STOCK PURCHASE AGREEMENT
THIS STOCK PURCHASE AGREEMENT ("Agreement") is made and
entered into as of the 30th day of November, 1998, by and among
Pacific Systems Corporation (hereinafter "PSC"), a Commonwealth
of the Northern Mariana Islands corporation having its principal
offices at 000 Xxxxxx Xxxxx Xxxx, Xxxxx, Xxxx 00000 and the
individuals listed on Exhibit A hereto (each a "Seller" and
collectively, "Sellers"), PCI Communications, Inc., a Guam
corporation ("Company"), and Startec Global Communications
Corporation (hereafter "Buyer"), a Maryland corporation having
its principal offices at 00000 Xxxxx Xxxx Xxxxx, Xxxxxxxx,
Xxxxxxxx 00000.
Recitals:
A. Sellers own and control all of the equity securities of
the Company.
B. PSC is the record and beneficial owner and holder of
662,470 of the shares of the outstanding common stock of PCI (the
"Company Stock"), which stock holdings constitute a 99.99%
ownership percentage of the outstanding equity securities of PCI.
Ownership of the remaining less than one percent (1%) of the
outstanding equity securities of PCI is held by those individual
Sellers identified in Exhibit A hereto.
C. Buyer desires to purchase from Sellers all of the
issued and outstanding equity securities of the Company on the
terms and conditions hereinafter set forth.
X. Xxxxxxx desire to sell all of the issued and
outstanding equity securities of the Company to Buyer for the
consideration, on the terms and conditions, hereinafter set
forth.
NOW, THEREFORE, in consideration of the recitals and of the
respective covenants, representations, and agreements herein
contained, the sufficiency of which is hereby acknowledged, the
parties hereto agree as follows:
1. Purchase and Sale of Stock. Sellers, in reliance on
the representations, warranties, and covenants of Buyer contained
herein and subject to the terms and conditions of this Agreement,
hereby sell to Buyer all of the shares of the Company Stock
which they own for the Purchase Price set forth in Section 2
below (subject to adjustment as provided herein), and Buyer, in
reliance on the representations, warranties, and covenants of the
Sellers contained herein and subject to the terms and conditions
of this Agreement, hereby purchases from Sellers, the Company
Stock for the Purchase Price as set forth in Section 2 below
(subject to adjustment as provided herein). Each Seller shall
receive an amount equal to the Purchase Price multiplied by such
Seller's Proportionate Interest as set forth after such Seller's
name on Exhibit A.
2. Purchase Price
2.1 Purchase Price. The purchase price (the "Purchase
Price") to be paid by Buyer to the Sellers for the Company Stock
is Two Million Six Hundred Fifty Thousand and No/100 Dollars
($2,650,000), payable pursuant to Section 2.2 (and subject to
adjustment as provided below).
2.2 Payment of Purchase Price.
(a) The Purchase Price is being paid as follows:
Subject to the terms and conditions of this Agreement, on the
date hereof, Buyer is depositing Two Million Two Hundred Seventy
Two Thousand Four Hundred Fifty Seven and 36/100 Dollars
($2,272,457.36) (the "Escrow Payment"), in immediately available
funds with First Union National Bank (the "Escrow Agent"), to be
held by the Escrow Agent pursuant to the escrow agreement
attached hereto as Exhibit B (the "Escrow Agreement"). Of the
Escrow Payment, One Million Eight Hundred Thirty Thousand and
No/100 Dollars ($1,830,000) shall be referred to as the
"Litigation Escrow Payment" and the remaining Four Hundred Forty
Two Thousand Four Hundred Fifty Seven and 36/100 Dollars
($442,457.36) shall be referred to as the "Adjustment Escrow
Payment."
(b) The remainder of the Purchase Price was paid
prior to the date hereof as follows:(i) One Hundred Fifty
Thousand and No/100 Dollars ($150,000) was delivered from Buyer
to Sellers in cash on October 15, 1998, and (ii) Two Hundred
Twenty-Seven Thousand Five Hundred Forty-Two and 64/100 Dollars
($227,542.64) was paid by Buyer to certain creditors of Company
at the direction, and for the benefit, of Company and Sellers.
The Company and Sellers hereby acknowledge payment of such
amounts.
2.3 Purchase Price Adjustment.
(a) The Purchase Price shall be subject to a
post- closing adjustment in accordance with the following
procedure: Sellers will cause the Company to prepare, and will
cause Deloitte & Touche LLP, the Company's certified public
accountants, to audit, the financial statements ("Closing
Financial Statements") of the Company and deliver its reports
thereon for the fiscal years ending September 30, 1997 and 1998.
Sellers will use their best efforts to cause the Closing
Financial Statements to be delivered to Buyer within forty-five
(45) days of the date hereof and Buyer will have fifteen (15)
days following delivery of the Closing Financial Statements to
cause its certified public accountants to review the Closing
Financial Statements. Based on the review of the unaudited
July 31, 1998 financial statements of the Company (the "July 31,
1998 Balance Sheet"), the parties have entered into this
Agreement with the reasonable expectation, that the excess of (1)
the total assets of the Company ($6,315,557), over (2) the total
liabilities of the Company ($5,658,155) was $657,412 (which
number shall be referred to as the "Assumed Value"). To the
extent that a review of the Closing Financial Statements
indicates that the actual value of the Company as of September
30, 1998 is less than the Assumed Value, the Purchase Price shall
be reduced, on a dollar for dollar basis, by the amount of the
difference between the Assumed Value and the actual value of the
Company on September 30, 1998. In the event of any such
reduction in the Purchase Price, the amount of such adjustment
shall be released from the Adjustment Escrow Payment to the Buyer
in accordance with the terms of the Escrow Agreement.
Notwithstanding the foregoing, there shall be no reduction in the
Purchase Price under this subsection as a result of any
diminution in the valuation of the Company (as reflected on the
Closing Financial Statements) which is attributable to the items
reflected on the attached Schedule 2.3(a).
(b) The Purchase Price shall be subject to an
additional post-closing adjustment in accordance with the
following procedure: Following completion and delivery to Buyer
of the Closing Financial Statements, Sellers will cause the
Company to prepare unaudited financial statements covering the
period from September 30, 1998 to the date hereof (the "Final
Financial Statements"). Buyer acknowledges that after the date
hereof, Buyer will be the owner of the records and equipment (as
well as the employer of the personnel) necessary for Sellers to
prepare the Final Financial Statements. In this regard, Buyer
consents to the use of such records, equipment and personnel by
Sellers for the purpose of preparing Final Financial Statements
as required by this Section 2.3(b). Buyer will have fifteen (15)
days following the delivery of the Final Financial Statements, to
cause its certified public accountants to review the Final
Financial Statements. To the extent that such review indicates
that the actual value of the Company as of the date hereof is
less than the Assumed Value (as defined in Section 2.3(a) above),
the Purchase Price shall be reduced, on a dollar for dollar
basis, by the amount of the difference between the Assumed Value
and the actual value of the Company at the date hereof (subject
to a credit given for any reductions in the Purchase Price which
have already been made as a result of the provisions of Section
2.3(a) above). In the event of any such reduction in the
Purchase Price, the amount of such adjustment shall be released
from the Adjustment Escrow Payment to the Buyer and the remainder
of the Adjustment Escrow Payment shall be released to the
Sellers, all in accordance with the terms of the Escrow
Agreement. Notwithstanding the foregoing, there shall be no
reduction in the Purchase Price under this subsection as a result
of any diminution in the valuation of the Company (as reflected
on the Final Financial Statements) which is attributable to the
items reflected on the attached Schedule 2.3(a).
(c) The Purchase Price shall be subject to an
additional post-closing adjustment in accordance with the
following procedure: On the July 31, 1998 Balance Sheet, the
Company has reserved the amount of Eight Hundred Sixty Thousand
Five Hundred Fifty-Seven and No/100 Dollars ($860,557) (the "Tax
Reserve") to provide for the payment of the corporate income
taxes set forth on the attached Schedule 2.3(c). If, within
twelve (12) months from the date hereof, the Company is able to
fully and completely satisfy all of the tax obligations set forth
on Schedule 2.3(c) for an aggregate amount which is less than the
Tax Reserve, Buyer shall pay to Sellers the difference between
the Tax Reserve and the amount actually expended to satisfy such
taxes obligations.
(d) Nothwithstanding anything to the contrary in
subsections 2.3(a), 2.3(b), 2.3(c) or Section 2.4 below, to the
extent that (i) the amount of the Adjustment Escrow Payment is
insufficient to provide for all required post-closing adjustments
and/or (ii) the amount of the Tax Reserve is insufficient to
satisfy the tax obigations pursuant to subsection 2.3(c), no
amounts shall be released to Sellers from the Escrow Payment
until such definciencies have been satisfied through a dollar for
dollar reduction in the Purchase Price, which reduction shall be
paid from the Escrow Payment (whether it be the Adjustment Escrow
Payment or the Litigation Escrow Payment) to Buyer.
(e) Upon completion and delivery to Buyer of the
Closing Financial Statements and the Final Financial Statements,
Buyer, shall, in sole discretion, make any adjustments which may
be necessary to fairly reconcile the intercompany debt between
Company and PSC.
2.4 Litigation Escrow Payment. Sellers shall have a
period of twelve (12) months from the date hereof to resolve any
known liability identified on Schedule 4.11. If any such
liability is resolved by December 21, 1999 for a sum less than
that for which the Seller shall have reserved or accrued amounts
in relation to such liability (as reflected on Schedule 4.11),
then the difference between the amount reserved or accrued for
such liability and the aggregate amount expended to resolve such
liability, less any legal expenses reasonably incurred by Buyer,
shall be released to Sellers from the Litigation Escrow Payment
pursuant to the terms of the Escrow Agreement as part of the
compensation due to Sellers under this Agreement, such payment to
be made in accordance with the Escrow Agreement. The parties
specifically agree that except as required by applicable law or
regulation, including, but not limited to, the Federal securities
laws (and the disclosure requirements thereunder) and/or the
rules of any national securities exchange or the National
Association of Securities Dealers, the terms of this Section 2.4
shall be kept confidential by the parties, except as disclosed to
Xxxxxxx Xx. Xxxxxxxx and his counsel, who shall be required to
keep the terms of this Agreement confidential. Notwithstanding
anything in this Section 2.4 to the contrary, no amounts shall be
released to Sellers under this Section 2.4 unless and until (i)
Sellers have fully and completely satisfied all of the tax
obligations set forth on Schedule 2.3(c) in the manner set forth
in that subsection and (ii) Sellers have caused the removal of
that certain lien on the property and rights to property of the
Company filed by the Government of Guam Department of Revenue and
Taxation on October 31, 1997.
3. Deliveries.
3.1 Delivery of Stock. On the date hereof, Sellers are
delivering, free and clear of all liens, encumbrances, claims,
and other charges thereon of every kind, the certificates for the
shares of the Company Stock in negotiable form, duly endorsed in
blank to Buyer or accompanied by appropriate stock powers, in
exchange for delivery by Buyer to Sellers of the Purchase Price
in the manner set forth in Section 2.2. Any transfer fees,
charges or taxes due and payable on the delivery and transfer of
the Company Stock to Buyer shall be paid by Sellers.
3.2 Resignations. On the date hereof, Sellers are
providing to Buyer the written resignations of all the directors
and officers of the Company effective as of the date hereof, and
turning over or making available to Buyer all minute books, stock
record books, books of account, corporate seals, leases,
contracts, agreements, securities, customer and subscriber lists,
files and other documents, instruments, and papers belonging to
the Company, and causing full possession and control of all of
the assets and property of every kind and nature, tangible and
intangible, of the Company and of all other things and matters
pertaining to the operation of the business of the Company to be
transferred and delivered to the offices of the Company in Guam.
3.3 Opinion of Sellers' Counsel. On the date hereof,
Sellers are delivering to Buyer an opinion of their counsel,
Xxxxxx X. Van xx xxxx, Esquire, dated the date hereof and in form
and substance satisfactory to Buyer to the effect that:
(a) Sellers are the lawful owners of record and
beneficial owners of all the number of shares of the Company
Stock set forth beside their names in Exhibit A, free and clear
of any liens, encumbrances, equities, and claims known to such
counsel after investigation, each Seller has full legal power and
all authorization required by law to transfer and deliver said
shares in accordance with this Agreement, and, assuming the
signatures are as indicated thereon, by delivery of a certificate
or certificates therefor will transfer to Buyer valid and
marketable title to said shares, free and clear of any liens,
encumbrances, equities, and claims, known to such counsel.
Further, the unqualified guarantee of the signature of an
endorser constitutes a warranty that at the time of signing, the
signature was genuine and the signer was an appropriate person to
endorse and the signer had legal capacity to sign. The shares of
Company Stock listed on Exhibit A constitute all of the issued
and outstanding equity securities of the Company. The Company has
an authorized capital as set forth in Section 4.2 of this
Agreement and all of the issued and outstanding shares of
capital stock of the Company have been duly and validly
authorized and issued, and are fully paid and non-assessable.
(b) Neither the Company nor any Seller is known
to counsel after investigation to be a party to, or bound by, nor
does counsel have any reason to believe that the Company or any
Seller is a party to or bound by, any written or oral contract or
agreement which grants to any person an option or right of first
refusal or other right to acquire at any time, or upon the
happening of any stated events, any equity securities of the
Company or any other security convertible into or exercisable for
any equity securities of the Company.
(c) The Company is a corporation duly organized,
validly existing, and in good standing under the laws of the
state or other jurisdiction of incorporation, and it has the
corporate power to conduct its business and to own and hold the
properties used in connection therewith. The Company is duly
qualified to do business and is in good standing as a foreign
corporation in each jurisdiction in which the Company's ownership
or lease of property or the conduct of the Company's business
requires such qualification.
(d) The consummation of the transactions
contemplated by this Agreement will not result in a breach of any
term or provision of or constitute a default under the Articles
of Incorporation or By-Laws of the Company, or any indenture,
agreement, instrument, or understanding known to such counsel to
which the Company is a party or by which it is bound.
(e) Such counsel knows of no legal or government
proceedings, litigation, claims, proceedings, or investigations
pending against the Company that would reasonably be expected to
have a material adverse effect on the Company, its assets or its
operations or its right to consummate the transactions
contemplated hereby, except as set forth on Schedule 4.11.
(f) The Agreement has been duly authorized by
PSC, and when duly executed and delivered by PSC, will constitute
a valid and legally binding agreement of PSC enforceable against
PSC in accordance with its terms, except where the enforceability
thereof may be limited by bankruptcy, insolvency, reorganization,
fraudulent conveyance, moratorium or other similar laws now or
hereafter in effect relating to rights of creditors and other
obligees generally. Except as disclosed in this Agreement, no
consent or approval of any other person or entity is necessary
for the consummation of the transactions contemplated by this
Agreement.
(g) The Agreement has been duly authorized by the
individual Sellers, and when duly executed and delivered by the
individual Sellers, will constitute a valid and legally binding
agreement of the individual Sellers enforceable against the
Sellers in accordance with its terms, except where the
enforceability thereof may be limited by bankruptcy, insolvency,
reorganization, fraudulent conveyance, moratorium or other
similar laws now or hereafter in effect relating to rights of
creditors and other obligees generally.
(h) To the knowledge of such counsel after due
inquiry, the Company is not (i) in violation of its charter or
by-laws, (ii) in default, and no event has occurred which, with
notice or lapse of time or both, would constitute such a default,
in the due performance or observance of any time period, covenant
or condition contained in material contract or agreement of the
Company, or (iii) is in violation in any material respect of any
law, ordinance, governmental rule, regulation or court decree to
which the Company or its properties or assets may be subject or
has failed to obtain any material license, permit, certificate,
franchise or other governmental authorization or permit necessary
to the ownership of its properties or assets or to the conduct of
its business.
In furnishing such opinion, counsel may rely upon
certificates of officers of the Company, opinion of counsel in
foreign jurisdictions, and such other documents and data as he
deems appropriate as a basis for his opinion, and make his
opinion subject to the accuracy thereof.
3.4 Opinion of Buyer's Counsel. On the date hereof,
Buyer is delivering to Sellers an opinion of its counsel,
Xxxxxxxx Xxxxxxxx Xxxxx & Xxxxx LLP, dated the date hereof, and
in form and substance satisfactory to Seller, with respect to the
matters referred to in subsections 6.1 and 6.2.
3.5 Employment Agreements. On the date hereof, Buyer
is entering into employment agreements with Xxxxxx X. Xxxxxxx and
Xxxx Day substantially in the forms attached hereto as Exhibits C
and D.
3.6 Assignment of Assets. On the date hereof, Sellers
are delivering to Buyer evidence of a valid and binding document
of assignment conveying from PSC to Company full and marketable
title to the assets set forth on Schedule 4.9(b), free and clear
of all mortgages, liens, pledges, charges or other encumbrances
of any nature whatsoever.
3.7 Employees On the date hereof, Sellers are
delivering to Buyer a letter executed by the President of PSC
indicating that Company is entitled to hire any and all of the
PSC employees listed on the attached Schedule 3.7, without any
obligation in respect thereof to PSC.
3.8 Assignment of Leases. On the date hereof, Sellers
are delivering to Buyer a valid and binding assignment of the
lease attached hereto as Exhibit E, which lease relates to the
Company's office space in Guam. In connection therewith, Buyer
agrees to sublease up to twenty-five percent (25%) of said office
space to Pacific Data Systems, an affiliate of PSC, on a
month-to-month term, at a rental rent not to exceed PDS'
proportional share of such space, which sublease shall be
consistent with the terms and conditions of the lease attached as
Exhibit E.
3.9 Resolutions. On the date hereof, Sellers are
delivering to Buyer certified resolutions of PSC's Board of
Directors and its shareholders evidencing their respective
approval of the transactions contemplated by this Agreement.
3.10 Articles of Incorporation. On the date hereof,
Sellers are delivering to Buyer a certified original of the
Company's Articles of Incorporation which, among other things,
provides that the capitalization of the Company is as represented
in Section 4.2 below.
4. Representations and Warranties of Sellers. Sellers and
PCI hereby represent and warrant to Buyer, jointly and severally,
as follows:
4.1 Organization, Standing and Qualification. The
Company is a corporation duly organized, validly existing, and in
good standing under the laws of the jurisdiction under which it
is incorporated and has the corporate power to perform its
business as presently conducted and to own and lease the
properties used in connection therewith. A complete and correct
copy of the Articles of Incorporation and all amendments thereto
of the Company and a complete and correct copy of the By-Laws and
all amendments thereto, certified by its secretary, are being
delivered to Buyer. The Company is duly qualified to do business
and is in good standing in each jurisdiction wherein the conduct
of its business or the ownership of its property requires such
qualification.
4.2 Capitalization. The Company's authorized capital
stock consists of 1,000,000 shares of common stock. There are
662,490 shares of Company common stock presently issued and
outstanding. All of the issued and outstanding shares of Company
Stock have been duly authorized and validly issued, are fully
paid and non-assessable, were not issued in violation of the
terms of any contract or agreement binding upon the Company, and
were issued in compliance with all applicable charter documents
of the Company and all applicable federal and state securities or
"blue sky" laws and regulations. No equity securities of the
Company, other than the Company Stock, are issued or outstanding.
There are, and have been, no preemptive rights with respect to
the issuance of the shares of Company Stock. There are: (a) no
existing contracts, subscriptions, options, warrants, calls,
commitments or rights of any character to purchase or otherwise
acquire any capital shares or other securities of the Company,
whether or not presently issued or outstanding, from any
shareholder and/or the Company, at any time, or upon the
happening of any stated event; (b) no outstanding securities of
any subsidiary that are convertible into or exchangeable for
capital shares or other securities of the Company or any
subsidiary; and (c) no contracts, subscriptions, options,
warrants, calls, commitments or rights to purchase or otherwise
acquire from any Seller, the Company or any subsidiary any such
convertible or exchangeable securities.
4.3 Ownership of Stock. Each Seller is the lawful and
beneficial and record owner of the number of shares of Company
Stock set forth in Exhibit A hereof, and such shares are free and
clear of all liens, encumbrances, claims, and other charges of
every kind (with the exception of any liens and encumbrances in
favor of Buyer created by that certain Pledge and Security
Agreement dated October 15, 1998 by and among Company, Buyer and
PSC), and each Seller has full legal power and all authorization
required by law to transfer and deliver said shares in accordance
with this Agreement. Each Seller has the full power and authority
to execute, deliver and perform this Agreement and has taken all
actions necessary to secure all approvals required in connection
therewith. The execution and delivery of this Agreement and the
consummation of the transactions herein contemplated will not
contravene or violate the Articles of Incorporation or By-Laws of
the Company or PSC. This Agreement constitutes the legal, valid
and binding obligation of each Seller, enforceable against such
Seller in accordance with its terms. Neither the Sellers nor the
Company are now a party to, or bound by, any written or oral
contract or agreement which grants to any person an option or
right of first refusal or other right of any character to acquire
at any time or upon the happening of any stated events, any
equity securities of the Company or any security convertible into
or exchangeable for any equity security of the Company whether or
not presently issued or outstanding.
4.4 Validity of Contemplated Transactions. Neither
the execution and delivery of this Agreement by any Seller nor
the consummation of the transactions contemplated hereby will
contravene or violate any regulation or court order which is
applicable to the Company or any Seller, or will result in a
default under, or require the consent or approval of any party
to, any contract relating to the business or the assets of the
Company or to or by which the Company or any Seller is a party or
otherwise bound or affected, or require the Company or any Seller
to notify or obtain any license or consent from any federal,
state, local or other court or governmental agency or body or
from any other regulatory authority.
4.5 Restrictions. Except as set forth on Schedule
4.5, neither the Company nor any Seller is a party to any
contract or subject to any restriction or any court order or
regulation which adversely affects the Company or the assets or
the business of the Company or affects or restricts the ability
of the Company or any Seller to consummate the transactions
contemplated by this Agreement.
4.6 Third-Party Options. There are no existing
contracts, options, commitments or rights with, to or in any
third party to acquire the Company, any of the assets of the
Company, or any interest therein.
4.7 Subsidiaries of the Company. The Company has no
subsidiaries and is not a member of, or participant in, any
partnership or joint venture, and owns no stock or similar
interest in any corporation or other entity.
4.8 Financial Information. Seller has delivered to
Buyer the audited financial reports of the Company at September
30, 1995 and September 30, 1996 together with the unaudited and
internally generated financial statements of the Company at
September 30, 1997 and July 31, 1998 as shown in Schedule 4.8(a)
hereof. All liabilities of the Company required to be reflected
or reserved for by generally accepted accounting principles
consistently applied ("GAAP"), are fully reflected or reserved
for in the Company's consolidated balance sheet for the period
ended September 30, 1997 and the interim period ended July 31,
1998, and will be reflected in the Closing Financial Statements.
The audited financial reports of the Company at September 30,
1995 and September 30, 1996 were, and the Closing Financial
Statements and Final Financial Statements will be, prepared in
accordance with GAAP and, subject to any qualifications set forth
in the applicable notes and schedules, will fairly present the
financial position and results of operations of the Company at
the dates and for the periods covered and include all adjustments
that are necessary for a fair presentation of the information
shown.
(a) Accounts Receivable. The accounts receivable
of the Company reflected on the July 31, 1998 Balance Sheet, and
all accounts receivable acquired by the Company subsequent to
July 31, 1998 (i) have arisen only in the ordinary course of
business and (ii) are collectible in full at the recorded amounts
thereof (free of any, and subject to no, meritorious defenses,
setoffs or counterclaims) in the ordinary course of business
(without resort to litigation or assignment to a collection
agency), but in no event later than 90 days after the date
hereof, net of any allowance for doubtful accounts reflected on
the July 31, 1998 Balance Sheet, as adjusted on the Closing
Financial Statements.
(b) Fixed Assets. The fixed assets of the Company
reflected on the July 31, 1998 Balance Sheet are (and the fixed
assets of the Company reflected on the Closing Financial
Statements and Final Financial Statements will be) stated at
cost, less aggregate allowances for depreciation and
amortization, which have been provided based upon the estimated
useful lives of the assets currently used in the operations and
to reduce idle fixed assets to net realizable value; and Schedule
4.8(b) correctly identifies these assets.
4.9 Title to Assets. Schedule 4.9(a) sets forth a list
of all of the Company's assets including, but not limited to,
tangible and intangible assets. Schedule 4.9(b) sets forth a
list of all of the PSC assets which are necessary for the
operation of the Company's international and Guam based
telecommunications business, which assets have been transferred
to the Company prior to the date hereof. The Company and PSC,
respectively, have good and marketable title to all the assets
reflected on Schedules 4.9(a) and 4.9(b), free and clear of all
mortgages, liens, pledges, charges, or other encumbrances of any
nature whatsoever, except (i) mortgages, liens, pledges, charges,
or other encumbrances disclosed on the books of the Company; (ii)
liens for current taxes not yet due and payable or being
contested in good faith by appropriate proceedings; or (iii) such
imperfections of title and encumbrances, if any, as are not
substantial and do not materially detract from the value, or
interfere with the present use, of the properties subject thereto
or affected thereby, or otherwise materially impair business
operations as heretofore conducted by the Company; but
substantially all plants, structures, and equipment owned or used
by the Company are in good operating condition and repair and are
usable in the ordinary course of the Company's business
consistent with past practice and conform in all material
respects to all applicable regulations relating to their
construction, use and operation. PSC represents and warrants
that it has taken all necessary corporate action (including any
required shareholder approval) to cause a valid and enforceable
transfer to the Company of all of the assets listed on Schedule
4.9(b).
4.10 Tax Matters. The Company has filed all required
income tax returns and all other appropriate tax returns and tax
reports which are required to be filed by it and has, with
certain exceptions as noted on its July 31, 1998 Balance Sheet,
paid all taxes shown to be due thereby; the liabilities and
reserves for taxes on the July 31, 1998 Balance Sheet are
sufficient for the payment of all taxes attributable to income
earned, gross receipts, and payroll, prior to and including July
31, 1998 yet unpaid and includes adequate provision for penalties
and interest on any unpaid taxes through that date as well
deferred taxes.
4.11 Litigation. Except as provided for or disclosed
on Schedule 4.11:
(a) there is no litigation, claim, proceeding, or
governmental investigation pending or to the knowledge of Sellers
or Company threatened, against or related to the Company, or its
properties or business; and
(b) the Company is not in default with respect to
any order, writ, injunction, or decree against it of any court or
Federal, state, municipal, or governmental department,
commission, board, bureau, agency, or instrumentality, which
involves the possibility of any judgment or liability which may
result in any material adverse change in the financial condition,
assets, liabilities, properties, or businesses of the Company.
With respect to the litigation and claims set forth on Schedule
4.11, Sellers have also set forth a specific dollar amount which
has been accrued or reserved for each such matter.
4.12 Insurance. Schedule 4.12 contains a true and
complete schedule of all insurance policies or binders of fire,
liability, product liability, vehicular and other insurance held
by or on behalf of the Company or relating to its business or any
of its assets or properties (specifying the insurer, the amount
of the coverage, the type of insurance, the risks insured, the
policy number, if any, and any pending claims thereunder). All
insurance coverage applicable to the Company or relating to its
business or any of its assets or properties is in full force and
effect, is valid, binding and enforceable in accordance with its
terms against the respective insurers, insures the Company in
reasonably sufficient amounts against all risks usually insured
against by persons operating similar businesses or properties in
the localities where such businesses or properties are located
and has been issued by insurers of recognized responsibility.
There is no default under any such coverage nor has any notice of
cancellation or non-renewal for any such policy been received by
the Company.
4.13 Licenses. Schedule 4.13(a) sets forth a complete
list of all Licenses (as defined below) used in the operation of
the Company's business or otherwise held by the Company. The
Company owns, possesses or lawfully uses in the operation of its
business all Licenses which are necessary to conduct the
Company's business as now or previously conducted or to the
ownership of the Company's assets, free and clear of all liens,
encumbrances on the ownership, possession or use of such
Licenses. The Company is not in default, nor has it received any
notice of any claim of default, with respect to any such License.
Except as otherwise disclosed on Schedule 4.13(b), all such
Licenses are renewable by their terms or in the ordinary course
of business without the need to comply with any special
qualification procedures or to pay any amounts other than routine
filing fees, will not be adversely affected by the completion of
the transactions contemplated by this Agreement and will not
require the consent or approval of any person in connection with
the transactions contemplated by this Agreement. No present or
former shareholder, director, officer or employee of the Company,
nor any affiliates of any of them, or any other person, firm,
corporation or other entity owns or has any proprietary,
financial or other interest (direct or indirect) in any License
which the Company owns, possesses or uses. For purposes of this
Agreement, "Licenses" means licenses, franchises, permits,
easements, rights and other authorizations.
4.14 Intellectual Property.
(a) No employee of the Company is, or is now
expected to be, in default under any term of any employment
contract, agreement or arrangement relating to any Intellectual
Property (as defined below) or non-competition arrangement, or
any other contract or any restrictive covenant relating to the
right of any such officer or employee to be employed by the
Company because of the nature of the business conducted or to be
conducted by the Company or relating to the use of any
Intellectual Property of others, and the continued employment of
the Company's officers and employees does not subject the
Company to any liability resulting from such a violation. The
Intellectual Property of the Company was developed entirely by
its employees during the time they were employees only
of the Company and such Intellectual Property does not include
any inventions of the employees made prior to the time such
employees became employees of the Company nor any Intellectual
Property of any previous employer of such employee. For purposes
of this Agreement, "Intellectual Property" means copyrights,
patents, trademarks, technology rights and licenses, computer
software (including, without limitation, any source or object
codes therefor or documentation relating thereto), trade secrets,
franchises, know-how, inventions and intellectual property
rights.
(b) The Company owns or has a valid right to use
the Intellectual Property being used to conduct the business of
the Company; and the conduct of its business as now operated and
as now proposed to be operated does not and will not conflict
with valid Intellectual Property rights of others. The Company
has not received any communication alleging that the Company has
violated or, by conducting its business as proposed would
violate any of the Intellectual Property rights of any other
person or entity. The Company does not have any obligation to
compensate any Person for the use of any such Intellectual
Property rights nor has the Company granted to any Person any
license, option or other rights to use in any manner any of the
Intellectual Property of the Company, whether requiring the
payment of royalties or not.
4.15 Contracts and Commitments. Except as listed and
described in Schedule 4.15 hereto, the Company is not a party to
any written or oral:
(a) contract or commitment with any present or
former director or employee or consultant;
(b) contract or commitment with any labor union;
or any contract or commitment for the future purchase of, or
payment for, equipment, supplies, or telecommunications
transmission facilities except such contracts or commitments as
are issued for normal operations and which will be fully
satisfied within six months after the date hereof, and except
certain other purchases for future delivery which are fully
covered by firm sales commitments from the Company's customers at
prices in excess of the Company's cost therefor, or contracts to
sell or supply products at fixed prices, or to perform services,
in excess of $50,000, except such sales commitments as are offset
by firm commitments from the Company's vendors at cost prices
below the Company's committed selling prices therefor;
(c) except such as have arisen in the normal
course of business of the Company, (i) contracts or commitments
continuing over a period of more than one year from the date of
this Agreement, (ii) representative or sales agency contracts and
commitments, (iii) leases under which it is either lessor or
lessee (except office space leased by the Company), (iv) pledges
for any charitable contributions, or (v) contracts or commitments
for capital expenditures in excess of $25,000;
(d) bonus, pension, profit sharing, retirement,
stock purchase, stock option, hospitalization, insurance,
vacation pay, or similar plan or practice, formal or informal, in
effect with respect to any of its employees;
(e) contract or commitment for the borrowing of
money or other agreement or arrangement for a line of credit; or
(f) material contract not made in the ordinary
course of business.
All of the contracts listed on Schedule 4.15 are valid,
binding and enforceable in accordance with their terms. The
Company has taken all action necessary to enable it to fulfill
when due, all of its obligations under each of such contracts.
All parties to such contracts have complied in all material
respects with the provisions thereof, no party is in default
thereunder and no notice of any claim of default has been given
to the Company. There are no provisions of, or developments
materially affecting, any such contract which might prevent the
Company from realizing the benefits thereof whether before or
after the completion of the transactions contemplated by this
Agreement.
4.16 Real Property. All real property (including,
without limitation, all interests and rights to real property)
and improvements located thereon which are owned or leased by the
Company are listed on the attached Schedule 4.16 (the "Real
Property"). The Company owns outright, and has good and
marketable title to, all of the owned Real Property or valid and
enforceable leasehold interest in all of the leased Real
Property, free and clear of all liens, except the defects, liens,
adverse claims and other matters affecting the Company's title
to, possession of, or leasehold interest in the Real Property,
expressly set forth on Schedule 4.16.
4.17 Transactions with Affiliates. Except as set forth
on Schedule 4.17, no shareholder or director or officer of the
Company, or any member of his or her immediate family or any
other of its, his or her affiliates, owns or has an ownership
interest in any corporation or other entity that is or was during
the last three years a party to, or in any property which is or
was during the last three years the subject of, contracts,
business arrangements or relationships of any kind with the
Company. All disclosed transactions between the Company and any
Seller or any affiliate have been on substantially the same terms
and conditions as similar transactions between non-affiliated
parties and are properly recorded on the books and records of the
Company.
4.18 Absence of Undisclosed Liabilities. There are no
material liabilities or obligations of the Company, known or
unknown, fixed or unfixed, liquidated or unliquidated, accrued,
absolute, contingent, or otherwise, including, but not limited
to, any tax liabilities due or to become due, and whether
incurred in respect of or measured by the net income of the
Company for any period prior the close of business on July 31,
1998 or arising out of transactions entered into, or any state of
facts existing, prior hereto, except:
(a) as disclosed or adequately reserved for or
against, in the Financial Statements of the Company as of July
31, 1998 and not heretofore paid or discharged, and
(b) as incurred, consistent with past business
practices, in or as a result of the normal and ordinary course of
business since July 31, 1998, and
(c) as set forth on Schedule 4.11.
4.19 Absence of Default. The Company is not in default
in the performance, observance, or fulfillment of any material
obligation, covenant, or condition contained in any debenture or
note, or contained in any conditional sale or equipment trust
agreement, or loan or other borrowing agreement to which the
Company is a party except as described in Schedule 4.19 hereof.
4.20 Existing Condition. Since July 31, 1998 there has
not been any material or adverse change in the Company, its
operations, business, or property, or in its financial condition,
operations, business, or property. Since July 31, 1998 there has
not been: (i) any damage, destruction, or loss, whether covered
by insurance or not, materially and adversely affecting the
operations, business, or property of the Company; (ii) any
declaration, setting aside, or payment of any dividend, or any
distribution in respect of capital stock of the Company, or any
redemption, purchase, or other acquisition of any of shares of
the Company.
4.21 Employment Agreements/Labor Matters. The Company
has no collective bargaining agreements with any labor union or
other representative or employees. No strike, slowdown,
picketing or work stoppage by any union or other group of
employees against the Company or the Company's assets wherever
located, and no secondary boycott with respect to their products,
lockout by them of any of their employees or any other labor
trouble or other occurrence, event or condition of a similar
character, has occurred or been threatened. The Company has no
Employee Benefit Plans. For purposes of this Agreement,
"Employee Benefit Plans" means "employee benefit plans" as
defined in Section 3(3) of the Employee Retirement Security Act
of 1974, as amended and any other plan, policy, program, practice
or arrangement providing compensation or other benefits to any
current or former officer or employee of the Company, or any
dependent or beneficiary thereof, which are now or have been
maintained by the Company, or any affiliate or under which the
Company or any affiliate has any obligation or liability, whether
actual or contingent, including, without limitation, all
incentive, bonus, deferred compensation, vacation, holiday,
medical, disability, share purchase or other similar plans,
policies, programs, practices or arrangements.
4.22 Restrictions. Other than as disclosed herein, the
Company is not subject to any charter or other corporate
restriction or any judgment, order, writ, injunction, decree,
rule, or regulation which materially and adversely affects or, so
far as the Seller can now foresee, may in the future materially
and adversely affect, the business, operations, prospects,
properties, assets, or condition, financial or otherwise, of the
Company.
4.23 Compliance with Laws. The operations of the
Company are not in material violation of any existing statute or
regulation of the United States of America or any country,
province, state, municipality, or agency in respect of the
conduct of its business and the maintenance and operations of its
properties; and, in particular, not declared to be in material
violation of any existing environmental, safety or health law,
rule, or regulation.
4.24 Directors, Officers, and Authorized Persons.
Schedule 4.24 sets forth a complete and accurate list of the
names and addresses of all directors of the Company, all officers
of the Company, all persons authorized to borrow on behalf of the
Company, all persons authorized to make withdrawals from bank or
checking accounts of the Company, and all persons having access
to safes, vaults, or safety deposit boxes in any bank in the name
of the Company. Schedule 4.24 also contains a complete and
accurate list, including the address or location, of all such
bank and checking accounts, safes, vaults, and safety deposit
boxes.
4.25 Corporate Records. The minute books of the
Company are current and contain correct and complete copies of
all charter documents of the Company, including all amendments
thereto and restatements thereof, and of all minutes of meetings,
resolutions and other actions and proceedings of its shareholders
and board of directors and all committees thereof, duly signed by
the Secretary or an Assistant Secretary, and the stock record
book of the Company is also current, correct and complete and
reflects the issuance of all of the Company Stock to the
Company's shareholders.
4.26 Disclosure. No representation or warranty made by
the Company or the Sellers in this Agreement contains any untrue
statement of material facts or omits to state any material fact
necessary to make any statement herein not misleading.
5. Indemnification, Limitations and Further Compensation.
Sellers and Company shall, jointly and severally, indemnify and
hold harmless Buyer as to the matters hereinafter set forth,
according to the procedures of this Section.
Buyer shall be indemnified as to the following matters:
(a) Any and all damages, losses, deficiencies,
liabilities, costs and expenses resulting from, relating to or
arising out of any breach of representation or warranty, non-
fulfillment of any agreement or covenant, omission or
misrepresentation hereunder;
(b) Any further contested liability for payment
of charges incurred in the operation of Company's business prior
to the date hereof, which liability is not to a creditor
identified in Schedule 4.15 for a service there stated or is not
otherwise identified on Schedule 4.11 or Schedule 6.3; and
(c) Any and all actions, suits, proceedings,
demands, judgments, costs, and related legal expenses reasonably
incurred, incident to any of the foregoing or to enforce this
Section 5.
Provided, however, that Sellers shall not be liable to Buyer
for any matter whatsoever, relating to this Agreement, or for any
other matter whatsoever, which matter is not set forth in a
written claim presented to Sellers within two (2) years of the
date hereof, setting forth the claim and amount thereof in full
detail.
Before Buyer may assert a claim for indemnity or loss, Buyer
must promptly submit, give or cause to be given to Sellers,
written notice of the claimed amount and the basis therefore.
Sellers shall have the right to contest, defend or settle any
claim with any third party at Sellers' own and sole expense
through counsel of Sellers' own choice, in Sellers' own name or
the name of the Buyer; provided, however, that any election by
Sellers to settle or compromise a claim with any third party
shall be subject to the advance written approval of Buyer.
Sellers shall have fifteen (15) days after Buyer shall have given
notice of the claim to elect and commence to transmit notice to
Buyer of whether or not Sellers shall contest, defend, settle, or
compromise any such claim or liability.
6. Representations and Warranties of Buyer to Seller.
Buyer represents and warrants to Seller that:
6.1 Organization, Good Standing, and Authority. Buyer
is a corporation duly organized, validly existing, and in good
standing under the laws of the State of Maryland and has full
corporate power and authority to own its properties and assets
and to carry on its business as it has been and is conducted. The
execution and delivery of this Agreement and the consummation of
the transactions contemplated hereby are within the corporate
powers of Buyer and have been duly authorized by all necessary
corporate and other actions, and the undertakings and obligations
of Buyer hereunder are valid, binding, and enforceable in
accordance with their terms.
6.2 Validity of Contemplated Transactions. Neither
the execution and delivery of this Agreement nor the consummation
of the transaction provided herein will violate any agreement to
which Buyer is a party or by which it is bound, or any law,
order, or decree or any provision of the Articles of
Incorporation or By-Laws of Buyer.
6.3 Assumption of Obligations and Liabilities. Buyer
represents and warrants that it is assuming all financial
obligations, responsibilities and liabilities of the Company.
Buyer represents and warrants that it shall hold Sellers and
their directors and officers harmless from any further
obligations, responsibility or liability pertaining thereto and
indemnify Sellers and their officers and directors against any
legal expenses, including reasonable attorneys fees, which
Sellers and their officers and directors may incur as a result of
Buyer's breach of this provision; provided, however, that in no
event shall Buyer have an obligation to hold Sellers and their
directors and officers harmless and provide indemnification
hereunder to the extent that such liability arises from
obligations, responsibilities and liabilities of the Company that
have not been disclosed to Buyer or from a breach of any
representation or warranty or covenant of the Sellers or the
Company.
6.4 Disclosure. To the best knowledge of Buyer, no
representation or warranty made by it in this Agreement contains
any untrue statement of material facts or omits to state any
material fact necessary to make any statement herein not
misleading.
7. Broker and Finder's Fees. Sellers and the Company
represent and warrant to Buyer that they have not engaged or
dealt with any broker or other person who may be entitled to any
brokerage fee, commission or other payment (other than attorney's
fees) in respect of the execution of this Agreement or the
consummation of the transactions contemplated hereby. Buyer
represents and warrants to Seller that neither it nor any
corporate affiliate has engaged or dealt with any broker or other
person who may be entitled to any brokerage fee or commission in
respect of the execution of this Agreement or the consummation of
the transactions contemplated hereby.
Each of the parties hereto shall indemnify and hold the
others harmless against any and all claims, losses, liabilities,
or expenses which may be asserted against such other parties as a
result of such first-mentioned party's dealings, arrangements, or
agreements with any such broker or person.
8. Non-Competition/Non-Solicitation.
8.1 From the date hereof until the end of the fifth
year following the date hereof (the "Noncompete Period"), PSC
agrees that it will not, without the prior written consent of the
Buyer, directly or indirectly (whether as a partner, venturer,
shareholder, director, or in any other capacity as principal or
agent or through any person, corporation, partnership, entity
or employee acting as nominee or agent) conduct or engage in or
be interested in or associated with any person, firm,
association, syndicate, partnership, company, corporation, or
other entity which conducts or engages in the international
telecommunications business in any geographic areas in which
Buyer or any subsidiary of Buyer is then so engaged in business
or proposes to engage in business in accordance with its
then-current strategic plan, nor shall PSC interfere with,
disrupt or attempt to disrupt the relationship, contractual or
otherwise, between Buyer or any of its subsidiaries, on the one
hand, and any customer, supplier, lessor, lessee or employee of
the Buyer or any of its subsidiaries, on the other hand;
provided, however, that this Section 8.1 shall not prohibit PSC
from owning beneficially or of record not more than 5% of the
outstanding equity securities of any entity whose equity
securities are registered under the Securities Exchange Act of
1934, as amended, or are listed for trading on any United States
or foreign stock exchange.
8.2 It is the desire and intent of the parties that
the provisions of this Section 8 shall be enforced to the full
extent permissible under the laws and public policies applied in
each jurisdiction in which enforcement is sought. Accordingly,
if any particular portion of this Section 8 shall be adjudicated
to be invalid or unenforceable, this Section 8 shall be deemed
amended to delete therefrom the portion thus adjudicated to be
invalid or unenforceable, such deletion to apply only with
respect to the operation of this paragraph in the particular
jurisdiction in which such adjudication is made. Further, the
provision that is determined to be invalid, illegal or
unenforceable shall be reformed and construed to the extent
permitted by law so that it will be valid, legal and enforceable
to the maximum extent possible.
9. Survival of Representations and Warranties. All
representations, indemnifications, warranties, and agreements
made by Buyer and Sellers in this Agreement or pursuant hereto
shall survive the date of this Agreement for a period of two (2)
years. Notwithstanding any investigation or audit conducted
before or after the date hereof, the parties shall be entitled to
rely upon the representations and warranties set forth in this
Agreement.
10. Expenses. Sellers shall bear the expenses incurred by
them in connection with the consummation of the transactions
contemplated by this Agreement; Company shall bear its own
expenses; and Buyer shall likewise bear its expenses. The
reasonable expenses of the Company under this Section 10 shall
not be considered in determining whether there is any reduction
in Sellers' equity or in the Company's earnings or in testing any
representation, warranty, or agreement of Seller.
11. Further Actions and Assurances. Buyer, the Company and
Sellers shall execute and deliver any and all documents, and
shall cause any and all other action to be taken after the date
hereof, which may be necessary or proper to effect or evidence
the provisions of this Agreement and the transactions
contemplated hereby.
12. Counterparts. This Agreement may be executed in
several counterparts each of which is an original and any Seller
may become a party hereto by executing a counterpart hereof. This
Agreement and any counterpart so executed shall be deemed to be
one and the same instrument.
13. Contents of Agreement; Parties in Interest. This
Agreement sets forth the entire understanding of the parties. Any
previous agreements or understandings between the parties
regarding the subject matter hereof are merged into and
superseded by this Agreement. This Agreement may not be amended
except by a writing executed by the party to be charged with the
amendment. All representations, warranties, covenants, terms
conditions, and provisions of this Agreement shall be binding
upon and inure to the benefit of and be enforceable by the
respective heirs, legal representatives, successors, and
permitted assigns of Seller and Buyer.
14. Governing Law. THIS AGREEMENT SHALL BE GOVERNED IN ALL
RESPECTS, INCLUDING VALIDITY, INTERPRETATION AND EFFECT, BY THE
LAWS OF THE STATE OF MARYLAND, WITHOUT GIVING EFFECT TO THE
CONFLICTS OF LAWS PROVISIONS THEREOF. ALL OF THE PARTIES HERETO
HEREBY IRREVOCABLY AND UNCONDITIONALLY CONSENT TO SUBMIT TO THE
EXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF MARYLAND AND
OF THE UNITED STATES LOCATED IN THE STATE OF MARYLAND (THE
"MARYLAND COURTS"), FOR ANY LITIGATION ARISING OUT OF OR RELATING
TO THIS AGREEMENT, WAIVE ANY OBJECTION TO THE LAYING OF VENUE OF
ANY SUCH LITIGATION IN THE MARYLAND COURTS AND AGREES NOT TO
PLEAD OR CLAIM THAT SUCH LITIGATION BROUGHT IN ANY MARYLAND COURT
HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. EACH PARTY AGREES TO
ACCEPT SERVICE OF PROCESS IN THE MANNER OF THE GIVING OF NOTICES
STATED HEREIN IN SECTION 18 AND CONSENTS TO THE IN PERSONAM
JURISDICTION OF THE MARYLAND COURTS TO HEAR AND RESOLVE ANY
DISPUTE INVOLVING OR ARISING FROM THIS AGREEMENT.
15. Section Headings and Gender. The section headings
herein have been inserted for convenience of reference only and
shall in no way modify or restrict any of the terms or provisions
hereof. The use of the masculine pronoun herein when referring to
any party has been for convenience only and shall be deemed to
refer to the particular party intended regardless of the actual
gender of such party.
16. Schedules. All schedules referred to in this Agreement
are intended to be and are hereby specifically made a part of
this Agreement.
17. Severability. Any provision of this Agreement which is
found to be invalid or unenforceable by a court of competent
jurisdiction shall be ineffective to the extent of such
invalidity or unenforceability without invalidating or rendering
unenforceable the remaining provisions hereof, and any such
invalidity or unenforceability shall not invalidate or render
unenforceable such provision in any other jurisdiction.
18. Notices. All notices which are required or permitted
hereunder shall be sufficient if given in writing and delivered
personally or by registered or certified mail, postage prepaid,
as follows (or to such other addressee as shall be set forth in a
notice given in the same manner):
If to Buyer:
Startec Global Communications Corporation
00000 Xxxxx Xxxx Xxxxx
Xxxxxxxx, Xxxxxxxx 00000
Attn: Xxxxxxx X. Xxxxxxx, Senior Vice President
and Chief Financial Officer
with a copy to:
Xxxxxx X. Xxxxxx, Esq.
Xxxxxxxx Xxxxxxxx Xxxxx & Xxxxx LLP
0000 Xxx Xxxxxx, XX, 00xx Xxxxx Xxxx
Xxxxxxxxxx, XX 00000
If to Sellers:
Xxxxxx X. Xxxxxxx
Chairman/CEO
Pacific Systems Corporation
000 Xxxxxx Xxxxx Xxxx
Xxxxx, Xxxx 00000
with a copy to:
Xxxxxx X. Van de veld, Esq.
The Vandeveld Law Offices, P.C.
Union Bank Building, Suite 213
000 Xxxxxx Xxxxxx Xxxxxx
Xxxxx, Xxxx 00000
The Sellers hereby appoint Xxxxxx X. Xxxxxxx as their
representative and attorney-in-fact for the purpose of delivering
and receiving notices pursuant to this Agreement.
19. Assignment. The rights and obligations of Sellers
under this Agreement may not be assigned without the consent of
Buyer; provided, however, that Buyer may assign its rights and
obligations under this Agreement to any affiliate or direct or
indirectly owned subsidiary.
20. Confidential Information. Notwithstanding any
termination of this Agreement, Buyer and its representatives
agree to hold in confidence any information not generally
available to the public received by them from the Company or
Sellers pursuant to the terms of this Agreement. If this
Agreement is terminated for any reason, Buyer and its
representatives will continue to hold such information in
confidence and will, to the extent requested by the Company,
promptly return to the Company all written material and
all copies or abstracts thereof furnished to Buyer pursuant
hereto. Notwithstanding any termination of this Agreement,
Sellers, the Company, and their representatives agree to hold in
confidence any information not generally available to the public
received by them from the Buyer pursuant to the terms of this
Agreement. If this Agreement is terminated for any reason,
Sellers, the Company, and their representatives will continue to
hold such information in confidence and will, to the extent
requested by Buyer, promptly return to Buyer all written material
and all copies or abstracts thereof given to the Company, or
Sellers, or their representatives pursuant hereto.
IN WITNESS WHEREOF, the parties hereby acknowledge that they
have read the foregoing Agreement and each has been independently
advised as to the terms hereof by their own separate counsel and
by the execution hereof below, consent to be bound by the terms
of this Agreement.
BUYER:
STARTEC GLOBAL COMMUNICATIONS CORPORATION
_________________________
By: Xxxxxxx X. Xxxxxxx
Its: Senior Vice President and Chief Financial Officer
Date:
SELLERS:
PACIFIC SYSTEMS CORPORATION, a Commonwealth of
Northern Mariana Islands corporation
_________________________
By: Xxxxxx X. Xxxxxxx
Its: Chairman and Chief Executive Officer
Date:
__________________________
Xxxx Day
Date:
__________________________
Xxxxxx X. Xxxxxxx
Date:
COMPANY:
PCI COMMUNICATIONS, INC., a Guam corporation
_________________________
By: Xxxxxx X. Xxxxxxx
Its: Chairman and Chief Executive Officer
Date:
List of Exhibits
Exhibit A Additional Sellers
Exhibit B Escrow Agreement
Exhibit C Xxxxxxx Employment Agreement
Exhibit D Day Employment Agreement
Exhibit E Lease for Guam Office Space
List of Schedules
Schedule 2.3(a) Adjustment Exclusions
Schedule 2.3(c) Tax Reserve Amounts
Schedule 3.7 PSC Employees
Schedule 4.5 Restrictions
Schedule 4.8(a) Financial Statements
Schedule 4.8(b) Fixed Assets
Schedule 4.9(a) Company Assets
Schedule 4.9(b) PSC Assets
Schedule 4.11 Litigation and Reserved Amounts
Schedule 4.12 Insurance
Schedule 4.13(a) Licenses
Schedule 4.13(b) Renewability of Licenses
Schedule 4.15 Contracts and Commitments
Schedule 4.16 Real Property
Schedule 4.17 Affiliate Transactions
Schedule 4.19 Defaults
Schedule 4.24 Directors and Officers
