<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q/A
Amendment No. 1
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended August 31, 1996
or
[_] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE OF 1934
For the transition period from _____________ to _____________
COMMISSION FILE NUMBER 0-22972
CELLSTAR CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 75-2479727
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1730 BRIERCROFT COURT
CARROLLTON, TEXAS 75006
TELEPHONE (972) 466-5000
(Address, including zip code, and telephone number,
including area code, of registrant's principal executive offices)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No ___
---
On October 11, 1996, there were 19,273,562 outstanding shares of Common Stock,
$0.01 par value per share.
<PAGE>
CELLSTAR CORPORATION
INDEX TO FORM 10-Q
Page
Number
------
PART I. - FINANCIAL INFORMATION
- ------ ---------------------
Item 1. FINANCIAL STATEMENTS
CONSOLIDATED BALANCE SHEETS
August 31, 1996 (unaudited) and November 30, 1995 *
CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)
Three and nine months ended August 31, 1996 and 1995 *
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (unaudited)
Nine months ended August 31, 1996 *
CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)
Nine months ended August 31, 1996 and 1995 *
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(unaudited) *
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS *
PART II. - OTHER INFORMATION
- -------- -----------------
Item 1. LEGAL PROCEEDINGS *
Item 2. CHANGES IN SECURITIES *
Item 3. DEFAULTS UPON SENIOR SECURITIES *
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS *
Item 5. OTHER INFORMATION *
Item 6. EXHIBITS AND REPORTS ON FORM 8-K 3
_________________________
* Not amended.
2
<PAGE>
PART II - OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(A) EXHIBITS.
2.1 Asset Purchase Agreement, dated as of October 1, 1996, by and
among MCI Telecommunications Corporation and National Auto
Center, Inc., CellStar Ltd. and CellStar Corporation (5)(6)
3.1 Amended and Restated Certificate of Incorporation of the
Company (1)
3.2 Amended and Restated Bylaws of the Company (3)
4.1 The Amended and Restated Certificate of Incorporation and
Amended and Restated Bylaws of the Company filed as Exhibits
3.1 and 3.2 are incorporated into this item by reference
(1)(3)
3
<PAGE>
4.2 Specimen Common Stock Certificate of the Company (2)
10.1 Second Amendment to Amended and Restated Loan Agreement, dated
as of July 31, 1996, among National Auto Center, Inc.,
CellStar Corporation, each of the banks or other lending
institutions signatory thereto, and Texas Commerce Bank
National Association (4)
10.2 Third Amendment to Amended and Restated Loan Agreement, dated
as of July 31, 1996, among National Auto Center, Inc.,
CellStar Corporation, each of the banks or other lending
institutions signatory thereto, and Texas Commerce Bank
National Association (4)
10.3 Agreement by and between Motorola Inc., by and through its Pan
American Cellular Subscriber Group, and CellStar, Ltd.,
effective January 1, 1996 (Domestic U.S.) (5)(6)
27.1 Financial Data Schedule (4)
- ----------------------------------------
(1) Previously filed as an exhibit to the Company's Quarterly
Report on Form 10-Q for the quarter ended August 31, 1995, and
incorporated herein by reference.
(2) Previously filed as an exhibit to the Company's Annual Report
of Form 10-K for the fiscal year ended November 30, 1995, and
incorporated herein by reference.
(3) Previously filed as an exhibit to the Company's Quarterly
Report on Form 10-Q for the quarter ended February 29, 1996,
and incorporated herein by reference.
(4) Previously filed as an exibit to the Company's Quarterly
Report on Form 10-Q for the quarter ended August 31, 1996,
filed October 15, 1996, and incorporated herein by reference.
(5) Filed herewith.
(6) Certain provisions of this exhibit are subject to a request
for confidential treatment filed with the Securities and
Exchange Commission.
(B) REPORTS ON FORM 8-K.
None.
4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
as amended, the Registrant has duly caused this report to be signed on
its behalf by the undersigned thereunto duly authorized.
CELLSTAR CORPORATION
By: /s/ RICHARD M. GOZIA
----------------------------------
Richard M. Gozia,
Executive Vice President-
Administration and Chief Financial
Officer
Date: December 6, 1996
5
<PAGE>
EXHIBIT INDEX
---------------
<TABLE>
<CAPTION>
Exhibit
No. Description
------- ------------------------------------------------------------
<S> <C>
2.1 Asset Purchase Agreement, dated as of October 1, 1996, by and
among MCI Telecommunications Corporation and National Auto
Center, Inc., CellStar Ltd. and CellStar Corporation (5)(6)
3.1 Amended and Restated Certificate of Incorporation of the
Company (1)
3.2 Amended and Restated Bylaws of the Company (3)
4.1 The Amended and Restated Certificate of Incorporation and
Amended and Restated Bylaws of the Company filed as Exhibits
3.1 and 3.2 are incorporated into this item by reference
(1)(3)
4.2 Specimen Common Stock Certificate of the Company (2)
10.1 Second Amendment to Amended and Restated Loan Agreement, dated
as of July 31, 1996, among National Auto Center, Inc.,
CellStar Corporation, each of the banks or other lending
institutions signatory thereto, and Texas Commerce Bank
National Association (4)
10.2 Third Amendment to Amended and Restated Loan Agreement, dated
as of July 31, 1996, among National Auto Center, Inc.,
CellStar Corporation, each of the banks or other lending
institutions signatory thereto, and Texas Commerce Bank
National Association (4)
10.3 Agreement by and between Motorola Inc., by and through its Pan
American Cellular Subscriber Group, and CellStar, Ltd.,
effective January 1, 1996 (Domestic U.S.) (5)(6)
27.1 Financial Data Schedule (4)
</TABLE>
________________________________________
(1) Previously filed as an exhibit to the Company's Quarterly
Report on Form 10-Q for the quarter ended August 31, 1995, and
incorporated herein by reference.
(2) Previously filed as an exhibit to the Company's Annual Report
of Form 10-K for the fiscal year ended November 30, 1995, and
incorporated herein by reference.
(3) Previously filed as an exhibit to the Company's Quarterly
Report on Form 10-Q for the quarter ended February 29, 1996,
and incorporated herein by reference.
(4) Previously filed as an exhibit to the Company's Quarterly
Report on Form 10-Q for the quarter ended August 31, 1996,
filed October 15, 1996, and incorporated herein by reference.
(5) Filed herewith.
(6) Certain provisions of this exhibit are subject to a request
for confidential treatment filed with the Securities and
Exchange Commission.
6
<PAGE>
EXHIBIT 2.1
ASSET PURCHASE AGREEMENT
BY AND AMONG
MCI TELECOMMUNICATIONS CORPORATION
AND
NATIONAL AUTO CENTER, INC.
CELLSTAR, LTD.
AND
CELLSTAR CORPORATION
October 1, 1996
CONFIDENTIAL
THIS AGREEMENT HAS CONFIDENTIAL PORTIONS OMITTED,
WHICH PORTIONS HAVE BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION. OMITTED
PORTIONS ARE INDICATED IN THIS AGREEMENT WITH
BRACKETS ([ ]).
<PAGE>
TABLE OF CONTENTS
ARTICLE 1 -- DEFINITIONS ................................................... 1
1.1 "Acquired Assets" .......................................... 1
1.2 "Accord" ................................................... 1
1.3 "Activation Contracts" ..................................... 1
1.4 "Advertising Allowance" .................................... 1
1.5 "Affiliate" ................................................ 2
1.6 "Assets Determination" ..................................... 2
1.7 "Assumed Liabilities" ...................................... 2
1.8 "AT&T Contract" ............................................ 2
1.9 "AT&T Locations" ........................................... 2
1.10 "Best Efforts" ............................................ 2
1.11 "Bill of Sale" ............................................ 2
1.12 "Book Value" .............................................. 2
1.13 "Business" ................................................ 2
1.14 "Business Employees" ...................................... 2
1.15 "Business Intellectual Property Rights" ................... 2
1.16 "Code" .................................................... 2
1.17 [REDACTED] ................................................ 2
1.18 "Contracts" ............................................... 3
1.19 "Closing" ................................................. 3
1.20 "Closing Date" ............................................ 3
1.21 "Closing Amount" .......................................... 3
1.22 "Confidential Information" ................................ 3
1.23 "Consents" ................................................ 3
1.24 "Distribution Agreement" .................................. 3
1.25 "Employees" ............................................... 3
1.26 "Employment Loss" ......................................... 3
1.27 "Encumbrance" ............................................. 3
1.28 "Environment" ............................................. 3
1.29 "Environmental, Health, and Safety Laws" .................. 4
1.30 "ERISA" ................................................... 4
1.31 "ERISA Plans" ............................................. 4
1.32 "Exchange Act" ............................................ 4
1.33 "Excluded Assets" ......................................... 4
1.34 "Excluded Agreements" ..................................... 4
1.35 "Facilities" .............................................. 4
1.36 "Final Statement" ......................................... 4
1.37 "Financial Statements" .................................... 4
1.38 "Fixed Assets" ............................................ 4
1.39 "GAAP" .................................................... 4
CONFIDENTIAL i
- --------------------------
Brackets ([/]) indicate cofidential portions omitted and filed separately with
the Commission.
<PAGE>
1.40 "Governmental Approvals" .................................. 4
1.41 "Governmental Authority" .................................. 4
1.42 "Hazardous Activity" ...................................... 5
1.43 "Hazardous Materials" ..................................... 5
1.44 "Intellectual Property" ................................... 5
1.45 "Interim Services Agreement" .............................. 6
1.46 "Interim Balance Sheets" .................................. 6
1.47 "Interim Financial Statements" ............................ 6
1.48 "Inventory Determination" ................................. 6
1.49 "Inventory" ............................................... 6
1.50 "Leased Real Property" .................................... 6
1.51 "Legal Proceeding" ........................................ 6
1.52 "Liability" ............................................... 6
1.53 "Lien" .................................................... 6
1.54 "Material Adverse Effect" ................................. 6
1.56 "Non-Competition Agreement" ............................... 6
1.57 "November Balance Sheets" ................................. 7
1.59 "Ordinary Course of Business" ............................. 7
1.60 "Paid Time Off" ........................................... 7
1.61 "Permits" ................................................. 7
1.62 "Permitted Liens" ......................................... 7
1.63 "Person" .................................................. 7
1.64 "Plans" ................................................... 7
1.65 "POS System" .............................................. 7
1.66 "Purchased Contracts" ..................................... 7
1.67 "Purchase Price" .......................................... 7
1.68 "Preliminary Statement" ................................... 7
1.69 "primarily in connection with the Business" ............... 7
1.70 "Release" ................................................. 8
1.71 "Sam's Club Agreement" .................................... 8
1.72 "Sam's Club Locations" .................................... 8
1.73 "Sublease Agreement" ...................................... 8
1.74 "Subsidiary" .............................................. 8
1.75 "Taxes" or "Tax" .......................................... 8
1.76 "Tax Return" .............................................. 8
1.77 "Threat of Release" ....................................... 8
1.78 "Trade Secrets" ........................................... 8
ARTICLE 2 -- PURCHASE AND SALE OF ACQUIRED ASSETS .......................... 9
2.1 Purchase and Sale of Acquired Assets ....................... 9
------------------------------------
2.2 Acquired Assets ............................................ 9
---------------
2.3 Inventory ................................................. 11
---------
2.4 Excluded Assets ........................................... 11
---------------
CONFIDENTIAL ii
<PAGE>
2.5 Assumption of Assumed Liabilities ........................ 12
---------------------------------
2.6 Excluded Liabilities ..................................... 12
--------------------
ARTICLE 3 -- THE CLOSING ................................................ 13
3.1 The Closing .............................................. 13
-----------
3.2 Deliveries at the Closing ................................ 13
-------------------------
3.3 Purchase Price ........................................... 14
--------------
3.4 Allocation of Purchase Price ............................. 14
----------------------------
3.5 Prorations ............................................... 14
----------
3.6 Closing Adjustment ....................................... 15
------------------
3.7 Adjustment to Purchase Price ............................. 15
----------------------------
3.8 Post Closing Payments .................................... 16
---------------------
ARTICLE 4 -- REPRESENTATIONS AND WARRANTIES OF THE SELLERS .............. 16
4.1 Organization of the Seller; No Subsidiaries .............. 16
-------------------------------------------
4.2 Authorization of Transaction ............................. 17
----------------------------
4.3 Noncontravention ......................................... 17
----------------
4.4 Governmental and Third Party Consents .................... 18
-------------------------------------
4.5 Good Title Conveyed; Binding Obligations; Etc. ........... 18
----------------------------------------------
4.6 Financial Statements ..................................... 19
--------------------
4.7 Undisclosed Liabilities .................................. 19
-----------------------
4.8 Legal Compliance; Litigation ............................. 20
----------------------------
4.9 Permits .................................................. 20
-------
4.10 Tax Matters ............................................. 20
-----------
4.11 Condition of Acquired Assets ............................ 21
----------------------------
4.12 Business Intellectual Property Rights ................... 21
-------------------------------------
4.13 Real Property ........................................... 22
-------------
4.14 Inventory ............................................... 23
---------
4.15 Contracts ............................................... 23
---------
4.16 Insurance ............................................... 24
---------
4.17 Employee Benefits ....................................... 24
-----------------
4.18 Employee Salaries ....................................... 26
-----------------
4.19 Employee Relations and Labor Matters .................... 26
------------------------------------
4.20 Environment, Health and Safety .......................... 27
------------------------------
4.21 Affiliate Transactions .................................. 27
----------------------
4.22 Entire Business ......................................... 27
---------------
4.23 Absence of Certain Changes or Events .................... 28
------------------------------------
4.24 Ability to Pay Debts .................................... 28
--------------------
4.25 Customers and Suppliers ................................. 28
-----------------------
4.26 Furniture, Fixtures, Equipment, etc. .................... 29
------------------------------------
4.27 WARN Act ................................................ 29
--------
4.28 Brokers' Fees ........................................... 29
-------------
4.29 Disclosure .............................................. 29
----------
CONFIDENTIAL iii
<PAGE>
ARTICLE 5 -- REPRESENTATIONS AND WARRANTIES OF THE BUYER .................. 29
5.1 Organization of the Buyer ................................ 29
-------------------------
5.2 Authorization of Transaction ............................. 29
----------------------------
5.3 Noncontravention ......................................... 30
----------------
5.4 Governmental Consents .................................... 30
---------------------
5.5 Brokers' Fees ............................................ 30
-------------
ARTICLE 6 -- COVENANTS OF THE PARTIES ..................................... 31
6.1 General................................................... 31
-------
6.2 Expenses ................................................. 31
--------
6.3 Public Announcements ..................................... 31
--------------------
6.4 Cooperation; Further Assurances .......................... 31
-------------------------------
6.5 Consents, Filings and Approvals .......................... 31
-------------------------------
6.6 Accuracy of Representations .............................. 32
---------------------------
6.7 Notification of Certain Matters .......................... 32
-------------------------------
6.8 Hart-Scott-Rodino......................................... 32
-----------------
6.9 Disclosure of Confidential Information ................... 33
--------------------------------------
6.10 Retention of Records ..................................... 33
--------------------
6.11 Return of Inventory....................................... 34
-------------------
6.12 Employment Matters........................................ 34
------------------
ARTICLE 7 -- COVENANTS OF THE SELLERS ..................................... 35
7.1 Conduct of Business ...................................... 35
-------------------
7.2 Access and Information ................................... 36
----------------------
7.3 Supplemental Disclosure .................................. 36
-----------------------
7.4 Exclusivity .............................................. 36
-----------
7.5 Discharge of Liabilities ................................. 36
------------------------
7.6 Employee Benefits ........................................ 37
-----------------
7.7 Noncompetition ........................................... 38
--------------
7.8 Tax Matters. ............................................. 38
-----------
7.9 Inventory. ............................................... 38
---------
ARTICLE 8 -- CONDITIONS TO OBLIGATIONS OF THE BUYER TO CLOSE .............. 38
8.1 Representations and Warranties ........................... 38
------------------------------
8.2 Compliance with Agreement ................................ 38
-------------------------
8.3 Officers' Certificates ................................... 39
----------------------
8.4 Absence of Litigation; No Violation of Statutes, etc ..... 39
----------------------------------------------------
8.5 Approval by the Board of Directors of the Sellers ........ 39
-------------------------------------------------
8.6 Governmental Approvals and Third Party Consents .......... 39
-----------------------------------------------
8.7 Other Agreements ......................................... 39
----------------
8.8 Opinion of Counsel ....................................... 40
------------------
8.9 Release of Liens ......................................... 40
----------------
CONFIDENTIAL iv
<PAGE>
8.10 Activation Contracts ..................................... 40
--------------------
8.11 Employment Matters. ...................................... 40
------------------
ARTICLE 9 -- CONDITIONS TO OBLIGATIONS OF THE SELLERS TO CLOSE ............ 40
9.1 Representations and Warranties ............................ 41
------------------------------
9.2 Compliance with Agreement ................................. 41
-------------------------
9.3 Officer's Certificates .................................... 41
----------------------
9.4 Absence of Litigation; No Violation of Statutes, etc. ..... 41
-----------------------------------------------------
9.5 Approval by the Board of Directors of the Buyer. .......... 41
-----------------------------------------------
9.6 Governmental Approvals and Third Party Consents ........... 41
-----------------------------------------------
9.7 Other Agreements. ......................................... 41
----------------
9.8 Payment of the Purchase Price ............................. 42
-----------------------------
ARTICLE 10 -- INDEMNIFICATION ............................................. 42
10.1 Indemnification .......................................... 42
---------------
10.2 Procedure ................................................ 44
---------
10.3 Third Party Claims ....................................... 44
------------------
ARTICLE 11 -- TERMINATION ................................................. 45
11.1 Termination .............................................. 46
-----------
11.2 Effect of Termination .................................... 46
---------------------
11.3 Survival. ................................................ 46
--------
ARTICLE 12 -- MISCELLANEOUS ............................................... 47
12.1 Arbitration .............................................. 47
-----------
12.2 Notices .................................................. 47
-------
12.3 Entire Agreement ......................................... 48
----------------
12.4 Expenses ................................................. 48
--------
12.5 Waiver ................................................... 48
------
12.6 Amendment ................................................ 48
---------
12.7 No Third Party Beneficiary ............................... 48
--------------------------
12.8 No Assignment, Binding Effect ............................ 49
-----------------------------
12.9 Headings ................................................. 49
--------
12.10 Schedules, Exhibits and Other Agreements ................ 49
----------------------------------------
12.11 Severability ............................................ 49
------------
12.12 Governing Law ........................................... 49
-------------
12.13 Counterparts ............................................ 49
------------
12.14 Specific Performance .................................... 49
--------------------
12.15 Construction of Certain Terms and Phrases ............... 49
-----------------------------------------
12.16 Bulk Sales Laws ......................................... 50
---------------
CONFIDENTIAL v
<PAGE>
EXHIBITS:
- ---------
Exhibit A Form of Bill of Sale
Exhibit B Allocation of Purchase Price
Exhibit C Form of Non-Competition Agreements
Exhibit D Form of Sublease Agreement
Exhibit E Form of Assignment and Assumption Agreement
Exhibit F Form of Opinion of the Sellers' General Counsel
SCHEDULES:
- ----------
Schedule 1.25 Non-Employees
Schedule 1.72 Sam's Club Locations
Schedule 2.1 Locations not being sold
Schedule 2.2(A) Fixed Assets
Schedule 2.2(B) Material Business Intellectual Property Rights
Schedule 2.2(C) Purchased Contracts
Schedule 2.2(G) Sam's Club Certificates
Schedule 2.2(H) Other Assets and properties of the Sellers
Schedule 2.3 Inventory
Schedule 2.4(H) Excluded Intellectual Property Assets
Schedule 2.5(A) Paid Time Off
Schedule 4.4 Consents and Waivers
Schedule 4.5 Liens and Encumbrances
Schedule 4.6(A) Financial Statements
Schedule 4.6(B) Interim Financial Statements
Schedule 4.7 Undisclosed Liability
Schedule 4.8 Legal Proceedings
Schedule 4.9 Permits
Schedule 4.10 Tax Matters
Schedule 4.11 Potential Defects
Schedule 4.12 Business Intellectual Property Rights Exceptions
Schedule 4.13 Leased Real Property
Schedule 4.15 Material Contracts and Agreements
Schedule 4.16 Insurance Policies
Schedule 4.17 Employee Benefit Plans
Schedule 4.18 Employee Information
Schedule 4.19 Employee Relations and Labor Matters
Schedule 4.21 Affiliate Transactions
Schedule 4.27 WARN Act
Schedule 5.4 Governmental Consents
Schedule 7.1 Amendment to Benefits Plan
CONFIDENTIAL vi
[The Company agrees to furnish supplementally a copy of any omitted schedule to
the Securities and Exchange Commission upon request.]
<PAGE>
ASSET PURCHASE AGREEMENT
THIS ASSET PURCHASE AGREEMENT ("Agreement") is made as of the 1st day of
October, 1996, by and between MCI TELECOMMUNICATIONS CORPORATION, a Delaware
corporation (the "Buyer"), and NATIONAL AUTO CENTER, INC., a Texas corporation
("NAC"), CELLSTAR, LTD., a Texas limited partnership of which NAC is the sole
general partner (the "Partnership") and CELLSTAR CORPORATION, a Delaware
corporation (the "Parent"), which directly and indirectly owns all the equity
and voting interests in the Partnership. NAC, the Partnership and the Parent
are sometimes hereinafter referred to as the "Sellers" and individually as a
"Seller". The Buyer and the Sellers are sometimes herein after referred to
collectively herein as the "Parties."
W I T N E S S E T H:
WHEREAS, the Parties have entered into that certain Letter of Intent,
dated August 6, 1996, relating to the sale of certain assets held by the Sellers
to the Buyer;
WHEREAS, pursuant to the terms and subject to the conditions set forth in
this Agreement, the Sellers desire to sell and the Buyer desires to purchase
certain of the assets of the Sellers relating to the Business (as defined
herein) as set forth specifically herein; and
WHEREAS, the Parties desire to enter into certain other agreements and
arrangements in connection with the purchase of such assets.
NOW, THEREFORE, in consideration of the premises and the mutual covenants
and agreements hereinafter set forth, and in consideration of the
representations, warranties, and covenants herein contained, the Parties hereby
agree as follows:
ARTICLE 1 -- DEFINITIONS
The following capitalized terms shall have the meanings set forth below.
1.1 "Acquired Assets" shall have the meaning set forth in
Section 2.2 below.
1.2 "Accord" shall have the meaning set forth in Section 6.5.(B) below.
1.3 "Activation Contracts" shall have the meaning set forth in
Section 2.2 below.
1.4 "Advertising Allowance" shall have the meaning set forth in
Section 2.2.(G) below.
CONFIDENTIAL
<PAGE>
1.5 "Affiliate" shall mean, with respect to a particular Person, another
Person or entity, that directly or indirectly through one or more intermediaries
controls, is controlled by, or is under common control with the particular
Person. For purposes hereof, the term "control" means the possession, directly
or indirectly, of the power to direct or cause the direction of the management
and policies of a Person, whether through ownership of voting securities, by
contract or otherwise.
1.6 "Assets Determination" shall have the meaning set forth in
Section 3.6 below.
1.7 "Assumed Liabilities" shall have the meaning set forth in
Section 2.5 below.
1.8 "AT&T Contract" shall have the meaning set forth in Section 8.10
below.
1.9 "AT&T Locations" shall have the meaning set forth in Section 8.10
below.
1.10 "Best Efforts" means the reasonable efforts that a prudent Person
desirous of achieving a result would use in similar circumstances to ensure that
such result is achieved as expeditiously as possible.
1.11 "Bill of Sale" shall have the meaning set forth in Section 2.2 below.
1.12 "Book Value" of the Fixed Assets, other than the kiosks, shall mean
the book value computed in accordance with GAAP, and the "Book Value" of the
kiosks shall mean the book value of the kiosks computed in accordance with GAAP
before reductions for payments made by cellular companies or others.
1.13 "Business" means the business of the Sellers at kiosks located within
the Sam's Club Locations located within the continental United States, Alaska
and Hawaii, relating to the retail sale of wireless communications equipment,
including but not limited to, cellular telephone equipment and accessories, and
the sale and activation of wireless telephone services, but specifically
excluding Seller's paging business and customer base.
1.14 "Business Employees" shall have the meaning set forth in Section 8.11
below.
1.15 "Business Intellectual Property Rights" shall have the meaning set
forth in Section 2.2.(B) below.
1.16 "Code" means the Internal Revenue Code of 1986, as amended, and the
rules and regulations promulgated thereunder.
1.17 [REDACTED]
CONFIDENTIAL 2
- -------------------------
Brackets ([/]) indicate confidential portions omitted and filed separately with
the Commission.
<PAGE>
1.18 "Contracts" shall have the meaning set forth in Section 4.15 below.
1.19 "Closing" shall have the meaning set forth in Section 3.1 below.
1.20 "Closing Date" shall have the meaning set forth in Section 3.1 below.
1.21 "Closing Amount" shall have the meaning set forth in Section 3.3
below.
1.22 "Confidential Information" shall mean collectively, (i) any and all
"Confidential Information" exchanged by the Parties pursuant to the Confidential
Disclosure Agreement, dated February 23, 1996, between Parent and MCI
Communications Corporation, as such term is defined therein; and (ii) all
information relating to or concerning the Business, the Acquired Assets or the
Inventory or otherwise disclosed by the Parties in connection with the
transactions contemplated by this Agreement (which includes historical financial
statements, financial projections and budgets, historical and projected sales,
capital spending budgets and plans, the names and backgrounds of key personnel,
personnel training and techniques and materials), and that should reasonably
have been understood by the receiving party, because of legends or other
markings, the circumstances of disclosure or the nature of the information
itself, to be proprietary and confidential to the disclosing party or its
Affiliates or to a third party. Confidential Information may be disclosed in
written or other tangible form (including on magnetic media) or by oral, visual
or other means.
1.23 "Consents" shall have the meaning set forth in Section 6.5.(A) below.
1.24 "Distribution Agreement" shall have the meaning set forth in Section
8.7.(A) below.
1.25 "Employees" shall mean the full time and part time employees of the
Sellers' whose primary work responsibilities relate to the operations of the
Business, but not including those employees of the Sellers included on
Schedule 1.25.
- -------------
1.26 "Employment Loss" means (a) an employment termination, other than a
discharge for cause, voluntary departure, or retirement, (b) a layoff exceeding
six (6) months or (c) a reduction in hours of work of more than fifty percent
(50%).
1.27 "Encumbrance" means any charge, claim, community property interest,
condition, equitable interest, lien, option, pledge, security interest, right of
first refusal, or restriction of any kind, including any restriction on use,
voting, transfer, receipt of income, or exercise of any other attribute of
ownership.
1.28 "Environment" means soil, land surface or subsurface strata, surface
waters (including navigable waters, ocean waters, streams, ponds, drainage
basins, and wetlands), groundwaters, drinking water supply, stream sediments,
ambient air (including indoor air), plant and animal life, and any other
environmental medium or natural resource.
CONFIDENTIAL 3
<PAGE>
1.29 "Environmental, Health, and Safety Laws" means all laws (including
rules, regulations, codes, plans, injunctions, judgments, orders, decrees,
rulings, and charges thereunder) of federal, state and local governments (and
all agencies thereof) concerning pollution or protection of the environment,
public health and safety, or employee health and safety, including laws relating
to conditions, emissions, discharges, releases, or threatened releases of
pollutants, contaminants, or chemical, industrial, hazardous, or toxic materials
or wastes into ambient air, surface water, ground water, or lands or otherwise
relating to the manufacture, processing, distribution, use, treatment, storage,
disposal, transport, or handling of pollutants, contaminants, or chemical,
industrial, hazardous, or toxic materials or wastes.
1.30 "ERISA" shall have the meaning set forth in Section 4.17.(A) below.
1.31 "ERISA Plans" shall have the meaning set forth in Section 4.17.(A)
below.
1.32 "Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
1.33 "Excluded Assets" shall have the meaning set forth in Section 2.4
below.
1.34 "Excluded Agreements" shall have the meaning set forth in Section
2.4.(F) below.
1.35 "Facilities" mean any real property, leaseholds, or other interests
currently owned or operated by the Sellers and used primarily in connection with
the Business and any buildings, plants, structures, or equipment (including
motor vehicles, tank cars, and rolling stock) currently owned or operated by the
Sellers and used primarily in connection with the Business.
1.36 "Final Statement" shall have the meaning set forth in Section 3.6
below.
1.37 "Financial Statements" shall have the meaning set forth in Section
4.6.(A) below.
1.38 "Fixed Assets" shall have the meaning set forth in Section 2.2.(A)
below.
1.39 "GAAP" means generally accepted United States accounting principles
as they may be modified from time to time.
1.40 "Governmental Approvals" shall have the meaning set forth in Section
6.5 below.
1.41 "Governmental Authority" means any:
(A) nation, state, county, city, town, village, district or other
jurisdiction of any nature;
(B) federal, state, local municipal or other government;
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<PAGE>
(C) governmental or quasi-governmental authority of any nature
(including any governmental agency, branch, department, official or entity
and any court or other tribunal);
(D) multi-national organization or body; or
(E) body exercising or entitled to exercise any administrative,
executive, judicial, legislative, police, regulatory or taxing authority or
power of any nature.
1.42 "Hazardous Activity" means the distribution, generation, handling,
importing, management, manufacturing, processing, production, refinement,
Release, storage, transfer, transportation, treatment, or use (including any
withdrawal or other use of groundwater) of Hazardous Materials in, on, under,
about, or from the Facilities or any part thereof into the Environment, and any
other act, business, operation, or thing that increases the danger, or risk of
danger, or poses an unreasonable risk of harm to persons or property on or off
the Facilities, or that may affect the value of the Facilities or the Business.
1.43 "Hazardous Materials" mean any waste or other substance that is
listed, defined, designated, or classified as, or otherwise determined to be,
hazardous, radioactive, or toxic or a pollutant or a contaminant under or
pursuant to any Environmental, Health and Safety Law, including any admixture or
solution thereof, and specifically including petroleum and all derivatives
thereof or synthetic substitutes therefor and asbestos or asbestos-containing
materials.
1.44 "Intellectual Property" means:
(A) all inventions (whether patentable or unpatentable and whether
or not reduced to practice), all improvements thereto, and all patents,
patent applications, and patent disclosures, together with all reissuances,
continuations, continuations-in-part, revisions, extensions, and
reexaminations thereof;
(B) all trademarks, service marks, trade dress, logos, trade names,
and corporate names, together with all translations, adaptations,
derivations, and combinations thereof and including all goodwill associated
therewith, and all applications, registrations, and renewals in connection
therewith;
(C) all copyrightable works, all copyrights, and all applications,
registrations, and renewals in connection therewith;
(D) all mask works and all applications, registrations, and renewals
in connection therewith;
(E) all trade secrets and confidential business information
(including, but not limited to, ideas, research and development, know-how,
formulas, patterns, devices, compilations, methods, compositions,
manufacturing and production processes and techniques, technical
CONFIDENTIAL 5
<PAGE>
data, designs, drawings, specifications, customer and supplier lists, pricing
and cost information, and business and marketing plans, studies, proposals and
data)(collectively, the "Trade Secrets");
(F) all computer and other software (including data and related
documentation);
(G) all other proprietary rights; and
(H) all copies and tangible embodiments of any of the foregoing (in
whatever form or medium).
1.45 "Interim Services Agreement" shall have the meaning set forth in
Section 8.7.(E) below.
1.46 "Interim Balance Sheets" shall have the meaning set forth in Section
4.7 below.
1.47 "Interim Financial Statements" shall have the meaning set forth in
Section 4.6.(B) below.
1.48 "Inventory Determination" shall have the meaning set forth in Section
3.6 below.
1.49 "Inventory" shall have the meaning set forth in Section 2.3 below.
1.50 "Leased Real Property" shall have the meaning set forth in Section
4.13 below.
1.51 "Legal Proceeding" means any action, suit, proceeding, hearing,
investigation, charge, complaint, demand or notice.
1.52 "Liability" means any liability (whether known or unknown, whether
asserted or unasserted, whether absolute or contingent, whether accrued or
unaccrued, whether liquidated or unliquidated, and whether due or to become
due), including any liability for Taxes.
1.53 "Lien" shall mean any mortgage, chattel mortgage, conditional sales
contract, pledge, lien, charge, encumbrance, restriction, option, lease,
license, easement, or adverse claim of any nature whatsoever, direct or
indirect, whether accrued, absolute, contingent or otherwise.
1.54 "Material Adverse Effect" means a material adverse change in, or a
material adverse effect upon, the assets, properties, financial or other
condition, operations, or results of operations of the Business.
1.55 "Microstep POS" means the point-of-sale system developed by the
Sellers and Larry R. Pettit, P.C. and used in the Business.
1.56 "Non-Competition Agreement" shall have the meaning set forth in
Section 7.7 below.
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<PAGE>
1.57 "November Balance Sheets" shall have the meaning set forth in Section
4.6.(A) below.
1.58 "Option Agreement" shall have the meaning set forth in Section 8.10
below.
1.59 "Ordinary Course of Business" shall have the following meaning: an
action taken by a Person will be deemed to have been taken in the "Ordinary
Course of Business" only if:
(A) such action is consistent with the past practices of such Person
and is taken in the ordinary course of the normal day-to-day operations of
such Person;
(B) such action is not required to be authorized by the board of
directors of such Person (or by any Person or group of Persons exercising
similar authority); and
(C) such action is similar in nature and magnitude to actions
customarily taken, without any authorization by the board of directors (or
by any Person or group of Persons exercising similar authority), in the
ordinary course of the normal day-to-day operations of other Persons that
are in the same line of business as such Person.
1.60 "Paid Time Off" shall have the meaning set forth in Section 2.5.(A)
below.
1.61 "Permits" shall have the meaning set forth in Section 4.9 below.
1.62 "Permitted Liens" means Liens that do not individually or in the
aggregate materially impair the value or use of the asset to which they relate
or the operation of the Business.
1.63 "Person" means an individual, a general or limited partnership, a
corporation, an association, a joint stock company, a limited liability company,
an estate, a labor union, a trust, a joint venture, an unincorporated
organization, or a governmental entity (or any department, agency, or political
subdivision thereof).
1.64 "Plans" shall have the meaning set forth in Section 4.17.(A) below.
1.65 "POS System" means retail point-of-sale system developed by the
Sellers and Progress as developed through the Closing Date.
1.66 "Purchased Contracts" shall have the meaning set forth in Section
2.2.(C) below.
1.67 "Purchase Price" shall have the meaning set forth in Section 3.3
below.
1.68 "Preliminary Statement" shall have the meaning set forth in Section
3.5 below.
1.69 "primarily in connection with the Business" and "primarily used in
connection with the Business" shall mean (i) with respect to an item or service,
those items or services whose primary use
CONFIDENTIAL 7
<PAGE>
(i.e. 80% or greater use) relates to the Business, or (ii) with respect to an
individual, those individuals whose primary work responsibilities (i.e. 80% or
greater) relate to the Business.
1.70 "Release" means any spilling, leaking, emitting, discharging,
depositing, escaping, leaching, dumping, or other releasing into the
Environment, whether intentional or unintentional.
1.71 "Sam's Club Agreement" shall have the meaning set forth in Section
8.7.(C) below.
1.72 "Sam's Club Locations" shall mean the stores of Wal-Mart Stores, Inc.
d/b/a "Sam's Club" in which the Sellers currently are conducting the Business
and which are set forth on Schedule 1.72.
--------------
1.73 "Sublease Agreement" shall have the meaning set forth in Section
8.7.(D) below.
1.74 "Subsidiary" means any corporation, association, partnership, limited
liability company, joint venture or other business entity with respect to which
a specified Person (through or with one or more subsidiaries of such Person)
owns or otherwise controls, either directly or indirectly, a majority of the
voting stock, membership interests or other equity interests (in the case of
Persons other than corporations) or has the power to vote or direct the voting
of sufficient securities to elect a majority of the directors, members, or
general partners, as the case may be.
1.75 "Taxes" or "Tax" are defined to include all net income, capital
gains, gross income, gross receipts, sales, use, transfer, ad valorem,
franchise, profits, license, withholding, payroll, employment, workers'
compensation, excise, severance, stamp, occupation, premium, property, or
windfall profit taxes, environmental (including taxes under Code Section 59A),
customs duties, social security (or similar), unemployment, disability,
registration, value added, alternative or add-on minimum, estimated payments,
estimated taxes, or other taxes, fees, levies, assessments, or charges of any
kind whatsoever, together with any interest and any penalties, additions to tax,
or additional amounts imposed by the United States or any other jurisdiction in
which the Seller conducts activities or is subject to taxing jurisdiction, and
any state, province, county, local or other government, taxing authority, or
subdivision thereof.
1.76 "Tax Return" means any return, report, information return,
declaration, statement or other document (including any related or supporting
information) filed or required to be filed with any governmental entity or other
authority in connection with the determination, assessment or collection of any
Tax (whether or not such Tax is imposed on the Seller) or the administration of
any law, regulations or administrative requirements relating to any Tax.
1.77 "Threat of Release" means a substantial likelihood of a Release that
may require action in order to prevent or mitigate damage to the Environment
that may result from such Release.
1.78 "Trade Secrets" shall have the meaning set forth in Section 1.44
above.
CONFIDENTIAL 8
<PAGE>
ARTICLE 2 -- PURCHASE AND SALE OF ACQUIRED ASSETS
2.1 Purchase and Sale of Acquired Assets. Subject to the terms and
------------------------------------
conditions of this Agreement, at the Closing (as hereinafter defined) the
Sellers shall sell, transfer, convey, assign and deliver to the Buyer and the
Buyer shall purchase, acquire and accept from the Sellers all of the Acquired
Assets (as hereinafter defined), other than the Inventory (as herein defined)
and the Fixed Assets related to the Sam's Club Locations set forth in Schedule
--------
2.1, which schedule shall be prepared by the Buyer at least five days prior to
- ---
the Closing provided for in Section 3.1 for the considerations specified below
in Section 3.3.
2.2 Acquired Assets. Subject to Section 2.4 hereof respecting Excluded
---------------
Assets (which shall not be Acquired Assets), the "Acquired Assets" shall mean
any and all of the rights, properties, assets, claims, and contracts of every
kind, character and description, whether tangible or intangible, whether real,
personal or mixed, and wherever located, of the Sellers which are used primarily
in the Business, including but not limited to the following to the extent used
primarily in the Business:
(A) all tangible personal property (whether owned, or for which
there are rights under any lease or other arrangement), including without
limitation, all machinery, computer and other equipment and furniture,
including, without limitation, the tangible personal property related to
the Microstep POS System and those described on Schedule 2.2(A)
---------------
(collectively, the "Fixed Assets");
(B) all Intellectual Property, as to which any Seller has any right,
title or interest (including any rights under franchises, licenses,
sublicenses, contracts, agreements), goodwill associated therewith,
licenses and sublicenses granted and obtained with respect thereto, and
rights thereunder, remedies against infringements thereof, and rights to
protection of interests therein under the laws of all jurisdictions,
including, without limitation, those described on Schedule 2.2(B)
---------------
(collectively, the "Business Intellectual Property Rights");
(C) all agreements, commitments, undertakings, contracts,
indentures, mortgages, instruments, Liens, Encumbrances, guaranties, or
other similar arrangements whether oral or written, identified on
Schedule 2.2(C) and all rights thereunder (collectively, the "Purchased
---------------
Contracts");
(D) all claims and rights of every kind relating to the Acquired
Assets, including without limitation, deposits, prepayments, refunds, all
causes of action, chooses in action, rights of recovery, rights of set off,
and rights of recoupment (including any such item relating to the payment
of Taxes for periods following the Closing);
(E) to the extent transferable, franchises, approvals, permits,
licenses, orders, registrations, certificates, variances, and similar
rights obtained from any federal, state, local
CONFIDENTIAL 9
<PAGE>
or foreign governmental entity, authority, department, commissioner, board,
bureau, agency court or instrumentality;
(F) except for information that is subject to the attorney-client
work privilege, all operating data and business records, including without
limitation, all books, records, ledgers, files, documents, correspondence,
cost and pricing information for customers of the Business, business plans,
reference catalogs, plats, architectural plans, drawings, and
specifications, creative materials, advertising and promotional materials
to the extent transferable, studies, reports, and other printed or written
materials;
(G) the Sam's Club gift certificates that do not have expiration
dates, a recent listing of which are set forth on Schedule 2.2(G)
---------------
(collectively, the "Advertising Allowance");
(H) All other assets and properties of the Sellers identified on
Schedule 2.2(H) hereto; and
---------------
(I) A license to use "Communication Center" and "Communications
Center Affiliates" in stylized version during the term of the Interim
Services Agreement.
The Sellers will assign and transfer to the Buyer all of the Sellers'
right, title and interest in and to the Acquired Assets by delivery of (i) a
bill of sale in substantially the form set forth as Exhibit A hereto (the "Bill
---------
of Sale"), duly executed by the Sellers, and (ii) such other good and sufficient
instruments of conveyance, assignment and transfer, as may reasonably be
requested by the Buyer, as shall be effective to vest in the Buyer all of the
Sellers' right, title and interest in, to and under the Acquired Assets (the
"General Conveyance").
To the extent that any material contract or license identified in Section
2.2 above is not assignable without the consent of a third party, this Agreement
shall not constitute an assignment or an attempted assignment thereof if such
assignment or attempted assignment would constitute a breach thereof. The
Sellers and the Buyer shall use their Best Efforts to obtain the consent of such
other party to the assignment of any such contract or license to the Buyer in
all cases in which such consent is or may be required for such assignment. If
any such consent shall not be obtained, the Buyer shall cooperate with the
Sellers in concluding any other mutually agreeable arrangement (including,
without limitation, entering into sub-contracting) designed to allow the Buyer,
or the Sellers on the Buyer's account, to offer cellular services in all of the
Sam's Club Locations (collectively with the Purchased Contracts that are
assigned to the Buyer, the "Activation Contracts").
Without limitation as to the preceding paragraph, the Parties shall use
their Best Efforts to enter into, and shall cooperate with each other in good
faith in entering into, appropriate, reasonable transitional arrangements, on
terms mutually agreeable, with respect to any contract or license to which a
Seller is a party and which is utilized in the conduct of the Business and which
is not, by its terms, assignable (in whole or in part) by the Sellers or under
which Sellers may not assign its
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<PAGE>
obligations or delegate its duties. In connection with any such transitional
arrangement, the Buyer shall cooperate with the Sellers in good faith, in
seeking to have Sellers released from its obligations under any such contract or
license.
2.3 Inventory. "Inventory" shall mean all inventories present in the
---------
Sam's Club Locations and used in connection with, or relating to the conduct of,
the Business on the Closing Date, including without limitation, finished goods
and goods in transit from the Sellers to the Sam's Club Locations used or
intended for use or held for sale, but excluding the Seller's inventory of non-
PageNet pagers. Schedule 2.3 lists of all of the Sellers' inventory used in
------------
connection with, or relating to the conduct of, the Business as of July 31,
1996. The Sellers will assign and transfer to Buyer all of Sellers' right,
title and interest in and to the Inventory by delivery of a Bill of Sale.
2.4 Excluded Assets. Notwithstanding anything contained in Section 2.2 to
---------------
the contrary, the Acquired Assets shall not include any of the following (the
"Excluded Assets"):
(A) All of the Sellers' cash on hand or on deposit as of the Closing
Date;
(B) The Sellers' corporate books and records, including the
corporate charter and bylaws, qualifications to conduct business as a
foreign corporation, corporate seals, minute books, stock transfer books,
and other documents relating to the organization, maintenance, and
existence of the Sellers as corporations and a limited partnership,
respectively;
(C) Any and all employment agreements, contracts or other
understandings, whether written or oral, to which Sellers are a party,
relating to employment by the Sellers of any Person;
(D) Any loss, liability, cost or expense related to the Sellers'
failure to pay or discharge any claims or creditors that could be asserted
against the Buyer in connection with the bulk sales laws of the applicable
jurisdictions;
(E) All accounts receivable, other than the Advertising Allowance,
and notes, and other receivables and any security arrangements and
collateral securing the repayment or other satisfaction of such accounts
receivable and notes, and other receivables;
(F) All agreements, commitments, contracts or similar arrangements
and all rights thereunder, of the Sellers (i) related solely to the paging
business, (ii) not included in the Purchased Contracts and (iii) not
otherwise provided for herein, including, but not limited to, all
agreements, commitments, contracts or similar arrangements and all rights
thereunder primarily related to the Seller's paging customers (the
"Excluded Agreements");
(G) Customer lists, credit information, the Sellers' accounting
records and supplier pricing information; and
CONFIDENTIAL 11
<PAGE>
(H) All assets, property, rights and claims of the Sellers (i)
related solely to the paging business, except for the PageNet pagers
included in the Inventory, (ii) not included in the Acquired Assets or the
Inventory and (iii) not otherwise provided for herein, including, but not
limited to, the Seller's paging customers and the excluded intellectual
property assets set forth on Schedule 2.4(H) hereto; provided, however,
--------------- -------- -------
that nothing in this Agreement shall preclude the Buyer from using any
generic, descriptive or disclaimed term contained in the trademarks listed
in Schedule 2.2(B) or Schedule 2.4(H), except for the trademarks listed
--------------- ---------------
therein in their entireties.
2.5 Assumption of Assumed Liabilities. Subject to Section 2.6 below and
---------------------------------
the terms and conditions of this Agreement, upon the transfer of the Acquired
Assets at the Closing, the Buyer agrees to assume the Assumed Liabilities (as
hereinafter defined), but only those and no others. The Liabilities of the
Sellers to be transferred and assumed by the Buyer (the "Assumed Liabilities")
shall mean and consist solely of certain Liabilities of the Seller relating to
the Acquired Assets, which are strictly limited to:
(A) the actual costs incurred by the Sellers for the payment of the
paid time off of the Employees (as hereinafter defined) on the Closing Date
(the "Paid Time Off"), estimates of which amounts are set forth on Schedule
--------
2.5(A); provided, however, that the Buyer shall not be obligated to
------ -------- -------
reimburse the Sellers for more than an aggregate of Three Hundred Thousand
Dollars ($300,000) in Paid Time Off; provided, further that the Sellers
-------- -------
shall reimburse the Buyer for any payments made to Employees, pursuant to
this Section 2.5(A), who are reemployed by the Seller's within six (6)
months of the Closing Date; and
(B) all Liabilities and obligations of the Sellers arising from and
after the Closing Date under the Activation Contracts or otherwise related
to the operation of the Business or the ownership of the Acquired Assets,
but only to the extent such Liabilities and obligations do not relate to
any default or breach which has occurred on or prior to the Closing Date.
2.6 Excluded Liabilities. Except as expressly set forth in Section 2.5
---------------------
hereof, the Buyer does not assume and shall not be deemed to have assumed or be
responsible for any Liabilities of the Sellers. Without limiting the foregoing
in any manner, the Assumed Liabilities do not include any of the following
Liabilities and obligations of the Sellers, and the Sellers will promptly pay
and perform and hold the Buyer harmless from and against:
(A) any Liability or obligation relating to the Excluded Assets;
(B) any Liability or obligation of the Sellers or any of their
Affiliates in respect of any Taxes or any reporting requirement or
estimated Tax payable with respect thereto relating to events or
transactions occurring on or prior to the Closing Date, or any Liability
for any property taxes for the tax year that includes the Closing Date,
involving the Sellers or any of their Affiliates, the Business or the
Acquired Assets, the transactions contemplated hereby,
CONFIDENTIAL 12
<PAGE>
in whole or in part, or relating to the inclusion of any Affiliate of the
Seller in a consolidated tax group or tax sharing arrangement with the
Sellers or their Affiliates;
(C) any Liability, claim or obligation relating to any Legal
Proceeding arising from or relating to the Business, the Acquired Assets,
the Inventory or other events or conditions occurring or existing prior to
or on the Closing Date (including any warranty claim);
(D) any Liability to any Employee or independent contractor or
subcontractor of the Sellers or any other Person for termination pay or
pension or other obligation in connection with the transactions that are
the subject of this Agreement or otherwise, or for termination pay or
pension or other obligations to former Employees or independent contractors
or subcontractors of the Sellers or any other Person or otherwise
pertaining to the Acquired Assets and attributable to employment or
services provided prior to the Closing;
(E) any Liability of Sellers for accounts payable due or owed by the
Sellers or any of their respective Affiliates;
(F) any Liability relating to the Excluded Agreements or the
operations of the Sellers not strictly relating to the operation of the
Business.
ARTICLE 3 -- THE CLOSING
3.1 The Closing. The closing of the transactions contemplated by this
-----------
Agreement (the "Closing") shall take place at the offices of Sellers located at
1730 Briercroft Court, Carrollton Texas, commencing at 10:00 a.m. (Dallas, Texas
time) on the fifth business day following the satisfaction or waiver of all
conditions to the obligations of the Parties to consummate the transactions
contemplated hereby (other than conditions with respect to actions the
respective Parties will take at the Closing itself) or such other date as the
Parties may mutually determine (the "Closing Date"). The Closing shall be deemed
to have occurred at 11:59 p.m. (Dallas, Texas time) on the Closing Date.
3.2 Deliveries at the Closing. At the Closing: (i) the Sellers will
-------------------------
deliver to the Buyer the various certificates, instruments, and documents
referred to in Article 8; (ii) the Buyer will deliver to the Sellers the various
certificates, instruments, and documents referred to in Article 9 below; (iii)
the Sellers will execute, acknowledge (if appropriate), and deliver to the Buyer
any and all assignments (including contracts, real property and Intellectual
Property transfer documents) and such other instruments of sale, transfer,
conveyance, and assignment as the Buyer and its counsel may reasonably request;
and (iv) the Buyer will deliver to the Sellers the consideration specified in
Section 3.3.
CONFIDENTIAL 13
<PAGE>
3.3 Purchase Price. Subject to the adjustments described in Sections 3.5,
--------------
3.6 and 3.7, the Buyer agrees to pay to the Sellers the aggregate amount equal
to Seventeen Million Two Hundred Forty-One Thousand Six Dollars ($17,241,006) of
which (i) Eight Million Eighty-Four Thousand Nine Hundred Seven Dollars
($8,084,907) shall be paid for the Acquired Assets, other than the Advertising
Allowance, and the non-competition agreement contained in Section 7.7 hereof,
(ii) Eight Million Seven Hundred Thirteen Thousand Five Hundred Sixty-Seven
Dollars ($8,713,567) shall be paid for the Inventory, (iii) Three Hundred
Thousand Dollars ($300,000) shall be paid for Paid Time Off, and (iv) One
Hundred Forty-Two Thousand Five Hundred Thirty-Two Dollars ($142,532) will be
paid for the Advertising Allowance (collectively, the "Purchase Price"). On the
Closing Date the Buyer shall pay to the Sellers the Purchase Price less product
of (x) the number of Sam's Club Locations not being acquired on the Closing
Date, as set forth on Schedule 2.1, and (y) Twenty Thousand Dollars ($20,000)
------------
(collectively, the "Closing Amount"). The Closing Amount shall be paid in
immediately available funds via wire transfer to such account as Sellers may
reasonably direct by written notice delivered to the Buyer at least three (3)
business days prior to the Closing Date.
3.4 Allocation of Purchase Price. The Purchase Price shall be allocated
----------------------------
among the Inventory, the Acquired Assets and the noncompetition agreement
contained in Section 7.7 hereof in the manner set forth on Exhibit B attached
hereto. Such allocation of the Purchase Price shall be conclusive and binding
on the Parties for purposes of their federal, and where applicable, state and
local income tax returns, and the Parties agree not to take positions on any Tax
Returns inconsistent with such allocation. The Parties shall prepare and timely
file all such reports and returns as may be required by Section 1060 of the Code
to report such allocation of the Purchase Price.
3.5 Prorations. Utility charges, rental payments and charges and similar
----------
proratable items which are attributable to the Inventory and the Acquired Assets
shall be apportioned between the Buyer, on the one hand, and the Sellers, on the
other hand, as of the Closing Date. Any item which relates to the period prior
to or on the Closing Date shall be apportioned to the Sellers, and any such item
which relates to the period after the Closing Date shall be apportioned to the
Buyer. Notwithstanding the foregoing, the Sellers shall be responsible for any
property taxes on the Inventory and the Acquired Assets for the tax year
including the Closing Date. The Sellers shall, no later than five days prior to
the Closing Date, prepare a preliminary statement (the "Preliminary Statement")
in writing of the amount of the adjustments to be made hereunder and to be
included in the Purchase Price adjustment made pursuant to Section 3.7. The
Preliminary Statement shall be certified by the Sellers' Chief Financial Officer
as true and correct and as having been prepared in accordance with the Sellers'
books and records. The Purchase Price to be paid at Closing shall be adjusted
either upward or downward, as applicable, based on the amount of such
Preliminary Statement; provided, however, that if any upward adjustment to the
-------- -------
Purchase Price would be in excess of Twenty-Five Thousand Dollars ($25,000), the
Buyer shall not pay such adjustment unless and until the Buyer shall have
verified and agreed to the amount of such upward adjustment, which verification
and agreement shall be made no later than five days prior to the Closing Date.
If the Buyer fails to so agree with any item in the Preliminary Statement
prepared by the Seller, then any items on which the Buyer has so failed to agree
shall remain open and be determined in conjunction with the preparation of the
Final Statement (as hereinafter defined).
CONFIDENTIAL 14
<PAGE>
3.6 Closing Adjustment. As soon as practical, but in any event within
------------------
thirty (30) days following the Closing, the Buyer shall prepare and deliver to
the Sellers a determination (the "Assets Determination") comparing (i) the Book
Value, as of July 31, 1996, of the Fixed Assets estimated to be transferred on
the Closing Date, which Fixed Assets and Book Values are set forth in Schedule
--------
2.2(A) hereto, with the Book Value, as of July 31, 1996, of the Fixed Assets
- ------
transferred on the Closing Date, (ii) the estimated Advertising Allowance set
forth on Schedule 2.2(G) with the actual Advertising Allowance on the Closing
--------------
Date, and (iii) the estimated amount paid in Paid Time Off set forth on Schedule
--------
2.5(A) with the actual amount paid at the Closing for Paid Time Off. The
- -----
Sellers shall notify the Buyer in writing of any disputed items contained in the
Assets Determination within thirty (30) days from its delivery, and after such
date all undisputed items shall be deemed accepted by Seller and made part of
the final determination of the adjustment, if any, to be made to the Purchase
Price (the "Final Statement").
As soon as practical, but in any event within thirty (30) days following
the Closing, the Sellers shall prepare and deliver to the Buyer an inventory
determination (the "Inventory Determination") comparing the cost of the
Inventory as of July 31, 1996, which is set forth in Schedule 2.3 hereto, with
------------
the actual cost (including the actual and reasonable freight and handling costs
associated with acquiring and delivering the Inventory to the Sam's Club
Locations) of the Inventory transferred on the Closing. The Sellers and the
Buyer may each conduct their own physical count of the Inventory transferred on
the Closing Date. The Buyer shall notify the Sellers in writing of any disputed
items contained in the Inventory Determination within thirty (30) days from its
delivery, and after such date all undisputed items shall be deemed accepted by
the Buyer and made part of the Final Statement.
In the event that the Sellers and the Buyer are unable to agree upon
disputed items within thirty (30) days after the Buyer's notification thereof,
then the amount of the disputed items shall be determined by the accounting firm
of Price Waterhouse LLP, or such other firm selected by the Buyer within fifteen
days after the end of such thirty day period. The disputed items shall be
submitted to the selected accounting firm within thirty days after such
accounting firm is selected. The determination by such accounting firm shall be
conclusive and binding on all parties, shall be made within sixty days after
such disputed items are so submitted and shall be made a part of the Final
Statement. The Buyer shall pay all of the fees and expenses of the accounting
firm settling any disputed items on the Final Statement.
3.7 Adjustment to Purchase Price. In the event the Final Statement
----------------------------
reflects an increase in the actual cost of the Inventory, the aggregate Book
Value of the Fixed Assets, the amount paid in Paid Time Off or the Advertising
Allowance, the Purchase Price shall be adjusted upward (i) on a dollar for
dollar basis for any increase in the cost of Inventory, Book Value of the Fixed
Assets, or amount paid in Paid Time Off, and (ii) one dollar for every two
dollar increase in Advertising Allowance. In the event that the Final Statement
reflects a decrease in the actual cost of the Inventory, the aggregate Book
Value of the Fixed Assets, the amount paid in Paid Time Off or the Advertising
Allowance, the Purchase Price shall be adjusted downward (i) on a dollar for
dollar basis for any decrease in the cost of Inventory, Book Value of the Fixed
Assets, or amount paid in Paid Time Off, and (ii) one dollar for every two
dollar decrease in Advertising Allowance. If such adjustments result in a
balance due
CONFIDENTIAL 15
<PAGE>
the Sellers (after taking into account the amount of the upward or downward
adjustment to the Purchase Price made based on the Preliminary Statement), the
Buyer shall pay such balance to the Parent within fifteen days after the date of
determination of the Final Statement; provided, however, that in no event shall
-------- -------
the Buyer be obligated to pay in the aggregate more than One Hundred Fifty
Thousand Dollars ($150,000) for any Purchase Price adjustments resulting from an
increase in the aggregate Book Value as of July 31, 1996, of the Fixed Assets
transferred on the Closing Date. If such adjustment results in a balance due
the Buyer (after taking into account the amount of the upward or downward
adjustment to the Purchase Price made based on the Preliminary Statement), the
Sellers shall pay such balance to the Buyer within fifteen (15) days after the
date of determination of the Final Statement.
3.8 Post Closing Payments. The Buyer and the Sellers acknowledge and
---------------------
agree that the Buyer shall establish a new Agent ID with respect to each
cellular service agreement assumed. Except for the Assumed Liabilities, the
Sellers will retain and discharge in a timely manner all bills, obligations,
indebtedness or other liabilities (including without limitation chargeback,
return and warranty obligations) due, accrued or incurred in connection with the
ownership of the Acquired Assets or the operation and/or maintenance of the
Acquired Assets and the Business for the period prior to and including the
Closing Date and the Buyer shall be responsible for all bills, obligations,
indebtedness or other liabilities (including without limitation chargeback,
return and warranty obligations) due, accrued or incurred in connection with the
ownership of the Acquired Assets or the operation and/or maintenance of the
Acquired Assets and the Business for the period subsequent to the Closing Date.
If at any time the Buyer receives any consideration for a receivable of the
Seller for the period prior to the Closing or the Sellers receive any
consideration on any receivable of the Buyer, the recipient shall forward such
receipts to the appropriate party on a weekly basis. In addition, after the
Closing Date, (i) if invoices are received by the Buyer that are the
responsibility of the Sellers hereunder, the Buyer will accumulate and deliver
such invoices to the Sellers on a weekly basis for payment by the Seller, and
(ii) if invoices are received by the Sellers that are the responsibility of the
Buyer hereunder, the Sellers will accumulate and deliver such invoices to the
Buyer on a weekly basis for payment.
ARTICLE 4 -- REPRESENTATIONS AND WARRANTIES OF THE SELLERS
The Sellers, jointly and severally, represent and warrant to the Buyer that
the following matters are correct and complete as of the date hereof and will
also be correct and complete as of the Closing:
4.1 Organization of the Seller; No Subsidiaries. NAC is a corporation
-------------------------------------------
duly incorporated, validly existing, and in good standing under the laws of the
State of Texas; the Parent is a corporation duly incorporated, validly existing,
and in good standing under the laws of the State of Delaware; and the
Partnership is a limited partnership validly existing under the laws of the
State of Texas. Each
CONFIDENTIAL 16
<PAGE>
of the Sellers has the full corporate or partnership power and authority, as the
case may be, to own, lease and operate its assets (including, collectively, the
Acquired Assets) and to carry on their respective businesses as they are now
being conducted, to own the properties and assets they now own and to perform
their obligations under the contracts by which they are bound (including the
Purchased Contracts). The Sellers are each duly qualified or registered to do
business as a foreign corporation or a foreign partnership, as the case may be,
and are in good standing in each jurisdiction in which the ownership of its
assets or the conduct of its business requires such qualification or
registration.
4.2 Authorization of Transaction. Each of the Sellers has the full
----------------------------
corporate or partnership power and authority, as the case may be, to execute and
deliver this Agreement and any other agreements or instruments to be executed by
the Sellers hereunder, to perform its obligations hereunder and thereunder, and
to consummate the transactions contemplated hereby and thereby, including
without limitation, to own, hold and transfer to the Buyer (pursuant to this
Agreement) the Acquired Assets. The execution and delivery by the Sellers of
this Agreement and any other agreements or instruments to be executed by the
Sellers hereunder and the consummation of the transactions contemplated hereby
and thereby have been duly and validly authorized by all necessary corporate or
partnership action, as the case may be, on the part of each of the Sellers, no
other corporate or partnership action on the part of the Sellers being
necessary. The transactions contemplated hereby and thereby do not require
approval by the stockholders or general partners of the Sellers or if such
approval is required, it shall be obtained prior to the Closing Date in
accordance with applicable law. This Agreement has been, and any other
agreements and instruments to be executed by the Sellers will be, duly and
validly executed and delivered by each Seller and constitute, or will
constitute, the legal, valid and binding obligation of each Seller, enforceable
against each Seller in accordance with their terms, except as such enforcement
may be subject to bankruptcy, insolvency, reorganization, moratorium or other
similar law affecting the enforcement of creditors' rights generally and to
general equitable principles.
4.3 Noncontravention. Neither the execution, delivery or performance of
----------------
this Agreement and any other agreements or instruments to be executed by any of
the Sellers hereunder, nor the consummation of the transactions contemplated
hereby, will (i) conflict with or violate any constitution, statute, regulation,
rule, injunction, judgment, order, decree, ruling, charge, or other restriction
of any Governmental Authority to which any Seller is subject; (ii) conflict
with or violate any provision of the charter, bylaws or any other constitutive
document of any Seller or any resolution adopted by the board of directors, the
stockholders or the general partners of any Seller; or (iii) except for the
consents set forth in Schedule 4.4 hereto, conflict with, result in a breach of,
------------
constitute a default under, result in the acceleration of, create in any party
the right to accelerate, terminate, modify, or cancel, or require any notice
under any material agreement, contract, lease, license, instrument, or other
arrangement to which any Seller is a party or by which it is bound or to which
any of its assets is subject (or result in the imposition of any Lien or
Encumbrance upon any of its assets) or result in the imposition or creation of
any Encumbrance upon or with respect to any of the Acquired Assets.
CONFIDENTIAL 17
<PAGE>
4.4 Governmental and Third Party Consents.
-------------------------------------
(A) No consent, approval, order or authorization of, or
registration, qualification, designation, declaration or filing with, any
Governmental Authority on the part of any of the Sellers is required in
connection with the execution, delivery and performance of this Agreement
or consummation of the transactions contemplated hereby, except for filings
required pursuant to Hart-Scott-Rodino Antitrust Improvements Act of 1976
(the "Hart-Scott-Rodino Act").
(B) Except as set forth on Schedule 4.4 hereto, no consent or waiver
------------
of any Person is required in connection with the execution, delivery and
performance of this Agreement or the consummation of the transactions
contemplated hereby, including, without limitation, consents or waivers
from parties to loans, contracts, indentures, leases, licenses or other
agreements.
4.5 Good Title Conveyed; Binding Obligations; Etc. Except as set forth on
---------------------------------------------
Schedule 4.5, the Sellers are the sole and exclusive owners of the Acquired
- ------------
Assets and the Inventory and have good, valid and marketable title therein, free
and clear of all Liens and Encumbrances, other than the Permitted Liens. Except
as set forth in the Activation Contracts and on Schedule 4.5, on the Closing
------------
Date the Sellers will be the sole and exclusive owners of the Acquired Assets
and the Inventory and will have good, valid and marketable title therein, free
and clear of all Liens and Encumbrances, other than the Permitted Liens. Except
for the Activation Contracts, or as set forth on Schedule 4.4 or Schedule 4.5,
------------- -------------
each Seller has complete and unrestricted power and the unqualified right to
sell, assign, transfer and deliver to the Buyer, and upon consummation of the
transactions contemplated by this Agreement, the Buyer will acquire, good, valid
and marketable title to, or as applicable a valid and enforceable leasehold
interest in, the Acquired Assets and the Inventory, free and clear of all Liens
and Encumbrances, other than the Permitted Liens. Except for the Activation
Contracts, or as set forth on Schedule 4.5, and subject to the consents set
------------
forth on Schedule 4.4, each assignment document executed by the Sellers and the
------------
other instruments to be executed and delivered to the Buyer by the Sellers at
Closing will effectively vest in the Buyer good, valid and marketable title to
the Acquired Assets and the Inventory, free and clear of any Liens and
Encumbrances, except Permitted Liens. Except as set forth on Schedule 4.5,
-------------
contained in the Excluded Assets or retained for use in the Interim Services
Agreement, the Acquired Assets are all of the material tangible personal
property and Intellectual Property adequate to carry on the Business as
presently conducted and include all tangible and intangible assets and goodwill
relating to the Business.
CONFIDENTIAL 18
<PAGE>
4.6 Financial Statements.
--------------------
(A) Attached hereto as Schedule 4.6(A) are the audited balance
---------------
sheets and statements of operations, stockholders' equity and cash flow
(collectively, the "Financials") as of and for the three (3) years ended
November 30, 1993, November 30, 1994 and November 30, 1995, respectively
(collectively, the "Financial Statements") presented on a consolidated
basis for the Parent and its subsidiaries. As used herein the balance
sheets as of the year ended November 30, 1995, included as part of the
Financial Statements are referred to as the "November Balance Sheets". The
Financial Statements (including the notes thereto) have been prepared in
accordance with GAAP on a consistent basis throughout the periods covered
thereby, are materially correct, and present fairly the consolidated
financial condition of the Parent and its subsidiaries as of such dates and
the consolidated results of operations of the Parent and its subsidiaries
for such periods.
(B) Attached hereto as Schedule 4.6(B) are the July 31, 1996,
---------------
unaudited balance sheet and the related unaudited statement of operations
of the Parent and its subsidiaries on a consolidated basis and the list of
fixed assets and profit and loss statements for the Sam's Club segment of
business for the eight-month period then ended not reflecting quarterly
adjustments typically made in the Ordinary Course of Business (the "Interim
Financial Statements"). The Interim Financial Statements have been prepared
from the books and records of the Parent and its subsidiaries on a
consolidated basis in accordance with GAAP for interim financial statements
(except for the allocation of selling, general and administrative expenses
and not reflecting quarterly adjustments typically made in the Ordinary
Course of Business for the Sam's Club segment of the business), fairly
present the consolidated financial condition of the Parent and its
subsidiaries at such date and the results of operations of the Parent and
its subsidiaries on a consolidated basis for such period, are true, correct
and complete, and are consistent with the books and records of the Parent
and its subsidiaries on a consolidated basis (which books and records are
true, correct and complete in all material respects).
(C) Since December 7, 1993, the minute books and stock record books
of each of the Sellers, all of which have been made available to Buyer, are
complete and correct and have been maintained in accordance with good
business practices. The minute books of each of the Sellers contain
accurate and complete records of all meetings held since December 7, 1993
of, and material corporate or partnership action by, the stockholders, the
board of directors (and committees thereof) and the general partner, as the
case may be, of each Seller, and no meeting of any such stockholders, board
of directors (or committees thereof) or general partner has been held since
December 7, 1993, for which minutes have not been prepared and are not
contained in such minute books.
4.7 Undisclosed Liabilities. Except as set forth on Schedule 4.7, no
----------------------- ------------
Seller has a material Liability relating to the Business (and to the best of
each Seller's knowledge, there is no basis for any present or future Legal
Proceeding against any Seller relating to the Business giving rise to any
CONFIDENTIAL 19
<PAGE>
Liability including, without limitation, claims for infringement), except for
(i) Liabilities set forth on the face of the balance sheets included as part of
the Interim Financial Statement (the "Interim Balance Sheets") and (ii) non-
material Liabilities which have arisen after the date of Interim Balance Sheets
in the Ordinary Course of Business (none of which results from, arises out of,
relates to, is in the nature of, or was caused by any breach of contract, breach
of warranty, tort, infringement, or violation of law).
4.8 Legal Compliance; Litigation. Except as set forth on Schedule 4.8,
---------------------------- ------------
each Seller and their Affiliates have complied with all material applicable laws
(including rules, regulations, codes, plans, injunctions, judgments, orders,
decrees, rulings, and charges thereunder) of Governmental Authorities relating
to the Business, including without limitation, all such laws, regulations and
requirements relating to antitrust, consumer protection, equal opportunity
health, occupational safety, zoning, building, environmental, product liability,
employee benefits, payment of Taxes, and securities, and no Legal Proceeding has
been filed, commenced or, to the best of Seller's knowledge, threatened or
proposed in any manner or any circumstances which should or could reasonably
form the basis of any such action, suit, proceeding or investigation against any
of them alleging any failure so to comply. Schedule 4.8 sets forth each instance
------------
in which the Seller (i) is subject to any outstanding injunction, judgment,
order, decree, ruling, or charge related to the Business or (ii) is a party to
or, to the knowledge of the Seller, is threatened to be made a party to, any
Legal Proceeding related to the Business, before any court or quasi-judicial or
administrative agency of any federal, state, local, or foreign jurisdiction or
before any arbitrator. To the best of the Sellers' knowledge, none of the Legal
Proceedings set forth in Schedule 4.8 is expected to result in a Material
------------
Adverse Effect.
4.9 Permits. To the best of Sellers' knowledge, each Seller has all
-------
material licenses, permits, approvals, and any required material registration
with, any Governmental Authority necessary for the conduct of the Business as
currently operated or for the lawful operation of each Seller's real property
and equipment as currently operated and as used in connection with the Business
("Permits"). All Permits are in full force and, as of the date hereof, no Legal
Proceeding is pending, or to the best of the Sellers' knowledge, threatened, to
revoke or limit any such Permit. Each such Permit required to permit each
Seller to carry on the Business as currently conducted is listed in Schedule
--------
4.9.
- ----
4.10 Tax Matters. There are no Tax Liens upon any of the Acquired Assets
-----------
or the Inventory. Except as set forth on Schedule 4.10, each of the Sellers have
-------------
timely filed with the appropriate Governmental Authorities all federal, state
and local Tax Returns as required by law, and all such Tax Returns were true,
correct and complete in all respects. Except as set forth on Schedule 4.10, all
-------------
Taxes which are due or payable with regard to the Business, and the Acquired
Assets, the Inventory and their use in the Business and all interest and
penalties thereon, have been paid in full. Except as set forth on Schedule
--------
4.10, there are no audits or other proceedings or investigations currently
- ----
pending or to the best of the Sellers' knowledge, threatened and that it has not
taken any position on a Tax Return that would rise to a Tax Lien upon the
Acquired Assets or Inventory.
CONFIDENTIAL 20
<PAGE>
4.11 Condition of Acquired Assets. Except as set forth on Schedule 4.11,
---------------------------- -------------
all of the Acquired Assets are currently being used in the operations of the
Business, are free and clear of all material defects (whether patent or latent),
have been maintained in accordance with normal industry practice, are in good
operating condition and repair (subject to normal wear and tear), and are
suitable for the purposes for which they presently are used.
4.12 Business Intellectual Property Rights.
-------------------------------------
(A) Schedule 2.2(B) sets forth an accurate and complete description
---------------
of all material Business Intellectual Property Rights specifying as to each
such Business Intellectual Property Right, as applicable: (i) the nature of
such Business Intellectual Property Right; (ii) the owner of such Business
Intellectual Property Right; (iii) if such Business Intellectual Property
Right is owned by a Seller, the jurisdiction(s) by or in which such
Business Intellectual Property Right has been issued or registered or in
which an application for such issuance or registration has been filed,
including the respective registration or application number; (iv) all
franchises, licenses, sublicenses, contracts and agreements pursuant to
which any Person other than a Seller is authorized to use any such Business
Intellectual Property Right owned by a Seller; and (v) the franchises,
licenses, sublicenses, contracts and agreements pursuant to which a Seller
is authorized to use any such Business Intellectual Property Right not
owned by such Seller, including with respect to (iv) or (v), the identity
of all parties thereto, a description of the nature and subject matter
thereof, the royalty provided and the term thereof.
(B) Except as set forth on Schedule 2.2(B), Schedule 2.4(H), or
--------------- ---------------
Schedule 4.12, the Sellers own or have the right to use pursuant to
-------------
franchise, license, sublicense, contract, agreement, or permission, all of
the Business Intellectual Property Rights. Except for the trademarks
licensed pursuant to the Interim Services Agreement and as set forth on
Schedule 2.2(B) and Schedule 4.12, each Business Intellectual Property
-------------- -------------
Right owned or as to which any Seller has the right to use immediately
prior to the Closing hereunder will be owned or available for use by the
Buyer on identical terms and conditions immediately subsequent to the
Closing hereunder. The Sellers have taken all reasonably necessary and
desirable action to maintain and protect each Business Intellectual
Property Right that they own or have the right to use.
(C) All applicable fees, royalties and other amounts due and payable
by or to any Person or the Sellers in respect of the Business Intellectual
Property Rights have been paid. Except for third party licenses listed on
Schedule 2.2(B), the Sellers are the sole and exclusive owners of the
---------------
Business Intellectual Property Rights including, but not limited to, those
listed or described on Schedule 2.2(B) and have the sole and exclusive
---------------
right to the use thereof for the material covered thereby in connection
with the services or products in respect to which they have been or are now
being used.
(D) Except as set forth on Schedule 4.12, no Seller (i) is the
-------------
subject of any pending litigation or to such Seller's knowledge, any claim
regarding infringement of or
CONFIDENTIAL 21
<PAGE>
misappropriation or misuse of any Business Intellectual Property Right or
other intangible right of any other Person, (ii) has any knowledge of any
such infringement, whether or not claimed by any other Person, which
infringement might have a Material Adverse Effect, (iii) has any knowledge
of any infringement by any other Person of any of the Business Intellectual
Property Rights, and (iv) has any knowledge of any facts or circumstances
which could reasonably be anticipated to result in any such litigation or
claim or which could reasonably lead any Seller to conclude that the
continued operation and conduct of any aspect of the Business could result
in any such litigation or claim. Except as set forth on Schedule 4.12, no
-------------
Seller is aware of any other Person that is operating under or otherwise
using any name confusingly similar with any trade names, trademarks,
service names, service marks or logos included in the Business Intellectual
Property Rights. Except as set forth on Schedule 4.12, to the best of the
-------------
Sellers' knowledge no Business Intellectual Property licensed from a third
party is subject to any outstanding order, judgment, decree, stipulation or
agreement restricting the use thereof by any of the Sellers. Except as set
forth on Schedule 4.12, no Business Intellectual Property Right is subject
-------------
to any outstanding order, judgment, decree, stipulation or agreement
restricting the use thereof by any of the Sellers. Except as set forth on
Schedule 4.12, no Seller has entered into any written agreement to
-------------
indemnify any other Person against any charge of infringement by any
Business Intellectual Property Rights.
(E) To the best of Sellers' knowledge after reasonable inquiry, no
material Trade Secrets included in the Business Intellectual Property
Rights have been disclosed by any Seller to any Person other than
employees, agents and representatives of the Sellers and their Affiliates
or the Buyer. The Sellers have taken such reasonable and desirable measures
as the Sellers deem appropriate to protect all of the Trade Secrets.
(F) Except for obligations that arise under the common law of the
appropriate jurisdiction, to the best of the Sellers' knowledge, neither
the Sellers, nor to the best of the Sellers' knowledge any of the
Employees, has any written agreements or arrangements with former employers
of such Employees relating to Trade Secrets of such employers, the
assignment of inventions of such employers, or such Employee's engagement
in activities competitive with such employers. Except for obligations that
arise under the common law of the appropriate jurisdiction, to the best of
the Sellers' knowledge, the activities of such Employees on behalf of the
Sellers do not violate any agreements or arrangements known to any of the
Sellers, which any such Employees have with former employers.
4.13 Real Property. Schedule 4.13 sets forth a list of all of the real
------------- -------------
property leased by the Sellers and used primarily in connection with the
Business (the "Leased Real Property") and the agreements evidencing such leases.
Except as set forth on Schedule 4.13, Sellers (i) have a valid leasehold
-------------
interest in the Leased Real Property, and fixtures and improvements thereon used
by it in the Business free and clear of all Liens other than Permitted Liens,
(ii) are not in default under any lease or license for such Leased Real Property
and (iii) there is not, under any lease or license for such Leased Real
Property, any event of default or event which, with notice and/or lapse of time
would constitute a default by any party to such agreements. No Seller owns or
has title to any real property
CONFIDENTIAL 22
<PAGE>
used primarily in connection with the Business nor does any Seller have any
right in or use or occupy any real property for a purpose primarily in
connection with the Business except as set forth in this Section 4.13.
4.14 Inventory. All of the Inventory is used in connection with, or
---------
relates to the conduct of the Business, and none of the Inventory is damaged or
materially defective.
4.15 Contracts.
---------
(A) Schedule 4.15 is an accurate list and summary description of all
-------------
material contracts and agreements to which any of the Sellers is a party
and relating primarily to the conduct of the Business (including, without
limitation, joint venture agreements, employment contracts, loan
agreements, bonds, mortgages, Liens, Encumbrances, pledges or other
security agreements) (collectively, the "Contracts").
(B) Except as set forth on Schedule 4.15 or contracts related solely
-------------
to the Seller's paging business, with regard to the operation of the
Business:
(1) No Seller is a party to any contract, purchase or sales
orders out of the Ordinary Course of Business, or commitment relating
primarily to the conduct of the Business or the ownership of the
Acquired Assets or the Inventory that involves a dollar amount in
excess of $25,000;
(2) No Seller is a party to any employment contracts with any
Employees;
(3) No Seller is a party to any material contract with sales or
other agents, brokers, franchisees, distributors or dealers relating
primarily to the conduct of the Business or the ownership of the
Acquired Assets or the Inventory;
(4) No Seller is a party to any partnership or joint venture
agreement;
(5) No Seller is a party to any material lease or other
occupancy or use agreements, oral or written, nor has any Seller
granted any options, rights of first refusal or security or other
interests in or relating to the Acquired Assets, the Inventory or the
Business;
(6) No Seller has any material agreements giving any party the
right to renegotiate or require a reduction in price or refund of
payments previously made in connection with the Business;
(7) No Seller has any material agreements for the borrowing or
lending of money with respect to the Business and none is a party to
any;
CONFIDENTIAL 23
<PAGE>
(8) No Seller has any material agreement for the sale of goods
or services to any Governmental Authority;
(9) No Seller has any agreement granting any Person a Lien or
Encumbrance on any of the Acquired Assets or the Inventory;
(10) Except for the Purchased Contracts, no Seller is a party to
or bound by any non-competition, secrecy or confidentiality agreement
relating to the Business or the Acquired Assets or any other contract
restricting its right to conduct the Business at any time, in any
manner or at any place in the world, or the expansion thereof to
other geographical areas, customers, suppliers or lines of Business;
and
(11) No Seller is a party to any material contract or
arrangement that under circumstances now foreseeable is likely to
have a Material Adverse Effect.
(C) A true and correct copy of each Contract (or, where they are
oral, complete and correct written summaries thereof) has been delivered to
the Buyer prior to the date hereof. To the best of Sellers' knowledge, each
Contract is now valid and in full force and effect. None of the Sellers has
breached or improperly terminated any such Contract, and neither the
Sellers nor, to the Sellers' knowledge, any third party is in default under
any such Contract, the effect of which would have a Material Adverse
Effect. To the best of Sellers' knowledge, there exists no condition or
event which, after notice or lapse of time or both, would constitute any
such breach, termination or default the effect of which would have a
Material Adverse Effect. Except as set forth on Schedule 4.4, each such
------------
Contract to be assigned to the Buyer pursuant to this Agreement either is
assignable to the Buyer without the consent of the other parties thereto
or, with respect to any which may not be so assigned without such consents,
the required consents are set forth in Schedule 4.4.
------------
4.16 Insurance. Schedule 4.16 contains a description of all policies of
--------- -------------
title, liability, fire, worker's compensation and other forms of insurance
currently insuring the Acquired Assets and sets forth the name of the insurer,
and type and amount of coverage. All such policies are in full force and effect
and all premiums due and payable on all such policies have been paid.
4.17 Employee Benefits.
-----------------
(A) Schedule 4.17 completely and accurately lists (and identifies
-------------
the sponsor of) every "employee pension benefit plan," as that term is
defined in Section 3 of the Employee Retirement Income Security Act of
1974, as amended from time to time, and the rules and regulations
promulgated thereunder ("ERISA"), every "employee welfare benefit plan," as
that term is defined in Section 3 of ERISA (such plans being hereinafter
referred to collectively as the "ERISA Plans"), and every other retirement,
pension, profit-sharing, money purchase, deferred compensation, incentive
compensation, bonus, stock option, stock purchase, severance pay,
unemployment benefit, vacation pay, health, life or other insurance,
CONFIDENTIAL 24
<PAGE>
fringe benefit, or other employee benefit plan, program, agreement, or
arrangement maintained or contributed to by the Sellers, in respect of or
for the benefit of any Employee or former Employee or in which any Employee
or former Employee (or beneficiary thereof) is a participant as of the date
hereof or of the Closing (collectively, together with the ERISA Plans,
referred to hereinafter as the "Plans"). There are no Plans, written or
unwritten, that are not listed on Schedule 4.17.
--------------
(B) Except as set forth on Schedule 4.17, with respect to the ERISA
-------------
Plans:
(1) neither the Sellers nor any of the Plans, any trust
established thereunder, any trustee or administrator thereof, or any
"party-in-interest" or "disqualified person" with respect to any Plan
(respectively, within the meanings of Section 3 of ERISA and Section
4975 of the Code, has engaged in any transaction as a result of which
the Sellers, could be subject to Liability pursuant to Section 409 of
ERISA or to either a civil penalty assessed pursuant to Section
502(i) of ERISA or a tax imposed pursuant to Section 4975 of the
Code;
(2) none of the Plans is a defined benefit pension plan subject
to Title IV of ERISA ("Pension Plan"), and none of the Sellers has
terminated any such Plan;
(3) full and timely payment has been made or shall be made of
all amounts that, the Sellers are required to pay as contributions to
the Plans as of the Closing Date or as of the last day of the most
recent fiscal year of each of the Plans ended prior to the date of
this Agreement;
(4) each of the Plans and each of the trusts established
thereunder have been operated and administered in all material
respects in accordance with all applicable laws, including, but not
limited to, ERISA and the Code;
(5) each of the ERISA Plans that is intended to be "qualified"
within the meaning of Section 401(a) of the Code, and each of the
trusts established thereunder that is intended to be "qualified"
within the meaning of Sections 401(a) and 501(a) of the Code, have
been determined by the Internal Revenue Service (the "IRS") to be so
qualified, and nothing has occurred since the date of the most recent
such determination that would adversely affect the qualified status
of any of such ERISA Plans or the trusts thereunder;
(6) there are no pending claims by or on behalf of any of the
Plans, by any Employee, former Employee, participant, or beneficiary
covered under any such Plan, or otherwise involving any such Plan
(other than routine claims for benefits);
CONFIDENTIAL 25
<PAGE>
(7) no Plan provides for post-retirement health, welfare, or
life insurance benefits, except as may be required under Part 6 of
Subtitle B of Title I of ERISA; and
(8) each Plan is operated and administered in accordance with
the written plan documents governing such plan, and there are no
provisions not included in such documents that the Plan is obligated
to add to such documents or to observe as of the date hereof or at
any time hereafter.
(C) None of the Plans is a "multiemployer plan," as that term is
defined in Section 3(37) of ERISA and, with respect to multiemployer plans
(as so defined), none of the Sellers has made or incurred a "complete
withdrawal" or a "partial withdrawal," as such terms are respectively
defined in Sections 4203 and 4205 of ERISA.
(D) Under the applicable laws of all jurisdictions within the United
States of America and all foreign jurisdictions or other agreement
whatsoever, with respect to any Plan, (i) there were no amounts accrued but
unpaid that are not reflected on the November Balance Sheet; and (ii)
consummation of the acquisition of the Acquired Assets by the Buyer as
contemplated herein would not trigger, result in, or cause to mature,
otherwise than in the ordinary course of the business as heretofore
conducted, any Employee or employee benefits-related claims, whether
assertable by Employees or by any other Person or legal entity or by any
Governmental Authority or other entity.
4.18 Employee Salaries. Schedule 4.18 sets forth for each of the
----------------- -------------
Employees the following: (i) the employment date of such Employee by each
Seller; (ii) the title or position of such Employee; (iii) the social security
number of each such Employee; and (iv) the current salary rate for such Employee
as of July 31, 1996 (also showing separately amounts paid as commissions, bonus
payments and other cash compensation from January 1, 1995, through July 31,
1996). Schedule 4.18 sets forth a complete description of all commission and
-------------
bonus policies of each Seller related primarily to the Business in force from
and after November 1, 1994.
4.19 Employee Relations and Labor Matters.
------------------------------------
(A) Except as set forth on Schedule 4.19 with respect primarily to
-------------
the conduct of the Business and the ownership of the Acquired Assets and
Inventory:
(1) there are no charges of discrimination (relating to age,
sex, race, religion, national origin, color, disability, sexual
preference, handicap, veteran status or any other factors prohibited
by law) or unfair labor practice charges or complaints against the
Seller pending or, to the knowledge of the Sellers, threatened before
any Governmental Authority;
CONFIDENTIAL 26
<PAGE>
(2) there is no labor strike, dispute, slowdown or stoppage
actually pending or, to the knowledge of the Sellers, threatened
against or affecting any Seller; and
(3) there is no representation, claim or petition pending before
the National Labor Relations Board and no question concerning
representation exists with respect to the Employees of any of the
Sellers. None of the Sellers is a party to any collective bargaining
agreement, and to the Sellers' knowledge there have been no
threatened or contemplated attempts to apply for certification of a
collective bargaining agent for any of the Employees.
(B) Except as set forth on Schedule 4.19 and except for matters that
-------------
do not have a Material Adverse Effect,
(1) each Seller is in compliance with all applicable laws
respecting employment and employment practices, terms and conditions
of employment, and wages and hours, and are not engaged in any unfair
labor practice;
(2) there is no labor or employment grievance and no claim
therefor exists; and
(3) neither the Sellers nor their predecessors, in connection
with the Business, have experienced any work stoppage or other labor
difficulty during the three (3) year period ending on the date
hereof.
4.20 Environment, Health and Safety. Each Seller, and its respective
------------------------------
predecessors and Affiliates, have complied with all Environmental, Health, and
Safety Laws, and no Legal Proceeding has been filed or commenced against any of
them alleging any failure so to comply. Neither the Sellers nor any other
Person for whose conduct it is or may be held responsible, has permitted or
conducted, or is aware of, any Hazardous Activity conducted with respect to the
Facilities. There has been no Release or, to the knowledge of the Sellers,
Threat of Release, of any Hazardous Materials at or from the Facilities.
4.21 Affiliate Transactions. Except for the Employees and except as set
----------------------
forth in Schedule 4.21 hereto, no officer, director or Affiliate of any Seller
-------------
provides or causes to be provided any assets or facilities used primarily in
connection with or services whose primary focus relates to the Business which
are individually or in the aggregate material to its operation. No Affiliate of
any Seller owns or has any rights to the Acquired Assets. Except as set forth
on Schedule 4.21 hereto, the Business does not provide or cause to be provided
-------------
any assets, services or facilities to any such officer, director or Affiliate of
any Seller which are individually or in the aggregate material to the operations
of the Business.
4.22 Entire Business. The sale of the Acquired Assets and the Inventory
---------------
by the Sellers to the Buyer pursuant to this Agreement, together with the
consummation of the other transactions
CONFIDENTIAL 27
<PAGE>
contemplated by this Agreement, will effectively convey to the Buyer, in all
material respects all tangible personal property and Intellectual Property that
is necessary or useful to operate the Business as conducted by the Sellers.
4.23 Absence of Certain Changes or Events. Since July 31, 1996 with
------------------------------------
regard to the Business, there has not been:
(A) any material change in the financial condition, assets,
liabilities, personnel policies or practices, or contracts or business of
the Sellers or in its relationships with suppliers, customers, licensees,
distributors, lessors or others, except changes in the Ordinary Course of
Business;
(B) any material damage, destruction or loss (whether or not covered
by insurance) or any other event materially affecting the Business or the
Acquired Assets or the Inventory;
(C) any forgiveness or cancellation of material debts or claims owed
to the Sellers and related primarily to the Business, or termination,
abandonment or waiver of any material rights related primarily to the
Business;
(D) except for increases in the Ordinary Course of Business, any
increase in the compensation or benefits payable or to become payable by
the Sellers to any of the directors, officers or Employees of the Sellers;
(E) any discharge or satisfaction of any Lien or payment of any
Liability or obligation by the Sellers other than current Liabilities in
the Ordinary Course of Business;
(F) any material change in the credit practices of the Sellers or in
their methods of maintaining their books, accounts or business records; or
(G) any event that would have a Material Adverse Effect.
4.24 Ability to Pay Debts. On and as of the Closing Date, after giving
--------------------
effect to the transactions contemplated hereby the Sellers will not have
incurred, nor intend to incur, nor know or have reason to believe any of them
will incur, debts beyond their ability to pay such debts as they mature.
4.25 Customers and Suppliers. Except for the Purchased Contracts,
------------------------
customers and suppliers related solely to the paging business, the Sellers have
no knowledge of any termination or cancellation of (or any intent to terminate
or cancel) the business relationship of any Seller with (i) any single customer
or any group of affiliated customers who represented five percent (5%) or more
of the revenues of the Business during the fiscal year ended November 30, 1995,
or (ii) any single supplier or any group of affiliated suppliers who provided
five percent (5%) or more of the requirements of the Business during the fiscal
year ended November 30, 1995.
CONFIDENTIAL
28
<PAGE>
4.26 Furniture, Fixtures, Equipment, etc. Except for the Fixed Assets and
------------------------------------
the items listed on Schedule 4.5, there are no items of furniture, fixtures,
------------
equipment, machinery, computer and other equipment and other tangible personal
property used or held for use at the locations at which the Business is
conducted, or at customers' premises on consignment, or otherwise owned or held
by the Sellers for use primarily in the Business as well as any motor vehicles
owned by the Sellers and utilized by their Employees or agents in the conduct of
the Business with a value in excess of $1,500.
4.27 WARN Act. Schedule 4.27 hereto lists the full name, job title, job
-------- -------------
site and unit, date of Employment Loss, and type of Employment Loss of each
Employee who has experienced an Employment Loss in the ninety (90) days
preceding the date of this Agreement. The Sellers do not presently intend to
take any action that would result in an Employment Loss by any Employee between
the date of this Agreement and the Closing, and the Sellers shall assume any and
all obligations and liabilities related to any terminations of employment
through the Closing Date with respect to Employees.
4.28 Brokers' Fees. The Sellers have no Liability or obligation to pay
-------------
any fees or commissions to any broker, finder, or agent with respect to the
transactions contemplated by this Agreement for which the Buyer could become
liable or obligated.
4.29 Disclosure. Each of the Sellers has used their Best Efforts to fully
----------
provide the Buyer with all documents and information which the Buyer has
requested and to the best of each Seller's knowledge, all information material
to a decision to make the investment and enter into the transactions
contemplated hereby. To the best of each Seller's knowledge, neither this
Agreement, the Schedules hereto nor any other agreements, documents, statements
or certificates made or delivered in connection herewith contains any untrue
statement of a material fact or omits to state a material fact necessary to make
the statements herein or therein not misleading. To the best of each Seller's
knowledge, there is no material fact relating to the Sellers or the operations,
affairs or conditions of the Sellers which would have a Material Adverse Effect
which has not been set forth in this Agreement or in the other documents
furnished to the Buyer prior to the date hereof.
ARTICLE 5 -- REPRESENTATIONS AND WARRANTIES OF THE BUYER
The Buyer represents and warrants to the Sellers that the following matters
are correct and complete as of the date hereof and will also be correct and
complete as of the Closing Date:
5.1 Organization of the Buyer. The Buyer is a corporation duly
-------------------------
incorporated, validly existing, and in good standing under the laws of the State
of Delaware.
5.2 Authorization of Transaction. The Buyer has the full corporate power
----------------------------
and authority to execute and deliver this Agreement and any other agreements or
instruments to be executed by the Buyer hereunder, to perform its obligations
hereunder and thereunder, and to consummate the
CONFIDENTIAL
29
<PAGE>
transactions contemplated hereby and thereby, including without limitation, to
acquire (pursuant to this Agreement) the Acquired Assets. The execution and
delivery by the Buyer of this Agreement and of any other agreements or
instruments to be executed hereunder, and the performance by the Buyer of its
respective obligations hereunder and thereunder have been duly and validly
authorized by all necessary corporate actions of the Buyer, no other corporate
action on the part of the Buyer being necessary. The transactions contemplated
hereby and thereby do not require approval of the stockholders of the Buyer, or
if such approval is required, it shall be obtained prior to the Closing Date in
accordance with applicable law. This Agreement has been, and any other
agreements and instruments to be executed hereunder shall be, duly and validly
executed and delivered by the Buyer and shall constitute legal, valid and
binding obligations of the Buyer enforceable against the Buyer in accordance
with their terms, except as enforceability may be limited by any bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting the
enforcement of creditors' rights generally and general equitable principles.
5.3 Noncontravention. Neither the execution, delivery or performance of
----------------
this Agreement and any other agreements or instruments to be executed by the
Buyer hereunder, nor the consummation of the transactions contemplated hereby,
will (i) conflict with or violate any constitution, statute, regulation, rule,
injunction, judgment, order, decree, ruling, charge, or other restriction of any
Governmental Authority to which the Buyer is subject; (ii) conflict with or
violate any provision of the charter, bylaws or any other constitutive document
of the Buyer or any resolution adopted by the board of directors or the
stockholders of the Buyer; or (iii) conflict with, result in a breach of,
constitute a default under, result in the acceleration of, create in any party
the right to accelerate, terminate, modify, or cancel, or require any notice
under any agreement, contract, lease, license, instrument, or other arrangement
to which the Buyer is a party or by which it is bound or to which any of its
assets is subject.
5.4 Governmental Consents.
---------------------
(A) No consent, approval, order or authorization of, or registration,
qualification, designation, declaration or filing with, any Governmental
Authority on the part of the Buyer is required in connection with the
execution, delivery and performance of this Agreement or consummation of
the transactions contemplated hereby, except for filings required pursuant
to the Hart-Scott-Rodino Act.
(B) Except as set forth on Schedule 5.4 hereto, no consent or waiver
------------
of any Person is required in connection with the execution, delivery and
performance of this Agreement or the consummation of the transactions
contemplated hereby, including, without limitation, consents or waivers
from parties to loans, contracts, indentures, leases, licenses or other
agreements.
5.5 Brokers' Fees. The Buyer has no Liability or obligation to pay any
-------------
fees or commissions to any broker, finder, or agent with respect to the
transactions contemplated by this Agreement for which the Seller could become
liable or obligated.
CONFIDENTIAL
30
<PAGE>
ARTICLE 6 -- COVENANTS OF THE PARTIES
The Parties hereto hereby covenant with each other as follows:
6.1 General. Prior to the Closing Date, each of the Parties will use
-------
its Best Efforts to take all actions and do all things necessary, proper or
advisable to consummate and make effective the transactions contemplated by this
Agreement, including satisfying the conditions to closing set forth in Articles
8 and 9 hereto. In the event that the Parties cannot obtain an assignment of
the AT&T Contract, the parties shall enter into the Option Agreement.
6.2 Expenses. Except as otherwise specifically provided herein, each
--------
Party hereto will bear the legal, accounting and other expenses incurred by such
Party in connection with this Agreement, and the other agreements and
transactions contemplated hereby. The Sellers agree to bear all sales, use,
transfer, recording and other similar taxes and fees including, but not limited
to, any income, franchise, gross receipts, capital gains or similar taxes
imposed on the income, receipts or gain of the Sellers arising out of or in
connection with the transactions contemplated by this Agreement. In addition,
the Sellers shall be responsible for any property taxes on the Inventory and the
Acquired Assets for the tax year that includes the Closing Date as provided in
Section 3.5 above. Each Party will use its Best Efforts to avail itself of any
available exemptions from any such taxes or fees, and will cooperate with the
other in providing any information and documentation that may be necessary to
obtain such exemptions.
6.3 Public Announcements. Unless required to be made pursuant to any
--------------------
applicable law, regulation or other requirement of any Governmental Authority,
neither the Sellers nor the Buyer shall make any public announcement regarding
this Agreement or the consummation of the transactions contemplated hereby
without the prior consent of the other Party hereto to such announcement or
press release and its contents.
6.4 Cooperation; Further Assurances. Subject to the terms and
-------------------------------
conditions of this Agreement, each of the Parties hereto shall cooperate fully
with the others in preparing and filing all notices, applications, reports and
other instruments and documents that are required by any statute, rule,
regulation or order of any Person in connection with the transactions
contemplated by this Agreement and shall use all reasonable efforts to take, or
cause to be taken, all action, and to do, or cause to be done, all things
necessary, proper or advisable under applicable laws and regulations, or
otherwise to fulfill its obligations under this Agreement and to consummate
fully the transactions contemplated by this Agreement.
6.5 Consents, Filings and Approvals.
-------------------------------
(A) Prior to the Closing Date, each of the Parties hereto
shall use their Best Efforts to obtain at the earliest practicable
date prior to the Closing all governmental and administrative
consents, approvals, authorizations, waivers, permits, licenses,
certificates and franchises, including filings pursuant to the Hart-
Scott-Rodino Act as described in Section
CONFIDENTIAL
31
<PAGE>
6.8 below (collectively "Governmental Approvals") and all consents or
waivers of all third parties to leases, licenses, agreements,
indentures or other instruments (collectively, "Consents") necessary
to the consummation of the transactions contemplated hereby or to
assign or transfer effectively to the Buyer the Acquired Assets and
the Business and will provide to the Buyer copies of each such
Governmental Approval and Consent promptly after it is obtained. The
Parties shall coordinate and cooperate with one another in exchanging
such information and reasonable assistance as may be requested in
connection with all of the foregoing.
(B) Nothing contained in this Section 6.5 to the contrary, this
Agreement shall not constitute an agreement to assign any claim,
contract, license, lease, commitment, sales order or purchase order
(an "Accord") if an attempted assignment of the same without the
consent of the other party thereto, would constitute a breach thereof
or in any way have a Material Adverse Effect on the rights of the
Sellers thereunder. The Parties shall use their Best Efforts to obtain
all Consents and to resolve all impracticalities of assignments or
transfers necessary to convey the Acquired Assets, the Inventory and
the Business to the Buyer. If such Consents or waivers are not
obtained, or if an attempted assignment would be ineffective, the
Parties agree to use their Best Efforts to resolve such matter in a
mutually beneficial manner. In addition to, and not by way of
limitation of, the Buyer's obligations pursuant to the foregoing
sentence, as to any Accord included in the Acquired Assets that is not
effectively assigned to the Buyer at the Closing but is thereafter
effectively assigned to the Buyer, the Buyer shall, from and after the
effective date of such assignment assume, and shall thereafter pay,
perform and discharge as and when due, all Liabilities and obligations
of the Sellers arising under such Accord from and after the effective
date of such assignment.
6.6 Accuracy of Representations. Each of the Parties agrees that
---------------------------
prior to the Closing Date it will not knowingly enter into any transaction or
take any action, and will endeavor in good faith not to permit any event to
occur, which would result in any of its representations, warranties, covenants
or agreements contained in this Agreement (or in any agreement, document or
instrument required by the terms of this Agreement to be delivered hereunder)
being untrue and incorrect in any material respect, or not being performed as
contemplated in this Agreement.
6.7 Notification of Certain Matters. Prior to the Closing Date, the
-------------------------------
Sellers shall give prompt notice to the Buyer, and the Buyer shall give prompt
notice to the Sellers, of (i) the occurrence, or failure to occur, of any event
which occurrence or failure would be likely to cause any representation or
warranty contained in this Agreement to be untrue or inaccurate in any respect
at any time from the date hereof, except with respect to Section 4.19 the hiring
and firing of Employees in the Ordinary Course of Business, and (ii) any failure
of the Buyer or the Sellers, as the case may be, or any officer, director,
employee or agent thereof, to comply with or satisfy any covenant, condition or
agreement to be complied with or satisfied by it hereunder.
6.8 Hart-Scott-Rodino. As promptly as practicable, but in no event
-----------------
later than fifteen (15) days following the date hereof, the Sellers and the
Buyer shall complete any filing that may be
CONFIDENTIAL
32
<PAGE>
required pursuant to the Hart-Scott-Rodino Act, or shall mutually agree that no
such filing is required. The Sellers and the Buyer shall diligently take (or
fully cooperate in the taking of) all actions, and provide any additional
information, required or reasonably requested in order to comply with the
requirements of the Hart-Scott-Rodino Act. The Buyer shall pay the Hart-Scott-
Rodino Act filing fee.
6.9 Disclosure of Confidential Information. Each of the Parties
--------------------------------------
shall protect all Confidential Information from disclosure to others, using the
same degree of care used to protect its own confidential or proprietary
information of like importance, but in any case using no less than a reasonable
degree of care. Each of the Parties may disclose Confidential Information to
(i) its Affiliates who agree, in advance, in writing, to be bound by the
restrictions on disclosure and use set forth in this Section 6.9, and (ii) to
its employees and consultants, and its Affiliates' employees and consultants,
who have a need to know, for the purpose of this Agreement, and who are bound to
protect the received Confidential Information from unauthorized use and
disclosure under the terms of a written agreement. Confidential Information
shall not otherwise be disclosed to any third party without the prior written
consent of the Parties; provided, however, that the Buyer may publish,
-------- -------
disseminate or otherwise disclose or reveal in any manner any Business
Intellectual Property Rights. In the event that a Party is required by law,
regulation or court order to disclose any Confidential Information, such Party
will promptly notify the other Parties in writing prior to making any such
disclosure in order to facilitate the other Parties seeking a protective order
or other appropriate remedy from the proper authority. The Parties not seeking
to disclose the Confidential Information agree not to impede with the Party
seeking such order or other remedy. The Party seeking to disclose the
Confidential Information further agrees that if such Party is not successful in
precluding the requesting legal body from requiring the disclosure of the
Confidential Information, it will furnish only that portion of the Confidential
Information which is legally required and will exercise all reasonable efforts
to obtain reliable assurances that confidential treatment will be accorded the
Confidential Information. The term "Confidential Information" does not include
information which (i) was publicly known at the time of a Party's communication
thereof to the recipient, (ii) becomes publicly known through no fault of the
recipient subsequent to the time of its communication thereof to the recipient,
(iii) was in the recipient's possession free of any obligation of confidence at
the time of its communication thereof to the recipient, (iv) is developed by the
recipient independently of and without reference to any of the Confidential
Information or other information that the disclosing Party disclosed in
confidence to any third party, (v) is rightfully obtained by the recipient from
third parties authorized to make such disclosure without restriction; or (vi) is
identified by the disclosing Party as no longer proprietary or confidential.
6.10 Retention of Records. The Parties agree all books and records
--------------------
which relate to the Business shall be available for inspection for any
reasonable purpose during reasonable business hours to counsel, accountants and
other agents or representatives of the Sellers or the Buyer, as the case may be;
provided, however, that the Buyer may transfer such books and records to another
- -------- -------
Person in connection with a sale or transfer by the Buyer to such other Person
of all or any substantive part of the Business so long as such Person assumes
and agrees to be bound by the Buyer's obligations under this Section 6.10 and
the Parent consents to such transfer, which consent shall not unreasonably
CONFIDENTIAL
33
<PAGE>
be withheld. In the event that either Party proposes at any time after the
Closing Date to destroy any of such books and records, such Party shall give at
least sixty (60) days prior notice to the other Parties and shall, if the other
Parties so requests by notice within thirty (30) days of the notice, deliver to
the other Parties at such Parties' sole expense the books and records otherwise
to be destroyed.
6.11 Return of Inventory. The Parties agree that at any time after
-------------------
December 31, 1996, the Buyer shall have the right to return any item of
Inventory that the Buyer has not sold within ninety (90) days of the Closing
Date, to the Sellers for a full refund of the price paid for such item of
Inventory. The Buyer shall use its Best Efforts to sell the Inventory and shall
pay the reasonable shipping costs associated with any items of Inventory
returned by the Buyer pursuant to this section. The Parties further agree that
any items of Inventory returned pursuant to this Section 6.11 must be sent to
the Sellers for return within one hundred and fifty (150) days of the Closing
Date, and may not be returned to the Sellers on or before December 31, 1996.
6.12 Employment Matters.
------------------
(A) Within ten (10) days of the date hereof, the Buyer shall
provide written offers of employment to all of the Employees, at the
same or substantially the same overall compensation levels as in
effect on the date of this Agreement, effective as of and conditioned
upon the Closing. Such employment offers will be subject to the
Buyer's standard employment policies and practices and any employment
shall be at will and shall not be deemed to be pursuant to any
contract of employment, express or implied, and nothing shall limit
the Buyer's right to terminate any Employee's employment with or
without cause and with or without notice.
(B) The Sellers agree to terminate the employment of all
Business Employees, contractors and consultants with respect to the
Acquired Assets and the Business effective as of the end of business
on the Closing Date, and to give timely and legally sufficient notice
of termination to them.
(C) Nothing herein is intended to confer upon any employee of
the Sellers any rights of any kind whatsoever under or by reason of
this Agreement, including, without limitation, any rights to
employment for a specified period or any other form of employment
security. Except as otherwise specifically provided herein, the Buyer
shall have no Liability or obligation nor incur any cost or expense
with respect to any claims, whether arising before or after Closing,
by any employee or former employee of the Sellers arising by reason of
the sale or purchase of the Acquired Assets pursuant to this Agreement
or by reason of such employee or former employee's employment, or the
termination of his or her employment, by the Sellers. The Buyer shall
provide medical coverage under its current medical plan to the
Business Employees commencing on the day after the Closing Date.
Except as otherwise specifically provided herein, the Sellers shall
have no Liability or obligation nor incur any cost or expense with
respect to any claims arising after Closing, by any Business Employee
arising by reason of the sale or purchase of the Acquired Assets
pursuant to this Agreement or by
CONFIDENTIAL
34
<PAGE>
reason of such Business Employees employment, or the termination of
his or her employment, by the Buyer. Without limiting the foregoing,
any severance obligation arising by reason of the sale of the
Acquired Assets by the Sellers pursuant to this Agreement shall
remain the sole Liability of the Sellers.
ARTICLE 7 -- COVENANTS OF THE SELLERS
Each of the Sellers hereby covenant with the Buyer as follows:
7.1 Conduct of Business. For the period from the date hereof through
-------------------
the Closing Date with respect to the operation of the Business and maintenance
of the Acquired Assets and the Inventory:
(A) The Sellers shall carry on the Business in the Ordinary
Course of Business using their Best Efforts to: (i) maintain and
preserve in good operating condition and repair the Acquired Assets,
the Inventory and the Business in substantially the same manner as
heretofore conducted; (ii) retain the services of present officers,
Employees and agents of the Business; (iii) not engage in any business
practice that could reasonably be expected to damage the reputation of
the Business; (iv) preserve material business relationships of the
Business with customers, suppliers and others; (v) confer with Buyer
concerning operational matters of a material nature affecting the
Business; and (vi) otherwise periodically report to Buyer concerning
the Business, the Fixed Assets and the Inventory.
(B) Except as set forth on Schedule 7.1, no increase will be made
------------
in the compensation or rate of compensation payable or to become
payable to any Employee, and no arrangement or plan other than those
now in effect shall be adopted or committed for.
(C) Except as specifically indicated on Schedule 2.2(C) or
---------------
Schedule 4.15, the Sellers shall not, without the prior consent of the
-------------
Buyer, waive any material right, cancel any material contract,
material debt or claim, or assume or enter into any material contract,
lease, license, obligation, indebtedness, commitment, purchase or
sale. Without limiting the foregoing and except as specifically
indicated on Schedule 2.2(C) or Schedule 4.15, the Sellers shall
--------------- -------------
not, without the prior written consent of the Buyer, enter into any
discussions with any third party regarding any change or amendment to
any material contract, agreement, understanding, or established
business practice between the Sellers and any customer of the
Business.
(D) The Sellers shall not, without the prior written consent of
the Buyer, acquire or dispose of any capital asset used in the
Business having an original cost of more than $5,000 other than in the
Ordinary Course of Business. Prior to the Closing, the Sellers shall
not make any intercompany transfers related to the Business of assets
or indebtedness, without the prior written consent of the Buyer.
CONFIDENTIAL
35
<PAGE>
(E) The Sellers shall not, without the prior written consent of
the Buyer: (i) enter into, assume, permit or grant any Liens or
Encumbrance of any kind on any of the Acquired Assets; (ii) make any
capital contributions or investments in any corporation, business or
other Person related to the Business that competes with the Business;
(iii) sell, transfer, assign or otherwise dispose of any of the
Acquired Assets having an a Book Value in excess of $5,000; or (iv)
grant or convey any license or sublicense in the Business Intellectual
Property Rights to any Person.
7.2 Access and Information. The Sellers shall permit the Buyer,
----------------------
through its employees and representatives, including, without limitation, its
attorneys and accountants, to make such investigation of the assets, properties,
business and operations of the Sellers related to the Business and such
examination of the books, records and financial condition of the Sellers related
to the Business, as the Buyer wishes. Any such investigation and examination
shall be conducted at reasonable times and under reasonable circumstances and,
in any event, in a manner which shall cause no serious disruption of the
Sellers' operations. No investigation by the Buyer shall diminish or obviate
any of the representations, warranties, covenants or agreements of the Sellers
under this Agreement. Prior to the Closing Date, the Sellers shall furnish the
representatives of the Buyer with all such information and copies of such
documents concerning the affairs of the Sellers as such representatives may
reasonably request, and cause their officers, employees, consultants, agents,
accountants and attorneys to cooperate fully with such representatives in
connection with such review and examination.
7.3 Supplemental Disclosure. The Sellers shall promptly notify the
-----------------------
Buyer if any Schedule hereto needs to be updated, corrected or otherwise
modified with respect to any matter hereafter arising which, if existing or
occurring at the date of this Agreement, would have been required to be set
forth on or described in the Schedules. No such update, correction or
modification shall be deemed to cure any breach of any representation or
warranty herein unless agreed to in writing by the Buyer.
7.4 Exclusivity. At all times prior to termination of this Agreement
------------
pursuant to Article 11 below, the Sellers will not (i) solicit, initiate, or
encourage the submission of any proposal or offer from any Person relating to
the acquisition of the Business or of any substantial portion of the Acquired
Assets (including any acquisition structured as a merger, consolidation, or
share exchange) or (ii) participate in any discussions or negotiations
regarding, furnish any information with respect to, assist or participate in, or
facilitate in any other manner any effort or attempt by any Person to do or seek
any of the foregoing. The Sellers will notify the Buyer immediately if any
Person makes any proposal, offer, inquiry, or contact with respect to any of the
foregoing.
7.5 Discharge of Liabilities. At or prior to the Closing, the
------------------------
Sellers shall have obtained a release of any Liens or Encumbrances, other than
Permitted Liens, on the Acquired Assets and the Inventory.
CONFIDENTIAL
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7.6 Employee Benefits.
-----------------
(A) Subject to Section 2.5.(A), the Sellers shall retain sole
responsibility for all costs, Liabilities and obligations of any kind
(including, without limitation, all obligations imposed by ERISA or the Code)
with respect to, or arising in any way from, the employment, compensation or
benefits of any Employee or former Employee (including any benefits with respect
to an Employee's or former Employee's dependents), whether under any Plans,
contracts or otherwise, including, without limitation, (i) any amounts that are
payable or may have accrued to any Employee or former Employee, or that are in
any way attributable to such Employee's or former Employee's service with the
Seller, prior to or as of the Closing Date under the Sellers' health, life, and
long term disability insurance plans, (ii) any post-retirement medical, life
insurance or other benefit that is payable or may have accrued to any Employee
or former Employee, or that is in any way attributable to such Employee's or
former Employee's service with the Sellers, prior to or as of the Closing Date,
(iii) any accrued and unused vacation or sick leave, (iv) any severance benefits
of whatever nature that may be payable or will have accrued to any Employee or
former Employee as a result of the sale of the Acquired Assets to the Buyer
and/or the termination of the Employees' employment in connection therewith; and
(v) any Liabilities or obligations under the Consolidated Omnibus Budget
Reconciliation Act of 1985, as amended ("COBRA"). The Sellers shall retain all
Liabilities and obligations under any Pension Plan that the Sellers maintains or
maintained, or contributes or contributed to, on behalf of any Employees or
former Employees, including, without limitation, any obligations for unpaid
contributions as of the Closing Date, and the Buyer shall in no way assume any
Liabilities and obligations with respect to any Employees or former Employees
under or arising out of any Pension Plan that the Sellers maintains or
maintained, or contributes or contributed to, on behalf of any Employees or
former Employees.
(B) The Buyer shall in no way be responsible for any costs,
Liabilities and obligations arising out of, by reason of, or in connection with
any Employee's or former Employee's employment with the Sellers, including all
Liabilities and obligations relating to the Employee's or former Employee's
compensation and benefits, whether under any Plan, contract or otherwise, which
shall include, but shall not be limited to, the items enumerated in clauses (i)
through (v) of the first sentence of Section 7.6(A).
(C) The Buyer shall be responsible for any Liabilities and
obligations relating to the compensation and benefits of its employees as of the
Closing that may arise under any of the Buyer's plans covering such employees
and their dependents. The Sellers shall in no way be responsible for any
Liabilities and obligations relating to the compensation and benefits of the
Buyer's employees following the Closing that may arise under any contract
between the Buyer and its employees or under any plans that maintains or
contributes to on behalf of its employees.
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<PAGE>
(D) The Sellers shall have sole responsibility with respect to
any workers compensation claims with respect to its Employees that
arise out of occurrences on or prior to the Closing Date. The Buyer
shall have sole responsibility with respect to any workers
compensation claims with respect to any Employees who accept the
Buyer's offer of employment that arise out of occurrences after the
Closing Date.
(E) No Employee, whether hourly or salaried, shall be deemed to
be a third-party beneficiary of this Section or this Agreement.
7.7 Noncompetition. In consideration of the payment specified in
--------------
Section 3.3 above, the Sellers agree to execute and deliver a non-competition
agreement with the Buyer, in substantially the form attached hereto as Exhibit C
---------
(the "Non-Competition Agreement").
7.8 Tax Matters.
-----------
(A) The Sellers shall prepare, or cause to be prepared, and shall
file timely, or cause to be filed timely (taking into account all
applicable extensions of time), all Tax Returns of the Sellers for
taxable periods that end before or include the Closing Date that have
not been filed prior to such date. The Sellers shall prepare all such
returns in a manner that is consistent with past practice.
(B) The Sellers shall remit all Taxes collected by the Sellers
prior to the Closing Date under the color of law to appropriate taxing
jurisdictions.
7.9 Inventory. Except for their inventory of pagers, the Sellers
---------
shall use their Best Efforts to maintain typical inventory levels at each Sam's
Club Location, which levels on the Closing Date shall be sufficient for at least
a thirty (30) day period.
ARTICLE 8 -- CONDITIONS TO OBLIGATIONS OF THE BUYER TO CLOSE
Except as may be waived by the Buyer in writing, the obligations of
the Buyer to consummate the transactions contemplated by this Agreement is
subject to each of the following conditions:
8.1 Representations and Warranties. The representations and
------------------------------
warranties of the Sellers contained in this Agreement shall be true and complete
as of the date of this Agreement and (unless made as of a specified date) shall
be true and complete on and as of the Closing Date as though such
representations and warranties were made again at and as of such date.
8.2 Compliance with Agreement. On and as of the Closing Date, the
-------------------------
Sellers shall have performed and complied with all agreements and conditions
required by this Agreement to be performed and complied with by the Sellers
prior to or on the Closing Date.
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8.3 Officers' Certificates. The Sellers shall have delivered to the
----------------------
Buyer a certificate dated as of the Closing Date and duly executed on behalf of
the Sellers by an authorized officer of each of the Sellers to the effect that
the conditions set forth in Sections 8.1 and 8.2 above have been satisfied.
8.4 Absence of Litigation; No Violation of Statutes, etc. No
----------------------------------------------------
statute, rule, regulation, order, stay, injunction or decree shall have been
promulgated, enacted, entered or enforced, and no investigation or inquiry shall
be pending or, to the knowledge of the Buyer, threatened against the Sellers or
the Buyer, by any Governmental Authority, including, but not limited to,
Governmental Authorities with jurisdiction over antitrust matters, which would
prevent or make illegal the consummation of the transactions contemplated
hereby, which would impose additional conditions on the Parties hereto in order
to consummate the transactions contemplated hereby, or which could have a
Material Adverse Effect on the Acquired Assets, the Inventory or the Business.
8.5 Approval by the Board of Directors of the Sellers. This
-------------------------------------------------
Agreement and all transactions contemplated hereunder shall have been approved
by the board of directors and the stockholders, if required by law or otherwise
sought by the Sellers, of each of the Sellers, and the Buyer shall have received
from each of the Sellers a certificate dated as of the Closing Date evidencing
such approvals.
8.6 Governmental Approvals and Third Party Consents. On or prior to
-----------------------------------------------
the Closing Date, all applicable waiting periods (and any extensions thereof)
under the Hart-Scott-Rodino Act shall have expired or otherwise been terminated,
and all Consents and Governmental Approvals required to be obtained by the
Sellers, as a condition to the lawful consummation of the transactions
contemplated hereby shall have been obtained, including, but not limited to, any
and all Consents required under any Contract that any Seller is a party to, and
the Buyer shall have received copies of each such Consents and Governmental
Approvals in form and substance reasonably satisfactory to the Buyer. No such
required Consent or Governmental Approval shall have been withdrawn or suspended
as of the Closing Date.
8.7 Other Agreements. On or prior to the Closing Date, the following
----------------
agreements shall have been executed and delivered by the Parties thereto:
(A) A two (2) year supply and distribution agreement, between
Buyer and the Partnership providing for (i) the distribution by the Sellers of
all wireless communications equipment and related accessories and materials
purchased, including paging equipment, from the Seller or third parties to the
Sam's Club Locations, (ii) the right, but not the obligation, of Buyer to
purchase certain cellular telephone equipment from the Sellers and (iii) the
exclusive obligation of the Buyer to purchase certain cellular telephone
accessories from the Sellers [REDACTED]; provided, however, that the Buyer shall
-----------------
have the right to terminate the agreement at any time after 18 months if any of
the Sellers violate the terms of the Non-Competition Agreement as though such
agreement was still in force (the "Distribution Agreement"). The Distribution
Agreement also shall provide that (i) at least twenty (20) days before offering
any non OEM accessories for sale, and at least twenty (20) days before changing
from one style or manufacturer to another, the Partnership must ship at least
three random pieces to the Buyer for a ten day technical and quality
evaluation, (ii) Cellstar shall replace equipment which fails to meet the
Buyer's reasonable performance standards with equipment that does conform,
within thirty (30) days of notification, (iii) Cellstar will offer a [REDACTED]
warranty on all non-OEM batteries and a [REDACTED] warranty on all other non-OEM
accessories, and (iv) weekly inventory reporting on a per Sam's Club basis for
all products shipped by the Partnership under the Distribution Agreement.
(B) The Non-Competition Agreement;
(C) The National License Agreement with Sam's Club for the
retail operation of the kiosks in the Sam's Club Locations and the sale of
wireless telecommunications services in the kiosks, including, but not limited
to, cellular and PCS service (the "Sam's Club Agreement");
(D) The sublease agreement for the Commercial Lease Agreement,
dated February 2, 1995, between National Auto Center, Inc. and Ishida Texas,
Inc., pursuant to which the Buyer shall sublease the premises covered by the
Commercial Lease Agreement until
CONFIDENTIAL
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Brackets ([/]) indicate confidential portions omitted and filed separately with
the Commission.
39
<PAGE>
December 31, 1997 (the "Sublease Agreement"), which agreement shall be
in substantially in the form attached hereto as Exhibit D, and the
---------
Buyer carve out of the sublease, a portion of the leased
premises for use by certain of Seller's paging personnel;
(E) A six (6) month interim services and support agreement
between the Sellers and the Buyer for the provision of the following
services at the Sellers' actual cost (including overhead costs): (i)
system support for the Microstep point-of-sale system; (ii) support
from JD Edwards system for outsourcing (including file extracts),
purchase orders, receiving, inventory management and reporting
(including the deployment of data as needed by the Business); (iii)
technical support for (a) the Xcellenet system, (b) the computer
equipment employed in the Business and (c) the Microstep point-of-sale
system; (iv) any required transitional data processing, data entry
support, accounting and minor reporting enhancements services; (v) use
of the Seller's PBX equipment, and (vi) a license to the stylized
versions of the marks "Communication Center" and "Communication Center
Affiliates"(the "Interim Services Agreement"); and
(F) Assignment and Assumption Agreement, substantially in the
form attached hereto as Exhibit E.
---------
8.8 Opinion of Counsel. The Buyer shall have received from Sellers'
------------------
general counsel an opinion substantially in the form and substance attached
hereto as Exhibit F.
---------
8.9 Release of Liens. The Sellers shall have obtained a release of
----------------
any Liens or Encumbrances, other than Permitted Liens, on the Acquired Assets
and the Inventory and shall have provided the Buyer with evidence thereof,
including UCC termination statements for all jurisdictions where financing
statements have been filed in connection with such Liens or Encumbrances. All
of the Acquired Assets and the Inventory shall be delivered on the Closing Dates
free and clear of any Liens or Encumbrances, other than Permitted Liens.
8.10 Activation Contracts. Buyer shall have negotiated the Purchase
--------------------
Contracts or Activation Contracts to offer cellular services coverage to all of
the Sam's Club Locations; provided, however, that the conditions of this Section
-------- -------
8.10 shall be deemed to be satisfied if (a) the Buyer has negotiated Purchase
Contract or Activation Contracts with all but ten (10) of the Sam's Club
Locations and Wal-Mart Stores, Inc. has agreed to the Buyer not providing
cellular coverage in those locations, and (b) in the event that AT&T has not
assigned to the Buyer AT&T Purchase Contract for the twenty-one (21) Sam's Club
Locations located in Florida (the "AT&T Contract"), the Buyer and the Sellers
shall have executed an option agreement (the "Option Agreement"), pursuant to
which (i) the Seller's would continue to operate the twenty-one (21) Sam's Club
Locations in Florida currently served by the AT&T Contract (the "AT&T
Locations"), (ii) during the term, and subject to the provisions, of the AT&T
Contract (A) the Seller's agree to use their Best Efforts to sell the Buyer's
long distance and other services in the AT&T Locations, (B) subject to the
consent of Wal-Mart Stores, Inc., the Buyer would grant the Sellers a sublicense
under its Sam's Club Agreement pursuant to which the Seller's would operate the
AT&T Locations, (C) the Sellers shall have the right to operate kiosks in any
new Sam's Club Location in the Markets (as such term is defined in the AT&T
Contract) and the Buyer shall have the right to any new kiosks in Sam's Club
locations not in the Markets (as such term is defined in the AT&T Contract),
(D) an appropriate adjustment shall be made to the non-competition Agreement to
allow the Seller's to operate the AT&T Locations at the expiration of the term
of the AT&T Contract, and any new locations operated by the Sellers in
accordance with the terms of subsection (C) above, pursuant to the terms of the
AT&T contract, and (iii) not less than 90 days prior to the expiration of the
current term of the AT&T Contract (January 15, 1998), the Buyer shall have the
option to purchase the AT&T Locations at the expiration of the term of the AT&T
Contract and any other Sam's Club Locations operated by the Seller's under the
AT&T Contract, for a total purchase price of Twenty Thousand Dollars ($20,000)
per Sam's Club Location; provided, however, that if the Buyer decides not to
-------- -------
exercise its right to purchase the Sam's Club Locations covered by the AT&T
Contract at the expiration of the AT&T Contract, the sublicense shall
automatically extend for the AT&T Locations for the term of the Sam's Club
Agreement and shall be freely assignable by the Sellers without the consent of
the Buyer.
8.11 Employment Matters. On or prior to the Closing Date at least
------------------
eighty percent (80%) of the Employees that the Buyer makes offers of employment
to shall have accepted such offers of employment (the "Business Employees").
ARTICLE 9 -- CONDITIONS TO OBLIGATIONS OF THE SELLERS TO CLOSE
Except as may be waived by the Sellers in writing, the obligations of
the Sellers to consummate the transactions contemplated by this Agreement are
subject to each of the following conditions:
40
<PAGE>
9.1 Representations and Warranties. The representations and
------------------------------
warranties of the Buyer contained in this Agreement were true and complete when
made, and (unless made as of a specified date) shall be true and complete on and
as of the Closing Date as though such representations and warranties were made
on and as of such date.
9.2 Compliance with Agreement. On and as of the Closing Date, the
-------------------------
Buyer shall have performed and complied with all agreements and conditions
required by this Agreement to be performed and complied with by the Buyer prior
to or on the Closing Date.
9.3 Officer's Certificates. The Buyer shall have delivered to the
----------------------
Seller a certificate dated as of the Closing Date and duly executed on behalf of
the Buyer by any authorized officer of the Buyer with respect to the effect that
the conditions set forth Sections 9.1 and 9.2 above have been satisfied.
9.4 Absence of Litigation; No Violation of Statutes, etc. No
-----------------------------------------------------
statute, rule, regulation, order, stay, injunction or decree shall have been
promulgated, enacted, entered or enforced, and no investigation or inquiry shall
be pending or, to the knowledge of the Sellers, threatened against the Sellers
or the Buyer, by any Governmental Authority, including, but not limited to,
Governmental Authorities with jurisdiction over antitrust matters, which would
prevent or make illegal the consummation of the transactions contemplated
hereby, or which would impose additional conditions on the parties hereto in
order to consummate the transactions contemplated hereby.
9.5 Approval by the Board of Directors of the Buyer. This Agreement
-----------------------------------------------
and all transactions contemplated hereunder shall have been approved by the
board of directors and the stockholders, if required by law or otherwise sought
by the Buyer, of the Buyer, and the Sellers shall have received from the Buyer a
certificate dated as of the Closing Date evidencing such approvals.
9.6 Governmental Approvals and Third Party Consents. On or prior to
-----------------------------------------------
the Closing Date, all applicable waiting periods (and any extensions thereof)
under the Hart-Scott-Rodino Act shall have expired or otherwise been terminated,
and all Consents required to be obtained by the Buyers, as a condition to the
lawful consummation of the transactions contemplated hereby shall have been
obtained, and the Sellers shall have received copies of each such Consent in
form and substance satisfactory to the Sellers. No such required Consents shall
have been withdrawn or suspended as of the Closing Date.
9.7 Other Agreements. On or prior to the Closing Date, the following
----------------
agreements shall have been executed and delivered by the Parties thereto:
(A) The Distribution Agreement;
(B) The Interim Services Agreement;
(C) The Sublease Agreement;
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<PAGE>
(D) The Assignment and Assumption Agreement;and
(E) The termination and release from liability under the terms of
the National License Agreement between the Sellers and Sam's.
9.8 Payment of the Purchase Price. On the Closing Date, the Buyer
-----------------------------
shall deliver the Purchase Price to the Sellers.
ARTICLE 10 -- INDEMNIFICATION
10.1 Indemnification.
---------------
(A) Following Closing, the Sellers (jointly and severally) agree
to indemnify and hold harmless the Buyer and any director, officer,
employee and agent of the Buyer (as applicable, individually or
collectively "Buyer Group") from and against any and all demands,
claims, actions or causes of action, assessments, losses, damages,
Liabilities, costs and expenses, including without limitation,
interest, penalties, consequential damages and reasonable fees of
attorneys, accountants and other experts, disbursements and expenses
(collectively, "Damages"), arising out of, by reason of, or in
connection with:
(1) any Legal Proceeding arising out of or in connection
with any transaction or event involving the operation or
ownership of the Business or any of the Acquired Assets or the
Inventory, including without limitation any Legal Proceeding
relating to employment matters, which arose, occurred or is
attributable to acts, circumstances, omissions, conditions or
events existing on or prior to the Closing Date, or
(2) a breach or inaccuracy of any covenants, agreements,
representations or warranties made by the Sellers under this
Agreement;
(3) the bulk sales law as effective as of the Closing Date in
the applicable jurisdiction;
(4) all Taxes imposed on the Business, the Acquired Assets
or the Inventory, the Assumed Liabilities or the Buyer or any
Affiliate thereof as a result of operations relating to the
Business conducted prior to the Closing Date including Damages
incurred in the contest in good faith by appropriate proceedings
of the imposition, assessment or assertion of any such Taxes and
including any property taxes on the Acquired Assets or the
Inventory for the tax year that includes the Closing Date;
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<PAGE>
(5) any Liabilities with respect to an Employee's or former
Employee's employment with the Sellers, including all Liabilities
and obligations relating to the Employee's or former Employee's
compensation or benefits, whether under any Plan, contract or
otherwise, which shall include, but shall not be limited to, the
items enumerated in clauses (i) through (iv) of the first
sentence of this Section as well as any and all liabilities
associated with the Sellers' termination of the employment of
such Employees; and
(6) any failure to comply with the continuation health care
coverage requirements of Section 4980B of the Code and sections
601 through 608 of ERISA which failure occurred with respect to
any Employee or former Employee or any qualified beneficiary of
such Employee or former Employee (as defined in Section
4980B(g)(1) of the Code) on or prior to the Closing Date.
(B) Following the Closing, the Buyer agrees to indemnify and
hold harmless each of the Sellers and any director, officer, employee
and agent of such Seller (as applicable, individually or collectively
"Seller Group") from and against any and all Damages arising out of,
by reason of, or in connection with:
(1) any Legal Proceeding arising out of or in connection
with any transaction or event involving the operation or
ownership of the Business or any of the Acquired Assets or
Inventory, including without limitation any Purchased Contracts
or Legal Proceeding relating to employment matters, which arose,
occurred or is attributable to acts, circumstances, omissions,
conditions or events existing subsequent to the Closing Date;
(2) a breach or inaccuracy of any covenants, agreements,
representations or warranties made by the Buyer under this
Agreement; and
(3) all Taxes imposed on the Business, the Acquired Assets
or the Inventory, the Assumed Liabilities of the Sellers or any
Affiliate thereof as a result of operations relating to the
Business conducted subsequent to the Closing Date including
Damages incurred in the contest in good faith by appropriate
proceedings of the imposition, assessment or assertion of any
such Taxes but not including any property taxes on the Acquired
Assets or the Inventory for the tax year that includes the
Closing Date; or
(4) any Liabilities with respect to a Business Employee
employment with the Buyer, including all Liabilities and
obligations relating to the Business Employee compensation or
benefits, whether under any Plan, contract or otherwise,
including any and all liabilities associated with the Buyer's
termination of the employment of such Business Employees.
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<PAGE>
(C) Except as set forth in this Article 10, in no event shall
either Party be liable to the other for any special, incidental, or
consequential damages including lost profits whether or not such
damages were foreseeable. The Parties hereby agree to use their Best
Efforts to mitigate any Damages for which they may seek indemnity
under this Article 10.
(D) No Indemnified Party (as defined below) shall be entitled to
indemnification pursuant to this Article 10 unless and until the
amount of Damages due with respect to such claims exceeds, in the
aggregate, Fifty Thousand Dollars ($50,000) (the "Basket Amount"),
whereupon all amounts then or thereafter due (including, but not
limited to, the Basket Amount) shall be payable; provided, however,
-------- -------
that any indemnification arising under Section 10.1(A)(3) hereof shall
not be subject to the Basket Amount and the Indemnified Party
thereunder shall be entitled to indemnification pursuant to this
Article 10 for any and all amount of Damages due with respect to such
claims; provided, further, that the indemnity provided by each of the
Parties pursuant to this Article 10 shall be limited to the Purchase
Price.
10.2 Procedure. Any claim for Damages hereunder shall be made in
---------
writing (a "Claim") to the Buyer or the Sellers, as the case may be. Such
writing shall be delivered pursuant to the notice provision of this Agreement
and shall set forth the cause of action, or assert or allege the obligation
specifically covered by such claim, action, suit or similar matter. Subsequent
to the date of receipt of a Claim, the Party receiving such notice (the
"Indemnifying Party") shall (i) reimburse in cash (or pay on behalf of) the
Buyer Group or the Seller Group, as the case may be (the "Indemnified Party")
any Damages incurred (or which would otherwise be incurred) by the Indemnified
Party within ten (10) days of the indemnified party's delivery of any bills,
receipts, statements or other evidence of Damages, or (ii) give written notice
to the Indemnified Party that it contests such claim. If the Indemnifying Party
contests such claim in good faith (a "Disputed Claim"), then the Indemnified
Party and Indemnifying Party will proceed in good faith to negotiate a
resolution of such dispute, and if no resolution is reached within thirty (30)
days after the receipt by the Indemnified Party of the notice contesting the
Claim, the matter shall be resolved pursuant to Section 12.1 below.
10.3 Third Party Claims. The obligations and Liabilities of any of
------------------
the Parties to this Agreement under Section 10.1 hereof with respect to all
items indemnified against in Section 10.1 and which are initiated by third
parties (the "Third Party Claims") will be subject to the following terms and
conditions:
(A) Upon receipt of written notice of any Third Party Claim
asserted against, resulting from, imposed upon or incurred by the
Indemnified Party, the Indemnifying Party will undertake the defense
thereof by counsel of its own choosing, which counsel shall be
reasonably satisfactory to the Indemnified Party; provided, however,
-------- -------
that the Indemnified Party shall have the right at its own expense to
participate in the defense thereof and to employ counsel at its own
expense to assist in such defense; and provided, further, that if the
-------- -------
Indemnified Party has been advised in writing by such counsel that a
conflict of interest exists between such Indemnified Party and the
Indemnifying Party with respect to such Third Party
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<PAGE>
Claim, such Indemnified Party shall be entitled to select counsel of
its own choosing, in which event the Indemnified Party shall be
obligated to pay the reasonable fees and expenses of such counsel. In
any such defense, the Indemnified Party shall have the right, but not
the obligation, to assert any and all cross claims or counterclaims it
may have. In case any Third Party Claim shall be instituted involving
any Person in respect of which indemnity may sought pursuant to this
Article 10, such Indemnified Party shall promptly notify the
Indemnifying Party in writing of such proceeding. No indemnification
provided for in Section 10.1 above shall be available to any Person
who shall fail to promptly give notice of a Third Party Claim as
provided in the immediately preceding sentence if the Person to whom
such notice was not given was unaware of the Third Party Claim to
which such notice would have related and was materially prejudiced by
the failure to receive such notice.
(B) If within a reasonable time after written notice of any
Third Party Claim, the Indemnifying Party fails to defend the
Indemnified Party against whom such Third Party Claim has been
asserted or shall fail to diligently prosecute such defense or
compromise such claim, the Indemnified Party will have the right, with
counsel of its own choice, at the Indemnifying Party's expense, to
undertake the defense, compromise or settlement of such Third Party
Claim on behalf of and for the account and at the risk of the
Indemnifying Party.
(C) Nothing in this Section 10.3 to the contrary, the
Indemnifying Party will not, without the prior written consent of each
Indemnified Party against whom a Third Party Claim is asserted, settle
or compromise, any claim or consent to the entry of any judgment
relating to any such Third Party Claim, unless such settlement,
compromise or judgment includes as an unconditional term thereof the
giving by the claimant or the plaintiff to each Indemnified Party
against whom a Third Party Claim is asserted, a release from all
Liabilities in respect of such Third Party Claim and does not result
in the imposition on the Indemnified Party of any remedy other than
monetary damages up to the amount to be paid with respect to such
claim by the Indemnifying Party pursuant to Section 10.1.
(D) The Indemnifying Party will, at its expense, provide each
Indemnified Party against whom a Third Party Claim is asserted with
reasonable access to all records and documents of the Indemnifying
Party relating to any Third Party Claim. The Indemnified Party, at the
expense of the Indemnifying Party, will provide the Indemnifying Party
with reasonable access to all records and documents of the Indemnified
Party relating to any Third Party Claim.
ARTICLE 11 -- TERMINATION AND SURVIVAL
CONFIDENTIAL
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11.1 Termination. This Agreement may be terminated and the
-----------
transactions contemplated hereby may be abandoned:
(A) at any time before the Closing by mutual written agreement
of the Seller and the Buyer;
(B) by either the Sellers, on the one hand, or the Buyer, on the
other hand, if, without the fault of such terminating Party, the
Closing shall not have taken place prior to October 31, 1996; or
(C) by the Sellers, on the one hand, or the Buyer, on the other
hand, if any court of competent jurisdiction in the United States
shall have issued an order, stay, injunction or decree preventing the
transactions contemplated by this Agreement, and such order, stay,
injunction or decree shall have become final and non-appealable.
11.2 Effect of Termination. If this Agreement is validly terminated
---------------------
pursuant to Section 11.1, this Agreement will forthwith become null and void,
and there will be no Liability or obligation on the part of the Sellers or the
Buyer (or any of their respective officers, directors, employees, agents or
other representatives or Affiliates), except that the provisions with respect to
arbitration and expenses in Sections 12.1 and 12.4, respectively, will continue
to apply following any such termination and that such termination shall not
constitute a waiver or bar by any Party of any rights or remedies at law or in
equity they may have for damages caused by reason of a breach of this Agreement
by the other Party. In addition, termination of this Agreement for any reason
shall not terminate the obligations of the Parties under Section 6.9, which
obligations shall continue for a period of three (3) years after such
termination.
11.3 Survival. All of the representations and warranties set forth
--------
herein shall survive the Closing without limitation. All covenants and
agreements set forth herein shall survive the Closing Date and shall continue
until the latter of (i) the performance, satisfaction or termination, each in
accordance with their terms, of such covenants and agreements, or (ii) three (3)
years from the Closing Date. Any right of indemnification provided for herein
shall survive for a period of three (3) years from the Closing Date, except for
indemnification with respect to tax matters in Section 4.10 (without regard to
the exceptions provided therein), which shall survive until the expiration of
the applicable statute of limitation period. Notwithstanding the foregoing or
the provisions of Article 10, if any claim or other matter is attributable to
any fraud or intentional deceit on the part of any Seller, on the one hand, or
the Buyer, on the other hand, as the case may be, then the indemnification
provided herein shall survive for the duration of the applicable statute of
limitations.
CONFIDENTIAL
46
<PAGE>
ARTICLE 12 -- MISCELLANEOUS
12.1 Arbitration. Without prejudice to any Party's right to seek
-----------
equitable relief (including, but not limited to, injunction) from a court, any
dispute arising out of or related to this Agreement, which cannot be resolved by
negotiation, shall be settled by binding arbitration in accordance with the
J.A.M.S./ENDISPUTE Arbitration Rules and Procedures ("Endispute Rules"), as
amended by this Agreement. The costs of arbitration, including the fees and
expenses of the arbitrator, shall be shared equally by the Parties unless the
arbitration award provides otherwise. Each Party shall bear the cost of
preparing and presenting its case. The Parties agree that this provision and
the Arbitrator's authority to grant relief shall be subject to the United States
Arbitration Act, 9 U.S.C. 1-16 et seq. ("USAA"), the provisions of this
Agreement, and the ABA-AAA Code of Ethics for Arbitrators in Commercial
Disputes. The Parties agree that the arbitrator shall have no power or
authority to make awards or issue orders of any kind except as expressly
permitted by this Agreement, and in no event shall the arbitrator have the
authority to make any award that provides for punitive or exemplary damages.
The arbitrator's decision shall follow the plain meaning of the relevant
documents, and shall be final and binding. The award may be confirmed and
enforced in any court of competent jurisdiction. All post-award proceedings
shall be governed by the USAA.
12.2 Notices. All notices, requests, demands, or other
-------
communications required or permitted hereunder shall be in writing, shall be
deemed delivered (i) on the date of delivery when delivered by hand, (ii) on the
date of transmission when sent by telex, electronic mail or facsimile
transmission during normal business hours with telephone confirmation of
receipt, (iii) one (1) day after dispatch when sent by overnight courier
maintaining records of receipt, or (iv) three (3) days after dispatch when sent
by registered mail, postage prepaid, return-receipt requested, all addressed as
follows (or at such other addresses as shall be given in writing by either Party
to the other):
If to the Buyer:
MCI Telecommunications Corporation
1200 S. Hayes Street
Arlington, VA 22202
Attn: Terry Macko
Vice President
Fax: (703) 415-6789
with a copy to:
MCI Telecommunications Corporation
1801 Pennsylvania Avenue, N.W.
Washington, D.C. 20006
Attn: General Counsel
Fax: (202) 887-2047
CONFIDENTIAL
47
<PAGE>
If to the Sellers:
CellStar Corporation
National Auto Center, Inc.
CellStar, Ltd.
1730 Briercroft Court
Carrollton, TX 75006
Attn: Alan H. Goldfield
Chairman and CEO
Fax: (214) 466-0288
with a copy to:
Attn: General Counsel
Fax: (214) 466-0288
with an additional copy to:
Attn: Chief Financial Officer
Fax: (214) 466-0288
12.3 Entire Agreement. This Agreement (including the Schedules and
----------------
Exhibits hereto) supersedes the Letter of Intent, effective August 6, 1996, the
Confidential Disclosure Agreement, dated February 23, 1996, between the Parent
and MCI Communications Corporation and all other prior discussions and
agreements between the Parties with respect to the subject matter hereof, and
contains the sole and entire agreement between the Parties hereto with respect
to the subject matter hereof and thereof.
12.4 Expenses. Except as otherwise expressly provided in this
--------
Agreement, whether or not the transactions contemplated hereby are consummated,
each Party will pay its own costs and expenses incurred in connection with the
negotiation, execution and closing of this Agreement and the transactions
contemplated hereby.
12.5 Waiver. Any term or condition of this Agreement may be waived
------
at any time by the party that is entitled to the benefit thereof, but no such
waiver shall be effective unless set forth in a written instrument duly executed
by or on behalf of the party waiving such term or condition. No waiver by any
Party of any term or condition of this Agreement, in any one or more instances,
shall be deemed to be or construed as a waiver of the same or any other term or
condition of this Agreement on any future occasion. All remedies, either under
this Agreement or by law or otherwise afforded, will be cumulative and not
alternative.
12.6 Amendment. This Agreement may be amended, supplemented or
---------
modified only by a written instrument duly executed by or on behalf of each
Party hereto.
12.7 No Third Party Beneficiary. The terms and provisions of this
--------------------------
Agreement are intended solely for the benefit of each party hereto and their
respective permitted successors or assigns, and
CONFIDENTIAL
48
<PAGE>
it is not the intention of the Parties to confer third-party beneficiary rights
upon any other person other than any person entitled to indemnity under this
Agreement.
12.8 No Assignment, Binding Effect. Neither this Agreement nor any
-----------------------------
right, interest or obligation hereunder may be assigned by any party hereto
without the prior written consent of the other Party hereto and any attempt to
do so will be void, except (i) for assignments and transfers by operation of
law, and (ii) that the Buyer may assign any or all of its rights, interests and
obligations hereunder to an Affiliate of the Buyer with the consent of the
Parent, which consent shall not unreasonably be withheld. Subject to the
preceding sentence, this Agreement is binding upon, inures to the benefit of and
is enforceable by the Parties hereto and their respective permitted successors
and assigns.
12.9 Headings. The headings used in this Agreement have been
--------
inserted for convenience of reference only and do not define or limit the
provisions hereof.
12.10 Schedules, Exhibits and Other Agreements. The Schedules,
----------------------------------------
Exhibits, and other agreements specifically referred to in and delivered
pursuant to this Agreement are incorporated herein and shall be part of this
Agreement for all purposes.
12.11 Severability. In the event that any provision of this
------------
Agreement shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby, and this Agreement shall be construed as if such provision or
clause had never been contained in this Agreement, and there shall be deemed
substituted therefor such other provisions or clauses as will most nearly
accomplish the intent of the Parties expressed therein to the fullest extent
permitted by law.
12.12 Governing Law. Except as provided in Section 12.1, this
-------------
Agreement shall be governed by and construed in accordance with the laws of the
State of New York, without giving effect to the conflict of laws provisions
thereof.
12.13 Counterparts. The Agreement may be executed in counterparts,
------------
each of which will be deemed an original, but all of which together will
constitute one and the same instrument.
12.14 Specific Performance. The Buyer and the Sellers recognize that
--------------------
any breach of the terms of this Agreement may give rise to irreparable harm for
which money damages would not be an adequate remedy, and accordingly agree that,
in addition to other remedies any non-breaching party shall be entitled to
enforce the terms of this Agreement by a decree of specific performance without
the necessity of proving the inadequacy of money damages as a remedy.
12.15 Construction of Certain Terms and Phrases. Unless the content
-----------------------------------------
of this Agreement otherwise requires, (i) words of any gender include each other
gender; (ii) words using the singular or plural number also include the plural
or singular number, respectively; (iii) "knowledge", as used with respect to the
representations and warranties of this Agreement, means and includes: (a) actual
CONFIDENTIAL
49
<PAGE>
knowledge (which shall be the actual knowledge of any of the officers and
directors of the entity whose knowledge is referred to ins such representations
and warranties) and (b) that knowledge which a prudent business person should
have obtained in the management of his business; and (iv) whenever this
Agreement refers to a number of days, such number shall refer to calendar days.
12.16 Bulk Sales Laws. The Parties hereto waive compliance with the
---------------
"bulk sales" provisions of Article 6 of the Uniform Commercial Code as it is in
effect in the states where the Sellers own Acquired Assets to be conveyed to the
Buyer hereunder and any other "bulk sales" law of any jurisdiction that is
applicable to the transactions contemplated hereby.
[The Remainder of This Page Intentionally Left Blank]
CONFIDENTIAL 50
<PAGE>
IN WITNESS WHEREOF, the Parties hereto have entered into this Asset
Purchase Agreement as of the date first hereinabove written.
BUYER: SELLERS:
MCI TELECOMMUNICATIONS NATIONAL AUTO CENTER, INC.
CORPORATION
By: /s/ Wayne Huyard By: /s/ Richard M. Gozia
------------------------------ -----------------------------------
Name: Wayne Huyard Name: Richard M. Gozia
----------------------------- ----------------------------------
Title: President, Mass Markets Title: Executive Vice President
---------------------------- ---------------------------------
CELLSTAR LTD.
By: National Auto Center, Inc.,
Its General Partner
By: /s/ Richard M. Gozia
-----------------------------------
Name: Richard M. Gozia
----------------------------------
Title: Executive Vice President
---------------------------------
CELLSTAR CORPORATION
By: /s/ Richard M. Gozia
-----------------------------------
Name: Richard M. Gozia
----------------------------------
Title: Executive Vice President
---------------------------------
CONFIDENTIAL 51
<PAGE>
EXHIBIT 10.3
AGREEMENT
This Agreement is entered into between Motorola, Inc., by and through its Pan
American Cellular Subscriber Group, having a place of business at 600 North U.S.
Highway 45, Libertyville, Illinois 60048-1286 (hereinafter "Seller" or
"MOTOROLA") and CellStar, Ltd., with a place of business at 1730 Briercroft
Drive, Carrollton, Texas 75006 (hereinafter "Buyer").
Buyer agrees to purchase and Seller agrees to sell [REDACTED] cellular
subscriber units (hereinafter "Products") over a term beginning January 1, 1996
and ending December 31, 1996 ("Initial Term"), under the terms and conditions
set forth in this Agreement including the following attachments:
. Attachment A - Products and Prices
. Attachment B - Terms and Conditions
. Attachment C - Supplemental Terms and Conditions
. Attachment D - Limited Warranty
. Attachment E - CellStar Authorized Markets
Premier Line and Signature Line cellular subscriber units may only be purchased
by Buyer under terms contained in a separate written agreement with Motorola
applicable to those products.
Buyer also agrees to purchase and Seller agrees to sell cellular subscriber
accessories (hereinafter "Accessories") during the Initial Term under the terms
and conditions set forth in the following attachment:
. Attachment F - Accessories Program.
This Agreement constitutes the entire and final expression of agreement between
the parties pertaining to the subject matter hereof and supersedes all other
communications between the parties.
Unless this Agreement is superseded by a new agreement, or otherwise terminated
pursuant to the terms contained herein, this Agreement will continue in effect
beyond its initial term until terminated by either party upon thirty (30) days'
prior written notice.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by
their duly authorized representatives effective as of January 1, 1996.
MOTOROLA, INC. CELLSTAR LTD.
By: National Auto Center, Inc.
/s/ WOLF PAVLOK General Partner
- --------------------------
Wolf Pavlok
Senior Vice President and General Manager
Pan American Cellular Subscriber Group
DATE: 9/16/96
/s/ SUZETTE STEIGER /s/ALAN H. GOLDFIELD
- --------------------------- ---------------------------------
Suzette Steiger Alan H. Goldfield
Corporate Vice President and General Manager Chairman of the Board and CEO
U.S. Markets Division
Pan American Cellular Subscriber Group
DATE: ____________________ DATE: __________________________
Distributor Business Confidential Proprietary Rev. 6.4
Do Not Copy or Reproduce Cover
THIS AGREEMENT HAS CONFIDENTIAL PORTIONS OMITTED,
WHICH PORTIONS HAVE BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION. OMITTED
PORTIONS ARE INDICATED IN THIS AGREEMENT WITH
BRACKETS ([ ]).
- --------------
Brackets ([/]) indicate confidential portions omitted and filed separately with
the Commission.
<PAGE>
Confidential Business Information - Do Not copy or reproduce
AMENDMENT TO THE LETTER OF AGREEMENT
BETWEEN MOTOROLA AND CELLSTAR
ATTACHMENT A - PRICING
WIRELINE AMPS PRODUCT DISTRIBUTION
----------------------------------
Effective July 18, 1996
<TABLE>
<CAPTION>
PORTFOLIO PRODUCTS Model Includes [REDACTED]
- ------------------ ----- --------
<S> <C> <C>
2800 Mobile 19008WAMS HANDS FREE
3 YR WARRANTY
2800 Attache w/o Battery 19020WAAS 3 YR WARRANTY
2800 Attache with Battery 19021WAAB 3 YR WARRANTY
BATTERY & CHGR. KIT
2900 Lunchbox w/o Battery 19103WALB 3 YR WARRANTY
2900 Lunchbox with Battery 19102WALS 3 YR WARRANTY
BATTERY & CHGR. KIT
Power PAK w/o Battery 19133WAJS 3 YR WARRANTY
Power PAK with Battery 19145WAJD 3 YR WARRANTY
BATTERY & CHGR. KIT
Classic II 89003WAUD 1 YR WARRANTY
Ultra Classic II Base Model 89005WACB 1 YR WARRANTY
STANDARD BATTERY
DPC 550 34013WARS 1 YR WARRANTY
OVERNIGHT DESK TOP CHARGER
NiCd STANDARD BATTERY
DPC 550 Travel Pak 34006WARE 1 YR WARRANTY
NiCd STANDARD BATTERY
AC CHARGER TRANSFORMER
Micro TAC Ultra Lite Base Model 76289WNTB 1 YR WARRANTY
NiMH SLIM BATTERY
INTELLICHARGE XT
</TABLE>
All units include 2% cooperative promotion Allowance; application of which must
be according to the standard Motorola Cooperative Promotion Allowance Program as
revised January 1994.
- --------------
Brackets ([/]) indicate confidential portions omitted and filed separately with
the Commission.
<PAGE>
Confidential Business Information - Do Not copy or reproduce
AMENDMENT TO THE LETTER OF AGREEMENT
BETWEEN MOTOROLA AND CELLSTAR
ATTACHMENT A - PRICING
WIRELINE AMPS PRODUCT DISTRIBUTION
----------------------------------
Effective July 18, 1996
<TABLE>
<CAPTION>
PREMIER PRODUCTS Model Includes [REDACTED]
- ---------------- ----- --------
<S> <C> <C>
Contour 76544WANB 1 YR WARRANTY
NiCd BATTERY
AC CHARGER/TRANSFORMER
DPC 650 76359WADB 1 YR WARRANTY
SLIM NiCd Bauery
SLOW DESK TOP CHARGER
DPC 650 Olympic Package 76522WADS 1 YR WARRANTY
NEW, LIGHTWEIGHT NiMH BATTERY
RAPID CHARGER BASE & TRANSFORMER
VINYL CASE
COMMEMORATIVE OLYMPIC PIN
Micro TAC Lite II Entry PAK 76093WAHB 1 YR WARRANTY
SLIM NiCd BATTERY
SLOW DESK TOP CHARGER
Micro TAC Lite II Olympic Package 76480WAHS 1 YR WARRANTY
NEW, LIGHTWEIGHT NiMH BATTERY
FAST CHARGER BASE & TRANSFORMER
VINYL CASE
COMMEMORATIVE OLYMPIC PIN
Micro TAC Lite II Pro PAK 76096WAHP 3 YR WARRANTY
With Vibracall SLIM NiMH BATTERY
RAPID DESK TOP CHARGER
Micro TAC Elite NiMH Entry PAK 76730WNXS 1 YR WARRANTY
With Answering Machine SLIM NIMH BATTERY
AC CHARGER
ANSWERING MACHINE
Micro TAC Elite NiMH Olympic Package 76489WNXS 1 YR WARRANTY
With Answering Machine SLIM NIMH BATTERY
ELITE INTERNAL CHARGER
ANSWERING MACHINE
USER VIDEO
LEATHER CASE
COMMEMORATIVE OLYMPIC PIN
</TABLE>
All units include 2% cooperative promotion Allowance; application of which must
be according to the standard Motorola Cooperative Promotion Allowance Program as
revised January 1994.
[REDACTED]
- --------------
Brackets ([/]) indicate confidential portions omitted and filed separately with
the Commission.
<PAGE>
Confidential Business Information - Do Not copy or reproduce
AMENDMENT TO THE LETTER OF AGREEMENT
BETWEEN MOTOROLA AND CELLSTAR
ATTACHMENT A - PRICING
WIRELINE AMPS PRODUCT DISTRIBUTION
----------------------------------
Effective July 18, 1996
<TABLE>
<CAPTION>
PORTFOLIO PRODUCTS Model [REDACTED]
- ------------------ -----
<S> <C>
2800 Mobile 19008WAMS
2800 Attache w/o Battery 19020WAAS
2800 Attache with Battery 19021WAAB
2900 Lunchbox w/o Battery 19103WALB
2900 Lunchbox with Battery 19102WALS
Power PAK w/o Battery 19133WAJS
Power PAK with Battery 19145WAJD
Classic II 89003WAUD
Ultra Classic II Base Model 89005WACB
DPC 550 34013WARS
DPC 550 Travel Pak 34006WARE
Micro TAC Ultra Lite Base Model 76289WNTB
</TABLE>
These rebates are accrued at shipment and are payable as account credits
following the payment of the Motorola shipment invoice, and provided your
Motorola receivables account is current.
- ----------------
Brackets ([/]) indicate confidential portions omitted and filed separately with
the Commission.
<PAGE>
Confidential Business Information - Do Not copy or reproduce
AMENDMENT TO THE LETTER OF AGREEMENT
BETWEEN MOTOROLA AND CELLSTAR
ATTACHMENT A - PRICING
WIRELINE AMPS PRODUCT DISTRIBUTION
----------------------------------
Effective July 18, 1996
<TABLE>
<CAPTION>
PREMIER PRODUCTS Model [REDACTED]
- ---------------- -----
<S> <C>
Contour 76544WANB
DPC 650 76359WADB
DPC 650 Olympic Package 76522WADS
Micro TAC Lite II Entry PAK 76093WAHB
Micro TAC Lite II Olympic Package 76480WAHS
Micro TAC Lite II Pro PAK 76096WAHP
With Vibracall
Micro TAC Elite NiMH Entry PAK 76730WNXS
With Answering Machine
Micro TAC Elite NiMH Olympic Package 76489WNXS
With Answering Machine
</TABLE>
These rebates are accrued at shipment and are payable as account credits
following the payment of the Motorola shipment invoice, and provided your
Motorola receivables account is current.
- ----------------
Brackets ([/]) indicate confidential portions omitted and filed separately with
the Commission.
<PAGE>
Confidential Business Information - Do Not copy or reproduce
AMENDMENT TO THE AGREEMENT
BETWEEN MOTOROLA AND CELLSTAR
ATTACHMENT A - PRICING
NON-WIRELINE PRODUCT DISTRIBUTION
---------------------------------
Effective July 18, 1996
<TABLE>
<CAPTION>
PORTFOLIO PRODUCTS Model Includes [REDACTED]
- ------------------ ----- --------
<S> <C> <C>
Power PAK 150 19134NAJS 3 YR WARRANTY
(Without Battery)
Power PAK 150 19146NAJD 3 YR WARRANTY
(With Battery) BATTERY & CHGR. KIT
TX400 Mobile Phone 19005NAMS 3 YR WARRANTY
FULL DUPLEX
HANDS FREE
TX400 Attache Phone 19017NAAB 3 YR WARRANTY
(Without Battery)
TX400 Attache Phone 19016NAAS 3 YR WARRANTY
(With Battery) BATTERY & CHGR. KIT
TX400 Carry Phone 19096NALS 3 YR WARRANTY
(With Battery) BATTERY & CHGR. KIT
TX400 Carry Phone 19097NALB 3 YR WARRANTY
(Without Battery)
Classic II 89004NACB 1 YR WARRANTY
STD. BATTERY
Ultra Classic II Base Model 89006NAUB 1 YR WARRANTY
STD. BATTERY
DPC 550 34014NARS 1 YR WARRANTY
NiCd STANDARD (TALK
PAK) BATTERY
SLOW CHARGER BASE &
TRANSFORMER
DPC 550 Travel Pak 34007NARE 1 YR WARRANTY
NiCd STANDARD (TALK
PAK) BATTERY
AC CHARGER TRANSFORMER
Micro TAC Ultra Lite Base 76290NATB 1 YR WARRANTY
Model with VibraCall/TM/ NiMH SLIM BATTERY
INTELLICHARGE XT
</TABLE>
All units include 2% cooperative promotion allowance; application of which must
be according to the Motorola Cellular Co-op Advertising and Promotion Plan as
revised January 1994.
- --------------
Brackets ([/]) indicate confidential portions omitted and filed separately with
the Commission.
<PAGE>
Confidential Business Information - Do Not copy or reproduce
AMENDMENT TO THE AGREEMENT
BETWEEN MOTOROLA AND CELLSTAR
ATTACHMENT A - PRICING
NON-WIRELINE PRODUCT DISTRIBUTION
---------------------------------
Effective July 18, 1996
<TABLE>
<CAPTION>
PREMIER PRODUCTS Model Includes [REDACTED]
- ---------------- ----- --------
<S> <C> <C>
Courier 76193NANB 1 YR WARRANTY
EAGLE NiCd BATTERY
AC CHARGER TRANSFORMER
Piper 76358NADB 1 YR WARRANTY
SLIM NiCd BATTERY
SLOW CHARGER BASE &
TRANSFORMER
Piper Olympic Package 76523NADS 1 YR WARRANTY
NEW, LIGHTWEIGHT
NiMH BATTERY RAPID
CHARGER BASE &
TRANSFORMER
VINYL CASE
COMMEMORATIVE OLYMPIC PIN
Micro TAC Lite XL Entry PAK 76138NAHB 1 YR WARRANTY
NiCd STANDARD BATTERY
SLOW CHARGER & TRANSFORMER
Micro TAC Lite XL Pro PAK 76098NAHP 3 YR WARRANTY
with VibraCall/TM/ SLIM NiMH BATTERY
FAST CHARGER & TRANSFORMER
Micro TAC Lite XL Olympic 76481NAHS 1 YR WARRANTY
Package NEW, LIGHTWEIGHT NiMH
BATTERY FAST CHARGER
BASE & TRANSFORMER
VINYL CASE
COMMEMORATIVE OLYMPIC PIN
Micro TAC Elite NiMH Entry PAK 76731NAXE 1 YR WARRANTY
With Answering Machine SLIM NIMH BATTERY
ELITE INTERNAL CHARGER
Micro TAC Elite NiMH Olympic 76493NAXS 1 YR WARRANTY
Package With Answering Machine SLIM NIMH BATTERY
ELITE INTERNAL CHARGER
USER VIDEO
LEATHER CASE
COMMEMORATIVE OLYMPIC PIN
</TABLE>
All units include 2% cooperative promotion allowance; application of which must
be according to the Motorola Cellular Co-op Advertising and Promotion Plan as
revised January 1994.
- --------------
Brackets ([/]) indicate confidential portions omitted and filed separately with
the Commission.
<PAGE>
Confidential Business Information - Do Not copy or reproduce
AMENDMENT TO THE AGREEMENT
BETWEEN MOTOROLA AND CELLSTAR
ATTACHMENT A - PRICING
NON-WIRELINE PRODUCT DISTRIBUTION
---------------------------------
Effective July 18, 1996
<TABLE>
<CAPTION>
PORTFOLIO PRODUCTS Model [REDACTED]
- ------------------ -----
<S> <C>
Power PAK 150 19134NAJS
(Without Battery)
Power PAK 150 19146NAJD
(With Battery)
TX400 Mobile Phone 19005NAMS
TX400 Attache Phone 19017NAAB
(Without Battery)
TX400 Attache Phone 19016NAAS
(With Battery)
TX400 Carry Phone 19096NALS
(With Battery)
TX400 Carry Phone 19097NALB
(Without Battery)
Classic II 89004NACB
Ultra Classic II Base Model 89006NAUB
DPC 550 34014NARS
DPC 550 Travel Pak 34007NARE
Micro TAC Ultra Lite Base Model 76290NATB
with VibraCall/TM/
</TABLE>
These rebates are accrued at shipment and are payable as account credits
following the payment of the Motorola shipment invoice, and provided your
Motorola receivables account is current.
- ----------------
Brackets ([/]) indicate confidential portions omitted and filed separately with
the Commission.
<PAGE>
Confidential Business Information - Do Not copy or reproduce
AMENDMENT TO THE AGREEMENT
BETWEEN MOTOROLA AND CELLSTAR
ATTACHMENT A - PRICING
NON-WIRELINE PRODUCT DISTRIBUTION
---------------------------------
Effective July 18, 1996
<TABLE>
<CAPTION>
PREMIER PRODUCTS Model [REDACTED]
- ---------------- -----
<S> <C>
Courier 76193NANB
Piper 76358NADB
Piper Olympic Package 76523NADS
Micro TAC Lite XL Entry PAK 76138NAHB
Micro TAC Lite XL Pro PAK 76098NAHP
with VibraCall/TM/
Micro TAC Lite XL Olympic Package 7648lNAHS
Micro TAC Elite NiMH Entry PAK 76731NAXE
With Answering Machine
Micro TAC Elite NiMH Olympic Package 76493NAXS
With Answering Machine
</TABLE>
These rebates are accrued at shipment and are payable as account credits
following the payment of the Motorola shipment invoice, and provided your
Motorola receivables account is current.
- ----------------
Brackets ([/]) indicate confidential portions omitted and filed separately with
the Commission.
<PAGE>
Confidentlal Business Information - Do Not copy or reproduce
AMENDMENT TO THE LETTER OF AGREEMENT
BETWEEN MOTOROLA AND CELLSTAR
ATTACHMENT A - PRICING
WIRELINE NAMPS PRODUCT DISTRIBUTION
-----------------------------------
Effective July 18, 1996
<TABLE>
<CAPTION>
PORTFOLIO PRODUCTS Model Includes [REDACTED]
- ------------------ ----- --------
<S> <C> <C>
2900 Mobile 19052WNMS HANDS FREE
3 YR WARRANTY
2900 Attache w/o Battery 19067WNAB 3 YR WARRANTY
2900 Attache with Battery 19066WNAS 3 YR WARRANTY
BATTERY & CHGR. KIT
2900 Lunchbox w/o Battery 19087WNLB 3 YR WARRANTY
2900 Lunchbox with Battery 19086WNLS 3 YR WARRANTY
BATTERY & CHGR. KIT
Power PAK w/o Battery 19135WNJS 3 YR WARRANTY
Power PAK with Battery 19147WNJD 3 YR WARRANTY
BATTERY & CHGR. KIT
Classic II 89011WNCB 1 YR WARRANTY
Ultra Classic II Base Model 89013WNUB 1 YR WARRANTY
STANDARD BATTERY
DPC 550 34015WNRS 1 YR WARRANTY
OVERNIGHT DESK TOP CHARGER
NiCd STANDARD PAK
DPC 550 Travel Pak 34008WNRE 1 YR WARRANTY
NiCd STANDARD BATTERY
AC CHARGER TRANSFORMER
Micro TAC Ultra Lite Base Model 76289WNTB 1 YR WARRANTY
NiMH SLIM BATTERY
INTELLICHARGE XT
</TABLE>
All units include 2% cooperative promotion Allowance; application of which must
be according to the standard Motorola Cooperative Promotion Allowance Program as
revised January 1994.
- --------------
Brackets ([/]) indicate confidential portions omitted and filed separately with
the Commission.
<PAGE>
Confidential Business Information - Do Not copy or reproduce
AMENDMENT TO THE LETTER OF AGREEMENT
BETWEEN MOTOROLA AND CELLSTAR
ATTACHMENT A - PRICING
WIRELINE NAMPS PRODUCT DISTRIBUTION
-----------------------------------
Effective July 18, 1996
<TABLE>
<CAPTION>
PREMIER PRODUCTS Model Includes [REDACTED]
- ---------------- ----- --------
<S> <C> <C>
Contour 76546WNNB 1 YR WARRANTY
NiCd BATTERY
AC CHARGER/TRANSFORMER
Micro TAC DPC 650 76361WNDB 1 YR WARRANTY
SLIM NiCd Battery
SLOW DESK TOP CHARGER
Micro TAC DPC 650 Olympic Package 76524WNDS 1 YR WARRANTY
NEW, LIGHTWEIGHT NiMH
BATTERY RAPID CHARGER
BASE & TRANSFORMER
VINYL CASE
COMMEMORATIVE OLYMPIC
PIN
Micro TAC Lite II Entry PAK 76094WNHB 1 YR WARRANTY
SLIM NiCd BATTERY
SLOW DESK TOP CHARGER
Micro TAC Lite II Olympic Package 76482WNHS 1 YR WARRANTY
NEW, LIGHTWEIGHT NiMH
BATTERY FAST CHARGER
BASE & TRANSFORMER
VINYL CASE
COMMEMORATIVE OLYMPIC
PIN
Micro TAC Lite II Pro PAK 76097WNHP 3 YR WARRANTY
With Vibracall SLIM NiMH BATTERY
RAPID DESK TOP CHARGER
Micro TAC Elite NiMH Entry PAK 76730WNXS 1 YR WARRANTY
With Answering Machine SLIM NIMH BATTERY
AC CHARGER
ANSWERING MACHINE
Micro TAC Elite NiMH Olympic 76489WNXS 1 YR WARRANTY
Package With Answering SLIM NIMH BATTERY
Machine ELITE INTERNAL CHARGER
ANSWERING MACHINE
USER VIDEO
LEATHER CASE
COMMEMORATIVE OLYMPIC PIN
</TABLE>
All units include 2% cooperative promotion Allowance; application of which must
be according to the standard Motorola Cooperative Promotion Allowance Program as
revised January 1994.
- --------------
Brackets ([/]) indicate confidential portions omitted and filed separately with
the Commission.
<PAGE>
Confidential Business Information - Do Not copy or reproduce
AMENDMENT TO THE LETTER OF AGREEMENT
BETWEEN MOTOROLA AND CELLSTAR
ATTACHMENT A - PRICING
WIRELINE NAMPS PRODUCT DISTRIBUTION
-----------------------------------
Effective July 18, 1996
<TABLE>
<CAPTION>
PORTFOLIO PRODUCTS Model [REDACTED]
- ------------------ -----
<S> <C>
2900 Mobile 19052WNMS
2900 Attache w/o Battery 19067WNAB
2900 Attache with Battery 19066WNAS
2900 Lunchbox w/o Battery 19087WNLB
2900 Lunchbox with Battery 19086WNLS
Power PAK w/o Battery 19135WNJS
Power PAK with Battery 19147WNJD
Classic II 89011WNCB
Ultra Classic II Base Model 89013WNUB
DPC 550 34015WNRS
DPC 550 Travel Pak 34008WNRE
Micro TAC Ultra Lite Base Model 76289WNTB
</TABLE>
These rebates are accrued at shipment and are payable as account credits
following the payment of the Motorola shipment invoice, and provided your
Motorola receivables account is current.
- ----------------
Brackets ([/]) indicate confidential portions omitted and filed separately with
the Commission.
<PAGE>
Confidential Business Information - Do Not copy or reproduce
AMENDMENT TO THE LETTER OF AGREEMENT
BETWEEN MOTOROLA AND CELLSTAR
ATTACHMENT A - PRICING
WIRELINE NAMPS PRODUCT DISTRIBUTION
-----------------------------------
Effective July 18, 1996
<TABLE>
<CAPTION>
Products Model [REDACTED]
- -------- -----
<S> <C>
Contour 76546WNNB
Micro TAC DPC 650 76361WNDB
Micro TAC DPC 650 Olympic Package 76524WNDS
Micro TAC Lite II Entry PAK 76094WNHB
Micro TAC Lite II Olympic Package 76482WNHS
Micro TAC Lite II Pro PAK 76097WNHP
With Vibracall
Micro TAC Elite NiMH Entry PAK 76730WNXS
With Answering Machine
Micro TAC Elite NiMH Olympic Package 76489WNXS
With Answering Machine
</TABLE>
These rebates are accrued at shipment and are payable as account credits
following the payment of the Motorola shipment invoice, and provided your
Motorola receivables account is current.
- ----------------
Brackets ([/]) indicate confidential portions omitted and filed separately with
the Commission.
<PAGE>
CELLSTAR LTD.
ATTACHMENT B
TERMS AND CONDITIONS
1. Contract prices are based on a firm commitment by Buyer to take delivery of
the agreed quantity of Products during the Initial Term. Products may be
aggregated to reach the contract volume commitment. If Buyer takes delivery
of less than the committed quantity during the Initial Term, a volume
shortfall adjustment will be calculated and billed to Buyer based on unit
shipment shortfall from the committed quantity during the Initial Term. The
charge per unit short will be [REDACTED] for up to [REDACTED] units short,
[REDACTED] for more than [REDACTED] units and up to [REDACTED] units short,
and [REDACTED] for more than [REDACTED] units short of the committed
quantity. [REDACTED]
2. Motorola will issue rebates promptly after the month in which the Products
were delivered and after Product payment is received, in the form of a credit
memo that may be applied to the purchase of additional Products.
3. Motorola may sell other cellular subscriber equipment to Buyer if requested.
Any such sale during the term of this Agreement will be at Motorola's price,
and in accordance with the terms and conditions herein unless otherwise
specified by Motorola.
4. Buyer will exercise its best efforts to submit purchase orders no less than
thirty (30) days prior to the requested shipment dates and acknowledges that
shipment on the requested date is more likely as the lead time is increased.
If Motorola accepts a purchase order requesting shipment within thirty (30)
from the date Motorola receives the order, Buyer agrees that the ordered
Products will be shipped when it is practicable for Motorola to do so.
5. Payment terms are net 30 days.
6. Two percent (2%) of the invoice price of applicable Products purchased under
this Agreement will be accrued as a cooperative promotional allowance.
Application for funds must be made according to the Motorola Cellular Co-op
Advertising and Promotion Plan, US Version January 1994 or any subsequent
revision thereof that may be implemented by Motorola, which is incorporated
herein by reference.
7. All orders and shipments shall be in multiples of 5 units per model.
8. (a) Buyer shall be a non-exclusive distributor of the Products in those
geographical areas identified in Attachment E, and in any other market
attachment that may later be agreed upon by the parties as an amendment to
this Agreement (Buyer's "Territory").
Distributor Business Confidential Proprietary Rev. 6.4
Do Not Copy or Reproduce Page B-1
- --------------
Brackets ([/]) indicate confidential portions omitted and filed separately with
the Commission.
<PAGE>
CELLSTAR LTD.
ATTACHMENT B
TERMS AND CONDITIONS
(b) This Agreement may be amended by adding markets to Buyer's Territory.
Any such additional markets will be added by mutual agreement and will be
identified in separate attachments. It is the intention of the parties that
any market additions to this Agreement will have purchase volume
commitments, market development funds, and other similar incentives and
obligations, separate from and in addition to those incentives and
requirements associated with the markets identified in Attachment E.
(c) Any markets may be withdrawn from Buyer's Territory by Motorola on
ninety (90) days advance notice to Buyer. Buyer agrees that Motorola may
withdraw markets from Buyer's Territory at Motorola's discretion, with or
without cause, without any liability or obligation to Buyer or its
customers; provided, however, that Motorola will reimburse Buyer for a
reasonable cancellation fee paid to terminate a lease commitment(s)
reasonably occasioned by Buyer's obligation to sell Products in that market
by this Agreement.
(d) From time to time Motorola may request Buyer to service a certain market
not on the current Attachment E for a limited period of time. The terms of
any such arrangement shall be in writing and mutually agreeable to the
parties.
(e) Buyer's distribution of the Products is limited to Buyer's Territory.
Buyer shall not transship, sell, or otherwise transfer Products outside its
Territory, and Buyer shall incorporate this limitation into all of its agent
and distributor equipment agreements as a condition of resale of the
Products and reasonably enforce same. Sales within the Territory without
transshipment is a material condition to Buyer's rights under this
Agreement, and it is agreed that any direct or indirect distribution,
transshipment and/or sale of Products outside the Territory by Buyer or
others purchasing through Buyer shall be a material breach of this Agreement
and will result in substantial damage to Motorola which will be difficult to
quantify. Accordingly, in the event of such the parties agree that Motorola,
in addition to any other remedies it may have under applicable law and this
Agreement, may reject some or all purchase orders from Buyer for any model
or models of Product, including Premier products, until Buyer can
demonstrate that Buyer has instituted policies and procedures to prevent any
such occurrences in the future.
9. All units will carry mutually agreed upon designated logos. Buyer will
provide photographic quality artwork 30 days prior to requested ship date.
Buyer represents and warrants that it has the right by way of ownership or
otherwise, to use such logo and further agrees to indemnify and hold
Motorola harmless for any losses, damages or other liabilities resulting
from the use of the designated logo.
10. Buyer shall provide Motorola on a quarterly basis, not less than thirty (30)
days prior to the start of the next quarter, a continuous usage forecast for
the next two (2) calendar quarters (the "Quarterly Forecast") to assist
Motorola in maintaining an orderly production flow for the purpose of
Buyer's delivery requirements. Buyer shall indicate the Product model number
and projected purchase volume by units for each month of the quarter.
Distributor Business Confidential Proprietary Rev. 6.4
Do Not Copy or Reproduce Page B-2
<PAGE>
CELLSTAR LTD.
ATTACHMENT B
TERMS AND CONDITIONS
11. Buyer shall provide Motorola on a quarterly basis, not less than thirty (30)
days prior to the start of the next quarter, a firm processable purchase
order for the first month of the Quarterly Forecast; provided, however, that
a delivery(ies) scheduled in such first month may be rescheduled by Buyer
into the second month on notice to Motorola not less than [REDACTED] prior
to the scheduled delivery date.
12. (a) During the Initial Term of this Agreement, if Motorola reduces the price
of a particular model of Product, then Buyer shall be entitled to the
benefit of price protection for [REDACTED}
(b) Motorola will make a price adjustment for each Eligible Unit equal to
the difference between Buyer's net purchase price (invoice price less rebate
and any promotional amounts) and the new net price (invoice price less
rebate and any promotional amounts). Price protection will be paid as a
credit against future purchases within fifteen (15) days after the end of
the month of receipt of price protection claim and required documentation.
13. As a condition to the price protection described herein, Buyer shall furnish
Motorola with accurate monthly reports of Buyer inventory (by major product
category) of Products. Each such inventory report shall be received by your
Motorola Account Executive no later than the first Thursday following the
close of Motorola's shipment month (dates listed below), and shall include
all inventories maintained by Buyer and its affiliates, including
inventories maintained by major agents or at drop ship distribution points.
It is specifically understood that inventories maintained at Sam's Club
kiosk locations shall be estimates only. If any such report is received
after the applicable date listed below, the time period for shipments
protected against price reductions shall be reduced by one day for each day
such report is late.
Monthly reports of inventory are to be received by Motorola by:
Thursday 8/01/96
Thursday 8/29/96
Thursday 10/03/96
Thursday 10/31/96
Wednesday 11/27/96*
Thursday 1/02/97
* November inventory date is on Wednesday due to the Thanksgiving national
holiday.
Distributor Business Confidential Proprietary Rev. 6.4
Do Not Copy or Reproduce Page B-3
- --------------
Brackets ([/]) indicate confidential portions omitted and filed separately with
the Commission.
<PAGE>
CELLSTAR LTD.
ATTACHMENT B
TERMS AND CONDITIONS
14. [REDACTED]
15. Motorola will offer its Signature Products (including the StarTAC(TM)
cellular phone) to Buyer for distribution to Buyer's dealers and agents at
locations pre-approved by Motorola under the terms of Motorola's Signature
program in effect from time to time. Motorola will drop ship Buyer's orders
for Signature Products direct to each approved dealer and/or agent location,
with the related invoice being sent to the Buyer. Signature Products
delivered to a location may not be transshipped to any other location nor
offered for sale from any other location without Motorola's express prior
written consent.
Distributor Business Confidential Proprietary Rev. 6.4
Do Not Copy or Reproduce Page B-4
- --------------
Brackets ([/]) indicate confidential portions omitted and filed separately with
the Commission.
<PAGE>
CELLSTAR LTD.
ATTACHMENT C
SUPPLEMENTAL TERMS AND CONDITIONS
1. PRICES The prices for the Products purchased hereunder shall be as set forth
in Attachment A to the Agreement.
2. ORDERS AND FORECASTS (a) Orders. All orders by Buyer shall be only upon the
terms and conditions of this Agreement. The only effect of any terms and
conditions in Buyer's orders or elsewhere shall be to request the time and
place of delivery and number of units to be delivered, subject to Seller's
acceptance, but they shall not change, alter or add to the terms and
conditions of this Agreement in any other way. Seller's invoice shall also
not change the terms and conditions of this Agreement. (b) Forecasts. During
the term of this Agreement, Buyer shall use its best efforts to update, on a
quarterly basis, a continuous usage forecast to assist Seller in maintaining
an orderly production flow for the purpose of meeting Buyer's delivery
requirements. Buyer's failure to provide such information may be considered
cause by Seller for excusable delivery delay.
3. CANCELLATION Buyer may cancel orders placed in accordance with the terms and
conditions of this Agreement upon payment of cancellation charges which shall
include all costs incurred or committed for unless such costs are otherwise
recoverable through the sale of the product on a timely basis. Payment shall
be due within thirty (30) days of the date of invoice. Seller agrees to
divert completed material and work in process from canceled orders to other
requirements wherever possible in order to minimize cancellation charges.
4. DELIVERY AND PAYMENT (a.) All deliveries are FOB Motorola's plant. Each such
delivery will be separately invoiced and payment from Buyer shall be due
thirty (30) days from the date thereof without regard to other deliveries.
DELIVERY DATES ARE BEST ESTIMATES ONLY. (b.) Title to the Products sold shall
pass to Buyer at the FOB point.
5. FORCE MAJEURE Neither party shall be liable for any delay or failure to
perform due to any cause beyond its reasonable control except the obligation
to pay money when due. Causes include but are not limited to strikes, acts of
God, acts of the other party, interruptions of transportation or inability to
obtain necessary labor, materials or facilities, or default of any supplier,
or delays in FCC frequency authorization or license grant. The delivery
schedule shall be considered extended by a period of time equal to the time
lost because of any excusable delay. To the extent that MOTOROLA is unable to
manufacture and deliver the annual commitment, it shall be reduced on a pro-
rata basis. In the event MOTOROLA is unable to wholly or partially perform
for a period greater than forty-five (45) days because of any cause beyond
its reasonable control, either party may terminate any delayed order without
any liability.
6. WARRANTY MOTOROLA warrants the Products to the original subscriber buyers or
lessees only in accordance with its Limited Warranty attached to the
Agreement, or as the Limited Warranty may be revised by Motorola from time to
time (to be applicable to units shipped by Motorola on or after the effective
date of the revision), and makes no representation or warranty of any other
kind, express or implied. EXCEPT AS OTHERWISE PROVIDED IN THE LIMITED
WARRANTY, MOTOROLA SPECIFICALLY DISCLAIMS ANY IMPLIED WARRANTY OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.
7. PATENT AND COPYRIGHT INDEMNIFICATION (a) MOTOROLA agrees to defend, at its
expense, any suits against Buyer and third parties purchasing Motorola
products from Buyer based upon a claim that any products furnished hereunder
directly infringes a U.S. patent or copyright and to pay costs and damages
finally awarded in any such suit, provided that MOTOROLA is notified promptly
in writing of the suit and at Motorola's request and at its expense is given
control of said suit and all requested assistance for defense of same. If the
use or sale of any product(s) furnished hereunder is enjoined as a result of
such suit, MOTOROLA at its option and at no expense to Buyer, shall obtain
for Buyer the right to use or sell said product(s) or shall substitute an
equivalent product reasonably acceptable to Buyer and extend this indemnity
thereto or shall accept the return of the product(s) and reimburse Buyer the
purchase price therefor, less a reasonable charge for reasonable wear and
tear. This indemnity does not extend to any suit based upon any infringement
or alleged infringement of any patent or copyright by the alteration of any
products furnished by MOTOROLA or by the combination of any products(s)
furnished by MOTOROLA and other elements nor does it extend to any
products(s) of Buyer's design or formula. The foregoing states the entire
liability of MOTOROLA for patent or copyright infringement. (b) IN NO EVENT
SHALL MOTOROLA BE LIABLE FOR INCIDENTAL OR CONSEQUENTIAL DAMAGES ARISING FROM
INFRINGEMENT OR ALLEGED INFRINGEMENT OF PATENTS, COPYRIGHTS, OR OTHER
INTELLECTUAL PROPERTY RIGHTS.
Distributor Business Confidential Proprietary Rev. 6.4
Do Not Copy or Reproduce Page C-1
<PAGE>
CELLSTAR LTD.
ATTACHMENT C
SUPPLEMENTAL TERMS AND CONDITIONS
8. LICENSE DISCLAIMER Nothing contained herein shall be deemed to grant either
directly or by implication, estoppel, or otherwise, any license under any
patents, copyrights, trademarks or trade secrets of MOTOROLA.
9. TAXES Except for the amount, if any, of state and local tax stated in the
Agreement, the prices set forth herein are exclusive of any amount for
Federal, State and/or Local excise, sales, use, property, retailer's,
occupation or any other assessment in the nature of taxes however
designated, on the products and/or services provided under this Agreement.
If any such excluded tax, exclusive however, of any taxes measured by
Seller's net income or taxes based on Seller's gross receipts or based on
Seller's franchise, is determined to be applicable to this transaction or to
the extent MOTOROLA is required to pay or bear the burden thereof, one
hundred percent (100%) thereof shall be added to the prices set forth herein
and paid by Buyer. Personal property taxes assessable on the products shall
be the responsibility of Buyer. In the event Buyer claims exemption from
sales, use or other such taxes under this Agreement, Buyer shall hold
Motorola harmless of any subsequent assessments levied by a proper taxing
authority for such taxes, including interest, penalties, and late charges.
10. TECHNICAL ASSISTANCE Motorola's warranty shall not be enlarged, and no
obligation or liability shall arise out of Motorola's rendering of technical
advice, facilities or service in connection with Buyer's purchase of the
products furnished.
11. LIMITATION OF LIABILITY EXCEPT FOR PERSONAL INJURY, AND EXCEPT FOR PARAGRAPH
7 PATENT AND COPYRIGHT INDEMNIFICATION, MOTOROLA'S TOTAL LIABILITY, WHETHER
FOR BREACH OF CONTRACT, WARRANTY, NEGLIGENCE, STRICT LIABILITY IN TORT OR
OTHERWISE, IS LIMITED TO THE PRICE OF THE PARTICULAR PRODUCTS SOLD HEREUNDER
WITH RESPECT TO WHICH LOSSES OR DAMAGES ARE CLAIMED. BUYER'S SOLE REMEDY IS
TO REQUEST MOTOROLA AT MOTOROLA'S OPTION TO EITHER REFUND THE PURCHASE
PRICE, REPAIR OR REPLACE PRODUCT(S) THAT ARE NOT AS WARRANTED. IN NO EVENT
WILL MOTOROLA BE LIABLE FOR ANY LOSS OF USE, LOSS OF TIME, INCONVENIENCE,
COMMERCIAL LOSS, LOST PROFITS OR SAVINGS OR OTHER INCIDENTAL OR
CONSEQUENTIAL DAMAGES TO THE FULL EXTENT SUCH MAY BE DISCLAIMED BY LAW.
12. LOGOS AND TRADEMARKS In order that Seller may protect its trademarks, trade
names, corporate slogans, corporate logo, goodwill and product designations,
Buyer, without the express written consent of Seller, shall have no right to
use any such marks, names, slogans or designations of Seller in the sales,
lease or advertising of any products or on any product container, component
part, business forms, sales, advertising and promotional materials or other
business supplies or material, whether in writing, orally or otherwise.
13. PARTY RELATIONSHIP This Agreement does not create any agency, joint venture
or partnership between Buyer and Seller. Buyer shall not impose or create
any obligation or responsibility, express or implied, or make any promises,
representations or warranties on behalf of Seller, other than as expressly
provided herein.
14. WAIVER The failure of either party to insist in any one or more instances,
upon the performance of any of the terms or conditions herein or to exercise
any right hereunder shall not be construed as a waiver or relinquishment of
the future performance of any such terms or conditions or the future
exercise of such right but the obligation of the other party with respect to
such future performance shall continue in full force and effect.
15. DEFAULT In the event that either party shall be in breach or default of any
of the terms or conditions of this Agreement and such breach or default
shall continue for a period of thirty (30) days after the giving of written
notice to the breaching party, then subject to the other terms and
conditions of this Agreement, the other party, in addition to other rights
and remedies it may have in law or equity, shall have the right to
immediately cancel this Agreement without any charge or liability
whatsoever.
16. GOVERNMENT SALES In the event that Buyer elects to sell Motorola products or
services to the U.S. Government or a prime contractor selling to the U.S.
Government, Buyer remains solely and exclusively responsible for compliance
with all statutes and regulations governing sales to the U.S. Government.
Motorola makes no representations, certifications or warranties whatsoever
with respect to the ability of its goods, services or prices to satisfy any
such statutes or regulations. Failure of Buyer to conduct any sales to the
U.S. Government or to U.S. Government prime contractors in strict accordance
with U.S. law shall constitute a material breach of this Agreement.
Distributor Business Confidential Proprietary Rev. 6.4
Do Not Copy or Reproduce Page C-2
<PAGE>
CELLSTAR LTD.
ATTACHMENT C
SUPPLEMENTAL TERMS AND CONDITIONS
17. DISPUTE RESOLUTION. The parties agree that any claims or disputes will be
submitted to non-binding mediation prior to initiation of any formal legal
process. Costs of mediation will be shared equally.
18. EDI. In order to facilitate transactions under this Agreement, the parties
may electronically transmit and receive data in agreed formats in
substitution for conventional paper-based documents as provided in the
Electronic Data Interchange Trading Partner Agreement between the parties
dated as of April 20, 1993.
19. GENERAL No alterations or modifications of this Agreement shall be binding
upon either Buyer or Seller unless made in writing and signed by an
authorized representative of each. If any term or condition of this
Agreement shall to any extent be held by a court or other tribunal to be
invalid, void or unenforceable, then that term or condition shall be
inoperative and void insofar as it is in conflict with law, but the
remaining rights and obligations of the parties shall be construed and
enforced as if this Agreement did not contain the particular term or
condition held to be invalid, void or unenforceable. No assignment of this
Agreement or of any right granted herewith shall be made by Buyer without
the prior written consent of MOTOROLA. This Agreement shall be governed by
the laws of the State of Illinois.
Distributor Business Confidential Proprietary Rev. 6.4
Do Not Copy or Reproduce Page C-3
<PAGE>
MOTOROLA LIMITED WARRANTY FOR THE UNITED STATES
CELLULAR SUBSCRIBER RADIOTELEPHONE PRODUCTS
I. WHAT THIS WARRANTY COVERS AND FOR HOW LONG:
MOTOROLA INC. (MOTOROLA) warrants the MOTOROLA Cellular Subscriber
Radiotelephone products and accessories against defects in material and
workmanship under normal use and service for a period of time specified by the
product's serial number from the date of installation. (NOTE: Installation, in
the case of radiotelephones, accessories or batteries that are not installed in
a vehicle, means the date that the product is placed into subscriber service.
Installation will be deemed to be no later than thirty (30 days from date of
delivery of the Product to you the owner.) The warranty time period is specified
by the last digit of the mechanical serial number found on each cellular
product. Products sold under this warranty may have either a "P", "Y", "A", "B",
"C", or "D" or nothing in the eleventh position of the serial number. If there
is no letter or an "A", the product comes with a (1) one year warranty. Products
that have a "D" have a (2) two year warranty. Products that have a "Y" or a "B"
have a (3) three year warranty, and products that have a "P" or a "C" have a (5)
five year warranty commencing from the date of installation. The warranty time
period for radiotelephone accessories and batteries is as follows:
Transportable and Carry Phone batteries: 1 year
Portable or Digital Personal Communicator(TM) (DPC)
telephone batteries: 1 year
Carrying cases (excluding leather briefcases): Defect free at time
of shipment
Other radiotelephone accessories: 1 year
MOTOROLA, at its option, will at no charge either repair, replace, or refund the
purchase price of the Cellular Subscriber Radiotelephone Product during the
warranty period, provided it is returned in accordance with the terms of this
warranty to the MOTOROLA Cellular Service Center or distributor's service shop
qualified by MOTOROLA. Repair, at MOTOROLA's option, may include the replacement
of parts or boards with functionally equivalent reconditioned or new parts or
boards. Replaced parts, accessories, batteries, or boards are warranted for the
balance of the original time period. All replaced accessories, batteries, parts
and cellular telephone equipment shall become the property of MOTOROLA.
II. WARRANTY CONDITIONS:
This express limited warranty is extended by MOTOROLA to the original subscriber
buyer or lessee only and is not assignable or transferable to subsequent
subscriber buyers or lessees. This is the complete warranty for Cellular
Subscriber Radiotelephone Products by MOTOROLA. MOTOROLA assumes no obligation
or liability for additions or modifications to this warranty unless made in
writing and signed by an officer of MOTOROLA. Unless made in separate written
agreement between MOTOROLA and you, MOTOROLA does not warrant the installation,
maintenance or service of the equipment, accessories, batteries or parts.
Portable or DPC (Nickel Cadmium) batteries are warranted only if battery
capacity falls below 80% of rated capacity, or the battery develops leakage.
This warranty becomes void for all types of batteries if:
a. the batteries are charged by other than MOTOROLA approved battery
chargers specified for the charging of the battery.
b. any of the seals on the battery are broken or show evidence of
tampering.
c. the battery is used in equipment or service other than the cellular
telephone equipment for which it is specified.
MOTOROLA cannot be responsible in any way for any ancillary equipment not
furnished by MOTOROLA which is attached to or used in connection with MOTOROLA's
Cellular Subscriber Radiotelephone Products, or for operation of our equipment
with any ancillary equipment and all such equipment is expressly excluded from
this warranty. Furthermore, MOTOROLA cannot be responsible for any damage to
MOTOROLA equipment resulting from the use of ancillary equipment not furnished
by MOTOROLA for use with cellular subscriber equipment.
When the product is used in conjunction with ancillary or peripheral equipment
not manufactured by MOTOROLA, MOTOROLA does not warrant the operation of the
product/peripheral combination, and MOTOROLA will honor no warranty claim where
the product is used in such a combination and it is determined by MOTOROLA that
there is no fault with the MOTOROLA product. MOTOROLA specifically disclaims any
responsibility for any damage caused in any way by the use of portable
radiotelephone accessories and peripherals (specific examples include, but are
not limited to: batteries, chargers, adapters, and power supplies) when such
accessories and peripherals are not manufactured or supplied by MOTOROLA.
MOTOROLA disclaims liability for range, coverage, availability, or operation of
the Cellular System which is provided by the Carrier.
III. WHAT THIS WARRANTY DOES NOT COVER:
(a) Defects or damage resulting from use of the product in other than its normal
and customary manner. (b) Defects or damage from misuse, accident or neglect.
(c) Defects or damage from improper testing, operation, maintenance,
installation, adjustment, or any alteration or modification of any kind. (d)
Breakage or damage to antennas unless caused directly by defects in material or
workmanship. (e) Products disassembled or repaired in such a manner as to
adversely affect performance or prevent adequate inspection and testing to
verify any warranty claim. (f) Products which have had the serial number removed
or made illegible. (g) Defects or damage due to spills of food or liquid. (h)
Control Unit Coil Cords that are stretched or have the modular tab broken. (i)
All plastic surfaces and all other externally exposed parts that are scratched
or damaged due to customer normal use. (j) Leather briefcases (which are covered
under separate manufacturers' warranties). (k) Products rented on a
month-to-month basis. (l) The control unit keypad assembly, control unit
displays, and control unit coil cords are not covered after the first year from
installation.
IV. HOW TO GET WARRANTY SERVICE:
To receive warranty service, present your equipment to the facility described
below, along with your bill of sale or comparable substitute proof of sale or
lease bearing the date of installation, transceiver serial number, electronic
serial number, and installation facility if applicable.
Warranty service is available by returning MOTOROLA branded Radiotelephone
Products to a MOTOROLA Cellular Service Center authorized in writing by a
MOTOROLA Area Service Manager to perform warranty work on MOTOROLA Cellular
Subscriber Radiotelephone products. A Carrier or Distributor branded
Radiotelephone Product may be returned to either (a) the specific cellular
service shop qualified by MOTOROLA's Cellular Subscriber Services Department in
writing and operated by or affiliated with the cellular distributor which the
Distributor designates or (b) a MOTOROLA Authorized Cellular Service Center. In
most cases the service shop which installed your Cellular Radiotelephone and
accessories will provide warranty service. If you need additional information,
contact the shop that installed your Radiotelephone, the customer service
department of your cellular system operator, or MOTOROLA at the address at the
bottom of this page.
In the case of vehicular installation, the vehicle in which the Radiotelephone
Product is installed should be driven to the service shop, as analysis of any
problem may require inspection of the entire vehicular installation. In the case
of non-vehicular installation, the unit or accessories, together with any
detachable parts such as antennas, battery packs, and chargers, must be
delivered to a qualified MOTOROLA Cellular Service Center, or a MOTOROLA-
qualified service shop, transportation and insurance prepaid. When sent or
brought to the servicer, the Radiotelephone Product must be accompanied by your
name, address, and telephone number, name of cellular Carrier, and a description
of the problem.
V. GENERAL PROVISIONS:
This warranty sets forth our responsibilities regarding this product. Repair,
replacement or refund of the purchase price at MOTOROLA's option, is your
exclusive remedy. THIS WARRANTY IS GIVEN IN LIEU OF ALL OTHER EXPRESS
WARRANTIES. IMPLIED WARRANTIES, INCLUDING WITHOUT LIMITATION IMPLIED WARRANTIES
OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE, ARE LIMITED TO THE
DURATION OF THIS LIMITED WARRANTY. FURTHER, AS THE CELLULAR CARRIER IS NOT
CONTROLLED BY MOTOROLA, NO WARRANTY IS MADE AS TO COVERAGE, AVAILABILITY OR
GRADE OF SERVICE PROVIDED BY THE CELLULAR CARRIER. IN NO EVENT SHALL MOTOROLA BE
LIABLE FOR DAMAGES IN EXCESS OF THE PURCHASE PRICE OF THE CELLULAR
RADIOTELEPHONE PRODUCT, FOR ANY LOSS OF USE, LOSS OF TIME, INCONVENIENCE,
COMMERCIAL LOSS, LOST PROFITS OR SAVINGS OR OTHER INCIDENTAL, SPECIAL OR
CONSEQUENTIAL DAMAGES ARISING OUT OF THE USE OR INABILITY TO USE SUCH PRODUCT,
TO THE FULL EXTENT SUCH MAY BE DISCLAIMED BY LAW.
VI. PATENT AND SOFTWARE PROVISIONS:
MOTOROLA will defend at its own expense, any suit brought against you to the
extent that it is based on a claim that the Cellular Subscriber Radiotelephone
Product parts infringes a United States patent, and MOTOROLA will pay those
costs and damages finally awarded against you in any such suit which are
attributable to any such claim, but such defense and payments are conditioned on
the following: (i) that MOTOROLA will be notified promptly in writing by you of
any notice of such claim; and (ii) that MOTOROLA will have sole control of the
defense of such suit and all negotiations for its settlement or compromise; and
(iii) should the Cellular Radiotelephone, accessory, battery or parts become, or
in MOTOROLA's opinion be likely to become the subject of a claim of infringement
of a United States patent that you will permit MOTOROLA, at its option and
expense, either to procure for you the right to continue using the Cellular
Radiotelephone or parts or to replace or modify the same so that it becomes
non-infringing or to grant you a credit for such Cellular Radiotelephone or
parts as depreciated and accept its return. The depreciation will be an equal
amount per year over the lifetime of the Cellular Subscriber Radiotelephone,
accessories, battery or parts as established by MOTOROLA.
MOTOROLA will have no liability to you with respect to any claim of patent
infringement which is based upon the combination of the Cellular Radiotelephone
or parts furnished hereunder with software, apparatus or devices not furnished
by MOTOROLA, nor will MOTOROLA have any liability for the use of ancillary
equipment or software not furnished by MOTOROLA which is attached to or used in
connection with the Cellular Radiotelephone. The foregoing states the entire
liability of MOTOROLA with respect to infringement of patents by the Cellular
Radiotelephone, accessories, batteries or any parts thereof.
Laws in the United States and other countries preserve for MOTOROLA certain
exclusive rights for copyrighted MOTOROLA software such as the exclusive rights
to reproduce in copies and distribute copies of such MOTOROLA software.
MOTOROLA software may be copied into, used in and redistributed with only the
Cellular Subscriber Radiotelephone Product associated with such MOTOROLA
software. No other use, including without limitation disassembly, of such
MOTOROLA software or exercise of exclusive rights in such MOTOROLA software is
permitted.
VII. STATE LAW RIGHTS:
SOME STATES DO NOT ALLOW THE EXCLUSION OR LIMITATION OF INCIDENTAL OR
CONSEQUENTIAL DAMAGES, OR LIMITATIONS ON HOW LONG AN IMPLIED WARRANTY LASTS. SO
THE ABOVE LIMITATIONS OR EXCLUSIONS MAY NOT APPLY TO YOU.
This warranty gives you specific legal rights, and you may also have other
rights which vary from state to state.
MOTOROLA INC., Cellular Subscriber Services Department
1485 W. Shure Drive, Arlington Heights, IL 60004
<PAGE>
CELLSTAR LTD. AUTHORIZED MARKETS
ATTACHMENT E
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
- ------------------------------------------------------------------------------------------------------------------------------------
MARKET CODE STATE/CITIES CARRIER PRODUCT MARKET CODE STATE/CITIES CARRIER PRODUCT
- ------------------------------------------------------------------------------------------------------------------------------------
ALASKA MONTANA
- ------------------------------------------------------------------------------------------------------------------------------------
315 AK1 Wade Hampton PTI B 268 MSA Billings CommNET B
- ------------------------------------------------------------------------------------------------------------------------------------
316 AK3 Bethel PTI B 297 MSA Great Falls CommNET B
- ------------------------------------------------------------------------------------------------------------------------------------
ALABAMA 523 MT1 Lincoln CommNET B1
- ------------------------------------------------------------------------------------------------------------------------------------
41 MSA Birmingham GTE A 523 MT1 Lincoln CommNET B2
- ------------------------------------------------------------------------------------------------------------------------------------
83 MSA Mobile CONTEL A 524 MT2 Toole CommNET B
- ------------------------------------------------------------------------------------------------------------------------------------
222 MSA Tuscaloosa GTE A 525 MT3 Phillips CommNET B
- ------------------------------------------------------------------------------------------------------------------------------------
226 MSA Florence GTE A 526 MT4 Daniels CommNET B
- ------------------------------------------------------------------------------------------------------------------------------------
226 MSA Florence PriCellular B 527 MT5 Mineral CommNET B
- ------------------------------------------------------------------------------------------------------------------------------------
249 MSA Anniston GTE A 528 MT6 Deer Lodge CommNET B
- ------------------------------------------------------------------------------------------------------------------------------------
272 MSA Gadsden GTE A 529 MT7 Fergus CommNET B
- ------------------------------------------------------------------------------------------------------------------------------------
307 AL1 Franklin CONTEL B1 530 MT8 Beaverhead CommNET B
- ------------------------------------------------------------------------------------------------------------------------------------
307 AL1 Franklin Shoal Cellular B 531 MT9 Carbon CommNET B
- ------------------------------------------------------------------------------------------------------------------------------------
307 AL1 Franklin Algreg A 532 MT10 Prairie CommNET B
- ------------------------------------------------------------------------------------------------------------------------------------
308 AL2 Rainsville Farmers B2 NEW MEXICO
- ------------------------------------------------------------------------------------------------------------------------------------
309 AL3 Demopolis W. Alabama Cell A 285 MSA Las Cruces GTE B
- ------------------------------------------------------------------------------------------------------------------------------------
310 AL4 Atmore Frontier B 554 NM2 Colfax Plateau Cellular B
- ------------------------------------------------------------------------------------------------------------------------------------
310 AL4 Clanton Dominion Cell A 555 NM3 Caltron GTE B
- ------------------------------------------------------------------------------------------------------------------------------------
312 AL6 Washington Frontier B 556 NM4 Sante Fe Plateau Cellular B2
- ------------------------------------------------------------------------------------------------------------------------------------
312 AL6 Washington Pro Max Comm. A 557 NM5 Grant GTE B1
- ------------------------------------------------------------------------------------------------------------------------------------
313 AL7 Butler ATT RSA A 558 NM6 Lincoln GTE B3
- ------------------------------------------------------------------------------------------------------------------------------------
314 AL8 Lee Dana Comm A 558 NM6 Lincoln Plateau Cellular B2
- ------------------------------------------------------------------------------------------------------------------------------------
ARKANSAS NEW YORK
- ------------------------------------------------------------------------------------------------------------------------------------
165 MSA Fort Smith CONTEL A 25 MSA Buffalo SBMS A
- ------------------------------------------------------------------------------------------------------------------------------------
182 MSA Fayetville CONTEL A 34 MSA Rochester SBMS A
- ------------------------------------------------------------------------------------------------------------------------------------
324 AR1 Madison ALLTEL B 44 MSA Albany SBMS A
- ------------------------------------------------------------------------------------------------------------------------------------
324 AR1 Madison US CELLULAR A 53 MSA Syracuse SBMS A
- ------------------------------------------------------------------------------------------------------------------------------------
325 AR2 Marion Century B 115 MSA Udea SBMS A
- ------------------------------------------------------------------------------------------------------------------------------------
326 AR3 Sharp Century B 562 NY4 Ithaca SBMS A
- ------------------------------------------------------------------------------------------------------------------------------------
327 AR4 Clay East AR Cellular A NORTH DAKOTA
- ------------------------------------------------------------------------------------------------------------------------------------
328 AR5 Cross Meta Comm Cell A 298 MSA Bismarck CommNET B
- ------------------------------------------------------------------------------------------------------------------------------------
331 AR8 Franklin CONTEL B 580 ND1 Divide CommNET B
- ------------------------------------------------------------------------------------------------------------------------------------
332 AR9 Polk New Era Telecom A 581 ND2 Bottineau CommNET B
- ------------------------------------------------------------------------------------------------------------------------------------
334 AR11 Hempstead Century B 583 ND4 McKenzie CommNET B
- ------------------------------------------------------------------------------------------------------------------------------------
334 AR11 Hempstead Center Comm. A 584 ND5 Kidder CommNET B
- ------------------------------------------------------------------------------------------------------------------------------------
335 AR12 Ouachita Century B OKLAHOMA
- ------------------------------------------------------------------------------------------------------------------------------------
335 AR12 Ouachita Cellular Corp. A 45 MSA Oklahoma City SBMS B
- ------------------------------------------------------------------------------------------------------------------------------------
COLORADO 302 MSA Enid Dobson Cellular A
- ------------------------------------------------------------------------------------------------------------------------------------
241 MSA Pueblo CommNET B 302 MSA Enid Enid Cellular A
- ------------------------------------------------------------------------------------------------------------------------------------
348 CO1 Moffat CommNET A 596 OK1 Cimarron Panhandle Cell. B
- ------------------------------------------------------------------------------------------------------------------------------------
349 CO2 Logan CommNET B 597 OK2 Harper Dobson Cellular A
- ------------------------------------------------------------------------------------------------------------------------------------
351 CO4 Park CommNET B 597 OK2 Harper Pioneer Cellular B
- ------------------------------------------------------------------------------------------------------------------------------------
352 CO5 Elbert CommNET B 598 OK3 Grant Pioneer Cellular B2
- ------------------------------------------------------------------------------------------------------------------------------------
353 CO6 San Miguel CommNET B 598 OK3 Grant SBMS B1
- ------------------------------------------------------------------------------------------------------------------------------------
354 CO7 Saguache CommNET B 599 OK4 Nowata CONTEL B
- ------------------------------------------------------------------------------------------------------------------------------------
355 CO8 Kiowa CommNET B 600 OK5 Roger Mills Dobson Cellular B1
- ------------------------------------------------------------------------------------------------------------------------------------
356 CO9 Costilla CommNET B 600 OK5 Roger Mills Pioneer Cellular B2
- ------------------------------------------------------------------------------------------------------------------------------------
GEORGIA 601 OK6 Seminole Pioneer Cellular B
- ------------------------------------------------------------------------------------------------------------------------------------
372 GA2 Dawson Horizon B2 602 OK7 Beckham Triad Cellular A
- ------------------------------------------------------------------------------------------------------------------------------------
374 GA4 Jasper Wilkes Cell. B2 602 OK7 Beckham Dobson Cellular B1
- ------------------------------------------------------------------------------------------------------------------------------------
376 GA6 Spalding Horizon A 603 OK8 Jackson Texahoma LP B
- ------------------------------------------------------------------------------------------------------------------------------------
381 GA11 Toombe Cone Cellular B 604 OK9 Garvin SBMS B
- ------------------------------------------------------------------------------------------------------------------------------------
383 GA13 Early Cellular One A
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
Business Confidential Proprietary
<PAGE>
CELLSTAR LTD. AUTHORIZED MARKETS
ATTACHMENT E
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
MARKET CODE STATE/CITIES CARRIER PRODUCT MARKET CODE STATE/CITIES CARRIER PRODUCT
- ------------------------------------------------------------------------------------------------------------------------------------
IDAHO SOUTH DAKOTA
- ------------------------------------------------------------------------------------------------------------------------------------
392 ID5 Bune CommNET B1 289 MSA Rapid City CommNET B
- ------------------------------------------------------------------------------------------------------------------------------------
393 ID6 Clark CommNET B 267 MSA Sioux Falls CommNET B
- ------------------------------------------------------------------------------------------------------------------------------------
IOWA 634 SD1 Harding CommNET B
- ------------------------------------------------------------------------------------------------------------------------------------
253 MSA Sioux City CommNET B 635 SD2 Carson CommNET B
- ------------------------------------------------------------------------------------------------------------------------------------
417 IA6 Iowa CommNET B 636 SD3 McPherson CommNET B
- ------------------------------------------------------------------------------------------------------------------------------------
419 IA8 Monona CommNET B 637 SD4 Marshall PTI B
- ------------------------------------------------------------------------------------------------------------------------------------
420 IA9 Ida CommNET B 638 SD5 Custer CommNET B1
- ------------------------------------------------------------------------------------------------------------------------------------
420 IA14 Korruth CommNET B 638 SD5 Custer CommNET B2
- ------------------------------------------------------------------------------------------------------------------------------------
426 IA15 Dicksun CommNET B 639 SD6 Harkon CommNET B1
- ------------------------------------------------------------------------------------------------------------------------------------
427 IA16 Lyon CommNET B 639 SD6 Harkon CommNET B2
- ------------------------------------------------------------------------------------------------------------------------------------
KANSAS 640 SD7 Sully CommNET B
- ------------------------------------------------------------------------------------------------------------------------------------
89 MSA Wichita SBMS B 641 SD8 Kingsburg CommNET B
- ------------------------------------------------------------------------------------------------------------------------------------
179 MSA Topeka SBMS B 642 SD9 Hanson CommNET B
- ------------------------------------------------------------------------------------------------------------------------------------
301 MSA Lawrence SBMS B TENNESSEE
- ------------------------------------------------------------------------------------------------------------------------------------
428 KS1 Cheyenne Mercury Cellular A 36 MSA Memphis GTE A
- ------------------------------------------------------------------------------------------------------------------------------------
428 KS1 Cheyenne Kansas Cellular B 46 MSA Nashville GTE A
- ------------------------------------------------------------------------------------------------------------------------------------
429 KS2 Norton Mercury Cellular A 79 MSA Knoxville GTE A
- ------------------------------------------------------------------------------------------------------------------------------------
429 KS2 Norton Kansas Cellular B 85 MSA Tri-Cities GTE A
- ------------------------------------------------------------------------------------------------------------------------------------
430 KS3 Jewell Kansas Cellular B 88 MSA Chattanooga GTE A
- ------------------------------------------------------------------------------------------------------------------------------------
431 KS4 Marshall Kansas Cellular B 209 MSA Clarksville GTE A
- ------------------------------------------------------------------------------------------------------------------------------------
432 KS5 Brown Kansas Cellular B1 643 TN1 Lake GTE A
- ------------------------------------------------------------------------------------------------------------------------------------
432 KS5 Brown SBMS B2 645 TN3 Macon GTE A
- ------------------------------------------------------------------------------------------------------------------------------------
433 KS6 Wallace Mercury Cellular A 647 TN5 Fayette GTE A
- ------------------------------------------------------------------------------------------------------------------------------------
433 KS6 Wallace Kansas Cellular B 649 TN7 Bledsoe GTE A
- ------------------------------------------------------------------------------------------------------------------------------------
434 KS7 Trego Mercury Cellular A 649 TN7 Bledsoe Bledsoe Telephone B2
- ------------------------------------------------------------------------------------------------------------------------------------
434 KS7 Trego Kansas Cellular B TEXAS
- ------------------------------------------------------------------------------------------------------------------------------------
435 KS8 Ellsworth Kansas Cellular B 9 MSA Dallas/Ft. Worth SBMS B
- ------------------------------------------------------------------------------------------------------------------------------------
436 KS9 Morris Kansas Cellular B 10 MSA Houston GTE B
- ------------------------------------------------------------------------------------------------------------------------------------
437 KS10 Franklin Kansas Cellular B 33 MSA San Antonio SBMS B
- ------------------------------------------------------------------------------------------------------------------------------------
438 KS11 Hamilton Mercury Cellular A 75 MSA Austin GTE B
- ------------------------------------------------------------------------------------------------------------------------------------
438 KS11 Hamilton Kansas Cellular B 81 MSA El Paso GTE B
- ------------------------------------------------------------------------------------------------------------------------------------
439 KS12 Hodgeman Kansas Cellular B 101 MSA Beaumont GTE B
- ------------------------------------------------------------------------------------------------------------------------------------
439 KS12 Hodgeman Mercury Cellular A 112 MSA Corpus Christi SBMS B
- ------------------------------------------------------------------------------------------------------------------------------------
440 KS13 Edwards Kansas Cellular B 128 MSA McAllen Century A
- ------------------------------------------------------------------------------------------------------------------------------------
441 KS14 Reno Kansas Cellular B 128 MSA McAllen/Harlingen SBMS B
- ------------------------------------------------------------------------------------------------------------------------------------
442 KS15 Elk Kansas Cellular A 161 MSA Lubbock SBMS B
- ------------------------------------------------------------------------------------------------------------------------------------
KENTUCKY 162 MSA Brownsville Century A
- ------------------------------------------------------------------------------------------------------------------------------------
37 MSA Louisville GTE A 162 MSA Brownsville SBMS B
- ------------------------------------------------------------------------------------------------------------------------------------
116 MSA Lexington GTE A 170 MSA Galveston GTE B
- ------------------------------------------------------------------------------------------------------------------------------------
293 MSA Owensboro GTE B 188 MSA Amarillo Cell One A
- ------------------------------------------------------------------------------------------------------------------------------------
443 KY1 Fulton CONTEL B 188 MSA Amarillo SBMS B
- ------------------------------------------------------------------------------------------------------------------------------------
444 KY2 Union CONTEL B 220 MSA Abilene SBMS B
- ------------------------------------------------------------------------------------------------------------------------------------
445 KY3 Meade Bluegrass B 240 MSA Texarkana Century B
- ------------------------------------------------------------------------------------------------------------------------------------
446 KY4 Spencer Bluegrass B 255 MSA Odessa SBMS B
- ------------------------------------------------------------------------------------------------------------------------------------
446 KY4 Spencer Horizon Cellular A 287 MSA Bryan GTE B
- ------------------------------------------------------------------------------------------------------------------------------------
447 KY5 Barren Horizon Cellular A 292 MSA Sherman/Denison SBMS B
- ------------------------------------------------------------------------------------------------------------------------------------
447 KY5 Barren Bluegrass B 295 MSA Midland SBMS B
- ------------------------------------------------------------------------------------------------------------------------------------
448 KY6 Madison Horizon Cellular A 300 MSA Victoria GTE B
- ------------------------------------------------------------------------------------------------------------------------------------
448 KY6 Madison Cell. Phone of KY B 652 TX1 Dallas Triad Cellular A
- ------------------------------------------------------------------------------------------------------------------------------------
449 KY7 Trimble GTE A 652 TX1 Dallas XIT Cellular B
- ------------------------------------------------------------------------------------------------------------------------------------
450 KY8 Mason Horizon Cellular A 653 TX2 Hansford Triad Cellular A
- ------------------------------------------------------------------------------------------------------------------------------------
451 KY9 Elliott Appalachian Cell. B 653 TX2 Hansford Dobson Cellular B
- ------------------------------------------------------------------------------------------------------------------------------------
452 KY10 Powell Kentucky Cell. B 654 TX3 Parmer Plateau Cellular B
- ------------------------------------------------------------------------------------------------------------------------------------
453 KY11 Clay First Kentucky Cell. A 655 TX4 Brisloe Triad Cellular A
- ------------------------------------------------------------------------------------------------------------------------------------
453 KY11 Clay Litchfield County Cell. B 656 TX5 Hardeman Triad Cellular A
- ------------------------------------------------------------------------------------------------------------------------------------
656 TX5 Hardeman Brazos Cellular B2
- ------------------------------------------------------------------------------------------------------------------------------------
657 TX6 Jack SBMS B
- ------------------------------------------------------------------------------------------------------------------------------------
658 TX7 Fannin Century B6
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
CELLSTAR LTD. AUTHORIZED MARKETS
ATTACHMENT E
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
MARKET CODE STATE/CITIES CARRIER PRODUCT MARKET CODE STATE/CITIES CARRIER PRODUCT
- ------------------------------------------------------------------------------------------------------------------------------------
LOUISIANA TEXAS Cont.
- ------------------------------------------------------------------------------------------------------------------------------------
100 MSA Shreveport Century B 658 TX7 Fannin Lamar Cellular B5
- ------------------------------------------------------------------------------------------------------------------------------------
184 MSA Houma Mobile Tel B 658 TX7 Fannin Peoples Cellular B3
- ------------------------------------------------------------------------------------------------------------------------------------
197 MSA Lake Charles Mercury Cellular B 658 TX7 Fannin SBMS B1
- ------------------------------------------------------------------------------------------------------------------------------------
205 MSA Alexandria Century B 659 TX8 Gaines Poka Lambro B1
- ------------------------------------------------------------------------------------------------------------------------------------
219 MSA Monroe Century B 660 TX9 Runnels Lone Star Cellular A
- ------------------------------------------------------------------------------------------------------------------------------------
454 LA1 Claiborne Century B 660 TX9 Runnels Peoples Cellular B
- ------------------------------------------------------------------------------------------------------------------------------------
455 LA2 Morehouse Century B 660 TX9 Runnels SBMS B1
- ------------------------------------------------------------------------------------------------------------------------------------
456 LA3 DeSoto Century B2 660 TX9 Runnels SBMS B4
- ------------------------------------------------------------------------------------------------------------------------------------
456 LA3 DeSoto Mercury Cellular B1 661 TX10 Navarro GTE B3
- ------------------------------------------------------------------------------------------------------------------------------------
457 LA4 Caldwell Century B 661 TX10 Navarro SBMS B1
- ------------------------------------------------------------------------------------------------------------------------------------
458 LA5 Beauregard Centennial A 662 TX11 Cherokee GTE B
- ------------------------------------------------------------------------------------------------------------------------------------
458 LA5 Beauregard Mercury Cellular B1 663 TX12 Hudspeth ENMR B
- ------------------------------------------------------------------------------------------------------------------------------------
458 LA5 Kaplan Pace Communications B3 664 TX13 Reeves ENMR B
- ------------------------------------------------------------------------------------------------------------------------------------
459 LA6 Iberville Iberia Cellular A 665 TX14 Loving ENMR B
- ------------------------------------------------------------------------------------------------------------------------------------
461 LA8 St. James Mobile Tel B 666 TX15 Concho Five Star Cellular B2
- ------------------------------------------------------------------------------------------------------------------------------------
462 LA9 Plaquemines Mobile Tel B 667 TX16 Burleson GTE B
- ------------------------------------------------------------------------------------------------------------------------------------
MARYLAND 668 TX17 Newton GTE B
- ------------------------------------------------------------------------------------------------------------------------------------
257 MSA Hagerstown Horizon Cellular B 669 TX18 Edwards SBMS B
- ------------------------------------------------------------------------------------------------------------------------------------
469 MD3 Frederick Horizon Cellular A 670 TX19 Atascosa SBMS B
- ------------------------------------------------------------------------------------------------------------------------------------
MASS. 671 TX20 Wilson La Ward Cellular B2
- ------------------------------------------------------------------------------------------------------------------------------------
6 MSA Boston SBMS A 671 TX20 Wilson SBMS B1
- ------------------------------------------------------------------------------------------------------------------------------------
55 MSA Worchester SBMS A 672 TX21 Chambers GTE B
- ------------------------------------------------------------------------------------------------------------------------------------
471 MA2 Barnstable SBMS A UTAH
- ------------------------------------------------------------------------------------------------------------------------------------
MICHIGAN 675 UT3 Juab CommNET B
- ------------------------------------------------------------------------------------------------------------------------------------
64 MSA Grand Rapids Century B 676 UT4 Beaver CommNET B
- ------------------------------------------------------------------------------------------------------------------------------------
78 MSA Lansing Century B 677 UT5 Carbon CommNET B3
- ------------------------------------------------------------------------------------------------------------------------------------
94 MSA Saginaw Century B 678 UT6 Piute CommNET B
- ------------------------------------------------------------------------------------------------------------------------------------
132 MSA Kalamazoo Century B VIRGINIA
- ------------------------------------------------------------------------------------------------------------------------------------
177 MSA Battle Creek Century B 43 MSA Norfolk GTE B
- ------------------------------------------------------------------------------------------------------------------------------------
181 MSA Muskegon Century B 59 MSA Richmond GTE B
- ------------------------------------------------------------------------------------------------------------------------------------
193 MSA Benton Harbor Century B 104 MSA Newport News GTE B
- ------------------------------------------------------------------------------------------------------------------------------------
207 MSA Jackson Century B 157 MSA Roanoke GTE B
- ------------------------------------------------------------------------------------------------------------------------------------
472 MI1 Gogebie PTI B 235 MSA Petersburg GTE B
- ------------------------------------------------------------------------------------------------------------------------------------
473 MI2 Alger PTI B 262 MSA Danville GTE A
- ------------------------------------------------------------------------------------------------------------------------------------
474 MI3 Emmet Century B 683 VA3 Giles Blue Ridge Cell. A
- ------------------------------------------------------------------------------------------------------------------------------------
476 MI5 Manistee Century B 683 VA3 Giles GTE B
- ------------------------------------------------------------------------------------------------------------------------------------
477 MI6 Roscommon Century B 684 VA4 Bedford GTE B1
- ------------------------------------------------------------------------------------------------------------------------------------
478 MI7 Newaygo Century B 685 VA5 Bath GTE B
- ------------------------------------------------------------------------------------------------------------------------------------
479 MI8 Allegan Century B 686 VA6 Highland Virginia Cellular A
- ------------------------------------------------------------------------------------------------------------------------------------
480 MI9 Cass Century B 686 VA6 Highland CFW Cellular B
- ------------------------------------------------------------------------------------------------------------------------------------
687 VA7 Buckingham GTE B
- ------------------------------------------------------------------------------------------------------------------------------------
688 VA8 Amelia GTE B
- ------------------------------------------------------------------------------------------------------------------------------------
689 VA9 Greensville GTE B
- ------------------------------------------------------------------------------------------------------------------------------------
690 VA10 Frederick Shenandoah Cell. B
- ------------------------------------------------------------------------------------------------------------------------------------
691 VA11 Madison GTE B
- ------------------------------------------------------------------------------------------------------------------------------------
692 VA12 Caroline GTE B
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
CELLSTAR LTD. AUTHORIZED MARKETS
ATTACHMENT E
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
MARKET CODE STATE/CITIES CARRIER PRODUCT MARKET CODE STATE/CITIES CARRIER PRODUCT
- ------------------------------------------------------------------------------------------------------------------------------------
MINNESOTA WEST VIRGINIA
- ------------------------------------------------------------------------------------------------------------------------------------
198 MSA St. Cloud Cell. Mobile Systems B 703 WV3 Monongalia Horizon A
- ------------------------------------------------------------------------------------------------------------------------------------
482 MN1 Kittson Rural Cellular B 707 WV7 Raliegh Highland A
- ------------------------------------------------------------------------------------------------------------------------------------
483 MN2 Lake of the Woods Rural Cellular B WISCONSIN
- ------------------------------------------------------------------------------------------------------------------------------------
484 MN3 Koochiching Rural Cellular B 125 MSA Appleton PTI B
- ------------------------------------------------------------------------------------------------------------------------------------
486 MN5 Wilkin Rural Cellular B 232 MSA Eau Claire PTI B
- ------------------------------------------------------------------------------------------------------------------------------------
487 MN6 Hubbard Century A 290 MSA La Crosee Century B
- ------------------------------------------------------------------------------------------------------------------------------------
487 MN6 Hubbard Rural Cellular B 708 WI1 Burnett PTI B
- ------------------------------------------------------------------------------------------------------------------------------------
488 MN7 Chippewa Triad Cellular A 709 WI2 Bayfield PTI B
- ------------------------------------------------------------------------------------------------------------------------------------
489 MN8 Lacqui Parle Triad Cellular A 713 WI6 Trempeleau PTI B
- ------------------------------------------------------------------------------------------------------------------------------------
490 MN9 Pipestone Triad Cellular A 714 WI7 Wood PTI B
- ------------------------------------------------------------------------------------------------------------------------------------
491 MN10 LeSueur Frontier A 716 WI9 Columbia PTI B3
- ------------------------------------------------------------------------------------------------------------------------------------
492 MN11 Goodhue PTI A WYOMING
- ------------------------------------------------------------------------------------------------------------------------------------
MISSISSIPPI 718 WY1 Park CommNET B
- ------------------------------------------------------------------------------------------------------------------------------------
106 MSA Jackson Century A 719 WY2 Sheridan CommNET B
- ------------------------------------------------------------------------------------------------------------------------------------
173 MSA Biloxi/Gulfport Century A 710 WY3 Lincoln CommNET A
- ------------------------------------------------------------------------------------------------------------------------------------
173 MSA Biloxi/Gulfport Cell South B
- ------------------------------------------------------------------------------------------------------------------------------------
252 MSA Pascagoula Cell South A
- ------------------------------------------------------------------------------------------------------------------------------------
252 MSA Pascagoula Century A
- ------------------------------------------------------------------------------------------------------------------------------------
493 MS1 Tunica Mercury Cellular A
- ------------------------------------------------------------------------------------------------------------------------------------
493 MS1 Tunica Cell South B2
- ------------------------------------------------------------------------------------------------------------------------------------
494 MS2 Benton R&D Cell. A
- ------------------------------------------------------------------------------------------------------------------------------------
495 MS3 Bolivar Cell South B1
- ------------------------------------------------------------------------------------------------------------------------------------
496 MS4 Yalobusba Mercury Cellular A
- ------------------------------------------------------------------------------------------------------------------------------------
496 MS4 Yalobusba Cell South B
- ------------------------------------------------------------------------------------------------------------------------------------
497 MS5 Washington Bay Cellular A
- ------------------------------------------------------------------------------------------------------------------------------------
497 MS5 Washington Cell South B1
- ------------------------------------------------------------------------------------------------------------------------------------
498 MS6 Montgomery Mercury Cellular A
- ------------------------------------------------------------------------------------------------------------------------------------
498 MS6 Montgomery Cell South B2
- ------------------------------------------------------------------------------------------------------------------------------------
499 MS7 Leak County Cone Enterprises A
- ------------------------------------------------------------------------------------------------------------------------------------
500 MS8 Clairborne Cell South B
- ------------------------------------------------------------------------------------------------------------------------------------
501 MS9 Copiah Cell South A
- ------------------------------------------------------------------------------------------------------------------------------------
502 MS10 Smith Cell South B1
- ------------------------------------------------------------------------------------------------------------------------------------
502 MS10 Smith Cellular XL A
- ------------------------------------------------------------------------------------------------------------------------------------
503 MS11 Lamar Cellular XL A
- ------------------------------------------------------------------------------------------------------------------------------------
503 MS11 Lamar Cell South B1
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
CELLSTAR LTD. AUTHORIZED MARKETS
ATTACHMENT E
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
MARKET CODE STATE/CITIES CARRIER PRODUCT MARKET CODE STATE/CITIES CARRIER PRODUCT
- ------------------------------------------------------------------------------------------------------------------------------------
MISSOURI
- ------------------------------------------------------------------------------------------------------------------------------------
11 MSA St. Louis SBMS B
- ------------------------------------------------------------------------------------------------------------------------------------
24 MSA Kansas City SBMS B
- ------------------------------------------------------------------------------------------------------------------------------------
275 MSA St. Joseph SBMS B
- ------------------------------------------------------------------------------------------------------------------------------------
278 MSA Columbia Columbia Cellular A
- ------------------------------------------------------------------------------------------------------------------------------------
505 MO2 Harrison Florida Cellular A
- ------------------------------------------------------------------------------------------------------------------------------------
506 MO3 Schuyler US Cellular A
- ------------------------------------------------------------------------------------------------------------------------------------
508 MO5 Limm Charlton Valley Cell. B
- ------------------------------------------------------------------------------------------------------------------------------------
509 MO6 Jefferson Cell TEL A
- ------------------------------------------------------------------------------------------------------------------------------------
510 MO7 Saline Mid Missouri Cell. B
- ------------------------------------------------------------------------------------------------------------------------------------
511 MO8 Callaway SBMS B
- ------------------------------------------------------------------------------------------------------------------------------------
512 MO9 Bates SBMS B1
- ------------------------------------------------------------------------------------------------------------------------------------
514 MO11 Moniteau SBMS B
- ------------------------------------------------------------------------------------------------------------------------------------
514 MO11 Moniteau Al Cell Comm. A
- ------------------------------------------------------------------------------------------------------------------------------------
515 MO12 Maries SBMS B
- ------------------------------------------------------------------------------------------------------------------------------------
516 MO13 Washington SBMS B
- ------------------------------------------------------------------------------------------------------------------------------------
521 MO18 Perry SBMS B
- ------------------------------------------------------------------------------------------------------------------------------------
522 MO19 Stoddard SBMS B
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
CELLSTAR LTD.
ATTACHMENT F
ACCESSORIES PROGRAM
The following terms apply to Buyer's purchase of Accessories:
1. The attached Exhibit A sets forth the Accessories and the
applicable prices. Notwithstanding any other provision of the Agreement, Seller
may modify Exhibit A in any way at any time, including deleting or substituting
Accessories, by delivering or mailing a copy of such modification(s) to Buyer,
to be effective on the date therein stated.
2. The following provisions of the Agreement apply to the Accessories as
if they were Products, subject to the noted modifications:
(a) The cover page, except: Accessories are not considered in
determining the number of cellular subscriber units purchased, and Attachment A
is not applicable to Accessories.
(b) Attachment B, Paragraphs 5, 6, 12 through 15.
(c) Attachment C, Paragraphs 2 through 5, 6 ( except that the Limited
Warranty for Accessories is attached to this Amendment as Exhibit B, which is
subject to revision as provided in Paragraph 6), 7 through 11, 12(b), and 13
through 19.
3. Except as listed in Paragraph 2 above, the provisions of the
Agreement do not apply to the Accessories.
4. The following provisions also apply to the Accessories:
(a) Buyer agrees to exercise reasonable commercial efforts to purchase a
minimum of [REDACTED] of Accessories (net of any returns) from Seller under the
Agreement during the period January 1, 1996 to December 31, 1996. Buyer has set
the following quarterly goals for such purchases:
Q1 [REDACTED]
Q2 [REDACTED]
Q3 [REDACTED]
Q4 [REDACTED]
(b) For each calendar quarter stated in paragraph 4(a), if Buyer has
purchased (including taking delivery) a minimum of [REDACTED] (net of any
returns) of Accessories during such quarter, then Seller will, within 60 days
after the end of such quarter, credit Buyer's account [REDACTED] of the amount
paid by Buyer for such Accessories purchased during such quarter.
(c) If, after the end of each calendar month, Buyer substantiates to
Seller (in a form reasonably satisfactory to Seller) that at least [REDACTED] of
the dollar volume of its sales of aftermarket accessories for Motorola cellular
phones during that month were sales of Accessories Buyer purchased from Seller
under the Agreement, then Seller will, within 30 days after such substantiation,
credit Buyer's account [REDACTED] of the total dollar volume of Accessories
purchased by Buyer from Seller (including taking delivery and net of
Distributor Business Confidential Proprietary Rev. 6.4
Do Not Copy or Reproduce Page F-1
- --------------
Brackets ([/]) indicate confidential portions omitted and filed separately with
the Commission.
<PAGE>
CELLSTAR LTD.
ATTACHMENT F
ACCESSORIES PROGRAM
returns) during that month. If after December 31, 1996 Buyer substantiates a
level of at least [REDACTED] instead of [REDACTED], then Seller will credit
Buyer's account an additional [REDACTED] of the total dollar volume purchased
from the Seller.
(d) Seller will provide Buyer the following stock balancing options on
Accessories:
(i) Any Accessories returned within 60 days will be accepted by
Seller, provided that (i) Seller is notified of the return
request within 60 days of the invoice date, (ii) Buyer submits
an offsetting order for Accessories of equal or greater value,
and (iii) such offsetting order is received by Seller within 20
days of Seller's return authorization.
Example: Accessory return value equals $100,000. New order to
be placed for $100,000.
(ii) Any Accessories returned within 90 days will be accepted by
Seller, provided that (i) Seller is notified of the return
request within 90 days of the invoice date, (ii) Buyer submits
an offsetting order for Accessories of twice the value or
greater, and (iii) such offsetting order is received by Seller
within 20 days of Seller's return authorization.
Example: Accessory return value equals $100,000. New order to
be placed for $200,000.
Exhibits included:
Exhibit A: Accessories and Prices
Exhibit B: Limited Warranty for Accessories
Distributor Business Confidential Proprietary Rev. 6.4
Do Not Copy or Reproduce Page F-2
- --------------
Brackets ([/]) indicate confidential portions omitted and filed separately with
the Commission.
<PAGE>
3-WATT/ATTACHE/CARRY PHONE ACCESSORIES
PLATINUM PRICE PAGES
MARCH 1996
3-WATT/ATTACHE/CARRY ACCESSORIES
BATTERY ACCESSORIES
<TABLE>
<CAPTION>
Retail
Part # Package # Description [REDACTED]
<S> <C> <C>
- --------------------------------------------------------------------------------
SLN2803 SERIES III BATTERY ACCY
- --------------------------------------------------------------------------------
SLN2903 99425 TOTE BATTERY ACCY
- --------------------------------------------------------------------------------
SLN2941 SERIES I BATTERY ACCY
- --------------------------------------------------------------------------------
SLN7263 SERIES II BATTERY ACCY
- --------------------------------------------------------------------------------
SLN3180 99428 SERIES IV BATTERY ACCY KIT
- --------------------------------------------------------------------------------
SLN3181 SERIES IV MOBILE INSTAL ACCY
- --------------------------------------------------------------------------------
<CAPTION>
DATA PRODUCTS
Retail
Part # Package # Description [REDACTED]
<S> <C> <C>
- --------------------------------------------------------------------------------
S1688 CELLULAR CONNECTION
- --------------------------------------------------------------------------------
S1801 DATA PASSAGE INTERFACE
- --------------------------------------------------------------------------------
S1936 CELLULAR CONNECTION
- --------------------------------------------------------------------------------
<CAPTION>
INSTALLATION KITS
Retail
Part # Package # Description [REDACTED]
<S> <C> <C>
- --------------------------------------------------------------------------------
S1720 DVSP SECOND VEHICLE KIT
- --------------------------------------------------------------------------------
S1722 DVSP SECOND VEHICLE KIT 15 PIN
- --------------------------------------------------------------------------------
S1776 DVSP/DVC INSTALLATION KIT
- --------------------------------------------------------------------------------
S1777 STANDARD FAST TRAX INSTALL KIT
- --------------------------------------------------------------------------------
S1778 DVSP SECOND VEHICLE KIT DELUXE
- --------------------------------------------------------------------------------
S1802 FAS TRAX INSTALL W/DVSP
- --------------------------------------------------------------------------------
S2620 SERIES III INSTALL KIT
- --------------------------------------------------------------------------------
SLN6096 SERIES IV SMALL MTNG BRKT
- --------------------------------------------------------------------------------
SLN8652 SERIES III MNTG BRACKET
- --------------------------------------------------------------------------------
<CAPTION>
MOBILE TO CARRY CONVERSION KITS
Retail
Part # Package # Description [REDACTED]
<S> <C> <C>
- --------------------------------------------------------------------------------
S1795 SERIES I MOB/CP CONVERT W/O BATT
- --------------------------------------------------------------------------------
S2585 SERIES III MOB/CP CONVT W/O BATT
- --------------------------------------------------------------------------------
S2586 SERIES II MOB/CP CONVT W/BATT
- --------------------------------------------------------------------------------
S3583 Soft-Pak Accy with Battery
- --------------------------------------------------------------------------------
S3584 Soft-Pak w/out Battery
- --------------------------------------------------------------------------------
SLN2940 SERIES II MOB/CP CONVT KIT W/BAT
- --------------------------------------------------------------------------------
SLN3174 Deluxe ATTACHE ACCY W/BATT & MIC
- --------------------------------------------------------------------------------
SLN3175 BASIC ATTACHE ACCY W/O BATT
- --------------------------------------------------------------------------------
- ---------------
Brackets [/] indicate confidential portions omitted and filed separately with
the Commission.
<CAPTION>
ANTENNAS
Retail
Part # Package # Description [REDACTED]
<S> <C> <C>
- --------------------------------------------------------------------------------
SAF2010 MAG MOUNT ANT CARRY PHONES
- --------------------------------------------------------------------------------
SAF4060 SERIES I & II CP ANTENNA
- --------------------------------------------------------------------------------
SAF4062 ROOFTOP ANTENNA 3DB
- --------------------------------------------------------------------------------
SAF4080 GLASS MOUNT ANTENNA 5DBV
- --------------------------------------------------------------------------------
SAF4320 SERIES III CP ANTENNA
- --------------------------------------------------------------------------------
SAF4490 TOTE ANTENNA
- --------------------------------------------------------------------------------
SAF4750 99400 MiniMag Antenna for Carry Phones
- --------------------------------------------------------------------------------
SAF4760 ATTACHE ANTENNA
- --------------------------------------------------------------------------------
SDF4000 ROOFTOP ANTENNA 5DB
- --------------------------------------------------------------------------------
SLN7767 WINDOW CLIP ANTENNA MOUNT
- --------------------------------------------------------------------------------
TAF6151 GLASS MOUNT ANTENNA
- --------------------------------------------------------------------------------
</TABLE>
Prepared by Motorola March 1996 Page 1
- ---------------
Brackets [/] indicate confidential portions omitted and filed separately with
the Commission.
<PAGE>
3-WATT/ATTACHE/CARRY PHONE ACCESSORIES
PLATINUM PRICE PAGES
MARCH 1996
<TABLE>
<CAPTION>
CABLES
Retail
Part # Package # Description [REDACTED]
- -----------------------------------------------------------------------------------------------------------
<S> <C>
SKN2028 5M 25 PIN DVSP CABLE
- -----------------------------------------------------------------------------------------------------------
SKN2029 2M 25 PIN PHONO DVSP CABLE
- -----------------------------------------------------------------------------------------------------------
SKN2030 5M 25 PIN VSP CABLE
- -----------------------------------------------------------------------------------------------------------
SKN4070 HANDSET EXTENSION CABLE
- -----------------------------------------------------------------------------------------------------------
SKN4164 2M CARRIER CABLE BOX
- -----------------------------------------------------------------------------------------------------------
SKN4165 2M CHARGER CABLE BOX
- -----------------------------------------------------------------------------------------------------------
SKN4235 HANDSET EXTENSION CABLE
- -----------------------------------------------------------------------------------------------------------
SKN4255 5M 15 PIN DVSP CABLE
- -----------------------------------------------------------------------------------------------------------
SKN4258 32-25 PIN TEST ADAPTOR CABLE
- -----------------------------------------------------------------------------------------------------------
SKN4276 5M 25PIN DVSP CABLE
- -----------------------------------------------------------------------------------------------------------
SKN4278 2M 25 PIN DVSP CABLE
- -----------------------------------------------------------------------------------------------------------
SKN4302 25 PIN POWER CABLE
- -----------------------------------------------------------------------------------------------------------
SKN4304 2M 15 PIN DVSP CABLE
- -----------------------------------------------------------------------------------------------------------
SKN4370 SERIES I & II FUSE KIT
- -----------------------------------------------------------------------------------------------------------
SKN4382 DVSP CABLE ADAPTOR
- -----------------------------------------------------------------------------------------------------------
SKN4396 PHONE PLUG
- -----------------------------------------------------------------------------------------------------------
SKN4400 SERIES II POWER ADAPTOR CBL
- -----------------------------------------------------------------------------------------------------------
SKN4466 SERIES III 5M POWER CABLE
- -----------------------------------------------------------------------------------------------------------
SKN4467 SERIES III 5M DATA CABLE
- -----------------------------------------------------------------------------------------------------------
SKN4468 SERIES III FUSE KIT
- -----------------------------------------------------------------------------------------------------------
SKN4490 SERIES III 2M POWER CABLE
- -----------------------------------------------------------------------------------------------------------
SKN4491 SERIES III 2M DATA CABLE
- -----------------------------------------------------------------------------------------------------------
SKN4506 TOTE WIRING HARNESS
- -----------------------------------------------------------------------------------------------------------
SKN4614 BATTERY ADPT CBL SERIES IV
- -----------------------------------------------------------------------------------------------------------
TKN8365 6M POWER CABLE BOX
- -----------------------------------------------------------------------------------------------------------
TKN8461 3M POWER CABLE EXTENSION BOX
- -----------------------------------------------------------------------------------------------------------
<CAPTION>
CONTROL UNITS
Retail
Part # Package # Description [REDACTED]
- -----------------------------------------------------------------------------------------------------------
<S> <C>
SLN3183AA SPARE HANDSET AMPS WL STD
- -----------------------------------------------------------------------------------------------------------
SLN3183AB SPARE HANDSET NAMPS WL STD
- -----------------------------------------------------------------------------------------------------------
SLN3183AF SPARE HANDSET KSX 6-BUTTON
- -----------------------------------------------------------------------------------------------------------
SLN3183AH SPARE HANDSET TX200X 6-BUTTON
- -----------------------------------------------------------------------------------------------------------
SLN3183AM SPARE HANDSET WL GRAY 6-BUTTON
- -----------------------------------------------------------------------------------------------------------
SLN3183AN SPARE HANDSET NAMPS WL DELUXE
- -----------------------------------------------------------------------------------------------------------
SLN3183AT SPARE HANDSET NAMPS NWL STANDARD
- -----------------------------------------------------------------------------------------------------------
SLN3183AX SPARE HANDSET WL STANDARD TDMA
- -----------------------------------------------------------------------------------------------------------
- ---------------
Brackets [/] indicate confidential portions omitted and filed separately with
the Commission.
<CAPTION>
CARRY CASES
Retail
Part # Package # Description [REDACTED]
- -----------------------------------------------------------------------------------------------------------
<S> <C>
SLN4691 TT CARRY CASE STRAP
- -----------------------------------------------------------------------------------------------------------
SLN4805 TOUGH TALKER CASE
- -----------------------------------------------------------------------------------------------------------
SLN6632 TRAVELER SOFT PAK BAG BLACK (VINYL)
- -----------------------------------------------------------------------------------------------------------
SLN6633 TRAVELER SOFT PAK BAG GRAY (VINYL)
- -----------------------------------------------------------------------------------------------------------
SLN7401 SHOULDER STRAP
- -----------------------------------------------------------------------------------------------------------
SLN8185 SERIES III CP BAG W/LOGO
- -----------------------------------------------------------------------------------------------------------
SLN8661 TOTE SHOULDER STRAP
- -----------------------------------------------------------------------------------------------------------
SLN8765 TOTE BAG GRAY
- -----------------------------------------------------------------------------------------------------------
SLN8766 TOTE BAG BEIGE
- -----------------------------------------------------------------------------------------------------------
</TABLE>
- ---------------
Brackets [/] indicate confidential portions omitted and filed separately with
the Commission.
<PAGE>
3-WATT/ATTACHE/CARRY PHONE ACCESSORIES
PLATINUM PRICE PAGES
MARCH 1996
<TABLE>
<CAPTION>
HANG-UP CUPS & MOUNTING HARDWARE
Retail
Part # Package # Description [REDACTED]
<S> <C> <C>
- --------------------------------------------------------------------------------
SLN2048 DVSP RETROFIT KIT
- --------------------------------------------------------------------------------
SLN4103 DMT U MOUNTING BKT
- --------------------------------------------------------------------------------
SLN4412 FAST TRAX SLIDE MOUNT
- --------------------------------------------------------------------------------
SLN4545 DMT WINGNUT MOUNT BRKT
- --------------------------------------------------------------------------------
SLN4645 FAST TRAX MOUNT W/CLAMSHELL
- --------------------------------------------------------------------------------
SLN4834 HANGUP CUP W/CLAMSHELL
- --------------------------------------------------------------------------------
SLN5216 5" FLEX MNTG POST
- --------------------------------------------------------------------------------
SLN6805 Series IV Attache/SoftPak Hangup Cup
- --------------------------------------------------------------------------------
SLN6483 CLAMSHELL/BRKT HANGUP CUP
- -------------------------------------------------------------------------------
SLN7890 TARGET INSERTS
- --------------------------------------------------------------------------------
SLN8484 SERIES III CP HANGUP CUP
- --------------------------------------------------------------------------------
SLN8660 TOTE HARDWARE KIT
- --------------------------------------------------------------------------------
SLN8840 HANGUP CUP W/LTCH & CLAM
- --------------------------------------------------------------------------------
SLN9556 HANG UP CUP (Traveler Mobile)
- --------------------------------------------------------------------------------
SLN9583 SERIES IV HANG UP CUP W/O CLAM
- --------------------------------------------------------------------------------
SLN9584 HANG UP CUP WITH CLAMSHELL
- --------------------------------------------------------------------------------
TRN5095 HANGUP CUP W/LATCH
- --------------------------------------------------------------------------------
TRN5502 CLAMSHELL MOUNT
- --------------------------------------------------------------------------------
TRN5777 3" MOUNTING POST
- --------------------------------------------------------------------------------
TRN9013 HANGUP CUP INSERT FOR PORTS
- --------------------------------------------------------------------------------
TRN9137 ES MOUNTING HARDWARE
- --------------------------------------------------------------------------------
<CAPTION>
BATTERIES
Retail
Part # Package # Description [REDACTED]
<S> <C> <C>
- --------------------------------------------------------------------------------
SNN2001 TOUGH TALKER BATTERY
- --------------------------------------------------------------------------------
SNN4139 CARRY PHONE BATTERY
- --------------------------------------------------------------------------------
SNN4298 TOTE PHONE BATTERY
- --------------------------------------------------------------------------------
<CAPTION>
CHARGERS
Retail
Part # Package # Description [REDACTED]
<S> <C> <C>
- --------------------------------------------------------------------------------
SLN4703 TOUGH TALKER TRICKLE CHARGER
- --------------------------------------------------------------------------------
SLN5721 POWER CHARGING CABLE CP
- --------------------------------------------------------------------------------
SPN4016 SERIES I & II CP FAST CHARGER
- --------------------------------------------------------------------------------
SPN4025 CP AC TRICKLE CHARGER
- --------------------------------------------------------------------------------
SPN4272 SERIES III CP FAST CHARGER
- --------------------------------------------------------------------------------
SPN4104 TOTE AC TRICKLE CHARGER
- --------------------------------------------------------------------------------
TKN8297 TOUGH TALKER CIG CABLE
- --------------------------------------------------------------------------------
- ---------------
Brackets [/] indicate confidential portions omitted and filed separately with
the Commission.
<CAPTION>
SPEAKERS
Retail
Part # Package # Description [REDACTED]
<S> <C> <C>
- --------------------------------------------------------------------------------
SSN2005 12PIN MOLEX VSP SPEAKER
- --------------------------------------------------------------------------------
SSN4002 PHONO DVSP SPEAKER
- --------------------------------------------------------------------------------
SSN4005 MOLEX DVSP SPEAKER
- --------------------------------------------------------------------------------
TLN2660 12 PIN MOLEX SPEAKER
- --------------------------------------------------------------------------------
TLN2661 12 PIN MOLEX VSP SPEAKER
- --------------------------------------------------------------------------------
<CAPTION>
MICROPHONES
Retail
Part # Package # Description [REDACTED]
<S> <C> <C>
- --------------------------------------------------------------------------------
TMN6162 VSP PHONO MIC
- --------------------------------------------------------------------------------
SMN4007 DVSP MIC & STAND
- --------------------------------------------------------------------------------
SMN4020 99301 DVSP MICROPHONE
- --------------------------------------------------------------------------------
SMN4031 DVSP MICROPHONE
- --------------------------------------------------------------------------------
SMN4071 TDMA VSP MICROPHONE
- --------------------------------------------------------------------------------
</TABLE>
Prepared by Motorola March 1996 Page 3
- ---------------
Brackets [/] indicate confidential portions omitted and filed separately with
the Commission.
<PAGE>
3-WATT/ATTACHE/CARRY PHONE ACCESSORIES
PLATINUM PRICE PAGES
MARCH 1996
<TABLE>
<CAPTION>
MISCELLANEOUS
Retail
Part # Package # Description [REDACTED]
<S> <C> <C>
- --------------------------------------------------------------------------------
SLN3182 External Spkr Driver Board
- --------------------------------------------------------------------------------
SLN3189 External Spkr Driver Board and Speaker
- --------------------------------------------------------------------------------
SLN5485 MINI UHF CRIMPING CONNECTOR
- --------------------------------------------------------------------------------
SLN5771 25 PIN IN LINE TEST CONNECTOR
- --------------------------------------------------------------------------------
SLN5784 MIC STAND & CLIP
- --------------------------------------------------------------------------------
SLN6609 SERIES IV Power Conn Assmbly w/o mic
- --------------------------------------------------------------------------------
SLN6610 SERIES IV Power Conn Assmbly w/mic
- --------------------------------------------------------------------------------
SLN7012 ID TRANSFER CABLE
- --------------------------------------------------------------------------------
SLN7286 SERIES II CP BRACKET ASSEMBLY
- --------------------------------------------------------------------------------
SLN7614 MINI UHF TO TNC CONNECTOR
- --------------------------------------------------------------------------------
SLN8189 SERIES III PWR ASMBLY W/BAT CON
- --------------------------------------------------------------------------------
SLN8190 SERIES III PWR ASMBLY W/O CONN
- --------------------------------------------------------------------------------
SLN8327 SERIES III RT ANGLE ELBOW
- --------------------------------------------------------------------------------
SLN8588 ANTENNA O RINGS (SERIES II CP)
- --------------------------------------------------------------------------------
</TABLE>
Prepared by Motorola March 1996 Page 4
- ---------------
Brackets [/] indicate confidential portions omitted and filed separately with
the Commission.
<PAGE>
ELITE, FLIP, POCKET PHONE ACCESSORY
PLATINUM PRICE PAGES
MARCH 1996
ELITE/FLIP/POCKET ACCESSORIES
<TABLE>
<CAPTION>
CHARGERS AND ADAPTERS
Part # Pkg # Description [REDACTED]
<S> <C> <C> <C>
- --------------------------------------------------------------------------------
S1753 99331 DPC OVERNIGHT CHARGER
- --------------------------------------------------------------------------------
S1754 99332 DPC RAPID CHARGER
- --------------------------------------------------------------------------------
SKN4380 DPC TBS Extension
- --------------------------------------------------------------------------------
SLN5039 REPLACEMENT BASE S1753
- --------------------------------------------------------------------------------
SLN9231 99333 DC Charger Teletac/Pocket Telephone
- --------------------------------------------------------------------------------
SLN9347 REPLACEMENT BASE S1754
- --------------------------------------------------------------------------------
SLN9700 99416 DPC Travel Charger
- --------------------------------------------------------------------------------
SLN9739 99401 ULTRA SAVER (DPC)
- --------------------------------------------------------------------------------
SLN9933 99457 ULTRA SAVER II (ELITE)
- --------------------------------------------------------------------------------
SPN2071 99456 Inellicharger EP Kit
- --------------------------------------------------------------------------------
SPN4027 REPLCMNT XFMR FOR SLOW CHGR
- --------------------------------------------------------------------------------
SPN4029 REPLCMNT XFRMR S1754
- --------------------------------------------------------------------------------
SPN4139 99491 AC Charger Teletac/Pocket Telephone
- --------------------------------------------------------------------------------
SPN4159 AC Pwr Supply for Elito/EP Charger
- --------------------------------------------------------------------------------
SPN4216 Inellicharger EP Base Only
- --------------------------------------------------------------------------------
SPN4218 99466 Compact Rapid Charger
- --------------------------------------------------------------------------------
<CAPTION>
CARRY CASES
Part # Pkg # Description [REDACTED]
<S> <C> <C> <C>
- --------------------------------------------------------------------------------
SLN5988 DPC VINYL CASE
- --------------------------------------------------------------------------------
SLN6047 99412 DPC 550/Alpha Open Face Carry Case
- --------------------------------------------------------------------------------
SLN6048 99413 DPC Lite/Ultra Open Face Carry Case
- --------------------------------------------------------------------------------
SYN4236 99473 Elite Open Face Case
- --------------------------------------------------------------------------------
SLN6651 Leather Micro Tac Elite Case
- --------------------------------------------------------------------------------
SLN6652 Vinyl Micro Tac Elite Case
- --------------------------------------------------------------------------------
SLN7613 DPC TRAVEL CASE
- --------------------------------------------------------------------------------
SLN8499 DPC VINYL CASE
- --------------------------------------------------------------------------------
SLN8500 DPC LEATHER CASE
- --------------------------------------------------------------------------------
SLN9961 Lanyard for Micro Tac Elite
- --------------------------------------------------------------------------------
SYN4634 Micro Tac/Elite Purse Pak - Brown
- --------------------------------------------------------------------------------
SYN4635 Micro Tac/Elite Purse Pak - Black
- --------------------------------------------------------------------------------
<CAPTION>
DATA ACCESSORIES
Part # Pkg # Description [REDACTED]
<S> <C> <C> <C>
- --------------------------------------------------------------------------------
S3027 CELLULAR CONN DPC*
- --------------------------------------------------------------------------------
S4229 Micro TAC Elite Cell Connection*
- --------------------------------------------------------------------------------
SKN4567 DATA CBLDPC CELL CONN
- --------------------------------------------------------------------------------
SKN4581 COMPAQ/DPC Cell Connection Cable
- --------------------------------------------------------------------------------
SKN4635 Micro Tac Elite Cell Connection Cable
- --------------------------------------------------------------------------------
SKN4681 PCMCIA Cable for Micro Tac Elite
- --------------------------------------------------------------------------------
SKN4682 Pocekt Modem Cable for Micro Tac Elite
- --------------------------------------------------------------------------------
SKN4685 Compaq Cable for Micro Tac Elite
- --------------------------------------------------------------------------------
SLN2503 DPC INTERFACE BOX
- --------------------------------------------------------------------------------
99426 PKGD PCMCIA Modem
- --------------------------------------------------------------------------------
99427 PKGD Pocket Moem
- --------------------------------------------------------------------------------
SLN9729 MicroTac Desktop Stand
- --------------------------------------------------------------------------------
</TABLE>
- ---------------
Brackets ([/]) indicate confidential portions omitted and filed separately with
the Commission.
Prepared by Motorola March, 1996 Page 1
<PAGE>
ELITE, FLIP, POCKET PHONE ACCESSORY
PLATNUM PRICE PAGES
MARCH 1996
<TABLE>
<CAPTION>
VEHICLE KITS
Part # Pkg # Description [REDACTED]
<S> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------------
S1757 DHFA POCKET FLIP w/ANTENNA - QUANTITIES OF 1 TO 99
- ----------------------------------------------------------------------------------------------------------
DHFA POCKET FLIP w/ANTENNA - QUANTITIES OF 100 TO 499
- ----------------------------------------------------------------------------------------------------------
DHFA POCKET FLIP w/ANTENNA - QUANTITIES OF 500 TO 999
- ----------------------------------------------------------------------------------------------------------
DHFA POCKET FLIP w/ANTENNA - QUANTITIES OF 1000 AND UP
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
S1757 T70BA DHFA POCKET FLIP without ANTENNA - QUANTITIES OF 1 TO 99
- ----------------------------------------------------------------------------------------------------------
DHFA POCKET FLIP without ANTENNA - QUANTITIES OF 100 TO 499
- ----------------------------------------------------------------------------------------------------------
DHFA POCKET FLIP without ANTENNA - QUANTITIES OF 500 TO 999
- ----------------------------------------------------------------------------------------------------------
DHFA POCKET FLIP without ANTENNA - QUANTITIES OF 1000 AND UP
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
S1758 DPC VEHICULAR CHGR/HOLDER
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
S4143 3 - WATT VA (AMPS) - QUANTITIES OF 1 TO 99
- ----------------------------------------------------------------------------------------------------------
3 - WATT VA (AMPS) - QUANTITIES OF 100 TO 499
- ----------------------------------------------------------------------------------------------------------
3 - WATT VA (AMPS) - QUANTITIES OF 500 TO 999
- ----------------------------------------------------------------------------------------------------------
3 - WATT VA (AMPS) - QUANTITIES OF 1000 AND UP
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
S4144 3- WATT VA (NAMPS) - QUANTITIES OF 1 TO 99
- ----------------------------------------------------------------------------------------------------------
3- WATT VA (NAMPS) - QUANTITIES OF 100 TO 499
- ----------------------------------------------------------------------------------------------------------
3- WATT VA (NAMPS) - QUANTITIES OF 500 TO 999
- ----------------------------------------------------------------------------------------------------------
3- WATT VA (NAMPS) - QUANTITIES OF 1000 AND UP
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
S4223 DHFA ELITE/ULTIMA w/ANTENNA - QUANTITIES OF 1 TO 99
- ----------------------------------------------------------------------------------------------------------
DHFA ELITE/ULTIMA w/ANTENNA - QUANTITIES OF 100 TO 499
- ----------------------------------------------------------------------------------------------------------
DHFA ELITE/ULTIMA w/ANTENNA - QUANTITIES OF 500 TO 999
- ----------------------------------------------------------------------------------------------------------
DHFA ELITE/ULTIMA w/ANTENNA - QUANTITIES OF 1000 AND UP
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
S4224 MicroTac Elite HF/3 Watt (2.9) VA Adptr
- ----------------------------------------------------------------------------------------------------------
S4225 MicroTac Elite 3 Watt (2.5) VA Adptr
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
S4226 ELITE 3 - WATT VA (AMPS) - QUANTITIES OF 1 TO 99
- ----------------------------------------------------------------------------------------------------------
ELITE 3 - WATT VA (AMPS) - QUANTITIES OF 100 TO 499
- ----------------------------------------------------------------------------------------------------------
ELITE 3 - WATT VA (AMPS) - QUANTITIES OF 500 TO 999
- ----------------------------------------------------------------------------------------------------------
ELITE 3 - WATT VA (AMPS) - QUANTITIES OF 1000 AND UP
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
S4227 MicroTAC Elite Extnd System (J2) Adptr
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
S4292 ELITE 3 - WATT VA (NAMPS) - QUANTITIES OF 1 TO 99
- ----------------------------------------------------------------------------------------------------------
ELITE 3 - WATT VA (NAMPS) - QUANTITIES OF 100 TO 499
- ----------------------------------------------------------------------------------------------------------
ELITE 3 - WATT VA (NAMPS) - QUANTITIES OF 500 TO 999
- ----------------------------------------------------------------------------------------------------------
ELITE 3 - WATT VA (NAMPS) - QUANTITIES OF 1000 AND UP
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
S4422 Elite 3 Watt (2.5) VA Adptr (Namps)
- ----------------------------------------------------------------------------------------------------------
S5415 3 WATT BOOSTER KIT FOR EE3 FLIP PHONES
- ----------------------------------------------------------------------------------------------------------
SKN4291 DPC 8 PIN MODULAR COIL CORD
- ----------------------------------------------------------------------------------------------------------
- ---------------
Brackets ([/]) indicate confidential portions omitted and filed separately with
the Commission.
- ----------------------------------------------------------------------------------------------------------
SKN4347 CHARGER CABLE DPC HF KITS
- ----------------------------------------------------------------------------------------------------------
CHARGER CABLE EXTENDED SYS
- ----------------------------------------------------------------------------------------------------------
SLN3400 Ultra Saver/Pivots Kit
- ----------------------------------------------------------------------------------------------------------
SLN5898 DPC CHARGERHOLDER
- ----------------------------------------------------------------------------------------------------------
SLN6660 99465 Elite Headset Accessory
- ----------------------------------------------------------------------------------------------------------
SLN6966 MicroTac Elite Adaptor Kit
- ----------------------------------------------------------------------------------------------------------
SPN2012 DPC DHFA JUNCTION BOX
- ----------------------------------------------------------------------------------------------------------
SPN4253 DPC CHARGERHOLDER
- ----------------------------------------------------------------------------------------------------------
SYN4637 Passive Holder - DPC
- ----------------------------------------------------------------------------------------------------------
SYN4638 Passive Holder - Elite
- ----------------------------------------------------------------------------------------------------------
</TABLE>
- ---------------
Brackets ([/]) indicate confidential portions omitted and filed separately with
the Commission.
Page 2
<PAGE>
ELITE, FLIP, POCKET PHONE ACCESSORY
PLATINUM PRICE PAGES
MARCH 1996
<TABLE>
<CAPTION>
CONTOUR/COURIER NICAD BATTERIES
Part # Pkg # Description [REDACTED]
- --------------------------------------------------------------------------------------
<S> <C> <C> <C>
SNN4263 NICD CONTOUR/COURIER BATTERY - CHAR
- --------------------------------------------------------------------------------------
SNN4324 NICD CONTOUR/COURIER BATTERY - BLX
- --------------------------------------------------------------------------------------
SNN4487 NICD CONTOUR/COURIER BATTERY - STL
- --------------------------------------------------------------------------------------
NICKEL CADMIUM BATTERIES
Part # Pkg # Description [REDACTED]
- --------------------------------------------------------------------------------------
<S> <C> <C> <C>
SNN4131 99311 SLIM BATTERY CHARCOAL
- --------------------------------------------------------------------------------------
SNN4132 SLIM BATTERY BLACK
- --------------------------------------------------------------------------------------
SNN4133 99312 SLIM BATTERY GRAY
- --------------------------------------------------------------------------------------
SNN4147 99313 SLIM BATTERY STEEL
- --------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------
SNN4102 SLIM EXTRA CAPACITY BATTERY BLACK
- --------------------------------------------------------------------------------------
SNN4103 SLIM EXTRA CAPACITY BATTERY GRAY
- --------------------------------------------------------------------------------------
SNN4104 SLIM EXTRA CAPACITY BATTERY CHARCOAL
- --------------------------------------------------------------------------------------
SNN4148 SLIM EXTRA CAPACITY BATTERY STEEL
- --------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------
SNN4313 STANDARD LITE BATT CHAR
- --------------------------------------------------------------------------------------
SNN4314 STANDARD LITE BATT BLACK
- --------------------------------------------------------------------------------------
SNN4315 STANDARD LITE BATT STEEL
- --------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------
SNN4019 STANDARD BATTERY CHARCOAL
- --------------------------------------------------------------------------------------
SNN4020 STANDARD BATTERY GRAY
- --------------------------------------------------------------------------------------
SNN4027 STANDARD BATTERY BLACK
- --------------------------------------------------------------------------------------
SNN4149 STANDARD BATTERY STEEL
- --------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------
SNN4057 99314 EXTRA CAPACITY BATTERY CHARCOAL
- --------------------------------------------------------------------------------------
SNN4058 EXTRA CAPACITY BATTERY BLACK
- --------------------------------------------------------------------------------------
SNN4059 99315 EXTRA CAPACITY BATTERY GRAY
- --------------------------------------------------------------------------------------
SNN4150 99316 EXTRA CAPACITY BATTERY STEEL
- --------------------------------------------------------------------------------------
BELT CLIP NICKEL CADMIUM BATTERIES
Part # Pkg # Description [REDACTED]
- --------------------------------------------------------------------------------------
<S> <C> <C> <C>
SNN4565 BELT CLIP SLIM BATTERY - CHARCOAL
- --------------------------------------------------------------------------------------
SNN4564 BELT CLIP SLIM BATTERY - BLACK
- --------------------------------------------------------------------------------------
SNN4566 BELT CLIP SLIM BATTERY - STEEL
- --------------------------------------------------------------------------------------
SNN4567 BELT CLIP SLIM BATTERY - SLATE
- --------------------------------------------------------------------------------------
NICKEL METAL HYDRIDE BATTERIES
Part # Pkg # Description [REDACTED]
- --------------------------------------------------------------------------------------
<S> <C> <C> <C>
SNN4238 99429 NIMH SLIM BATTERY CHARCOAL
- --------------------------------------------------------------------------------------
SNN4239 NIMH SLIM BATTERY BLACK
- --------------------------------------------------------------------------------------
SNN4240 99431 NIMH SLIM BATTERY GRAY
- --------------------------------------------------------------------------------------
SNN4241 99430 NIMH SLIM BATTERY STEEL
- --------------------------------------------------------------------------------------
SNN4336 99450 NIMH SLIM BATTERY SLATE
- --------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------
SNN4309 99432 NIMH SLIM EXTRA CAPACITY BATTERY CHARCOAL
- --------------------------------------------------------------------------------------
SNN4310 NIMH SLIM EXTRA CAPACITY BATTERY BLACK
- --------------------------------------------------------------------------------------
SNN4311 99434 NIMH SLIM EXTRA CAPACITY BATTERY GRAY
- --------------------------------------------------------------------------------------
SNN4312 99433 NIMH SLIM EXTRA CAPACITY BATTERY STEEL
- --------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------
SNN4203 NIMH STANDARD BATTERY CHARCOAL
- --------------------------------------------------------------------------------------
SNN4204 NIMH STANDARD BATTERY BLACK
- --------------------------------------------------------------------------------------
SNN4205 NIMH STANDARD BATTERY GRAY
- --------------------------------------------------------------------------------------
SNN4206 NIMH STANDARD BATTERY STEEL
- --------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------
SNN4258 99435 NIMH EXTRA CAPACITY BATTERY CHARCOAL
- --------------------------------------------------------------------------------------
SNN4259 99443 NIMH EXTRA CAPACITY BATTERY BLACK
- --------------------------------------------------------------------------------------
SNN4260 99437 NIMH EXTRA CAPACITY BATTERY GRAY
- --------------------------------------------------------------------------------------
SNN4261 99436 NIMH EXTRA CAPACITY BATTERY STEEL
- --------------------------------------------------------------------------------------
SNN4378 99451 NIMH EXTRA CAPACITY BATTERY SLATE
- --------------------------------------------------------------------------------------
</TABLE>
Prepared by Motorola March, 1996 Page 3
- ---------------
Brackets [/] indicate confidential portions omitted and filed separately with
the Commission.
<PAGE>
ELITE, FLIP, POCKET PHONE ACCESSORY
PLATNUM PRICE PAGES
MARCH 1996
<TABLE>
<CAPTION>
ALKALINE BATTERIES
Part # Pkg # Description [REDACTED]
<S> <C> <C> <C>
- ---------------------------------------------------------------------------------------------------
99322 SNN4242 ALKALINE BLACK
- ---------------------------------------------------------------------------------------------------
99323 SNN4243 ALKALINE CHARCOAL
- ---------------------------------------------------------------------------------------------------
99324 SNN4244 ALKALINE STEEL GRAY
- ---------------------------------------------------------------------------------------------------
99325 SNN4245 ALKALINE DYNA GRAY
- ---------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
MULTIPLE ITEM RETAIL PACKAGES
Part # Pkg # Description [REDACTED]
<S> <C> <C> <C>
- ---------------------------------------------------------------------------------------------------
99404 STARTER KIT (PC 550/ALPHA) Charcoal
- ---------------------------------------------------------------------------------------------------
99406 STARTER KIT (PC 550/ALPHA) Steel Gray
- ---------------------------------------------------------------------------------------------------
99410 STARTER KIT (LITE/ULTRA LITE) Charcoal
- ---------------------------------------------------------------------------------------------------
99411 STARTER KIT (LITE/ULTRA LITE) STEEL GRAY
- ---------------------------------------------------------------------------------------------------
99417 TRAVEL PAK
- ---------------------------------------------------------------------------------------------------
99418 STARTER PAK (Charcoal)
- ---------------------------------------------------------------------------------------------------
99419 STARTER PAK (Steel)
- ---------------------------------------------------------------------------------------------------
99483 Start Kit (550/Alpha) w/ Slim Batt Charcoal
- ---------------------------------------------------------------------------------------------------
99484 Start Kit (550/Alpha) w/ Slim Batt Steel
- ---------------------------------------------------------------------------------------------------
99485 Start Kit (440/Alpha) w/ Slim Batt Slate
- ---------------------------------------------------------------------------------------------------
99486 Start Kit (Lite) w/ Slim Batt Charcoal
- ---------------------------------------------------------------------------------------------------
99487 Start Kit (Lite) w/ Slim Batt Steel
- ---------------------------------------------------------------------------------------------------
99488 Start Kit (Lite) w/ Slim Batt Slate
- ---------------------------------------------------------------------------------------------------
99501 Start Kit (550/Alpha) w/ Nimh Slim Batt Charcoal
- ---------------------------------------------------------------------------------------------------
99502 Start Kit (550/Alpha) w/ Slim Batt Steel
- ---------------------------------------------------------------------------------------------------
99503 Start Kit (550/Alpha) w/ Nimh Slim Batt Slate
- ---------------------------------------------------------------------------------------------------
99504 Start Kit (Lite) w/ Nimh Slim Batt Charcoal
- ---------------------------------------------------------------------------------------------------
99505 Start Kit (Lite) w/ Nimh Slim Batt Steel
- ---------------------------------------------------------------------------------------------------
99506 Start Kit (Lite) w/ Nimh Slim Batt Slate
- ---------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
ANTENNAS
Part # Pkg # Description [REDACTED]
<S> <C> <C> <C>
- ---------------------------------------------------------------------------------------------------
SAF4120 MICRO TAC ANTENNA (3/PK)
- ---------------------------------------------------------------------------------------------------
SAF4330 MICRO TAC ANTENNA
- ---------------------------------------------------------------------------------------------------
SAF4480 MICRO TAC LITE ANTENNA
- ---------------------------------------------------------------------------------------------------
SAF4490 MICRO TAC LITE ANTENNA (3/PK)
- ---------------------------------------------------------------------------------------------------
SAF4980 ELITE REPLCMT ANTENNA
- ---------------------------------------------------------------------------------------------------
</TABLE>
Page 4
- ---------------
Brackets [/] indicate confidential portions omitted and filed separately with
the Commission.
<PAGE>
PORTABLE PHONE ACCESSORIES
PLATINUM PRICE PAGES
March 1996
PORTABLE ACCESSORIES
<TABLE>
<CAPTION>
CHARGERS & ADAPTERS
Retail
Part # Package # Description [REDACTED]
<S> <C> <C> <C>
- --------------------------------------------------------------------------------
SLN2097 PORTABLE TRAVEL CHARGER
- --------------------------------------------------------------------------------
SLN2483 VEHICLE BATT CHGR PORTABLES
- --------------------------------------------------------------------------------
SLN9231 ULTRA CLASSIC II CIGARETTE LIGHTER CHARGER
- --------------------------------------------------------------------------------
SLN9905 99448 ULTRA SAVER FOR ULTRA CLASSIC II
- --------------------------------------------------------------------------------
SPN2014 99330 OVERGHT PORT CHARGER
- --------------------------------------------------------------------------------
SPN2058 99424 OPTI - CHARGER
- --------------------------------------------------------------------------------
SPN2068 OVERNGHT CHARGER
- --------------------------------------------------------------------------------
SPN4006 AC XFRMER FOR SLN2097
- --------------------------------------------------------------------------------
SPN4021 EXPRESS 850 AC CHARGER
- --------------------------------------------------------------------------------
SPN4047 REPLCMNT BASE SPN2014
- --------------------------------------------------------------------------------
SPN4052 XFRMER SPN2015,SPN2021
- --------------------------------------------------------------------------------
SPN4139 AC TRANSFORMER FOR ULTRA CLASSIC II
INTERNAL CHARGER
- --------------------------------------------------------------------------------
SPN4159 AC POWER SUPPLY
- --------------------------------------------------------------------------------
<CAPTION>
CARRY CASES
Retail
Part # Package # Description [REDACTED]
<S> <C> <C> <C>
- --------------------------------------------------------------------------------
SLN4923 PORT NYLON CASE (L SERIES)
- --------------------------------------------------------------------------------
SLN6049 99415 OPEN FACE CARRY CASE FOR ULTRA CLASSIC
- --------------------------------------------------------------------------------
SLN6050 99414 OPEN FACE CARRY CASE FOR PORTABLE 8000
- --------------------------------------------------------------------------------
SLN6953 99453 OPEN FACE CARRY CASE FOR ULTRA CLASSIC II
- --------------------------------------------------------------------------------
TRN5806 RUBBER BOOT FOR L SERIES PORT
- --------------------------------------------------------------------------------
<CAPTION>
DATA PRODUCTS
Retail
Part # Package # Description [REDACTED]
<S> <C> <C> <C>
- --------------------------------------------------------------------------------
S3851 CELL CONNECTION FOR ULTRA CLASSIC II
- --------------------------------------------------------------------------------
S3026 CELLULAR CONNECTION FOR PORTABLE
- --------------------------------------------------------------------------------
SKN4621 DATA CABLE FOR ULTRA CLASSIC II CELL
CONNECTION
- --------------------------------------------------------------------------------
<CAPTION>
VEHICLE KITS
Retail
Part # Package # Description [REDACTED]
<S> <C> <C> <C>
- --------------------------------------------------------------------------------
S2815 DHFA BLACK
- --------------------------------------------------------------------------------
S2816 DHFA GRAY
- --------------------------------------------------------------------------------
S2817 DHFA GRAY NO MIC
- --------------------------------------------------------------------------------
S2818 DHFA CHARCOAL
- --------------------------------------------------------------------------------
S2985 DHFA STEEL
- --------------------------------------------------------------------------------
S3797 99440 STANDARD DHFA FOR ULTRA CLASSIC II - NOT
AVAIL. IN NEW RETAIL PKG.
- --------------------------------------------------------------------------------
S3846 99441 DELUXE DHFA FOR ULTRA CLASSIC II - NOT
AVAIL. IN NEW RETAIL PKG.
- --------------------------------------------------------------------------------
SKN4326 CONTROL CABLE PORTABLE DHFA
- --------------------------------------------------------------------------------
SKN4327 CHARGER CABLE DHFA PORTABLE
- --------------------------------------------------------------------------------
SLN2149 CONVERTABLE DIST BOX BCX
- --------------------------------------------------------------------------------
SLN2533 PORTABLE MOUNT EXTENDED SYS
- --------------------------------------------------------------------------------
SLN2551 DHFA PORTABLE SLIDE BLACK
- --------------------------------------------------------------------------------
SLN2917 DHFA Adaptor
- --------------------------------------------------------------------------------
SLN2573 DHFA PORTABLE SLIDE CHARCOAL
- --------------------------------------------------------------------------------
SLN2984 DHFA PORTABLE SLIDE STEEL
- --------------------------------------------------------------------------------
SLN3218 Port to Ultra Classic II HF Adaptor
- --------------------------------------------------------------------------------
</TABLE>
Prepared by Motorola March 1996 Page 1
- ---------------
Brackets [/] indicate confidential portions omitted and filed separately with
the Commission.
<PAGE>
PORTABLE PHONE ACCESSORIES
PLATINUM PRICE PAGES
MARCH 1996
<TABLE>
<CAPTION>
ANTENNAS
Retail
Part # Package # Description [REDACTED]
<S> <C> <C> <C>
- --------------------------------------------------------------------------------
SAF2000 WINDOW CLIP ANTENNA PORTABLES
- --------------------------------------------------------------------------------
SAF2020 PORTABLE ANTENNA PACKAGE
- --------------------------------------------------------------------------------
SAF4110 EXPRESS 850 WHIP ANTENNA
- --------------------------------------------------------------------------------
SAF4140 STANDARD PORTABLE ANTENNA
- --------------------------------------------------------------------------------
SAF4170 CITY STUB ANTENNA
- --------------------------------------------------------------------------------
<CAPTION>
MISCELLANEOUS
Retail
Part # Package # Description [REDACTED]
<S> <C> <C> <C>
- --------------------------------------------------------------------------------
SLN5565 PORT DHFA MNTG HARDWARE
- --------------------------------------------------------------------------------
SLN5599 CLAMSHELL MNT FOR CHRGR
- --------------------------------------------------------------------------------
<CAPTION>
Nickel Cadmium Batteries
Retail
Part # Package # Description [REDACTED]
<S> <C> <C> <C>
- --------------------------------------------------------------------------------
SNN4014 STANDARD PORT BATT GRAY
- --------------------------------------------------------------------------------
SNN4211 99321 STANDARD PORT BATT CHRG
- --------------------------------------------------------------------------------
SNN4212 99320 STANDARD PORT BATT STEEL
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SNN4038 UC STD PORT BATT GRAY
- --------------------------------------------------------------------------------
SNN4040 UC STD PORT BATT GRAY
- --------------------------------------------------------------------------------
SNN4214 99317 UC STD PORT BATT STEEL
- --------------------------------------------------------------------------------
SNN4114 99305 UC STD PORT BATTY CHAR
- --------------------------------------------------------------------------------
SNN4423 99496 UC STD PORT BATT SLATE GRAY
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SNN4041 UC SLIM PORT BATT GRAY
- --------------------------------------------------------------------------------
SNN4042 99307 UC SLIM PORT BATT CHAR
- --------------------------------------------------------------------------------
SNN4043 UC SLIM PORT BATT BLACK
- --------------------------------------------------------------------------------
SNN4213 99318 UC SLIM PORT BATT STEEL
- --------------------------------------------------------------------------------
SNN4424 99495 UC SLIM PORT BATT SLATE
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SNN4023 ULTRA HI CAP PORT BATT GRAY
- --------------------------------------------------------------------------------
SNN4024 ULTRA HI CAP PORT BATT CHAR
- --------------------------------------------------------------------------------
SNN4025 ULTRA HI CAP PORT BATT BLACK
- --------------------------------------------------------------------------------
SNN4235 ULTRA HI CAP PORT BATT STEEL
- --------------------------------------------------------------------------------
<CAPTION>
NICKEL METAL HYDRIDE BATTERIES
Retail
Part # Package # Description [REDACTED]
<S> <C> <C> <C>
- --------------------------------------------------------------------------------
SNN4207 NIMH SLIM PORT BATT CHAR
- --------------------------------------------------------------------------------
- ---------------
Brackets ([/]) indicate confidential portions omitted and filed separately with
the Commission.
- --------------------------------------------------------------------------------
SNN4208 NIMH SLIM PORT BATT BLACK
- --------------------------------------------------------------------------------
SNN4209 NIMH SLIM PORT BATT GRAY
- --------------------------------------------------------------------------------
SNN4210 NIMH SLIM PORT BATT STEEL
- --------------------------------------------------------------------------------
</TABLE>
- ---------------
Brackets ([/]) indicate confidential portions omitted and filed separately with
the Commission.
Prepared by Motorola March 1996 Page 2
<PAGE>
PORTABLE PHONE ACCESSORIES
PLATINUM PRICE PAGES
March 1996
<TABLE>
<CAPTION>
INTRINSICALLY SAFE BATTERIES
Retail
Part # Package # Description [REDACTED]
<S> <C> <C>
- -----------------------------------------------------------------------------
SNN4088 UC FM APPROVED DYNA GRAY
- -----------------------------------------------------------------------------
SNN4089 UC FM APPROVED CHARCOAL
- -----------------------------------------------------------------------------
SNN4090 UC FM APPROVED BLACK
- -----------------------------------------------------------------------------
SNN4273 UC FM APPROVED STEEL GRAY
- -----------------------------------------------------------------------------
BATTERY SAVERS
Retail
Part # Package # Description [REDACTED]
<S> <C> <C>
- -----------------------------------------------------------------------------
SLN2110 PORTABLE TBS GRAY
- -----------------------------------------------------------------------------
SLN2351 99309 PORTABLE TBS CHARCOAL
- -----------------------------------------------------------------------------
SLN2554 PORTABLE TBS BLACK
- -----------------------------------------------------------------------------
SLN2985 99319 PORTABLE TBS STEEL
- -----------------------------------------------------------------------------
SLN3238 99494 PORTABLE TBS SLATE GRAY
- -----------------------------------------------------------------------------
MULTIPLE RETAIL PACKAGES
Retail
Part # Package # Description [REDACTED]
<S> <C> <C>
- -----------------------------------------------------------------------------
99408 99408 STARTER KIT UC (Charcoal)
- -----------------------------------------------------------------------------
99409 99409 STARTER KIT UC (Steel Gray)
- -----------------------------------------------------------------------------
99422 99422 ULTRA TRAVEL PAK (Charcoal)-NOT AVAIL. IN
NEW RETAIL PKG.
- -----------------------------------------------------------------------------
99454 99454 STARTER KIT FOR ULTRA CLASSIC II (Charcoal)
- -----------------------------------------------------------------------------
99455 99455 STARTER KIT FOR ULTRA CLASSIC II (Steel)
- -----------------------------------------------------------------------------
99493 99493 STARTER KIT FOR ULTRA CLASSIC II (Slate)
- -----------------------------------------------------------------------------
</TABLE>
- ---------------
Brackets ([/]) indicate confidential portions omitted and filed separately with
the Commission.
Prepared by Motorola March 1996 Page 3
<PAGE>
MOTOROLA
LIMITED WARRANTY
MOTOROLA, INC. (Motorola) warrants this Motorola cellular accessory against
defects in material and workmanship under normal use for ONE YEAR from the date
of original retail purchase. This warranty extends to the original retail
purchaser only and is not transferable. Motorola, at its option, will at no
charge either repair the accessory (with new or reconditioned parts) or replace
the accessory or refund the purchase price of the accessory during the warranty
period. Repaired/replacement accessories are warranted for either ninety days
or the remainder of the original warranty period, whichever is longer. All
replaced items become Motorola's property. This warranty does not cover defects
or damage resulting from abnormal use, misuse, mishandling, neglect, accident or
tampering.
You can obtain warranty service through your original place of purchase in most
cases. Or you can obtain warranty service by returning the accessory directly
to Motorola. In either case, you must return the accessory with transportation
prepaid and provide proof that the accessory is within the warranty period (for
example, a dated purchase receipt). For more information, including about
returning an accessory to Motorola, please call the Motorola Cellular
Information Center toll-free at 1-800-331-6456 in the USA.
THIS IS THE COMPLETE WARRANTY FOR THE ACCESSORY BY MOTOROLA AND SETS FORTH YOUR
EXCLUSIVE REMEDIES. THIS WARRANTY IS GIVEN IN LIEU OF ALL OTHER EXPRESS
WARRANTIES. IMPLIED WARRANTIES, INCLUDING WITHOUT LIMITATION THE IMPLIED
WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE, ARE LIMITED
TO THE DURATION OF THIS LIMITED WARRANTY. IN NO EVENT SHALL MOTOROLA BE LIABLE
FOR DAMAGES IN EXCESS OF THE PURCHASE PRICE OF THE ACCESSORY OR FOR ANY
INCIDENTAL, SPECIAL OR CONSEQUENTIAL DAMAGES ARISING OUT OF THE USE OR INABILITY
TO USE SUCH ACCESSORY TO THE FULL EXTENT SUCH MAY BE DISCLAIMED BY LAW:
Some states do not allow the exclusion or limitation of incidental or
consequential damages, or limitations on how long an implied warranty lasts, so
the above limitations or exclusions may not apply to you. This warranty gives
you specific legal rights, and you may also have other rights which vary from
state to state.
This warranty is valid only in the USA.
68P09372AB3
