EXHIBIT 10.6
AMENDMENT AGREEMENT
THIS AMENDMENT AGREEMENT (this "Agreement") is made as of January 13, 1999,
by and among TELEVAR ACQUISITION CORP., a Washington corporation
("Acquisition"), BOSS INTERNET GROUP, INC., a Washington corporation ("Boss"),
[TELEVAR, INC.], a Washington corporation ("Televar") and ORCA TECHNOLOGIES,
INC., a Utah corporation ("Orca").
WHEREAS, Televar, Orca Acquisition and Tel-Sub Corp., a wholly-owned
subsidiary of Acquisition which has been merged with and into Acquisition
("Acquisition Sub"), are parties to that certain Asset Purchase Agreement, dated
as of September 28, 1998 (the "Purchase Agreement"), pursuant to which
Acquisition, through Acquisition Sub, acquired substantially all of the assets,
and assumed certain designated liabilities, of Televar; and
WHEREAS, in connection with the Purchase Agreement, Acquisition Sub and
Boss executed an Assumption of Liabilities (the "Assumption Agreement"),
pursuant to which Acquisition Sub assumed those liabilities of Televar
designated as "Assumed Liabilities" therein, and Boss guaranteed payment of all
such liabilities; and
WHEREAS, certain liabilities of Televar were not included in the designated
liabilities assumed by Acquisition Sub pursuant to the Purchase Agreement and
the Assumption Agreement and, therefore, remain liabilities of Televar and Orca
(the "Excluded Liabilities"); and
WHEREAS, the Excluded Liabilities include, among others, (a) all
liabilities and obligations relating to that certain lawsuit between Televar and
Advanced Data Systems, Inc., Xxxxxxxxxxx Xxxxxxx and Xxxxx Xxxx (collectively,
"ADS"), filed in Chelan County Superior Court, and certain agreements entered
into between ADS and Televar (the "ADS Dispute"), and (b) all liabilities and
obligations relating to an action filed by Televar against Xxxxxxx Computers,
Inc. ("Xxxxxxx") and certain agreements entered into between Televar or Orca and
Xxxxxxx (the "Xxxxxxx Dispute"); and
WHEREAS, Acquisition has paid, on Televar's behalf, certain amounts owed by
Televar to Xxxxxxx; and
WHEREAS, the parties to the ADS Dispute and Acquisition propose to enter
into a settlement agreement in that dispute, and in aid of effecting this
settlement, Acquisition has agreed to pay, on Televar's behalf, certain amounts
payable to ADS in connection therewith; and
WHEREAS, in consideration of Acquisition paying certain amounts owed to
Xxxxxxx and as a condition to Acquisition paying certain amounts payable in
connection
with the settlement of the ADS Dispute, the parties have agreed to amend the
Purchase Agreement and the Assumption Agreement in the manner set forth below.
NOW THEREFORE, in consideration of the covenants in this Agreement, the
parties agree as follows:
1. Assumption Agreement Amendment. Schedule A to the Assumption Agreement
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is hereby amended and restated in its entirety to read as the Amended Schedule A
attached hereto. In connection therewith, the Purchase Agreement is also amended
by replacing the Assumption Agreement attached as Exhibit B thereto with the
Assumption Agreement as so amended hereby.
2. Settlement of ADS Litigation. On the terms and subject to the
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conditions set forth below and elsewhere in this Agreement, Acquisition agrees
to pay to ADS, on behalf of Televar, an aggregate amount of $28,000 (the "ADS
Settlement Amount"), pursuant to that certain Confidential Settlement Agreement,
dated January 19, 1999, by and among ADS, Orca, Televar, and Acquisition (the
"ADS Settlement Agreement"), and to enter into the ADS Settlement Agreement;
provided that Acquisition's only participation in the ADS Settlement Agreement
is to consent to termination of that certain Exclusive Sales Agency Agreement
between Televar and ADS which was assigned to Acquisition pursuant to the
Purchase Agreement. The agreement of Acquisition to pay the ADS Settlement
Amount and to enter into the ADS Settlement Agreement is conditioned upon the
following:
(a) agreement by all parties as to the identity of the trade accounts
payable to be removed from Schedule A to the Assumption Agreement and execution
of this Agreement by Orca and Televar;
(b) execution by Orca and Televar of the ADS Settlement Agreement and
performance of all obligations to be performed by them thereunder; and
(c) settlement by Televar and Orca of the Xxxxxxx Dispute in a manner
reasonably satisfactory to Acquisition which shall include, without limitation,
(i) cancellation of, and release of Xxxxxxx and all of its affiliates from, all
obligations of Xxxxxxx or any of its affiliates owed to Televar, Orca or any of
their affiliates, (ii) return of all promissory notes or other evidences of
indebtedness issued to Televar, Orca or any of their affiliates by Xxxxxxx or
any of its affiliates, marked "canceled" and (iii) release of any security
interest granted by Xxxxxxx or any of its affiliates in connection with any such
canceled or released obligations.
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2. Miscellaneous
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(a) Assignment: Benefit. No party may voluntarily or involuntarily
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assign its interest under this Agreement without the prior written consent of
the other parties. Subject to the foregoing, this Agreement shall be binding
upon and shall inure to the benefit of the parties and their respective
successors and assigns.
(b) Amendment; Waiver. The provisions of this Agreement, or of any
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agreement or document executed in connection with this Agreement, may be amended
or waived only in writing by the party against which enforcement of such
amendment or waiver is sought.
(c) Severability. If any portion of this Agreement is held to be
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invalid by a court of competent jurisdiction, the remaining terms of this
Agreement shall remain in full force and effect to the extent possible.
(d) Governing Law. The construction and performance of this Agreement
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will be governed by the laws of the State of Washington (except for the choice
of law provisions thereof). Any litigation or arbitration proceeding between
the parties concerning this Agreement or the duties, obligations or actions of
any party hereunder shall be filed in the State of Washington.
(e) Counterparts. This Agreement may be executed in any number of
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counterparts, each of which shall be enforceable against the parties actually
executing such counterparts, and all of which together shall constitute one
instrument.
(f) Continuance of Purchase Agreement and Assumption Agreement.
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Except as otherwise expressly modified herein, the terms of the Purchase
Agreement and the Assumption Agreement (i) are not amended, modified or altered
in any way and (ii) shall remain in full force and effect.
(g) Defined Terms. Capitalized terms used herein and not otherwise
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defined shall have the meanings ascribed to them in the Purchase Agreement.
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Executed on the date first written above.
TELEVAR ACQUISITION CORP.,
a Washington corporation
By:________________________
Its:_______________________
BOSS INTERNET GROUP, INC.,
a Washington corporation
By:________________________
Its:_______________________
TELEVAR, INC.,
a Washington corporation
By:________________________
Its:_______________________
ORCA TECHNOLOGIES, INC.,
a Utah corporation
By:________________________
Its:_______________________
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AMENDED SCHEDULE A
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ASSUMED LIABILITIES
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1) Up to $514,000 of those Trade Accounts Payable on the list previously
provided by Televar as of September 28, 1998 (other than the payables to
Stoel Rives (which is approximately in the amount of $10,706), Expansion
Systems (which is approximately in the amount of $4,012) and Cisco (which
is approximately in the amount of $14,834))
2) Accrued line charges, not to exceed $145,000.
3) Accrued commissions payable, not to exceed $28,000.
4) Accrued vacation payable, not to exceed $10,500.
5) Accrued interest payable (excluding any amounts due to Orca) not to exceed
$25,000.
6) Note payable to GMAC.
7) Lease payable to Comdisco in the amount of $337,384.
8) Lease payable to Sanwa Leasing in the amount of $9,537.
9) Lease payable to Summit Leasing in the amount of $44,547.
10) Lease payable to Financial Pacific in the amount of $16,278.
11) Lease payable to Colonial Pacific Leasing, Cascade Leasing, in the amount
of $42,728.
12) Pro rata share of rent in Bothell place on a month-to-month basis from and
after the Closing Date.
13) Wenatchee office lease from and after the Closing Date.
14) Leases/rents @ P.O.P. sites from and after the Closing Date.
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