PURCHASE AND SALE AGREEMENT
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THIS PURCHASE AND SALE AGREEMENT is made this 26th day of August, 2000
(the "Date of this Agreement"), by and between VDC TELECOMMUNICATIONS, INC., a
Delaware corporation ("Seller"), and OMNETRIX INTERNATIONAL, INC., a Colorado
corporation ("Buyer").
R E C I T A L S :
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WHEREAS, Seller is engaged in the telecommunications business; and
WHEREAS, Seller DESIRES TO SELL AND ASSIGN TO buyer, and Buyer desires
to purchase and assume from Seller, on the terms and subject to the conditions
set forth in this Agreement, the Purchased Assets, as defined herein.
NOW, THEREFORE, in consideration of the recitals and of the mutual
covenants, conditions, warranties and agreements set forth herein and for other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Buyer and Seller hereby agree as follows:
ARTICLE I
DEFINITIONS
1.1 When used in this Agreement, the following terms shall have
the meanings specified:
"Affiliate" shall mean any Person controlling, controlled by or under
common control with Seller. "Control" (including, with correlative meanings, the
terms "controlling", "controlled by" and "under common control with") as applied
to any Person, means the possession, directly or indirectly, of the power to
direct or cause the direction of the management and policies of that Person,
whether through the ownership of voting securities, by contract or otherwise.
Control is presumed by the ownership (whether legal or beneficial) of over fifty
percent (50%) of the applicable Person.
"Agreement" shall mean this Purchase and Sale Agreement, together with
the Schedules and the Exhibits attached hereto, as the same shall be amended
from time to time in accordance with the terms hereof.
"Assumed Liabilities" is defined in Section 2.4.
"Bill of Sale" shall mean the instrument in the form of EXHIBIT "A"
attached hereto.
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"Buyer" shall mean OMNETRIX INTERNATIONAL, INC., a Colorado
corporation.
"Buyer's Certificate" shall mean the corporate certifications of Buyer
in the form of EXHIBIT "B" attached hereto.
"Closing" shall mean the conference to be held at 10:00 a.m.,
Greenwich, Connecticut, time on the Closing Date at the offices of VDC
Telecommunications, Inc. at 75 Holly Hill Lane, Greenwich, CT 06830, or at such
other location, at which the transactions contemplated by this Agreement shall
be consummated.
"Closing Date" shall mean (a) August 26, 2000; or (b) such other date
as Buyer and Seller may agree upon in writing. The Closing may not occur after
August 30, 2000, unless Buyer and Seller agree in writing to extend the Closing
Date beyond such date. The Closing shall be deemed effective as of the opening
of business on the Closing Date.
"Code" shall mean the Internal Revenue Code of 1986, as amended.
"Earnest Money" is defined in Section 2.2.
"Event of Loss" shall mean any loss, taking, condemnation, damage or
destruction of or to any of the Purchased Assets.
"Exhibits" shall mean those exhibits referred to in this Agreement
which have been delivered concurrently with the execution of this Agreement, and
which are hereby incorporated herein and made a part hereof.
"Lien" shall mean any lien or encumbrance directly affecting the
Purchased Assets.
"Person" shall mean any natural person, general or limited partnership,
corporation, firm, association or other legal entity.
"Purchased Assets" shall mean the right, title and interest of Seller
in and to the assets described on EXHIBIT "C" hereto and incorporated herein by
reference.
"Purchase Price" is defined in Section 2.2.
"Schedules" shall mean those schedules referred to in this Agreement
which have been delivered concurrently with the execution of this Agreement, and
which are hereby incorporated herein and made a part hereof.
"Seller" shall mean VDC TELECOMMUNICATIONS, INC., a Delaware
corporation.
"Seller's Certificate" shall mean the corporate certifications of
Seller in the form of EXHIBIT "D" attached hereto.
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1.2 Singular/Plural; Gender; Sections. Where the context so
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requires or permits, the use of the singular form includes the plural, and the
use of the plural form includes the singular, and the use of any gender includes
any and all genders. Except as specifically set forth herein, all Section
references are to Sections and articles of this Agreement.
ARTICLE II
PURCHASE AND SALE
2.1 Purchase and Sale. On the terms and subject to the conditions
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set forth in this Agreement, Seller shall, at the Closing on the Closing Date,
sell, assign, convey, transfer and deliver to Buyer, and Buyer shall purchase
and acquire from Seller, all of Seller's right, title and interest, legal and
equitable, as of the Closing Date, in and to the Purchased Assets. THE PURCHASED
ASSETS ARE BEING PURCHASED IN AN "AS IS", "WHERE IS" CONDITION. Except for the
express warranties set forth in aRTICLE iv, SELLER does not make, and hereby
disclaims, any and all other Express and/or implied warranties, including, but
not limited to, warranties of merchantability, fitness for a particular purpose,
noninfringement and title, and any warranties arising from a course of dealing,
usage, or trade practice. SELLER MAKES NO REPRESENTATIONS OF OWNERSHIP IN OR
TRANSFERABILITY OF SOFTWARE.
2.2 Purchase Price. The total purchase price for the Purchased
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Assets shall be TWO HUNDRED AND TWENTY FIVE THOUSAND AND NO/100 DOLLARS
($225,000.00) (the "Purchase Price"). The Purchase Price shall be paid as
follows:
(a) On the Date of this Agreement, Buyer shall deliver to
Seller a cashier's check in the amount of thirty-SIX Thousand EIGHT
hundred and seventy-five and no/100 Dollars ($36,875.00) (the "Second
Payment") as an earnest money deposit. Additionally, Seller shall
retain the FIFTEEN Thousand SIX HUNDRED AND TWENTY FIVE AND no/100
Dollars ($15,625.00) paid by Buyer to Seller in connection with the
execution of a Letter of Intent (the "First Payment") (the First
Payment and the Second Payment are collectively referred to as the
"Earnest Money"). If this Agreement is terminated (by either party or
for any reason whatsoever), then to compensate Seller for its work on
this Agreement and transaction and for the loss of a benefit of the
bargain (and not as a penalty) the Earnest Money, together with all
interest earned thereon, shall be kept by Seller without further
obligation or liability to Buyer. The parties agree, in this regard,
that the forfeit of the Earnest Money is reasonable and the damages
associated with failure to consummate the transaction represented by
this Agreement are difficult to estimate. The retention of the Earnest
Money shall not be deemed an election of remedies. Notwithstanding the
foregoing, if Seller is in default in the performance of its material
obligations under this Agreement or has materially breached its
representations and warranties hereunder and fails to cure said default
or breach within five (5) calendar days of written notice from Buyer
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and Buyer is not in default of its material obligations under this
Agreement and has not materially breached its representations and
warranties hereunder, then Seller shall keep the First Payment and
shall return the Second Payment to Buyer.
(b) The Purchase Price, less the Earnest Money shall be
paid to Seller in immediately available funds at Closing, as defined
herein, subject to compliance with the terms and conditions set forth
herein and fulfillment of all conditions precedent as specified
herein.
2.3 Closing Date Deliveries. At the Closing on the Closing Date:
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(a) Seller shall deliver, or cause to be delivered, to
Buyer, properly executed and dated as of the Closing Date all
documents required under Section 7.7 of this Agreement.
(b) Buyer shall deliver, or cause to be delivered, to
Seller, properly executed and dated as of the Closing Date all
documents required under Section 8.3 of this Agreement.
2.4 Assumption of Liabilities. As of the Closing, Buyer shall
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assume and become obligated to pay any debt, obligation or liability of any kind
or nature arising out of the Purchased Assets (the "Assumed Liabilities"). To
the best of Seller's knowledge, as of the Date of this Agreement, there are no
Liens on the Purchased Assets. Nothing in the foregoing sentence shall impose
upon Seller any duty of investigation or due diligence. Without limiting the
generality of the foregoing sentence, Seller shall have no duty to perform a UCC
lien search in any state or jurisdiction.
2.5 Taxes. All federal, state, local and other transfer, sales and
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use taxes applicable to, imposed upon or arising out of the transfer to Buyer of
the Purchased Assets as contemplated by this Agreement shall be paid by Buyer.
2.6 Risk of Loss. Subject to Section 10.1 hereof, the risk of all
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Events of Loss prior to the Closing shall be upon Seller and the risk of all
Events of Loss at or subsequent to the Closing shall be upon Buyer.
2.7 Allocation of Purchase Price. The Purchase Price will be
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allocated among the Purchased Assets in accordance with SCHEDULE 2.7. Buyer and
Seller each agree to report such allocation to the Internal Revenue Service in
the form required by Treasury Regulation 1.1060T.
ARTICLE III
GOVERNMENTAL APPROVALS
3.1 Governmental Approvals. Promptly following the execution of
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this Agreement, if executed prior to the Closing Date, Buyer shall proceed to
prepare and file with the appropriate governmental authorities any requests for
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approvals or waivers that are required from governmental authorities in
connection with the Closing, and shall diligently and expeditiously prosecute
such requests for approvals or waivers and all proceedings necessary to secure
such approvals and waivers.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF SELLER
Seller hereby represents and warrants to Buyer, which representations
and warranties shall survive the Closing in accordance with Section 10.4, as
follows:
4.1 Organization. Seller is a corporation duly organized and
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validly existing under the laws of the State of Delaware. Seller has the power
to own or lease its properties and to carry on its business in the place where
such properties are now owned, leased or operated and such business is now
conducted.
4.2 Authorization: Enforceability. The execution, delivery and
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performance of this Agreement and all of the documents and instruments required
hereby by Seller and the consummation by Seller of the transactions contemplated
hereby have been duly and validly authorized by the Board of Directors of
Seller, and no other proceedings on its part are necessary to authorize the
execution, delivery and performance of this Agreement. This Agreement is, and
the other documents and instruments required hereby will be, when executed and
delivered by Seller, the valid and binding obligations of Seller, enforceable
against Seller in accordance with their respective terms, subject only to
bankruptcy, insolvency, reorganization, moratoriums or similar laws at the time
in effect affecting the enforceability or rights of creditors generally and by
general equitable principles which may limit the right to obtain equitable
remedies.
4.3 Authority; No Breach. Seller has the requisite corporate power
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and authority to execute and deliver this Agreement and to perform its
obligations hereunder. The execution, delivery and performance of this Agreement
by Seller and the consummation of the transactions contemplated hereby do not
conflict with or result in any breach of any of the provisions of, or constitute
a default under, result in a violation of, result in the creation of a right of
termination or acceleration or any lien, security interest, charge or
authorization, consent, approval, exemption or other action by or notice to any
court or other governmental body, under the provisions of the Articles of
Incorporation or Bylaws of Seller or any indenture, mortgage, lease, loan
agreement or other agreement or instrument by which Seller or the Purchased
Assets are bound or affected, or any law, statute, rule or regulation or order,
judgment or decree to which Seller or the Purchased Assets are subject.
4.4 Governmental Authorities; Consents. The Seller is not required
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to submit any notice, report or other filing with any governmental authority in
connection with the execution or delivery by it of this Agreement or the
consummation of the transactions contemplated hereby. No consent, approval or
authorization of any governmental or regulatory authority is required to be
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obtained by Seller in connection with its execution, delivery and performance of
this Agreement.
4.5 Brokers. Neither this Agreement nor the sale and purchase of
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the Purchased Assets or any other transaction contemplated by this Agreement was
induced or procured through any Person acting on behalf of or representing
Seller as broker, finder, investment banker, financial advisor or in any similar
capacity.
4.6 Title to Purchased Assets. Seller owns good and marketable
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title in and to the Purchased Assets. SELLER MAKES NO REPRESENTATIONS REGARDING
THE OWNERSHIP OF OR TRANSFERABILITY OF ANY SOFTWARE CONTAINED OR USED WITH THE
SWITCH. THE SELLER HEREBY SELLS THE HARDWARE TO THE BUYER.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer represents and warrants to Seller which representations and
warranties shall survive the Closing in accordance with Section 10.4, as
follows:
5.1 Organization. Buyer is a corporation duly organized and
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validly existing under the laws of the State of Colorado, with the requisite
corporate power and authority to enter into this Agreement and perform its
obligations hereunder.
5.2 Execution, Delivery; Valid and Binding Agreement. The
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execution, delivery and performance of this Agreement by Buyer and the
consummation by Buyer of the transactions contemplated hereby do not conflict
with or result in any breach of any provisions of, constitute a default under,
result in a violation of, result in the creation of a right of termination or
acceleration of any lien, security interest, charge or encumbrance upon any
assets of the Buyer, or require any authorization, consent, approval, exemption
or other action by or notice to any court or other governmental body, under the
provisions of the Articles of Incorporation or Bylaws of Buyer or any indenture,
mortgage, lease, loan agreement or other agreement or instrument by which Buyer
is bound or affected, or any law, statute, rule or regulation or order, judgment
or decree to which Buyer is subject. This Agreement is, and the other documents
and instruments required hereby will be, when executed and delivered by Buyer
the valid and binding obligations of Buyer enforceable against Buyer in
accordance with their respective terms, subject only to bankruptcy, insolvency,
reorganization, moratoriums or similar laws at the time in effect affecting the
enforceability or right of creditors generally and by general equitable
principles which may limit the right to obtain equitable remedies.
5.3 Brokers. Neither this Agreement nor the sale and purchase of
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the Purchased Assets or any other transaction contemplated by this Agreement was
induced or procured through any Person acting on behalf of or representing Buyer
as broker, finder, investment banker, financial advisor or in any similar
capacity.
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ARTICLE VI
CERTAIN MATTERS PENDING THE CLOSING
From and after the Date of this Agreement, if prior to the Closing
Date, and until the Closing:
6.1 Access. Buyer and its authorized agents, officers and
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representatives shall have access to the Purchased Assets to conduct such
examination and investigation of the Purchased Assets as it deems necessary,
provided that such examinations shall be during the Seller's normal business
hours, and shall not interfere with Seller's operations.
6.2 Notice of Adverse Changes. Pending the Closing Date, Seller
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shall give Buyer prompt notice of the occurrence of any Event of Loss.
ARTICLE VII
CONDITIONS PRECEDENT TO THE OBLIGATIONS OF BUYER
The obligations of Buyer to be performed on the Closing Date shall be
subject to the satisfaction of the following conditions on or before the Closing
Date:
7.1 Compliance with Agreement. Seller shall have performed and
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complied with all of its material obligations under this Agreement which are to
be performed or complied with by it prior to or at the Closing;
7.2 Representations and Warranties. The representations and
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warranties made by Seller in Section IV of this Agreement shall be materially
true and correct as of the Closing Date with the same force and effect as though
such representations and warranties had been made on the Closing Date;
7.3 Event of Loss. Between the Date of this Agreement and the
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Closing, the Purchased Assets shall not have sustained an Event of Loss which
individually or in the aggregate would cost in excess of $20,000 to repair;
7.4 Deliveries at Closing. Seller shall have delivered or caused
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to be delivered to the Buyer the documents, each properly executed and dated as
of the Closing Date, required pursuant to Section 7.7;
7.5 Seller shall have performed in all material respects all of
the covenants and agreements required to be performed and complied with by it
under this Agreement prior to the Closing;
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7.6 Seller's Board of Directors shall have approved this Agreement
and the transactions contemplated hereby;
7.7 On the Closing Date, Seller shall have delivered to Buyer all
of the following:
(a) the Bill of Sale and such other instruments of
conveyance, transfer, assignment and delivery as Buyer shall have
reasonably requested pursuant to Section 2.3(a) hereof;
(b) a copy of the text of the resolutions adopted by the
board of directors of Seller authorizing the execution, delivery and
performance of this Agreement and the consummation of all of the
transactions contemplated by this Agreement; along with a certificate
executed on behalf of Seller, by its corporate secretary certifying to
Buyer that such copy is a true, correct and complete copy of such
resolutions, and that such resolutions were duly adopted and have not
been amended or rescinded;
(c) an officers' certificate executed on behalf of Seller
by its corporate secretary certifying the signature and office of each
officer executing this Agreement or any of the related documents;
(d) a certificate of good standing from the Secretary of
State of the State of Delaware, dated at or about the Closing, to the
effect that such corporation is in good standing under the laws of
such state; and
(e) an executed copy of each of the related documents.
If any of the conditions set forth in this Article VII have not been
satisfied, the Buyer may nevertheless elect to proceed with the consummation of
the transactions contemplated hereby. Any such election to proceed shall be
evidenced by a certificate signed on behalf of the Buyer by an officer of the
Buyer.
ARTICLE VIII
CONDITIONS PRECEDENT TO THE OBLIGATIONS OF SELLER
The obligations of Seller to consummate the transactions contemplated
by this Agreement are subject to the satisfaction of the following conditions on
or before the Closing Date:
8.1 Compliance with Agreement. Buyer shall have performed and
-------------------------
complied with all of its material obligations under this Agreement which are to
be performed or complied with by it prior to or at the Closing. Without limiting
the generality of the preceding sentence, for purposes of this Agreement, the
delivery of the Second Payment and the full Purchase Price shall be deemed a
material obligation.
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8.2 Representations and Warranties. The representations and
--------------------------------
warranties made by Buyer in this Agreement shall be true and correct as of the
Closing Date with the same force and effect as though such representations and
warranties had been made on the Closing Date;
8.3 Deliveries at Closing. In addition to the payments listed
-----------------------
under Section 2.2(a) of this Agreement, Buyer shall have delivered or caused to
be delivered to Seller the following documents, each properly executed and dated
as of the Closing Date:
(a) a promissory note (the "Note") in form and substance
substantially as set forth in Exhibit "E";
(b) a security agreement (the "Security Agreement") ") in
form and substance substantially as set forth in Exhibit "F";
(c) a State of Colorado UCC-1 ("UCC-1") in form and
substance substantially as set forth in Exhibit "G";
(d) a copy of the text of the resolutions adopted by the
board of directors of Buyer authorizing the execution, delivery and
performance of this Agreement and the consummation of all of the
transactions contemplated by this Agreement, along with a certificate
executed on behalf of Buyer by its corporate secretary certifying to
Seller that such copy is a true, correct and complete copy of such
resolutions, and that such resolutions were duly adopted and have not
been amended or rescinded, and
(e) an officers' certificate executed on behalf of Buyer
by its corporate secretary certifying the signature and office of each
officer executing this Agreement or any of the related documents;
(f) a certificate of good standing from the Secretary of
State of the State of Colorado, dated at or about the Closing, to the
effect that such corporation is in good standing under the laws of
such state; and
(g) such other documents as Seller shall reasonably
request.
8.4 Buyer shall have performed in all material respects all the
covenants and agreements required to be performed by it under this Agreement
prior to the Closing;
8.5 There shall not be threatened, instituted or pending any
action or proceeding, before any court or governmental authority or agency,
domestic or foreign, (i) challenging or seeking to make illegal, or to delay or
otherwise directly or indirectly restrain or prohibit, the consummation of the
transactions contemplated hereby or seeking to obtain material damages in
connection with such transactions, (ii) seeking to invalidate or render
unenforceable any material provision of this Agreement, or (iii) otherwise
relating to and materially adversely affecting the transactions contemplated
hereby; and
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8.6 There shall not be any action taken, or any statute, rule,
regulation, judgment, order or injunction, enacted, entered, enforced,
promulgated, issued or deemed applicable to the transactions contemplated hereby
by any federal, state or foreign court, government or governmental authority or
agency, which would reasonably be expected to result, directly or indirectly, in
any of the consequences referred to in Section 8.5 hereof.
If any of the conditions set forth in this Article VIII have not been
satisfied, Seller may nevertheless elect to proceed with the consummation of the
transactions contemplated hereby. Any such election to proceed shall be
evidenced by a certificate signed on behalf of Seller by an officer of Seller.
ARTICLE IX
INDEMNIFICATION
9.1 Survival of Representations and Warranties.
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Notwithstanding any investigation made by or on behalf of any of the
parties hereto or the results of any such investigation and notwithstanding the
participation of such party in the Closing, the representations and warranties
contained in this Agreement shall survive the Closing for a period of three
years following the Closing Date.
9.2 Indemnification by Seller.
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(a) Seller shall indemnify and hold Buyer harmless from
and against, and agree promptly to defend Buyer from and reimburse
Buyer for, any and all losses, damages, costs, expenses, liabilities,
obligations and claims of any kind (including, without limitation,
reasonable attorney fees and other legal costs and expenses) which
Buyer may at any time suffer or incur, or become subject to, as a
result of or in connection with any material breach or inaccuracy of
any of the representations and warranties made by Seller in or
pursuant to this Agreement, or in any instrument, certificate or
affidavit delivered by Seller at the Closing in accordance with the
provisions of any Section hereof.
(b) Nothing contained in this Section 9.2 shall provide
Seller with rights of indemnification or remedies against Buyer
greater than as set forth in Section 10.2 if the transactions
contemplated by this Agreement fail to close.
9.3 Indemnification by Buyer.
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(a) Buyer shall indemnify and hold Seller harmless from
and against, and agrees to promptly defend Seller from and reimburse
Seller for, any and all losses, damages, costs, expenses, liabilities,
obligations and claims of any kind (including, without limitation,
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reasonable attorney fees and other legal costs and expenses) which
Seller may at any time suffer or incur, or become subject to, as a
result of or in connection with:
(i) any material breach or inaccuracy of any
representations and warranties made by Buyer in or pursuant to
this Agreement, or in any certificate or affidavit delivered
by Buyer at the Closing in accordance with the provisions of
any Section hereof;
(ii) any failure by Buyer to carry out, perform,
satisfy and discharge any of its covenants, agreements,
undertakings, liabilities or obligations under this Agreement
or under any of the documents and materials delivered by Buyer
pursuant to this Agreement;
(iii) the Assumed Liabilities; or
(iv) the operation and ownership of the Purchased
Assets by Buyer from and after the Closing Date.
(b) Nothing contained in this Section 9.3 shall provide
Seller with rights of indemnification or remedies against Buyer
greater than as set forth in Section 10.2 if the transactions
contemplated by this Agreement fail to close.
9.4 Notification of Claims; Election to Defend.
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(a) A party entitled to be indemnified pursuant to
Section 9.2 or 9.3 (the "Indemnified Party") shall notify the party
liable for such indemnification (the "Indemnifying Party") in writing
of any claim or demand which the Indemnified Party has determined has
given or could give rise to a right of indemnification under this
Agreement. Subject to the Indemnifying Party's right to defend in good
faith third party claims as hereinafter provided, the Indemnifying
Party shall satisfy its obligations under this Article IX within
thirty (30) days after the receipt of written notice thereof from the
Indemnified Party.
(b) If the Indemnified Party shall notify the
Indemnifying Party of any claim or demand pursuant to Section 9.4(a),
and if such claim or demand relates to a claim or demand asserted by a
third party against the Indemnified Party which the Indemnifying Party
acknowledges is a claim or demand for which it must indemnify or hold
harmless the Indemnified Party under Section 9.2 or 9.3, the
Indemnifying Party shall have the right to employ counsel acceptable
to the Indemnified Party to defend any such claim or demand asserted
against the Indemnified Party. The Indemnified Party shall have the
right to participate in the defense of any such claim or demand. The
Indemnifying Party shall notify the Indemnified Party in writing, as
promptly as possible (but in any case before the due date for the
answer or response to a claim) after the date of the notice of claim
given by the Indemnified Party to the Indemnifying Party under Section
9.4(a) of its election to defend in good faith any such third party
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claim or demand. So long as the Indemnifying Party is defending in
good faith any such claim or demand asserted by a third party against
the Indemnified Party, the Indemnified Party shall not settle or
compromise such claim or demand. The Indemnified Party shall cooperate
with the Indemnifying Party with respect to such defense and shall
make available to the Indemnifying Party or its agents all records and
other materials in the Indemnified Party's possession reasonably
required by it for its use in contesting any third party claim or
demand. Whether or not the Indemnifying Party elects to defend any
such claim or demand, the Indemnified Party shall have no obligations
to do so.
ARTICLE X
TERMINATION; MISCELLANEOUS; CONFLICT OF INTEREST
10.1 Termination. This Agreement may be terminated and the
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transactions contemplated hereby may be abandoned at any time on or prior to the
Closing Date, as follows: (a) by mutual written agreement of Seller and Buyer;
or (b) by Buyer if any of the conditions set forth in Article VII of this
Agreement shall not have been fulfilled by the Closing Date; or (c) by Seller if
any of the conditions set forth in Article VIII of this Agreement shall not have
been fulfilled by the Closing Date.
10.2 Rights on Termination: Waiver.
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(a) If this Agreement is terminated pursuant to Section
10.1(a), then Seller shall keep the Earnest Money and all further
obligations of the parties under or pursuant to this Agreement shall
terminate without further liability of either party to the other.
(b) If this Agreement is terminated pursuant to Section
10.1(b) or 10.1(c), then the parties shall be free to pursue all legal
and equitable remedies, including specific performance, available to
them. If this Agreement is terminated pursuant to Section 10.1(b) and
Seller is in default in the performance of its material obligations
under this Agreement or has materially breached its representations and
warranties hereunder and fails to cure said default or breach within
five (5) calendar days of written notice from Buyer and Buyer is not in
default of its material obligations under this Agreement and has not
materially breached its representations and warranties hereunder, then
Seller shall keep the First Payment and shall return the Second Payment
to Buyer.
10.3 Bulk Transfer. Buyer and Seller hereby waive compliance with
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the Bulk Transfer provisions of the Uniform Commercial Code and all similar
laws.
10.4 Survival. The obligations to indemnify contained in Article IX
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hereof, the agreements contained herein and, as limited by the introductory
paragraphs of Articles IV and V hereof, the representations and warranties made
in this Agreement or made pursuant hereto shall survive the Closing and the
consummation of the transactions contemplated by this Agreement, and shall
survive any independent investigation by Buyer or Seller, and any dissolution,
merger or consolidation of Buyer or Seller and shall bind the legal
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representatives, assigns and successors of Buyer and Seller for a period of
three (3) years after the Closing Date.
10.5 Entire Agreement; Amendment; and Waivers. This Agreement and
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the documents referred to herein and to be delivered pursuant hereto constitute
the entire agreement between the parties pertaining to the subject matter
hereof, and supersede all prior and contemporaneous agreements, understandings,
negotiations and discussions of the parties, whether oral or written, and there
are no warranties, representations or other agreements between the parties in
connection with the subject matter hereof, except as specifically set forth
herein. No amendment, supplement, modification, waiver or termination of this
Agreement shall be binding unless executed in writing by the party to be bound
thereby. No waiver of any of the provisions of this Agreement shall be deemed or
shall constitute a waiver of any other provision or breach of this Agreement,
whether or not similar, unless otherwise expressly provided.
10.6 Expenses. Except as otherwise specifically provided herein,
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whether or not the transactions contemplated by this Agreement are consummated,
each of the parties shall pay the fees and expenses of its respective counsel,
accountants and other experts incident to the negotiation and preparation of
this Agreement and consummation of the transactions contemplated hereby.
10.7 Benefit; Assignment. This Agreement shall be binding upon and
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inure to the benefit of and shall be enforceable by Buyer and Seller and their
successors and assigns. This Agreement shall not be assigned by any party
without the prior written consent of the other party.
10.8 Confidentiality. Buyer agrees that prior to Closing, Buyer and
---------------
its respective agents and representatives shall not use for its or their own
benefit (except when directed by a court or as otherwise required by law), and
shall hold in strict confidence and not disclose, (i) any data or information
relating to Seller, or its Affiliates obtained from Seller or any of its
directors, officers, employees, agents or representatives in connection with
this Agreement, or (ii) any data and information relating to the business,
customers, financial statements, conditions or operations of the Seller which is
confidential in nature and not generally known to the public (clauses (i) and
(ii) together, "Seller's Information"). If the transactions contemplated in this
Agreement are not consummated for any reason, Buyer shall return to Seller all
data, information and any other written material obtained by Buyer from Seller
in connection with this transaction and any copies, summaries or extracts
thereof, and shall refrain from disclosing any of Seller's Information to any
third party or using any of Seller's Information for its own benefit or that of
any other person.
10.9 Notice. All notices, consents, waivers, and other
------
communications under this Agreement must be in writing and will be deemed to
have been duly given when (a) delivered by hand (with written confirmation of
receipt), (b) sent by facsimile (with written confirmation of receipt), provided
that a copy is mailed by certified mail, return receipt requested (provided that
facsimile notice shall be deemed received on the next business day if received
after 5:00 p.m. Eastern Standard Time), or (c) when received by the addressee,
if sent by a nationally recognized overnight delivery service (receipt
requested), in each case to the appropriate addresses and facsimile numbers set
Page 13 of 32
<PAGE>
forth below (or to such other addresses and facsimile numbers as a party may
designate by notice to the other parties):
If to Seller:
VDC TELECOMMUNICATIONS, INC.
Attn: Frederick A. Moran, President
75 Holly Hill Lane
Greenwich, CT 06830
(203) 552-0908 (facsimile)
If to Buyer:
OMNETRIX INTERNATIONAL, INC.
Attn: William Van Vliet, President
3025 South Parker Road
Suite 705
Aurora, CO 80014
(303) 743-7835 (facsimile)
10.10 Counterparts; Headings. This Agreement may be executed in
----------------------
multiple counterparts each of which shall be an original but all of which
together shall constitute one and the same instrument. This Agreement may also
be executed and delivered by exchange of facsimile copies showing the signatures
of the parties, and those signatures need not be affixed to the same copy. The
facsimile copies showing the signatures of the parties will constitute
originally signed copies of the Agreement requiring no further execution. The
Article and Section headings in this Agreement are inserted for convenience of
reference only and shall not constitute a part hereof.
10.11 Income Tax Position. Neither Buyer nor Seller shall take a
--------------------
position for income tax purposes which is inconsistent with this Agreement.
10.12 Severability. The invalidity or unenforceability of any term
------------
of this Agreement shall not affect the validity or enforeceability of this
Agreement or any of its other terms; in the event that any court or arbitrator
determines that any provision of this Agreement is invalid or unenforceable, as
the case may be, then, and in either such event, neither the enforceability nor
the validity of said paragraph or section as a whole shall be affected. Rather,
the scope of said paragraph or section shall be revised by the court or
arbitrator as little as possible to make the paragraph or section enforceable.
If the court or arbitrator will not revise said paragraph or section, then this
Agreement shall be construed as though the invalid or unenforceable term(s) were
not included herein.
10.13 Judicial Interpretation. Should any provision of this
------------------------
Agreement require judicial interpretation, the parties hereto agree that the
court interpreting or construing the same shall not apply a presumption that the
terms hereof shall be more strictly construed against one party by reason of the
Page 14 of 32
<PAGE>
rule of construction that a document is to be construed more strictly against
the party which itself or through its agent prepared the same, it being agreed
that the agents of each party have participated in the preparation hereof.
10.14 Governing Law; Jurisdiction; Trial by Jury. This Agreement
-------------------------------------------
shall be governed by and construed in accordance with the internal substantive
and procedural laws of the State of Colorado without regard to conflict of laws
principles. The parties consent to the personal jurisdiction and venue of the
United States District Court for the District of Colorado in Denver, Colorado.
The parties waive any objection relating to improper venue or forum non
conveniens to the conduct of any proceeding in either such court. At the
Seller's sole election and determination, any legal, equitable, or arbitration
action may also be brought in the State of Connecticut or in any other state or
federal court of competent jurisdiction in any state in which the Buyer has
assets and the parties waive any objection relating to improper venue or forum
non conveniens to the conduct of any proceeding in any such court. The parties
expressly waive any right to a trial by jury.
10.15 Remedies Cumulative. Each right and remedy granted to Seller
-------------------
under this Agreement shall be cumulative and in addition to any other right or
remedy existing in equity, at law, by virtue of statute or otherwise, and may be
exercised by Seller from time to time concurrently or independently and as often
and in such order as Seller may elect. Any failure or delay on the part of
Seller in exercising any such right or remedy shall not operate as a waiver
thereof.
10.16 Saturdays, Sundays and Legal Holidays. If the time period by
--------------------------------------
which any acts or payments required hereunder must be performed or paid expires
on a Saturday, Sunday or legal holiday, then such time period shall be
automatically extended to the close of business on the next regularly scheduled
business day.
[Remainder of page left blank]
Page 15 of 32
<PAGE>
IN WITNESS WHEREOF, the parties have executed this Purchase
and Sale Agreement as of the day and year first above written.
"SELLER"
WITNESS: VDC TELECOMMUNICATIONS, INC.
/s/ Clayton F. Moran
---------------------------
Signature
Clayton F. Moran By: /s/ Frederick A. Moran
--------------------------- -----------------------------------------
Print Name Frederick A. Moran
President
"BUYER"
WITNESS: OMNETRIX INTERNATIONAL, INC.
/s/ Richard Krumbein
---------------------------
Signature
Richard Krumbein By:/s/ William Van Vliet
--------------------------- -----------------------------------------
Print Name William Van Vliet
President
Page 16 of 32
<PAGE>
SCHEDULE 2.7
Page 17 of 32
<PAGE>
EXHIBIT "A"
-----------
BILL OF SALE
Page 18 of 32
<PAGE>
EXHIBIT "B"
-----------
OFFICERS CERTIFICATE
OMNETRIX INTERNATIONAL, INC.
I, the undersigned, President of OMNETRIX INTERNATIONAL, INC.,
("Omnetrix"), a corporation organized and existing under the laws of the State
of Colorado, DO HEREBY CERTIFY that:
1. This Certificate is furnished pursuant to Section VIII of the
Purchase and Sale Agreement (the "Agreement"), dated as of August ___, 2000,
between Omnetrix and VDC Telecommunications, Inc., a Delaware corporation
("VDC"). Unless otherwise defined herein capitalized terms used in this
Certificate have the meanings assigned to these terms in the Agreement.
2. The persons named below have been duly elected, have duly
qualified as and at all time since [____________] (to and including and date
hereof) have been officers of Omnetrix, holding the respective offices below set
opposite their names, and the signatures below set opposite their names are
their genuine signatures.
Name Office Signature
---- ------ ---------
William Van Vliet President
--------------------------
William Van Vliet Secretary
--------------------------
3. Attached hereto as Attachment A is a copy of the Certificate
of Incorporation of Omnetrix, as filed in the Office of the Secretary of State
on January 19, 2000, together with all amendments thereto adopted through the
date hereof.
4. Attached hereto as Attachment B is a true and correct copy of
the By-Laws of Omnetrix, as in effect on January 24, 2000, together with all
amendments thereto adopted through the date hereof.
5. Attached hereto as Attachment C is a true and correct copy of
resolutions duly adopted by the Board of Directors of Omnetrix at a meeting on
__________, 2000, at which a quorum was present and acting throughout, which
resolutions have not been revoked, modified, amended or rescinded and are still
in full force and effect. No new resolutions have been adopted by the Board of
Directors of Omnetrix which deal with the execution, delivery or performance of
the Agreement.
Page 19 of 32
<PAGE>
6. On the date hereof, the representations and warranties
contained in Article V of the Agreement are true and correct.
IN WITNESS WHEREOF, I have hereunto set my hand this ___ of ________,
2000.
OMNETRIX INTERNATIONAL, INC.
By
-------------------------------
Name: William Van Vliet
Title: President
I, the undersigned, Secretary of Omnetrix, DO HEREBY CERTIFY that:
1. The Person making the above certifications is the duly elected
and qualified President of Omnetrix and the signature above is her genuine
signature.
2. The certifications made by William Van Vliet in items 2, 3, 4,
5 and 6 above are true and correct.
IN WITNESS WHEREOF, I have hereunto set my hand this ___ of _____,
2000.
OMNETRIX INTERNATIONAL, INC.
By
--------------------------------
Name: William Van Vliet
Title: Secretary
Page 20 of 32
<PAGE>
ATTACHMENT A
CERTIFICATE OF INCORPORATION OF OMNETRIX
Page 21 of 32
<PAGE>
ATTACHMENT B
BYLAWS OF OMNETRIX
Page 22 of 32
<PAGE>
ATTACHMENT C
CERTIFICATE OF SECRETARY OF
OMNETRIX INTERNATIONAL, INC.
I, William Van Vliet, Secretary of OMNETRIX INTERNATIONAL, INC., a
Colorado corporation ("Omnetrix"), HEREBY CERTIFY that at a special meeting of
the Board of Directors of Omnetrix held on _______, 2000, a corporate resolution
was adopted authorizing William Van Vliet, President of Omnetrix to execute on
behalf of Omnetrix the Purchase and Sale Agreement (the "Agreement") dated
August 26, 2000 between Omnetrix and VDC Telecommunications, Inc., a Delaware
corporation ("VDC"), the promissory notes, security agreement, Colorado UCC-1
Financing Statement and any and all documents necessary to give effect to the
transactions contemplated by the Agreement.
I FURTHER CERTIFY that William Van Vliet , President of Omnetrix has
the authority to execute on behalf of Omnetrix the Agreement and any and all
documents, including agreements, promissory notes, and security agreements,
necessary for Omnetrix to purchase from VDC, subject to the terms and conditions
of the Agreement, the Purchased Assets listed in Exhibit "C" of the Agreement,
and assume all obligations under the Agreement.
I FURTHER CERTIFY that Omnetrix has the necessary authority to execute
and deliver, and to perform its obligations under the Agreement.
IN WITNESS WHEREOF, the undersigned has subscribed his name and affixed
the seal of Omnetrix this ____ day of ______, 2000.
By:
---------------------------------
Secretary
Page 23 of 32
<PAGE>
EXHIBIT "C"
-----------
A Telecommunications Switch manufactured by Siemens Stromberg Carlson, which
includes:
- Rel 15.09 DCO-CS E/W for 2304 ports incl. Toll Free Number Expansion
and 4 Digit CIC
- Enhanced SS7 with 800 portability, incl. SS7 backward call indication
and circuit ID
- SS7 spares
- Qty.2 additional pairs A-links
- Route by ANI on any 700/800 number
- ISDN transport
- DTF and Digital Interface CUA for ISDN transport
- Digital I/F CUA for ISDN transport
- Qty. 3 Digital Interface Unit PWBA's
- Real Time ANI
Page 24 of 32
<PAGE>
EXHIBIT "D"
-----------
OFFICERS' CERTIFICATE
VDC TELECOMMUNICATIONS, INC.
I, the undersigned, President of VDC TELECOMMUNICATIONS, INC., ("VDC"),
a corporation organized and existing under the laws of the State of Delaware, DO
HEREBY CERTIFY that:
1. This Certificate is furnished pursuant to Section VII of the
Purchase and Sale Agreement (the "Agreement"), dated as of August 26, 2000,
between VDC and Omnetrix International, Inc., a Colorado corporation
("Omnetrix"). Unless otherwise defined herein capitalized terms used in this
Certificate have the meanings assigned to these terms in the Agreement.
2. The persons named below have been duly elected, have duly
qualified as and at all time since ____________, 19__ (to and including and date
hereof) have been officers of VDC, holding the respective offices below set
opposite their names, and the signatures below set opposite their names are
their genuine signatures.
Name Office Signature
---- ------ ---------
Frederick A. Moran President
-----------------------
Frederick A. Moran Secretary
-----------------------
3. Attached hereto as Attachment A is a copy of the Certificate
of Incorporation of VDC, as filed in the Office of the Delaware Secretary of
State on _______________, 19__, together with all amendments thereto adopted
through the date hereof.
4. Attached hereto as Attachment B is a true and correct copy of
the By-Laws of VDC, as in effect on _____________, 19__, together with all
amendments thereto adopted through the date hereof.
5. Attached hereto as Attachment C is a true and correct copy of
resolutions duly adopted by the Board of Directors of VDC at a meeting on
____________, 2000, at which a quorum was present and acting throughout, which
resolutions have not been revoked, modified, amended or rescinded and are still
in full force and effect. Except as attached hereto as Attachment C, no
resolutions have been adopted by the Board of Directors of VDC which deal with
the execution, delivery or performance of the Agreement.
Page 25 of 32
<PAGE>
6. On the date hereof, the representations and warranties
contained in Article IV of the Agreement are true and correct.
IN WITNESS WHEREOF, I have hereunto set my hand this ___ of
___________, 2000.
VDC TELECOMMUNICATIONS, INC.
------------------------------------
Name: Frederick A. Moran
Title: President
I, the undersigned, [Secretary/Assistant Secretary] of VDC, DO HEREBY
CERTIFY that:
1. The person making the above certifications is the duly elected
and qualified President of VDC and the signature above is his/her genuine
signature.
2. The certifications made by Frederick A. Moran in items 2, 3,
4, 5 and 6 above are true and correct.
IN WITNESS WHEREOF, I have hereunto set my hand this ___ of _________,
2000.
VDC TELECOMMUNICATIONS, INC.
By:
---------------------------------
Name: Frederick A. Moran
Title: Secretary
Page 26 of 32
<PAGE>
ATTACHMENT A
VDC ARTICLES OF INCORPORATION
Page 27 of 32
<PAGE>
ATTACHMENT B
VDC BYLAWS
Page 28 of 32
<PAGE>
ATTACHMENT C
CERTIFICATE OF SECRETARY OF
VDC TELECOMMUNICATIONS, INC.
I, Frederick A. Moran, Secretary of VDC TELECOMMUNICATIONS, INC., a
Delaware corporation ("VDC"), HEREBY CERTIFY that at a special joint meeting of
the Board of Directors of VDC held on __________, 2000, a corporate resolution
was ratified and adopted authorizing Frederick A. Moran, President of VDC to
execute on behalf of VDC the Purchase and Sale Agreement (the "Agreement") dated
August 26, 2000 between VDC and Omnetrix International, Inc., a Colorado
corporation ("Omnetrix"), and any and all documents necessary to give effect to
the transactions contemplated by the Agreement.
I FURTHER CERTIFY that Frederick A. Moran, President of VDC has the
authority to execute on behalf of VDC the Agreement and any and all documents
necessary for VDC to sell and irrevocably and unconditionally assign to
Omnetrix, subject to the Agreement, the Purchased Assets listed in Exhibit "C"
of the Agreement).
I FURTHER CERTIFY that VDC has the necessary authority to execute and
deliver, and to perform its obligations under the Agreement.
IN WITNESS WHEREOF, the undersigned has subscribed his name and affixed
the seal of VDC this ____ day of __________, 2000.
By:
---------------------------------
Secretary
Page 29 of 32
<PAGE>
EXHIBIT "E"
-----------
PROMISSORY NOTE
Page 30 of 32
<PAGE>
EXHIBIT "F"
-----------
SECURITY AGREEMENT
Page 31 of 32
<PAGE>
EXHIBIT "G"
-----------
UCC-1
Page 32 of 32
