EXHIBIT 10.1
ADDENDUM NO. 1
WHEREAS, Wavetech, Inc., which was subsequently renamed Wavetech
International, Inc. ("Wavetech"), Wavetech Interim, Inc. ("Interim") and
Imagitel, Inc. ("Imagitel") entered into that certain Reorganization Agreement,
dated as of January 5, 1998 (the "Agreement") and Plan of Merger attached
thereto (the "Plan of Merger") pursuant to which Wavetech will acquire Imagitel
through the merger of Interim with and into Imagitel;
WHEREAS, Section 11.8 permits the parties to amend the Agreement in
writing;
WHEREAS, the parties did execute that certain Addendum as of June 15, 1998
in order to amend the terms and conditions on which the Merger shall occur;
WHEREAS, such Addendum unintentionally contained certain errors; and
WHEREAS, the parties to the Agreement desire to herein correct such errors
and properly amend the terms and conditions on which the Merger shall occur.
NOW THEREFORE, the parties to the Agreement do agree to the following
provisions, which shall be deemed incorporated into the Agreement as if fully
set forth herein.
1. AMENDMENTS TO AGREEMENT. In order to reflect the changes to the
Agreement intended to be effectuated by this Addendum, the parties do hereby
amend Sections 2.2, 3.4 (previously misnumbered Section "3.1 CAPITALIZATION OF
IMAGITEL"), 4.4, 5.2 and 8.2 by deleting them in their entirety and replacing
them with the following, respectively:
2.2 THE CLOSING. The Closing of the transaction contemplated
herein shall be held as soon as reasonably practicable after
fulfillment of all conditions set forth in Article 7 and Article
8 hereof (the "Closing Date"), at the offices of Imagitel located
at 0000 Xxxxxxx Xxxxx, Xxxxx 0000, Xxxxxxx, Xxxxx 00000, or at
such other place and time as the parties hereto may mutually
agree; provided, however, that in the event that Closing has not
occurred by August 31, 1998, either party hereto shall have the
right to terminate this Reorganization Agreement.
3.4 CAPITALIZATION OF IMAGITEL. The authorized capital stock
of Imagitel consists solely of (i) 1,000,000 authorized shares of
common stock (no par value), of which 200,000 shares are issued
and outstanding. All of the issued and outstanding shares of
Imagitel are validly issued and fully paid and nonassessable.
Except for the items set forth on Schedule 3.4 attached hereto or
expressly referenced elsewhere herein, there are no outstanding
obligations, options, warrants or commitments of any kind or
nature or any outstanding securities or other instruments
convertible into shares of any class of capital stock of
Imagitel, or pursuant to which Imagitel is or may become
obligated to issue any shares of its capital stock. None of the
shares of the Imagitel Common Stock is subject to any
restrictions as to the transfer thereof, except as set forth in
Imagitel's Certificate of Incorporation or Bylaws and except for
restrictions on account of applicable federal or state securities
laws. Imagitel does not hold any equity securities of any other
company or legal entity except for shares of RRV Enterprises,
Inc., a Texas corporation, and DDD Calling, Inc., a Texas
corporation, Zapcom International, Inc., a Nevada corporation and
Comac Interim, Inc., a Delaware corporation. Imagitel, Inc. owns
100% of the outstanding shares of capital stock of such
subsidiaries and there are no outstanding obligations, options,
warrants or commitments of any kind or nature or any outstanding
securities or other instruments convertible into shares of any
class of capital stock of such subsidiaries.
4.4 CAPITALIZATION OF WAVETECH. The authorized capital stock
of Wavetech consists solely of (i) 50,000,000 authorized shares
of common stock ($0.001 par value), of which 16,994,976 are
issued and outstanding as of June 15, 1998, and (ii) 10,000,000
shares of preferred stock, of which 600 shares of Series A
Preferred Stock were issued and outstanding as of June 15, 1998.
All of the issued and outstanding shares of Wavetech are validly
issued and fully paid and nonassessable. Except for the items set
forth on Schedule 4.4 hereto, there are no outstanding
obligations, options, warrants or commitments of any kind or
nature or any outstanding securities or other instruments
convertible into shares of any class of capital stock of
Wavetech, or pursuant to which Wavetech is or may become
obligated to issue any shares of its capital stock. None of the
shares of the Wavetech Common Stock is subject to any
restrictions as to the transfer thereof, except as set forth in
Wavetech's Certificate of Incorporation or Bylaws and except for
restrictions on account of applicable federal or state securities
laws. Except for Interim (which is wholly-owned by Wavetech),
Wavetech does not hold 10% or more of any class of equity
securities of any other company or legal entity, except for those
wholly-owned subsidiaries disclosed in Wavetech's public SEC
filings. The authorized capital stock of Interim consists solely
of (i) 10,000 authorized shares of common stock ($1.00 par
value), of which 100 shares are issued and outstanding. All of
the issued and outstanding shares of Interim are validly issued
and fully paid and nonassessable. Except for the items set forth
on Schedule 4.4 hereto, there are no outstanding obligations,
options, warrants or commitments of any kind or nature or any
outstanding securities or other instruments convertible into
shares of any class of capital stock of Interim, or pursuant to
which Interim is or may become obligated to issue any shares of
its capital stock.
5.2 CONDUCT OF WAVETECH PENDING CLOSING. During the period
commencing on the date hereof and continuing until the Closing
Date, Wavetech covenants and agrees to the following (except to
the extent that Imagitel shall otherwise expressly consent in
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writing); provided, however, that any breach of any of the
covenants given in this Section 5.2 must be material in the
aggregate with respect to the business of Wavetech before such
breach shall be actionable or shall constitute grounds for
termination or failure to perform under this Reorganization
Agreement.
(a) Wavetech will carry on its business only in the ordinary
course in substantially the same manner as heretofore conducted
and, to the extent consistent with such business, use all
reasonable efforts to preserve intact its business organization,
maintain the services of its present officers and employees and
preserve its relationships with customers, suppliers and others
having business dealings with it so that its goodwill and going
business shall be unimpaired at the Closing Date.
(b) Wavetech will not amend its Certificate of Incorporation
or Bylaws as in effect on the date hereof.
(c) Except for:
(i) the issuance of capital stock in connection with
items set forth on Schedule 4.4 hereto, and
(ii) the issuance of shares in connection with capital
raising transactions which are otherwise acceptable to Imagitel.
Wavetech will not issue, grant, pledge or sell, or authorize the
issuance of, reclassify or redeem, purchase or otherwise acquire,
any shares of its capital stock of any class or any securities
convertible into shares of any class, or any rights, warrants or
options to acquire any such shares (except for employee stock
options in the ordinary course in accordance with past practice
and only upon prior notice to Wavetech); nor will it enter into
any arrangement or contract with respect to the issuance of any
such shares or other convertible securities; nor will it declare,
set aside or pay any dividends (of any type) or make any other
change in its equity capital structure.
(d) Wavetech will promptly advise Imagitel orally and in
writing of any change in the businesses of Wavetech that is or
may reasonably be expected to be materially adverse to the
business of Wavetech.
(e) Wavetech will not take, agree to take, or knowingly
permit to be taken any action or do or knowingly permit to be
done anything in the conduct of the business of Wavetech, or
otherwise, which would be contrary to or in breach of any of the
terms or provisions of this Reorganization Agreement, or which
would cause any of the representations of Wavetech contained
herein to be or become untrue in any material respect.
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(f) Wavetech will not incur any indebtedness for borrowed
money, issue or sell any debt securities, or assume or otherwise
become liable, whether directly, contingently or otherwise, for
the obligation of any other party, other than in the ordinary
course of business.
(g) Except for expenses attendant to the Merger and current
contractual obligations, Wavetech will not incur any expense in
an amount in excess of $25,000 after the execution of this
Reorganization Agreement without the prior written consent of
Imagitel.
(h) Wavetech will not grant any executive officers any
increase in compensation (except in the ordinary course in
accordance with past practice and only upon prior notice to
Imagitel), or enter into any employment agreement with any
executive officer without the consent of Imagitel except as may
be required under employment or termination agreements in effect
on the date hereof which have been previously disclosed to
Imagitel in writing.
(i) Wavetech will not acquire or agree to acquire by merging
or consolidating with, purchasing substantially all of the assets
of or otherwise, any business or any corporation, partnership,
association or other business organization or division thereof.
8.2 INTENTIONALLY OMITTED.
2. AMENDMENTS TO PLAN OF MERGER. In order to reflect the changes to
the Plan of Merger intended to be effectuated by this Addendum, the parties do
hereby amend Sections 3.1 and 5.1 by deleting them in their entirety and
replacing them with the following, respectively:
3.1 MERGER CONSIDERATION. (a) In connection with the Merger,
each Imagitel shareholder shall, by virtue of the Merger and
without any action on his part, be entitled to receive 32.99
shares of Wavetech Common Stock for each share of Imagitel Common
Stock issued and outstanding immediately prior to the Effective
Time (the "Conversion Ratio"); provided, however, that in no
event shall Wavetech issue more than an aggregate of 7,922,861
shares of Wavetech Common Stock in connection with the Merger
(including shares issuable upon the exercise of Imagitel Options
which shall be converted into options, warrants or other rights
to acquire Wavetech Common Stock pursuant to Section 5.1 hereof).
The Conversion Ratio already gives effect to the one-for-six
reverse split approved by the Wavetech stockholders at a special
meeting held on May 26, 1998.
(b) neither the Conversion Ratio, nor the Conversion Value
of Imagitel nor the maximum aggregate number of shares of
Wavetech Common Stock issuable in connection with the Merger (as
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set forth in (a) above) shall change if Imagitel acquires
Accommodation Services, Inc. prior to the Effective Time,
although the number of outstanding shares of Imagitel will
increase.
5.1 OPTIONS AND WARRANTS. At the Effective Time, all
options, warrants and other rights to purchase or acquire shares
of Imagitel Common Stock (collectively "Imagitel Options") shall
represent options, warrants or such other rights to purchase or
acquire a number of shares of Wavetech Common Stock, determined
in accordance with the Conversion Ratio. All other terms and
conditions of such Imagitel Options shall be unaffected by such
change.
3. INCORPORATION. Except as otherwise provided in this Addendum, the
parties hereto hereby confirm their intent to be bound by the terms and
conditions of the Agreement. This Addendum shall supersede that certain
Addendum, executed as of June 15, 1998, and shall be construed in accordance
with the purposes and intents of the Agreement.
4. DEFINED TERMS. All capitalized terms used in this Addendum shall have
the respective meanings ascribed to them in the Agreement.
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IN WITNESS WHEREOF, the parties hereto have evidenced their agreement
to the terms set forth herein by their signature below, as of this 15th day of
June, 1998.
ATTEST: WAVETECH INTERNATIONAL, INC.
/s/ Xxxxxxx X. Xxxxxxx By: /s/ Xxxxxx X. Xxxxx
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Secretary Title: President
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ATTEST: WAVETECH INTERIM, INC.
/s/ Xxxxxxx X. Xxxxxxx By: /s/ Xxxxxx X. Xxxxx
-------------------------------- -----------------------------------
Secretary Title: President
--------------------------------
ATTEST: IMAGITEL, INC.
/s/ Xxxxxxx X. Xxxxxxx By: /s/ Xxxxx X. Xxxxxxxx XX
-------------------------------- -----------------------------------
Secretary Title: President
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