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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 OF 1934
Date of Report (Date of earliest event reported): November 13, 1996
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PREMIERE TECHNOLOGIES, INC.
(Exact name of registrant
as specified in its charter)
Georgia 33-80547 59-3074176
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(State or other (Commission (I.R.S. Employer
jurisdiction of File Number) Identification No.)
incorporation)
3399 Peachtree Road, N.E.
The Lenox Building
Suite 400, Atlanta, Georgia 30326
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(Address of principal executive officers) (Zip Code)
Registrant's telephone number, including area code: (404) 262-8400
N/A
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(Former name or former address, if changed since last report)
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Item 5. Other Events.
On November 13, 1996, Premiere Technologies, Inc. ("Premiere") and
WorldCom, Inc. ("WorldCom") entered into a Strategic Alliance Agreement (the
"Agreement"). The agreement provides for a long-term relationship between the
parties under which Premiere became a preferred platform services provider for
WorldCom and its subsidiaries with respect to enhanced calling programs.
Premiere and WorldCom agreed to identify and pursue opportunities to sell each
company's services and products to the other company's customers, and Premiere
and WorldCom agreed to develop joint service offerings to be marketed to third
parties. Under the Agreement, Premiere issued 2,050,000 shares of its $.01 par
value per share common stock (the "Shares") and paid $4,700,000 in cash to
WorldCom, and WorldCom transferred to Premiere certain assets held by WorldCom.
In connection with the issuance of the Shares, Premiere and WorldCom entered
into an Investment Agreement providing Premiere with certain rights of first
refusal with respect to disposition of the Shares and providing WorldCom with
certain registration rights with respect to the Shares. The Agreement is subject
to a number of other terms and conditions, including rights of termination, as
set forth therein.
Item 7. Exhibits.
(c) Exhibits.
10.1 Strategic Alliance Agreement dated November 13, 1996, by and
between Premiere Technologies, Inc. and WorldCom, Inc.(1)
10.2 Investment Agreement dated November 13, 1996, by and between
Premiere Technologies, Inc. and WorldCom, Inc.
10.3 Press Release dated November 13, 1996.
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(1) Portions of this exhibit are the subject of a Request for Confidential
Treatment. The copy filed as an exhibit omits the information subject to
the confidentiality request.
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EXHIBIT INDEX
10.1 Strategic Alliance Agreement dated November 13, 1996,
by and between Premiere Technologies, Inc. and WorldCom, Inc.(1)
10.2 Investment Agreement dated November 13, 1996,
by and between Premiere Technologies, Inc. and WorldCom, Inc.
10.3 Press Release dated November 13, 1996.
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(1) Portions of this exhibit are the subject of a Request for Confidential
Treatment. The copy filed as an exhibit omits the information subject to
the confidentiality request.
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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.
PREMIERE TECHNOLOGIES, INC.
By: /s/ Patrick G. Jones
-------------------------------------------
Patrick G. Jones
Senior Vice President of Finance and Legal
Dated: November 13, 1996
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EXHIBIT 10.1
Portions of this exhibit for which confidential treatment has been requested are
marked by brackets [ ] and the pages on which they appear contain an asterisk
(*) in the upper right hand corner.
STRATEGIC ALLIANCE AGREEMENT
----------------------------
THIS STRATEGIC ALLIANCE AGREEMENT (this "Agreement") is made and
entered into as of the 13th day of November, 1996, by and between PREMIERE
TECHNOLOGIES, INC., a Georgia corporation ("Premiere"), and WORLDCOM, INC., a
Georgia corporation ("WorldCom").
Preamble
--------
Premiere and WorldCom desire to enter into a strategic relationship
for their mutual benefit. Pursuant to this relationship, among other things,
(i) WorldCom will make an investment in Premiere Common Stock, (ii) Premiere
will acquire certain assets from WorldCom's Subsidiaries, (iii) Premiere,
through its Subsidiaries, will provide certain computer telephony services to
WorldCom and its Subsidiaries, and (iv) Premiere and WorldCom, through their
respective Subsidiaries, will identify, pursue and implement certain joint
service offerings to third parties. Premiere and WorldCom believe that the
strategic relationship envisioned in this Agreement will represent an efficient
allocation and utilization of the respective resources of the Parties and will
lead to the development of long term business opportunities and relationships in
a more efficient and effective manner than could be achieved by the Parties
acting alone.
Certain terms used in this Agreement are defined in Section 10.1 of
this Agreement.
ARTICLE 1
WORLDCOM INVESTMENT IN PREMIERE
-------------------------------
1.1 Issuance of Premiere Shares; Cash Payment. In consideration of
-----------------------------------------
the covenants and agreements of WorldCom contained herein and in the Related
Agreements and of the strategic relationship embodied therein, and based upon
the representations and warranties of WorldCom contained herein and in the
Related Agreements, on the date of this Agreement, Premiere shall (a) issue to
WorldCom 2,050,000 shares of Premiere Common Stock, and (b) pay to the order of
WorldCom Four Million Seven Hundred Thousand Dollars ($4,700,000) in cash by
wire transfer to such account as WorldCom shall designate.
1.2 Investment Agreement. As a condition to the issuance of the
--------------------
shares of Premiere Common Stock pursuant to Section 1.1, WorldCom shall enter
into an Investment Agreement with Premiere in the form of Exhibit A (the
---------
"Investment Agreement"), which shall govern WorldCom's investment in Premiere.
WorldCom acknowledges and agrees that the provisions of and restrictions
contained in the Investment Agreement are reasonably related to the promotion of
the strategic relationship
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envisioned by this Agreement and do not unreasonably restrain the alienability
of its investment in Premiere.
ARTICLE 2
PREMIERE PURCHASE OF WORLDCOM ASSETS
------------------------------------
2.1 Purchase and Sale. In consideration of the covenants and
-----------------
agreements of Premiere contained herein, on the date of this Agreement, WorldCom
shall itself and shall cause its relevant Subsidiaries to sell, grant, convey,
assign, transfer and deliver to Premiere, and Premiere shall purchase from
WorldCom and the relevant WorldCom Subsidiaries, the WorldCom Assets, free and
clear of all Liens.
2.2 Transfer Documents. The sale of the WorldCom Assets shall be
------------------
effected through the execution and delivery to Premiere by WorldCom and the
relevant WorldCom Subsidiary of an Assignment Agreement and an Irrevocable Stock
Power in the form of Exhibits B-1 and B-2, respectively (the "Assignment
--------------------
Agreement" and "Irrevocable Stock Power", respectively), together with such
other instruments, financing statements and other documents as Premiere shall
reasonably request to effect and perfect the transfer of title to the WorldCom
Assets to Premiere free and clear of all Liens.
ARTICLE 3
PREMIERE PLATFORM SERVICES
--------------------------
3.1 Preferred Platform Service Provider. Subject to the provisions
-----------------------------------
of Sections 3.2 and 3.3, Premiere, either directly or through one or more of its
Subsidiaries, shall be a "preferred provider" of Platform Services for Enhanced
Calling Programs provided by the WorldCom Companies. As a "preferred provider"
of Platform Services for the WorldCom Companies, Premiere shall (a) be the
exclusive provider of Platform Services for the Enhanced Calling Programs in
development described on Schedule 3.1 hereto (the "Exclusive Programs"), and (b)
be given the right of first opportunity to provide, on a non-exclusive basis,
Platform Services for other Enhanced Calling Programs (the "Preferred Programs")
as set forth in Section 3.2.
3.2 Right of First Opportunity. If any WorldCom Company proposes to
--------------------------
offer a Preferred Program through an unaffiliated provider of Platform Services,
including a Preferred Program that would entail the provision of services or
special applications that are not then in a service offering provided by a
Premiere Company ("Special Services"), WorldCom shall notify Premiere and shall
provide Premiere with the right of first opportunity to provide the Platform
Services relating to the Preferred Program. In furtherance of this obligation,
WorldCom (a) shall provide the notice sufficiently in advance of the anticipated
date of introduction of the Preferred Program (or the anticipated date of use of
an unaffiliated Platform Services provider relating to an existing Preferred
Program), (b) shall consult with the Premiere Representatives concerning the
proposed Preferred Program and (c) shall provide the Premiere Representatives
with such information as to the Preferred Program (e.g., anticipated service
volume, services
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contemplated, including any Special Services and other matters) as the Premiere
Representatives may request. Following such notice, consultation and provision
of information, Premiere shall notify WorldCom in a reasonably prompt manner if
it wishes to exercise its right of first opportunity hereunder. If it so
exercises its right, Premiere and WorldCom shall negotiate in good faith an
agreement concerning the time and requirements for the development of the
Preferred Program, including any Special Services, and the other terms of
Platform Services, including price, and shall incorporate those terms in an
agreement to provide Platform Services as contemplated by Section 3.3 During the
course of those negotiations WorldCom may solicit proposals from alternative
unaffiliated providers of Platform Services, and, if any such bona fide proposal
is received from a qualified alternative service provider, WorldCom shall
provide Premiere with a copy of, and other information as Premiere may
reasonably request concerning, any such proposal. WorldCom shall provide
Premiere with a reasonable opportunity to review any such proposal and to submit
a new or revised proposal in response. If, in its response, Premiere is unable
or unwilling to match the service offering, quality, pricing and other material
terms contained in a bona fide proposal received by WorldCom from such an
alternative provider, WorldCom may contract with such alternative provider to
provide Platform Services on those terms.
3.3 Form of Platform Services Agreement. The relevant Premiere
-----------------------------------
Company shall provide the Platform Services pursuant to the terms and conditions
of the form of Platform Services Agreement attached as Exhibit C hereto
---------
("Platform Services Agreement") in each case, with appropriate modifications as
mutually acceptable to the Parties to reflect modifications of service
offerings, service standards, pricing, billing arrangements, term and other
matters.
ARTICLE 4
JOINT SERVICE OFFERINGS
-----------------------
4.1 Identification and Pursuit of Offerings. WorldCom and Premiere
---------------------------------------
shall cooperate in good faith and use their respective reasonable best efforts
during the term of this Agreement to identify and pursue opportunities to (a)
sell Premiere Platform Services to various customer contacts of WorldCom, (b)
sell WorldCom voice and data transmission services to various customer contacts
of Premiere, and (c) jointly market Premiere Platform Services and WorldCom
voice and data transmission services to other Persons (collectively, "Joint
Service Offerings"). In furtherance of this effort, WorldCom and Premiere shall
form the Strategic Alliance Committee consisting of WorldCom Representatives and
Premiere Representatives, which shall (i) identify Joint Service Offering
opportunities, (ii) develop marketing strategies for those opportunities,
including service mix and pricing strategies, (iii) coordinate the formation of
the marketing team, (iv) oversee the implementation of the marketing effort,
(iv) oversee the administration of product and service offerings and programs
arising from those marketing efforts, and (v) report on a regular basis to
WorldCom and Premiere regarding the Joint Service Offerings identified, pursued
and implemented. The Strategic Alliance Committee shall meet as
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often as required to carry out its objectives, but in no event less than once
per calendar quarter. WorldCom and Premiere shall cooperate fully with the
Strategic Alliance Committee to support its efforts, including, without
limitation, the provision of information on business opportunities as the
Committee may request from time to time.
4.2 Revenue Sharing Arrangements. In connection with the pursuit of
----------------------------
Joint Service Offerings, WorldCom and Premiere (or their appropriate
Subsidiaries) will negotiate in good faith to enter into marketing or other
agreements with the other Persons involved in the Joint Service Offering ("Joint
Marketing Agreements"). The Joint Marketing Agreements will include, among
other matters, provisions relating to the sharing of revenues produced pursuant
to services provided in connection with the Joint Service Offering . Subject to
variances and other terms as may be negotiated in good faith among the various
parties to the Joint Marketing Agreements, WorldCom and Premiere anticipate that
the revenue sharing arrangements generally will be structured according to the
example set forth on Schedule 4.2 hereto.
------------
4.3 Protection of Business Opportunity. Premiere and WorldCom agree
----------------------------------
that the Joint Marketing Agreements will provide that (a) so long as any
customer serviced under the Joint Service Offering subject to a Joint Marketing
Agreement remains in place, the revenue sharing agreement set forth in the Joint
Marketing Agreement shall stay in effect, and (b) so long as a Joint Service
Offering is active, a WorldCom Company will provide voice and data transmission
services, and a Premiere Company will provide all Platform Services, on the
terms set forth in the Joint Marketing Agreement, subject to termination only
for default as set forth therein.
4.4 Right to Pursue Opportunities Independently. Notwithstanding the
-------------------------------------------
provisions of this Article 4, but subject to the other provisions of this
Agreement, Premiere and WorldCom understand that the Premiere Companies and
WorldCom Companies are engaging, and may in the future engage, in business
activities competitive with the respective businesses of each other. Subject to
any conflicting provisions of this Agreement and to any specific conflicting
provisions of any Related Agreement, the Parties agree that the Premiere
Companies and the WorldCom Companies may engage in such activities and that no
Party shall bring any action against the other Party claiming that any such
activity is in violation of any duty owed to each other hereunder.
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ARTICLE 5
MINIMUM OPERATING INCOME GUARANTEE
----------------------------------
5.1 Minimum Monthly Operating Income. For the [ * ]
--------------------------------
period beginning [ * ] and ending [ * ] (the "Minimum Guarantee
Period"), WorldCom agrees to pay to Premiere on or before the end of the month
(the "Payment Date") following each month (a "Base Month") in the Minimum
Guarantee Period, the positive difference, if any, between (a)[ * ]
and (b) the Aggregate Operating Income received by any Premiere Company for the
Base Month (such difference being a "Monthly Deficiency Payment"). If,
subsequent to a Payment Date, any Premiere Company receives a payment relating
to a previous Base Month that would have counted toward the Aggregate Operating
Income amount for that Base Month, such amount shall be added to and become part
of the calculation of Aggregate Operating Income for the month in which it is so
received. Such payments shall be considered "License Fee" revenues to Premiere.
5.2 Late Payment Charge. If WorldCom does not make a required
-------------------
Monthly Deficiency Payment on or before the relevant Payment Date, WorldCom
shall also pay a late fee computed daily commencing with the day immediately
following the Payment Date on the amount of the unpaid balance of the Monthly
Deficiency Payment at the lesser of (a) one and one half percent (1-1/2%) per
month or (b) the maximum rate allowed under applicable Law (a "Late Payment
Charge").
5.3 Rights of Set Off. The Premiere Companies shall have the right
-----------------
to set off against any amounts otherwise payable by a Premiere Company to a
WorldCom Company the amount of any unpaid Monthly Deficiency Payment and Late
Payment Charge due hereunder. The WorldCom Companies shall have the right to
set off against any amounts otherwise payable by a WorldCom Company to a
Premiere Company any unpaid amount due from a Premiere Company to a WorldCom
Company.
5.4 Early Termination of Minimum Commitment. The obligation to pay
---------------------------------------
Monthly Deficiency Payments shall terminate on the first to occur of (a) the
date all Monthly Deficiency Payments for the Minimum Guarantee Period have been
received by Premiere, or (b) the date on which the sum of (i) the Aggregate
Operating Income received by all Premiere Companies for all previous Base Months
and (ii) the aggregate Monthly Deficiency Payments (not including Late Payment
Charges) received by Premiere equals or exceed [ * ].
* These portions are subject to a Request for Confidential Treatment.
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ARTICLE 6
REPRESENTATIONS AND WARRANTIES
------------------------------
6.1 Representations and Warranties of Premiere. Premiere hereby
------------------------------------------
represents and warrants to WorldCom as follows:
(a) Premiere is a corporation duly organized, validly existing
and in good standing under the laws of the State of Georgia. Premiere has all
requisite corporate power and authority to own, lease and operate its
properties, to carry on its business as now being conducted and to execute and
deliver this Agreement and to perform its terms.
(b) The execution and delivery of this Agreement and the
consummation of the transactions contemplated herein, have been duly and validly
authorized by all necessary corporate action in respect thereof on the part of
Premiere. This Agreement has been duly and validly executed by Premiere and,
assuming this Agreement constitutes a valid and binding agreement of WorldCom,
represents a valid and binding obligation of Premiere, enforceable in accordance
with its terms subject to the Bankruptcy Exception. The execution, delivery and
performance of this Agreement, and the consummation of the transactions
contemplated hereby, will not conflict with or constitute a breach, violation or
default, or create a Lien, under the Articles of Incorporation or Bylaws of
Premiere or any Law or any judgment, decree, governmental permit or license or
permit, indenture, agreement or instrument of Premiere or to which Premiere is
subject.
(c) The authorized capital stock of Premiere consists of (i)
150,000,000 shares of Premiere Common Stock, of which 21,683,377 shares are
issued and outstanding as of the date of this Agreement, and (ii) 5,000,000
shares of Premiere Preferred Stock, of which no shares are issued and
outstanding. All of the issued and outstanding shares of Premiere Common Stock
are, and all of the shares of Premiere Common Stock to be issued in accordance
with the terms of this Agreement will be, duly authorized, validly issued and
outstanding, fully paid and nonassessable. None of the outstanding shares of
Premiere Common Stock has been, and none of the shares of Premiere Common Stock
to be issued in accordance with the terms of this Agreement will be, issued in
violation of any preemptive rights of any Person or the registration
requirements of applicable Law. There are no restrictions upon the transfer of
or otherwise pertaining to the shares of Premiere Common Stock (including,
without limitation, the ability to pay dividends thereon) or retained earnings
of Premiere or the ownership thereof, other than those imposed by applicable
securities or corporate Law and the Investment Agreement
(d) Premiere has timely filed and made available to WorldCom all
SEC Documents required to be filed by Premiere since December 31, 1995 (the
"Premiere SEC Reports"). The Premiere SEC Reports (i) at the time filed,
complied in all material respects with the applicable requirements of the
Securities Laws and other applicable
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Laws and (ii) did not, at the time they were filed (or, if amended or superseded
by a filing prior to the date of this Agreement, then on the date of such
filing) contain any untrue statement of a material fact or omit to state a
material fact required to be stated in such Premiere SEC Reports or necessary in
order to make the statements in such Premiere SEC Reports, in light of the
circumstances under which they were made, not misleading. Other than the
execution and delivery of this Agreement, no event has occurred as a consequence
of which Premiere would be required to file a Current Report on Form 8-K as to
which such a report has not been timely filed with the SEC.
(e) Each of the Premiere Financial Statements (including, in each
case, any related notes) contained in the Premiere SEC Reports complied as to
form in all material respects with the applicable published rules and
regulations of the SEC with respect thereto, was prepared in accordance with
GAAP (except to the extent required by changes in generally accepted accounting
principles, as may be indicated in the notes to such financial statements or, in
the case of unaudited interim statements, as permitted by Form 10-Q of the SEC),
and fairly presented in all material respects the consolidated financial
position, assets and liabilities of Premiere and its Subsidiaries as at the
respective dates and the consolidated results of operations and cash flows for
the periods indicated, except that the unaudited interim financial statements
were or are subject to normal and recurring year-end adjustments which were not
or are not expected to be material in amount or effect.
(f) No Premiere Company has any Liabilities that are reasonably
likely to have, individually or in the aggregate, a Material Adverse Effect on
Premiere, except Liabilities which are accrued or reserved against in the
consolidated balance sheets of Premiere as of December 31, 1995 and June 30,
1996, included in the Premiere Financial Statements or SEC Reports delivered
prior to the date of this Agreement or reflected in the notes thereto. Except as
set forth on the Premiere Disclosure Memorandum, no Premiere Company has
incurred or paid any Liability since June 30, 1996, except for such Liabilities
incurred or paid (i) in the ordinary course of business consistent with past
business practice or (ii) in connection with the transactions contemplated by
this Agreement.
(g) There is no existing, pending or, to the knowledge of
Premiere, threatened event, change or occurrence which could have a Material
Adverse Effect on Premiere except as expressly disclosed in a Premiere SEC
Report or as disclosed in the Premiere Disclosure Memorandum.
(h) This Agreement, and all other documents and information
furnished to WorldCom by Premiere pursuant hereto do not and will not include
any untrue statement of a material fact or omit to state any material fact
necessary to make the statements made and to be made not misleading.
6.2 Representations and Warranties of WorldCom. WorldCom hereby
------------------------------------------
represents and warrants to Premiere as follows:
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(a) WorldCom is a corporation duly organized, validly existing
and in good standing under the laws of the State of Georgia. WorldCom has all
requisite corporate power and authority to execute and deliver this Agreement
and to perform its terms.
(b) The execution and delivery of this Agreement and the
consummation of the transactions contemplated herein, have been duly and validly
authorized by all necessary corporate action in respect thereof on the part of
WorldCom. This Agreement has been duly and validly executed by WorldCom and,
assuming this Agreement constitutes a valid and binding agreement of Premiere,
represents a valid and binding obligation of WorldCom, enforceable in accordance
with its terms subject to the Bankruptcy Exception. The execution, delivery and
performance of this Agreement, and the consummation of the transactions
contemplated hereby, will not conflict with or constitute a breach, violation or
default, or create a Lien, under the Articles of Incorporation or Bylaws of
WorldCom or any Law or any judgment, decree, governmental permit or license or
permit, indenture, agreement or instrument of WorldCom or to which WorldCom is
subject.
(c) WorldCom Network Services, Inc., a wholly-owned subsidiary of
WorldCom, owns good and marketable title to the WorldCom Assets free and clear
of all Liens, and has the power and authority to transfer such Assets to
Premiere pursuant hereto.
(d) This Agreement, and all other documents and information
furnished to Premiere by WorldCom pursuant hereto do not and will not include
any untrue statement of a material fact or omit to state any material fact
necessary to make the statements made and to be made not misleading.
ARTICLE 7
INDEMNIFICATION
---------------
7.1 Agreement of Indemnitors to Indemnify.
-------------------------------------
(a) Subject to the terms and conditions of this Article 7,
Premiere agrees to indemnify, defend, and hold harmless the WorldCom
Indemnitees, and each of them, from, against, for and in respect of any and all
Losses asserted against, or paid, suffered or incurred by, a WorldCom Indemnitee
and resulting from, based upon, or arising out of:
(i) the inaccuracy, untruth, incompleteness or breach of
any representation or warranty of any Premiere Company contained in or made
pursuant to this Agreement, any Related Agreement or in any certificate,
Schedule, or Exhibit furnished to WorldCom pursuant hereto or thereto;
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(ii) a breach of or failure to perform any covenant or
agreement of a Premiere Company made in this Agreement or any Related
Agreement; or
(iii) any Third Party Claim of patent infringement, copyright
infringement, contributory infringement or inducing infringement resulting
from the manufacture, use, sale, importation or licensing of the Platform
Services or of any other product or service provided by a Premiere Company
under or in connection with a Related Agreement.
(b) Subject to the terms and conditions of this Article 7,
WorldCom agrees to indemnify, defend, and hold harmless the Premiere
Indemnitees, and each of them, from, against, for and in respect of any and all
Losses asserted against, or paid, suffered or incurred by, a Premiere Indemnitee
and resulting from, based upon, or arising out of:
(i) the inaccuracy, untruth, incompleteness or breach of
any representation or warranty of any WorldCom Company contained in or made
pursuant to this Agreement, any Related Agreement or in any certificate,
Schedule, or Exhibit furnished to Premiere pursuant hereto or thereto;
(ii) a breach of or failure to perform any covenant or
agreement of a WorldCom Company made in this Agreement or any Related
Agreement;
(iii) any Third Party Claim of patent infringement,
copyright infringement, contributory infringement or inducing infringement
resulting from the manufacture, use, sale, importation or licensing of any
product or service provided by WorldCom under or in connection with a
Related Agreement; or
(iv) any Third Party Claim relating to the purchase by
Premiere of the Conetco Receivable except to the extent the same solely
results from, is based upon or arises out of an act or omission of a
Premiere Company.
7.2 Limitations on Indemnification. No Party shall be liable
------------------------------
hereunder for any special, incidental, indirect or consequential damages
of any Indemnitee.
7.3 Procedures for Indemnification.
------------------------------
(a) An Indemnification Claim shall be made by an Indemnitee by
delivery of a written notice to the Indemnitor requesting indemnification and
specifying the basis on which indemnification is sought and the amount of
asserted Losses, if known, and, in the case of a Third Party Claim, containing
(by attachment or otherwise) such other relevant information as such Indemnitee
shall have concerning such Third Party Claim.
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(b) If the Indemnification Claim involves a Third Party Claim the
procedures set forth in Section 7.4 shall be observed by the Indemnitee and the
Indemnitor.
(c) If the Indemnification Claim involves a matter other than a
Third Party Claim, the Indemnitor shall have 30 days to object to such
Indemnification Claim by delivery of a written notice of such objection to such
Indemnitee specifying in reasonable detail the basis for such objection. Failure
to timely so object shall constitute a final and binding acceptance of the
Indemnification Claim by the Indemnitor, and the Indemnification Claim shall be
paid in accordance with subsection (d) hereof. If an objection is timely
interposed by the Indemnitor and the dispute is not resolved by such Indemnitee
and the Indemnitor within 30 days from the date the Indemnitee receives such
objection, such dispute shall be resolved as provided in Article 8.
(d) Upon determination of the amount of an Indemnification Claim,
whether by agreement between the Indemnitor and the Indemnitee or by an
arbitration award or by any other final adjudication, the obligation of the
Indemnitor shall be immediately satisfied through payment to the appropriate
Indemnitee.
7.4 Third Party Claims. The obligations and liabilities of the
------------------
parties hereunder with respect to a Third Party Claim shall be subject to the
following terms and conditions:
(a) The Indemnitee shall give the Indemnitor written notice of a
Third Party Claim promptly after receipt by the Indemnitee of notice thereof,
and the Indemnitor, may undertake the defense, compromise and settlement thereof
by representatives of its own choosing reasonably acceptable to the Indemnitee.
The failure of the Indemnitee to notify the Indemnitor of such claim shall not
relieve the Indemnitor of any liability that it may have with respect to such
claim except to the extent the Indemnitor demonstrates that the defense of such
claim is prejudiced by such failure. The assumption of the defense, compromise
and settlement of any such Third Party Claim by the Indemnitor shall be an
acknowledgment of the obligation of the Indemnitors to indemnify the Indemnitee
with respect to such claim hereunder. If the Indemnitee desires to participate
in, but not control, any such defense, compromise and settlement, it may do so
at its sole cost and expense. If, however, the Indemnitor fails or refuses to
undertake the defense of such Third Party Claim within thirty (30) days after
written notice of such claim has been given to the Indemnitor by the Indemnitee
(or such shorter period if necessary to avoid prejudice to the defense of such
Third Party Claim), the Indemnitee shall have the right to undertake the
defense, compromise and settlement of such claim with counsel of its own
choosing.
(b) No settlement of a Third Party Claim involving the asserted
liability of the Indemnitors under this Article shall be made without the prior
written consent by or on behalf of the Indemnitor which consent shall not be
unreasonably withheld or delayed. If the Indemnitor assumes the defense of such
a Third Party Claim, (i) no compromise or settlement thereof may be effected by
the Indemnitor without the Indemnitee's consent,
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which consent shall not be unreasonably withheld or delayed (it being understood
that such consent must be given if (1) there is no finding or admission of any
violation of Law or any violation of the rights of any person and no effect on
any other claim that may be made by or against the Indemnitee, (2) the sole
relief provided is monetary damages that are paid in full by the Indemnitors,
and (3) the compromise or settlement includes, as an unconditional term thereof,
the giving by the claimant or the plaintiff to the Indemnitee of a release, in
form and substance satisfactory to the Indemnitee, from all liability in respect
of such Third Party Claim), and (ii) the Indemnitee shall have no liability with
respect to any compromise or settlement thereof effected without its consent.
(c) In connection with the defense, compromise or settlement of
any Third Party Claim, the Parties to this Agreement shall permit participation
of counsel selected by any party hereto and, as may reasonably be related to any
such claim or action, shall provide access, without any cost or any unnecessary
burden on any Indemnitee, to the counsel, accountants and other representatives
of each party and during normal business hours, to all relevant properties,
personnel, books, tax records, contracts, commitments and all other relevant
business records of such other party and will furnish to such other party copies
of all such documents as may reasonably be requested (certified, if requested).
7.5 Other Rights and Remedies Not Affected. The representations and
--------------------------------------
warranties and covenants and agreements of the Parties contained herein shall
survive the execution, delivery and performance of this Agreement. The rights of
the Indemnitees under this Article 7 (in their capacity as Indemnitees or in any
other capacity) with respect to breaches of representations, warranties,
covenants and agreements contained in this Agreement and the Related Agreements
are independent of and in addition to such rights and remedies as the
Indemnitees may have at law or in equity or otherwise, including without
limitation the right to seek specific performance, rescission or restitution,
none of which rights or remedies shall be affected or diminished hereby.
7.6 Tax Effect and Insurance. The liability of the Indemnitors with
------------------------
respect to any Indemnification Claim shall be reduced by the tax benefit
actually realized and any insurance proceeds received by the Indemnitees as a
result of any Losses upon which such Indemnification Claim is based, and shall
include any tax detriment actually suffered by the Indemnitees as a result of
such Losses. The amount of any such tax benefit or detriment shall be
determined by taking into account the effect, if any and to the extent
determinable, of timing differences resulting from the acceleration or deferral
of items of gain or loss resulting from such Losses and shall otherwise be
determined so that payment by the Indemnitors of the Indemnification Claim, as
adjusted to give effect to any such tax benefit or detriment, will make the
Indemnitee as economically whole as is reasonably practical with respect to the
Losses upon which the Indemnification Claim is based. Any dispute as to the
amount of such tax benefit or detriment shall be resolved pursuant to the
provisions of Article 8.
- 11 -
<PAGE>
7.7 Subrogation. Upon payment in full of any Indemnification Claim,
-----------
whether such payment is effected by set-off or otherwise, or the payment of any
judgment or settlement with respect to a Third Party Claim, the Indemnitor shall
be subrogated to the extent of such payment to the rights of the Indemnitee
against any person or entity with respect to the subject matter of such
Indemnification Claim or Third Party Claim.
ARTICLE 8
DISPUTE RESOLUTION
------------------
8.1 Informal Dispute Resolution. Prior to the initiation of formal
---------------------------
dispute resolution procedures, the Parties shall first attempt to resolve their
dispute informally, as follows:
(a) The Premiere Representatives and WorldCom Representatives
shall meet for the purpose of endeavoring to resolve such dispute. The
Representatives shall meet as often as the Parties reasonably deem necessary in
order to gather and furnish to the other all information with respect to the
matter in issue which the Parties believe to be appropriate and germane in
connection with its resolution. The Representatives shall discuss the problem
and negotiate in good faith in an effort to resolve the dispute without the
necessity of any formal proceeding. During the course of negotiations, all
reasonable requests made by one Party to another for nonprivileged information,
reasonably related to this Agreement, shall be honored in order that each of the
Parties may be fully advised of the other's position. The specific format for
the discussions shall be left to the discretion of the Representatives, but may
include the preparation of agreed-upon statements of fact or written statements
of position.
(b) If the Representatives conclude in good faith that amicable
resolution through continued negotiation in this form does not appear likely,
the matter will be escalated by formal written notification to a joint panel of
Premiere and WorldCom senior officers. This panel will meet as required to
attempt to resolve the dispute. The number and nature of the senior officers
will depend on the issues in dispute, but will include those senior officers
with authority to resolve all matters in dispute. At either Party's election
this panel will be facilitated by an external facilitator designated by both
Parties.
(c) Formal proceedings for the resolution of a dispute may not be
commenced until the earlier of:
(i) the panel referred to in Subsection 8(b) above
concluding in good faith that amicable resolution through continued
negotiation of the matter does not appear likely; or
(ii) thirty (30) days after the initial request to negotiate
the dispute. This provision shall not be construed to prevent a Party from
instituting,
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<PAGE>
and a Party is authorized to institute, formal proceedings earlier to avoid
the expiration of any applicable limitations period, or to preserve a
superior position with respect to other creditors, or as provided in
Sections 8.5 and 10.2
8.2 Arbitration. If the Parties are unable to resolve any
-----------
controversy arising under this Agreement as contemplated by Section 8.1 and if
such controversy is not subject to Sections 8.3 or 8.5 of this Agreement, then
such controversy shall be submitted to mandatory and binding arbitration at the
election of either Party (the "Disputing Party") pursuant to the following
conditions:
(a) The Disputing Party shall notify the American Arbitration
Association and the other Party in writing describing in reasonable detail the
nature of the dispute (the "Dispute Notice"), and shall request that the
American Arbitration Association furnish a list of five (5) possible arbitrators
who shall have at least five (5) years experience in the matter in dispute.
Each of the Parties will select one of these arbitrators and the Parties shall
jointly select the third arbitrator from the proposed list.
(b) The arbitrators shall allow reasonable discovery in the forms
permitted by the Federal Rules of Civil Procedure, to the extent consistent with
the purpose of the arbitration. The arbitrators shall have no power or
authority to amend or disregard any provision of this Section 8.2. The
arbitration hearing shall be commenced promptly and conducted expeditiously,
with each of the Parties being allocated one-half of the time for the
presentation of its case. Unless otherwise agreed to by the Parties, an
arbitration hearing shall be conducted on consecutive days.
(c) Should one or more of the arbitrators refuse or be unable to
proceed with arbitration proceedings as called for by this Section 8.2, such
arbitrator(s) shall be replaced by an arbitrator(s) by the Party or Parties, as
appropriate, who originally selected such arbitrator(s). If an arbitrator is
replaced pursuant to this paragraph (c), then a rehearing shall take place in
accordance with the provisions of this Section 8.2.
(d) The arbitrators rendering judgment upon disputes between
Parties as provided in this Section 8.2 shall, after reaching judgment and
award, prepare and distribute to the Parties a writing describing the findings
of fact and conclusions of law relevant to such judgment and award and
containing an opinion setting forth the reasons for the giving or denial of any
award. The award of the arbitrator shall be final and binding on the Parties,
and judgment thereon may be entered in a court of competent jurisdiction.
(e) Arbitration hearings hereunder shall be held in Atlanta,
Georgia if WorldCom is the Disputing Party or in Jackson, Mississippi if
Premiere is the Disputing Party. If the Parties agree, arbitration hearings may
be held in another location.
(f) The arbitrators are instructed that time is of the essence in
the arbitration proceeding, and that the arbitrators shall have the right and
authority to issue
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<PAGE>
monetary sanctions against either of the Parties if, upon a showing of good
cause, that Party is unreasonably delaying the proceeding. The arbitrators shall
render their judgment or award within fifteen (15) days following the conclusion
of the hearing. Recognizing the express desire of the Parties for an expeditious
means of dispute resolution, the arbitrators shall limit or allow the Parties to
expand the scope of discovery as may be reasonable under the circumstances.
8.3 Litigation. The Parties agree that all disputes between them
----------
shall be subject to the provisions of Sections 8.1 and 8.2 except as set forth
in Section 8.5, and except where a Party makes a good faith determination that a
breach by the other Party is such that the damages to such Party resulting from
the breach will be so immediate, so large or severe, and so incapable of
adequate redress after the fact that a temporary restraining order or other
immediate injunctive relief is a necessary remedy.
8.4 Continued Performance. Each Party agrees to continue performing
---------------------
its obligations under this Agreement while any dispute is being resolved unless
and until such obligations are terminated by the termination or expiration of
this Agreement.
8.5 Equitable Remedies. The Parties acknowledge that, in the event
------------------
that the other breaches (or attempts or threatens to breach) its obligations
under Section 10.2, or of the obligations of WorldCom under Sections 3.1, 4.7 or
4.8 of the Investment Agreement, the other Party will be irrevocably harmed. In
such circumstance, the non-breaching party may proceed directly to court. If a
court of competent jurisdiction should find that the other party has breached
(or attempted or threatened to breach) any of such obligations, the breaching
Party agrees that it will not oppose the entry of an appropriate order
compelling the performance of such Party in restraining it from further breaches
(or attempted or threatened breaches) on the grounds that the failure to abide
by such obligations will not cause the other Party irreparable harm.
ARTICLE 9
TERM AND TERMINATION
--------------------
9.1 Term. Unless earlier terminated pursuant to the provisions of
----
Section 9.2, the term of this Agreement shall commence on the date hereof and
shall continue until the twenty-fifth (25th) anniversary of such date (the
"Initial Term"), and shall continue thereafter for successive five year terms
(each, a "Renewal Term") unless, no later than 180 days, nor earlier than 360
days, prior to the end of the Initial Term or Renewal Term, as the case may be,
one of the Parties gives notice to the other Party that it desires to terminate
the Agreement.
9.2 Termination. This Agreement may be terminated prior to the end
-----------
of the Initial Term or applicable Renewal Term:
(a) By mutual consent of the Parties;
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<PAGE>
(b) By either Party in the event of a material breach by the
other Party of any material representation, covenant or agreement contained in
this Agreement which has not been cured within 60 days after the receipt of
written notice by the breaching Party of such breach; provided, however, that if
such breach is capable of cure but not within such 60 day period, the Party
asserting the right of termination may not terminate this Agreement if and so
long as the breaching Party has taken steps in good faith during such 60 day
period to cure such breach and thereafter diligently pursues cure to completion;
or
(c) Upon the termination of all Related Agreements by either
Party due to a material breach thereof in accordance with the termination
provisions thereof by the other Party, at the election of the Party terminating
the Platform Services Agreement and all Related Agreements.
9.3 Effect of Termination. In the event of the termination of this
---------------------
Agreement pursuant to Section 9.2, this Agreement shall become void, except that
(a) the provisions of this Section 9.3 and Articles 7 and 10 shall survive any
such termination, (b) a termination pursuant to Section 9.2(b) shall not relieve
the breaching Party from Liability for an uncured breach of this Agreement, and
(c) a termination of this Agreement shall not affect the rights and obligations
of the Parties under any Related Agreement unless so provided therein (which
shall remain in effect and be governed by its terms, until terminated in
accordance therewith).
ARTICLE 10
MISCELLANEOUS
-------------
10.1 Definitions.
-----------
(a) Except as otherwise provided herein, the capitalized terms
set forth below shall have the following meanings:
"Affiliate" of a Person shall mean: (i) any other Person
directly, or indirectly through one or more intermediaries, controlling,
controlled by or under common control with such Person; or (ii) any
executive officer, director, general partner, or direct or indirect
beneficial owner of any 10% or greater equity or voting interest of such
Person or a Subsidiary thereof.
"Aggregate Operating Income" shall mean the sum of all Operating
Income received by any Premiere Company from (a) any Platform Services
Agreement entered into pursuant to Article 3 or pursuant to a Joint
Marketing Agreement entered into pursuant to Article 4 and (b) any Joint
Marketing Agreement entered into pursuant to Article 4. For purposes of
this definition, "Operating Income" shall mean (i) service charges and
other amounts (but not late fees) received by the relevant Premiere Company
under a Platform Services Agreement entered into pursuant to Article 3 or
pursuant to a Joint Marketing
- 15 -
<PAGE>
Agreement entered into pursuant to Article 4, and (ii) all other revenue
allocated to a Premiere Company under a Joint Marketing Agreement,
including any marketing commissions or Premiere's allocation of offering
revenues (not including any service charges or other amounts received by a
Premiere Company and included in the amounts included in the preceding
clause (i)).
"Agreement" shall mean this Strategic Relationship Agreement,
including the Exhibits and Schedules delivered pursuant hereto and
incorporated herein by reference.
"Bankruptcy Exception" shall mean all applicable bankruptcy,
insolvency and similar laws affecting creditors' rights generally.
"Conetco" shall mean Conetco Corporation, a New York corporation
d/b/a Communications Network Corporation.
"Conetco Bankruptcy Action" shall mean the action styled In Re
-----
Communications Network Corporation, a/k/a Conetco pending in the United
-------------------------------------------------
States Bankruptcy Court for the Southern District of New York (Case No. 96-
B-43504).
"Conetco Receivable" shall mean the amounts due any WorldCom
Company from the claims asserted against Conetco in the Conetco Bankruptcy
Action and from the claims asserted against the Khatibs in the Khatib
Guaranty Action, or any claim or claims asserted in any other action
arising out of or based on the subject matter of the Conetco Bankruptcy
Action or the Khatib Guaranty.
"Confidentiality Agreements" shall mean the Confidentiality
Agreements of Premiere and WorldCom delivered on September 5, 1996 for the
respective benefit of the other Party.
"EBIS Stock" shall mean the 950 shares of common stock of EBIS
Communications, Inc., a Georgia corporation, owned by WorldCom Network
Services, Inc., a Delaware corporation and wholly owned subsidiary of
WorldCom.
"Enhanced Calling Programs" shall mean (a) all prepaid (or debit)
card programs and other calling card programs offered from time to time by
the WorldCom Companies, and (b) other enhanced calling program, in addition
to calling card programs, offered from time to time by the WorldCom
Companies pursuant to which a caller dials a number and interacts with a
computer based instrument requiring a database lookup, call routing, or
message forwarding, including by way of example and not limitation, 1-800-
PIN programs, various interactive voice applications, and other special
applications involving network based computer telephony, including, but not
limited to, the types of services in development as set forth in the
Premiere Disclosure Memorandum..
- 16 -
<PAGE>
"Exhibits" A through C, inclusive, shall mean the Exhibits so
marked, copies of which are attached to this Agreement. Such Exhibits are
hereby incorporated by reference herein and made a part hereof, and may be
referred to in this Agreement and any other related instrument or document
without being attached hereto.
"GAAP" shall mean generally accepted accounting principles,
consistently applied during the periods involved.
"Indemnification Claim" shall mean a claim for indemnification
under Article 7.
"Indemnitee" shall mean a Premiere Indemnitee or a WorldCom
Indemnitee, as the case may be.
"Indemnitor shall mean Premiere or WorldCom, as the case may be.
"Khatibs" shall mean Wael Al-Khatib, Prudence Al-Khatib and the
other defendants in the Khatib Guaranty Action.
"Khatib Guaranty Action" shall mean the action styled WorldCom
--------
Network Services, Inc. f/k/a Wiltel, Inc. v. Wael-Al-Khatib, et. al.
--------------------------------------------------------------------
pending in the United States District Court for the Southern District of
New York (Civil Action No. 96-4492).
"Law" shall mean any code, law (including common law), ordinance,
regulation, reporting or licensing requirement, rule, or statute applicable
to a Person or its assets, Liabilities, or business, including those
promulgated, interpreted or enforced by any regulatory authority.
"Liability" shall mean any direct or indirect, primary or
secondary, liability, indebtedness, obligation, penalty, cost or expense
(including costs of investigation, collection and defense), claim,
deficiency, guaranty or endorsement of or by any Person (other than
endorsements of notes, bills, checks, and drafts presented for collection
or deposit in the ordinary course of business) of any type, whether
accrued, absolute or contingent, liquidated or unliquidated, matured or
unmatured, or otherwise.
"Lien" shall mean any conditional sale agreement, default of
title, easement, encroachment, encumbrance, hypothecation, infringement,
lien, mortgage, pledge, reservation, restriction, security interest, title
retention or other security arrangement, or any adverse right or interest,
charge, or claim of any nature whatsoever of, on, or with respect to any
property or property interest, other than (i) Liens for current property
taxes not yet due and payable, and
- 17 -
<PAGE>
(iii) Liens which do not materially impair the use of or title to the
assets subject to such Lien.
"Litigation" shall mean any action, arbitration, cause of action,
claim, complaint, criminal prosecution, governmental or other examination
or investigation, hearing, administrative or other proceeding relating to
or affecting a Party, its business, its assets (including contracts related
to it), or the transactions contemplated by this Agreement.
"Losses" shall mean any and all demands, claims, actions or
causes of action, assessments, losses, diminution in value, damages,
liabilities, costs, and expenses, including interest, penalties, cost of
investigation and defense, and reasonable attorneys' and other professional
fees and expenses.
"Material Adverse Effect" on a Party shall mean an event, change
or occurrence which, individually or together with any other event, change
or occurrence, has a material adverse impact on (i) the financial position,
business, results of operations or prospects of such Party and its
Subsidiaries, taken as a whole, or (ii) the ability of such Party to
perform its obligations under this Agreement or to consummate the
Acquisition or the other transactions contemplated by this Agreement,
provided that "Material Adverse Effect" shall not be deemed to include the
impact of (a) changes in Laws of general applicability or interpretations
thereof by courts or governmental authorities, (b) changes in generally
accepted accounting principles or regulatory accounting principles, and (c)
actions and omissions of a Party (or any of its Subsidiaries) taken with
the prior informed written consent of the other Party in contemplation of
the transactions contemplated hereby.
"Material" for purposes of this Agreement shall be determined in
light of the facts and circumstances of the matter in question; provided
that any specific monetary amount stated in this Agreement shall determine
materiality in that instance.
"Net Proceeds" shall mean the difference between (a) the
aggregate amount of cash and fair market value of any property other than
cash received by any WorldCom Company in payment of the Conetco Receivable,
whether those amounts are received from Conetco, the Khatibs or any other
Person, and (b) the amount of expenses, including attorneys' fees,
reasonably incurred by any WorldCom Company in connection with the
collection of the Conetco Receivable.
"Person" shall mean a natural person or any legal, commercial or
governmental entity, such as, but not limited to, a corporation, general
partnership, joint venture, limited partnership, limited liability company,
trust, business association, group acting in concert, or any person acting
in a representative capacity.
- 18 -
<PAGE>
"Platform Services" shall mean the computer telephony platform
services offered by the Premiere Companies as described on Exhibit A of the
Platform Services Agreement attached hereto as Exhibit C, and such other
---------
such services as may be developed and offered from time to time by the
Premiere Companies, including services developed pursuant to this
Agreement.
"Premiere Common Stock" shall mean the $.01 par value common
stock of Premiere.
"Premiere Companies" shall mean, collectively, Premiere and all
Premiere Subsidiaries, whether now existing or hereafter acquired or
formed.
"Premiere Disclosure Memorandum" shall mean the written
information entitled "Premiere Technologies, Inc. Disclosure Memorandum"
delivered on the date of this Agreement to WorldCom describing in
reasonable detail the matters contained therein and, with respect to each
disclosure made therein, specifically referencing each Section of this
Agreement under which such disclosure is being made. Information disclosed
with respect to one Section shall not be deemed to be disclosed for
purposes of any other Section not specifically referenced with respect
thereto.
"Premiere Indemnitees" shall mean any Premiere Company and their
respective officers, directors, agents and other representatives.
"Premiere Representatives" shall mean the representatives of
Premiere on the Strategic Alliance Committee, which shall at a minimum
include D. Gregory Smith so long as he is an employee of any Premiere
Company or until Premiere designates a successor representative.
=======================================================
"Premiere Subsidiaries" shall mean the Subsidiaries of Premiere.
"Related Agreements" shall mean the Investment Agreement, the
Assignment Agreement, the Irrevocable Stock Power, Platform Services
Agreements entered into pursuant to Articles 3 and 4 hereof, and any Joint
Marketing Agreements entered into (including, in each case, any amendments
thereto and replacements or successor agreements thereto).
"Representatives" shall mean the Premiere Representatives and the
WorldCom Representatives.
"SEC Documents" shall mean all forms, proxy statements,
registration statements, reports, schedules, and other documents filed, or
required to be filed, by a Party or any of its Subsidiaries pursuant to the
Securities Laws, together with any amendments thereto.
"Securities Laws" shall mean the Securities Act of 1933, as
amended, the Securities Exchange Act of 1934, as amended, the Investment
Company Act of
- 19 -
<PAGE>
1940, as amended, the Investment Advisors Act of 1940, as amended, the
Trust Indenture Act of 1939, as amended, and the rules and regulations
promulgated thereunder.
"Strategic Alliance Committee" or "Committee" shall mean the
Committee comprised of the WorldCom Representatives and the Premiere
Representatives to administer various aspects of the strategic alliance
between WorldCom and Premiere as set forth in this Agreement.
"Subsidiaries" shall mean all those corporations, associations,
limited liability companies, partnerships, business trusts or other
business entities of which the entity in question at the time in question
either (i) owns or controls 50% or more of the outstanding equity
securities either directly or through an unbroken chain of entities as to
each of which 50% or more of the outstanding equity securities is owned
directly or indirectly by its parent, (ii) in the case of partnerships,
serves as a general partner, (iii) in the case of a limited liability
company, serves as a managing member, or (iv) otherwise has the ability to
elect a majority of the directors, trustees or managing members thereof.
"Third Party Claim" shall mean any Litigation that is instituted
against an Indemnitee by a person or entity other than an Indemnitor and
which, if prosecuted successfully, would result in a Loss for which the
Indemnitee is entitled to indemnification under Article 7.
"WorldCom Assets" shall mean all right, title and interest of
WorldCom and its Subsidiaries in and to (a) the EBIS Stock and (b) Fifty
Million Dollars ($50,000,000) of the Net Proceeds of the Conetco
Receivable, payable to the extent of fifty percent (50%) of the Net
Proceeds from the Conetco Receivable.
"WorldCom Companies" shall mean, collectively, WorldCom and all
WorldCom Subsidiaries, whether now existing or hereafter acquired or
formed.
"WorldCom Indemnitees" shall mean any WorldCom Company and their
respective officers, directors, agents and other representatives.
"WorldCom Representatives" shall mean the representatives of
WorldCom on the Strategic Alliance Committee, which at a minimum shall
include Frank Grillo so long as he is an employee of any WorldCom
Company or until WorldCom designates a successor representative.
=======================================================
"WorldCom Subsidiaries" shall mean the Subsidiaries of WorldCom.
(b) The terms set forth below shall have the meanings ascribed
thereto in the referenced sections:
Base Month Section 5.1
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<PAGE>
Conflicting Platform Services Agreements Section 3.2
Dispute Notice Section 8.2
Disputing Party Section 8.2
Joint Marketing Agreements Section 4.2
Joint Service Offerings Section 4.1
Late Payment Charge Section 5.2
Monthly Deficiency Payment Section 5.1
Minimum Guarantee Period Section 5.1
Premiere SEC Reports Section 6.1
Special Services Section 3.3
(c) Any singular term in this Agreement shall be deemed to
include the plural, and any plural term the singular. Whenever the words
"include," "includes" or "including" are used in this Agreement, they shall be
deemed followed by the words "without limitation."
10.2 Confidentiality. All information furnished by the Parties in
---------------
contemplation of or pursuant to this Agreement or the Related Agreements shall
be treated as the sole property of the Party providing such information. The
Party receiving the information shall keep confidential all such information and
shall not directly or indirectly use such information for any competing or other
commercial purpose. The obligation to keep confidential and not use such
information shall not apply to (a) any information which (i) the Party receiving
the information was already in possession of prior to disclosure thereof by the
Party furnishing the information, (ii) was then available to the public, or
(iii) became available to the public through no fault of the Party receiving the
information, or (b) discloses pursuant to a legal requirement or in accordance
with an order of a court of competent jurisdiction or regulatory agency and
shall cooperate with the other Party in seeking a protective order or other
appropriate remedy or action; provided that the Party which is subject to such
legal requirement or order shall use its best efforts to give the other Party at
least ten (10) business days' notice thereof. Each Party acknowledges and
agrees that a breach of their respective obligations of this Section 10.2 would
cause the other irreparable harm for which there is no adequate remedy at law
and that accordingly each is entitled to injunctive and other equitable relief
for the enforcement thereof in addition to damages or any other relief available
at law.
10.3 Expenses. Except as may be provided in this Agreement or in a
--------
Related Agreement, each of the Parties shall bear and pay all direct costs and
expenses incurred by it or on its behalf in connection with the transactions
contemplated hereunder.
10.4 Brokers and Finders. Each of the Parties represents and
-------------------
warrants that neither it nor any of its officers, directors, employees, or
Affiliates has employed any broker or finder or incurred any Liability for any
financial advisory fees, investment bankers' fees, brokerage fees, commissions,
or finders' fees in connection with this Agreement or the transactions
contemplated hereby. In the event of a claim by any broker or finder based upon
his or its representing or being retained by or allegedly representing
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<PAGE>
or being retained by WorldCom or Premiere, each of WorldCom and Premiere, as the
case may be, agrees to indemnify and hold the other Party harmless of and from
any Liability in respect of any such claim.
10.5 Entire Agreement. Except as otherwise expressly provided
----------------
herein, this Agreement (including the documents and instruments referred to
herein) constitutes the entire agreement between the Parties with respect to the
transactions contemplated hereunder and supersedes all prior arrangements or
understandings with respect thereto, written or oral (except for the
Confidentiality Agreements). Nothing in this Agreement expressed or implied, is
intended to confer upon any Person, other than the Parties, an Indemnitee or
their respective successors or permitted assigns, any rights, remedies,
obligations, or liabilities under or by reason of this Agreement.
10.6 Notices. Any notices or other communications required or
-------
permitted under this Agreement shall be effective only if it is in writing and
delivered personally, by facsimile transmission by nationally recognized next
business day courier, or by registered or certified mail, postage pre-paid,
addressed as follows:
Premiere: Premiere Technologies, Inc.
3399 Peachtree Road, N.E.
The Lenox Building, Suite 400
Atlanta, Georgia 30326
Telecopy No.: (404) 262-8540
Attention: Boland T. Jones
President
and
Patrick G. Jones
Senior Vice President of Finance and
Legal
Copy to Counsel: Alston & Bird
One Atlantic Center
1201 West Peachtree Street
Atlanta, Georgia 30309-3424
Telecopy No.: (404) 881-7777
Attention: Jeffrey A. Allred, Esq.
WorldCom: WorldCom, Inc.
515 East Amite Street
Jackson, Mississippi 39201-2702
Telecopy No.: (601) 360-8190
Attention: David F. Myers
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<PAGE>
Copy to Counsel: P. Bruce Borghardt
WorldCom, Inc.
10777 Sunset Office Drive, Suite 330
St. Louis, Missouri 63127
Telecopy No.: (314) 909-4101
or such other address as shall be furnished in writing by any of the Parties.
Any such notice or communication shall be deemed to have been given as of the
date so personally delivered, sent by courier or facsimile or mailed.
10.7 Amendments. This Agreement may be amended by a subsequent
----------
writing signed by both Parties upon the approval of each of the Parties.
10.8 Counterparts; Facsimile. This Agreement may be executed in two
-----------------------
or more counterparts all of which shall be one and the same Agreement and shall
become effective when one or more counterparts have been signed by each Party
and delivered to the other Party. Delivery of a signature page by facsimile
transmission shall be deemed to be legally sufficient execution and delivery of
the page and the agreement or instrument for which it relates.
10.9 Headings. The headings in this Agreement are for convenience
--------
only and shall not affect the construction or interpretation of this Agreement.
10.10 Successors and Assigns. All terms and conditions of this
----------------------
Agreement shall be binding upon and inure to the benefit of and be enforceable
by any successor to WorldCom and any successor to Premiere. Except as otherwise
provided in this Section 10.10, any assignment of the rights and obligations of
the Parties under this Agreement shall be effective upon a written agreement
signed by all the Parties.
10.11 Severability. If any provision of this Agreement shall be held
------------
to be illegal, invalid or unenforceable, such illegality, invalidity or
unenforceability shall attach only to such provision and shall not in any manner
affect or render illegal, invalid or unenforceable any other provision of this
Agreement, and this Agreement shall be carried out as if any such illegal,
invalid or unenforceable provision were not contained herein. If any provision
of this Agreement is so broad as to be unenforceable, the provision shall be
interpreted to be only so broad as is enforceable.
10.12 Interpretations. The Parties acknowledge and agree that this
---------------
Agreement has been reviewed, negotiated and accepted by all Parties and their
attorneys and shall be construed and interpreted according to the ordinary
meaning of the words used so as fairly to accomplish the purposes and intentions
of all Parties hereto.
10.13 Attorneys' Fees. In the event of any action to enforce this
---------------
Agreement, the prevailing Party shall be entitled to reimbursement from the
other Party of all costs and
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<PAGE>
expenses incurred in connection with such effort, including court costs and
reasonable attorneys' fees.
10.14 Relationship of the Parties. Each of the Parties acknowledge
---------------------------
that they are acting as independent contractors, and each Party has the sole
right and obligation to supervise, manage, contract, direct, procure, perform or
cause to be performed, all work or other obligations to be performed by such
Party under this Agreement. Neither Party is an agent of the other Party, nor
has the authority to represent or otherwise bind the other Party as to any
matters.
10.15 Publicity. All media releases, public announcements and public
---------
disclosure by either Party related to this Agreement or the subject matter of
this Agreement, including, without limitation, promotional or marketing
material, shall be coordinated and approved by the other Party prior to release;
provided that nothing herein shall preclude a Party from complying with its
obligations under applicable Law. Notwithstanding the foregoing, Premiere may
list WorldCom as a customer in proposals and other marketing materials.
10.16 Service Marks. Except as set forth in Section 10.15, each Party
-------------
agrees that it shall not, without the other Party's prior written consent, use
the name, service marks or trademarks of the other Party.
10.17 Covenant of Good Faith. Each Party agrees that, in its
----------------------
respective dealings with the other Party under or in connection with this
Agreement, it shall act in good faith.
10.18 Force Majeure. Each Party shall be excused from performance
-------------
under this Agreement and shall have no liability to the other Party for any
period it is prevented from performing any of its obligations (other than
payment obligations), in whole or in part, as a result of delays caused by the
other Party or by an act of God, war, civil disturbance, court order, labor
dispute, third party performance or nonperformance, or other cause beyond its
reasonable control, including failures or fluctuations in electrical power, heat
or light and such nonperformance shall not be a default under, or grounds for
termination of, this Agreement or, to the extent provided therein, any Related
Agreement.
10.19 Governing Law. This Agreement shall be governed by and
-------------
construed in accordance with the laws of the State of Georgia.
- 24 -
<PAGE>
IN WITNESS WHEREOF, each of the Parties has caused this Agreement to be
duly executed and delivered as of the date above written.
PREMIERE TECHNOLOGIES, INC.
By: /s/ Patrick G. Jones
--------------------------------
Name: Patrick G. Jones
------------------------
Title: Senior Vice President Finance and Legal
---------------------------------------
WORLDCOM, INC.
By: /s/ David F. Myers
--------------------------------
Name: David F. Myers
------------------------
Title: Treasurer
-----------------------
- 25 -
<PAGE>
INVESTMENT AGREEMENT
--------------------
THIS INVESTMENT AGREEMENT (this "Agreement") is made and entered into as
the 13th day of November, 1996, by and between PREMIERE TECHNOLOGIES, INC., a
Georgia corporation ("Premiere"), and WORLDCOM, INC., a Georgia corporation
("WorldCom").
Preamble
--------
On the date of this Agreement, Premiere and WorldCom have entered into a
Strategic Alliance Agreement (the "Strategic Alliance Agreement") pursuant to
which, among other things, Premiere agreed to issue to WorldCom 2,050,000 shares
of Premiere Common Stock. As a condition to the issuance of those shares,
WorldCom agreed to enter into this Agreement. Capitalized terms used but not
defined herein shall have the meanings set forth in the Strategic Alliance
Agreement
NOW, THEREFORE, in consideration of the above and the mutual warranties,
representations, covenants and agreements set forth herein, the parties,
intending to be legally bound, agree as follows:
ARTICLE 1
DEFINITIONS
-----------
As used in this Agreement and any amendments hereto, the following terms
shall have the following meanings respectively:
"Exchange Act" shall mean the Securities Exchange Act of 1934, as amended,
or, if further amended, then as amended and in effect at the time in question.
"Extraordinary Transaction" shall mean the consummation of any tender offer
or exchange offer for Premiere Voting Securities or any merger, acquisition of
all or substantially all of the assets of, or other business combination
involving Premiere.
"Holder" shall mean any holder of Registrable Securities.
"Initiating Holder" shall mean any Holder or Holders who in the aggregate
are Holders of more than 50% of the then outstanding Registrable Securities.
"Other Stockholders" shall have the meaning set forth in Section 4.1.
<PAGE>
"Party" shall mean either Premiere, on the one hand, or WorldCom, on the
other hand, and "Parties" shall mean Premiere and WorldCom.
"Person" shall mean a natural person or any legal, commercial or
governmental entity, such as, but not limited to, a corporation, general
partnership, joint venture, limited partnership, limited liability company,
trust, business association, group acting in concert, or any person acting in a
representative capacity.
"Premiere Common Stock" shall mean the $.01 par value common stock of
Premiere and any security which is exchanged for such common stock.
"Premiere Shares" shall mean the 2,050,000 shares of Premiere Common Stock
to be acquired by WorldCom on the date of this Agreement as specified in the
Strategic Alliance Agreement, and any Premiere Voting Securities received in
exchange or substitution therefor or as a dividend in respect thereof.
"Premiere Voting Securities" shall mean all classes of capital stock of
Premiere which are then entitled to vote generally in the election of directors
and any securities exchanged for such classes of capital stock and any
securities convertible into or exchangeable or exercisable for such classes of
capital stock. For purposes of determining the amount or percentage of
outstanding Premiere Voting Securities beneficially owned by a Person, and for
purposes of calculating the aggregate voting power relating to such Premiere
Voting Securities, securities that are deemed to be outstanding shall be
included to the extent provided in the definition of "Beneficial Owner."
"Priority Holders" shall have the meaning set forth in Section 4.2.
"Register", "Registered" and "Registration" shall mean a registration
effected by preparing and filing a registration statement in compliance with the
Securities Act (and any post-effective amendments filed or required to be filed)
and the declaration or ordering of effectiveness of such registration statement.
"Registrable Securities" shall mean the Premiere Shares, provided that
Registrable Securities shall cease to be Registrable Securities if and when (i)
a registration statement with respect to the disposition of such Registrable
Securities shall have become effective under the Securities Act, (ii) such
Registrable Securities could be sold in any one-day period pursuant to Rule 144
under the Securities Act, (iii) such Registrable Securities shall have been
otherwise transferred, if new certificates or other evidences of ownership for
such Registrable Securities not bearing a legend restricting further transfer
and not subject to any stop transfer order or other restrictions on transfer
shall have been delivered by Premiere and subsequent disposition of such
Registrable Securities shall not require registration or qualification of such
Registrable Securities under the Securities Act, or (iv) such Registrable
Securities shall have ceased to be outstanding.
-2-
<PAGE>
"Registration Expenses" shall mean all expenses incurred by Premiere in
compliance with Article 4 hereof, including, without limitation, all
registration and filing fees, printing expenses, fees and disbursements of
counsel for Premiere, blue sky fees and expenses and the expense of any special
audits incident to or required by any such registration.
"SEC" shall mean the Securities and Exchange Commission, or any successor
agency which has primary authority to interpret and enforce the provisions of
the Securities Act and the Exchange Act.
"Security", "Securities" shall have the meaning set forth in Section 2(1)
of the Securities Act.
"Securities Act" shall mean the Securities Act of 1933, as amended, or, if
further amended, then as amended and in effect at the time in question.
"Selling Expenses" shall mean all underwriting discounts and selling
commissions applicable to the sale of Registrable Securities and all fees and
disbursements of counsel for each of the Holders.
"Strategic Alliance Agreement" shall mean that certain Strategic Alliance
Agreement dated the date hereof between Premiere and WorldCom.
ARTICLE 2
REPRESENTATIONS AND WARRANTIES
------------------------------
2.1 Representations and Warranties of Premiere. In addition to the
------------------------------------------
representations and warranties of Premiere contained in the Strategic Alliance
Agreement, which are incorporated herein by reference, Premiere hereby
represents and warrants to WorldCom as follows:
(a) Premiere is a corporation duly organized, validly existing and in
good standing under the laws of the State of Georgia. Premiere has all
requisite corporate power and authority to execute and deliver this
Agreement and to perform its terms.
(b) The execution and delivery of this Agreement and the consummation
of the transactions contemplated herein, have been duly and validly
authorized by all necessary corporate action in respect thereof on the part
of Premiere. This Agreement has been duly and validly executed by Premiere
and, assuming this Agreement constitutes a valid and binding agreement of
WorldCom, represents a valid and binding obligation of Premiere,
enforceable in accordance with its terms subject to the Bankruptcy
Exception. The execution, delivery and performance of this Agreement, and
the consummation of the transactions
-3-
<PAGE>
contemplated hereby, will not conflict with or constitute a breach,
violation or default, or create a lien, under the Articles of Incorporation
or Bylaws of Premiere or any law, rule or regulation or any judgment,
decree, governmental permit or license or permit, indenture, agreement or
instrument of Premiere or to which Premiere is subject.
2.2 Representations and Warranties of WorldCom. WorldCom hereby
------------------------------------------
represents and warrants to Premiere as follows:
(a) WorldCom is a corporation duly organized, validly existing and
in good standing under the laws of the State of Georgia. WorldCom has all
requisite corporate power and authority to execute and deliver this
Agreement and to perform its terms.
(b) The execution and delivery of this Agreement and the
consummation of the transactions contemplated herein, have been duly and
validly authorized by all necessary corporate action in respect thereof on
the part of WorldCom. This Agreement has been duly and validly executed by
WorldCom and, assuming this Agreement constitutes a valid and binding
agreement of Premiere, represents a valid and binding obligation of
WorldCom, enforceable in accordance with its terms subject to the
Bankruptcy Exception. The execution, delivery and performance of this
Agreement, and the consummation of the transactions contemplated hereby,
will not conflict with or constitute a breach, violation or default, or
create a lien, under the Articles of Incorporation or Bylaws of WorldCom or
any law, rule or regulation or any judgment, decree, governmental permit or
license or permit, indenture, agreement or instrument of WorldCom or to
which WorldCom is subject.
(c) WorldCom acknowledges that (i) the Premiere Shares issued to it
under the Strategic Alliance Agreement have not been registered under the
Securities Act or any applicable state securities laws and may not be
transferred or otherwise disposed of unless so registered or an exemption
from such registration is available, and (ii) Premiere has made no promise
or other commitment regarding the registration of the Premiere Shares or
the taking of any action required for the availability of any exemption
from registration other than as set forth in Article 4 hereof. All of the
Premiere Shares received by WorldCom pursuant to the Strategic Alliance
Agreement have been acquired by WorldCom solely for investment. WorldCom
has no present intention to distribute, sell, assign, transfer or otherwise
dispose of the Premiere Shares. WorldCom understands that an investment in
the Premiere Shares involves a substantial risk and that no representation
has been made to WorldCom regarding the future performance of Premiere or
the future market value of the Premiere Shares.
-4-
<PAGE>
ARTICLE 3
COVENANTS AND AGREEMENTS OF WORLDCOM
------------------------------------
WorldCom hereby covenants and agrees with Premiere as follows:
3.1 Right of First Refusal. Each of WorldCom and its Affiliates, prior to
----------------------
making any sale or other transfer of Premiere Shares to any Person other than
an Affiliate shall give Premiere the opportunity to purchase, or to designate an
alternative purchaser of, such Premiere Shares in the following manner:
(a) The proposed transferor of such Premiere Shares shall give to
Premiere written notice (the "Transfer Notice") of the proposed transfer,
specifying the proposed transferee, the number of Premiere Shares proposed to
be disposed of, the proposed consideration to be received in exchange
therefor, and the other material terms of the proposed transfer.
(b) Premiere shall have the right, exercisable by written notice given
to the Person which gave the Transfer Notice within ten (10) days after
receipt of such Notice, to purchase (or to cause another Person designated by
Premiere to purchase) all, but not less than all, of the Premiere Shares
specified in such Notice for cash at the purchase price set forth therein.
If the consideration specified in the Transfer Notice includes any property
other than cash, such purchase price shall be deemed to be the amount of any
cash included as part of such consideration plus the value (as jointly
determined by a nationally recognized investment banking firm selected by
each Party or, in the event such firms are unable to agree, the average of
(i) the value determined by a nationally recognized investment banking firm
selected by the first two firms and (ii) the value determined by the other
two firms that is closest to the value determined by the third firm) of such
other property included in such consideration and the date on which Premiere
must exercise its right of first refusal shall be extended until five
business days after the determination of the value of property included in
the consideration, but in no event later than thirty (30) days after receipt
of such Notice.
(c) If Premiere exercises its right of first refusal hereunder, the
closing of the purchase of the Premiere Shares with respect to which such
right has been exercised shall take place within 30 calendar days (or if
required by law or pursuant to any stock exchange rule or policy, within 90
calendar days) after Premiere gives notice of such exercise. If Premiere
does not exercise its right of first refusal hereunder within the time
specified for such exercise, the Person giving the Transfer Notice shall be
free during the period of 180 calendar days following the expiration of such
time for exercise to sell the Premiere Shares specified in such Notice to the
Person identified therein as the proposed transferee in exchange for the
consideration specified therein (or at any price in excess thereof).
-5-
<PAGE>
3.2 Termination of Investment Agreement. Notwithstanding anything
-----------------------------------
contained in this Agreement to the contrary, the provisions of this Article 3
shall terminate, and be of no further force and effect, upon the earlier of (a)
the occurrence of any Extraordinary Transaction in which the holders of Premiere
Voting Securities immediately prior to the Extraordinary Transaction do not
constitute the holders of a majority of the voting securities of the resulting
entity, or do not otherwise have the power to elect a majority of the board of
directors of the resulting entity, (b) the resignation or other termination of
either Boland T. Jones or D. Gregory Smith as executive officers of Premiere, or
(c) the proper termination of the Strategic Alliance Agreement in accordance
with its terms.
ARTICLE 4
REGISTRATION RIGHTS
-------------------
4.1 Demand Registration. If (i) at any time within three years from the
-------------------
date of this Agreement the provisions of Article 3 shall have terminated
pursuant to Section 3.2 hereof and if Premiere shall receive from an Initiating
Holder, within sixty days of such termination, or (ii) at any time within the
third year commencing after the date of this Agreement Premiere shall receive
from an Initiating Holder, a written request that Premiere effect a registration
with respect to all or a part of the Registrable Securities, Premiere will, as
soon as practicable, use its reasonable best efforts to effect such registration
as may be so requested and as would permit or facilitate the sale and
distribution of all or such portion of such Registrable Securities as are
specified in such request, provided that Premiere shall not be obligated to
--------
effect, or take any action to effect, any such registration:
(a) Unless such registration proposes to dispose of Registrable Securities
having an aggregate expected gross offering price of at least ten million
dollars ($10,000,000) or the entire remaining number of Registrable
Securities;
(b) Unless Premiere is eligible to effect the registration under Form S-3
(or a successor form) as promulgated by the SEC or WorldCom agrees to pay
all Registration Expenses (as defined below) in excess of $40,000;
(c) Which could result in the registration statement for such a
registration being declared effective prior to the 90th day subsequent to
the effective date of any registration effective pursuant to Section 5.2 or
5.3 of the Stock Purchase Agreement between Premiere and NationsBanc
Capital Corporation dated January 18, 1994 (it being represented by
Premiere that as of the date hereof no such registration is effective or
pending);
(d) If, upon receipt of a registration request pursuant to this Section
4.1, Premiere is advised by a recognized national independent investment
banking firm selected by Premiere that, in such firm's opinion, a
registration at the time and on
-6-
<PAGE>
the terms requested would adversely affect any public offering of
securities of Premiere by Premiere (other than in connection with benefit
and similar plans) or by or on behalf of any shareholder of Premiere
exercising a demand registration right (collectively, a "Premiere
Offering") with respect to which Premiere has commenced preparations for a
registration prior to the receipt of a registration request pursuant to
this Section 4.1, Premiere shall not be required to effect a registration
pursuant to this Section 4.1 until the earlier of (x) 30 days after the
completion of such Premiere Offering, (y) promptly after any abandonment of
such Premiere Offering or (z) 60 days after the date of receipt of a
registration request pursuant to this Section 4.1 (it being represented by
Premiere that as of the date hereof Premiere has not commenced preparation
for, and has no current plans to commence preparation for, such a
registration);
(e) In any particular jurisdiction in which Premiere would be required to
execute a general consent to service of process in effecting such
registration, qualification or compliance, unless Premiere is already
subject to service in such jurisdiction and except as may be required by
the Securities Act or applicable rules or regulations thereunder; or
(f) After Premiere has effected a registration pursuant to this Section 4.1
and such registration has been declared or ordered effective.
The registration statement filed pursuant to the request of the Initiating
Holders may, subject to the further provisions set forth below, include other
Securities of Premiere including without limitation Securities which are held by
Persons who, by virtue of agreements with Premiere, are entitled to include
their Securities in any such registration ("Other Stockholders"). As of the
date hereof, the Other Stockholders are Sirrom Capital Corporation ("Sirrom"),
NationsBanc Capital Corporation and CMG@Ventures, L.P. ("CMG"). If the
Initiating Holders propose to effect an underwritten distribution pursuant to a
registration effected under this Section 4.1, they shall do so through the
services of such nationally recognized investment banking firm as they may
select, subject to the approval of Premiere, which will not be unreasonably
withheld, conditioned or delayed. If Other Stockholders request inclusion in
any such registration that is underwritten, the Holders shall offer to include
the securities of such Other Stockholders in the underwriting and may condition
such offer on their acceptance of the further applicable provisions of this
Article 4. The Holders whose shares are to be included in such registration and
Premiere shall (together with all Other Stockholders proposing to distribute
their securities through such underwriting) enter into underwriting and related
agreements in customary form with the representative of the underwriter or
underwriters so selected for such underwriting. Such underwriting agreement
will contain such representations and warranties by Premiere and such other
terms and provisions as are customarily contained in underwriting agreements
with respect to secondary distributions, including, without limitation,
indemnities and contribution to the effect and to the extent provided in Section
4.5 hereof and the provision of opinions of counsel and accountants' letters to
the effect and to the extent provided in Section 4.4 hereof, and the
representations and warranties
-7-
<PAGE>
by, and the other agreements on the part of, Premiere to and for the benefit of
such underwriters shall also be made to and for the benefit of the Holders.
Premiere shall cooperate fully with the Holders and the underwriters in
connection with any underwritten offering. Notwithstanding any other provision
of this Article 4, if the representative advises the Holders that marketing
factors require a limitation on the number of shares to be underwritten, the
securities of Premiere held by Other Stockholders (other than shares held by
Sirrom and CMG which Sirrom and CMG has requested be included in the offering
pursuant to existing registration rights granted to Sirrom and CMG) shall be
excluded from such registration to the extent so required by such limitation.
If, after the exclusion of such shares, further reductions are still required,
the number of shares included in the registration by each Holder shall be
reduced on a pro rata basis (based on the number of shares held by such Holder),
by such minimum number of shares as is necessary to comply with such request. No
Registrable Securities or any other securities excluded from the underwriting by
reason of the underwriter's marketing limitation shall be included in such
registration. If any Other Stockholder who has requested inclusion in such
registration as provided above disapproves of the terms of the underwriting,
such person may elect to withdraw therefrom by written notice to Premiere, the
underwriter and the Initiating Holders. The securities so withdrawn shall also
be withdrawn from registration. If the underwriter has not limited the number of
Registrable Securities or other securities to be underwritten, Premiere and
officers and directors of Premiere may include its or their securities for its
or their own account in such registration if the representative so agrees and if
the number of Registrable Securities and other securities which would otherwise
have been included in such registration and underwriting will not thereby be
limited.
4.2 Incidental Registration.
-----------------------
(a) If Premiere at any time proposes to register for sale for its own
account any Premiere Voting Securities under the Securities Act (other than a
registration (i) on Form S-8 or S-4 or any successor or similar forms, (ii)
relating to equity securities issuable upon exercise of employee stock
options or in connection with any employee benefit or similar plan of
Premiere, (iii) in connection with a direct or indirect acquisition by
Premiere of another company or business or any other transaction described in
Rule 145(a) under the Securities Act, or (iv) a registration on any
registration form which does not permit secondary sales or does not include
substantially the same information as would be required to be included in a
registration statement covering the sale of Registrable Securities), in a
manner which would permit registration of Registrable Securities for sale to
the public under the Securities Act, it will each such time give prompt
written notice to the Holders of Registrable Securities of its intention to
do so and of the Holders' rights under this Section 4.2, at least ten
business days prior to the anticipated filing date of the registration
statement relating to such registration. Any such notice shall offer all
such Holders the opportunity to request to include in such registration
statement such number of Registrable Securities as each such Holder may
request. Upon the written request of the Holders made within five business
days after the receipt of
-8-
<PAGE>
notice from Premiere (which request shall specify the number of Registrable
Securities intended to be disposed of by each Holder and the intended method
of disposition thereof), Premiere will use its reasonable best efforts to
effect the registration under the Securities Act of all Registrable
Securities which Premiere has been so requested to register by the Holders
thereof, to the extent requisite to permit the disposition (in accordance
with such intended methods thereof) of the Registrable Securities so to be
registered, subject to the provisions of Section 4.2(b) below; provided that
if, at any time after giving written notice of its intention to register any
securities pursuant to this Section 4.2(a), Premiere shall determine for any
reason not to register such securities (or to withdraw such registration,
whether before or after effectiveness of such registration), Premiere shall
give written notice to the Holders of Registrable Securities and, thereupon,
shall be relieved of its obligation to register any Registrable Securities in
connection with such registration.
(b) If a registration pursuant to this Section 4.2 involves an
underwritten public offering and the managing underwriter advises Premiere
that, in its view, either (i) the size of the offering that Premiere, the
Holders and any other equity securityholders intend to make or (ii) the
combination of securities that Premiere, the Holders and such other
securityholders intend to include in such offering are such that the success
of the offering would be materially and adversely affected, then (A) if the
size of the offering is the basis of such underwriter's advice, Premiere
shall so advise all holders of securities requesting registration, and the
amount of securities that are entitled to be included in the registration and
underwriting shall be allocated in the following manner:
(i) first, all securities to be sold for the account of Premiere or
any of the Other Stockholders ("Priority Holders"), with such priorities
among them as Premiere may determine; and
(ii) second, the number of shares that may be included in the
registration and underwriting by each of the Holders and each other
securityholder (other than Priority Holders) shall be reduced, on a pro
---
rata basis (based on the number of shares requested to be included in
----
such registration), by such minimum number of shares as is necessary to
comply with such limitation; and
(B) if the combination of securities to be offered is the basis of such
underwriter's advice, (x) the Registrable Securities to be included in such
offering shall be reduced as described in clause (A) above) and (y) if the
actions described in sub-clause (x) of this clause (B) would, in the judgment
of the managing underwriter, be insufficient to eliminate the adverse effect
that inclusion of the Registrable Securities requested to be included or
other Premiere securities proposed to be included would have on such
offering, then Premiere may decrease the number of Registrable Securities so
requested, and the securities of shareholders of Premiere other than the
Holders, to be included in such registration (to the extent possible, pro
rata on the basis of the
-9-
<PAGE>
percentage of Registrable Securities requested to be so registered by the
Holders and any securities to be included by shareholders of Premiere other
than the Holders) to the extent necessary to produce the combination
recommended by the managing underwriter.
4.3 Expenses of Registration. One half of all Registration Expenses
------------------------
incurred in connection with any registration, qualification or compliance
pursuant to Section 4.1 (including any supplements or amendments thereto,
whether or not it becomes effective, and whether all, none or some of the
Registrable Securities are sold pursuant to the registration), and all Selling
Expenses incurred in connection with any registration, qualification or
compliance pursuant to either Sections 4.1 or 4.2, shall be borne by the Holders
and the Other Stockholders involved pro rata on the basis of the number of their
shares so registered. All other Registration Expenses shall be borne by
Premiere.
4.4 Registration Procedures. Premiere will keep the Holders, as
-----------------------
applicable, advised in writing as to the initiation of a registration pursuant
to this Article 4 and as to the completion thereof. Premiere will:
(a) furnish to each Holder, and to any underwriter before filing with
the SEC, copies of any registration statement (including all exhibits) and
any prospectus forming a part thereof and any amendments and supplements
thereto (including all documents incorporated or deemed incorporated by
reference therein prior to the effectiveness of such registration statement
and including each preliminary prospectus, any summary prospectus or any term
sheet (as such term is used in Rule 434 under the Securities Act)) and any
other prospectus filed under Rule 434 under the Securities Act, which
documents, other than documents incorporated or deemed incorporated by
reference, will be subject to review of the Holders and any such underwriter
for a period of at least five business days, and Premiere shall not file any
such registration statement or such prospectus or any amendment or supplement
to such registration statement or prospectus to which any Holder or any such
underwriter shall reasonably object within five business days after the
receipt thereof; a Holder or such underwriters shall be deemed to have
reasonably objected to such filing only if the registration statement,
amendment, prospectus or supplement, as applicable, as proposed to be filed,
contains a material misstatement or omission;
(b) furnish to each Holder and to any underwriter, such number of
conformed copies of the applicable registration statement and of each
amendment and supplement thereto (in each case including all exhibits) and
such number of copies of the prospectus forming a part of such registration
statement (including each preliminary prospectus, any summary prospectus or
any term sheet (as such term is used in Rule 434 under the Securities Act))
and any other prospectus filed under Rule 434 under the Securities Act, in
conformity with the requirements of the Securities Act, and such other
documents, including without limitation documents incorporated or deemed to
be incorporated by reference prior to the effectiveness of
-10-
<PAGE>
such registration, as each of the Holders or any such underwriter, from time
to time may reasonably request;
(c) to the extent practicable, promptly prior to the filing of any
document that is to be incorporated by reference into any registration
statement or prospectus forming a part thereof subsequent to the
effectiveness thereof, and in any event no later than the date such document
is filed with the SEC, provide copies of such document to the Holders, if
requested, and to any underwriter, make representatives of Premiere available
for discussion of such document and other customary due diligence matters,
and include such information in such document prior to the filing thereof as
any Holder or any such underwriter reasonably may request;
(d) make available at reasonable times for inspection by the Holders,
any underwriter participating in any disposition pursuant to such
registration and any attorney or accountant retained by the Holders or any
such underwriter, all financial and other records, pertinent corporate
documents and properties of Premiere and cause the officers, directors and
employees of Premiere to supply all information reasonably requested by the
Holders and any such underwriters, attorneys or accountants in connection
with such registration;
(e) use its reasonable best efforts (i) to register or qualify all
Registrable Securities and other securities covered by such registration
under such other securities or blue sky laws of such States of the United
States of America where an exemption is not available and as the sellers of
Registrable Securities covered by such registration shall reasonably request,
(ii) to keep such registration or qualification in effect for so long as the
applicable registration statement remains in effect, and (iii) to take any
other action which may be reasonably necessary or advisable to enable such
sellers to consummate the disposition in such jurisdictions of the securities
to be sold by such sellers, except that Premiere shall not for any such
purpose be required to qualify generally to do business as a foreign
corporation in any jurisdiction where it is not so qualified or otherwise
required to be so qualified, or to subject itself to taxation in any such
jurisdiction, or to execute a general consent to service of process in
effecting such registration, qualification or compliance, unless Premiere is
already subject to service in such jurisdiction and except as may be required
by the Securities Act or applicable rules or regulations thereunder;
(f) use its reasonable best efforts to cause all Registrable
Securities covered by such registration statement to be registered with or
approved by such other federal or state governmental agencies or authorities
as may be necessary in the opinion of counsel to Premiere and counsel to the
Holders of Registrable Securities to enable the Holders thereof to consummate
the disposition of such Registrable Securities;
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<PAGE>
(g) promptly notify each Holder of Registrable Securities covered by a
registration statement (i) upon discovery that, or upon the happening of any
event as a result of which, the prospectus forming a part of such
registration statement, as then in effect, includes an untrue statement of a
material fact or omits to state any material fact required to be stated
therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, (ii) of the
issuance by the SEC of any stop order suspending the effectiveness of such
registration statement or the initiation of proceedings for that purpose,
(iii) of any request by the SEC for amendments to such registration statement
or any document incorporated or deemed to be incorporated by reference in any
such registration statement, supplements to the prospectus forming a part of
such registration statement or additional information, or (iv) of the receipt
by Premiere of any notification with respect to the suspension of the
qualification or exemption from qualification of any of the Registrable
Securities for sale in any jurisdiction or the initiation of any proceeding
for such purpose, and at the request of any such Holder promptly prepare and
furnish to it a reasonable number of copies of a supplement to or an
amendment of such prospectus as may be necessary so that, as thereafter
delivered to the purchasers of such securities, such prospectus shall not
include an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading or otherwise address the matters involved;
(h) use its reasonable best efforts to obtain the withdrawal of any
order suspending the effectiveness of any such registration, or the lifting
of any suspension of the qualification (or exemption from qualification) of
any of the Registrable Securities for sale in any jurisdiction;
(i) if requested by any Initiating Holder, or any underwriter,
promptly incorporate in such registration statement or prospectus, pursuant
to a supplement or post effective amendment if necessary, such information as
the Initiating Holder and any underwriter may reasonably request to have
included therein, including, without limitation, information relating to the
"plan of distribution" of the Registrable Securities, information with
respect to the principal amount or number of shares of Registrable Securities
being sold to such underwriter, the purchase price being paid therefor and
any other terms of the offering of the Registrable Securities to be sold in
such offering and make all required filings of any such prospectus supplement
or post-effective amendment as soon as practicable after Premiere is notified
of the matters to be incorporated in such prospectus supplement or post
effective amendment;
(j) furnish to the Holders, addressed to them, an opinion of counsel
for Premiere, dated the date of the closing under the underwriting agreement,
and use its reasonable best efforts to furnish to the Holders, addressed to
them, a "cold comfort" letter signed by the independent certified public
accountants who have
-12-
<PAGE>
certified Premiere's financial statements included in such registration,
covering substantially the same matters with respect to such registration
(and the prospectus included therein) and, in the case of such accountants'
letter, with respect to events subsequent to the date of such financial
statements, as are customarily covered in opinions of issuer's counsel and in
accountants' letters delivered to underwriters in underwritten public
offerings of securities and such other matters as the Holders may reasonably
request;
(k) provide promptly to the Holders upon request any document filed by
Premiere with the SEC pursuant to the requirements of Section 13 and Section
15 of the Exchange Act;
(m) use its reasonable best efforts to cause all Registrable
Securities included in any registration pursuant hereto to be listed on each
securities exchange on which securities of the same class are then listed,
or, if not then listed on any securities exchange, to be eligible for trading
in any over-the-counter market or trading system in which securities of the
same class are then traded; and
(n) use its reasonable best efforts to keep the registration effective
and current until the Holders have completed the distribution described in
the registration statement relating thereto, or such registration is no
longer required to effect such distribution under applicable law, whichever
first occurs.
4.5 Indemnification.
---------------
(a) Premiere will indemnify each of the Holders, as applicable, each
of its officers, directors, and each person controlling each of the Holders,
with respect to each registration which has been effected pursuant to this
Article 4, and each underwriter, and each person who controls any
underwriter, against all claims, losses, damages and liabilities (or actions
in respect thereof) arising out of or based on any untrue statement (or
alleged untrue statement) of a material fact contained in any prospectus,
offering circular or other document (including any related registration
statement, notification or the like) incident to any such registration,
qualification or compliance, or based on any omission (or alleged omission)
to state therein a material fact required to be stated therein or necessary
to make the statements therein not misleading, or any violation by Premiere
of the Securities Act or the Exchange Act or any rule or regulation
thereunder applicable to Premiere and relating to action or inaction required
of Premiere in connection with any such registration, qualification or
compliance, and will reimburse each of the Holders, each of its officers,
directors, members and partners, and each person controlling each of the
Holders, each such underwriter and each person who controls any such
underwriter, for any legal and any other expenses reasonably incurred in
connection with investigating and defending any such claim, loss, damage,
liability or action, provided that Premiere will not be liable in any such
case to the extent that any such claim, loss, damage, liability or expense
arises out of or is based on any untrue
-13-
<PAGE>
statement or omission based upon written information furnished to Premiere by
the Holders or underwriter and stated to be specifically for use therein.
(b) Each of the Holders will, if Registrable Securities held by it
are included in the securities as to which such registration, qualification
or compliance is being effected, indemnify Premiere, each of its directors
and officers and each underwriter of Premiere's securities covered by such a
registration statement, each person who controls Premiere or such
underwriter, each Other Stockholder and each of their officers, directors,
members and partners, and each person controlling such Other Stockholder
against all claims, losses, damages and liabilities (or actions in respect
thereof) arising out of or based on any untrue statement (or alleged untrue
statement) of a material fact contained in any such registration statement,
prospectus, offering circular or other document made by such Holder, or any
omission (or alleged omission) to state therein a material fact required to
be stated therein or necessary to make the statements by such Holder therein
not misleading, and will reimburse Premiere and such Other Stockholders,
directors, officers, partners, members, persons, underwriters or control
persons for any legal or any other expenses reasonably incurred in connection
with investigating or defending any such claim, loss, damage, liability or
action, in each case to the extent, but only to the extent, that such untrue
statement (or alleged untrue statement) or omission (or alleged omission) is
made in such registration statement, prospectus, offering circular or other
document in reliance upon and in conformity with written information
furnished to Premiere by such Holder and stated to be specifically for use
therein; provided, however, that the obligations of each of the Holders
hereunder and under clause (d) below shall be limited to an amount equal to
the net proceeds to such Holder of securities sold as contemplated herein.
(c) Each party entitled to indemnification under this Section 4.4
(the "Indemnified Party") shall give notice to the party required to provide
indemnification (the "Indemnifying Party") promptly after such Indemnified
Party has actual knowledge of any claim as to which indemnity may be sought,
and shall permit the Indemnifying Party to assume the defense of any such
claim or any litigation resulting therefrom; provided that counsel for the
Indemnifying Party, who shall conduct the defense of such claim or any
litigation resulting therefrom, shall be approved by the Indemnified Party
(whose approval shall not unreasonably be withheld) and the Indemnified Party
may participate in such defense at such party's expense (unless the
Indemnified Party shall have reasonably concluded that there may be a
conflict of interest between the Indemnifying Party and the Indemnified Party
in such action, in which case the fees and expenses of one such counsel for
all Indemnified Parties shall be at the expense of the Indemnifying Party),
and provided further that the failure of any Indemnified Party to give notice
as provided herein shall not relieve the Indemnifying Party of its
obligations under this Article 4 unless the Indemnifying Party is materially
prejudiced thereby. No Indemnifying Party, in the defense of any such claim
or litigation shall, except with the consent of each Indemnified Party (which
consent shall not be unreasonably withheld or delayed),
-14-
<PAGE>
consent to entry of any judgment or enter into any settlement which does not
include as an unconditional term thereof the giving by the claimant or
plaintiff to such Indemnified Party of a release from all liability in
respect to such claim or litigation. Each Indemnified Party shall furnish
such information regarding itself or the claim in question as an Indemnifying
Party may reasonably request in writing and as shall be reasonably required
in connection with the defense of such claim and litigation resulting
therefrom.
(d) If the indemnification provided for in this Section 4.4 is held
by a court of competent jurisdiction to be unavailable to an Indemnified
Party with respect to any loss, liability, claim, damage or expense referred
to herein, then the Indemnifying Party, in lieu of indemnifying such
Indemnified Party hereunder, shall contribute to the amount paid or payable
by such Indemnified Party as a result of such loss, liability, claim, damage
or expense in such proportion as is appropriate to reflect the relative fault
of the Indemnifying Party on the one hand and of the Indemnified Party on the
other in connection with the statements or omissions which resulted in such
loss, liability, claim, damage or expense, as well as any other relevant
equitable considerations. The relative fault of the Indemnifying Party and
of the Indemnified Party shall be determined by reference to, among other
things, whether the untrue (or alleged untrue) statement of a material fact
or the omission (or alleged omission) to state a material fact relates to
information supplied by the Indemnifying Party or by the Indemnified Party
and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission.
(e) Notwithstanding the foregoing, to the extent that the
provisions on indemnification and contribution contained in the underwriting
agreement entered into in connection with any registration contemplated by
this Agreement are in conflict with the foregoing provisions, the provisions
in such underwriting agreement shall be controlling.
(f) The foregoing indemnity agreement of Premiere and Holders is
subject to the condition that, insofar as they relate to any loss, claim,
liability or damage made in a preliminary prospectus but eliminated or
remedied in the amended prospectus on file with the SEC at the time the
registration statement in question becomes effective or the amended
prospectus filed with the SEC pursuant to SEC Rule 434(b) (the "Final
Prospectus"), such indemnity or contribution agreement shall not inure to the
benefit of any underwriter or Holder if a copy of the Final Prospectus was
furnished to the underwriter and was not furnished to the person asserting
the loss, liability, claim or damage at or prior to the time such action is
required by the Securities Act.
4.6 Information to be Furnished by the Holders. Each of the Holders
------------------------------------------
holding securities included in any registration shall furnish to Premiere such
information regarding such Holder and the distribution proposed by such Holder
as Premiere may
-15-
<PAGE>
reasonably request in writing and as shall be reasonably required in connection
with any registration, qualification or compliance referred to in this Article
4.
4.7 Holdback Agreement; Postponement. Notwithstanding the provisions of
--------------------------------
this Article 4, if the Board of Directors of Premiere determines in good faith
that it is in the best interests of Premiere and its shareholders not to
disclose the existence of facts surrounding any proposed or pending acquisition,
disposition, strategic alliance or financing transaction or other material
nonpublic transaction involving Premiere, Premiere will certify such
determination to the Holders and then may, by notice to the Holders, (1) suspend
the rights of the Holders to make sales pursuant to any effective registration
for such a reasonable period of time as the Board of Directors may determine and
(2) postpone any registration which is requested pursuant to this Article 4, in
each case for such a reasonable period of time as the Board of Directors may
determine; provided that no such suspension or postponement shall exceed ninety
(90) days.
4.8 Method of Distribution. If any Holder proposes to effect a
----------------------
distribution of the Premiere Shares pursuant to a registration under this
Article 4 other than in a firm commitment underwriting through one or more
nationally recognized investment banking firm or firms selected pursuant to
Section 4.2, such Holder shall use its best efforts not to disrupt the public
market for Premiere securities (including the price thereof) and, in furtherance
thereof, shall, in connection with such distribution, abide by the volume
limitations of Rule 144(e) promulgated by the SEC (and for such purposes all
Holders shall be treated as one Person).
ARTICLE 5
MISCELLANEOUS
-------------
5.1 Stock Legends. WorldCom understands and agrees that:
-------------
(a) The following legend shall be placed upon all certificates
representing the Premiere Shares (or any replacements thereof) so long as
this Agreement is in effect:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO THE
PROVISIONS OF AN AGREEMENT, DATED AS OF NOVEMBER 11, 1996, BETWEEN PREMIERE
TECHNOLOGIES, INC. AND WORLDCOM, INC. A COPY OF SUCH AGREEMENT IS ON FILE
AT THE OFFICE OF THE SECRETARY OF PREMIERE TECHNOLOGIES, INC. PREMIERE
TECHNOLOGIES, INC. WILL FURNISH TO ANY SHAREHOLDER, UPON REQUEST AND
WITHOUT CHARGE, A FULL STATEMENT OF THE RIGHTS, TERMS AND CONDITIONS OF
SUCH AGREEMENT."
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<PAGE>
(b) The following legend shall be placed upon all certificates
representing the Premiere Shares (or any replacements thereof) until such
shares have been registered or are otherwise freely tradable:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933 OR UNDER ANY STATE SECURITIES LAWS AND MAY
NOT BE TRANSFERRED OR OTHERWISE DISPOSED OF UNLESS REGISTERED UNDER THAT
ACT OR UNDER ANY APPLICABLE STATE SECURITIES LAWS OR AN EXEMPTION FROM
REGISTRATION THEREUNDER IS AVAILABLE. THESE SECURITIES HAVE BEEN ISSUED OR
SOLD IN RELIANCE ON PARAGRAPH (13) OF CODE SECTION 10-5-9 OF THE 'GEORGIA
SECURITIES ACT OF 1973,' AS AMENDED, AND MAY NOT BE SOLD OR TRANSFERRED
EXCEPT IN A TRANSACTION WHICH IS EXEMPT UNDER SUCH ACT OR PURSUANT TO AN
EFFECTIVE REGISTRATION UNDER SUCH ACT.
(c) Premiere may enter a stop transfer order with the transfer agent
or agents of Premiere Shares against the transfer of the Premiere Shares
except in compliance with the requirements of this Agreement. Premiere
agrees to remove promptly any stop transfer order with respect to, and issue
promptly unlegended certificates in substitution for, certificates for the
Premiere Shares that are no longer subject to the restrictions contained in
this Agreement or, as applicable, the Securities Act and applicable state
securities laws.
5.2 Further Assurances. From time to time after the execution of this
------------------
Agreement, as and when requested by Premiere and WorldCom and to the extent
permitted by Georgia law, the Parties shall take or cause to be taken such
further or other action as shall be necessary to carry out the purposes of this
Agreement.
5.3 Remedies. The Parties recognize and hereby acknowledge that it may be
--------
difficult to accurately measure the amount of damages that would result to a
Party by reason of a failure of the other Party to perform any of the
obligations imposed on it by this Agreement. The Parties accordingly agree that
each such Party shall be entitled to an injunction to prevent breaches of this
Agreement and to enforce specifically the terms and provisions hereof in any
court of the United States or any state having jurisdiction, in addition to any
other remedies to which such Party may be entitled at law or in equity in
accordance with this Agreement.
5.4 Notices. Any notices or other communications required or permitted
-------
under this Agreement shall be effective only if it is in writing and delivered
personally, by facsimile transmission, by nationally recognized next business
day courier or by registered or certified mail, postage pre-paid, addressed as
follows:
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<PAGE>
Premiere: Premiere Technologies, Inc.
3399 Peachtree Road, N.E.
The Lenox Building, Suite 400
Atlanta, Georgia 30326
Telecopy No.: (404) 262-8540
Attention: Boland T. Jones
President
and
Patrick G. Jones
Senior Vice President of
Finance and Legal
Copy to Counsel: Alston & Bird
One Atlantic Center
1201 West Peachtree Street
Atlanta, Georgia 30309-3424
Telecopy No.: (404) 881-7777
Attention: Jeffrey A. Allred, Esq.
WorldCom: WorldCom, Inc.
515 East Amite Street
Jackson, Mississippi 39201-2702
Telecopy No.: (601) 360-8190
Attention: David F. Myers
Copy to Counsel: P. Bruce Borghardt
WorldCom, Inc.
10777 Sunset Office Drive, Suite 330
St. Louis, Missouri 03127
Telecopy No.: (314) 909-4101
or such other address as shall be furnished in writing by any of the Parties.
Any such notice or communication shall be deemed to have been given as of the
date so personally delivered, sent by courier or facsimile or mailed.
5.5 Amendments. This Agreement may be amended by a subsequent writing
----------
signed by both Parties upon the approval of each of the Parties.
5.6 Counterparts. This Agreement may be executed in two or more
------------
counterparts all of which shall be one and the same Agreement and shall become
effective when one or more counterparts have been signed by each Party and
delivered to the other Party.
5.7 Headings. The headings in this Agreement are for convenience only and
--------
shall not affect the construction or interpretation of this Agreement.
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<PAGE>
5.8 Successors and Assigns. All terms and conditions of this Agreement
----------------------
shall be binding upon and inure to the benefit of and be enforceable by any
successor to WorldCom and any successor to Premiere. Except as otherwise
provided in this Section 5.8, any assignment of the rights and obligations of
the Parties under this Agreement shall be effective upon a written agreement
signed by all the Parties.
5.9 Severability. If any provision of this Agreement shall be held to be
------------
illegal, invalid or unenforceable, such illegality, invalidity or
unenforceability shall attach only to such provision and shall not in any manner
affect or render illegal, invalid or unenforceable any other provision of this
Agreement, and this Agreement shall be carried out as if any such illegal,
invalid or unenforceable provision were not contained herein.
5.10 Entire Agreement. This Agreement and the agreements referred to
----------------
herein constitutes the entire understanding between and among the Parties with
respect to the subject matter hereof and shall supersede any prior agreements
and understandings among the Parties with respect to such subject matter.
5.11 Interpretations. The Parties acknowledge that this Agreement has been
---------------
reviewed, negotiated and accepted by all Parties and their attorneys and shall
be construed and interpreted according to the ordinary meaning of the words used
so as fairly to accomplish the purposes and intentions of all Parties hereto.
5.12 Attorneys' Fees. In the event of any action to enforce this
---------------
Agreement, the prevailing Party shall be entitled to reimbursement from the
other Party of all costs and expenses incurred in connection with such effort,
including court costs and reasonable attorney's fees.
5.13 Construction of Terms. Whenever used in this Agreement, the singular
---------------------
shall include the plural and the plural the singular. Pronouns of one gender
shall include all genders.
5.14 Governing Law. This Agreement shall be governed by and construed in
-------------
accordance with the laws of the State of Georgia.
5.15 Dispute Resolution. Any disputes between the parties under this
------------------
Agreement shall be resolved pursuant to the provisions of Article 8 of the
Strategic Alliance Agreement.
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<PAGE>
IN WITNESS WHEREOF, each of the Parties has caused this Agreement to be
duly executed and delivered as of the date above written.
PREMIERE TECHNOLOGIES, INC.
By: /s/ Patrick G. Jones
--------------------------------------------------
Name: Patrick G. Jones
------------------------------------------------
Title: Senior Vice President of Finance and Legal
------------------------------------------
WORLDCOM, INC.
By: /s/ David F. Myers
-------------------------------------
Name: David F. Myers
--------------------------------
Title: Treasurer
--------------------------
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<PAGE>
EXHIBIT 10.3
[LOGO OF PREMIERE Premiere Technologies, Inc.
TECHNOLOGIES, INC.
APPEARS HERE]
3399 Peachtree Road N.E.
For More Information, Contact: The Lenox Building, Suite 400
- - ----------------------------- Atlanta, Georgia 30326
Patrick G. Jones (Investors) Telephone: 404 262 8400
Premiere Technologies
(404) 262-8429
Wendy Johnson (Media)
Julie Davis Associates
(404) 266-7562
WORLDCOM AND PREMIERE TECHNOLOGIES
ANNOUNCE STRATEGIC BUSINESS ALLIANCE
ATLANTA -- November 13, 1996 -- Information and telecommunications services
integrator Premiere Technologies, Inc. (NASDAQ: PTEK) today announced that it
has entered into a strategic business relationship with WorldCom, Inc. (NASDAQ:
WCOM), the nation's fourth largest long-distance carrier and the first phone
company to converge local, long distance and Internet services. Terms of the
deal were not disclosed.
The joint development agreement enables WorldCom to couple its voice and
data network with Premiere's advanced, feature-rich platform, leading to new
incremental business opportunities for both companies. The arrangement positions
Premiere as a preferred provider to WorldCom of network-based computer telephony
technology. Together, Premiere and WorldCom will be able to approach companies
with a comprehensive package of services that neither could previously offer
independently in the near term.
In another significant aspect of the deal, WorldCom plans to utilize
Premiere's platform in order to offer Premiere's enhanced services to a portion
of WorldCom's customers.
--more--
<PAGE>
PREMIERE & WORLDCOM/PAGE 2
- - --------------------------
"This relationship with WorldCom establishes Premiere as a provider for
one of the 'big four' telecommunications companies in the nation," said
Boland T. Jones, president and CEO of Premiere Technologies. "Breaking into this
highly coveted top tier marks a milestone for our company and further
substantiates the development of our increased-capacity data center in Dallas.
Aligning with WorldCom means Premiere will have the right tools to offer its
partners a bundled service with the convenience and efficiency of 'one-stop
shopping.'"
WorldCom, Inc. is one of the largest long-distance telephone carriers in
the United States, offering domestic and international voice, data and video
products and services to business customers, other carriers and residential
markets. The company operates a nationwide digital fiber optic network in the
United States and has worldwide network capacity.
Premiere Technologies, founded in 1991, is a network-based computer
telephony company specializing in the integration of information and
telecommunications services. The company's state-of-the-art Network Management
System uses proprietary software to deliver innovative services and customized
data for millions of users in over 100 countries. The company markets its
services directly under the name Premiere WorldLink and through strategic
partners. It also licenses its platform to other telecommunications companies.
This press release contains certain forward-looking statements and projections
(including statements concerning plans and objectives of management for future
operations and services and statements concerning earnings expectations) that
are based on management's belief as well as assumptions made by, and information
currently available to, management. Premiere's actual results might differ
materially from the plans envisioned in, or results acquired by, those
statements if Premiere's assumptions prove to be incorrect or for a variety of
other reasons, those relating to factors identified in Premiere's Prospectus
dated March 5, 1996, and its Quarterly Reports, 10Q filed with the Securities
and Exchange Commission.
###
