EXHIBIT 10.37
August 9, 1999
STOCK PURCHASE AGREEMENT
THIS AGREEMENT, made and entered into as of this 9th day of August,
1999, by and between UTG Communications International, Inc., Xxxxxxxxxxxx. 00,
XX-0000 Xxxxxxxxxx, Xxxxxxxxxxx, a Delaware corporation (the "Company"), and
Xxxxxx Xxxxx, X.X. Xxx 00, XX-0000 Xxxxxxxxxx, (the "Seller");
W I T N E S S E T H :
WHEREAS, the Seller owns 51 shares of common stock, CHF 1000 par value
(the "Common Stock"), of Music Line AG, a Swiss corporation ("Music Line");
WHEREAS, Music Line is engaged in the distribution of music CDs and
videotapes in Europe through various sales channels;
WHEREAS, the Seller desires to sell to the Company, and the Company
desires to buy from the Seller, 51 shares Common Stock of Music Line
representing 51% of the issued and outstanding shares of Common Stock of Music
Line;
WHEREAS, certain capitalized terms used herein shall have the
meaning given to them in Article X;
NOW, THEREFORE, in consideration of the mutual representations,
warranties, covenants and agreements contained herein, and upon the terms and
subject to the conditions hereinafter set forth, the parties hereby agree as
follows:
ARTICLE I
TERMS OF PURCHASE AND SALE
1.1 Purchase and Sale of Shares of Music Line. Subject to the terms
and conditions set forth herein, the Seller shall sell to the Company, and the
Company shall purchase from the Seller, 51 (fifty-one) shares of Common Stock
for USD 6 million (the "Purchase Price") consisting of a fixed amount (the
"Fixed Amount") and a bonus amount (the "Bonus Amount") to be payable on the
dates and in the manner set forth in Section 1.3 below.
1.2 The Closing. Subject to the satisfaction or waiver of all
conditions set forth in Articles VI and VII hereof, the Seller will transfer 51
(fifty-one) shares of Common Stock (the "Shares") to the Company, and the
Company will pay to the Seller the Purchase Price in the manner set forth in
Section 1.3(a) (the "Closing"). The Closing shall take place on the first
business day following satisfactory waiver of all of the Closing conditions set
forth in Articles VI and VII (the "Closing Date") at the offices of the Company
in Geroldswil, Switzerland at 1000 A.M. or at such other place and time as the
parties may mutually agree. At the Closing, the parties hereto shall deliver
such consideration set forth below and duly executed copies of this Agreement.
The Closing shall be deemed to have taken place at 5:00 P.M. on the Closing
Date.
1.3 Payment of Purchase Price and Transfer of Shares.
(a) The Company shall pay to the Seller the Fixed Amount of the
Purchase Price as follows:
(i) At the Closing, the Company shall (A) assign to the Seller all of its
right, title and interest in that certain accounts receivables in the
principal amount of USD 790,000; and (B) issue to the Seller 1,750,000
shares of its common stock, USD 0.0001 par value (the "Company Common
Stock").
(ii) If Music Line and its Subsidiaries shall have reached a net profit of
at least USD 300,000 during the fiscal year ended March 31, 2000 or the
fiscal year ended March 31, 2001, the Company shall pay to the Seller the
Bonus Amount of the Purchase Price by issuing to the Seller an additional
350,000 shares of Company Common Stock.
(b) At the Closing, the Company shall assign to the Seller the
receivables set forth in Section 1.3(a)(i)(A) and transfer to the Seller one or
more stock certificates representing 1,750,000 shares of Company Common Stock.
Upon confirmation that the Fixed Portion of the Purchase Price has been fully
paid in the manner set forth above, the Shares and certificate(s) therefor shall
be promptly released to the Company.
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF THE SELLER
The Seller hereby represents and warrants to the Company as follows
as of the date hereof and as of the Closing Date:
2.1 Corporate Existence of Music Line, Etc. Music Line is a
corporation duly incorporated, validly existing and in good standing under the
laws of Switzerland and has all requisite corporate power and authority to own
or lease its assets and to operate its business as presently conducted.
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ss.
2.2 Valid and Binding Obligation of Seller. This Agreement has been
duly executed and delivered on behalf of the Seller, constitutes the valid and
binding obligation of the Seller and is enforceable against the Seller in
accordance with its terms, subject to general equitable principles and except as
the enforceability thereof may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws of general application relating
to creditors' rights.
2.3 Capitalization. The share capital of Music Line consists of CHF
100,00, divided into 100 shares of Common Stock, CHF 1000 par value. All
outstanding shares of Common Stock have been duly authorized and are validly
issued, fully paid and non-assessable without violating any preemptive rights.
Except as contemplated by this Agreement, there is not outstanding any security,
option, warrant, right, call, subscription, agreement, commitment or
understanding of any nature whatsoever, fixed or contingent, that directly or
indirectly (i) calls for the issuance, sale, pledge or other disposition of any
shares of Common Stock or of any other shares of capital of Music Line or any
Subsidiary of Music Line or any securities convertible into, or other rights to
acquire, any such shares of Common Stock or other capital stock of Music Line or
any Subsidiary of Music Line or (ii) obligates Music Line or any Subsidiary of
Music Line to grant, offer or enter into any of the foregoing or (iii) relates
to the voting or control of such shares of Common Stock, capital stock,
securities or rights, or options with respect thereto.
2.4 Consents and Approvals. No consent, approval or authorization
of, exemption by, or filing with, any governmental or regulatory authority is
required in connection with the execution, delivery and performance by the
Seller of this Agreement and the consummation by the Seller of the transactions
contemplated hereby.
2.5 No Conflicts. The execution, delivery and performance by the
Seller of this Agreement to which the Seller is a party and the consummation by
the Seller of the transactions contemplated hereby do not conflict with, or
constitute or result in a breach, default or violation of (with or without the
giving of notice or the passage of time) any of the terms, provisions or
conditions of, (i) the Articles of Incorporation, By-Laws or similar charter
document of Music Line or any Subsidiary of Music Line; (ii) any law, ordinance,
regulation or rule applicable to Music Line or any Subsidiary of Music Line;
(iii) any order, judgment, injunction or other decree by which Music Line or any
Subsidiary of Music Line or any of their respective assets or properties is
bound; or (iv) any written or oral contract, agreement, or commitment to which
Music Line or any Subsidiary of Music Line is a party or by which they or any of
their respective assets or properties is bound; nor will such execution,
delivery and performance result in the creation of any material Lien upon any
properties, assets or rights of Music Line or any Subsidiary of Music Line.
2.6 Subsidiaries. Except as set forth in Disclosure Schedule 2.6,
Music Line does not, and at the Closing will not, own any equity ownership
interest, directly or indirectly, in any person, corporation or other entity.
The entities so set forth in
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Disclosure Schedule 2.6, are collectively referred to as the "Subsidiaries" and
individually as a "Subsidiary." At the Closing, Music Line will own, either
directly or indirectly through one or more Subsidiaries, the shares of capital
stock of the Subsidiaries free and clear of any Lien (other than Permitted
Liens). At the Closing, all of the issued and outstanding shares of capital
stock of the Subsidiaries of Music Line will be validly issued, fully paid and
non-assessable, and there will not be outstanding any securities convertible
into, exchangeable for, or carrying the right to acquire, equity securities of
any of the Subsidiaries of Music Line, or subscriptions, warrants, options,
rights or other arrangements or commitments obligating any Subsidiary of Music
Line to issue or dispose of any of its equity securities or any ownership
interest therein.
2.7 Conduct of Business. Since March 31, 1999, there have not
been any adverse events or developments which, individually or together with
other such events, could reasonably be expected to have a material adverse
effect on the Business or Condition of Music Line or of any Subsidiary of Music
Line. In addition, without limiting the foregoing, since March 31, 1999, neither
Music Line nor any Subsidiary of Music Line:
(a) has (i) declared, set aside or paid any dividend or other
distribution in respect of the capital stock of Music Line or any Subsidiary of
Music Line or (ii) directly or indirectly redeemed, purchased or otherwise
acquired any such capital stock or other equity interests;
(b) authorized, issued, sold or otherwise disposed of, or granted
any option or covered security with respect to any shares of capital stock or
other equity interests of Music Line or any Subsidiary of Music Line, or
modified or amended any right of any holder of any outstanding shares of capital
stock or other equity interests of Music Line or any Subsidiary of Music Line or
option or covered security with respect thereto;
(c) (i) increased the salary, wages or other compensation
(including, without limitation, any bonuses, commissions and any other payments)
of any officer, employee or consultant of Music Line or any Subsidiary of Music
Line whose annual salary, wages and such other compensation is, or after giving
effect to such change would be, in the aggregate, $100,000 or more per annum;
(ii) established or modified (A) targets, goals, pools or similar provisions
under any benefit plan, employment contract or other employee compensation
arrangement or (B) salary ranges, increase guidelines or similar provisions in
respect of any benefit plan, employment contract or other employee compensation
arrangement; or (iii) adopted, entered into, amended, modified or terminated (in
whole or in part) any benefit plan;
(d) (i) incurred any debt, (ii) made or agreed to make any loans to
any Person or (iii) made or agreed to make any voluntary purchase, cancellation,
prepayment
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or complete or partial discharge in advance of a scheduled payment date with
respect to, or waiver of any right of Music Line or any Subsidiary of Music Line
under, any debt of or owing to Music Line or any Subsidiary of Music Line;
(e) suffered any physical damage, destruction or other casualty loss
(whether or not covered by insurance) adversely affecting any of the real or
personal property or equipment of the material assets of Music Line or any
Subsidiary of Music Line;
(f) failed to pay or satisfy when due any obligation of Music Line
or any Subsidiary of Music Line, except when the failure would not have a
material adverse effect on the Business or Condition of Music Line or any
Subsidiary of Music Line;
(g) acquired any business or assets of any Person (whether by
merger, consolidation or otherwise) or disposed or leased, or incurred a Lien
(other than a Permitted Lien) on, any assets of Music Line or any Subsidiary of
Music Line, in each case, other than acquisitions or dispositions of inventory
in the ordinary course of business of Music Line or such Subsidiary of Music
Line consistent with past practice;
(h) entered into, amended, modified, terminated (in whole or in
part) or granted a waiver under or given any consent with respect to any
Intellectual Property;
(i) commenced any new line of business or terminated or changed any
line of the business conducted by Music Line and its Subsidiaries during the
fiscal year ended on March 31, 1999;
(j) entered into any transaction with any stockholder or Affiliate
of Music Line or any Subsidiary of Music Line;
(k) made any change in the accounting methods or procedures of Music
Line or any Subsidiary of Music Line or become subject to any conditions or
event which has or could reasonably be expected to have a material adverse
effect on the Business or Condition of Music Line or any Subsidiary of Music
Line; or
(l) entered into any agreement to do any of the things described in
the preceding paragraphs, including, without limitation, with respect to any
business combination not otherwise restricted by the preceding paragraphs.
2.8 Corporate Formalities; Books and Records.
(a) Music Line and each Subsidiary of Music Line have complied in
all material respects with all corporate formalities required to be complied
with under applicable laws.
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(b) The minute books and other similar records of Music Line and
each Subsidiary of Music Line as made available to the Seller prior to the
execution of this Agreement contain a true and complete record, in all material
respects, of all action taken at all meetings and by all written consents in
lieu of meetings of directors, members, stockholders, the management committee
or boards of directors, subcommittees and committees of the boards of directors
of Music Line and each Subsidiary of Music Line.
2.9 Financial Statements. A copy of the balance sheet of Music Line
as of June 30, l998 and the nine-month period ended March 31, 1999 and the
statements of income and retained earnings and changes in financial position of
Music Line for the year ended June 30, 1998 and the nine-month period ended
March 31, 1999 (the "Financial Statements"), have been delivered to the Company.
Except as noted therein, the Financial Statements fairly present the
consolidated financial position of Music Line and its results of operations for
the 12-month period ended December 31, 1998, in conformity with accepted
accounting standards consistently applied for such period. Between the date of
the balance sheet and the Closing Date, Music Line shall not have suffered any
changes materially adverse to its business, financial condition or results.
2.10 Liabilities. Neither Music Line nor any Subsidiary of Music
Line has any material debts, obligations or liabilities of whatever kind or
nature, either direct or indirect, absolute or contingent, matured or unmatured,
except debts, obligations and liabilities that are fully reflected in, or
reserved against on, the Financial Statements.
2.11 Accounts and Notes Receivable. The accounts and notes
receivable reflected on the Music Line balance sheet or thereafter acquired by
Music Line or its Subsidiaries on or prior to the Closing Date arose and will
have arisen from bona fide transactions in the ordinary course of business and
will have been collected in full or be fully collectible at their face amounts
(less any applicable reserves reflected on the balance sheet or thereafter
established on a basis consistent with the reserves reflected on the balance
sheet) within 90 days after the Closing Date.
2.12 Title to Properties. (a) The Seller has good and marketable
title to the Shares, free and clear of all liens, except Permitted Liens.
(b) Music Line and its Subsidiaries have good and marketable title
to all of the assets and properties which they purport to own and which are
reflected on the balance sheet of Music Line, free and clear of all Liens,
except for Permitted Liens.
2.13 Intellectual Property. At the Closing, (a) Music Line and its
Subsidiaries own or possess adequate licenses or other valid rights to use all
United States and foreign Intellectual Property which is material to the conduct
of the business, operations or financial condition of Music Line and its
Subsidiaries; (b) to Music Line's and the Seller's knowledge, the validity of
the Intellectual Property and the title thereto of
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Music Line or its Subsidiaries have not been questioned in any litigation to
which Music Line or any of its Subsidiaries has been or is a party, nor was any
such litigation threatened or claims of third parties made to Music Line or the
Seller's knowledge; and (c) the conduct of the business of Music Line and its
Subsidiaries as conducted at the Closing does not conflict with any valid
patents, trademarks, trade names, service marks or copyrights of others. The
consummation of the transactions contemplated hereby will not result in the loss
or impairment of any of the Intellectual Property.
2.14 Contracts. Each Contract to which Music Line or its
Subsidiaries are parties or by which their respective properties are bound and
which is material to the business conducted by Music Line and its Subsidiaries
(the "Music Line Contracts") is valid, binding, and enforceable in accordance
with its terms for the periods (if any) stated therein, except to the extent
enforceability may be limited by bankruptcy, insolvency, moratorium, or other
similar laws affecting creditors' rights generally and limitations on the
availability of equitable remedies; Music Line and its Subsidiaries have
fulfilled or have taken all actions necessary to enable them to fulfill when due
all of their obligations under the Music Line Contracts, and there is not, under
any of the foregoing, any existing default or event of default by Music Line or
its Subsidiaries or any event which, with or without the giving of notice or the
passage of time, would constitute a default under any of the Music Line
Contracts.
2.15 Litigation. There is no action, proceeding or investigation in
any court or before any governmental or regulatory authority pending or
threatened in writing or orally (a) against Music Line or any of its
Subsidiaries, (b) which seeks to enjoin or obtain damages in respect of the
consummation of the transactions contemplated hereby, or (c) which renders the
Company unable to hold shares in Music Line. Neither Music Line nor any of its
Subsidiaries is subject to any outstanding order, writ, judgment or decree.
2.16 Taxes. (i) All tax returns required to be filed with respect to
Music Line and its Subsidiaries have been filed in a timely manner (taking into
account all extensions of due dates), and (ii) Music Line and its Subsidiaries
have paid, or have made sufficient provision for, or have set up adequate
reserves for the payment of, all Taxes shown as due on such returns.
2.17 Compliance with Laws. Music Line and its Subsidiaries have
complied in all material respects with all laws, statutes, rules, regulations,
judgments, decrees and orders applicable to their business.
2.18 Employee Benefits and Agreements. (a) The Disclosure Schedule
contains a list of (i) all material employment contracts between Music Line and
its Subsidiaries and each executive officer thereof and (ii) all bonus,
incentive, stock option, stock purchase, phantom stock, stock appreciation
rights, performance shares, and similar plans either currently maintained by
Music Line or its Subsidiaries and each employee pension and benefit plan which
Music Line or its Subsidiaries maintain or to which any
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of such parties contributes or is required to contribute on behalf of its
employees, directors or consultants.
(b) Music Line and its Subsidiaries are not experiencing any
significant problems with any of their employees or consultants.
2.19 Licenses and Permits. Music Line and its Subsidiaries have all
material governmental licenses and permits and other governmental authorizations
and approvals required for the conduct of their businesses as presently
conducted.
2.20 Business. Music Line and its Subsidiaries are engaged in the
business of distributing music CDs and videotapes through various channels
including Internet in Europe. Substantially all of Music Line's consolidated
revenues are generated in such business. Since inception, the business operated
by Music Line and its Subsidiaries as reflected on the Financial Statement, has
at all times been solely conducted by Music Line and its Subsidiaries.
2.21 Exemption from Registration; Restrictions on Offer and Sale of
Same or Similar Securities. Assuming the representations and warranties of the
Company set forth in Section 3.5 are true and correct in all material respects,
the offer and sale of the Shares pursuant to this Agreement is exempt from the
registration requirements of the Securities Act. Neither Music Line nor any
Person authorized to act on its behalf has, in connection with the offering of
the Shares, engaged in (i) any form of general solicitation or general
advertising (as those terms are used within the meaning of Rule 501(c) under the
Securities Act), (ii) any action involving a public offering within the meaning
of section 4(2) of the Securities Act, or (iii) any action that would require
the registration under the Securities Act of the offering and sale of the Shares
pursuant to this Agreement or that would violate applicable state securities or
"blue sky" laws. Neither the Seller nor any such Person has made, directly or
indirectly, any offer or sale of Common Stock or of securities of the same or a
similar class as the shares of Common Stock to be purchased pursuant to this
Agreement that, as a result of the offer and sale of the shares of Common Stock
contemplated hereby, could fail to be entitled to the exemption from the
registration requirements of the Securities Act. As used herein, the terms
"offer" and "sale" have the meanings specified in Section 2(3) of the Securities
Act.
2.22 Affiliate Transactions. (i) There are no debts, obligations or
liabilities owed to Music Line or any Subsidiary of Music Line, on the one hand,
by any current or former stockholder or Affiliate of Music Line or of any
Subsidiary of Music Line or by any Affiliate of any such stockholder or
Affiliate; (ii) there are no debts, obligations or liabilities owed by Music
Line or any Subsidiary of Music Line, on the one hand, to any such current or
former stockholder or, on the other hand, to any Affiliate of Music Line or any
Affiliate of any such stockholder or Affiliate; (iii) neither Music Line nor any
such current or former stockholder or Affiliate provides or causes to be
provided
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any assets, services or facilities to Music Line or any Subsidiary of Music
Line; and (iv) neither Music Line nor any Subsidiary of Music Line provides or
causes to be provided any assets, services or facilities to any such current or
former stockholder or Affiliate.
2.23 Business Relationships. Since March 31, 1999, no business
relationship of Music Line or any Subsidiary of Music Line with any customer,
supplier or any group of customers or suppliers whose purchases or sales, as the
case may be, are individually or in the aggregate material to the Business or
Condition of Music Line or any Subsidiary of Music Line has been, or to the
knowledge of Music Line or the Seller is threatened to be, terminated, canceled,
limited or changed or modified adversely, and, to the knowledge of the Seller,
there exists no present condition or state of facts or circumstances with
respect to such business relationship that would materially adversely affect the
Business or Condition of Music Line or any Subsidiary of Music Line, or prevent
Music Line or any Subsidiary of Music Line from conducting its business as
previously conducted after the consummation of the transactions contemplated by
this Agreement, in substantially the same manner in which it has heretofore been
conducted.
2.24 Disclosure. This Agreement does not, and the documents and
certificates executed by the Seller or Music Line or otherwise furnished by the
Seller or Music Line to the Company do not, and at the Closing and will not,
contain any untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements contained herein or therein, in light
of the circumstances under which they were made, not misleading.
2.25 Other Negotiations; Brokers. Neither Music Line, any Subsidiary
of Music Line, the Seller, nor any of their respective Affiliates (nor any
investment banker, financial advisor, attorney, accountant or other Person
retained by or acting for or on behalf of Music Line, any Subsidiary of Music
Line, the Seller, nor any of their respective Affiliates) (i) has entered into
any agreement that conflicts with any of the transactions contemplated by this
Agreement or (ii) has entered into any agreement or had any discussions with any
third party regarding any transaction involving Music Line, any Subsidiary of
Music Line or the Seller which could result in the Company or its members,
officers, directors, employees, agents or Affiliates being subject to any claim
for liability to said third party as a result of entering into this Agreement or
consummating the transactions contemplated hereby.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company hereby represents and warrants to the Seller as follows
as of the date hereof and as of the Closing Date:
3.1 Organization. The Company is a corporation organized, validly
existing and in good standing under the laws of Delaware and has all requisite
corporate
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power and authority to carry on its business as it is now being conducted and to
execute, deliver and perform this Agreement and to consummate the transactions
contemplated hereby.
3.2 Corporate Power and Authority. The execution, delivery and
performance by the Company of this Agreement and the consummation by the Company
of the transactions contemplated hereby have been duly authorized by all
necessary action on the part of the Company. This Agreement has been duly and
validly executed and delivered by the Company and constitutes the valid and
binding obligation of the Company, enforceable against the Company in accordance
with its terms, except to the extent that such enforceability (i) may be limited
by bankruptcy, insolvency or other similar laws relating to creditors' rights
generally, and (ii) is subject to general principles of equity.
3.3 Litigation. There is no action, proceeding or investigation in
any court or before any governmental or regulatory authority pending or
threatened in writing or, to the Company's knowledge, orally threatened which
seeks to enjoin or obtain damages in respect of the consummation of the
transactions contemplated hereby.
3.4 No Conflicts. The execution, delivery and performance by the
Company of this Agreement and the consummation by the Company of the
transactions contemplated hereby do not, with or without the giving of notice or
the lapse of time, or both, (i) violate any provision of law, statute, rule or
regulation to which the Company is subject, (ii) violate any order, judgment or
decree applicable to the Company or (iii) conflict with, or result in a breach
or default under, any term or condition of the Company's Certificate of
Incorporation or By-Laws or any material agreement or other instrument to which
the Company or any of its subsidiaries is a party or by which any of them may be
bound; except for violations, conflicts, breaches or defaults which in the
aggregate would not materially hinder or impair the consummation of the
transactions contemplated hereby.
3.5 Investment Intent. The Company is an "accredited investor" as
that term is defined in Rule 501 of Regulation D promulgated under the
Securities Act. The Company is acquiring the Shares and any other shares of
Common Stock issued to it hereunder solely for its own account and not with a
view to a sale or distribution thereof in violation of any securities laws. The
Company acknowledges that it has received, or has had access to, all information
which it considers necessary or advisable to enable it to make a decision
concerning its purchase of the Shares, provided that the foregoing shall not
limit or otherwise affect the rights or remedies of the Company hereunder with
respect to the breach of any representations, warranties, covenants or
agreements of the Seller contained herein.
3.6 Consents. No consent, approval or authorization of, exemption
by, or filing with, any governmental or regulatory authority is required in
connection with the execution, delivery and performance by the Company of this
Agreement or the consummation by the Company of the transactions contemplated
hereby, excluding,
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however, consents, approvals, authorizations, exemptions and filings, if any,
which the Seller is required to obtain or make.
ARTICLE IV
CERTAIN COVENANTS OF THE PARTIES
The Seller, on the one hand, and the Company, on the other hand,
hereby covenant to and agree with one another as follows:
4.1 Access. Subject to compliance by the Company with the provisions
of Section 4.2, from the date of this Agreement to the Closing Date, the Seller
shall (i) provide the Company with access to such information as it may request
with respect to the properties, books and records of the Music Line and its
Subsidiaries and on the transactions contemplated by this Agreement, (ii) permit
the Company and its authorized representatives reasonable access during regular
business hours and upon reasonable notice to the properties, books, and records
of Music Line and its Subsidiaries, including, but not limited to, a complete
and correct certified copy Music Line's Articles of Association and By-Laws, as
currently in effect, and a certified excerpt from the Commercial Register, as
currently in effect; (iii) permit the Company to make such inspections thereof
as the Company may reasonably request; in each case to the extent necessary to
conduct customary due diligence with respect to its investment in Music Line;
and (iv) permit the Company reasonable opportunity to ask questions of and
receive answers from a person or persons acting on behalf of Music Line and/or
the Seller concerning the transfer of the Shares to the full satisfaction of the
Company.
4.2 Confidentiality.
(a) The parties hereto shall keep confidential any information which
has been made available or furnished to it (each, as the case may be, a
"Recipient") by or on behalf of the other party (each, as the case may be, a
"Provider"), in connection with the transactions contemplated by this Agreement
and the Transaction Documents (collectively, "Confidential Information"), and
shall use the Confidential Information solely in connection with the
transactions contemplated by this Agreement and the Transaction Documents. If
this Agreement is terminated, the Recipient will return all Confidential
Information to the Provider and either destroy any writings prepared by or on
behalf of the Recipient based on Confidential Information or deliver such
writings to the Provider. Confidential Information does not include information
which (i) is or becomes (but only when it becomes) generally available to the
public other than as a result of disclosure in violation of this Section 4.2, or
(ii) is or becomes (but only when it becomes) available to the Recipient on a
non-confidential basis from a source other than the Provider, or any of its
agents or advisors or employees, provided that such source is not bound by a
confidentiality agreement with the Provider in respect thereof.
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(b) The Recipient may disclose Confidential Information to any of
its directors, officers, employees, agents, advisors and, in the case of the
Company, its prospective investors, who need to know such Confidential
Information in connection with the transactions contemplated by this Agreement
or the Transaction Documents; provided that, prior to making such disclosure,
the Recipient shall inform all such persons and entities of the confidential
nature of such Confidential Information and such persons and entities shall
agree, for the benefit of the Provider, to be bound by the terms and conditions
of this Section 4.2. In any event, the Recipient will be responsible for damages
incurred by the Provider arising from any breach of this Section 4.2 by any
person or entity to whom Confidential Information shall have been furnished. The
Recipient may disclose Confidential Information if required by legal process or
by operation of applicable law (but only to the extent so required), provided
that the Recipient shall first promptly notify the Provider thereof so that the
Provider may seek an appropriate protective order and/or waive compliance by the
Recipient with the provisions of this Section 4.2.
4.3 Conduct of Business. Except for the transactions contemplated by
this Agreement, from March 31, 1999 through the Closing Date, the Seller shall
cause Music Line and its Subsidiaries to conduct their respective businesses
only in the ordinary course consistent with past practice and the terms of this
Agreement. Without limiting the generality of the foregoing, Music Line and its
Subsidiaries shall:
(a) use their best efforts to (A) preserve intact the present
business organization and reputation of Music Line and its Subsidiaries, (B)
keep available (subject to dismissals and retirements in the ordinary course of
business consistent with the past practice of Music Line) the services of the
present officers, employees and consultants of Music Line and its Subsidiaries,
(C) maintain the assets of Music Line and its Subsidiaries in good working order
and condition, ordinary wear and tear excepted, (D) maintain the good will of
customers, suppliers and lenders and other Persons with whom Music Line or any
Subsidiary of Music Line otherwise have significant business relationships and
(E) continue all current sales, marketing and promotional activities relating to
the business and operations of Music Line and its Subsidiaries;
(b) cause their respective books and records to be maintained in the
usual, regular and ordinary manner and observe all corporate formalities
required by applicable law;
(c) comply in all material respects with all laws, regulations and
orders applicable to the business and operations of Music Line and its
Subsidiaries, and promptly following receipt thereof give the Company copies of
any notice received from any governmental or regulatory authority or other
Person alleging any violation of any such law, regulation or order;
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(d) (A) administer each benefit plan, or cause the same to be so
administered, in all material respects in accordance with the applicable
provisions of all applicable laws; and (B) refrain from making any
representation or promise, oral or written, to any employee concerning any
benefit plan, except for statements as to the rights or accrued benefits of any
employee; and
(e) refrain from: (A) amending their articles of incorporation or
by-laws (or other comparable charter documents) or taking any action with
respect to any such amendment or any reorganization, liquidation or dissolution
of any such entity; (B) taking any of the actions listed in Section 2.7 hereof;
(C) violating, breaching, or defaulting under, in any material respect, or
taking or failing to take any action that (with or without notice or lapse of
time or both) would constitute a material violation or breach of, or default
under, any term or provision of any permit held or used by Music Line or any
Subsidiary of Music Line or any Contract to which Music Line or any Subsidiary
of Music Line is a party or by which any of its assets or properties is bound;
(D) (I) taking or agreeing or committing to take or omitting or agreeing or
committing to omit any action that would make any representation or warranty of
Music Line hereunder inaccurate in any material respect; or (II) taking any
action or course of action inconsistent with compliance with the covenants and
agreements of Music Line herein or which might adversely affect the interests of
the Company hereunder; and (F) entering into any agreement to engage in any of
the activities listed in this Section 4.3.
4.4 Notice and Cure. The Seller shall notify the Company promptly in
writing of, and contemporaneously shall provide the Company with true and
complete copies of any and all information or documents relating to, and shall
use its best efforts to cure before the each Closing Date, any event,
transaction or circumstance occurring after the date of this Agreement that
causes or shall cause any covenant or agreement of the Seller under this
Agreement to be breached or that renders or shall render untrue any
representation or warranty of the Seller contained in this Agreement as if the
same were made on or as of the date of such event, transaction or circumstance.
The Seller also shall notify the Company promptly in writing of, and shall use
its best efforts to cure, before the Closing, any violation or breach of any
representation, warranty, covenant or agreement made by the Seller in this
Agreement, whether occurring or arising before, on or after the date of this
Agreement. No notice given pursuant to this Section 4.4 shall have any effect on
the representations, warranties, covenants or agreements contained in this
Agreement for purposes of determining satisfaction of any condition contained
herein or shall in any way limit the Company's right to seek indemnity under
Article VIII.
4.5 Lines of Business. The Seller shall not, and shall not permit
Music Line or any of its Subsidiaries to, without the prior written consent of
the Company, engage in any material activity in any line of business other than
the business conducted on or prior to March 31, 1999.
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ARTICLE V
(a) Non-Compete. For a period of one (1) year from the Closing Date
(the "Restricted Period"), the Seller shall not, without the prior written
consent of the Company, directly or indirectly, whether as an employee,
director, independent contractor, consultant, licensor, licensee, stockholder,
partner, or otherwise, engage or assist others to engage in or have any interest
in any business which competes with the business conducted by Music Line or its
subsidiaries directly or indirectly at such time in any jurisdictions in which
the Company then operates the business currently conducted by Music Line, or
licenses third parties to carry on, such business; provided, however, that the
Seller may own directly or indirectly, solely as an investment, securities of
any Person which engages in such in any such business which are traded on any
national securities exchange as long as none of them (y) is a controlling person
of, or a member of a group which controls, such Person or (z) (when added
together with any other securities held by the Seller directly or indirectly),
owns 1% or more of any class of securities of such Person.
(b) The Seller further agrees that during the Restricted Period, he
shall not, directly or indirectly, (i) solicit, induce, enter into any agreement
with, or attempt to influence any individual who was an employee or consultant
of Music Line or any of its Subsidiaries at any time prior to the Closing or
during the Restricted Period, to terminate his or her employment or consulting
relationship with Music Line or any of its subsidiaries or to become employed by
the Seller or any individual or entity controlled by the Seller or by which the
Seller is employed or (ii) interfere in any other way with the employment, or
other relationship, of any employee or consultant of Music Line or its
Affiliates.
ARTICLE VI
CONDITIONS TO THE COMPANY'S OBLIGATIONS
The obligations of the Company to consummate the transactions
contemplated hereby shall be subject to the satisfaction on or prior to the
Closing Date of all of the following conditions, except such conditions as the
Company may waive:
6.1 Representations, Warranties and Covenants of the Seller. The
Seller shall have complied in all material respects with all of its agreements
and covenants contained herein required to be complied with at or prior to the
Closing Date, and all the representations and warranties of the Seller contained
herein shall be true in all material respects on and as of the Closing Date with
the same effect as though made on and as of the Closing Date, except as
otherwise contemplated hereby, and except to the extent that such
representations and warranties expressly make reference to a specified date and
as to such representations and warranties the same shall continue on the Closing
Date to have been true as of the specified date.
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6.2 Further Action. All action (including notifications and filings)
that shall be required to be taken by the Seller in order to consummate the
transactions contemplated hereby shall have been taken and all consents,
approvals, authorizations and exemptions from third parties that shall be
required in order to enable the Seller to consummate the transactions
contemplated hereby shall have been duly obtained (except for such actions,
consents, approvals, authorizations and exemptions, the absence of which would
not prohibit consummation of such transactions or render such consummation
illegal), and, as of the Closing Date, the transactions contemplated hereby
shall not violate any applicable law or governmental regulation.
6.3 No Governmental or Other Proceeding. No order of any court or
governmental or regulatory authority or body which restrains or prohibits the
transactions contemplated hereby shall be in effect on the Closing Date and no
suit or investigation by any government agency to enjoin the transactions
contemplated hereby or seek damages or other relief as a result thereof shall be
pending or threatened as of the Closing Date.
6.4 Shareholder consent: The Company shall have received the consent
of the holders of two-thirds of the outstanding shares of the Company`s Common
stock held by persons other than the seller and persons who are affiliated or
associated with the seller to this Agreement and the consummation of the
transactions contemplated hereby.
ARTICLE VII
CONDITIONS TO THE SELLER'S OBLIGATIONS
The obligations of the Seller to consummate the transactions
contemplated hereby shall be subject to the satisfaction on or prior to the
Closing Date of all of the following conditions, except such conditions as the
Seller may waive:
7.1 Representations, Warranties and Covenants of the Company. The
Company shall have complied in all material respects with all of its agreements
and covenants contained herein required to be complied with at or prior to the
Closing Date, and the representations and warranties of the Company contained
herein shall be true in all material respects on and as of the Closing Date with
the same effect as though made on and as of the Closing Date, except as
otherwise contemplated hereby, and except to the extent that such
representations and warranties expressly make reference to a specified date and
as to such representations and warranties the same shall continue on the Closing
Date to have been true as of the specified date.
7.2 Further Action. All action (including notifications and filings)
that shall be required to be taken by the Company in order to consummate the
transactions contemplated hereby shall have been taken and all consents,
approvals, authorizations and exemptions from third parties that shall be
required in order to enable the Seller to consummate the transactions
contemplated hereby shall have been duly obtained (except
15
for such actions, consents, approvals, authorizations and exemptions, the
absence of which would not prohibit consummation of such transactions or render
such consummation illegal), and, as of the Closing Date, the transactions
contemplated hereby shall not violate any applicable law or governmental
regulation.
7.3 No Governmental or Other Proceeding. No order of any court or
governmental or regulatory authority or body which restrains or prohibits the
transactions contemplated hereby shall be in effect on the Closing Date and no
suit or investigation by any government agency to enjoin the transactions
contemplated hereby or seek damages or other relief as a result thereof shall be
pending or threatened in writing as of the Closing Date.
ARTICLE VIII
SURVIVAL AND INDEMNIFICATION
8.1 Survival. The representations and warranties contained herein
and the covenants and agreements to be performed or complied with after the
Closing shall survive the Closing for a period of one year except for Music
Line's representations set forth in Section 2.16 which shall survive the Closing
until the expiration of a period of six months following the expiration of the
applicable statute of limitation. A claim for indemnification by a party against
the other under this Article VIII for inaccuracy in a representation or warranty
or breach of any covenants and agreements contained herein must be asserted in
writing and in accordance with Section 8.3 prior to the expiration of the
applicable time period referenced above, following which such claims shall be
barred for all purposes. If written notice of a claim for indemnification is
given in accordance with Section 8.3 prior to the expiration of the applicable
time period referenced above, then the representation, warranty, covenant, or
agreement applicable to such claim shall survive until, but only for purposes
of, resolution of such claim.
8.2 Indemnification. Subject to the provisions of Section 8.1, from
and after the Closing, each of (i) the Company and (ii) the Seller shall
indemnify and hold harmless the Company, its directors, officers, agents and
employees (other than the Seller) (the party seeking indemnification being
referred to as the "Indemnified Party") from and against any and all claims,
losses, liabilities and damages, including, without limitation, amounts paid in
settlement, reasonable costs of investigation and reasonable fees and
disbursements of counsel, arising out of or resulting from the inaccuracy of any
representation or warranty, or the breach of any covenant or agreement,
contained herein or in any instrument or certificate delivered pursuant hereto,
by the party against whom indemnification is sought (the "Indemnifying Party").
8.3 Notice of Claim. The Indemnified Party shall promptly notify the
Indemnifying Party in writing of any claim for indemnification, specifying in
detail the basis of such claim, the facts pertaining thereto and, if known, the
amount, or an estimate of the amount, of the liability arising therefrom. The
Indemnified Party shall provide to
16
the Indemnifying Party as promptly as practicable thereafter all information and
documentation necessary to support and verify the claim asserted and the
Indemnifying Party shall be given reasonable access to all books and records in
the possession or control of the Indemnified Party which the Indemnifying Party
reasonably determines to be related to such claim.
8.4 Defense. If the facts giving rise to a right to indemnification
arise out of the claim of any third party, or if there is any claim against a
third party, the Indemnifying Party may assume the defense or the prosecution
thereof, including the employment of counsel, at its cost and expense. The
Indemnified Party shall have the right to employ counsel separate from counsel
employed by the Indemnifying Party in any such action and to participate
therein, but the fees and expenses of such counsel employed by the Indemnified
Party shall be at its expense. The Indemnifying Party shall not be liable for
any settlement of any such claim effected without its prior written consent
which consent shall not be unreasonably withheld. Whether or not the
Indemnifying Party does choose to so defend or prosecute such claim, all the
parties hereto shall cooperate in the defense or prosecution thereof and shall
furnish such records, information and testimony, and attend at such conferences,
discovery proceedings, hearings, trials and appeals, as may be reasonably
requested in connection therewith. The Indemnifying Party shall be subrogated to
all rights and remedies of the Indemnified Party to the extent of any
indemnification provided hereunder.
ARTICLE IX
TERMINATION PRIOR TO CLOSING
9.1 Termination of Agreement. This Agreement may be terminated at
any time prior to the Closing:
(i) by the mutual written consent of the Company and the Seller;
(ii) by the Seller in writing if the Closing shall not have occurred
on or before September 31, 1999 or such other date to which the
Closing Date hereunder been extended by the mutual agreement of the
parties hereto; or
(iii) by either party, if the other party shall (x) fail to perform
in any material respect its agreements contained herein required to
be performed prior to the Closing, or (y) materially breach any of
its representations, warranties, covenants or agreements contained
herein, which failure or breach is not cured within five business
days after the party seeking to terminate has notified the other
party of its intent to terminate this Agreement pursuant to this
clause.
9.2 Termination of Obligations. Termination of this Agreement
pursuant to this Article IX shall terminate all obligations of the parties
hereunder, except for the obligations under Sections 4.2 and 11.9 and 11.10;
provided, however, that termination pursuant to clause (ii) or (iii) of Section
9.1 shall not relieve the defaulting or
17
breaching party from any liability to the other party hereto resulting from its
willful breach of this Agreement.
ARTICLE X
DEFINITIONS
As used in this Agreement, the following defined terms shall have
the meanings indicated below:
"Actions or Proceedings" means any action, suit, proceeding,
arbitration or governmental or regulatory authority investigation or audit.
"Affiliate" means, as applied to any Person, (i) any other Person
directly or indirectly controlling, controlled by or under common control with,
that Person, (ii) any other Person that owns or controls five percent (5%) or
more of any class of equity securities (including any equity securities issuable
upon the exercise of any Option) of that Person or any of its Affiliates, or
(iii) any member, director, partner, officer, agent, employee or relative of
such Person. For the purposes of this definition, "control" (including with
correlative meanings, the terms "controlling," "controlled by," and "under
common control with") as applied to any Person, means the possession, directly
or indirectly, of the power to direct or cause the direction of the management
and policies of that Person, whether through ownership of voting securities or
by contract or otherwise.
"Agreement" means this Stock Purchase Agreement, the Exhibits,
Schedules, Disclosure Schedules and the certificates delivered in connection
herewith, as the same may be amended, modified or restated from time to time in
accordance with the terms hereof.
"Business and/or Condition" means the business, condition (financial
or otherwise), results of operations and assets of Music Line and its
Subsidiaries taken as a whole.
"Business Day" means a day other than Saturday, Sunday or any day on
which banks located in the State of New York and the City of Zurich, Switzerland
are authorized or obligated to close.
"Closing" has the meaning given to it in Section 1.2.
"Closing Date" has the meaning given to it in Section 1.2.
18
"Common Stock" has the meaning given to it in the forepart to this
Agreement.
"Company" has the meaning given to it in the forepart to this
Agreement.
"Contract" means any agreement, lease, license, evidence of
indebtedness, mortgage, indenture, security agreement or other contract or other
commitment (whether written or oral).
"Disclosure Schedule" means the schedules delivered to the Company
by or on behalf of the Seller and to the Seller by or on behalf of the Company,
containing all lists, descriptions, exceptions and other information and
materials as are required to be included therein by the Seller pursuant to
Article II and by the Company pursuant to Article III of this Agreement.
"Intellectual Property" means all patents and patent rights,
trademarks and trademark rights, trade names and trade name rights, service
marks and service xxxx rights, service names and service name rights, brand
names, inventions, processes, formulae, copyrights and copyright rights, trade
dress, business and product names, logos, slogans, trade secrets, industrial
models, processes, designs, methodologies, computer programs (including all
source codes) and related documentation, technical information, manufacturing,
engineering and technical drawings, know-how and all pending applications for
and registrations of patents, trademarks, service marks and copyrights.
"Laws" means all laws, statutes, rules, regulations, ordinances and
other pronouncements having the effect of law of the United States, any foreign
country or any domestic or foreign state, county, city or other political
subdivision or of any Governmental or Regulatory Authority.
"Liens" means any mortgage, pledge, assessment, security interest,
lease, lien, adverse claim, levy, charge or other encumbrance of any kind, or
any conditional sale Contract, title retention Contract or Contract committing
to grant any of the foregoing.
"Permitted Liens" means (a) Liens for current taxes not yet due and
payable or for taxes the validity of which is being contested in good faith by
appropriate proceedings, and (b) Liens which individually or in the aggregate do
not materially and adversely affect the business, operations or financial
condition of Music Line and the Subsidiaries, taken as a whole.
"Person" means any individual, corporation, joint stock corporation,
limited liability company or partnership, general partnership, limited
partnership,
19
proprietorship, joint venture, other business organization, trust, union,
association or governmental or regulatory authority.
"Purchase Price" has the meaning given to it in Section 1.1.
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended, and
the rules and regulations thereunder.
"Company Charter" means any and all of the charter documents of the
Company, including but not limited to a Certificate of Incorporation, By-Laws,
Articles of Association and/or Memorandum, as the case may be.
"Subsidiary" means any Person in which Music Line, directly or
indirectly through Subsidiaries or otherwise, beneficially owns more than fifty
percent (50%) of either the equity interests in, or the voting control of, such
Person.
"Tax" or "Taxes" means all federal, state, local or foreign net or
gross income, gross receipts, net proceeds, sales, use, ad valorem, value added,
franchise, bank shares, withholding, payroll, employment, excise, property,
alternative or add-on minimum, environmental or other taxes, assessments,
duties, fees, levies or other governmental charges of any nature whatever,
whether disputed or not, together with any interest, penalties, additions to tax
or additional amounts with respect thereto.
ARTICLE XI
MISCELLANEOUS
11.1 Entire Agreement. This Agreement (including the Disclosure
Schedule and Exhibits) constitutes the sole understanding of the parties with
respect to the subject matter hereof. No amendment, modification or alteration
of the terms or provisions of this Agreement shall be binding unless the same
shall be in writing and duly executed by the parties hereto.
11.2 Successors and Assigns. The terms and conditions of this
Agreement shall inure to the benefit of and be binding upon the respective
successors of the parties hereto; provided, however, that this Agreement may not
be assigned by any party without the prior written consent of the other party
hereto, except that the Company may, at its election and without the prior
written consent of the Seller, assign this Agreement to any direct or indirect
wholly-owned subsidiary or any other affiliate of the Company in connection with
a permitted transfer of the Shares so long as the representations and warranties
of the Company made herein are equally true of such assignee. If this Agreement
is assigned with such consent or pursuant to such exceptions, the terms and
conditions hereof shall be binding upon and shall inure to the benefit of the
20
parties hereto and their respective assigns; provided, however, that no
assignment of this Agreement or any of the rights or obligations hereof shall
relieve any party of its obligations under this Agreement. With the exception of
the parties to this Agreement, (except as set forth in Article V) there shall
exist no right of any person to claim a beneficial interest in this Agreement or
any rights occurring by virtue of this Agreement.
11.3 Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall for all purposes be deemed to be an original
and all of which shall constitute the same instrument.
11.4 Headings. The headings of the Sections and paragraphs of this
Agreement are inserted for convenience only and shall not be deemed to
constitute part of this Agreement or to affect the construction hereof.
11.5 No Waiver. No action taken pursuant to this Agreement,
including any investigation by or on behalf of any party hereto, will be deemed
to constitute a waiver by the party taking any action of compliance with any
representation, warranty or agreement contained herein. The waiver by any party
hereto of any condition or of a breach of any other provision of this Agreement
will not operate or be construed as a waiver of any other condition or
subsequent breach. The waiver by any party of any of the conditions precedent to
its obligations under the Agreement will not preclude it from seeking redress
for breach of this Agreement other than with respect to the condition so waived.
11.6 Expenses. The Seller and the Company shall each pay all costs
and expenses incurred by it or on its behalf in connection with this Agreement
and the transactions contemplated hereby, including, without limiting the
generality of the foregoing, fees and expenses of its own financial consultants,
accountants and counsel.
11.7 Notices. Any notice, request, instruction or other document
(each, a "notice") to be given hereunder by any party hereto to any other party
hereto shall be in writing and delivered personally or sent by registered or
certified mail, postage prepaid,
if to the Seller to:
Xxxx Xxxxx
X.X.Xxx 00.
XX-0000 Xxxxxxxxxx, Xxxxxxxxxxx
Facsimile: 011 411 856 17 69
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if to the Company to:
UTG Communications International, Inc.
Attn: Board of Directors
Xxxxxxxxxxxx 00,
XX-0000 Xxxxxxxxxx, Xxxxxxxxxxx
Facsimile: 011 411 749 31 09
11.8 Further Assurances. From and after the Closing Date, each
party, at the request of the other party and at the requesting party's expense,
will take all such action and execute and deliver all such documents and
instruments as shall be reasonably necessary or appropriate to implement or
effectuate the transactions contemplated by this Agreement and to enable the
Company and the Seller to enjoy the respective benefits contemplated by this
Agreement (including without limitation confirming and vesting title to the
Shares in the Company as contemplated herein).
11.9 Governing Law. The validity, performance and enforcement of
this Agreement and any agreement entered into pursuant hereto, unless expressly
provided to the contrary, will be governed by the Laws of New York, without
giving effect to the principles of conflicts of law thereof.
11.10 Consent to Arbitration.
[(a) Either party shall have the right (but not the obligation), in
addition to all other rights and remedies provided by law, to compel the other
parties to binding arbitration in accordance with the then existing Rules for
Non-Administered Arbitration of Business Disputes of the Center for Public
Resources ("CPR") by a single arbitrator. The arbitrator shall be selected from
the CPR Panels of Distinguished Neutrals and shall be an attorney admitted to
practice in the state of New York with at least 10 years of experience in
commercial law. The arbitration shall be governed by the United States
Arbitration Act, 9 U.S.C. ss.ss.1-16, and judgment upon the award rendered by
the arbitrator may be entered by any court having jurisdiction thereof. The
place of arbitration shall be New York, New York. The arbitration shall begin
within thirty (30) days of the initiating party's notice of its intent to
arbitrate unless the parties agree in writing to an extension. The fees and
expenses of the arbitration shall be borne equally by the parties hereto.
(b) Except as provided in paragraph (a) above, the procedures
specified in this Section 11.10 shall be the sole and exclusive procedures for
the resolution of disputes between the parties arising out of or relating to
this Agreement; provided, however, that a party may seek a preliminary
injunction or other preliminary judicial relief if in its judgment such action
is necessary to avoid irreparable damage and, provided further, that the
arbitrator is specifically empowered to grant injunctive relief and specific
performance.]
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11.11 Public Announcements. The Seller and the Company shall consult
with each other before issuing any press releases or otherwise making any public
statements with respect to this Agreement and the transactions contemplated
hereby and shall not issue any such press release or make any public statement
prior to such consultation.
11.12 Specific Performance. The Seller, on the one hand, and the
Company, on the other hand, each acknowledges that the other will be irreparably
harmed and that there will be no adequate remedy at law in the event of a
violation by it of any of its covenants or agreements which are contained in
this Agreement. It is accordingly agreed that, in addition to any other remedies
which may be available upon the breach of such covenants and agreements, the
Seller or the Company, as the case may be, shall have the right to obtain
injunctive relief to restrain any breach or threatened breach of, or otherwise
to obtain specific performance of, the other's covenants or agreements contained
in this Agreement.
11.13 Gender, Etc. Unless the context of this Agreement otherwise
requires, (i) words of any gender include each other gender, (ii) words using
the singular or plural number also include the plural or singular number,
respectively, (iii) the terms "hereof," "herein," "hereby" and derivative or
similar words refer to this entire Agreement, (iv) the terms "Article" or
"Section" refer to the specified Article or Section of this Agreement, and (v)
the phrases "ordinary course of business" and "ordinary course of business
consistent with past practice" refer to the business and practice of Music Line
and its Subsidiaries.
11.14 Exhibits. The parties agree that if any Exhibit hereto is
incomplete upon execution hereof, the parties will agree to final documentation
for such Exhibit containing terms and provisions in form and substance
reasonably acceptable to both parties.
[signature page to follow]
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IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be executed on its behalf as of the date first above written.
UTG COMMUNICATIONS INTERNATIONAL, INC.
By: /s/ Xxxxx Xxxxxxx
--------------------------
Name: Xxxxx Xxxxxxx
Title: Treasurer
XXXXXX XXXXX
/s/ Xxxxxx Xxxxx
------------------------------
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DISCLOSURE SCHEDULES
Schedule 2.6 - Music Line Subsidiaries (each 100%-owned by Music Line)
SSC AG
JM Sontel AG
25
