PURCHASE AND SERVICES AGREEMENT
THIS PURCHASE AND SERVICES AGREEMENT
(hereinafter "Agreement") is made and entered into between GTC Telecom, Inc.,
its assigns, and successors (hereinafter "GTC") and Service One
Communications, Inc., its assigns, and successors (hereinafter "Service"),
on this 9th day of March, 1999 (the "Execution Date").
RECITALS
WHEREAS GTC Telecom, Inc. is a corporation duly organized
and existing under the laws of the State of Nevada, with offices
located at 0000 Xxxxxx Xxx., Xxxxx X-0, Xxxxx Xxxx, XX 00000;
WHEREAS Service One Communications, Inc. is a corporation
duly organized and existing under the laws of the State of Nevada,
with offices located at 00000 Xxxxx Xxxx., Xxxxx 000, Xxxxxxxxxx
Xxxxx, XX 00000;
WHEREAS Service previously contracted with approximately
7,500 individuals / entities (as set forth in Exhibit "A", attached
hereto) to design, develop, and set-up individual personal web pages
for said individuals (the "Customers");
WHEREAS GTC desires to purchase all of Service's rights,
title, and interests to the Customers;
WHEREAS GTC desires to contract with Service to design,
develop, and set-up personal Internet Web Pages for the Customers;
and
WHEREAS GTC and Service desire to enter into a legal and
binding agreement as set forth herein.
NOW, THEREFORE, GTC and Service agree as follows:
PURCHASE OF CUSTOMERS
1. PURCHASE OF CUSTOMERS. Service agrees to sell, transfer,
convey and assign to GTC and GTC agrees to purchase from Service,
subject to the terms and conditions set forth in this Agreement, all
of Service's rights, title and interest in and to the Customers,
including without limitation, all of the accounts receivable owing
from the Customers.
2. VALID CUSTOMERS. Following the execution of this Agreement,
GTC shall submit an invoice to all Customers for payment. Only
those Customers that execute the contract and return payment to GTC,
shall be considered Valid Customers. GTC shall provide Service with
copies of all documentation necessary, supporting GTC's
determination of the status of a Customer.
3. PURCHASE PRICE FOR VALID CUSTOMERS. In exchange for the
Customers and for design, development, and set-up services as
defined below, GTC agrees to pay Service $100.00 per each Valid
Customer as follows:
(a) On the Execution Date, GTC shall pay Service $75,000.00
as credit towards the purchase of 750 Valid Customers;
(b) Upon Thirty (30) days from the Execution Date (the
"Initial Validation Period"), GTC shall determine the number
of Valid Customers as set forth in paragraph 2 as of that
date. If the number of Valid Customers exceed 750, GTC shall
pay Service $100.00 for each additional Valid Customers
within one (1) week of the Initial Validation Period, up to
an additional 375 Valid Customers.
(c) Upon sixty (60) days from the Execution Date (the "Final
Validation Period"), GTC shall determine the number of Valid
Customers as set forth in paragraph 2 as of that date. If
the number of Valid Customers exceed 1,125, GTC shall pay
Service $100.00 for each additional Valid Customers within
one (1) week of the Final Validation Period.
(d) If, however, following the Final Validation Period, the
number of Valid Customers is less than 750, Service shall owe
GTC $100.00 per Valid Customer less 750. This amount shall
constitute a credit on behalf of GTC towards any future
services contracted for between GTC and Service, its assigns,
successors, or affiliated company, XxXxxxx.xxx, Inc.
4. DESIGN, DEVELOPMENT, AND SET-UP SERVICES. In addition to
transferring all rights, title, and interests in the Customers to
GTC, Service One agrees to design, develop, and set-up Personal
Individual Internet Web Pages (as previously agreed between Service
One and the Customers) for all Valid Customers transferred under
this Agreement. In addition, upon completion of the design and
development of the Customer's Personal Internet Web Page, Service
shall send to Customer a Fulfillment Package (of the form of exhibit
"B," attached hereto) for completion by the Customer. Service shall
provide GTC with the originals of all completed Fulfillment
Packages. All Personal Internet Web Pages covered by this Agreement
shall be hosted on GTC's Internet servers.
5. CUSTOMER SUPPORT. GTC shall have the option to appoint
Service as its Customer Support Representative to the Customers (the
"Support Option"). Should GTC elect to exercise the Support Option,
Service agrees to respond to all customer support calls on a timely
basis and to provide support to Customers with regards to the
operation and maintenance of the Customer's Personal Internet Web
Page. In return, GTC shall pay Service $3.00 for each customer
support call made by a Customer to Service (the "Support Fee").
Service shall provide GTC with an invoice of all such customer
support calls weekly by Friday at 11:30 am, Pacific Standard Time.
GTC shall pay Service the Support Fee within seven (7) days of the
date of such invoices. GTC shall have the right to terminate the
Support Option provided that GTC provide Service with seven (7)
days notice of such termination.
6. NONSOLICITATION. Service, its officers, directors, and
employees, including, but not limited to, Xxxx Xxxxxxx XX, Xxxx
Xxxxxxx, Xxxx Xxxxxxx, and Xxxx Xxxxxxxx, acknowledge that GTC's
relationships with its employees, customers, clients, suppliers,
sponsors and other persons are valuable business assets. To
forestall any use of any such information, Service and its
shareholders, officers, directors, and employees, including but not
limited to, Xxxx Xxxxxxx XX, Xxxx Xxxxxxx, Xxxx Xxxxxxx, and Xxxx
Xxxxxxxx, agree that for the term of this Agreement and for a
period of one (1) year thereafter, Service and its shareholders,
officers, directors, and employees, including, but not limited to,
Xxxx Xxxxxxx XX, Xxxx Xxxxxxx, Xxxx Xxxxxxx, and Xxxx Xxxxxxxx,
shall not, directly or indirectly, attempt to remarket Customers
which have been sold to GTC by Service.
MISCELLANEOUS
7. ENTIRE AGREEMENT. This Agreement sets forth the entire
agreement and understanding of the parties hereto with respect to
the transactions contemplated hereby, and supersedes all prior
agreements, arrangements and understandings related to the subject
matter hereof. No understanding, promise, inducement, statement of
intention, representation, warranty, covenant or condition, written
or oral, express or implied, whether by statute or otherwise, has
been made by any party hereto which is not embodied in this
Agreement or the written statements, certificates, or other
documents delivered pursuant hereto or in connection with the
transactions contemplated hereby, and no party hereto shall be bound
by or liable for any alleged understanding, promise, inducement,
statement, representation, warranty, covenant or condition not so
set forth.
8. NOTICES. All notices provided for in this Agreement shall be
in writing signed by the party giving such notice, and delivered
personally or sent by overnight courier or messenger or sent by
registered or certified mail (air mail if overseas), return receipt
requested, or by telex, facsimile transmission, telegram or similar
means of communication. Notices shall be deemed to have been
received on the date of personal delivery, telex, facsimile
transmission, telegram or similar means of communication, or if sent
by overnight courier or messenger, shall be deemed to have been
received on the next delivery day after deposit with the courier or
messenger, or if sent by certified or registered mail, return
receipt requested, shall be deemed to have been received on the
third business day after the date of mailing. Notices shall be sent
to the addresses set forth below:
If to GTC:
GTC Telecom, Inc.
0000 Xxxxxx Xxxxxx, Xxxxx X-0
Xxxxx Xxxx, XX 00000
Attn: Xxxx Xxxxxx, President
With a copy to:
Law offices of M. Xxxxxxx Xxxxxx, Esq.
000 Xxxxxxx Xxxxxx Xxxxx, Xxxxx 000
Xxxxxxx Xxxxx, XX 00000
Attention: M. Xxxxxxx Xxxxxx
If to Service:
Service One Communications, Inc.
00000 Xxxxx Xxxx., Xxxxx 000
Xxxxxxxxxx Xxxxx, XX 00000
Attn: Xxxx Xxxxxxx XX, President
9. CHOICE OF LAW. This Agreement and the rights of the parties
hereunder shall be governed by and construed in accordance with the
laws of the State of California including all matters of
construction, validity, performance, and enforcement and without
giving effect to the principles of conflict of laws.
10. JURISDICTION. The parties submit to the jurisdiction of the
Courts of the State of California or a Federal Court empaneled in
the State of California for the resolution of all legal disputes
arising under the terms of this Agreement, including, but not
limited to, enforcement of any arbitration award.
11. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of
which shall together constitute one and the same instrument.
12. AMENDMENT AND MODIFICATION. Subject to applicable law, this
Agreement may be amended, modified, or supplemented only by a
written agreement signed by all of the parties hereto.
13. TITLES AND CAPTIONS. All section titles or captions
contained in this Agreement are for convenience only and shall not
be deemed part of the context nor affect the interpretation of this
Agreement.
14. PRONOUNS AND PLURALS. All pronouns and any variations
thereof shall be deemed to refer to the masculine, feminine, neuter,
singular or plural as the identity of the person or persons may
require.
15. AGREEMENT BINDING. This Agreement shall be binding upon the
heirs, executors, administrators, successors and assigns of the
parties hereto.
16. PRESUMPTION. This Agreement or any Section thereof shall not
be construed against any party due to the fact that said Agreement
or any Section thereof was drafted by said party.
17. FURTHER ACTION. The parties hereto shall execute and deliver
all documents, provide all information and take or forbear from all
such action as may be necessary or appropriate to achieve the
purpose of the Agreement.
18. PARTIES IN INTEREST. Nothing herein shall be construed to be
to the benefit of any
third party, nor is it intended that any provision shall be for the
benefit of any third party.
19. SAVINGS CLAUSE. If any provision of this Agreement, or the
application of such provision to any person or circumstance, shall
be held invalid, the remainder of this Agreement, or the application
of such provision to persons or circumstances other than those as to
which it is held invalid, shall not be affected thereby.
WHEREFORE, The parties hereto hereby agree to the foregoing
and execute this Agreement as of the date first above written.
"GTC" "Service"
GTC TELECOM, INC. SERVICE ONE COMMUNICATIONS, INC.
/s/ Xxxx Xxxxxx /s/ Xxxx Xxxxxxx XX
By: Xxxx Xxxxxx, President By: Xxxx Xxxxxxx XX, President