STOCKHOLDERS' AGREEMENT
between
V TECHNOLOGY HOLDINGS CORP.,
V TECHNOLOGY ACQUISITION CORP.,
GOLDSTAR TELECOMMUNICATION CO. LTD.,
THE SHERMAN GROUP AND THE OPPORTUNITY FUND,
STEVEN A. SHERMAN,
AND
GLENN R. FITCHET
DATED: MARCH 28, 1994
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This Stockholders' Agreement ("Agreement") made and entered into as of
this 28th day of March, 1994, between V TECHNOLOGY HOLDINGS CORP., a
Delaware corporation ("V Tech Holding"), and V TECHNOLOGY ACQUISITION
CORP, an Arizona corporation ("V Tech Acquisition") with its executive
offices at 8700 East Via de Ventura, Suite 305, Scottsdale, Arizona
85259, GOLDSTAR TELECOMMUNICATION CO., LTD., a corporation organized
under the laws of the Republic of Korea ("GST"), with its executive
offices at Lucky GoldStar Twin Tower, West Tower 20F, #20, Yoido-dong,
Youngdungpo-gu, Seoul 150-721, Korea, THE OPPORTUNITY FUND, a limited
partnership (the "Opportunity Fund"), and THE SHERMAN GROUP, a
participant in the Opportunity Fund (collectively with the Opportunity
Fund, the "FUND") both with their executive offices located at 8700 E.
Via de Ventura, Suite 305, Scottsdale, Arizona 85259, Steven Sherman
("Sherman"), and Glenn R. Fitchet ("Fitchet").
WHEREAS, V Tech Holding owns 100% of the outstanding capital stock of V Tech
Acquisition.
WHEREAS, V Tech Acquisition, Executone Information Systems, Inc. and Vodavi
Communication Systems, Inc. (collectively, "Executone"), are parties to a
certain Asset Purchase Agreement, dated November 5, 1993 (the "Asset Purchase
Agreement"), pursuant to which V Tech Acquisition has agreed to purchase and
acquire from Executone certain of the assets of Executone used in Executone's
Vodavi Communications Systems Division.
WHEREAS, following the consummation of the transactions contemplated by the
Asset Purchase Agreement, V Tech Acquisition will change its name to Vodavi
Communications Systems, Inc., and will own the acquired-assets and operate the
related business under such name.
WHEREAS, GST has agreed to take an ownership interest in V Tech Holding in
exchange for contributing $ 1,500,000 in cash and an eighteen month standby
Letter of Credit in the amount of $1,200,000 and usance in the amount of
$3,500,000 for twelve months. For this contribution, GST will receive 1,500,000
(37.5%) of the outstanding shares of common stock of V Tech Holding upon
consummation of the transactions contemplated by the Asset Purchase Agreement.
WHEREAS, the Fund has agreed to take an ownership interest in V Tech Holding in
exchange for a cash contribution to V Tech Holding of $1,500,000.00. For this
contribution, the Fund will receive 1,500,000 (37.5%) of the outstanding shares
of common stock of V Tech Holding upon consummation of the transactions
contemplated by the Asset Purchase Agreement.
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WHEREAS, The Sherman Group, Sherman and Fitchet were formerly the sole
stockholders of V Tech Acquisition and, upon consummation of the transactions
contemplated in the Asset Purchase Agreement, Sherman and Fitchet will acquire
in the aggregate, 1,000,000 (25%) shares of the outstanding common stock of V
Tech Holding.
WHEREAS, V Tech Acquisition and all stockholders acknowledge that GST's primary
purpose in obtaining an ownership interest in V Tech Holding is to grow with V
Tech Holding on a long-term business basis, not simply investing in expectation
of the potential appreciation of the price of its shares held in V Tech Holding.
WHEREAS, V Tech Acquisition and all Stockholders agree that the short term
business strategy will be to address the small to medium size business
communication market by utilizing telephony-based products to provide
productivity tools to the fastest growing segments of these markets. In the
longer term, as the business evolves and continues to grow, Vodavi
Communications Systems, Inc. will be positioned to take advantage of the
emerging wireless markets, energy management for both small business and
residential, and opportunities created through changes to the telephony network.
WHEREAS, V Tech Acquisition will provide specific market expertise and new
product development directions, and GST will provide hardware development and
manufacturing and the products developed will be marketed in North America by V
Tech Acquisition and internationally by GST.
WHEREAS, the parties hereto desire to provide for certain rights and
restrictions pertaining to the shares of common stock of V Tech Holding.
NOW, THEREFORE, in consideration of mutual covenants and agreements set forth
herein and other good and valuable consideration, the parties hereto hereby
agree as follows:
1. CERTAIN DEFINITIONS. The following terms, wherever used in this Agreement.
shall have the meaning ascribed below. Other terms defined in the body of
the Agreement shall have the meaning assigned therein.
(a) "Affiliate" means, with respect to a specified person, a person that
directly, or indirectly through one or more intermediaries, controls,
is controlled by, or is under common control with, the specified
person, but shall not include any person less than 50% of the ordinary
voting power of which is not directly or indirectly held by the
specified person and its affiliates.
(b) "Common Stock" means the common stock of V Tech Holding, par value
$.001 per share.
(c) "GST Affiliates" means GST or any company within the Lucky GoldStar
Group.
(d) "Maintenance Right" means the right of GST to maintain its
proportionate equity interest in V Tech Holding as provided in Section
4 hereof.
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(e) "Person" or "Persons" means an individual, a corporation, a
partnership, an association, a joint stock company, a joint, venture,
an unincorporated organization, a trust or other entity, including,
without limitation, employee pension, profit sharing and other benefit
plans and trusts.
(f) "Stockholders" means collectively GST, the Fund, Sherman and Fitchet
at such time as shares of Common Stock are actually issued to such
parties, together with any other person that may subsequently become
an owner of record of Common Stock.
2. WARRANTS FOR COMMON STOCK. Following consummation of the transactions
contemplated by the Asset Purchase Agreement and issuance of shares of
common stock as contemplated by the Recitals to this Agreement, V Tech
Holding will also issue warrants to purchase additional shares of Common
Stock (the "Warrants") to the Persons, and in the respective amounts,
specified on SCHEDULE A hereto. The purchase price for each Warrant shall
be Zero Dollars ($0.00). Each Warrant will entitle a Person to purchase the
number of shares of Common Stock represented thereby at a price of $2.00
per share. The Warrants wi1 be exercisable by any Person at any time during
the period commencing on the closing date of the transactions contemplated
by the Asset Purchase Agreement (the "Closing Date") and ending on, the
date which is eighteen (18) months following the Closing Date. The Warrants
will set forth additional terms and conditions of exercise.
3. ESCROW.
(a) ESCROW AGREEMENT. The Stockholders acknowledge and agree that 600,000
of the shares of Common Stock to be acquired by Sherman and Fitchet
will be held in escrow pursuant to an Escrow Agreement (the "Escrow
Agreement") between V Tech Holding, GST, the Fund, Sherman, and
Fitchet. GST will select the escrow agent, provided, however, that
such agent shall be reasonably acceptable to Sherman and Fitchet. Any
escrow fees payable pursuant to the Escrow Agreement will be paid by
GST.
(b) RELEASES OF STOCK FROM ESCROW. The Escrow Agreement will provide that
the six hundred thousand (600,000) shares of Common Stock owned by
Sherman and Fitchet will be released from escrow as follows:
(1) Two hundred thousand (200,000) shares of escrowed stock will be
returned to Sherman and Fitchet upon payment of the document
against acceptance 360-day usance of $3.5 Million Dollars within
twelve (12) months. In the event that the condition set forth in
the preceding sentence is not met, then the two hundred thousand
(200,000) shares shall be retained by and become the property of
GST.
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(2) An additional two hundred thousand (200,000) shares of escrow
stock will be returned to Sherman and Fitchet upon achieving the
business case of the first year. In the event that the conditions
set forth in the preceding sentence is not met, then the two
hundred thousand (200,000) shares of escrowed stock shall be
retained by and become the property of GST.
(3) One hundred thousand (100,000) shares of escrowed stock will be
returned to Sherman and Fitchet upon payment of the $1.2 Million
Dollar standby letter of credit guaranteed by GST within 18
months of closing. In the event that the condition set forth in
the preceding sentence is not met, then the one hundred thousand
(100,000) shares of escrowed stock shall be retained by and
become the property of GST.
(4) One hundred thousand (100,000) shares of escrowed stock will be
returned to Sherman and Fitchet upon achieving the business case
for the second year. In the event that the conditions set forth
in the preceding sentence are not met, then the one hundred
thousand (100,000) shares shall be retained by and shall become
the property of GST.
(5) Notwithstanding the escrowed shares shall become the property of
GST in accordance with the above, it shall not mean that the V
Tech acquisition shall be relieved form the relevant
responsibility and liability under this Agreement.
Criteria for achieving the business case in year one and year two will be
sales target and operating income before tax. The business case goals will
be finalized by GST, Sherman and Fitchet after the execution of this
Stockholders Agreement
4. GST'S RIGHT TO MAINTAIN EQUITY INTEREST. The Stockholders and V Tech
Holding acknowledge and agree that GST shall be entitled in its discretion
to make the following additional purchases of Common Stock, and V Tech
Holding will reasonably cooperate with GST in order to effectuate such of
these purchases as GST shall elect to make.
(a) COMMON STOCK MAINTENANCE RIGHT. If at any time during the term of this
Agreement, V Tech Holding shall sell or issue shares of Common Stock
in a public offering or private placement, which securities, when
issued, amount in the aggregate to 1% or more of V Tech Holding's then
issued and outstanding Common Stock, (the "New Shares") V Tech Holding
shall in each such instance promptly give written notice of such sale
or issuance of New Shares to GST including the number of shares
subject thereto and the price per share to be paid therefor. GST shall
thereupon have the right (the "Maintenance Right"), exercisable for a
period of sixty (60) days after receipt of such written notice, to
irrevocably offer to purchase from V Tech Holding such portion of the
New Shares as would be required to maintain GST's percentage interest
of Common Stock at the level of ownership held by GST immediately
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prior to the offering of New Shares (the "Maintenance Amount"). GST
shall not have any rights under this Section 4 to purchase additional
shares of Common Stock in excess of the Maintenance Amount.
(b) If GST desires to exercise its Maintenance Right, it shall give notice
of exercise to V Tech Holding, specifying the Maintenance Amount with
respect to the offering of New Shares giving rise to the Maintenance
Right. Such notice shall constitute an irrevocable offer to purchase
the number of shares of Common Stock set forth therein on the terms
provided in this Section 4.
Following receipt of a notice of exercise from GST, V Tech Holding
shall, prior to the expiration of such sixty (60) day period notify
GST that it intends to sell to GST the Maintenance Amount specified in
GST's exercise notice.
(c) The purchase price for the shares of Common Stock to be purchased by
GST in accordance with this Section 4 shall be, in the case of a
public offering of New Shares, the public offering price per share,
and in the case of a private placement of New Shares, the price per
share paid by the purchaser(s) in such transaction.
(d) Within five (5) days following receipt of a notice from V Tech Holding
agreeing to sell shares of Common Stock to GST under this Section 4,
GST shall deliver to V Tech Holding the purchase price payable on
account thereof of immediately available funds against delivery of the
certificates, registered in GST's name, evidencing the additional
shares of Common Stock so purchased by GST. All such shares of Common
Stock, will, upon payment therefore, be validly issued, fully paid and
nonassessable and any necessary approvals to the sale shall have been
obtained.
5. SALE OF COMMON STOCK BY GST & OTHER SHAREHOLDERS. All sales of Common Stock
by GST and other shareholders must be in accordance with the laws of the
United States. In the event GST chooses to sell its shares, it must give
Sherman and Fitchet a right of first refusal to purchase GST's shares, and
likewise, Sherman and Fitchet shall give GST a right of first refusal to
purchase its shares at fair market value. This reciprocal right of first
refusal shall be for a limited time with terms and conditions to be
mutually agreed upon.
6. REPRESENTATIONS AND WARRANTIES OF V TECH HOLDING AND V TECH ACQUISITION.V
Tech Holding and V Tech Acquisition hereby represent and warrant to GST as
follows:
(a) ORGANIZATION AND GOOD STANDING -- V TECH HOLDING. V Tech Holding is a
corporation duly organized, validly existing and in good standing
under the laws of Delaware with power to enter into and carry out this
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Agreement. V Tech Holding has power and authority (corporate and
other) to own its properties and conduct its business, as now being
conducted and as presently proposed to be conducted; and V Tech
Holding is duly qualified and in good standing as a foreign
corporation in all jurisdictions in which its ownership or leasing or
material properties or the conduct of its material business requires
such qualification.
(b) ORGANIZATION AND GOOD STANDING -- V TECH ACQUISITION. V Tech
Acquisition is a corporation duly organized, validly existing and in
good standing under the laws of Arizona with power to enter into and
carry out this Agreement. V Tech Acquisition has power and authority
(corporate and other) to own its properties and conduct its business,
as now being conducted and as presently proposed to be conducted; and
V Tech Acquisition is duly qualified and in good standing as a foreign
corporation in all jurisdictions in which its ownership or leasing or
material properties or the conduct of its material business requires
such qualification.
(c) AUTHORITY. V Tech Holding and V Tech Acquisition have the corporate
power and authority to execute and delivery of this Agreement and to
consummate the transactions to be performed by them as contemplated
herein. The execution, delivery and performance of this Agreement has
each been duly authorized by the Board of Directors of V Tech Holding
and V Tech Acquisition and no other corporate approvals are necessary
therefor. This Agreement constitutes a valid and binding agreement of
V Tech Holding and V Tech Acquisition.
(d) AGREEMENT WILL NOT VIOLATE OTHER RESTRICTIONS. The execution and
delivery of this Agreement will not (i) conflict with or result in a
breach of any provisions of, or constitute a default (or an event
which, with notice or lapse of time or both, would constitute a
default or could give rise to a right of termination) under any of the
terms, conditions or provisions of, the charter or by-laws of V Tech
Holding or V Tech Acquisition, or under any other material note, bond,
mortgage, indenture, license agreement or other instrument or
obligation to which V Tech Holding or V Tech Acquisition is a party,
or by which it or any of its properties or assets may be bound, or
(ii) violate any material order, writ, injunction, decree, statute,
rule or regulation applicable to V Tech Holding or V Tech Acquisition,
or to any of its properties or assets.
(e) GOVERNMENT APPROVAL. No authorization, license, permit, franchise,
approval, order or consent of, and no registration, declaration or
filing by V Tech Holding or V Tech Acquisition with any governmental
authority, domestic or foreign, is required in connection with the
execution, delivery and performance by V Tech Holding or V Tech
Acquisition of this Agreement.
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(f) COMPLIANCE WITH APPLICABLE LAWS. V Tech Holding and V Tech Acquisition
are in substantial compliance with all laws and regulations and all
order and decrees applicable to it, the violation of which might have
a material adverse effect on the financial position or business of V
Tech Holding or V Tech Acquisition.
(g) LITIGATION. There are no actions or proceedings before or by any court
or governmental agency or body pending, or to the knowledge of V Tech
Holding or V Tech Acquisition threatened, which might individually or
in the aggregate result in any material adverse change in the
condition (financial or otherwise), business or prospects of V Tech
Holding, or which would materially and adversely affect its properties
or assets.
(h) NO PRIOR BUSINESS ACTIVITY. Except for the Asset Purchase Agreement
and except for this Agreement and the companion agreements
contemplated herein, neither V Tech Holding or V Tech Acquisition has
engaged in any prior business activity and neither has any contacts,
debts or contingent liabilities.
7. REPRESENTATIONS AND WARRANTIES OF GST. GST hereby represents and warrants
to V Tech Holding as follows;
(a) ORGANIZATION AND GOOD STANDING. GST is a corporation duly organized,
validly existing and in good standing under the laws of the Republic
of Korea with power and authority (corporate and other) to own its
properties and conduct its business, as now being conducted and as
presently proposed to be conducted.
(b) AUTHORITY. GST has the corporate power and authority to execute,
deliver and perform this Agreement and to consummate the transactions
contemplated by this Agreement. The execution, delivery and
performance of this Agreement has each been duly authorized by the
Board of Directors of GST and no other corporate approvals are
necessary therefor, and there are no charter documents, controls or
agreements to which GST is subject which would prohibit GST's
performance under this Agreement. This Agreement has been duly
executed and delivered by GST and constitutes a valid and binding
agreement of GST.
(c) GOVERNMENT APPROVAL. Except for the approval of the Korean Government,
if necessary, no authorization, license, permit, franchise, approval,
order or consent of, and no registration, declaration or filing by GST
with any governmental authority, domestic or foreign, is required in
connection with the execution, delivery and performance of this
Agreement.
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8. ELECTION OF DIRECTORS VOTING -- V TECH HOLDING.
(a) NUMBER OF DIRECTORS WHILE PRIVATE COMPANY. For such period of time
that V Tech Holding shall be a privately held company, then the Board
of Directors of V Tech Holding shall consist of four (4) members. Each
of the Stockholders covenants and agrees that upon the consummation of
the transactions contemplated by the Asset Purchase Agreement and
issuance of shares of Common Sock as contemplated by the Recitals to
this Agreement, such Stockholder will vote his or its shares of Common
Stock in such a way as to cause two (2) persons designated by GST to
be elected as directors of V Tech Holding.
(b) NUMBER OF DIRECTORS AFTER PUBLIC OFFERING OF COMMON STOCK. At such
time as there is a public offering of the Common Stock of V Tech
Holding, the number of members on the Board of Directors of V Tech
Holding may be expanded. Notwithstanding the preceding, for the first
12 months after closing, or until the $3.5 Million Dollars usance is
repaid, GST will, regardless of its percentage ownership of stock, be
entitled to a minimum of 34% of the directors. Thereafter, GST shall
be entitled to Elect as directors of V Tech Holding, that number of
directors equal to GST's then percentage of ownership of Common Stock,
provide, however, each Stockholder covenants and agrees that so long
as GST shall own eight percent (8%) or more of the outstanding Common
Stock of V Tech Holding, such Stockholder will vote his or its shares
of Common Stock in favor of the election of at least one (1) designee
of GST to be elected as director of V Tech Holding.
(c) OPPORTUNITY TO RESTORE. In the event that an issuance of Common Stock
by V Tech Holding shall reduce GST's proportion of ownership of Common
Stock and thereby eliminate the designee to which it is entitled, no
change in GST's designee shall be made until GST shall have a
reasonable opportunity to restore its proportionate ownership in
accordance with Section 4 hereof.
(d) GST DESIGNEE. All designees of GST to the Board of Directors shall be
executive officers or directors of GST or directors of any GST
Affiliate or other person reasonably acceptable to V Tech Holding and
the Stockholders. Each of the Stockholders hereby further agrees that,
during the term of this Agreement, no person designated by GST to
serve on V Tech Holding's Board of Directors may be removed as a
director of V Tech Holding without cause, unless GST consents to such
removal in writing.
(e) GST DIRECTOR EMPLOYED BY V TECH ACQUISITION. One of GST's directors
shall be employed by V Tech Acquisition in a job and at such salary
mutually acceptable to GST and to V Tech Acquisition.
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9. ELECTION OF DIRECTORS; VOTING--V TECH ACQUISITION.
(a) NUMBER OF DIRECTORS. The Board of Directors of V Tech Acquisition
shall consist of four members. Each of the Stockholders covenants and
agrees that upon the consummation of the transactions contemplated by
the Asset Purchase Agreement, an issuance of shares of Common Stock as
contemplated by the Recitals to this Agreement, such Stockholder shall
vote his or her shares of Common Stock in such a way to cause two
persons designated by GST to be elected as Directors of V Tech
Acquisition.
(b) GST DESIGNEES. All designees of GST to the Board of Directors shall be
executive officers or directors of GST or directors of any GST
affiliate or other person reasonably acceptable to V Tech Acquisition
and the Stockholders. Each of the Stockholders hereby further agrees
that, during the term of this Agreement, no person designated by GST
to serve on V Tech Holding's Board of Directors may be removed as a
director of V Tech Acquisition without cause, unless GST consents to
such removal in writing.
(c) If and when V Tech Holding exercises its right of resolution at the V
Tech Acquisition's Shareholder's Meeting, the person who exercises its
voting right shall get first authorization from V Tech Holding's Board
of Directors for the delegated scope and directing of the resolution.
10. MAJOR DECISIONS -- FIRST THREE YEARS. Notwithstanding anything to the
contrary contained herein, for a period of three years from closing, V Tech
Acquisition and V Tech Holding will not make any Major Decision without
GST's approval.
11. SPECIFIC ENFORCEMENT. The Stockholders acknowledge and agree that each
party hereto would be irreparably damaged in the event any of the
provisions of Sections 2, 3, 4 and 8 hereof are not performed by the
parties in accordance with their terms or are otherwise breached, and that
no adequate remedy exists at law for such breach or failure to perform. It
is accordingly agreed that the parties shall be entitled to injunctive
relief (including, without (limitation, a temporary restraining order or a
preliminary injunction) to prevent breaches of any of such Sections and to
specifically enforce any of such Sections and the terms and provisions
thereof in any action instituted in any court of the United States or any
state thereof having subject matter jurisdiction, in addition to any other
remedy to which any of the parties may be entitled, at law or in equity.
12. MAJOR DECISIONS. The Bylaws of V Tech Holding and V Tech Acquisition shall
contain the following paragraph:
MAJOR DECISIONS. Major Decisions of the Board of Directors shall require a
vote of two-thirds of the entire Board of Directors then in office, rather
than a majority vote. The Major Decisions shall include the following: a
public issuance of stock (but not including the initial public issuance of
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stock), the merger with or the acquisition of another business or the
acquisition of a significant amount of the assets of another business, the
sale of a significant amount of the assets of the company, the entering
into contracts with Stockholders or directors, the assumption of, or the
acquisition of major debt which is defined as debt in excess of $1 Million
Dollars and amendment of the Articles of Incorporation and By-Laws of the
V-Tech Holding and /or V-Tech Acquisition.
13. TERMINATION. This Agreement shall terminate and be of no further force and
effect upon the unanimous consent of the Stockholders.
14. LIEN ON INVENTORY AND RECEIVABLES. GST shall be entitled to receive a first
position security interest in the inventory and receivables of V Tech
Acquisition, provided that G E Capital has released its lien on the
inventory and receivables of V Tech Acquisition and, provided further,
that:
(a) The $3.5 Million Dollar usance is in effect and V Tech Acquisition has
not provided GST with a satisfactory letter of credit to secure the
purchase of inventory; or
(b) The $1.2 Million Dollar standby letter of credit provided by GST is
still in effect and V Tech Acquisition has not provided GST with a
satisfactory letter of credit to secure the purchase of inventory; or
(c) V Tech Acquisition has requested and is receiving 45-day payment terms
on its inventory purchases and V Tech Acquisition has not provided GST
with a satisfactory letter of credit to secure the purchases of
inventory. For purposes of this paragraph, the term "satisfactory
letter of credit" means letter of credit mutually acceptable to GST
and V Tech Holding.
15. CONTINGENCY. The obligations of all of the parties under this Agreement are
contingent upon the closing of the Asset Purchase Agreement.
16. ACCESS TO FINANCIAL INFORMATION. V Tech Holding and V Tech Acquisition
shall: (i) provide access during normal business hours to GST and any of
its officers, employees and agents, upon reasonable prior notice, to the
properties and facilities of V Tech Holding and V Tech Acquisition; (ii)
permit GST and any of its officers, employees and agents to inspect, audit
and make extracts from all V Tech Holding and V Tech Acquisition records,
files and books of account, and (iii) permit GST to inspect, review and
evaluate V Tech Holding and V Tech Acquisition accounts and other records
(excluding attorney-client privileged documents), at V Tech Holding and V
Tech Acquisition locations and at premises not owned by or leased to V Tech
Holding and V Tech Acquisition. V Tech Holding and V Tech Acquisition shall
make available to GST and its counsel, as quickly as practicable under the
circumstances, copies of all books, records, board minutes, contracts,
insurance policies, environmental audits, business plans, files, financial
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statements (actual and pro forma), filings with federal, state and local
regulatory agencies, and other instruments and documents (excluding
attorney-client privileged documents) that GST may request. V Tech Holding
and V Tech Acquisition shall deliver any document or instrument reasonably
necessary for GST, as it may from time to time request, to obtain records
from any service bureau or other Person which maintains records for V Tech
Holding and V Tech Acquisition. Upon request of GST, V Tech Holding and V
Tech Acquisition shall instruct its certified public accountants and its
banking and other financial institutions to make available to GST such
information and records as GST may reasonably request. It is the intent of
all of the parties hereto that each party to this Agreement shall pay its
own expenses related thereto.
17. MISCELLANEOUS
(a) SEVERABILITY. If any term or provision of this Agreement is held by a
court of competent jurisdiction or other authority to be invalid,
void, unenforceable or against its regulatory policy, the remainder of
the terms, provisions, covenants and restrictions of this Agreement
shall remain in full force and effect and shall in no way to be
affected, impaired or invalidated.
(b) SUCCESSORS ASSIGNMENT. This Agreement shall be binding upon and shall
inure to the benefit of and be enforceable by the successors of the
parties hereto. Except as otherwise provided herein, this Agreement
shall not be assignable. GST shall have the right to transfer all or
any of the shares of Common Stock owned by it to any GST Affiliate;
provided, however, that such GST Affiliate shall agree in advance in
writing to be bound by all the terms of this Agreement. In such case,
such GST Affiliate shall be entitled to enforce all of the terms and
conditions of this Agreement to the same extent as this Agreement
could be enforced by GST.
(c) AMENDMENT. This Agreement may not be modified, amended, altered or
supplemented except by a written agreement signed by each of the
Stockholders which shall be authorized by all necessary corporate or
other action of each party.
(d) SURVIVAL OF REPRESENTATIONS, WARRANTIES AND COVENANTS. All
representations, warranties, covenants and agreements made herein
shall survive the execution and delivery of this Agreement, the
issuance of Common Stock pursuant hereto and the payment therefor.
(e) Notices. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be given (and
shall be deemed to
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have been duly given if given) by delivery, cable, telegram or telex,
or by mail (registered or certified mail, postage prepaid, return
receipt requested) to the respective parties as follows:
If to V Tech Holding:
Steven A. Sherman, Chairman
V Technology Holdings Corp.
8700 E. Via de Ventura, Suite 305
Scottsdale, Arizona 85259
with a copy to:
Robert Kant, Esq.
O'Connor Cavanagh
One East Camelback Road
Suite 1100
Phoenix, Arizona 85012-1656
If to GST:
President S.H. Oh
GoldStar Telecommunication Co., Ltd.
Lucky GoldStar Twin Tower, West Tower 20F
#20, Yoido-dong
Youngdungpo-gu, Seoul 150-721, Korea
If to the Fund:
THE OPPORTUNITY FUND
8700 E. Via de Ventura, Suite 305
Scottsdale, Arizona 85259
THE SHERMAN GROUP
8700 E. Via de Ventura, Suite 305
Scottsdale, Arizona 85259
If to Sherman:
Steven A. Sherman
8700 E. Via de Ventura, Suite 305
Scottsdale, Arizona 85259
If to Fitchet:
Glenn R. Fitchet
8300 E. Raintree Drive
Scottsdale, AZ 85260
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or to such address as any party, may have furnished to the other parties in
writing in accordance herewith, except that notices of change of address shall
only be effective upon receipt.
(f) CONTROLLING LAW; EXCLUSIVE JURISDICTION AND VENUE. THIS AGREEMENT AND
ALL QUESTIONS RELATING TO ITS VALIDITY, INTERPRETATION, PERFORMANCE
AND ENFORCEMENT, SHALL BE GOVERNED BY AND CONSTRUED, INTERPRETED AND
ENFORCED IN ACCORDANCE WITH THE LAW OF THE STATE OF ARIZONA,
NOTWITHSTANDING ANY ARIZONA OR OTHER CONFLICT-OF-LAWS PROVISIONS TO
THE CONTRARY. THE PARTIES AGREE THAT ANY ACTION BROUGHT BY ANY PARTY
AGAINST ANY OTHER PARTY IN CONNECTION WITH ANY RIGHTS OR OBLIGATIONS
ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY
SHALL BE INSTITUTED PROPERLY IN A UNITED STATES FEDERAL COURT OR STATE
COURT OF COMPETENT JURISDICTION WITH VENUE ONLY IN THE COUNTY OF
MARICOPA, STATE OF ARIZONA, OR IN THE FEDERAL DISTRICT COURT OF
ARIZONA. GST HEREBY AGREES TO SUBMIT PERSONALLY TO THE JURISDICTION OF
A COURT OF COMPETENT SUBJECT MATTER JURISDICTION LOCATED IN SUCH
COUNTY OR FEDERAL DISTRICT.
(g) COUNTERPARTS; HEADINGS. This Agreement may be executed in several
counterparts, each of which shall be an original, but all of which
together shall constitute one and the same agreement. The headings
contained in this Agreement are solely to the convenience of the
parties, and are not intended to and do not limit, construe or modify
any of the terms and conditions hereof.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed as of the day and year first above written.
V TECHNOLOGY HOLDINGS CORP.
By: Steven Sherman
Attest: -----------------------------------
Title: Chairman, President
/s/ Glenn R. Fitchet
-------------------------------------
V TECHNOLOGY ACQUISITION CORP.
By: Steven Sherman
Attest: -----------------------------------
Title: President
/s/ Glenn R. Fitchet
-------------------------------------
GOLDSTAR TELECOMMUNICATION CO. LTD.
By: S.H. Oh
Attest: -----------------------------------
Title: President
/s/ D. H. Kim
-------------------------------------
THE OPPORTUNITY FUND
By: Steven Sherman
Attest: -----------------------------------
Title: President
/s/ Glenn R. Fitchet
-------------------------------------
THE SHERMAN GROUP
By: Steven Sherman
Attest: -----------------------------------
Title: President
/s/ Glenn R. Fitchet
-------------------------------------
STEVEN A. SHERMAN
By: Steven Sherman
Attest: -----------------------------------
/s/ Glenn R. Fitchet
-------------------------------------
GLENN R. FITCHET
By: Glenn R. Fitchet
Attest: -----------------------------------
/s/ Steven Sherman
-------------------------------------
15
<PAGE>
SCHEDULE A
Warrants
Each of the following persons or entities will be issued warrants giving them
an option to purchase the respective number of shares of Common Stock set forth
below at $2.00 per share at anytime during the 18 months after the date on which
the closing of the transactions contemplated by the Asset Purchase Agreement
occurs.
- The Fund 750,000 shares
- GST 750,000 shares
- Sherman 750,000 shares
