SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to section 13 or 15 (d) of the Securities Exchange Act
April 30, 1999
Date of Report
(Date of Earliest Event Reported)
Americom USA, Inc.
(Exact Name as Specified in its Charter)
Delaware0-02376952-2068322
(State or other (Commission (I.R.S. Employer
jurisdiction of File Number) Identification No.)
incorporation)
1303 Grand Avenue
Arroyo Grande, California, CA 93420
(Address of principal executive offices)
805/542-6700
Registrant's telephone number
CHATSWORTH ACQUISITION CORPORATION
1504 R Street, N.W.
Washington, D.C. 20009
Former name and former address
ITEM 1. CHANGES IN CONTROL OF REGISTRANT
Not applicable.
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
On April 30, 1999 the Company acquired sole
title to the technology known as MyLine and InstAccount,
pursuant to the Agreement of Purchase and Sale and
Exclusive Licensing of Technology with Americom, Ltd.
dated March 11, 1999.
The Agreement provides for the Company to pay aggregate
consideration of (i) $538,000 in cash over a two year
term, (ii) 500,000 shares of common stock of the Company
and (iii) re-conveyance of all shares held in Enhanced
Service Providers, LLC. In exchange, Americom Ltd. has
conveyed all right title and interest to the MyLine and
InstAccount technology, including worldwide marketing
rights, and assigned all trademarks and contracts relating
to MyLine and InstAccount, to the Company. The Company
has assumed certain continuing obligations relating to the
assigned contracts. Americom Ltd. has also undertaken not
to compete with the Company in communications business or
solicit existing MyLine customers.
MyLine is an enhanced, feature rich, remotely programmable
personal telecommunications system. InstAccount is a real
time communications accounting and management tool.
ITEMS 3 through 6.
Not applicable.
ITEM 7. FINANCIAL STATEMENTS
No financial statements are filed herewith. The Company
has acquired the MyLine and InstAccount technology and
related trademarks and contracts free and clear of
pre-existing liabilities and tangible assets.
Accordingly, no financial statements are available for
this acquisition.
ITEMS 8 and 9.
Not applicable.
EXHIBITS
10.1 Agreement of Purchase and Sale and Exclusive
Licensing of Technology with Americom Ltd. dated March 11,
1999.
SIGNATURES
Pursuant to the requirements of the Securities
Exchange Act of 1934, the registrant has duly caused this
report to be signed on its behalf by the undersigned
hereunto duly authorized.
AMERICOM USA, INC.
By: /s/ Robert Cezar
Chief Executive Officer
Dated: June 12, 1999
AGREEMENT OF PURCHASE AND SALE
AND EXCLUSIVE LICENSING OF TECHNOLOGY
This AGREEMENT OF PURCHASE AND SALE AND EXCLUSIVE LICENSING OF
TECHNOLOGY (this "Agreement"), is made effective as of the 11th day
of March, 1999.
B E T W E E N:
AMERICOM LTD., a corporation incorporated under the laws
of
Turks and Caicos, BWI
(hereinafter called the "Seller"),
PARTY OF THE FIRST PART;
- and -
AMERICOM U.S.A., INC., a corporation
incorporated under the laws of the
State of Delaware,in the United States of America,
(hereinafter called the "Purchaser"),
PARTY OF THE SECOND PART;
RECITALS:
WHEREAS, Seller is engaged in the business (the
"Americom Products Business") of developing, marketing,
licensing, and distributing certain technology for the
provision of enhanced communications services, including
certain services marketed by Seller under the names "My
Line" and "InstAccount" (hereinafter referred to as the
"Americom Products").
WHEREAS, it is proposed that the Seller sell and license
to the Purchaser certain assets owned by Seller and used
in the development, marketing, licensing and
distribution of the Americom Products, all upon and
subject to the terms and conditions of this Agreement as
hereinafter set forth.
NOW, THEREFORE. in order to consummate the foregoing
purchase, sale and license and in consideration of the
premises and the representations and undertakings
therein set forth, the parties agree as follows:
SECTION 1. PURCHASE AND SALE OF ASSETS
0.1 Purchase and Sale. Subject to the terms
and conditions contained herein, on the Closing
Date (as hereinafter defined), Seller will both
(i) sell, convey, transfer, assign
and deliver to Purchaser; and
(ii) execute an exclusive (with the
exception of the Contracts set forth
in Exhibit 1.4(b)), irrevocable,
perpetual, royalty-free license in
favor of Purchaser, and Purchaser
shall purchase and license from
Seller, all right, title and interest
in and to those assets and properties
the Technology) more particularly
described in the following
subparagraphs (a) through (1) below:
(a) All source
codes and object
codes comprising
any part of or in
any way used in any
software
applications or
modules
(collectively, the
"Americom
Software") forming
thc basis of or
otherwise used in
connection with the
Americom Products
together with all
tapes, disks,
printouts and other
media on which the
Americom Software
is stored (the
"Principal
Technology"). The
Principal
Technology
includes, without
limitation, the
software printout
delivered with this
Agreement by
Americium which has
been jointly
identified by
parties, a copy of
which is being
retained' at the
offices of
Purchaser's counsel.
(b) All of
Seller's rights
under any
licensing,
marketing, sales or
other arrangements
(collectively,
"Contracts")
pertaining to the
Americom Products
Business, together
with all of
Seller's rights to
revenues to which
the Seller
otherwise would
become entitled
from and after the
date of this
Agreement; provided
that Purchaser
shall have sixty
(60) days to review
and consider the
Contracts, and to
elect, at its
option, to reject
the assignment of
any one or more of
the Contracts;
(c) Those
trademarks, service
marks and trade
names, together
with all U.S. and
foreign
applications for
registration rights
therefor, which are
used by Seller in
the marketing,
distribution,
licensing and sale
of the Americom
Products (the
"Trademarks");
(d) To the
extent reduced to
written or other
tangible form
(including but not
limited to
electronic media),
all drawings,
designs, plans,
manuals, research,
specifications,
formulae,
processes,
know-how,
technology, trade
secrets and other
confidential or
proprietary
information and
other data and
information (to the
extent not
otherwise
encompassed in
paragraphs 1.1 (a)
through (c) above
pertaining in any
way to the Americom
Products or the
Americom Software
or contemplated
improvements,
supplements,
additions to the
Americom Products
or the Americom
Software
(collectively, the
"Other Intellectual
Property Interests");
(e) All
customer lists and
customer files
directly related to
the Americom
Products (the
"Customer Files"); and
(f) All
marketing surveys,
sales records,
sales projections,
marketing plans and
other materials
related to the
marketing of the
Americom Products
(the "Marketing
Materials").
1.2 No Other Assets. No other assets owned or used
by Seller shall be included in the purchase and license,
except to the extent they are listed in Section 1.1 above.
1.3 No Rights to Trademarks or Tradenames. Except to
the limited extent provided in Section 1.1 (c), no
rights are to be transferred hereunder to Purchaser in
any trademarks and tradenames owned or used by Seller,
or any of its affiliated companies, subsidiaries or
divisions.
1.4 Transfer Documents. All of the assets to be
transferred to Purchaser under this Agreement shall be
conveyed by bills of sale, assignments, or other
instruments (the "Transfer Documents") which shall
contain appropriate representations that Seller has good
and marketable title, free and clear of all liens and
encumbrances to the same. The Transfer Documents shall
include the following:
(a) A bill of sale (the "Bill of
Sale") in the form attached hereto as
Exhibit 1.4(a) with respect to the
Principal Technology, Other
Intellectual Property Interests,
Customer Files, and Marketing Materials;
(b) An assignment of contracts
(the "Assignment of Contracts") in the
form attached hereto as Exhibit 1.4(b)
with respect to the Contracts,
provided that said assignment
documentation shall provide that
Purchaser shall have sixty (60) days
to review and consider the Contracts,
and to elect, at its option, to reject
the assignment of any one or more of
the Contracts;
(c) An assignment of trademarks
(the "Assignment of Trademarks") in
the form attached hereto as Exhibit
1.4(c) with respect to each of the
Trademarks; and
(d) A License Agreement in the
form attached hereto as Exhibit 1.4(d)
with respect to any and all of the
Technology.
SECTION 2. CONSIDERATION, PAYMENT
In consideration of the sale and license of the
Technology set forth in Section 1, Purchaser shall make
the following payments and provide the following
consideration to Seller:
1.1 As a deposit the sum of THIRTY-EIGHT
THOUSAND DOLLARS ($38,000) on the execution of
this Agreement;
1.2 At the Closing, Purchaser shall deliver
to the Seller by wire transfer in accordance
with "Exhibit 2.2" the sum of ONE HUNDRED
THOUSAND DOLLARS ($100,000.00);
1.3 Short Term Note. At the Closing,
Purchaser shall deliver to Seller a promissory
note bearing interest at the rate of Eight (8%)
percent per annum (the "Promissory Note") in
the principal amount of Four Hundred Thousand
Dollars ($400,000.00) repayable as follows:
(i) A lump sum payment of TWO
HUNDRED THOUSAND DOLLARS ($200,000.00)
is due and payable on the first
anniversary date of the Promissory
Note; and
(ii) A second lump sum payment of
TWO HUNDRED THOUSAND DOLLARS
($200,000.00) plus any and all accrued
and unpaid interest owing under the
note is due and payable on the second
anniversary date of the (Promissory
Note).
The Promissory Note is to be in such form as is attached
hereto as Exhibit 2.3
2.1 Shares of Purchaser. At the Closing,
Purchaser shall allot and issue to the Seller
FIVE HUNDRED THOUSAND (500,000) Common Shares
(the "Shares") out of the capital of the
Purchaser. It is agreed and understood between
the parties that the present value of the
Shares is TWO DOLLARS ($2) per share and has a
current value of ONE MILLION DOLLARS
($1,000,000.00). The parties agree that there
shall be no adjustment of the Purchase Price
hereafter should there be any change in value
of the Shares.
2.2 Transfer of Shares of Enhanced Service
Providers, LLC. At the Closing, Purchaser shall
deliver all documentation required to assign
and transfer all of the shares held by
Purchaser in the capital of Enhanced Service
Providers, LLC (the "ESP Shares") to the Seller.
SECTION 3. LIABILITIES
3.1 Liabilities To Be Assumed. Purchaser agrees to
deliver to Seller at the Closing an assumption document
(the "Assumption Document") in the form set forth in
Exhibit 3.1 attached hereto pursuant to which Purchaser
assumes Seller's obligations to perform those
obligations of Seller under the Contracts which by their
terms are to be performed after the Closing Date;
provided that Purchaser shall retain the right to elect,
during the sixty (60) day period following the Closing,
to reject the assignment of any Contract;
3.2 Liabilities Not Assumed. Except as Purchaser
shall specifically otherwise agree in writing, Seller
shall retain full and sole responsibility for all
obligations and liabilities with respect to the
development, marketing, distribution, licensing and sale
of the Americom Products except for those liabilities
specifically assumed in the Assumption Document,
including without limitation:
(a) any
liability in
respect of or
arising out of any
of the Americom
Products which were
licensed or sold
prior to Closing;
(b) any
liability for
failure of the
Americom Products
to perform
according to
specification or as
intended prior to
the Closing Date;
(c) any
liability or
obligations
involving the
payment of any
taxes arising out
of or relating to
the operation of
the Americom
Products Business
by the Seller prior
to the Closing;
(d) any
liability or
responsibility with
respect to claims
for credit by third
parties with
respect to Products
licensed or sold
prior to the
Closing; and
(e) any
liability or
obligation to any
third parties not
expressly assumed
in the Assumption
Document.
SECTION 4. REPRESENTATIONS AND WARRANTIES OF SELLER
Seller represents and warrants to Purchaser as follows:
3.1 Corporate Status. Seller is a
corporation duly organized, validly existing
and in good standing under the laws of Turks
and Caicos, and is duly qualified to transact
business as a foreign corporation in such other
jurisdictions in which its ownership of the its
assets or its operation of the Americom
Products Business requires it to be so
qualified. Seller has all requisite corporate
power and authority to own or lease and operate
the assets owned or used by it and carry on the
Americom Products Business as presently being
conducted by it and to execute, deliver and
perform this Agreement and all other
agreements, certificates and other documents
being delivered by it at or prior to the
Closing in connection with transactions
contemplated hereby, and to consummate the
transactions contemplated hereby.
3.2 Authority. The execution and delivery
of this Agreement, the consummation of the
transactions provided for herein, and the
execution and delivery of all other agreements,
instruments and documents to be delivered
hereunder have been duly authorized by all
necessary action on the part of Seller, and
this Agreement, and all other agreements,
instruments and documents to be delivered by
Seller hereunder constitute and will constitute
valid and legally binding obligations of Seller
enforceable against Seller in accordance with
their terms subject to general principles of
equity and except to the extent enforceability
may be limited by bankruptcy, insolvency,
moratorium or other similar laws affecting the
enforcement of creditors' rights generally.
3.3 No Conflict With Other Agreements. The
execution, delivery and performance of this
Agreement and any other agreements, instruments
and documents to be delivered hereunder by
Seller and the consummation of the transactions
contemplated by this Agreement will not (a)
result in the breach of any term or provision
of the charter or by-laws of Seller, or (b)
constitute a default under or result in
violation of any existing indenture, contract,
agreement, or other instrument to which such
Seller is a party or by which it or any of its
property is bound or any applicable law,
statute, decree, order, rule, or regulation of
any court, regulatory body or administrative
agency that is binding on Seller.
3.4 Title to Technology. Seller has good
title to all the Technology free and clear of
all liens, claims, security interests and
encumbrances (except liens for taxes not yet
due and payable).
3.5 Condition of Technology. The Technology
is free from defects in design and operation
(except such minor: defects as do not interfere
with the continued use thereof in the conduct
of normal operations). Without limiting the
generality of the foregoing, the Americom
Software fully supports each of the Americom
Products and each capability of the Americom
Products free of major defects that interfere
with the continued operation of the Americom
Products.
3.6 Contracts. The Contracts constitute all
agreements, contracts and commitments to which
Seller is a party or by which it is bound and
which relate to any licensing, sales, marketing
or distribution arrangement concerning the
Americom Products Business. Seller has provided
Purchaser with complete and accurate copies of
all such agreements, contracts and commitments.
3.7 Employment Contracts. Seller has not
entered into and is not in any way bound to any
contract of employment (or other arrangement
other than employment-at-will) with any
employee of the Seller, which contract or
arrangement specifically provides for the
employment of such employee in the Sellers
Americom Products Business.
3.8 Compliance with Law; Litigation. Seller
has complied with, and is not in violation of,
applicable Turks and Caicos, international,
U.S. federal, state and local statutes, laws,
rules and regulations, which the failure to
comply with would materially affect the use of
any of the Technology and the operation of the
Americom Products Business or Seller's ability
to perform its obligations hereunder or which
the failure to comply with would have a
material adverse effect on the reputation and
goodwill associated with the Americom Products.
There are no suits, actions, arbitrations, or
legal, administrative or other proceedings, or
governmental investigations, pending or
threatened against Seller in which there is a
reasonable possibility of an adverse decision
that could adversely affect Seller's ability to
perform its obligations hereunder or that may
affect the Technology or the operation of the
Americom Products Business or that would have
an adverse effect on the reputation and
goodwill associated with the Americom Products.
Seller is not subject to any injunction, order
or decree of any court or administrative agency
that may have an adverse effect on the ability
of Seller to perform its obligations hereunder
or that may affect the Technology or the
operation of the Americom Products Business.
3.9 Brokerage or Finder's Fees. Seller has
not engaged the service of any broker or finder
in connection with the sale of the Americom
Products Business. There is no broker, finder
or other person who has any valid claim against
Purchaser for a commission, finder's fee or
brokerage fee in connection with this Agreement
or the consummation of the transactions
contemplated hereby by virtue of any actions
taken by Seller.
3.10 Consents and Approvals. Neither the
execution and delivery of this Agreement by
Seller nor compliance by Seller with any of the
provisions hereof shall require any consent,
approval, authorization of, or filing with or
notification to, any governmental or regulatory
authority.
3.11 Trademarks. The Trademarks constitute
all of the trademarks, service marks and trade
names utilized by Seller in connection with the
Americom Products. Seller is the owner of all
of the Trademarks. None of the Trademarks,
whether or not registered, infringes on the
trademarks of any other person, nor is there
any pending claim of such infringement.
3.12 Software. No portion of the Americom
Software, whether expressed in source or object
code and when or not copyrighted or
copyrightable, requires (i) the payment of any
royalty to any person or entity or (ii) the
consent of any third party to the assignment
thereof and the same is freely transferable by
the Seller. Seller is not a party to nor the
subject of any outstanding orders, decrees,
judgments or stipulations which would adversely
impact the rights of Seller or upon
communication of this transaction, Purchaser to
sell, use, license, market, sell and distribute
the Americom Software, nor is Seller a party to
or the subject of any suits, actions,
arbitrations, claims or legal administrative or
other proceedings, or governmental
investigations alleging or otherwise claiming
that the Americom Software infringes upon the
intellectual or industrial property interests
of any third party. The Seller is not aware of
any infringement by any third party with
respect to Seller's intellectual and industrial
property rights with respect to the Americom
Software. Except as specifically included in
the Contracts, the Seller has not granted to
any third party a license, whether exclusive or
non-exclusive, with respect to the Americom
Software. The development, marketing,
licensing, distribution and sale of the
Americom Products does not infringe upon or
otherwise violate any patents, copyrights or
other intellectual property or industrial
property interests of any third party, nor are
there any suits, actions, arbitrations, claims
or legal, administrative or other proceedings,
or governmental investigations pending or
threatened against Seller alleging that the
development, marketing, licensing, distribution
and sale of the Americom Products infringes
upon the intellectual or industrial property
interests of any third party.
3.13 Intellectual Property Interests Not in
Tangible Form. To the best of Seller's
knowledge, there are no designs, plans,
research, specifications, formulae, processes,
know-how, technology, trade secrets or other
confidential or proprietary information or
other data and information which (i) are
material to the development, marketing,
licensing, distribution or sale of the Americom
Products or contemplated improvements,
supplements or additions to the Americom
Products and (ii) are not currently reduced to
written or other tangible form (including,
without limitation, electronic media).
3.14 Necessary Technology. The Technology
constitute all of the tangible or intangible
assets (including designs, specifications,
know-how, technology, trade secrets and
marketing materials and plans) which are
necessary or convenient to enable Purchaser,
following the Closing, to conduct the Americom
Products Business in the same manner and to the
same extent as heretofore conducted by the Seller.
3.15 Disclosure. No representation or
warranty in this Section, and no statement
contained elsewhere in this Agreement or in any
Schedule, Exhibit, Certificate or other
document furnished or to be furnished to
Purchaser pursuant hereto or in connection with
the transactions contemplated under this
Agreement, contains or will contain any untrue
statement of a material fact or omits or will
omit to state a material fact or any fact
necessary to make the statements contained
therein not materially misleading when taken as
a whole. To the best of Seller's knowledge,
there is no fact which adversely affects or may
in the future have a material adverse effect on
the business, properties, assets, operations,
affairs, or condition (financial or otherwise)
of the Americom Products Business which has not
been specifically described herein or in one of
the Schedules to this Agreement.
3.16 Shares of Purchaser. Seller (i) has
been provided with an opportunity to ask
questions of and receive answers from
Purchaser, or its representatives, concerning
the operations, business and financial
condition of Purchaser, and all such questions
have been answered to Seller's full
satisfaction and any information necessary to
verify such responses has been made available
to it; (ii) has received such documents,
materials and information as Seller deems
necessary or appropriate for evaluation of the
Shares, and further confirms that Seller has
fully read and understands these materials and
has made such further investigation as Seller
deems appropriate to obtain additional
information to verify the accuracy of such
materials; (iii) confirms that the Shares were
not offered to it by means of general
solicitation or general advertising; (iv) has
such knowledge and experience in financial and
business matters that it is capable of
evaluating the merits and risks of an
investment in the Shares; (v) is acquiring the
Shares for its own account, for investment
purposes only, and not with a view toward sale
or the distribution thereof, in whole or in
part; (vi) understands that the Shares have not
been registered under the securities laws of
any state or under the Securities Act of 1933,
as amended, and are offered in reliance on
exemptions therefrom, and that the Shares have
not been approved or disapproved by the
Securities and Exchange Commission or any other
federal or state agency; and (vii) understands
that there are restrictions on the
transferability of the Shares and that it may
not be possible for Seller to sell or otherwise
transfer the Shares and accordingly, that the
Seller may have to hold the Shares and bear the
economic risks of the investment for an
extended period of time. Acquisition for
Investment. The Shares being issued to the
Vendor pursuant to this Agreement are being
acquired by the Vendor in good faith solely for
the Vendor's own account, for investment and
not with a view toward resale or other
distribution within the meaning of the
Securities Act. The Vendor further represents
that the Shareholder has no present contract,
undertaking, agreement or arrangement with any
person to sell, transfer or grant participation
to such person or to grant to any third person
with respect to any share of Parent Corporation
Common Stock. The shares of Parent Corporation
Common Stock being issued to the Shareholder
pursuant to this Agreement will not be offered
for sale, sold or otherwise transferred by the
Shareholder without either registration or
exemption from registration under the
Securities Act.
3.17 Evaluation of Merits and Risks of
Investment. The Seller has such knowledge and
experience in financial and business matters
that the Seller is capable of evaluating the
merits and risks of the Seller's investment in
the Shares being acquired hereunder. The
Shareholder further represents that the Seller:
(i) has obtained all information available
pursuant to any 8K's filed and all other
documentation available from the NASD; (ii) has
received all the information that the Seller
has that the Seller considers necessary or
appropriate for deciding whether to accept the
Shares being issued to the Seller pursuant to
this Agreement; (iii) has the ability to bear
the economic risks of the Seller's prospective
investment; and (iv) is able, without
materially impairing the Seller's financial
condition, to hold the Shares for an indefinite
period of time and to suffer complete loss on
the Seller's investment. The Seller confirms
that Purchaser has made available to the Seller
and its representatives and agents the
opportunity to ask questions of the officers
and management employees of Purchaser about the
business and financial condition of Purchaser
as the Seller has requested.
3.18 Forward Looking Information/ Risk
Factors. The Seller acknowledges and agrees
that any oral or written forward-looking
statements made by or on behalf of Purchaser in
connection with the sale herein contemplated
were made in the context of and shall have been
deemed to have been accompanied by the risk
factors set forth in Purchaser's Annual Report
on Form 10-K for the fiscal year ended October
31, 1997, on file with the Securities and
Exchange Commission (the "Commission"), and
Purchaser's Quarterly Report on Form 10-Q for
the three months ended January 31, 1998. The
Seller acknowledges that actual results could
differ materially from those projected in or
implied by any forward-looking statement.
3.19 Transfer Limitations. The Seller
further agrees that unless transferred in
compliance with Rule 144 promulgated under the
Securities Act ("Rule 144") promulgated under
the Securities Act, prior to any proposed
transfer of any of the shares of Purchaser,
unless there is in effect a registration
statement under the Securities Act covering the
proposed transfer, the Seller shall give
written notice to Purchaser of the Seller's
intention to effect such transfer. Each such
notice shall describe the manner and
circumstances of the proposed transfer in
sufficient detail, and shall, if Purchaser so
requests, shall be accompanied by either (a) a
written opinion of legal counsel who shall be
satisfactory to Purchaser, addressed Purchaser
and satisfactory in form and substance to
Purchaser's counsel, to the effect that the
proposed transfer of Purchaser Common Stock may
be effected without registration under the
Securities Act, or (b) a "No Action" letter
from the Commission to the effect that the
transfer of such securities without
registration will not result in a
recommendation by the staff of the Commission
that action be taken with respect thereto,
whereupon the holder of such Purchaser Common
Stock shall be entitled to transfer such shares
of Purchaser Common Stock in accordance with
the terms of the notice delivered by the holder
to Purchaser. Each certificate evidencing the
Shares transferred as above provided shall bear
the appropriate restrictive legend set forth in
Section 5.3 below, except that such certificate
shall not bear such restrictive legend if in
the opinion of counsel for Purchaser such
legend is not required in order to establish
compliance with any provisions of the
Securities Act.
3.20 Rule 144 Limitations. The Seller is
familiar with the provisions of Rule 144, which
in substance permits the limited public resale
of "restricted securities" acquired, directly
or indirectly from the issuer thereof (or from
an affiliate of such issuer) in a non-public
offering subject to the satisfaction of certain
conditions. The Seller further understands
that in the event all of the applicable
requirements of Rule 144 are not satisfied,
registration under the 1933 Act or compliance
with a registration exemption would be required
to sell the Shares received from Purchaser
hereunder. With a view to making available the
benefits of certain rules and regulations of
the Commission, which may permit the sale to
the public without registration of the shares
of Purchaser being issued to the Seller
pursuant to this Agreement, Purchaser agrees,
for a period of two years following the Closing
Date, to use reasonably diligent efforts to:
(a)
make and keep
public information available, as those
terms are understood and defined in
Rule 144, at all times after the
effective date that Acquiring
Corporation becomes subject to the
reporting requirements of the
Securities Exchange Act of 1934, as
amended (the "Exchange Act");
(b)
file with the
Commission in a timely manner all
reports and other documents required
of Acquiring Corporation under the
Securities Act and the Exchange Act; and
(c) so long as any of the Shareholders owns
any shares of Parent Corporation Common Stock
being issued pursuant to this Agreement, to
furnish to the Shareholder forthwith upon
request a written statement by Acquiring
Corporation as to its compliance with the
reporting requirements of Rule 144, a copy of
the most recent annual or quarterly report of
Acquiring Corporation and such other reports
and documents of Acquiring Corporation and
other information in the possession of or
reasonably obtainable by Acquiring Corporation
as the Shareholder may reasonably request in
availing itself of any rule or regulation of
the Commission allowing the Shareholder to sell
any such shares of Parent Corporation Common
Stock without registration.
SECTION 5.
REPRESENTATIONS AND WARRANTIES OF PURCHASER
Purchaser represents and warrants to Seller as follows:
4.1 Status. Purchaser is a corporation
incorporated under the laws of the State of
Delaware, of the United States of America duly
organized and validly existing and in good
standing under the said laws of the State of
Delaware, and is duly qualified to transact
business as a corporation in such other
jurisdictions in which its ownership of its
assets or its operation of a business including
the Americom Products Business shall require it
to be so qualified. Purchaser has all requisite
power and authority to own or lease and operate
or carry on the Americom Products Business as
presently being conducted and to execute,
deliver and perform this Agreement and all
other agreements, certificates and other
documents being delivered at or prior to the
Closing in connection with the transactions
contemplated hereby and to consummate the
transactions contemplated hereby.
4.2 Authority. The execution and delivery
of this Agreement, the consummation of the
transactions provided for herein, and the
execution and delivery of all other agreements,
instruments and documents to be delivered
hereunder by Purchaser have been duly
authorized by all necessary action on the part
of Purchaser, and this Agreement, and all other
agreements, instruments and documents to be
delivered hereunder constitute and will
constitute valid and legally binding
obligations of Purchaser enforceable against
Purchaser in accordance with their terms
subject to general principles of equity and
except to the extent enforceability may be
limited by bankruptcy, insolvency, moratorium
or other similar laws affecting the enforcement
of creditors' rights generally.
4.3 No Registration Under the Securities
Act. The Vendor understands that the Shares to
be issued to the Vendor under this Agreement
have not been and will not be registered under
the Securities Act of 1933, as amended (the
"Securities Act"), in reliance upon exemptions
contained in the Securities Act or
interpretations thereof, and cannot be offered
for sale, sold or otherwise transferred unless
the Shares are so registered or qualify for
exemption from registration under the
Securities Act. The Vendor acknowledges and
agrees that each certificate representing the
Shares issued pursuant to this Agreement, and
any shares issued or issuable in respect of any
of the Shares upon any stock split, stock
dividend, recapitalization, or similar event,
shall be imprinted with a legend in
substantially the following form (in addition
to any legend required under applicable state
securities laws):
THE SECURITIES REPRESENTED
BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES
ACT"), AND MAY NOT BE TRANSFERRED OR
SOLD OTHER THAN (I) PURSUANT TO AN
EFFECTIVE REGISTRATION UNDER THE
SECURITIES ACT AND OTHER APPLICABLE
STATE SECURITIES LAWS OR AN AVAILABLE
EXEMPTION FROM SUCH REGISTRATION, AND
(II) UPON RECEIPT BY THE ISSUER OF
EVIDENCE SATISFACTORY TO IT OF
COMPLIANCE WITH THE SECURITIES ACT AND
OTHER APPLICABLE STATE SECURITIES
LAWS. THE ISSUER SHALL BE ENTITLED TO
REQUIRE AN OPINION OF COUNSEL
SATISFACTORY TO IT WITH RESPECT TO
COMPLIANCE WITH THESE REQUIREMENTS.
THE CERTIFICATES EVIDENCING
THE SHARES TO BE ISSUED TO THE
SHAREHOLDER UNDER THIS AGREEMENT SHALL
ALSO BEAR ANY LEGEND REQUIRED BY THE
COMMISSIONER OF CORPORATIONS OF THE
STATE OF CALIFORNIA OR SUCH AS ARE
REQUIRED PURSUANT TO ANY STATE, LOCAL
OR FOREIGN LAW GOVERNING SUCH SECURITIES.
SECTION 6. OTHER AGREEMENTS AND COVENANTS
6.1 Non-Competition Agreement. On the Closing Date,
Seller and Purchaser shall enter into a non-competition
agreement (the "Non-Competition Agreement") in the form
attached hereto as Exhibit 6.1.
6.2 Assigned Contracts. To the extent that any of
the Contracts to be assigned hereunder are not
assignable without the consent of another party, this
Agreement shall not constitute an assignment or an
attempted assignment thereof or an assumption or an
attempted assumption thereof, if such assignment or
attempted assignment or assumption or attempted
assumption would constitute a breach thereof. Seller
agrees to use reasonable efforts to obtain any necessary
consent to assumption or assignment of the Contracts,
and, if necessary, to fulfill all obligations
thereunder, subject to the undertaking that Purchaser
likewise shall fulfill its obligations.
6.3 Further Assurances; Consents. From time to time
following the Closing, without further consideration,
each party, at its own expense, shall execute and
deliver such documents to the other party as such other
party may reasonably request in order more effectively
to consummate the transactions contemplated hereby,
including without limitation the transfer of all
tangible or intangible assets necessary to make the
representations contained in Section 4.14 of this
Agreement true and correct. In the case of contracts,
agreements, and rights that may not be transferred and
assigned to Purchaser without the consent of a party
whose consent has not been obtained by the Closing Date,
Seller and Purchaser shall use their reasonable efforts
to obtain such consents as soon as practicable
thereafter. Without limiting the generality of the
foregoing, Seller also covenants, at Seller's own cost
and expense, to execute and deliver such documents and
take such further action as Purchaser may request in
order to enable Purchaser to file and prosecute any
application for patent, copyright, trademark or other
intellectual or industrial property protection with
respect to the Technology.
6.4 Litigation Cooperation. In the event that Seller
or Purchaser shall become a party to litigation,
arbitration or administrative proceedings not involving
the other party hereto related to claims of patent,
trademark or copyright infringement with respect to the
Technology, the party not involved in such litigation,
arbitration or administrative proceeding shall, at the
request of the party so involved, cooperate with such
requesting party by providing to the requesting party
such information, records and testimony as such
requesting party may reasonably request in the
prosecution, defense or conduct of such litigation,
arbitration or administrative proceeding. The requesting
party shall reimburse the other party for all reasonable
expenses incurred by such other party in providing such
information, records and testimony.
SECTION 7. CONDITIONS PRECEDENT TO OBLIGATIONS
OF PURCHASER
The performance of the obligations of Purchaser under
this Agreement is subject, at the election of Purchaser,
to the fulfillment of each of the following conditions
by Seller on or before the Closing:
7.1 Continuation and Truth of Representations and
Warranties. The representations and warranties of Seller
contained in this Agreement or in any certificate or
document delivered to Purchaser pursuant hereto shall be
true and correct in all material respects on the date
hereof and shall be deemed to have been made again at
the Closing and speak as of the Closing Date and shall
then also be true and correct in all material respects.
7.2 Compliance by Seller. Seller shall have
performed and complied in all material respects with all
terms, covenants and conditions required by this
Agreement to be performed or complied with by Seller on
or before the Closing Date.
7.3 Adverse Occurrences. There shall not have
occurred any event or act, whether or not under the
control of Seller, which in Purchaser's reasonable
discretion has a material adverse effect on the value of
the Technology, including but not limited to the
discovery of any design or operational defect in the
cancellation of key Contracts, receipt of a claim that
the use of the Technology infringes the intellectual
property rights of any third party or any event
adversely affecting the goodwill associated with the
Trademarks.
7.4 Legal Proceedings. There shall be no law, and no
order shall have been entered and not vacated by a court
or administrative agency of competent jurisdiction,
which (a) enjoins, restrains, makes illegal or prohibits
consummation of the transactions contemplated hereby or
(b) restricts or interferes with, in any material way,
the utilization of the Technology after the Closing, and
there shall be no litigation pending before a court or
administrative agency of competent jurisdiction, or
threatened, seeking to do, or which, if successful,
would have the effect of, any of the foregoing.
7.5 Opinion of Counsel to Seller. Purchaser shall
have been furnished with opinion of Twa, Cochrane,
Scatfeld & Associates, general counsel for Seller, dated
as the Closing Date, to the effect that:
(a) Seller is a corporation duly organized,
validly existing and in good standing under the
laws of Turks and Caicos and is duly qualified
to transact business as a foreign corporation
in such other jurisdictions in which its
ownership of the Technology or operation of its
business, including the Americom Products
Business, requires it to be so qualified.
Seller has all corporate power and authority
necessary to own or lease and operate its
assets and to conduct the Americom Products
Business as now being conducted by it, and has,
all requisite corporate power and authority to
execute, deliver and perform this Agreement and
all other agreements, certificates and other
documents being delivered by it at or prior to
the Closing in connection with the transactions
contemplated hereby, and to consummate the
transactions contemplated hereby.
(b) The execution, delivery and performance
of this Agreement by Seller have been duly
authorized and approved and fully transfers
complete and exclusive ownership of the
Technology to Purchaser. Performance by
Americom under this Agreement or any ancillary
agreement or instrument, will not require any
consent or approval, violate any order of any
court or other agency of government or any
contract, indenture, agreement, or other
instrument to which Americom is a party, or by
which Americom is bound, or be in conflict
with, result in a breach of, or constitute
(with due notice or lapse of time or both) a
default under, or result in the creation or
imposition of any material lien, charge, or
encumbrance of any nature whatsoever upon any
of the property or assets of Americom. Neither
the execution and delivery, nor the performance
of this Agreement, by Seller violates any
provisions of the charter or the by-laws of
Seller, any provision of any law, regulation or
order of any judicial, administrative or
arbitral body, or any provision of any
contract, obligation, indenture, agreement or
other instrument to which Seller is a party.
(c) There is no action, suit or proceeding
at law or in equity or by or before any
governmental instrumentality or other agency
now pending or threatened against or affecting
Americom which, if adversely determined, could
reasonably be expected to have a material
adverse effect on the ability of Americom to
execute, deliver or perform under this
Agreement. To our knowledge, no claims have
been asserted against Seller by any person
challenging the ownership or use of any of the
Technologies by Seller or challenging or
questioning the validity or effectiveness of
such Technologies.
(d) Each of this Agreement and any other
agreement or instrument delivered pursuant
hereto by Seller has been duly executed and
delivered by Seller and constitutes a legal,
valid and binding obligation of Seller in
accordance with its terms subject to general
principles of equity, and except as the
enforceability thereby may be limited by
bankruptcy, insolvency or other laws affecting
the rights of creditors, generally.
(e) Seller is the owner of all right, title
and interest in and to the Technology, free and
clear of all liens, claims, security interests
and encumbrances and has full power and
authority to transfer and license all such
right, title and interest to Purchaser. The
use, development, marketing, licensing,
distribution and sale of the Technology by the
Purchaser anywhere throughout the world, upon
consummation of the transactions contemplated
herein, will not violate or otherwise infringe
upon the contractual, intellectual or
industrial property interests of any third party.
7.6 Certificate. Purchaser shall have been furnished
with a certificate by the President or of any duly
authorized corporate officer of Seller, certifying, in
such form as the Purchaser may reasonably request, as to
the fulfillment of the conditions set forth in Sections
7.1, 7.2, and 7.3.
SECTION 8. CLOSING
The closing of the transactions contemplated by this
Agreement (the "Closing") shall be held on the 30th day
of April, 1999 or such other date as the parties shall
mutually agree in writing (the "Closing Date"). The
Closing shall occur at the offices of Twa, Cochrane,
Skatfeld, Providenciales, Turks and Caicos, BWI or at
such other place or date as may be fixed by mutual
agreement of Purchaser and Seller.
SECTION 9. RESPONSIBILITIES OF SELLER AT THE CLOSING
At the Closing, Seller shall:
(a) Deliver to Purchaser the Bill of Sale;
(b) Deliver to Purchaser the Assignment of
Contracts;
(c) Deliver to Purchaser the Assignment of
Trademarks;
(d) Deliver to Purchaser the opinion of
its counsel; and
(e) Deliver to Purchaser such other
documents as are necessary or appropriate
pursuant to this Agreement.
SECTION 10. RESPONSIBILITIES OF PURCHASER AT THE CLOSING
At the Closing, Purchaser shall:
(a) Wire transfer in accordance Exhibit 2.2
to be received by the Seller on or before
Closing the $100,000.00 payable on closing;
(b) Deliver the Promissory Note;
(c) Issue the Shares;
(d) Deliver the transfer documentation
regarding the ESP Shares;
(e) Execute and deliver to Seller the
Assumption Document;
(f) Deliver to Seller the opinion of its
counsel;
(g) Deliver to Seller such other
documents as are necessary or appropriate
pursuant to this Agreement.
SECTION 11. INDEMNIFICATION
11.1 Indemnification by Seller. From and after the
Closing, Seller shall defend (with counsel reasonably
acceptable to Purchaser), indemnify and hold Purchaser
and its officers, managers, members, employees,
consultants, agents and representatives wholly harmless
from and against any and all liability, loss, cost and
expense whatsoever (including reasonable fees of legal
counsel) that may be incurred by Purchaser ("Purchaser
Claim") as a result of any one or more of the following:
(a) Seller's
failure to perform
any of its
agreements
contained herein or
in any instrument
delivered in
connection herewith
or to pay any of
its liabilities or
to perform any of
its obligations not
expressly assumed
by Purchaser
hereunder;
(b) The breach
or inaccuracy of
any of the
representations or
warranties made by
Seller in this
Agreement or in any
certificate or
document delivered
pursuant hereto; and
(c) A claim by
a third party which
arises from an
obligation or
liability not
expressly assumed
by Purchaser
hereunder,
including without
limitation those
liabilities of
Seller not
expressly assumed
by Purchaser as
identified in
Section 3.2 hereof
and any taxes
payable by Seller
in any jurisdiction.
11.2 Indemnification by Purchaser. From and after the
Closing, Purchaser shall defend (with counsel reasonably
acceptable to Seller), indemnify and hold Seller and its
officers, directors, shareholders, employees,
consultants, agents and representatives wholly harmless
from and against any and all liability, loss, cost and
expense whatsoever (including reasonable fees of legal
counsel) that may be incurred by Seller ("Seller Claim")
as a result of any one or more of the following:
(a) Purchaser's
failure to perform
any of its
agreements
contained herein or
in any instrument
delivered in
connection herewith
or to pay any
liabilities or to
perform any
obligations
expressly assumed
or undertaken by
Purchaser pursuant
to the terms hereof;
(b) The breach
or inaccuracy of
any of the
representations or
warranties made by
Purchaser in this
Agreement or in any
certificate or
document delivered
pursuant hereto; and
(c) A claim by a third party which
arises from an obligation or liability
expressly assumed by Purchaser hereunder.
11.3 Manner of Payment of Finally Determined Claims.
The amount of any liability, loss, cost, or expense for
which Purchaser or Seller shall be finally determined to
have an obligation to indemnify the other pursuant to
this Section shall be paid by the indemnifying party to
the indemnified party no later than thirty (30) days
after such final determination.
11.4 Procedure for Obtaining Indemnification
(a) In the event that either Seller or
Purchaser shall claim that it is entitled
to be indemnified pursuant to the terms of
this Section, it (the "Claiming Party")
shall so notify the other party (the
"Indemnifying Party") in writing of such
claim. Such notice shall specify the basis
of such claim and the liability, loss, cost
or expense incurred by, or imposed upon,
the Claiming Party on account thereof. If
such liability, loss, cost or expense is
liquidated in amount, the amount stated in
such notice shall be deemed the amount of
the claim of the Claiming Party as of the
date of such notice, provided that the
statement of such amount shall not prevent
or limit the Claiming Party from making
claims for additional liability, loss, cost
or expense which relate to the basis of the
claim and which are incurred after, or are
unknown at, the time of the notice. If the
amount is not liquidated, the notice shall
so state and, in such event, a claim shall
be deemed asserted against the Indemnifying
Party on behalf of the Claiming Party, but
no payment shall be made on account thereof
until the amount of such claim is
liquidated and the claim is finally
determined.
(b) If the Indemnifying Party shall
not, within twenty (20) days after the
receipt of such notice, advise the Claiming
Party, in writing, that it denies the right
of the Claiming Party to indemnity in
respect to a claim, then the amount of such
claim, at once if said claim is liquidated,
or subsequently at such time as any
unliquidated claim has become liquidated,
shall be deemed to be finally determined
between the parties hereto subject to
additional claims.
(c) If the Indemnifying Party shall
notify the Claiming Party that it disputes
any claim made by the Claiming Party, then
the parties hereto shall endeavor to settle
and compromise said claim, or may agree to
submit the same to arbitration. If they are
unable to agree on any settlement or
compromise or submission to arbitration,
such claim for indemnification shall be
settled by appropriate litigation, and any
liability established by reason of such
settlement, compromise, arbitration or
litigation, shall be deemed to be finally
determined and shall be paid and satisfied
in accordance with this Section.
(d) Each party shall promptly give written notice to
the other of any claim of a third party which may
reasonably be expected to result in a claim by the
Claiming Party against the other Indemnifying Party. The
Indemnifying Party shall undertake the defense of such
claim with counsel reasonably acceptable to the Claiming
Party; provided, however, that the Claiming Party shall
be entitled to participate in such defense with counsel
selected by it and at its expense (in which case counsel
for the Indemnifying Party and for the Claiming Party
shall consult and cooperate at all times in defending
against such a claim). If the Indemnifying Party (i)
fails to give adequate written assurance to the Claiming
Party of its willingness to undertake the defense of
such claim or (ii) fails to undertake in a timely and
proper manner the defense of such claim, the Claiming
Party, upon such additional notice to the Indemnifying
Party, shall have the exclusive right to defend,
compromise or settle such claim in such manner as the
Claiming Party deems appropriate. In such event, the
Claiming Party shall remain entitled to indemnification
by the Indemnifying Party to the fullest extent provided
for under this Section. In no event may the Indemnifying
Party settle, compromise or otherwise resolve any claim
unless the terms of such settlement, compromise or
resolution include a complete release of the Claiming
Party of any liability with respect thereto.
11.5 Right of Setoff with Regard to the Notes. Until
such time as the Long Term Note has become due and
payable in accordance with the terms thereof, Purchaser
shall have the right to recover any Purchaser Claims by
setting off, in the manner set forth in this Section,
with respect to the principal and interest accrued and
outstanding under such Note, the Setoff Amount as
defined in subparagraph (c) below.
(a) Purchaser shall give written notice
(the "Claim Notice") to Seller of any claim by
the Purchaser for Purchaser Claims, which
written notice shall set forth in reasonable
detail (i) the amount of Purchaser Claims which
the Purchaser claims to have sustained by
reason thereof and (ii) the basis of the claim
therefor.
(b) For a period of thirty (30) days from
its receipt of a Claim Notice from Purchaser
(the "Notice of Contest Period"), Seller may
send written notice (the "Notice of Contest")
to Purchaser that Seller disputes the claims
made by Purchaser in the Claim Notice. For a
period of thirty (30) clays (the "Resolution
Period") from receipt by Purchaser of a Notice
of Contest by Seller, Purchaser and Seller
shall attempt to negotiate in good faith a
written resolution of the dispute. If, at the
conclusion of the Resolution Period, the
parties have been unable to negotiate such a
resolution, each party shall set forth a
detailed written statement of such party's
position (the "Arbitration Submission") with
respect to such dispute including a statement
of those amounts in dispute which such party
believes to constitute Purchaser Claims and the
statements thus prepared shall be submitted to
arbitration by the American Arbitration
Association sited in San Luis Obispo,
California. In such case, the arbitrator, in
its decision, shall determine which party is
the prevailing party, and the non-prevailing
party, upon such decision, shall immediately
reimburse the prevailing party for all costs,
expenses and fees (including attorneys' fees)
incurred by the prevailing party in connection
with such arbitration.
(c) For purposes hereof, the Setoff Amount
shall be determined as follows:
(i) In the event that
Seller does not send a Notice
of Contest within the Notice
of Consent Period, then the
Setoff Amount shall be that
amount claimed by Purchaser
as Purchaser Claims in the
Claim Notice;
(ii) In the event that
Seller does send a Notice of
Contest and the dispute is
subsequently resolved by
negotiation, then the Setoff
Amount shall be that amount
upon which the parties agree
in writing;
(iii) In the event that
Seller does send a Notice of
Contest and the dispute is
subsequently resolved by
resort to arbitration as
provided herein, then the
Setoff Amount shall be that
amount set forth in the
arbitrator's decision as
constituting Purchaser Claims.
11.6 Escrow on Maturity of Long Term Note. In the
event that, at such time as all principal and interest
becomes due and payable under the terms of the Long Term
Note, Purchaser has submitted one or more Purchaser
Claims with respect to which the Setoff Amount has not
yet been determined or has been determined but is not
yet paid, then Purchaser shall withhold from its payment
to Seller of all such principal and interest an amount
(the "Withheld Amount") equal to the aggregate Purchaser
Claims claimed by Purchaser. Purchaser shall immediately
deposit the Withheld Amount with Fleet National Bank to
earn interest and from which distributions of the
Withheld Amount shall be made in accordance with the
terms of the resolution of the Purchaser Claims. All
amounts due under the Long Term Note in excess of the
Withheld Amount shall be paid immediately to Seller.
SECTION 12. SURVIVAL OF REPRESENTATIONS AND
WARRANTIES AND INDEMNIFICATION
The representations, warranties and covenants set forth
in this Agreement or in any Exhibit, Schedule,
certificate or other document or instrument delivered
pursuant to this Agreement, and the indemnification
provisions contained in this Agreement, shall survive
the Closing. The conduct by the Purchaser of due
diligence or other investigations of the Americom
Products Business, whether before or after the Closing,
and the information learned as a result of such
investigations, shall not in any way constitute a waiver
by Purchaser of the representations, warranties,
covenants and indemnification obligations of Seller set
forth in this Agreement or otherwise limit Purchaser's
ability to enforce any of the same.
SECTION 13. MISCELLANEOUS
13.1 Access to Books and Records; Cooperation in
Litigation. After the Closing, each party shall furnish
to the other party such reports as are required for the
requesting party to discharge its obligations. Each
party shall also permit the other party to have
reasonable access to the books, records and files
relating to the Americom Products Business for any
reasonable purpose of the other party, such as for use
in litigation or in tax compliance matters. Each party
shall also reasonably cooperate with the other party in
the requesting party's prosecution or defense of any
litigation or other proceeding arising from the
requesting party's utilization of the Technology.
13.2 Binding Effect; Assignment. This Agreement shall
be binding upon, inure to the benefit of, and be
enforceable by the successors and permitted assigns of
the parties hereto. In this regard, Purchaser shall be
free to assign its rights under this Agreement to any
other party.
13.3 Notices. All notices or other communications
required or permitted to be given hereunder shall become
effective when delivered by hand or received by telegram
or registered first-class mail, postage prepaid and
addressed to the intended recipient at the address
indicated below. Any party may at any time and from time
to time change its address by a notice given to the
other party in the manner set forth in this Section.
(a) If to Seller:
Americom Ltd.
c/o Twa, Cochrane, Scatfeld & Associates Chancery Court,
P.O. Box 209
Providenciales, Turks & Caicos Islands, BWI
Attention: Bruce R. Twa,
Telephone: 649-946-4261 Fax: 649-946-4410
e-mail- [email protected]
(b) If to Purchaser:
Americom U.S.A., Inc.
Schwarz Gillen, 2040 Yonge Street
Suite 220, Toronto, Ontario M4S 1Z9
Telephone: 416-486-2040 Fax: 416-486-3325
e-mail [email protected]
13.4 Waivers. No action taken pursuant to this
Agreement, including any investigation by or on behalf
of any party hereto, shall be deemed to constitute a
waiver by the party taking such action, of compliance
with any representation, warranty, covenant or agreement
contained herein. The waiver by any party hereto of any
condition or of a breach of any provision of this
Agreement shall not operate or be construed as a waiver
of any other condition or other breach. The waiver by
any party of any of the conditions precedent to its
obligations under this Agreement shall not preclude it
from seeking redress for breach of this Agreement other
than with respect to the condition so waived.
13.5 Counterparts. This Agreement may be executed
simultaneously in two or more counterparts, each of
which shall be deemed an original, but all of which
together shall constitute and be the same instrument.
This Agreement shall become effective when at least one
counterpart has been executed by each party hereto
notwithstanding the fact that not all of the parties
hereto have executed the same copy of the Agreement.
This Agreement may be delivered by any party hereto by
facsimile transmission of the signature page of this
Agreement executed on behalf of such party. The
foregoing provisions shall apply to each of the
instruments and agreements to be executed and delivered
by the parties at the Closing.
13.6 Exhibits and Schedules. The following Exhibits and
Schedules are attached hereto and are hereby
incorporated herein and made a part hereof:
EXHIBIT DESCRIPTION
1.4(A) BILL OF SALE
1.4(B) ASSIGNMENT OF CONTRACTS
1.4(C) ASSIGNMENT OF TRADEMARKS
1.4(D) LICENSE
2.2 WIRE TRANSFER INSTRUCTIONS
2.3 PROMISSORY NOTE
3.1 ASSUMPTION DOCUMENT
6.1 NON-COMPETITION AGREEMENT
13.7 Bulk Transfers. The parties hereto waive
compliance with the requirements of the bulk sales law
of any jurisdiction in connection with the sale of the
Technology to Purchaser hereunder. Seller shall
indemnify and hold harmless Purchaser against all losses
which may be incurred by Purchaser as a result of
noncompliance with any such Bulk Sales Laws.
13.8 Governing Law. The validity, performance and
enforcement of this Agreement, shall be governed by the
laws of California without giving effect to the
principles of conflicts of law thereof.
13.9 Separability. Any term or provision of this
Agreement which is invalid or unenforceable shall be
ineffective to the extent of such invalidity or
unenforceability without rendering invalid or
unenforceable the remaining terms and provisions of this
Agreement.
13.10 Headings. The headings and subheadings hereof
are inserted for convenience of reference only and shall
not affect the interpretation of this Agreement.
13.11 Attorneys' Fees. The Seller shall
pay the cost of any and all legal fees
incurred by both Seller and Purchaser in
connection with this transaction. In the
event any dispute or controversy arises
with respect to this Agreement, the
prevailing party shall be entitled to
recover its actual costs and attorneys fees
from the other party, whether such dispute
or controversy is resolved by arbitral,
judicial or administrative order,
settlement or appeal.
13.12 Amendment. This Agreement may be amended only in
writing, signed by both parties hereto.
13.13 Entire Agreement. This Agreement, including the
Exhibits and Schedules attached hereto, merges all prior
negotiations between the parties and embodies the entire
agreement of the parties with respect to the subject
matter hereof and no party hereto shall be bound by any
condition, definition, warranty or representation other
than expressly provided for in this Agreement (including
the Exhibits and Schedules attached hereto) as the same
shall apply to such party.
13.14 No Rights of Third Parties. The parties hereto
specifically intend and agree that nothing contained
herein shall be construed as in any way granting or
otherwise according any rights to any person or entity
not a party to this Agreement.
IN WITNESS WHEREOF, the parties hereto have duly
executed this Agreement, under seal, by their duly
authorized officers as of the date first set forth above.
AMERICOM LTD.
By:
Name:
Title:
AMERICOM USA, INC.
By:
Name:
Title:
EXHIBIT 1.4(A)
BILL OF SALE
This Bill of Sale is made by AMERICOM LTD., a Turks and
Caicos corporation (hereinafter referred to as
"Seller"), in favor of AMERICOM U.S.A., INC., a Delaware
corporation (hereinafter referred to as "Purchaser").
This Bill of Sale is given pursuant to the terms and
conditions of that certain Agreement of Purchase and
Sale (the "Agreement"), dated effective March 11,1999,
by and between Seller and Purchaser relating to the sale
of all assets of Seller used in Seller's Americom
Products Business (as such term is defined in the
Agreement).
For good and valuable consideration to it paid, receipt
of which is hereby acknowledged, Seller by these
presents does sell, assign, transfer, and convey unto
Purchaser, its successors and assigns, the following
described property (the "Assets"):
(i) All source
code and object code
comprising any part of or
in any way used in any
software applications or
modules (collectively,
the "Americom Software")
forming the basis of or
otherwise used in
connection with the
Americom Products (as
defined in the Agreement)
together with all tapes,
disks, printouts and
other media on which the
Americom Software is
stored (the "Principal
Technology"). The
Principal Technology
conveyed herewith
includes, without
limitation, the software
printout delivered with
the Agreement by Seller,
which has been jointly
identified by Seller and
Purchaser, a copy of
which is being retained
at the offices of
Purchaser's counsel;
(ii) To the
extent reduced to written
or other tangible form
(including but not
limited to electronic
media), ail drawings,
designs, plans, manuals,
research, specifications,
formulae, processes,
know-how, technology,
trade secrets and other
confidential or
proprietary information
and other data and
information pertaining in
any way to the Americom
Products or the Americom
Software or contemplated
improvements,
supplements, additions to
the Americom Products or
the Americom Software;
(iii) All customer
lists and customer files
directly related to the
Americom Products;
(iv) All
marketing surveys, sales
records, sales
projections, marketing
plans and other materials
related to the marketing
of the Americom Products;
(v) All of
Seller's rights under any
licensing, marketing,
sales or other
arrangements
(collectively,
"Contracts") pertaining
to the Americom Products
Business, together with
all of Seller's rights to
revenues to which the
Seller otherwise would
become entitled from and
after the date of this
Agreement; provided that
Purchaser shall have
sixty (60) days to review
and consider the
Contracts, and to elect,
at its option, to reject
the assignment of any one
or more of the Contracts;
(vi) Those
trademarks, service marks
and trade names, together
with all U.S. and foreign
applications for
registration rights
therefor, which are used
by Seller in the
marketing, distribution,
licensing and sale of the
Americom Products (the
"Trademarks");
(vii) To the
extent reduced to written
or other tangible form
(including but not
limited to electronic
media), all drawings,
designs, plans, manuals,
research, specifications,
formulae, processes,
know-how, technology,
trade secrets and other
confidential or
proprietary information
and other data and
information (to the
extent not otherwise
encompassed in paragraphs
1.1 (a) through (c) above
pertaining in any way to
the Americom Products or
the Americom Software or
contemplated
improvements,
supplements, additions to
the Americom Products or
the Americom Software
(collectively, the "Other
Intellectual Property
Interests");
(viii) All customer
lists and customer files
directly related to the
Americom Products (the
"Customer Files");
(ix) All
marketing surveys, sales
records, sales
projections, marketing
plans and other materials
related to the marketing
of the Americom Products
(the "Marketing Materials").
TO HAVE AND TO HOLD all the Assets
unto Purchaser and its successors and
assigns, to and for its and their use
forever.
Seller hereby authorizes and grants a
power of attorney to Purchaser and
appoints Purchaser and the officers,
members and managers thereof as
Seller's attorney-in-fact to take any
appropriate action in connection with
any of the Assets to vest full title
and possession thereto in Purchaser,
such action to be taken in the name of
Seller or in Purchaser's own or any
other name, it being understood that
this authorization and power of
attorney are coupled with an interest
and irrevocable.
Seller does hereby further warrant,
covenant, and agree that it has good
and marketable title to the Assets
against all and every person or
persons claiming or purporting to
claim against any or all of the same,
subject to the terms and provisions of
the Agreement.
IN WITNESS WHEREOF, the parties hereto
have caused this Bill of Sale to be
duly executed as of the 30th day of
April, 1999.
Witness:
AMERICOM LTD., Seller
BY:
Name:
Title:
Witness:
AMERICOM U.S.A., INC., Purchaser
BY:
Name:
Title:
EXHIBIT 1.4(B)
ASSIGNMENT OF CONTRACTS
This Assignment of Contracts (this
"Assignment") is made by AMERICOM
LTD., a Turks and Caicos corporation
("Seller"), in favor of AMERICOM
U.S.A., INC., a Delaware corporation
("Purchaser"). This Assignment is
given pursuant to Section 1.4(b) of
that certain Agreement of Purchase and
Sale (the "Agreement"), dated
effective March 11, 1999, by and
between Seller and Purchaser relating
to the sale of all assets of Seller
used in Seller's Americom Products
Business (as such term is defined in
the Agreement).
For good and valuable consideration to
it paid, receipt of which is hereby
acknowledged, Seller by these presents
does sell, assign, transfer, and
convey unto Purchaser, its successors
and assigns, all of Seller's rights
pursuant to any licensing, marketing,
sales or other arrangements
(collectively, "Contracts") pertaining
to the Americom Products Business,
together with all of Seller's rights
to revenues to which Seller otherwise
would become entitled from and after
the date of this Agreement; provided
that Purchaser shall have sixty (60)
days to review and consider the
Contracts, and to elect, at its
option, to reject the assignment of
any one or more of the Contracts.
Seller hereby authorizes and grants a
power of attorney to Purchaser and
appoints Purchaser and the officers,
managers and members thereof as
Seller's attorney-in-fact to take any
appropriate action in connection with
any of the Contracts such that the
full benefits of such Contracts shall
vest in Purchaser (subject to
Purchaser's right to reject the
assignment of any contract as set
forth above), such action to be taken
in the name of Seller or in
Purchaser's own or any other name, it
being understood that this
authorization and power of attorney
are coupled with an interest and
irrevocable.
Seller does hereby further warrant,
covenant, and agree that (i) no third
party has acquired any interest in or
any lien upon the rights of Seller
under the Contracts and (ii) the
assignment of the Contracts from
Seller to Purchaser does not require
the consent or approval of any other
party.
Seller further agrees that this
Assignment of Contracts constitutes an
assignment of Seller's rights under
the Contracts and does not in any way
constitute an assumption by Purchaser
of any of Seller's liabilities and
obligations.
IN WITNESS WHEREOF, the parties hereto
have caused this Assignment of
Contracts to be duly executed as of
the 30th day of April, 1999.
Witness: AMERICOM LTD.
Per:
Name and Title:
Witness: AMERICOM U.S.A., INC.
Per:
Name and Title:
EXHIBIT 1.4(C)
ASSIGNMENT OF TRADEMARKS
WHEREAS, AMERICOM, LTD., a Turks and Caicos
corporation (hereinafter referred to as the
"Seller"), currently uses and claims
ownership of all rights in certain United
States and foreign trademarks and service
marks as well as any and all trademark
registrations and applications for
trademark registrations associated with
such trademarks and service marks
(collectively, the "Trademarks and
Applications") used by Seller in the
conduct by Seller of the Americom Products
Business (as defined below); and
WHEREAS, pursuant to a certain Agreement of Purchase
and Sale and Exclusive Licensing of Technology dated
effective as of the 11th day of March, 1999 (the
"Agreement"), Seller has agreed to assign to AMERICOM
U.S.A., INC., a Delaware corporation (hereinafter
referred to as the "Purchaser") substantially all
assets used by Seller in the conduct of its Americom
Products Business (as defined in the Agreement),
including the Trademarks and Applications.
NOW, THEREFORE, for good and valuable
consideration, the receipt of which is
hereby acknowledged, said Seller has sold,
assigned, transferred, and set over, and by
these presents, does hereby sell, assign,
transfer, and set over unto the said
Purchaser, as to all of such Trademarks and
Applications, for its own use and benefit,
and for the use and benefit of its
successors, legal representatives, and
assigns the entire right, title, and
interest in and to the Trademarks and
Applications, all existing United States
and foreign registrations of the Trademarks
and Applications, together with the
goodwill of the business symbolized by the
Trademarks and Applications.
Regarding the Trademarks and Applications, said
properties are to be held and enjoyed by said Purchaser
together with all renewals and continuations thereof;
together with the right to file such applications and
the right to claim for the same priority rights derived
from any previously filed applications under the
trademark laws of the United States of America or other
countries; and together with all claims for damages by
reason of past infringement of any such Trademarks,
with the right to sue for and collect the same in a
court of competent jurisdiction-
AND SELLER HEREBY authorizes and requests the
Commissioner of Patents and Trademarks of the United
States, and any official of any country or countries
foreign to the United States, whose duty it is to
register trademarks or other evidence or forms of
intellectual property protection on applications as
aforesaid, to issue the same to the said Purchaser in
accordance with the terms of this instrument;
AND SELLER HEREBY further covenants and agrees
that it will do everything reasonably possible to aid
the said Purchaser, its successors, legal
representatives, and assigns, to secure registration of
said Trademarks and Applications in all countries and
in the implementation and perfection of this assignment.
AND SELLER FURTHER WARRANTS THAT it is the true and
lawful owner, free and clear of all liens,
encumbrances, or claims of third parties, of all such
Trademarks and Applications, that none of such
Trademarks and Applications infringes upon the
trademarks or service marks of any other person, nor is
there any claim of such infringement, that it has not
licensed or in any way granted to any third parties any
rights therein, and that its directors, officers, or
authorized agents will execute all assignments for
recordation of the conveyances recited as being
appropriate in various countries herein.
IN TESTIMONY WHEREOF, the undersigned have caused this
assignment to be signed and executed by the undersigned
officers thereunto duly authorized this 30th day of
April, 1999.
AMERICOM LTD. AMERICOM U.S.A., INC.
By: By:
Name: Name:
Title: Title:
EXHIBIT 1.4(D)
LICENSE AGREEMENT
This LICENSE AGREEMENT (this "Agreement") is entered
into as of the 30th day of April, 1999, by and
between AMERICOM LTD., a Turks and Caicos corporation
(hereinafter "Seller"), and AMERICOM U.S.A., INC., a
Delaware corporation (hereinafter "Purchaser").
WHEREAS, pursuant to that certain Agreement of Purchase
and Sale and Exclusive Licensing of Technology dated
effective March 11, 1999 between Seller and Purchaser
(the "Acquisition Agreement"), Purchaser is acquiring
from Seller, all right, title and interest of Seller in
and to certain Technology (as defined in the
Acquisition Agreement) related to Seller's Americom
Products Business (as defined in the Acquisition
Agreement); and
WHEREAS, pursuant to section 1.4(d) of the Acquisition
Agreement, Seller and Purchaser have agreed to enter
into this Agreement, it being the intent of the parties
that, in the event that the Acquisition Agreement
shall, for any reason, be insufficient to convey all
right, title and interest in and to all of the
Technology from Seller to Purchaser, Purchaser shall
have an exclusive, perpetual and non-royalty bearing
license with respect to such Technology,
NOW, THEREFORE, in consideration of the foregoing
premises and the mutual covenants contained herein, the
parties hereby agree as follows:
SECTION 1. GRANT OF LICENSE.
Seller hereby grants to Purchaser an exclusive,
paid-up, world-wide and non-royalty bearing license,
with full power to assign and sublicense, with respect
to any and all of the Technology (as defined in the
Acquisition Agreement).
SECTION 2. NO RETAINED RIGHTS OF SELLER.
The rights of Purchaser hereunder shall be exclusive
such that no other party, including Seller, shall have
any right, power, authority or privilege to use the
Technology for any purpose whatsoever.
SECTION 3. MISCELLANEOUS PROVISIONS.
(a) Successors. This Agreement shall be binding
upon and inure to the benefit of the successors and
assigns of the respective parties hereto.
(b) Descriptive Headings. The headings of the
Sections of this Agreement are inserted for convenience
only, shall not be deemed to be a part of this
Agreement, and in no way define, limit, extend or
describe the scope or intent of this Agreement or of
any provision hereof.
(c) Counterparts. This Agreement may be executed in
several counterparts, each of which shall be deemed to
be an original and all of which shall constitute one
(1) Agreement, binding on all the parties hereto,
notwithstanding that all the parties have not signed
the same counterpart.
(d) Modifications and Amendments. No amendment,
change or modification of this Agreement shall be valid
unless in writing and signed by all the parties hereto.
(e) Further Assurances. Each of the parties hereto
shall execute and deliver any and all additional
papers, documents and other assurances and shall do any
and all acts or things reasonably necessary in
connection with the performance of their obligations
hereunder to carry out the express intent of the
parties hereto.
(f) Waiver. No waiver of any provision of this
Agreement or the rights or obligations of any party
hereunder, shall be effective, except pursuant to a
written instrument signed by the party or parties
waiving compliance, and any such waiver shall be
effective only in the specific instance and for the
specific purpose stated in such writing.
(g) Attorneys' Fees. In the event any dispute or
controversy arises with respect to this Agreement, the
prevailing party shall be entitled to recover its
actual costs and attorneys fees from the other party,
whether such dispute or controversy is resolved by
judicial or administrative order, settlement or appeal.
(h) Enforceability of Provisions. If any provision
of this Agreement shall be held by a court of competent
jurisdiction to be illegal, invalid or unenforceable,
the validity, legality and enforceability of the
remaining provisions of this Agreement shall not in any
way be affected or impaired by such holding.
(i) Governing Law. This Agreement shall be governed
by and construed in accordance with the laws of the
State of California.
IN WITNESS WHEREOF, the parties hereto have duly
executed this Agreement as of the day and year first
above written.
AMERICOM LTD.
By:
Name:
Title:
AMERICOM U.S.A., INC.
By:
Name:
Title:
EXHIBIT 2.2
WIRE INSTRUCTIONS
CREDIT ACCOUNT: Twa, Cochrane Skatfeld & Associates
Attorneys at Law
Chancery Court, PO Box 209
Providenciales, Turks & Caicos Islands
B.W.I.
BANK: Barklays Bank PLC
Providenciales, Turks & Caicos Islands
B.W.I.
ACCOUNT NO.: Client's Account 168 3915
REFERENCE: Americom USA, Inc. p/f
Americom Ltd. Trust Deposit Account
EXHIBIT 2.3
PROMISSORY NOTE
$400,000.00April 30, 1999
FOR VALUE RECEIVED, AMERICOM U.S.A., INC., a
Delaware corporation, promises to pay to the
order of Americom Ltd., a Turks and Caicos
corporation (hereinafter, "Lender"), in
immediately available funds and in lawful
currency of the United States of America, the
principal sum of FOUR HUNDRED THOUSAND DOLLARS
($400,000.00), together with interest at the
rate of Eight (8%) per cent per annum
compounded semi-annually not in advance.
The principal and interest outstanding under this Note
shall be repaid as follows:
(x) A lump sum payment of TWO
HUNDRED THOUSAND DOLLARS ($200,000.00)
is due and payable on the first
anniversary date of the Promissory
Note; and
(xi) A second lump sum payment of
TWO HUNDRED THOUSAND DOLLARS
($200,000.00) plus any and all accrued
and unpaid interest owing under the
note is due and payable on the second
anniversary date of the (Promissory
Note).
The undersigned expressly agrees that no renewal or
extension granted, whether by acceptance of interest in
advance or otherwise, nor any indulgence shown to, nor
any release of, nor any dealings between a holder
hereof and any person now or hereafter interested
herein or in any of the security for this Note, whether
as owner, encumbrancer, guarantor or otherwise, shall
discharge, extend or in any way affect the obligations
of the undersigned as principal debtor hereunder.
The undersigned may prepay all or any portion of the
principal balance of this Note at any time and from
time to time without payment of any penalty, fee or
premium.
Upon the occurrence of any one or more of the following
events of default:
1. failure of the undersigned to make any payment
when due hereunder; or
2. insolvency, or the appointment of a permanent
receiver for or for any of the property of, or an
assignment for the benefit of creditors, or the filing
of either a petition under any federal or state
bankruptcy, receivership, insolvency or debtor relief
law or of a petition for any readjustment of
indebtedness, composition or extension by (or the
pendency of an involuntary petition undismissed for a
period of thirty (30) days against), the undersigned;
this Note shall, in any such event, at the option of
the holder, become immediately due and payable without
presentment, demand, protest or notice of any kind, all
of which are hereby expressly waived by the undersigned
and each and every person now or hereafter liable,
absolutely or contingently, for the payment of the
whole or any part of this Note.
Whenever possible, each provision of this Note shall be
interpreted in such manner as to be effective and valid
under applicable law. If any portion of this Note is
declared invalid for any reason in any jurisdiction,
then such declaration shall have no effect upon the
remaining portions of this Note. In addition, the
entirety of this Note shall continue in full force and
effect in other jurisdictions and said remaining
portions of this Note shall continue in full force and
effect in the subject jurisdiction as if this Note had
been executed with the invalid portions thereof deleted.
The terms hereof shall be binding on the successors and
assigns of the undersigned, whether by operation of law
or otherwise. This Note shall be deemed to have been
executed and delivered in the State of California and
shall be in all respects governed, construed, applied
and enforced in accordance with the laws of said State
of California without resort to its conflict of laws
rules.
Except as otherwise specified herein or by notice, all
notices and communications provided for herein shall be
in writing and shall be deemed effective when deposited
in the United States mail, sent by certified mail,
return receipt requested, postage prepaid, addressed as
follows:
(a) If to the undersigned, to:
AMERICOM U.S.A., INC.
Schwarz Gillen
2040 Yonge Street,
Ste 220
Toronto, Ontario M4S 1Z9
Telephone: 416-486-2040 Fax: 416-486-3325
e-mail [email protected]
(b) Americom Ltd.
If to Lender, to:
Cochrane, Scatfeld & Associates
Chancery Court,
P.O. Box 209
Provenciales, Turks & Caicos Islands, BWI
Attention: Bruce R. Twa,
Telephone: 649-946-4261
Fax: 649-946-4410
e-mail- [email protected]
Any party may change its address by not less than five
(5) days' advance notice thereof given to the other
party as the aforesaid.
IN THE EVENT THAT EITHER LENDER OR THE UNDERSIGNED
BRINGS ANY ACTION OR PROCEEDING IN CONNECTION HEREWITH
OR IN CONNECTION WITH THIS NOTE, LENDER AND THE
UNDERSIGNED AGREE THAT ANY SUCH ACTION OR PROCEEDING
SHALL BE BROUGHT EXCLUSIVELY IN ANY COURT OF RECORD OF
THE STATE OF CALIFORNIA. EACH OF THE LENDER AND THE
UNDERSIGNED HEREBY IRREVOCABLY CONSENTS TO AND CONFERS
PERSONAL JURISDICTION OF ANY SUCH COURT OVER SUCH
PARTY BY SUCH COURT. IN ANY SUCH ACTION OR PROCEEDING,
THE EACH OF THE LENDER AND THE UNDERSIGNED IIEREBY
WAIVES PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR
OTHER PROCESS AND AGREES THAT SERVICE THEREOF MAY BE
MADE UPON SUCH PARTY BY MAILING A COPY OF SUCH
SUMMONS, COMPLAINT OR OTHER PROCESS BY CERTIFIED MAIL,
RETURN RECEIPT
REQUESTED, POSTAGE PREPAID, TO SUCH PARTY AT THE
ADDRESS SET FORTH HEREIN.
IN WITNESS WHEREOF, the undersigned has executed this
Note, by its duly authorized officer, as of the day
and date first above written.
Witnessed by:
AMERICOM U.S.A., INC.
By:
Name:
Title:
EXHIBIT 3.1
ASSUMPTION OF OBLIGATIONS
This Assumption of Obligations
(this "Assumption") is made by
AMERICOM U.S.A., INC., a Delaware
corporation ("Purchaser"), in favor
of AMERICOM LTD., a Turks and
Caicos corporation ("Seller"). This
Assumption is made pursuant to
Section 3.1of that certain
Agreement of Purchase and Sale (the
"Agreement"), dated effective March
11, 1999, by and between Seller and
Purchaser relating to the sale of
all Technology related to Seller's
Americom Products Business (as
defined in the Agreement). Except
as otherwise set forth herein,
defined terms used herein shall
have such meaning as given to such
terms in the Agreement.
1. Pursuant to the Agreement the Seller
has assigned to the Purchaser all of its
rights under certain contracts (the
"Contracts") pertaining to the Americom
Products Business, subject, however to
Purchaser's right to reject the assignment of
any particular contract within sixty (60)
days of the Closing Date (the "Rejection
Period"). In consideration thereof, Purchaser
by these presents does hereby assume and
agrees to pay, perform, or discharge those
obligations of Seller under the Contracts to
the extent that (i) such obligations by their
terms are to be performed after the Closing
Date, and (ii) Purchaser has not rejected the
assignment of any such Contract during the
Rejection Period.
2. Seller shall retain full and sole
responsibility for all obligations and
liabilities with respect to the development,
marketing, distribution, licensing and sale
of the Americom Products except for those
liabilities specifically assumed in paragraph
1 above, including without limitation:
(a) any
liability in
respect of or
arising out of
any of the
Americom Products
which were
licensed or sold
prior to Closing;
(b) any
liability for
failure of the
Americom Products
to perform
according to
specification or
as intended prior
to the Closing Date;
(c) any
liability or
obligations
involving the
payment of any
taxes arising out
of or relating to
the operation of
the Americom
Products Business
by the Seller
prior to the
Closing;
(d) any
liability or
responsibility
with respect to
claims for credit
by third parties
with respect to
Products licensed
or sold prior to
the Closing; and
(e) any
liability or
obligation to any
third parties not
expressly assumed
in the Assumption
Document.
IN WITNESS WHEREOF, the parties hereto have caused
this Assumption of Obligations to be duly executed as
of the 30th day of April, 1999.
AMERICOM LTD. AMERICOM U.S.A., INC.
Per: Per:
Name: Name:
Title: Title:
EXHIBIT 6.1
NON-COMPETITION AGREEMENT
This Non-Competition Agreement (this "Agreement"),
dated April 30th , 1999, is made by and among AMERICOM
U.S.A. INC., a Delaware corporation ("Purchaser") and
AMERICOM LTD., a Turks and Caicos corporation ("Seller").
WITNESSETH
WHEREAS, Purchaser and Seller have entered into that
certain Agreement of Purchase and Sale and Exclusive
Licensing of Technology (the Acquisition Agreement")
dated effective as of March 11, 1999; and
WHEREAS, Section 6.1 of the Acquisition Agreement
contemplates that Purchaser and Seller will enter into
a non-competition agreement on the terms and
conditions contained herein,
NOW THEREFORE, in consideration of the premises and
the mutual covenants herein contained, the receipt and
adequacy of which is hereby acknowledged, the parties
hereto hereby agree as follows:
SECTION 1. Covenant Not to Compete.
1.1 Seller hereby agrees not to engage directly or
indirectly (either alone or in association with any
other person, firm, corporation or any other business
organization) in any business conducted by Purchaser
during the term hereof including, but not limited to,
the business of marketing, distributing selling or
licensing enhanced communications services. The scope
of this covenant shall apply throughout the world.
1.2 Seller further agrees (i) not to call upon,
solicit, advise or otherwise do, or attempt to do,
business with any customers or accounts of Purchaser;
(ii) not to take away or interfere or attempt to
interfere with any custom, trade, business or
patronage of Purchaser; (iii) not to interfere or
attempt to interfere with any employees,
representatives or agents of Purchaser or induce or
attempt to induce any of them to leave the employ of
Purchaser; (iv) not to divulge any confidential
information or make available to any other person or
entity, any documents, files or other papers
concerning the business of Purchaser, specifically
including all information contained in the Technology
acquired by Purchaser from Seller pursuant to the
Acquisition Agreement; and (v) not to commit any act,
or in any way assist, others to commit any act, which
will injure Purchaser or Purchaser's conduct of the
Americom Products Business acquired from Seller.
1.3 The period of time during which Seller and Key
Employee are prohibited from engaging in the
activities enumerated in Section 1.1 and Section 1.2
hereof shall commence on the date hereof and end on
the fifth (5th) anniversary of the date hereof, except
that this period shall be extended by the length of
time during which Seller is in breach of any
provisions of this Agreement.
1.4 Seller and Purchaser intend that the covenants
of Section 1.1 and Section 1.2 hereof shall be deemed
to be a series of separate covenants, one for each and
every country, state or jurisdiction in the world, and
one for each month of the period specified in Section
1.3 hereof. If, in any judicial proceeding, a court
shall refuse to enforce any of such separate
covenants, then such unenforceable covenants shall be
deemed eliminated from the provisions hereof for the
purpose of such proceedings to the extent necessary to
permit the remaining separate covenants to be enforced
in such proceedings. If, in any judicial proceeding, a
court shall refuse to enforce any one or more of such
separate covenants because the total time thereof is
deemed to be excessive or unreasonable, then it is the
intent of Seller and Purchaser that such covenants,
which would otherwise be unenforceable due to such
excessive or unreasonable period of time, be enforced
for such lesser period of time as shall be deemed
reasonable and not excessive by such court.
1.5 Seller hereby acknowledges that any action by
Seller prohibited under Section 1.1 and/or Section 1.2
hereof would cause Purchaser irreparable injury and
damage for which monetary damages are inadequate.
Accordingly, in the event of a breach or a threatened
breach of Section 1.1 and/or Section 1.2 hereof,
Purchaser shall be entitled to seek an injunction
restraining such breach. Nothing contained herein
shall be construed as prohibiting Purchaser from
pursuing any other remedy available to Purchaser for
such breach or such threatened breach.
1.6 Seller has carefully read and considered the
provisions of this Section 1 and, having done so,
agrees that the agreements and restrictions set forth
in this Section 1, including but not limited to the
time period of restriction and geographical area of
restriction, are bargained for, are fair and
reasonable restrictions on Seller, and are reasonably
required for the protection of the interests of
Purchaser.
SECTION 2. No Rights Created in Third Parties.
2.1 Nothing contained herein shall be deemed a
covenant by Purchaser to retain on any terms or
conditions whatsoever the services of any person who
is an officer, employee, or agent of Seller or any
business operated by Seller on the date hereof, nor
shall anything contained herein be deemed to create
any rights whatsoever in any person to be engaged as
an officer, employee, agent or independent contractor
of Purchaser.
SECTION 3. Notices.
3.1 All demands, notices and communications
hereunder shall be in writing and shall be given by
hand delivery, United States mail (certified, return
receipt requested), overnight courier service or other
means, in each case with all postage or delivery
charges prepaid, to the party entitled thereto at such
party's address set forth below:
(a) If to Purchaser, to:
AMERICOM U.S.A., INC.
c/o Schwarz Gillen
2040 Yonge Street, Suite 220
Toronto, Ontario M4S 1Z9
Telephone: 416-486-2040 Fax: 416-486-3325
e-mail [email protected]
(b) If to Seller, to:
Americom Ltd.
c/o Twa, Cochrane, Scatfeld & Associates Chancery
Court, P.O. Box 209
Provenciales, Turks & Caicos Islands, BWI
Attention: Bruce R. Twa,
Telephone: 649-946-4261 Fax: 649-946-4410
e-mail- [email protected]
or at such other address as such party may hereafter
furnish to the other party by notice conforming to the
requirements of this Section. Any demand, notice or
communication hereunder shall be deemed to have been given
upon delivery to the appropriate address if delivered
other than by mail and, if delivered by mail, upon
depositing the same in the United States mail as above
stated (as evidenced by the date noted on the return
receipt).
SECTION 4. Separability Clause.
4.1 Any provision of this Agreement that conflicts
with applicable law or is held to be void or unenforceable
shall be ineffective to the extent of such conflict,
voidness or unenforceability without invalidating the
remaining provisions hereof, which remaining provisions
shall be enforceable to the fullest extent permitted under
applicable law.
SECTION 5. Governing Laws.
5.1 This Agreement shall be construed and the
obligations, rights and remedies of the parties hereunder
shall be determined in accordance with the laws of the
State of California, without reference to the. principles
of conflict of laws thereof.
SECTION 6. Successors and Assigns; Assignment of
Agreement.
6.1 This Agreement shall bind and inure to the benefit
of and be enforceable by the parties hereto and their
respective successors and assigns.
SECTION 7. Waiver.
7.1 The failure of any party to insist upon strict
performance of any covenant or obligation hereunder,
irrespective of the length of time for which such failure
continues, shall not be deemed a waiver of such party's
right to demand strict performance of such covenant or
obligation at a later time. No consent to or waiver of any
breach or default in the performance of any covenant or
obligation hereunder, whether express or implied, shall
constitute a consent to or waiver of any other breach or
default in the performance of the same or any other
covenant or obligation hereunder. No term or provision of
this Agreement shall be deemed waived unless such waiver
is in writing and signed by the party against whom such
waiver is sought to be enforced.
SECTION 8. Entire Agreement; Amendment.
8.1 This Agreement constitutes the entire agreement
and supersedes all other prior agreements and
understandings, both written and oral, among the parties
hereto with respect to the transactions contemplated
hereby and the subject matter hereof. No provision of this
Agreement may be modified, altered or amended except in a
writing executed by all parties hereto.
SECTION 9. Captions.
9.1 The Section and other headings contained in this
Agreement are inserted only as a matter of convenience and
for reference, and in no way define, limit, extend or
describe the scope of this Agreement or the intent of any
provision hereof.
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement or caused this Agreement to be executed by their
respective officers thereunto duly authorized.
AMERICOM LTD.
PER:
Name:
Title:
AMERICOM U.S.A., INC.
PER:
Name:
Title:
