
6.2 (Pounds)700,000 upon the Revenue Commissioners being satisfied as to
any capital duty payable in relation to the subscription by the
Company for share capital of AL;
6.3 (Pounds)190,000 upon the earliest to occur of: (a) the second
anniversary of the lodgement of the Irish corporation tax return by
the Company for the 99/00 tax year which has not been challenged by
the Revenue Commissioners; (b) 31 December, 2002 provided that by
such date the corporation tax return of the Company for the 99/00
tax year has not been challenged by the Revenue
2
Commissioners; and (c) agreement by the Revenue Commissioners of any
possible attribution of gain to the Company in relation to the
disposal by the Group of the share capital of Rowarth Limited;
6.4 (Pounds)1,224,000 upon payment of the primary liability by Balmore
Enterprises Limited and the amount of such liabilities being
accepted by the Inland Revenue in accordance with its normal self-
assessment procedures in relation to Balmore Enterprises Limited
ceasing to be a member of the Group; and
6.5 (Pounds)204,000 upon the earliest to occur of: (a) the second
anniversary of the lodgement of the Irish corporation tax return by
the Company for the 99/00 tax year which has not been challenged by
the Revenue Commissioners; (b) 31 December, 2002 provided that by
such date the corporation tax return of the Company for the 99/00
tax year has not been challenged by the Revenue Commissioners; and
(c) payment of the primary liability by Raworth Limited and
agreement of the amount by the relevant Irish taxing authority in
respect of secondary liability to Irish taxation in relation to
Raworth Limited ceasing to be a member of the Group.
The number of Escrow Shares to be retained by the Purchaser shall be
determined using the same method as set forth in paragraph 3.2
above."
6. RELEASE FROM GUARANTEES, INDEMNITIES AND WARRANTIES
6.1 The Vendors warrant that all guarantees, indemnities and warranties
given by the Company and the Subsidiaries other than those Disclosed in the
Disclosure Letter have been released and no sums are owing in respect
thereof.
7. AEPONA PAYE DEDUCTION
7.1 Purchaser is proposing to make awards of shares of common stock of
the Purchaser to employees of Balmore Enterprises Limited and Rowarth
Limited (collectively, "Aepona"). The making of such awards will impose an
obligation for Aepona to operate PAYE and, if appropriate, employees
National Insurance Contributions ("NIC") arising from the grant of such
awards.
7.2 Purchaser hereby undertakes to pay over to Aepona the proceeds of
sale of shares of common stock of Purchaser withheld by Purchaser from such
awards in accordance with the documentation evidencing such awards.
Purchaser shall pay such sums within 30 days of sale by the Purchaser of
such withheld stock. Aepona shall timely notify Purchaser of the amount of
any PAYE and NIC obligations arising in respect of any grant to enable
Purchaser to withhold the appropriate number of shares of common stock from
any awards. The calculation of PAYE and NIC obligations are the sole
responsibility of Aepona.
7.3 Purchaser undertakes to indemnify Aepona against any penalties or
interest incurred by Aepona under relevant PAYE or NIC legislation as a
result of (I) any failure
3
by Purchaser to notify Aepona of an award of stock to an Aepona employee or
(ii) any failure to pay over funds within the period described in Clause
7.2 above.
8. TAX ELECTION
At the request of the Purchaser and provided that it has no material
adverse effect on the tax position in any jurisdiction of any Vendor, the
Vendors shall agree to, and cooperate with the Purchaser in, the filing of
a 338(h)(10) election under US law in respect of the sale of the shares of
the Company to Purchaser.
9. COUNTERPARTS
9.1 Execution in counterparts
This Supplemental Agreement may be executed in any number of counterparts
and by the parties on different counterparts, but shall not be effective
until each party has executed at least one counterpart.
9.2 One agreement
Each counterpart shall constitute an original of this Supplemental
Agreement but all the counterparts shall together constitute one and the
same agreement.
10. INVALIDITY
Each of the provisions of this Supplemental Agreement is severable. If any
such provision is or becomes illegal, invalid or unenforceable in any
respect under the law of any jurisdiction, the legality, validity or
enforceability in that jurisdiction of the remaining provisions of this
Supplemental Agreement shall not in any way be affected or impaired
thereby.
11. AGREEMENT TO CONTINUE IN FULL FORCE AND EFFECT
11.1 Except as expressly amended by this Supplemental Agreement, the Sale
and Purchase Agreement shall continue in full force and effect.
11.2 This Supplemental Agreement shall, to the extent that it remains to be
performed, continue in full force and effect notwithstanding Completion.
12. GOVERNING LAW AND JURISDICTION
12.1 English law
This Supplemental Agreement shall be governed by and construed in
accordance with English law.
12.2 Courts of England and Wales
The parties to this Supplemental Agreement irrevocably agree that, for the
exclusive
4
benefit of the Purchaser, the courts of England shall have jurisdiction to
settle any dispute which may arise out of or in connection with this
Supplemental Agreement and that accordingly any Proceedings may be brought
in such courts.
AS WITNESS the hands of the parties or their duly authorised representations on
the date first appearing at the head of this Supplemental Agreement.
5
SCHEDULE 1
The Vendors
Names and Addresses
Xxxxxxx Xxxxxx
0 Xxxxxxxxxx
Xxxxxxxx Xxxx
Xxxxxx
Xx. Xxxxxx
Xxxxxxxx Xxxxx
00 Xxxxxxxxx Xxxxxx
Xxxxxx
Xxxxxx 00
Xxxxxx Xxxxxxxxxx
0 Xxxxxxxx
Xxxxxxxxxxx
Xxxxxx 00
Enterprise Ireland
Xxxxxx Xxxxx
Xxxxxx Xxxxx
Xxxxxx 0
Mayfair Venture Capital Limited
Europort 932
Gibraltar
Xxxxxx Xxxxxxxxx
00 Xxxxxxxxxx
Xxxxxxx Xxxx
Xxxxxxx
Xxxxxx 0
Xxxxxxx Xxxx
Ardnacree
Xxxxxxxxxx Xxxxxx
Xxxxxxx
Xxxxxx 00
Xxxxx Xxxxx
Xxxxxxxx Xxxxx
Xxxxxxxx Xxxxxxx
Xxxxxxx
Xxxxxx 00
6
Xxxx Xxxxxxx
00 Xxxxxxxxx Xxxxxx
Xxxxxx
Xxxxxx 00
Xxxxx Xxxxxx
00 Xxxxxxxxx Xxxxx
Xxxxxxxxxxx
Xxxxxxx
Xxxxxxx XxXxxxxxx
00 Xxxxxxxxx Xxxx
Xxxxxxxxxx Xxxx
Xxxxxxx
Xxxxxxx Xxxxxx
00 Xxxxxxxxxxx Xxxx
Xxxxxxxx
Xx. Xxxx
Xxxx XxXxxxxxx
38 Mount Xxxxxxx Xxxx
Four Winds
Belfast
7
SIGNED by XXXXXXX XXXXXX
..........................................
SIGNED by XXXXXXXX XXXXX
..........................................
SIGNED by XXXXXX XXXXXXXXXX
..........................................
SIGNED for and on behalf of
ENTERPRISE IRELAND by
..........................................
SIGNED for and on behalf of ) Director
MAYFAIR VENTURE CAPITAL )
LIMITED by ) Director/Secretary
SIGNED by XXXXXXX XXXX
..........................................
SIGNED by DAVID MEGAN
..........................................
SIGNED by XXXX XXXXXXX
..........................................
SIGNED by XXXXX XXXXXX
..........................................
8
