EXHIBIT 10.4
AMENDMENT TO THE SHARE PURCHASE AGREEMENT
This AMENDMENT TO THE SHARE PURCHASE AGREEMENT, dated December 17, 1997
(the "Amendment"), is made and entered into by and among Xpedite Systems
Holdings (UK) Limited, formerly known as PHJ&W No. 2 LIMITED, an English
corporation (Registration No. 3406488) (the "Purchaser"), XPEDITE SYSTEMS, INC.,
a Delaware corporation ("Xpedite"), and the shareholders of XPEDITE SYSTEMS
LIMITED, an English corporation (Registration No. 2778084) (the "XSL
Shareholders").
WHEREAS, Purchaser, Xpedite and the XSL Shareholders are parties to that
certain Share Purchase Agreement dated August 8, 1997 (the "Purchase
Agreement"); capitalized terms not otherwise defined shall have the meanings
ascribed to them in the Purchase Agreement; and
WHEREAS, the parties hereto desire to amend the Purchase Agreement (i) to
provide for the payment in full of the Purchase Price at Closing, subject to
certain limitations described in this Amendment and (ii) to modify the currency
from U.S. Dollars to Pounds Sterling in connection with, among other things,
paying the Purchase Price, setting the maximum exposure under the indemnity
provisions contained therein and providing letters of credit to secure the
performance of certain obligations thereunder.
NOW THEREFORE, in consideration of the mutual covenants and agreements set
forth herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties to this Amendment
hereby agree as follows:
1. AMENDMENTS. The Purchase Agreement is hereby amended as follows:
----------
(a) The fifth recital is hereby amended by deleting the reference to
"$10,773,935" contained therein and substituting "(Pounds)6,424,709" in its
place.
(b) Section 1.01 is hereby amended by:
(i) deleting the references to "$87,000,000" contained therein
and substituting "(Pounds)51,182,339" in their place;
(ii) deleting the references to "$76,226,025" contained therein
and substituting "(Pounds)44,757,630" in their place;
(iii) deleting the references to "$57,000,000" contained in clause (i)
thereof and substituting "(Pounds)49,828,571" in their place;
(iv) adding the following sentence at the end of clause (i) thereof:
"APAX agrees that the Purchaser has a right of set off of (Pounds)104,559
against APAX, which amount may be withheld by the Purchaser from APAX's portion
of the Purchase Price at Closing."; and
(v) deleting clause (ii) thereof in its entirety and substituting
the following in its place:
"not later than the date ten (10) days after the final calculation of the
remaining balance of the Purchase Price (after taking into account any
adjustment to be made pursuant to SECTION 1.02) ("BALANCE AMOUNT") such
Balance Amount shall be delivered to Xxxxxxx Suddards, or to such other
persons that the Shareholders specify, for the benefit of all the
Shareholders in cash by wire transfer in immediately available funds, less
----
the amount of the Xxxxxxx Put/Call Purchase Price which shall be paid in
accordance with SECTION 1.04. Notwithstanding anything contained in this
Agreement to the contrary, in the event Xxxxx Xxxxxxx has not purchased at
least $2.0 million of Xpedite common stock within six months after the
Closing Date, as required by the Employment Agreement (as defined in
SECTION 7.07), the Purchaser shall have the right to withhold the payment
of the Balance Amount until such time as Xxxxx Xxxxxxx has purchased $2.0
million of Xpedite stock."
(c) Section 1.02 is hereby amended by deleting subsection (a) thereof
in its entirety and substituting the following in lieu thereof:
"Within sixty (60) days after the Closing Date, the Purchaser shall
prepare, in a manner consistent with the procedures and policies, bases and
methods of valuation adopted in the preparation of the audited accounts of
the Company for the year ending December 31, 1996 as detailed in SCHEDULE
1.02, and deliver to the Shareholders a consolidated balance sheet of the
Company (the "CLOSING DATE BALANCE SHEET") as at the end of the calendar
month prior to the month in which the Closing takes place (but, for the
avoidance of doubt, without taking into account the effect of the
transactions described in SECTION 9.01(b)(i) and (if the Buyback Agreement
is not terminated) the completion of the Buyback Agreement). The parties
shall have the right to dispute the Closing Date Balance Sheet as provided
in SECTION 1.02(b) hereof. The Purchase Price payable to the Shareholders
shall be increased, by the excess of the Closing Date Net Asset Value (as
defined below) over the difference between (I) the Base Net Asset Value (as
defined below) and (II) (Pounds)911,854. For purposes of this Agreement,
the term "BASE NET ASSET VALUE" shall mean the Net Asset Value (as defined
below) at the Company as of the end of the calendar month prior to the
month in which the Closing takes place, as shown in the projected balance
sheets of the Company attached as SCHEDULE 1.02(a), the term "NET ASSET
VALUE" shall mean the total assets minus total liabilities of the Company
-----
(calculated in a manner consistent with the calculation of the Base Net
Asset Value) as of the end of a particular month, and the term "CLOSING
DATE NET ASSET VALUE" shall be the Net Asset Value shown on the Closing
Date Balance Sheet; provided that for purposes of calculating "Net Asset
--------
Value" the amount of liability for amounts owed by the Company to Xpedite
shall not exceed one month of Xpedite's royalty charges to the Company.
The amount of the Purchase Price, as adjusted pursuant to this SECTION
1.02, shall be referred to herein as the "ADJUSTED PURCHASE PRICE" provided
always that the adjustment to the Purchase Price shall not in any event be
more than (Pounds)1,823,708."
(d) Section 6.17 is hereby deleted in its entirety and the following
provision shall be substituted in lieu thereof:
"Authorized Share Capital. The Shareholders shall procure that the Company
------------------------
increases its authorized share capital above (Pounds)12,059,205 by not less
than (Pounds)10,135,835 in accordance with Section 80 of the Companies Xxx
0000 by the creation of 10,135,835 Ordinary Shares of (Pounds)1.00 each to
rank pari passu in all respects with the existing ordinary shares of
(Pounds)1.00 each in the capital of the Company and to disapply the pre-
emption rights contained in Section 89 of the Companies Xxx 0000 and any
contained in the Company's Articles of Association in relation to the
allotment of such shares. The Shareholders shall be permitted, and shall
take all necessary actions, to amend the Articles of Association of the
Company to increase the authorized number of Ordinary Shares of
(Pounds)1.00 each in order to facilitate the increase in share capital set
out in this SECTION 6.17."
(e) Section 7.04 is hereby amended by deleting the reference to
"$5,000,000" contained therein and substituting "(Pounds)3,039,514" in its
place.
(f) Section 8.04 is hereby deleted in its entirety.
(g) Section 9.01(b) is hereby amended by:
(i) deleting the reference to "$57,000,000" contained in clause
(i) thereof and substituting "(Pounds)49,828,571" in its place; and
(ii) deleting clause (Second) in its entirety and substituting the
following in lieu thereof:
"Subject to the Buyback Agreement not having been terminated, in
subscribing at par for 6,424,709 ordinary shares of (Pounds)1.00 each
in the capital of the Company which are to be created in the increase
in the authorized share capital of the Company pursuant to SECTION
6.17, which (Pounds)6,424,709 will be applied at Closing by Xxxxxxx
Suddards to satisfy the Company's obligations under the Buyback
Agreement;"
(h) Section 10.02 is hereby amended by deleting the reference to
"$1,700,000" contained therein and substituting "(Pounds)1,033,435" in its
place.
(i) Section 11.09 is hereby amended by deleting the reference to
"$5,000,000" contained therein and substituting "(Pounds)3,039,514" in its
place.
(j) Schedules 1 and 1A are hereby deleted in their entirety and the
Schedules 1 and 1A attached to this Amendment shall be substituted in their
place.
2. MISCELLANEOUS.
-------------
(a) Except as specifically amended by this Agreement, the terms of
the Purchase Agreement shall remain in full force and effect and are hereby
ratified and confirmed.
(b) The execution, delivery and performance of this Amendment shall
not, except as expressly provided herein, constitute a waiver or amendment of
any provision of the Purchase Agreement.
(c) This Amendment shall be construed in accordance with the laws of
England.
(d) This Amendment embodies the entire agreement and understanding
between the parties hereto and supercedes all prior agreements and
understandings relating to the subject matter hereof.
(e) This Amendment may be executed in counterparts, each of which
shall be an original, and all of which, taken together, shall constitute a
single instrument.
[LEFT INTENTIONALLY BLANK]
IN WITNESS WHEREOF, the parties hereto have executed this Amendment, or
have caused this Amendment to be executed on its behalf by a duly authorized
representative, all as of the day and year first above written.
XPEDITE SYSTEMS HOLDINGS (UK)
LIMITED, formerly known as, PHJ&W NO. 2 LIMITED
By: /s/ Xxxxxx Xxxxxx
-------------------------------
Name: Xxxxxx Xxxxxx
Title:
XPEDITE SYSTEMS, INC.
By: /s/ Xxxxxx Xxxxxx
-------------------------------
Name: Xxxxxx Xxxxxx
Title:
SHAREHOLDERS:
By: /s/ Xxxxx Xxxxxxx
-------------------------------
Xxxxx Xxxxxxx
WITNESS: /s/ /s/ Xxxxx Xxxxxxx
--------------------- --------------------------------------------
Executed as a DEED by Xxxx Xxxxxxx,
acting by Xxxxx Xxxxxxx, his duly
authorized attorney
APAX PARTNERS & CO. VENTURES
LIMITED, as manager of Apax Ventures IV
International Partners, L.P.
By: /s/ Xxxx Xxxxxxxx McMonigall
------------------------------
Name: Xxxx Xxxxxxxx McMonigall
Title:
Schedule 1
----------
SHAREHOLDER CLASS OF SHARE NO. OF CONSIDERATION
SHARES
---------------------- --------------------- ------------ ----------------------------
Apax Funds Nominees "A" ordinary of 250,000 250,000
Limited, B Account (as (Pounds)1.00 each -------
custodian trustee for 274,999 of the amount payable
Apax Ventures under Sections 1.01(ii) and
International Partners 9.01(b)(i)(Fourth)
LP and Apax Ventures
IV)
Preference Shares of 2,355,288 The nominal value plus all
(Pounds)1.00 each accrued dividends, interest and
penalties (if any) calculated
down to the Closing Date
Xxxxx Xxxxxxx Preference Shares of 19,712 The nominal value plus all
(Pounds)1.00 each accrued dividends, interest and
penalties (if any) calculated
down to the Closing Date
Xxxx Xxxxxxx Ordinary shares of 10,000 10,000
(Pounds)1.00 each -------
284,999 of the amount
obtained by subtracting the
amounts paid to redeem the
"A" Preference Shares and
purchase the Preference Shares
of (Pounds)1.00 each from the
Adjusted Purchase Price and
adding (Pounds)793,345 to such
amount
Rothschild Nominees Ordinary shares of 1,666 1,666
Limited (as trustee for (Pounds)1.00 each -------
N.M. Rothschild & Sons 274,999 of the amount payable
Limited) under Sections 1.01(ii) and
9.01(b)(i)(Fourth)
Xxxxx Xxxxxxx Ordinary shares of 3,267 3,267
(Pounds)1.00 each (held -------
under option) 274,999 of the amount payable
under Sections 1.01(ii) and
9.01(b)(i)(Fourth)
Holders of Options Ordinary shares of 20,066 20,066
(Pounds)1.00 each (held -------
under option) 274,999 of the amount payable
under Sections 1.01(ii) and
9.01(b)(i)(Fourth)
Schedule 1A
-----------
SHAREHOLDER CLASS OF SHARE NO. OF SHARES CONSIDERATION
------------------------ --------------------- --------------- ---------------------------
Apax Funds Nominees "A" ordinary of 250,000 250,000
Limited, B Account (as (Pounds)1.00 each -------
custodian trustee for 323,333 of the amount
Apax Ventures payable under Sections
International Partners 1.01(ii) and
LP and Apax Ventures 9.01(b)(i)(Fourth)
IV)
Preference Shares 2,355,288 The nominal value plus all
of (Pounds)1.00 each accrued dividends, interest
and penalties (if any)
calculated down to the
Closing Date
Xxxxx Xxxxxxx Preference Shares 19,712 The nominal value plus all
of (Pounds)1.00 each accrued dividends, interest
and penalties (if any)
calculated down to the
Closing Date
Xxxx Xxxxxxx Ordinary shares of 10,000 10,000
(Pounds)1.00 each -------
333,333 of the amount
obtained from subtracting
the amounts paid to
redeem the "A" Preference
Shares and purchase the
Preference Shares of (Pounds)1.00
each from the Adjusted
Purchase Price and adding
(Pounds)793,345 to such amount
Rothschild Nominees Ordinary shares of 1,666 1,666
Limited (as trustee for (Pounds)1.00 each -------
N.M. Rothschild & Sons 323,333 of the amount
Limited) payable under Sections
1.01(ii) and
9.01(b)(i)(Fourth)
Eagle Nominees Limited Ordinary Shares 48,334 48,334
of (Pounds)1.00 each -------
323,333 of the amount
payable under Sections
1.01(ii) and
9.01(b)(i)(Fourth)
Xxxxx Xxxxxxx Ordinary shares of 3,267 3,267
(Pounds)1.00 each (held -------
under option) 323,333 of the amount
payable under Sections
1.01(ii) and
9.01(b)(i)(Fourth)
Holders of Options Ordinary shares of 20,066 20,066
(Pounds)1.00 each (held -------
under option) 323,333 of the amount
payable under Sections
1.01(ii) and
9.01(b)(i)(Fourth)
