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EX-10.i.a
PARTIAL LIQUIDATION AGREEMENT
BY AND BETWEEN
GLOBAL RESOURCES GROUP, INC.
and
INTERNATIONAL TELEDATA AND ITS SHAREHOLDERS
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Dated: March 20, 1998
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Table of Contents
1. Delivery of Assets of the Company ................................................................ 1
2. Consideration for Transfer of Assets ............................................................... 1
3. Miscellaneous Provisions Relating to Delivery of Global Resources
Group, Inc.'s Common Stock ............................................................................ 1
4. Access to Books and Records .......................................................................... 2
5. Closing................................................................................................ 2
6. Representations and Warranties of the Shareholders ..................................... 2
a. Organization and Standing..................................................................... 2
b. Subsidiaries, Etc............................................................................. 2
c. Capital Stock................................................................................. 3
d. Indebtedness.................................................................................. 3
e. Financial Statements............................................................. ............ 3
f. Contracts and Other Commitments ....................................................... 3
g. Intellectual Property......................................................................... 4
h. Assets........................................................................................ 4
i. Insurance..................................................................................... 5
j. Litigation.................................................................................... 5
k. Accounts Receivable........................................................................... 5
l. Inventories................................................................................... 6
m. Purchase Commitments and Outstanding Bids ..................................... 6
n. Real Estate................................................................................... 6
o. Changes, Dividends, Etc....................................................................... 6
p. Tax Returns and Liabilities................................................................... 7
q. Breaches of Contracts, Etc.................................................................... 7
r. Title to Company Stock........................................................................ 7
s. Conflict of Interests......................................................................... 8
t. Disclosure.................................................................................... 8
7. Representations and Warranties of Global Resources Group, Inc. .................. 8
a. Organization and Standing .................................................................. 8
b. Capital Stock.................................................................................. 9
c. Validity of Shares............................................................................. 9
d. Changes, Dividends, Etc. .................................................................... 9
e. Authorization of Agreement .................................................................. 9
f. No Violation of Law, Etc. ..................................................................... 9
g. Financial Statements........................................................................... 9
h. No Material Changes........................................................................... 9
8. Conditions to Obligations of Global Resources Group, Inc. .......................... 10
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Table of Contents
9. Conditions to Obligations of the Company and the Shareholders ................. 12
10. Certain Covenants Prior to Closing ............................................................... 14
11. Survival of Representations and Warranties; Indemnification ........................ 15
a. Survival..................................................................................... 15
b. Indemnification by Company and Shareholders ................................. 15
c. Indemnification by Global Resources Group, Inc. ............................... 16
d. Procedure for Indemnification ............................................................. 16
e. After - Tax Basis............................................................................ 17
12. Investment Representation ............................................................................ 17
13. Further Assurances.................................................................................... 18
14. Expenses.............................................................................................. 19
15. Partial Liquidation................................................................................... 19
16. Directors............................................................................................. 19
17. Other Matters......................................................................................... 19
a. No Other Agreements ......................................................................... 19
b. Amendment.................................................................................... 19
c. Notices...................................................................................... 19
d. Specific Performance......................................................................... 19
e. Assignment................................................................................... 20
f. Paragraphs and Other Headings ........................................................ 20
g. Choice of Law................................................................................ 20
h. No Waiver.................................................................................... 20
i. Severability................................................................................. 20
j. Counterparts................................................................................. 20
k. Non-Competition Agreement ............................................................... 20
1. Definitions ........................................................................ 21
2. Ownership ......................................................................... 21
3. Term .............................................................................. 21
4. Remedies............................................................................ 21
5. Disclaimer ........................................................................ 22
18. Settlement of the Company's Debentures ...................................................... 22
19. The Company's Dividends .............................................................................. 22
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PARTIAL LIQUIDATION AGREEMENT
PARTIAL LIQUIDATION AGREEMENT (the "Agreement"), dated as of March 20,
1998, between Global Resources Group, Inc., a Nevada corporation ("GRG") and
International TeleData Corporation, a New York corporation (the "Company") and
all of the Shareholders of the Company whose names appear in Exhibit "A" hereto
("Shareholders").
Witnesseth:
WHEREAS, the Shareholders represent that they are the legal and
beneficial owners of all of the outstanding shares of capital stock of the
Company; and
WHEREAS, the Shareholders desire to sell its overseas long distance
telecommunications aggregation business for shares of Common Stock of GRG, and
GRG desires to effect such exchange, all on the terms and conditions hereinafter
set forth in such a manner that the exchange will constitute a tax-free partial
liquidation pursuant to the provisions of the Internal Revenue Code of 1986, as
amended.
NOW THEREFORE, in consideration of the premises and the mutual
agreements and undertakings hereinafter set forth, the parties do hereby adopt
said plan of reorganization, and, in order to consummate said plan, do hereby
agree as follows:
1. Delivery of Assets of the Company. The Company agrees to transfer and deliver
to GRG, and GRG agrees to acquire the assets, contracts and leads relating to
its long distance telecommunications international aggregation business,
including but not limited to those contracts known as the CFC deal and China I
and China II deals, as more fully described in Exhibit "A" attached.
2. Consideration for Transfer of Assets. Upon the terms and subject to the
conditions set forth in this Agreement, GRG agrees to deliver 1,000,000 shares
to the Company upon closing and, 4,000,000 shares shall be placed in escrow to
be released upon signing contracts yielding in excess of four-million dollars
($4,000,000.00) of gross profit. In addition to the stock transfer, GRG will
advance to the Company up to six- hundred thousand dollars ($600,000.00) and up
to an additional one-million dollars ($1,000,000.00) within thirty (30) business
days of Closing which will be used specifically for working capital for the
Company. In addition, one (1) seat will be made available and will be filled
immediately on the Board of Directors of GRG by a designated individual of the
Company.
3. Miscellaneous Provisions Relating to Delivery of GRG's Common Stock. No
fractional shares of Common Stock of GRG will be delivered and the number of
shares to be issued to any of the Shareholders will be rounded up to the nearest
whole share if the Shareholder is entitled to receive one-half or more of a
share and rounded down to the nearest whole share if the Shareholder is entitled
to receive less than one-half of a share.
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4. Access to Books and Records. Except as hereinafter provided, GRG and its
officers, employees and agents, shall have full access at all reasonable times
from and after the date hereof to the plants, facilities, books and records of
the Company and the Company shall cooperate fully with GRG to the end that it
may become familiar with the properties and business of the Company. GRG agrees
to treat any information which is disclosed to GRG by the Company and is
proprietary or confidential to the Company, as confidential information, and in
the event the closing does not take place, all documents will be returned to the
Company and GRG and will not make or retain copies of any documents or make use
of any confidential information disclosed to it in the conduct of its business.
5. Closing. The Closing of the exchange provided for herein will take place at
GRG's office at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇
on March 20, 1998, such date being herein referred to as the "Closing Date". At
the Closing, the Shareholders arranged to deliver to GRG all certificates,
assignments, and other instruments which may be necessary, desirable, or
appropriate in order to transfer to GRG all of the outstanding shares of capital
stock of the Company, all in form and substance reasonably satisfactory to
counsel for GRG. At such Closing, GRG shall deliver to the Company certificates
evidencing the shares of Common Stock of GRG to be delivered to the Shareholders
pursuant to Paragraph 2 hereof, together with such other instruments which may
be necessary, desirable, or appropriate to accomplish such transfers, all in
form and substance satisfactory to counsel for Shareholders.
6. Representations and Warranties of the Shareholders. The Shareholders jointly
and severally represent and warrant to and agree with GRG as follows:
a. Organization and Standing. The Company is a corporation duly
organized, validly existing and in good standing under the laws of the
State of New York, with full corporate power to carry on its business
as now being conducted and to own and operate the property and assets
now owned and operated by it, and is duly qualified to transact
business and in good standing in each jurisdiction where the ownership
of its properties or the conduct of its business requires it to be
licensed or qualified to do business. The Company also delivered to GRG
a copy of its Articles of Incorporation and all amendments thereto,
certified by the Secretary of State of the State of New York, and a
copy of its By-Laws as amended, certified by its Secretary, which
documents are complete and correct as of the date of this Agreement.
b. Subsidiaries, Etc. The Company has no subsidiaries and is not party
to any partnership, joint venture of similar agreement, except as
disclosed in the schedule referred to in subparagraph (f) of Paragraph
6 hereof.
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c. Capital Stock. The authorized capital stock of the Company consists
of 20,000,000 shares of Common Stock, $0.001 par value, of which
8,936,440 shares are validly issued and outstanding. All of said
outstanding shares of the Company have been duly authorized and validly
issued, are fully paid and nonassessable. There are no options,
warrants or other agreements or commitments which are now or may in the
future obligate the Company to issue or purchase any shares of its
capital stock or other securities.
d. Indebtedness. The Company has delivered to GRG a schedule,
identified by reference to this subparagraph, listing all promissory
notes payable by the Company, all agreements of the Company to borrow
money from others, and all commitments by others to lend money to the
Company. As to each note, obligation to borrow and loan commitment,
such schedule accurately sets forth the interest rate, terms of payment
of principal and interest, identity of security (if any) and any other
material terms of such indebtedness. The Company is not in default in
any respect under, and is not otherwise, in violation or contravention
of, any of the terms or provisions of any note, loan agreement,
agreement to borrow money from others or any commitment by others to
lend money.
e. Financial Statements. The Company has delivered to GRG a balance
sheet (the "Balance Sheet") of the Company as of December 31, 1997 (the
"Balance Sheet Date") and an income statement and statement of retained
earnings for the year then ended. Such statements have been initialed
by officers of the Company and GRG for identification. All of such
financial statements are complete and fairly present the financial
position of the Company on the indicated dates and the results of its
present financial position of the Company on the indicated dates and
the results of its operations for the indicated periods. All of such
statements have been prepared on the tax basis of accounting
consistently applied. The Company has no liabilities, whether absolute,
accrued, contingent or otherwise, other than (i) liabilities disclosed,
(ii) incurred in "arms-length" transactions in the ordinary course of
business since the Balance Sheet Date and (iii) liabilities disclosed
in subparagraph (k) of this Paragraph 6 or the schedule referred to in
subparagraph (f) of this paragraph 6.
f. Contracts and Other Commitments. The Company has delivered to GRG a
complete and accurate schedule, identified by reference to this
subparagraph, listing and briefly describing all Material Contracts.
For this purpose, the term "Material Contracts" shall be defined to
mean (i) all contracts and commitments out of the ordinary course of
business; (ii) all contracts and commitments involving an obligation
which cannot or, in reasonable probability, will not be performed or
terminated within sixty (60) days from the date hereof; (iii) all
bonus, incentive compensation, pension, group insurance or employee
welfare plans of any nature whatsoever; (iv) all collective bargaining
agreements or other contracts or commitments to or with any labor
unions or other employee representatives or
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groups of employees; (v) employment contracts and other contracts,
agreements or commitments to or with individual employees, agents or
consultants extending for a period of more than three (3) months from
the date hereof or providing for earlier termination only upon the
payment of a penalty or equivalent thereof; or (vi) all other contracts
or commitments providing for payments based in any manner upon the
sales, purchases or profits of the Company. There has not been any
material default in any obligation to be performed by the Company under
any material contract listed on the said schedule, and the Company has
not waived any material right under any such material contract.
g. Intellectual Property. The Company owns, or is licensed or otherwise
has the full and exclusive rights to use, all patents, trademarks,
trade names, copyrights, technology, know-how, processes, names and
likenesses used in or necessary for the conduct of its business as
heretofore conducted. The Company has delivered to GRG a complete and
accurate schedule identified by reference to this subparagraph, listing
all domestic and foreign patents, patent applications, licenses,
formulae, trademarks, trade names and copyrights owned or held by the
Company and a summary of the terms of all agreements relating to
technology, know-how or processes which the Company is licensed or
authorized to use by others. Except as set forth in this schedule, the
Company is licensed or authorized to use by others. Except as set forth
in this schedule, the Company has the sole and exclusive right to use
the patents, trademarks, trade names, copyright, technology, know-how,
processes, names and likenesses referred to therein, and the
consummation of the contemplated transactions will not alter or impair
any such rights; no claims have been asserted by any person to the use
of any such patents, trademarks, trade names, copyrights, technology,
know-how, processes, names and likenesses or challenging or questioning
the validity or effectiveness of any such licenses or agreements, and
there is no valid basis for any such claim and the use of such patents,
trademarks, trade names, copyrights, technology, know-how, processes,
names and likenesses by the Company does not infringe on the rights of
any person.
h. Assets. The Company has delivered to GRG a complete and accurate
schedule, identified by reference to this subparagraph, containing (i)
a complete legal description of all real property owned, leased or
otherwise used or occupied by the Company, (ii) a list of all banks and
other institutions in which the Company has any account or safe deposit
showing the identifying numbers and names of the persons authorized to
draw thereon or have access thereto, and (iii) a list of all
capitalized machinery, tools, equipment owned, leased or otherwise used
by the Company. Except as disclosed on the schedule referred to in
subparagraph (f) of this Paragraph 6, except as disclosed in the
schedule of assets supplied pursuant to this subparagraph, and except
as acquired after the date hereon on terms approved by GRG, the Company
and good and marketable title to all property and assets used in its
business, including all property and assets
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reflected in the schedule referred to in this subparagraph and in the
Balance Sheet and all properties and assets acquired after the Balance
Sheet Date (other than assets disposed of since the Balance Sheet Date
in the ordinary course of business), subject to no liens, mortgages,
pledges, encumbrances or charges of any kind. The machinery, equipment
and other facilities of the Company are in satisfactory operating
condition and repair for the business now conducted by the Company. At
the Closing, the Company will deliver to Buyer copies of all records,
including all signatures or authorization cards, pertaining to such
safe deposit boxes and bank accounts.
i. Insurance. The Company has delivered to GRG a complete and accurate
schedule, identified by reference to this subparagraph, listing and
briefly describing all policies of fire, liability, life, workmen's
compensation and other insurance maintained by the Company. All such
policies are in full force and effect, all premiums with respect
thereto covering all periods up to and including the Closing Date have
been paid, and no notice of cancellation or termination has been
received with respect to any such policy. Such policies are sufficient
for compliance with all requirements of law and all agreements to which
the Company is a party; are valid, outstanding and enforceable
policies; provide adequate insurance coverage for the assets and
operations of the Company, will remain in full force and effect through
the Closing Date without the payment of additional premiums, and will
not in any way be affected by, or terminate or lapse by reason of, the
contemplated transactions. The schedule provided by the Company
identifies all risks that have been designated as being self insured.
No insurance carrier has refused to insure any operations or property
assets of the Company, nor has any insurance carrier, which has
carried, or received any application for, any such insurance limited
the coverage during the last three (3) years.
j. Litigation. Except as identified in a complete and accurate
schedule, identified by reference to this subparagraph and delivered to
GRG, the Company is not engaged in or threatened with any legal action
or other proceeding before any court or administrative agency. The
Company has not violated any laws, regulations or order applicable to
its business or activities, and the conduct of the present business of
the Company at the present location is in conformity with all zoning
and building code requirements.
k. Accounts Receivable. All accounts receivable of the Company, whether
or not reflected in the Balance Sheets or the Interim Balance Sheet,
represent sales actually made in the ordinary course of business, and
are current and collectible net of any reserves shown on the Balance
Sheets or the Interim Balance Sheet (which reserves are adequate and
were calculated consistent with past practice). Subject to such
reserves, each of the accounts receivable has been collected in full or
will be collected in full, without any set-off, within ninety (90) days
after the day on which it first becomes due and payable.
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l. Inventories. All inventory of the Company, whether or not reflected
in the Balance Sheets or the Interim Balance Sheet, consists of a
quality and quantity usable and salable in the ordinary course of
business, except for obsolete items and items of below-standard
quality, all of which have been written off or written down to net
realizable value in the Balance Sheets or the Interim Balance Sheet.
All inventories not written off have been recorded at the lower of
average cost or market. The quantities of each type of inventory
(whether raw materials, work-in-process, or finished goods) are not
excessive, but are reasonable and warranted in the present
circumstances of the Company. All work in process and finished goods
inventory is free from any defect or other deficiency.
m. Purchase Commitments and Outstanding Bids. No purchase commitment of
the Company is in excess of normal, ordinary and usual requirements of
its business, or was made at any price in excess of the then current
market price, or contains terms and conditions more onerous than those
usually and customary in the industry. In the aggregate, the
outstanding bids, sales proposals, contracts or unfilled orders of the
Company (i) will not (based on today's costs and reasonably foreseeable
increases in such costs) require the Company to supply goods or
services at cost to the Company in excess of the revenues to be
received therefrom, and (ii) quote prices which include a ▇▇▇▇-up over
reasonably estimated costs consistent with past ▇▇▇▇-ups on similar
business.
n. Real Estate. The Company shall have delivered to GRG a schedule
identified by reference to this subparagraph listing all contracts or
commitments affecting ownership of, title to, use of, or any interest
in real estate. All such leases of real property are valid, binding,
and enforceable in accordance with their terms, and are in full force
and effect; there are no existing defaults (or events which, with
notice or lapse of time or both, would constitute a default) by the
Company, and all lessors under such leases have consented (where such
consent is necessary) to the consummation of the contemplated
transactions without requiring modification in the rights or
obligations of the lessee under such leases and all such consents are
listed in the schedule provided to GRG. The Company has delivered
executed counterpart copies of all consents referred to in the
preceding sentence to GRG.
o. Changes, Dividends, Etc. Since the Balance Sheet Date there has been
no material adverse change in the condition (financial or otherwise),
physical assets, capitalization or business of the Company, no dividend
or other distribution declared, paid or made on any of the shares of
the Company's capital stock, no direct or indirect redemption, purchase
or other acquisition by the Company of any shares of its capital stock,
no damage, destruction or loss (whether or not covered by insurance)
adversely affecting the properties, business or prospects of the
Company, no increase in the rate of compensation payable or to become
payable to any officer or other employee of the Company (except as
disclosed in the
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schedule referred to in subparagraph (j) of the Paragraph 6 or approved
in writing by GRG), no significant labor disturbances, and no other
event or condition which materially and adversely affects the business
of the Company. Since the Balance Sheet Date, the business of the
Company has been conducted diligently and in the ordinary course; the
Company has not sold or transferred any of its property or assets
except in the ordinary course of business, and no contracts have been
entered into by the Company except in the ordinary course of business
or with the written approval of GRG.
p. Tax Returns and Liabilities. The Company has filed on a timely basis
all tax returns that are or were required to be filed pursuant to the
laws, regulations or administrative requirements of each governmental
body with taxing power of it or its assets. The Company has delivered
to GRG all such Tax Returns filed since the Company's inception. The
Company has paid, all Taxes that have or may have become due pursuant
to those Tax Returns, or otherwise, or pursuant to any assessment
received by the Company, except such Taxes, if any, as are set forth in
a schedule and are being contested in good faith and as to which
adequate reserves (determined in accordance with the tax basis of
accounting consistently applied) have been provided for in the Balance
Sheets and Interim Balance Sheets.
q. Breaches of Contracts, Etc. Neither the execution nor the delivery
of this Agreement by the Company, nor the performance of any of its
obligations hereunder, will result in a breach or violation of any term
or provision of or constitute a default under any indenture, mortgage
or other agreement or instrument to which the Company is a party.
Neither the execution nor the delivery of this Agreement by the
Shareholders, nor the performance of any of their obligations
hereunder, will result in a breach or violation of any term or
provision of or constitute a default under any indenture, mortgage, or
other agreement which any of them is bound, or any law or order, rule,
regulation, writ, injunction or decree of any government, governmental
instrumentality or court having jurisdiction over the Shareholders or
any of their assets or rights, or results in the creation or imposition
of any lien, charge or encumbrance of any kind whatsoever on any of
such assets or rights.
r. Title to Company Stock. Each of the Shareholders represents and
warrants for themselves and not for the others; that this Agreement has
been duly executed and delivered by the Shareholder(s) and is, as to
themselves, a valid agreement binding upon them in accordance with its
terms; that he individually has valid title to the shares of capital
stock of the Company set forth opposite their name in Exhibit "A"
hereto, with full right, power and authority to transfer, sell and
deliver such shares pursuant to this Agreement; and that, upon delivery
of their shares pursuant to this Agreement, GRG will receive valid and
marketable title to their shares, free and clear of all voting or other
trust arrangements, liens, encumbrances, restrictions, and adverse
claims, whether existing or contingent.
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s. Conflict of Interests. Neither the Company nor any of its affiliates
(as this term is defined in the Securities Act of 1933 [the "1933 Act"]
and in the rules and regulations promulgated by the Securities and
Exchange Commission ["SEC"] thereunder) has, either directly or
indirectly, (i) an interest in any corporation, partnership,
proprietorship, association or other person or entity which produces or
sells those products and services which are produced or sold by the
Company, or (ii) a beneficial interest in any contract or agreement to
which the Company is a party or by which the Company may be bound. For
the purpose of this subparagraph, there shall be disregarded any
interest which arises solely from the ownership of less than a 5%
equity interest in a corporation which has a class of securities
regularly traded on any securities exchange or in the over-the-counter
market, or quoted on any inter dealer quotation system.
t. Disclosure. No representations or warranties by the Shareholders or
the Company in this Agreement and no statement contained in any
document (including, without limitation, financial statements, the
schedules), certificate, or other writing furnished or to be furnished
to GRG or any of its representatives pursuant to the provisions hereof
or in connection with the contemplated transactions, contains or will
contain any untrue statement of material fact or omits or will not
state any material fact necessary to make the statements herein or
therein, in light of the circumstances under which they are made, not
misleading. Documents delivered or to be delivered to GRG pursuant to
this Agreement are or will be true and complete copies of what they
purport to be. There is no fact known to the officers, directors or
employees of the Company unknown to GRG on the date of this Agreement
that may affect or does affect in a materially adverse manner GRG's
ability to conduct the business of the Company substantially as
conducted prior to such date.
7. Representations and Warranties of GRG. GRG represents and warrants to and
agrees with the Company as follows:
a. Organization and Standing. GRG is a corporation duly organized,
validly existing and in good standing under the laws of the State of
Nevada, with full corporate power to carry on its business as now being
conducted and to own and operate the property and assets now owned and
operated by it, and is duly qualified to transact business and in good
standing in each jurisdiction where the ownership of its properties or
the conduct of its business requires it to be licensed or qualified to
do business.
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b. Capital Stock. The authorized capital stock of GRG consists of
100,000,000 shares of Common Stock, $.0005 par value, 10,350,000 shares
of Common Stock are presently issued and outstanding. All of said
outstanding shares are validly issued, fully paid and non-assessable.
At the close of business on March 4, 1998 an aggregate of -0- shares of
Common Stock of GRG were reserved for issuance upon the exercise of
options granted and which may be granted to employees of GRG and its
subsidiaries, and no additional shares were reserved for issuance upon
conversion of outstanding convertible subordinate debentures.
c. Validity of Shares. The shares of Common Stock to be delivered by
GRG pursuant to this Agreement will, when so delivered, be validly
issued and outstanding, fully paid and non-assessable.
d. Changes, Dividends, Etc. Prior to the Closing hereunder, GRG will
not split, combine or otherwise change or reclassify its outstanding
Common Stock or declare or distribute any cash or stock dividend upon
such Common Stock.
e. Authorization of Agreement. GRG's Board of Directors has duly
authorized the execution, delivery and performance of this Agreement by
GRG has been duly authorized by GRG's Board of Directors, and will not
result in any breach of or violate or constitute a default under its
Articles of Incorporation or By-Laws or any indenture, mortgage or
other agreement or instrument to which it is a party.
f. No Violation of Law, Etc. Neither the execution, nor the delivery of
this Agreement by GRG, nor the performance of any of its obligations
hereunder will result in a breach or violation of any law, order, rule,
regulation, writ, injunction or decree or any governmental
instrumentality or court having jurisdiction over GRG or any of its
assets or rights, or result in the creation or imposition of any lien,
charge or encumbrance of any kind whatever on any of such assets or
rights.
g. Financial Statements. GRG has delivered to the Company its annual
reports for the past two (2) years which contains a consolidated
balance sheet as of December 31, 1996, and the related statement of
consolidated income for the year then ended. Such financial statements
have been initialed by officers of GRG and the Company for
identification. Such financial statements are complete, have been
prepared in accordance with the tax basis of accounting consistently
applied and fairly present the consolidated financial position of GRG
at such date, and the results of its operations for the period therein
specified.
h. No Material Changes. Since December 31, 1997, there has been no
material change in the condition (financial or otherwise), assets,
liabilities, capitalization or business of GRG, which have not been
disclosed to the Company.
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8. Conditions to Obligations of GRG. The obligations of GRG under this Agreement
are of the following conditions precedent:
a. All representations and warranties of the Shareholders and the
Company contained herein and in any certificate or other investment
delivered pursuant to the provisions hereof, or in connection with the
transactions contemplated hereby, shall be true on the Closing Date
with the same force and effect as though such representations and
warranties had been made on the Closing Date.
b. The Shareholders and the Company shall have performed and complied
with all of the terms, covenants and conditions of this Agreement to be
performed or complied with by them, respectively, on or before the
Closing Date.
c. The Directors of the Company shall have taken all necessary action
to authorize the execution and performance of this Agreement, and the
Company shall have delivered to GRG true and complete copies, certified
by the Secretary, of Resolutions of its Board of Directors evidencing
such action.
d. The Shares of GRG's Common Stock, $.0005 par value, which are to be
delivered on the Closing Date to the Shareholders in accordance with
the terms hereof shall have been listed or authorized to be listed on
the Exhibit "B".
e. The Shareholders and the Company shall have delivered to GRG such
certificates dated as of the Closing Date. Certifying in such detail as
GRG may reasonably request to the fulfillment of the conditions
specified in this Paragraph 8. No legend or other reference to any
purported encumbrance shall appear on any certificate. The delivery of
certificates to GRG provided in Paragraph 2 will result in GRG's
immediate acquisition of record and beneficial ownership of the Shares,
free and clear of all encumbrances (which term shall be hereinafter
defined as any security interest, mortgage, lien charge, adverse claim
or restriction of any kind, including, but not limited to, any
restriction on the use, voting, transfer, receipt of income or other
exercise of any attributes of ownership).
f. The Company shall have delivered to GRG an opinion of its counsel
for the Shareholders and the Company, dated as of the Closing Date, to
the effect that:
i. The Company is duly organized, validly existing and in good
standing under the laws of the State of Florida, with full
corporate power and authority to enter into and perform its
obligations under this Agreement, to own and hold its
properties owned and leased and to carry on the business in
which it is engaged, and is legally qualified to do business
as a foreign corporation in good standing in each jurisdiction
wherein the nature of its activities or its properties owned
or leased makes such qualification necessary.
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ii. The execution, delivery and performance of this Agreement
and the instruments executed and delivered to GRG pursuant to
this Agreement by the Company, have been duly and validly
authorized and approved (as required by law and the terms of
this Agreement) by the Company's Board of Directors and this
Agreement and such instruments have been duly executed and
delivered by the Company and the Shareholders and constitute
the valid and binding obligation of the Company and the
Shareholders, respectively, enforceable in accordance with
their respective terms, except as limited by bankruptcy,
insolvency and other laws affecting the enforcement or
creditor's rights.
iii. The execution, delivery and performance of this Agreement
and the consummation of the transactions contemplated herein
will not result in any breach or violation of any of the terms
or provisions of, or constitute a default under, the Company's
Articles of incorporation or By-Laws, or, to the knowledge of
such counsel, any term or provision of any indenture,
mortgage, deed of trust, lease, loan agreement, security
agreement, or other agreement, instrument, commitment or
arrangement, to which the Company or any of its Shareholders
is a party or by which the Company or any of the Shareholders
is bound or to which any of the Company's properties is
subject.
iv. The Company is authorized by its Articles of Incorporation
to issue 20,000,000 shares of capital stock, $0.001 par value,
of which there are 8,936,440 shares issued and outstanding,
all of which are duly authorized, validly issued and
outstanding, fully paid or nonassessable, and the issuance and
sale of such shares did not to the knowledge of such counsel
violate the 1933 Act or the rules and regulations of the SEC
thereunder or any applicable state securities or Blue Sky
Laws. The Company has no other authorized or outstanding
series or class of capital stock or other securities, or
outstanding options, warrants or other rights to acquire
securities of the Company. The Shareholders are the record and
beneficial owners of the respective number of shares of the
Company's capital stock set forth opposite their names in
Exhibit "A" hereto.
v. Insofar as is known to such counsel, all assignments,
powers and other documents necessary to effect the transfer
and delivery of the outstanding shares of capital stock of the
Company to GRG as provided for herein have been duly executed
and delivered by the Shareholders and are adequate to transfer
to GRG valid and marketable title to said shares.
vi. Such counsel has no knowledge of any litigation,
proceeding or governmental investigation or labor dispute or
labor trouble, pending or threatened against the Company,
except matters specifically mentioned in the schedule required
by subparagraph (m) of Paragraph 6 above.
103
vii. The issuance and delivery of the shares of GRG's Common
Stock to be issued and delivered to the Shareholders pursuant
to Paragraph 2 hereof is exempt from the registration or
qualification requirements of the state securities laws of the
State of Florida.
In rendering such opinion, such counsel may rely on certificates of public
officials and upon certificates of officers of the Company and the Shareholders
and upon opinions of counsel retained by the Company or the Shareholders in
States other than Florida, copies of which certificates and opinion shall be
furnished to GRG.
g. No action or proceeding by any governmental body or agency shall
have been threatened, asserted or instituted to restrain or prohibit
the carrying out of the transactions contemplated by this Agreement.
h. All corporate and other proceedings and action taken in connection
with the transactions contemplated by this Agreement and all
certificates, opinions, agreements, instruments, and documents
mentioned in this Paragraph 8 or incident to any such transaction shall
be reasonably satisfactory in form and substance to GRG and to its
counsel.
The conditions contained in this Paragraph 8 are included herein for the benefit
of GRG and, without constituting a waiver of any of its rights hereunder, may be
waived, in whole or in part, by GRG.
9. Conditions to Obligations of the Company and the Shareholders. The Company
and the Shareholders under this Agreement are subject to the fulfillment, on or
before the Closing Date, of the following conditions:
a. All representations and warranties of GRG contained herein and in
any certificate or other instrument delivered pursuant to the
provisions hereof, or in connection with the transactions contemplated
hereby, shall be true on the Closing Date with the same force and
effect as though such representations and warranties had been made on
the Closing Date.
b. GRG shall have performed and complied with all of the terms,
covenants and conditions of this Agreement to be performed or complied
with by it on or before the Closing Date.
c. GRG shall have delivered to the Shareholders a certificate of its
President or a Vice President and its Secretary or an Assistant
Secretary, dated as of the Closing Date, certifying in such detail as
the Shareholders may reasonably request to the fulfillment of the
conditions specified in this Paragraph 9.
104
d. The Shares of GRG's Common Stock, $.0005 par value, which are to be
issued to the Shareholders on the Closing Date in accordance with the
terms hereof shall have been listed or authorized for listing on the
Exhibit "B".
e. The Board of Directors of GRG shall have taken all necessary action
to authorize the execution and performance of this Agreement, including
the delivery of shares of Common Stock of GRG to the Shareholders in
accordance with this Agreement, and GRG shall have delivered to the
Shareholders true and complete copies certified by its Secretary or
Assistant Secretary, of Resolutions of its Board of Directors
evidencing such action.
f. GRG shall represent to the Shareholders that:
i. GRG is a corporation duly organized, validly existing and
in good standing under the laws of the State of Nevada, with
an authorized capitalization as set forth in subparagraph (b)
of Paragraph 7 of this Agreement, with full corporate power
and authority to enter into and perform its obligations under
this Agreement, to own and hold its properties owned and
leased and to carry on the business in which it is engaged.
ii. The Execution, delivery and performance of this Agreement
by GRG have been duly and validly authorized and approved (as
required by law and by the terms of this Agreement) by GRG's
Board of Directors and this Agreement has been duly executed
and delivered by GRG and constitutes the valid and binding
obligation of GRG in accordance with its terms, except as
limited by bankruptcy, insolvency, and other laws affecting
the enforcement of creditors' rights.
iii. The execution, delivery and performance of this Agreement
and the consummation of the transactions contemplated herein
will not result in any breach or violation of any of the terms
or provisions of, or constitute a default under, the Articles
of Incorporation or By-Laws of GRG or, to the knowledge of
such counsel, any statue, law, order, rule or regulation of
any court of governmental agency or body having jurisdiction
over GRG or any of its activities or properties or, to the
knowledge of such counsel, any term or provision of any
indenture, mortgage, security agreement, or other agreement,
instrument, commitment or arrangement, to which GRG is a party
or by which it is bound or to which its property is subject.
iv. The shares of GRG to be delivered to the Shareholders on
the Closing Date pursuant to Paragraph 2 hereof, have been
duly authorized and upon such delivery will be validly issued,
fully paid, nonassessable and listed or authorized for listing
on the Exhibit "B".
105
g. No action or proceeding by any governmental body or agency shall
have been threatened, asserted or instituted to restrain or prohibit
the carrying out of the transactions contemplated by this Agreement.
h. All corporate and other proceedings and actions taken in connection
with the transactions contemplated hereby and all certificates,
opinions, agreements, instruments and documents mentioned in this
Paragraph 9 or incident to any such transaction shall be satisfactory
in form and substance to the Shareholders and their counsel.
The conditions contained in this Paragraph 9 are included herein for the benefit
of the Shareholders and, without constituting a waiver of any of its rights
hereunder, may be waived, in whole or in part, by the Shareholders.
10. Certain Covenants Prior to Closing.
a. The Shareholders will use their best efforts, and take such other
action as may be necessary, to fulfill all of the conditions contained
in Paragraph 8 hereof and to authorize and consummate, and cause the
Company to authorize and consummate, all of the transactions herein
contemplated.
b. GRG will use its best efforts, and take such other action as may be
necessary, to fulfill all of the conditions contained in Paragraph 9
hereof and to authorize and consummate all of the transactions herein
contemplated.
c. Between the date of this Agreement and the Closing Date, the Company
and Shareholders shall (a) give GRG and its authorized representatives
full access to all offices, warehouses and other facilities and
properties of the Company and to the books and records of the Company
(and permit GRG to make copies thereof), (b) permit GRG to make
inspections thereof, and (c) cause its officers and its advisors
(including, without limitation, its auditors, attorneys, financial
advisors and other consultants, agents and advisors) to furnish GRG
with such financial and operating data and other information with
respect to the business and properties of the Company, and to discuss
with GRG and its authorized representatives the affairs of the Company,
all as GRG may from time to time reasonably request.
d. Between the date of this Agreement and the Closing Date, the Company
and Shareholders shall give notice to GRG promptly upon the Company or
Shareholders becoming aware of (a) any inaccuracy of a representation
or warranty set forth in any schedule or (b) any event or state of
facts that, if it had occurred or existed on or prior to the date of
this Agreement, would have caused any such representation and warranty
to be inaccurate, any such notice to describe such inaccuracy, event or
state of facts in reasonable detail.
106
e. Between the date of this Agreement and the Closing Date, the Company
and Shareholders shall cause (a) copies of all reports and other
documents given to the members of the Board of Directors (or any
committee thereof) of the Company to be delivered to GRG at the same
time and (b) copies of the minutes of all meetings of, and actions
taken without a meeting by, the Board of Directors (or any committee
thereof) of the Company to be delivered to GRG promptly after the
preparation thereof. Between the date of this Agreement and the
Closing, the Company and Shareholders shall give GRG at least three (3)
days prior notice of any meeting of or action to be taken without a
meeting by, the Board of Directors or committee thereof, of the Company
and shall cause the Company to permit one individual designated by GRG
to attend each such meeting as an observer.
f. Between the date of this Agreement and the Closing Date, GRG, the
Company and Shareholders shall discuss and coordinate with respect to
any public filing or announcement concerning any of the contemplated
transactions.
g. GRG and Shareholders shall cause the Company to, (a) file with
applicable regulatory authorities the applications and related
documents required to be filed by them (and prosecute diligently and
related proceedings) in order to consummate the contemplated
transactions and (b) cooperate with the others as they may reasonably
request in connection with the following.
11. Survival of Representations and Warranties; Indemnification.
a. Survival. All representations, warranties and agreements contained
in this Agreement shall survive the Closing notwithstanding any
investigation conducted with respect thereto; however, a party shall
have no liability with respect to a representation and warranty, or an
agreement to be performed or complied with prior to the Closing Date,
to the extent that the inaccuracy of such representation and warranty
or the failure to perform and comply with such agreement was not
intentional and was disclosed in a schedule delivered pursuant to this
Agreement.
b. Indemnification by Company and Shareholders. The Company and
Shareholders, jointly and severally, shall indemnify and hold harmless
GRG, and shall reimburse GRG for any loss, liability, claim, damage,
expense (including, but not limited to, costs of investigation and
defense and reasonable attorneys' fees) or diminution of value
(collectively "Damages") arising from or in connection with, (a) any
inaccuracy in any of the representations and warranties of the Company
or Shareholders in this Agreement, or any actions, omissions or state
of facts inconsistent with any such representation or warranty, (b) any
failure by the Company or Shareholders to perform or comply with any
agreement in this Agreement, (c) any claim by any person for brokerage
or finder's fees or commissions or similar payments based upon any
agreement or understanding alleged to have been made by any such person
with the Company or any Shareholder (or any person acting on their
behalf) in connection with any of the contemplated transactions.
107
c. Indemnification by GRG. GRG shall indemnify and hold harmless the
Company and Shareholders, and shall reimburse the Company and
Shareholders for, any Damages arising from or in connection with (a)
any inaccuracy in any of the representations and warranties of GRG in
this Agreement, or any actions, omissions or state of facts
inconsistent with any such representation or warranty, (b) any failure
by GRG to perform or comply with any agreement in this Agreement, or
(c) any claim by any person for brokerage or finder's fees or
commissions or similar payments based upon any agreement or
understanding alleged to have been made by such person with GRG (or any
person acting on its behalf) in connection with any of the contemplated
transactions without having been discussed by the Company.
d. Procedure for Indemnification. Promptly after receipt by an
indemnified party of notice of the commencement of any action, such
indemnified party shall, if a claim in respect thereof is to be made
against an indemnifying party under such section, give notice to the
indemnifying party of the commencement thereof, but the failure so to
notify the indemnifying party shall not relieve it of any liability
that it may have to any indemnified party except to the extent the
indemnifying party demonstrates that the defense of such action is
prejudiced thereby. In case any such action shall be brought against an
indemnified party and it shall give notice to the indemnifying party of
the commencement thereof, the indemnifying party shall be entitled to
participate therein and, to the extent that it shall wish, to assume
the defense thereof with counsel satisfactory to such indemnified party
and, after notice from the indemnifying party to such indemnified party
of its election so to assume the defense thereof, the indemnifying
party under such section for any fees of other counsel or any other
expenses, in each case subsequently incurred by such indemnified party
in connection with the defense thereof, other than reasonable costs of
investigation. If an indemnifying party assumes the defense of such an
action, (a) no compromise or settlement thereof may be effected by the
indemnifying party without the indemnified party's consent, which shall
not be unreasonably withheld unless (i) there is no finding or
admission of any violation of law or any violation of the rights of any
person and no effect on any other claims that may be made against the
indemnified party and (b) the indemnifying party shall have no
liability with respect to any compromise or settlement thereof effected
without its consent, which shall not be unreasonably withheld. If
notice is given to an indemnifying party of the commencement of any
action and it does not, within ten (10) days after indemnified party's
notice is given, give notice to the indemnified party of its election
to assume the defense thereof, the indemnifying party shall be bound by
any determination made in such action or any compromise or settlement
thereof effected by the indemnified party. Notwithstanding the
foregoing, if an indemnified party determines in good faith that there
is a reasonable probability that an action may adversely affect it
other than as a result of monetary damages, such indemnified party may,
by notice to the indemnifying party, assume the exclusive right to
defend, compromise or settle such action, but the indemnifying party
shall not be bound by any determination of an action so defended or any
compromise or settlement thereof effected without its consent, which
shall not be unreasonably withheld.
108
e. After-Tax Basis. In determining the Damages suffered by any person,
the amount thereof shall be reduced by any tax benefit realized by such
person as a result of the incurrence of such Damages. Any payment
required by this Paragraph 11 (for indemnification or otherwise) in
respect of the Damages suffered by any person shall be in an amount
that after deducting any tax cost incurred by the person receiving that
payment equal the amount required to be paid as determined under the
applicable provisions (other than this sentence) of this Paragraph 11.
The tax benefit realized by a person by reason of any payment or other
matter shall be the amount by which (a) the aggregate federal and state
income and franchise taxes that would have been, but for such payment
or other matter, payable by such person for the fiscal year, if any, in
which such payment or other matter is taken into account ("but-for
tax") exceeds (b) the aggregate federal and state income and franchise
taxes actually payable by such person for such fiscal year ("actual
tax") and the tax cost of any payment shall be the amount by which the
actual tax exceeds but-for tax.
f. Notwithstanding anything hereinabove contained to the contrary in
Paragraph 11, (i) none of the provisions of this Paragraph 11 shall
apply to any liability (whether by GRG to one or more of the
Shareholders or by one or more the Shareholders to GRG) arising out of
or by virtue of the Provisions of Paragraph 12 below or any violation
of the provisions of Paragraph 12, and (ii) the provisions of said
Paragraph 12 shall survive the Closing Date.
12. Investment Representation. Each of the Shareholders acknowledges his
understanding that the shares of GRG's Common Stock to be delivered to the
Shareholders pursuant to this Agreement will not be registered pursuant to the
1933 Act and each of the Shareholders further represents to and agrees with GRG
as follows:
a. He/she is acquiring the shares of GRG's Common Stock pursuant to
this Agreement for his/her own private personal investment account and
with no present intention of reselling or distributing such shares or
any portion thereof to others.
b. They fully comprehend that in connection with the issuance of shares
of GRG's Common Stock pursuant to this Agreement, GRG is relying to a
material degree on the representations, warranties and covenants
contained herein, and with such realization he/she authorizes GRG to
act as it may see fit in full reliance hereon.
c. He/she agrees that none of such shares will be transferred or
distributed unless (i) they are covered by an effective Registration
Statement prepared in accordance with the 1933 Act and are distributed
in a manner complying with the 1933 Act and with the Rules and
Regulations promulgated thereunder; or (ii) they may be transferred in
accordance with Rule 144 of the Rules and Regulations
109
pursuant to the 1933 Act (or such similar Rule as may be applicable to
such shares at the time of transfer) so long as such transfer strictly
complies with said Rule 144 and with such procedures as GRG may
reasonably establish in connection therewith; or (iii) there is first
delivered to GRG the written legal opinion of legal counsel in form and
substance reasonably satisfactory to GRG's legal counsel or a "no
action letter" from SEC indicating that any of the provisions of the
1933 Act and the Rules and Regulations promulgated thereunder. In the
event such legal opinion is based upon the exemption now contained in
Section 4(2) of the 1933 Act, the person acquiring shares or some
portion thereof shall execute and deliver to GRG a letter agreement
complying with the 1933 Act and the Rules and Regulations promulgated
thereunder.
d. He/she hereby agrees that the certificate(s) representing such
shares may bear a legend, as set forth below, setting forth the
restrictions upon transfer which are contained in the foregoing
subparagraph (c) and that GRG may deliver to its transfer agents a
"stop transfer order" directing the transfer agents not to effect any
transfer of such shares without having received the permission of GRG
and evidence of compliance with applicable provisions of the 1933 Act
and the terms of this Agreement.
The shares represented by this certificate have not been
registered under the Securities Act of 1933 (the "Act") and
are "restricted securities" as that term is defined in Rule
144 under the Act. The shares may not be offered for sale,
sold or otherwise transferred except pursuant to an exemption
from registration under the Act, the availability of which is
to be established to the satisfaction of GRG.
e. He/she hereby agrees that to indemnify GRG against and hold it
harmless from all losses, liabilities, costs and expenses (including
reasonable attorneys' fees) which shall arise as a result of a sale or
distribution by him of such shares or any portion thereof in violation
of the 1933 Act or the terms of this Agreement.
13. Further Assurances.
a. At the request of GRG, and without further consideration, the
Company and Shareholders will execute and deliver such additional
instruments of transfer and will take such other action as GRG
reasonably may request in order more effectively to transfer to GRG
full ownership and control of the Company.
b. At the request of one or more of the Shareholders, and without
further consideration, GRG will execute and deliver such additional
instruments and will take such other actions as Shareholders may
reasonably request in order more effectively to carry out the
transaction contemplated hereby.
110
14.Expenses. Each party shall bear its own expenses incident to the preparation,
negotiation and delivery of this Agreement and the performance of its
obligations hereunder.
15. Partial Liquidation. Supplemental to this Agreement, the Company agrees to
dividend out, on a basis acceptable to it without any approval on GRG's part,
any or all of the GRG shares it receives to its Shareholders as a non-taxable
partial liquidation. Upon such dividend, the Company agrees to non longer
aggregate international long distance traffic for three (3) years.
16. Directors. All Directors of the Company whose resignations shall have been
requested by GRG not less than five (5) days before the Closing Date shall have
submitted their resignations or been removed effective as of the Closing Date.
One (1) seat on the Board of Directors will be available for the Company.
17. Other Matters.
a. No Other Agreements. All terms and conditions of this Agreement are
set forth herein, and there are no warranties, agreements or
understandings, express or implied, except those expressly set forth
herein.
b. Amendment. This Agreement may be amended only by a written
instrument executed on behalf of GRG, the Company and the Shareholders;
provided, however, that after the Closing provided for herein, GRG and
the Shareholders may amend this Agreement without the execution or
approval of the Company.
c. Notices. Any notice or other communication required or permitted to
be given hereunder shall be deemed properly given if personally
delivered or deposited in the United States mail, registered or
certified and postage prepaid, addressed to the Company or the
Shareholders at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇▇▇▇, or at such other addresses as may from time to time be
designated by the respective parties in writing.
d. Specific Performance. The parties acknowledge that the subject
matter of this Agreement (i.e., the business and assets of the Company)
is unique and that no adequate remedy of law would be available for
breach of this Agreement. Accordingly, each party agrees that the other
parties will be entitled to an appropriate decree of specific
performance or other equitable remedies to enforce this Agreement
(without any bond or other security being required) and each party
waives the defense in any action or proceeding brought to enforce this
Agreement that there exists an adequate remedy at law.
111
e. Assignment. Except as specifically permitted by the terms of this
Agreement, neither this Agreement nor any right created hereby shall be
assignable by GRG. The Company or the Shareholders (or their respective
successors in interest) without the prior written consent of all other
parties hereto, and any such attempted assignment shall be void.
Nothing in this agreement, expressed or implied, is intended to convert
upon any person, other than the parties hereto, any rights or remedies
under or by reason of this Agreement. Notwithstanding any other
provisions herein to the contrary, the right of each of the
Shareholders to receive shares of GRG's Common Stock pursuant to
Paragraph 2 hereof shall not be assignable except upon the death of
such Shareholder by testamentary disposition or the law of intestate
succession.
f. Paragraphs and Other Headings. Paragraphs or other headings
contained in this Agreement are for reference purposes only and shall
not affect in any way the meaning or interpretation of this Agreement.
g. Choice of Law. It is the intention of the parties that the laws of
the State of Florida should govern the validity of this Agreement, the
construction of its terms and the interpretation of the rights and
duties of the parties.
h. No Waiver. The failure of any party to insist upon strict adherence
to any term of this Agreement on any occasion shall not be considered a
waiver or deprive that party of the right thereafter to insist upon
strict adherence to that term or any other term of this Agreement. Any
waiver must be in writing.
i. Severability. In the event that any one or more of the provisions
contained in this Agreement shall for any reason be held to be invalid,
illegal or unenforceable, the same shall not affect any other
provisions of this Agreement, but this Agreement shall be construed as
if such invalid, illegal or unenforceable provisions had never been
contained herein.
j. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all shall
constitute one and the same instrument.
k. Non-Competition Agreement. The Company agrees to the
following terms governing the confidentiality of any and all
confidential information it has obtained from GRG and/or has provided
to GRG:
112
1. Definitions. For purposes of this Non-Competition
Agreement, "Confidential Information" means all information of GRG or another
party whose information GRG has in its possession under obligations of
confidentiality, in whatever form transmitted, relating to business plans,
operations, systems and/or the proposed sale, purchase and use of services which
(i) is disclosed by GRG or its affiliates to Recipient or its affiliates,
indicating its confidential or proprietary nature or obviously confidential or
proprietary by its nature, or (ii) is developed during the relationship between
the parties and would give or increase the advantage of GRG's competitors over
GRG or diminish GRG's advantage over its competitors. The term "affiliate" shall
mean any person or entity controlling, controlled by or under common control
with a party.
Confidential Information shall not include any information of GRG that: (i) is
already known to the Company at time of its disclosure; (ii) is or becomes
publicly known through no wrongful act of the Company; (iii) is communicated to
a third party with express written consent of GRG; (iv) is independently
developed by the Company ; or (v) is lawfully required to be disclosed, provided
that, before making such disclosure, the Company shall immediately give GRG
written notice and cooperate in GRG's actions to assure confidential handling of
such information.
2. Ownership. All Confidential Information in whatever form
(including without limitation, information in computer software or held in
electronic storage media) shall be and remain property of GRG. All such
Confidential Information shall be returned to GRG promptly upon written request
and shall not be retained in any form by the Company.
3. Term. For a period of three (3) years from the date of
disclosure, the Company shall not disclose any Confidential Information to any
person or entity except employees of the Company and its affiliates who have a
need to know and who have been informed of the Company's obligations under this
Confidentiality Agreement. The Company shall use not less than the same degree
of care to avoid disclosure of Confidential Information as the Company uses for
its own confidential information of like importance and, at a minimum, shall
exercise reasonable care. Either party may terminate this Confidentiality
Agreement by written notice to the other. However, all rights and obligations
under this Agreement shall survive with respect to Confidential Information
disclosed prior to termination.
4. Remedies. The parties agree that, in the event of a breach
or threatened breach of the terms of this Confidentiality Agreement, GRG shall
be entitled to an injunction in addition to and not in lieu of any other legal
or equitable relief including monetary damages. The parties acknowledge that
Confidential Information is valuable and unique and that disclosure will result
in irreparable injury to ▇▇▇.
▇▇▇
▇. Disclaimer. This Agreement and the disclosure and receipt
of Confidential Information do not create or imply (i) any agreement with
respect to the sale, purchase or pricing of any product or service; or (ii) any
right conferred, by license or otherwise, in any Confidential Information or in
any patent, trademark, service ▇▇▇▇, copyright or other intellectual property.
18. Settlement of the Company's Debentures. The Company agrees to settle or
release GRG from all of its liabilities, including debentures in accordance with
the plan indicated in Exhibit "B".
19. The Company's Dividends. Pursuant to this plan, the Company agrees to
dividend its Shareholders as a partial liquidation in a manner prescribed by the
Company's Board of Directors. The Company shall hold, indemnify and hold GRG
harmless with respect to this distribution.
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement as of the day and year first above written.
GLOBAL RESOURCES GROUP, INC.
-------------------------------------
▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
President/Chief Executive Officer
INTERNATIONAL TELEDATA CORPORATION
-------------------------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Chairman
GRGL06.2
114
EXHIBIT "A"
Assets
Contracts and Leads Sold
and
Assets Excluded
The assets sold comprise of a group of contracts and potential
contracts, and any manpower used to bring such contracts to maturity,
originating in 1998 which are as follows; all operating assets relating to these
assets, and are associated with the aggregation of international long distance
traffic.
CFC Contract
PointCom Carrier Relationship
PointCom Customer Relationship
CRC Contract
AT&T Carrier Relationship
Contract in China known as, Shenzen Agreement, China II,
and Related Modifications
Telex Contract
Ameritech Relationship
Qwest
Smart Talk
Intelect
JMR
PacAmtel
I.C.E. / Caricom
Orion / ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & related companies
AATA
Coyote
Prinvest
RC&A
Rhinos
AIT / Interoute
Fusion
SCI / ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Sprint
MCIWorldcom
Realtime Media
Teleprizes and any and all associated contacts
MCG / 5OO to 1 Compression
G.D.C.
115
EXHIBIT "A"
(Continued)
Assets
Contracts and Leads Sold
and
Assets Excluded
Nations ▇▇▇▇
Quest
NexCom
SDS
VitalNetworks
ComLink
Any and all agents of GRG, Inc.
Any and all Non-Disclosures, Confidentiality and Non-Circumvention Agreements
The assets excluded consist entirely of the assets of the SAS relationship,
contracts, rights, receivables and/or settlements associated with the Company's
long distance business assets of the like, with the exception of the monies
advanced to China One (1) which are part of AATA Agreement.
The Company is held harmless from any potential violations of the non-compete
clauses associated with the activation of SAS.
116
EXHIBIT "B"
Settlement of Liabilities
The Company agrees to execute settlements for its May 31, 1999 convertible
debentures in the following manner:
From the Company's pool of shares, the Company agrees to issue up to 203,840 *
GRG shares to the convertible debenture holders on December 31, 1998. GRG agrees
to issue any additional shares as of the settlement date to cover any shortfall
to such parties in the event that the value of the stock issued using the bid
price at the settlement date if less than the debenture amount below.
* To be released in the following names
Debenture Amount Names Settlement Date No. of Shares
$24,000.00 ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇. April 1, 2000 13,440
$20,000.00 ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ April 1, 2000 11,200
$10,000.00 ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ April 1, 2000 5,600
$10,000.00 ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ April 1, 2000 5,600
$100,000.00 ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇, ▇▇. May 31, 1999 56,000
$50,000.00 ▇▇▇▇▇▇▇ ▇▇▇▇▇ May 31, 1999 28,000
$50,000.00 ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ May 31, 1999 28,000
$100,000.00 ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇. May 31, 1999 56,000
117
EXHIBIT "C"
Modifications
To facilitate the final settlement of the Company's Convertible Debenture
Holders, it is hereby agreed that GRG will issue 105,840 shares to the Debenture
Holders. The Company shall negotiate, on GRG's behalf, the successful return in
a manner acceptable to GRG of 200,000 free trading GRG shares held by SAS, Inc.,
or agree to return 200,000 shares to the treasury of GRG in the event of failure
to negotiate the successful return of such shares.
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▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
President/Chief Executive Officer Chairman
Global Resources Group, Inc. International TeleData Corporation
118
EXHIBIT "D"
International TeleData Corporation hereby assigns, grants and transfers
all rights it has obtained under noncircumvention and noncompetition agreements
to Global Resources Group, Inc.
GRG, Inc. agrees to issue up to 200,000 shares of its common stock as
settlement for any obligations due to ▇▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ associated with
employment contracts or promised employment contracts between ▇▇. ▇▇▇▇▇▇▇▇▇ and
International TeleData Corporation and/or GRG, Inc. International TeleData
Corporation agrees to use its good offices to settle all matters with ▇▇.
▇▇▇▇▇▇▇▇▇ with the understanding that in 1999 the management of GRG, Inc. can
negotiate arrangements with ▇▇. ▇▇▇▇▇▇▇▇▇ for future services without further
reference to any past arrangements.
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▇▇▇▇▇▇ ▇▇▇▇▇▇▇, Chairman O. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇, Chairman
International TeleData Corporation Global Resources Group, Inc.
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▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, Individually
119
