CONFORMED COPY
STOCK PURCHASE AGREEMENT
Dated September 11, 1995
By and Among
Spectrum Information Technologies, Inc.,
The Xxxx Corporation,
Comforce Corp.,
ARTRA Group Incorporated,
Xxxxx X. Xxxxxx,
Xxxx X. Xxxxxx,
Xxxxx X. Xxxxxxx,
Xxxxxxx Xxxxxxxxxx,
and
Xxxxxxxxxxx X. Xxxxxx
TABLE OF CONTENTS
I. DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . .1
1.1 Certain Definitions . . . . . . . . . . . . . . . . . .1
1.2 Certain Terms . . . . . . . . . . . . . . . . . . . . .6
II. PURCHASE AND SALE OF STOCK . . . . . . . . . . . . . . . . .6
2.1 Purchase and Sale . . . . . . . . . . . . . . . . . . .6
2.2 Deposit and Guarantee . . . . . . . . . . . . . . . . .6
2.3 Purchase Price. . . . . . . . . . . . . . . . . . . . .7
2.4 Closing Date. . . . . . . . . . . . . . . . . . . . . .7
2.5 Delivery and Payment. . . . . . . . . . . . . . . . . .7
III. REPRESENTATIONS AND WARRANTIES OF SELLER. . . . . . . . . .8
IV. REPRESENTATIONS AND WARRANTIES OF THE PURCHASING GROUP . . 12
V. COVENANTS AND AGREEMENTS BY SELLER. . . . . . . . . . . . . 14
5.1 Conduct of Business . . . . . . . . . . . . . . . . . 14
5.2 Bankruptcy Court Approval Order . . . . . . . . . . . 16
5.3 Further Assurances. . . . . . . . . . . . . . . . . . 16
VI. COVENANTS AND AGREEMENTS BY THE PURCHASING GROUP . . . . . 16
6.1 Further Assurances. . . . . . . . . . . . . . . . . . 16
6.2 Use of Spectrum Name. . . . . . . . . . . . . . . . . 17
6.3 Pre-Closing Confidentiality . . . . . . . . . . . . . 17
6.4 Post-Closing Confidentiality. . . . . . . . . . . . . 18
6.5 Assumption of Certain Compensation Expenses . . . . . 18
VII. ADDITIONAL COVENANTS AND AGREEMENTS BY THE MANAGERS
AND FRANCO. . . . . . . . . . . . . . . . . . . . . . . . 18
7.1 Further Assurances . . . . . . . . . . . . . . . . . 18
VIII. SELLER'S CONDITIONS TO CLOSING . . . . . . . . . . . . . 19
IX. PURCHASER'S CONDITIONS TO CLOSING. . . . . . . . . . . . . 20
X. TERMINATION . . . . . . . . . . . . . . . . . . . . . . . . 22
10.1 Termination. . . . . . . . . . . . . . . . . . . . . 22
10.2 Effect of Termination. . . . . . . . . . . . . . . . 22
XI. RELEASES, INDEMNIFICATION AND SURVIVAL OF REPRESENTATIONS. 24
11.1 Releases . . . . . . . . . . . . . . . . . . . . . . 24
11.2 Indemnification by Seller. . . . . . . . . . . . . . 24
11.3 Indemnification by Purchaser and Xxxx. . . . . . . . 24
11.4 Indemnification by Xxxxxxx and Xxxxxxxxxx. . . . . . 24
11.5 Indemnification by Guarantors. . . . . . . . . . . . 25
11.6 [Intentionally Omitted]. . . . . . . . . . . . . . . 25
11.7 Indemnification Procedures . . . . . . . . . . . . . 25
11.7.1 Notice of Asserted Liability . . . . . . . . . . . 25
11.7.2 Defense of Asserted Liability. . . . . . . . . . . 25
11.8 Termination of Indemnification Obligations . . . . . 26
XII. MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . 27
12.1 Expenses . . . . . . . . . . . . . . . . . . . . . . 27
12.2 Role of the Managers and Franco in Negotiations. . . 27
12.3 Non-Competition Agreement. . . . . . . . . . . . . . 27
12.4 Governing Law. . . . . . . . . . . . . . . . . . . . 28
12.5 Jurisdiction . . . . . . . . . . . . . . . . . . . . 28
12.6 Captions . . . . . . . . . . . . . . . . . . . . . . 28
12.7 Notices. . . . . . . . . . . . . . . . . . . . . . . 28
12.8 Parties in Interest. . . . . . . . . . . . . . . . . 30
12.9 Severability . . . . . . . . . . . . . . . . . . . . 30
12.10 Counterparts. . . . . . . . . . . . . . . . . . . . 30
12.11 Entire Agreement. . . . . . . . . . . . . . . . . . 30
12.12 Amendments. . . . . . . . . . . . . . . . . . . . . 30
12.13 Third Party Beneficiaries . . . . . . . . . . . . . 31
12.14 Gender. . . . . . . . . . . . . . . . . . . . . . . 31
12.15 Protection of the Value of the Company. . . . . . . 31
12.16 Cooperation - Tax Matters . . . . . . . . . . . . . 31
XIII. BANKRUPTCY COURT APPROVALS AND PROCEDURES. . . . . . . . 31
13.1 Sale Order . . . . . . . . . . . . . . . . . . . . . 31
13.2 [Intentionally Omitted]. . . . . . . . . . . . . . . 32
13.3 Notice . . . . . . . . . . . . . . . . . . . . . . . 32
13.4 Competing Bid . . . . . . . . . . . . . . . . . . . 32
13.5 Competing Bidders. . . . . . . . . . . . . . . . . . 32
EXHIBITS
Exhibit A Form of Escrow Agreement
Exhibit B Form of Guarantee of Xxxxx X. Xxxxxx
Exhibit C Form of Guarantee of Xxxx X. Xxxxxx
Exhibit D [INTENTIONALLY OMITTED]
Exhibit E Form of Guarantee of The Xxxx Corporation
Exhibit F Form of Guarantee of ARTRA Group Incorporated
Exhibit G [INTENTIONALLY OMITTED]
Exhibit H Form of Certification that an Entity Transferor
is Not a Foreign Person
Exhibit I Form of General Release and Waiver of Xxxxxx X. Xxxxxxx
Exhibit J Form of General Release and Waiver of Gordian
Group, L.P.
Exhibit K Form of Mutual Release and Waiver Between Spectrum
Global Services, Inc. and Xxxxxx X. Xxxxxxx
Exhibit L [INTENTIONALLY OMITTED]
Exhibit M Form of Mutual Release Between Spectrum Information
Technologies Inc. and Xxxxx X. Xxxxxxx
Exhibit N Form of Mutual Release Between Spectrum Information
Technologies, Inc. and Xxxxxxx Xxxxxxxxxx
Exhibit O Form of Mutual Release Between Spectrum Information
Technologies, Inc. and Xxxxxxxxxxx X. Xxxxxx
Exhibit P Form of Manager Escrow Agreement
Exhibit Q Form of Non-Competition Agreement
Exhibit R Form of Confidentiality Agreement
STOCK PURCHASE AGREEMENT
STOCK PURCHASE AGREEMENT dated September 11, 1995 by
and among SPECTRUM INFORMATION TECHNOLOGIES, INC., a corporation
organized under the laws of the State of Delaware ("Seller") and
THE XXXX CORPORATION, a corporation organized under the laws of
the State of Delaware ("Xxxx"), COMFORCE CORP., a corporation
organized under the laws of the State of Delaware ("Purchaser"),
ARTRA GROUP INCORPORATED, a corporation organized under the laws
of the State of Pennsylvania ("ARTRA"), XXXXX X. XXXXXX
("Xxxxxx"), XXXX X. XXXXXX ("Xxxxxx"), XXXXX X. XXXXXXX
("Xxxxxxx"), XXXXXXX XXXXXXXXXX ("Xxxxxxxxxx"), and XXXXXXXXXXX
X. XXXXXX ("Franco").
W I T N E S S E T H :
WHEREAS, Seller owns 100 shares of common stock, $0.01
par value, being all of the issued and outstanding shares of
capital stock (the "Stock") of SPECTRUM GLOBAL SERVICES, INC.
d/b/a YIELD GLOBAL (the "Company"), and the Company owns 100
shares of common stock, $0.01 par value, being all of the issued
and outstanding shares of capital stock of SUMTEC CORPORATION
("Sumtec"), each a corporation organized under the laws of the
State of Delaware; and
WHEREAS, on January 26, 1995 Seller commenced case
no.195 1069 0260 under chapter 11 of title 11 of the United
States Bankruptcy Code, 11 U.S.C. Sections 101 et. seq. (the
"Bankruptcy Code" and the "Chapter 11 Case"), in the United
States Bankruptcy Court for the Eastern District of New York (the
"Bankruptcy Court"); and
WHEREAS, Seller desires to sell and transfer to
Purchaser, and Purchaser desires to purchase and accept from
Seller, 100 percent of the Stock pursuant to the terms of this
Agreement (as defined below);
NOW, THEREFORE, in consideration of the mutual
covenants and agreements of the parties contained herein, the
parties hereby agree as follows:
ARTICLE I
DEFINITIONS
Section 1.1 Certain Definitions. In addition to the
terms defined throughout this Agreement (as defined below), the
following terms shall have the following meanings (such meanings
to be equally applicable to the singular and plural forms
thereof):
"Affiliate" means any other Person which, directly or
indirectly, controls or is controlled by or is under common
control with such Person and, without limiting the generality of
the foregoing, includes (i) any Person which beneficially owns or
holds 25% or more of any class of voting securities of such
Person or 25% or more of the equity interest in such Person, (ii)
any Person of which such Person beneficially owns or holds 25% or
more of any class of voting securities or in which such Person
beneficially owns or holds 25% or more of the equity interest in
such Person and (iii) any director, officer or employee of such
Person. For the purposes of this definition, the term "control"
(including, with correlative meanings, the terms "controlled by"
and "under common control with"), as used with respect to any
Person, means the possession, directly or indirectly, of the
power to direct or cause the direction of the management and
policies of such Person, whether through the ownership of voting
securities or by contract or otherwise.
"Agreement" means this Agreement together with all
exhibits, schedules, supplements and documents as may be attached
hereto or incorporated herein by reference.
"Asserted Liability" has the meaning ascribed thereto in
Section 11.7.1.
"Audited Statements" has the meaning ascribed thereto in
Section 3.5.
"Bankruptcy Code" has the meaning ascribed thereto in the
Recitals.
"Bankruptcy Court" has the meaning ascribed thereto in the
Recitals.
"Bankruptcy Court Approval Order" means an order by the
Bankruptcy Court for the Eastern District of New York approving
this Agreement and the transactions contemplated hereunder
pursuant to Sections 105, 363, 365 of the Bankruptcy Code, and
including, without limitation, a decretal paragraph pursuant to
Section 363(f) of the Bankruptcy Code that the Stock shall be
sold to Purchaser free and clear of any interest, rights or
options and/or any liens, claims, encumbrances of any kind in
such Stock of any Person whatsoever.
"Business" means the business of the Company, as it is
presently conducted by the Company, of providing, on a temporary,
project or peak period basis, personnel (a) who are qualified
designers, drafters, engineers, computer programmers, systems
analysts, technicians and/or other skilled personnel and (b) who
under the direct supervision and control of a particular client
(or under the direct supervision and control of any such
personnel who is under the direct supervision and control of a
particular client) provide technical and consulting services to
industrial, commercial, communications and governmental customers
and clients in the areas of computer programming, information
technology, design, drafting, engineering, telecommunications,
wireless, transmission, switching, CATV systems, OSP and
construction, premises network and data services, support
services, systems analysis, technical publications, consulting
and technical staff augmentation services.
"Chapter 11 Case" has the meaning ascribed thereto in the
Recitals.
"Claims Notice" has the meaning ascribed thereto in Section
11.7.1.
"Closing" means the consummation of the transaction
described herein including the execution and delivery of all
Property in Seller's possession as described in Section
2.5(b)(iii), funds, documents, certificates, resolutions,
assignments and opinions contemplated in this Agreement.
"Closing Adjustment" means the adjustment, if any, made at
Closing to the Closing Payment to reflect the amount (i) by which
the cash of the Company has been reduced as a result of the
payment of cash dividends pursuant to Section 5.1(b)(i); (ii) by
which Seller shall be reimbursed by the Purchaser for any amounts
of salary, expenses, benefits or other compensation actually paid
on or after July 1, 1995 by Seller to each of the Managers and
Franco pursuant to Section 6.5; (iii) by which the Purchaser
shall be reimbursed by the Seller for any amounts of salary,
expenses, benefits or other compensation actually paid on or
after July 1, 1995 to Xxxxxx X. Xxxxxxx, Xxx Xxxxxxxxxxx and
Xxxxxx X. Xxxxxx; and (iv) of the increase in the Closing Payment
equal to one-half of the intercompany payables reflected on
Schedule 1.1 - Closing Adjustment effective as of the Closing.
Schedule 1.1 - Closing Adjustment shall set forth the amount of
such adjustment as of the date hereof, which shall be updated by
mutual consent of Purchaser and Seller to reflect the amount of
such adjustment effective as of the Closing. If Purchaser and
Seller shall be unable to agree on the amount of the Closing
Adjustment, then such amount shall be determined by an accounting
firm jointly selected by Seller and Purchaser, which
determination shall be final and binding. If Purchaser and
Seller cannot agree upon the selection of an accounting firm,
then each of Seller and Purchaser shall choose an accounting firm
and such accounting firms shall jointly choose an accounting firm
to determine the Closing Adjustment, the choice of which shall be
binding upon each of Purchaser and Seller. The costs of
obtaining such determination shall be shared equally by Seller
and Purchaser.
"Closing Date" means the established time for Closing,
which shall be prior to any termination of this Agreement
pursuant to Section 10.1 or Section 10.3 and shall mean the later
of (a) immediately upon the Bankruptcy Court Approval Order or
(b) such other time as shall be agreed upon by Purchaser and
Seller.
"Closing Payment" has the meaning ascribed thereto in
Section 2.3(a).
"Company" has the meaning ascribed thereto in the Recitals.
"Competing Bid" has the meaning ascribed thereto in Section
13.4.
"Competing Bidder" has the meaning ascribed thereto in
Section 13.4.
"Confidentiality Agreement" has the meaning ascribed thereto
in Section 13.5.
"Deposit" means the payment of Five Hundred Thousand
Dollars ($ 500,000) in cash made by Purchaser to Seller on the
date hereof pursuant to Section 2.2(a).
"Dollars or $" means the currency of the United States of
America.
"Escrow Agent" means Cleary, Gottlieb, Xxxxx & Xxxxxxxx.
"Escrow Agreement" has the meaning ascribed thereto in
Section 2.2(b).
"Xxxxxxxxxx" has the meaning ascribed thereto in the
Preamble.
"Franco" has the meaning ascribed thereto in the Preamble.
"GAAP" means United States generally accepted accounting
principles as in effect at the date of Closing.
"Guarantees" means the guarantees made for the benefit of
Seller (substantially in the form of Exhibits B, C, D, E and F
hereto) and delivered on the date hereof by Xxxxxx, Xxxxxx, Xxxx,
and XXXXX pursuant to Section 2.2(c).
"Guarantors" means Xxxxxx, Xxxxxx, Xxxx and XXXXX.
"Xxxxxx" has the meaning ascribed thereto in the Preamble.
"Indemnified Party" means the party who has made a claim
for indemnification.
"Indemnifying Party" means the party against whom a claim
for indemnification is made.
"Xxxx" has the meaning ascribed thereto in the Preamble.
"Manager or Managers" means, individually, Xxxxxxx or
Xxxxxxxxxx or, collectively, Xxxxxxx and Xxxxxxxxxx, as the
context requires.
"Manager Escrow Agreement" has the meaning ascribed thereto
in Section 11.4(b).
"Xxxxxxx" has the meaning ascribed thereto in the Preamble.
"Person" means an individual, a corporation, a limited
liability company, a partnership, an association, a business
trust or any other entity or organization, including a government
or political subdivision or an agency or instrumentality thereof.
"Property" means all of the following assets of the Company
to the extent the same are owned and utilized by Company in
connection with the operation of the Business as of the date
hereof:
(a) "General Intangibles" - (i) the right to use the
names "YIELD TechniGlobal", "Yield Global", "Sumtec", and (ii)
any similar names, and the right to utilize any and all of the
following associated with, arising out of, relating to or
utilized, as of the date hereof, in connection with the Business:
(A) any and all trade names, trademarks, copyrights, service
marks, logos and slogans (including, without limitation, all
registrations, filings and certificates and the sole and
exclusive rights to file and/or prosecute any such registrations,
filings and certificates); (B) proprietary information and know-
how developed in the Business and owned by the Company; and (C)
software owned by the Company; provided, however, that the term
"General Intangibles" shall not include the names "Spectrum
Global Services, Inc." or "Spectrum" or any similar name, and,
except as provided in Section 6.2, the Company or its Affiliates
shall not use or have the right to use "Spectrum Global Services,
Inc." or "Spectrum" or any similar name and shall not utilize any
of the foregoing in association with the name of "Spectrum Global
Services, Inc." or "Spectrum";
(b) "Customer Materials" - any and all agreements,
orders, requirements and inquiries relating to the operation of
the Business from or with the Company's customers (present or
past) or prospective customers;
(c) "Records" - the originals or copies of those
business or financial records of the Company, evidencing the
Customer Materials, Resumes, General Intangibles, Equipment or
relating to Company employees;
(d) "Equipment" - all of the furniture and equipment
owned and utilized by the Company in connection with the
operation of the Business;
(e) "Other Assets" - all of the office supplies,
stock, paper, computer software, and other tangible personal
property owned and used by the Company in connection with the
operation of the Business;
(f) "Accounts Receivable" - means all accounts
receivable of the Company, whether billed or unbilled, as they
exist in the financial books and records of the Company;
provided, however, that in no event shall any include any
intercompany receivable due to the Company from Seller or its
Affiliates be deemed an account receivable;
(g) "Resumes" - all information for or with respect to
current or former or prospective employees or candidates in
whatever medium that it be currently manifested, depicted, stored
or presented including, but not limited to, paper, hardcopy,
computer disks, tapes and databases of the Company, whose
services are or have been provided or may be provided to the
Company's customers prior to the date hereof; and
(h) "Real Property" - those leasehold interests
described on Schedule 1.1 - Real Property.
"Purchase Price" has the meaning ascribed thereto in
Section 2.3.
"Purchaser" has the meaning ascribed thereto in the
Preamble.
"Purchasing Group" means Xxxx, Purchaser, ARTRA, Harvey,
Werner, the Managers and Franco.
"Release" means the mutual releases entered into between
Seller and each of Xxxxxxx, Xxxxxxxxxx and Xxxxxx, dated the
Closing Date, substantially in the forms of Exhibits M, N, and O
hereto, respectively.
"Seller" has the meaning ascribed thereto in the Preamble.
"Stock" has the meaning ascribed thereto in the Recitals.
"Systems Integration" means consulting services and systems
integration relating to the systems analysis, design, support,
development and/or implementation of solutions to clients in the
fields of telecommunications, computing and information
technology, including the providing of services on a contract
labor basis for the purposes of performing the services listed
above but only to the extent such services are directly related
to the project, engagement, system or solution for which Seller's
Systems Integration business was retained by the client.
"To the knowledge of Seller" means to the actual knowledge
of the officers of Seller, other than Franco, as set forth in the
most recent Securities and Exchange Commission Form 10-K.
"Xxxxxx" has the meaning ascribed thereto in the Preamble.
Section 1.2 Certain Terms. All references to Articles
and Sections herein are to the Articles and Sections of this
Agreement unless otherwise specified.
ARTICLE II
PURCHASE AND SALE OF STOCK
Section 2.1 Purchase and Sale. Subject to the terms and
conditions herein stated, and pursuant to Sections 105, 363 and
365 of the Bankruptcy Code, Seller agrees to sell and transfer to
Purchaser on the Closing Date, and Purchaser agrees to purchase
and accept from Seller on the Closing Date, the Stock.
Section 2.2 Deposit and Guarantee.
(a) On the date hereof, Purchaser shall deliver to the
Escrow Agent on behalf of Seller the Deposit of Five Hundred
Thousand Dollars ($ 500,000) in cash, to be held in escrow
pursuant to Section 2.2(b) below, which Deposit shall be
refundable to Purchaser only under the circumstances provided in
Section 10.2(b).
(b) The Deposit shall be held in escrow and disposed
of pursuant to the terms of an escrow agreement of even date
herewith ( the "Escrow Agreement") among Seller, Purchaser and
the Escrow Agent substantially in the form of Exhibit A hereto.
(c) On the date hereof, Xxxxxx, Xxxxxx, Xxxx and XXXXX
shall deliver to Seller the Guarantees accompanied by financial
statements for a period ending no earlier than a date which is
four (4) months prior to the date hereof. For purposes of this
Agreement, Seller acknowledges Xxxxxx'x letter setting forth his
net worth constitutes his financial statements.
Section 2.3 Purchase Price.
(a) The aggregate Purchase Price for the Stock is Six
Million Dollars ($6,000,000), which amount is comprised of (i)
the Deposit (as described in Section 2.2) and (ii) the closing
payment of Five Million Five Hundred Thousand Dollars ($
5,500,000) which shall be payable on the Closing Date in
immediately available funds by federal funds check or certified
check or bank wire to an account designated by Seller (the
"Closing Payment") and which shall be subject to the Closing
Adjustment.
(b) On or before the Closing, Seller and Purchaser
shall adjust the Closing Payment by the Closing Adjustment, if
applicable.
(c) As additional mutual consideration, Seller and
each of the Managers and Franco shall enter into the Releases on
the Closing Date.
Section 2.4 Closing Date . Delivery of the Stock and
payment to Seller of the Purchase Price at the Closing shall take
place at the offices of Cleary, Gottlieb, Xxxxx & Xxxxxxxx at Xxx
Xxxxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx, xx the Closing Date or at such
other location as shall be necessary or appropriate to close this
transaction prior to the issuance of any stay of the Bankruptcy
Court Approval Order.
Section 2.5 Delivery and Payment. At the Closing, each
of the following deliveries shall be made by the parties as
hereinbelow indicated and each such delivery shall be and be
deemed to be made simultaneously:
(a) Purchaser shall deliver to Seller:
(i) The Closing Payment, after taking into
account any Closing Adjustment, in immediately available funds by
federal funds check or certified check or bank wire to an account
designated by Seller; and
(ii) Executed counterparts, and/or certified
copies, as the case may be, of the instruments and documents
required to be delivered to Seller at the Closing as herein
provided.
(b) Seller shall deliver and/or transfer ownership of
to Purchaser (or if so indicated, the designee of Purchaser):
(i) Certificates representing the Stock duly
endorsed in blank or accompanied by duly executed stock
assignment power, in either case with signatures guaranteed;
(ii) The resignations of the officers and
directors of the Company (other than with respect to those
parties designated by Purchaser) effective immediately following
the Closing;
(iii) The items listed on Schedule 2.5(b)(iii)
(subject to finalization of corporate-wide inventory with respect
to items owned by Persons other than Seller) provided that,
notwithstanding anything to the contrary contained herein, Seller
makes no representation concerning the completeness or
effectiveness of any of the corporate documents of Sumtec
referred to thereon; and
(iv) Executed counterparts, and/or certified
copies, as the case may be, of the instruments and documents
required to be delivered to Purchaser at the Closing as herein
provided.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF SELLER
In order to induce Purchaser to execute and perform this
Agreement, Seller does hereby represent and warrant (which
representations and warranties shall be and be deemed to be
continuing and survive in accordance with Section 11.8(a) the
execution and delivery of this Agreement and the Closing Date) as
follows:
Section 3.1 Each of Seller and the Company is a
corporation duly organized, validly existing and in good standing
under the laws of the state of its incorporation. Each of Seller
and, to the knowledge of Seller, the Company is duly qualified to
do business as a foreign corporation, and is in good standing, in
all jurisdictions, if any, wherein such qualification is
necessary and where failure so to qualify would have material
adverse effect on the business, properties or finances of either
such corporation. To the knowledge of Seller, Seller has
received no notice that the Company does not have all licenses,
permits, certifications, registrations, approvals, consents and
franchises necessary to own or lease and operate the Company's
properties and to conduct the Company's Business as presently
being conducted; and Seller has received no notice that Seller
does not have all licenses, permits, certifications,
registrations, approvals, consents and franchises, the lack of
which would materially adversely affect the ability of Seller to
consummate this transaction.
Section 3.2 To the knowledge of Seller, Seller has
received no notice that the Company does not own the Company's
Accounts Receivable, Equipment or Other Assets; and to the
knowledge of Seller, Seller has received no notice that the
Company does not own, or otherwise have the right to use, the
General Intangibles except as listed on Schedule 3.2. Except as
listed on Schedule 3.2, Seller has not licensed, sold, leased or
encumbered the Property (other than those assets the lack of
which would not materially adversely affect the Business). To
the knowledge of Seller, Seller has received no notice that the
Company does not have the right to use the Resumes.
Section 3.3 The authorized and outstanding capitalization
of the Company is as set forth on Schedule 3.3. As of the date
hereof there is no authorized and/or issued and outstanding
shares of capital stock of the Company and/or rights to purchase
shares of capital stock of the Company except as set forth on
Schedule 3.3. The issued and outstanding shares of the Company
have been duly authorized and validly issued, and all such
outstanding shares are fully paid and nonassessable. There are
no outstanding options, warrants and similar rights to purchase
shares of the Company's capital stock. There are no preemptive
rights. Except as set forth on Schedule 3.3, no cash or non-cash
dividends or other distributions of the assets of the Company
have been declared, made or paid, or set aside for payment on or
with respect to the capital stock of the Company. Upon the
delivery of the certificates evidencing the Stock duly endorsed
in blank or accompanied by duly executed stock assignment powers,
Purchaser shall acquire good and marketable title in and to the
Stock free and clear of all liens, claims and encumbrances and
rights and options of others.
Section 3.4 Subject to the approval of the Bankruptcy
Court and compliance with applicable requirements of the
Bankruptcy Code: (i) Seller has the full corporate power and
authority to execute, deliver and perform this Agreement and to
consummate the transactions contemplated hereby; (ii) the
execution, delivery and performance of this Agreement, the
consummation by Seller of the transactions herein contemplated
and the compliance by Seller with the terms of this Agreement
have been duly authorized by all necessary corporate action, and
this Agreement has been duly and properly authorized, executed
and delivered by Seller; (iii) this Agreement is the valid and
binding obligation of Seller, enforceable in accordance with its
terms, subject, as to enforcement of remedies, to applicable
bankruptcy, insolvency, reorganization, moratorium and other laws
affecting the rights of creditors generally and the discretion of
courts in granting equitable remedies; (iv) the execution,
delivery and performance of this Agreement by Seller and the
consummation by Seller of the transactions herein contemplated
does not, and will not, with or without the giving of notice or
the lapse of time, or both, (A) result in any violation of the
Certificate of Incorporation or By-laws of Seller, (B) result in
a breach of or conflict with any of the terms or provisions of,
or constitute a default under, or result in the modification or
termination of, or result in the creation or imposition of any
lien, security interest, charge or encumbrance upon any of the
properties or assets of Seller and/or pursuant to, any indenture,
mortgage, note, contract, commitment or other agreement or
instrument to which Seller is a party or by which it or any of
its properties or assets are or may be bound or affected which
would have a material adverse effect on Seller's ability to
consummate the transactions herein contemplated; (C) violate any
existing applicable law, rule, regulation, judgment, order or
decree of any governmental agency or court, domestic or foreign,
having jurisdiction over Seller or any of its properties or
businesses; or (D) have any material effect on any permit,
certification, registration, approval, consent, license or
franchise necessary for Seller to own or lease and operate of its
properties and to conduct its businesses or the ability of Seller
to make use thereof. Since commencing its Chapter 11 Case,
Seller has been duly authorized to operate its businesses and
manage its properties pursuant to Sections 1107 and 1108 of the
Bankruptcy Code. No consent, approval, authorization or order of
any court (other than the Bankruptcy Court), governmental agency,
authority or body or any party to an agreement to which Seller is
a party or by which it is bound, is required in connection with
the execution, delivery and performance of this Agreement, or the
consummation by Seller of the transactions contemplated by this
Agreement.
Section 3.5 Prior to the date hereof, Seller has
delivered to Purchaser consolidated financial statements, which
include the accounts of the Company as of March 31, 1995, and the
results of operations of the Company for the fiscal year ended
March 31, 1995, audited by BDO Xxxxxxx, LLP ("Audited
Statements") and the most recent unaudited consolidated interim
financial statements, which include the accounts and results of
operations of the Company. To the knowledge of Seller, the
Audited Statements fairly present the financial position of the
Company as of the respective dates thereof and the results of
operations, and changes in financial position of the Company, for
each of the periods covered thereby. To the knowledge of Seller,
the Audited Statements have been prepared in conformity with
GAAP, applied on a consistent basis throughout the periods
covered. As of the date of any balance sheet forming a part of
the Audited Statements, and except as and to the extent reflected
or reserved against therein, the Company, to the knowledge of
Seller, did not have any material liabilities, debts, liens,
security interests or encumbrances, obligations or claims
(absolute or contingent) asserted against it which should have
been reflected in a balance sheet or the notes thereto.
Section 3.6 Seller has not incurred any liability for any
finder's fees or similar payments in connection with the
transactions herein contemplated except as set forth on Schedule
3.6.
Section 3.7 To the knowledge of Seller, except as set
forth on Schedule 3.7, the Company is not in default, in any
material respect, under the terms of any outstanding agreement
which is material to the Business, operations, Properties, or
condition of the Company; and there exists no event of default or
event which, with notice and/or the passage of time, or both,
would constitute any such default. In addition, to the knowledge
of Seller, except as set forth on Schedule 3.7, there are no
material claims, actions, suits, proceedings, arbitrations,
investigations or inquiries against the Company before any court
or governmental agency, court or tribunal, domestic or foreign,
or before any private arbitration tribunal, pending, or, to the
knowledge of Seller, threatened against the Company or involving
its Properties or Businesses which, if determined adversely to
the Company, would, individually or in the aggregate, result in a
material adverse change in the financial position, shareholder's
equity, results of operations, Properties, Business, management
or affairs of the Company, or which would prevent the
consummation of the transaction described herein. To the
knowledge of Seller, except as set forth on Schedule 3.7, there
are no outstanding orders, judgments or decrees or any court,
governmental agency or other tribunal specifically naming the
Company or enjoining the Company from taking, or requiring the
Company to take, any action by which the Company or its
Properties or Business would be materially adversely affected.
Section 3.8 Seller has included the Company in its
consolidated federal income tax returns and has filed all
applicable state and local income tax returns for the periods
November 1, 1993 through March 31, 1994, which were required to
be filed under the laws of the United States and all applicable
states, and has paid all such income taxes which were shown on
such returns to be due or are otherwise due and owing (other than
such taxes that are being disputed in good faith), except to the
extent that the failure to file such returns or pay such tax
would not have a material adverse effect on the Business. Seller
has also filed a consolidated federal and all applicable state
tax extension forms for the periods April 1, 1994 through March
31, 1995. No penalties or other charges are due with respect to
the late filing of any such income tax return. To the knowledge
of Seller, each such income tax return heretofore filed by Seller
with respect to the Company correctly and accurately reflects the
amount of its income tax liability thereunder.
Section 3.9 The officers and members of the Board of
Directors of the Company are as set forth on Schedule 3.9.
Section 3.10 Since the date of the most recent balance
sheet included in the Audited Statements, there has not been,
with respect to the Company (except as set forth in or permitted
by this Agreement, or as set forth on Schedule 3.10, or in the
ordinary course of business):
(i) To the knowledge of Seller, any change in its
accounting methods or practices (including, without limitation,
any change in depreciation, amortization and/or goodwill policies
or rates);
(ii) To the knowledge of Seller, any loan by the
Company to any Person or the issuance of any guaranty by the
Company for or with respect to its own or another obligation;
(iii) To the knowledge of Seller, any waiver or
release of any material right or claim of the Company;
(iv) To the knowledge of Seller, any amendment,
termination or modification of any material agreement or license
to which the Company is a party which has or may have a material
affect on the financial condition, Business or Property of the
Company; and
(v) To the knowledge of Seller, any agreement by
the Company to do or perform any of the things described in this
Section 3.10.
Section 3.11 To the knowledge of Seller, no material
breach or default exists with respect to the customer contracts
of the Company.
Section 3.12 The representations, warranties, covenants
and agreement of Seller contained in this Agreement are true,
accurate, correct and complete in all material respects as of the
date hereof and shall be true, accurate and complete in all
material respects as of the Closing.
Section 3.13 Notwithstanding anything to the contrary
contained herein, Seller makes no representations concerning
Sumtec.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE PURCHASING GROUP
In order to induce Seller to execute and perform this
Agreement, the members of the Purchasing Group, where relevant,
do hereby severally represent and warrant (which representations
and warranties shall be and be deemed to be continuing and
survive in accordance with Section 11.8(b) the execution and
delivery of this Agreement and the Closing Date) as follows:
Section 4.1 Each of Purchaser and Xxxx is a corporation
duly organized, validly existing and in good standing under the
laws of the state of its incorporation. Each of Purchaser and
Xxxx is duly qualified to do business as a foreign corporation,
and is in good standing, in all jurisdictions, if any, wherein
such qualification is necessary and where failure so to qualify
would have material adverse effect on the ability to consummate
this transaction.
Section 4.2 (i) Each member of the Purchasing Group
states for itself that it has the full power and authority,
whether corporate or otherwise, or in such member's individual
capacity, as the case may be, to execute, deliver and perform
this Agreement and to consummate the transactions contemplated
hereby; (ii) the execution, delivery and performance of this
Agreement, the consummation by Purchaser, Xxxx and XXXXX of the
transactions herein contemplated and the compliance by Purchaser,
Xxxx and ARTRA with the terms of this Agreement have been duly
authorized by all necessary corporate action, and this Agreement
has been duly and properly authorized, executed and delivered by
Purchaser, Xxxx and XXXXX; (iii) this Agreement is the valid and
binding obligation of each member of the Purchasing Group
enforceable in accordance with its terms, subject, as to
enforcement of remedies, to applicable bankruptcy, insolvency,
reorganization, moratorium and other laws affecting the rights of
creditors generally and the discretion of courts in granting
equitable remedies; (iv) the execution, delivery and performance
of this Agreement by Purchaser, Xxxx and ARTRA and the
consummation by Purchaser, Xxxx and XXXXX of the transactions
herein contemplated does not, and will not, with or without the
giving of notice or the lapse of time, or both, (A) result in any
violation of the Certificate of Incorporation or By-laws of
Purchaser, Xxxx and ARTRA, (B) result in a breach of or conflict
with any of the terms or provisions of, or constitute a default
under, or result in the modification or termination of, or result
in the creation or imposition of any lien, security interest,
charge or encumbrance upon any of the properties or assets of
Purchaser, Xxxx or XXXXX and/or pursuant to, any indenture,
mortgage, note, contract, commitment or other agreement or
instrument to which Purchaser, Xxxx or ARTRA is a party or by
which it or any of its properties or assets are or may be bound
or affected; (C) violate any existing applicable law, rule,
regulation, judgment, order or decree of any governmental agency
or court, domestic or foreign, having jurisdiction over
Purchaser, Xxxx and XXXXX or any of its properties or businesses;
or (D) have any material effect on any permit, certification,
registration, approval, consent, license or franchise necessary
for Purchaser, Xxxx and ARTRA to own or lease and operate any of
its properties and to conduct its businesses or the ability of
Purchaser, Xxxx and XXXXX to make use thereof. No consent,
approval, authorization or order of any court, governmental
agency, authority or body or any party to an agreement to which
Purchaser, Xxxx or ARTRA is a party or by which it is bound, is
required in connection with the execution, delivery and
performance of this Agreement, or the consummation by Purchaser,
Xxxx or XXXXX of the transactions contemplated by this Agreement.
Section 4.3 Each of the Guarantors hereby represents and
warrants that the financial statements delivered pursuant to
Section 2.2(c) fairly present the financial position of such
Guarantor as of the respective dates thereof and, in the case of
Xxxx and ARTRA, the results of operations, and changes in
financial position of each, for the periods covered thereby.
Section 4.4 The Managers and Franco have been employed by
Seller; the Managers are aware of the operational aspects of the
Business and the Company's financial condition and results of
operations; and Franco is generally aware of the operational
aspects of the Business and the Company's financial conditions
and results of operations. The Managers and Franco hereby
represent and warrant that, to the best of their knowledge and
belief, the representations and warranties made by Seller herein
for which the Managers and Franco have responsibility or control
or actual knowledge are true, accurate and complete.
Section 4.5 Each of Xxxxxxx and Xxxxxxxxxx hereby
represents and warrants that to his knowledge no facts, events or
circumstances exist that could reasonably be expected to give
rise to any obligations, expenses or liabilities of whatsoever
nature of Seller or its Affiliates other than as set forth on
Schedule 4.5 and except such obligations, expenses or liabilities
arising in the ordinary course of business.
Section 4.6 Each member of the Purchasing Group hereby
represents and warrants that, and each other member of the
Purchasing Group hereby represents and warrants that to its
actual knowledge, no former director or officer of Spectrum or
any of its corporate Affiliates is a member of the Purchasing
Group or is an active participant in the management of a member
of the Purchasing Group other than Xxxxxxx, Xxxxxxxxxx and
Xxxxxx.
Section 4.7 Purchaser hereby represents and warrants that
it shall not have unreasonably small capital for the business in
which each of them is engaged and proposes to be engaged
following the consummation of the transaction herein
contemplated.
Section 4.8 The representations, warranties, covenants
and agreement of each member of the Purchasing Group, contained
in this Agreement are true, accurate and correct in all respects
as of the date hereof and shall be true, accurate and correct in
all material respect as of the Closing.
ARTICLE V
COVENANTS AND AGREEMENTS BY SELLER
From the date hereof until the Closing Date, and after the
Closing Date with respect to Section 5.1(h), Seller covenants to
and agrees with Purchaser that:
Section 5.1 Conduct of Business.
(a) Seller shall cause and shall permit each Manager
to cause the Company to operate the Business in the usual and
ordinary course;
(b) Seller shall not remove or transfer to itself from
the Company any assets, including but not limited to, the payment
of cash dividends; provided, however, that (i) Seller reserves
the right to withdraw current profits through the payment of cash
dividends, to the extent allowed by the Bankruptcy Court, which
payments shall offset on a dollar for dollar basis the Closing
Payment as a Closing Adjustment; (ii) Seller shall remove those
assets in the Company's possession or located at the Company's
premises designated on Schedule 2.5(b)(iii) (subject to
finalization of corporate-wide inventory with respect to times
owned by Persons other than Seller); and (iii) Seller reserves
the right to transfer to itself an amount equal to any amount
paid by Seller to a third party on behalf of the Company
consistent with past practice (such as, e.g., comprehensive
general liability coverage, medical insurance, worker's
compensation in New York and Texas and New York State disability)
or any other payment required to be paid by Seller in order to
avoid a breach of any representation, warranty, covenant or
agreement of Seller herein. The parties hereto acknowledge that,
except as specifically provided for herein, the underlying
Property owned by the Company on the Closing Date will continue
to be owned by the Company immediately after the Closing;
(c) Seller shall not prohibit or hinder the Managers
from functioning as the senior management team of the Company,
and Seller understands that at Closing Purchaser shall reimburse
Seller, by means of a Closing Adjustment due to Seller from
Purchaser, any amounts for salary or other compensation actually
paid on or after July 1, 1995, by Seller to each of the Managers;
(d) Seller shall not prohibit or hinder Franco from
performing the necessary legal duties of the Company, and Seller
understands that at Closing Purchaser shall reimburse Seller, by
means of a Closing Adjustment due to Seller from Purchaser, any
amounts for salary, expenses, benefits or other compensation
actually paid on or after July 1, 1995, by Seller to Franco;
(e) Seller shall not prohibit or hinder the officers
and other authorized representatives of Purchaser from (i)
access, from time to time and at one or more times, to the
plants, properties, offices and books and records of the Company,
during normal business hours and upon reasonable advance notice,
and in connection with such books and records, such inspection
shall be at the offices where such records are normally
maintained, and such parties shall be entitled to make copies of
and abstracts from any of such books and records for purposes of
verifying the representations and warranties of Seller hereunder;
(ii) the opportunity to meet during normal business hours and
upon reasonable advance notice, correspond and communicate with
the officers, directors, employees, counsel and accountants to
the Company, and to secure from each such information as such
parties shall deem necessary or appropriate; and (iii) the
opportunity to review and copy such other, further and additional
financial and operating data, materials and information as to the
business and operations of the Company as may be reasonably
requested by such parties for purposes of verifying the
representations and warranties of Seller hereunder; provided
however, that all such information and material secured by such
parties in the course of such investigation shall be and be
deemed to be confidential and shall be used solely in connection
with the transactions herein described, and all written memoranda
and documents and other tangible evidence of such information
shall be required, pursuant to a confidentiality agreement,
either to be returned to the Company or destroyed in the event
the subject acquisition is not consummated; and provided,
further, that the foregoing does not unreasonably interfere with
or disrupt the Business or Seller's business;
(f) At all times prior to the Closing Date, Seller
shall promptly notify Purchaser in writing of the occurrence of
any event that will or may result in the failure to satisfy the
conditions contained in Article IX hereof; and
(g) Seller shall refrain from making any adverse
statements about any member of the Purchasing Group and such
member's business that could reasonably be expected to, and that
do, have a material adverse consequence to any member of the
Purchasing Group, other than any such statements included in the
filing of a complaint or as required by law or in testimony (or
in any interview with an officer of the court or governmental
agency) in connection with a legal action in which it is a party
or is threatened to be made a party or pursuant to valid legal
process.
Section 5.2 Bankruptcy Court Approval Order. Seller
shall promptly, but not later than five (5) business days from
the date of execution of this Agreement, make a motion to the
Bankruptcy Court seeking entry of an order pursuant to Sections
363(b) and 363(f) of the Bankruptcy Code approving this Agreement
and the transactions contemplated hereunder. Such motion shall
be made in accordance with such terms, conditions and procedures
as the Bankruptcy Court may deem appropriate and shall be subject
to higher and better offers and other requirements. Seller shall
use its best efforts in good faith to cause the issuance of the
Bankruptcy Court Approval Order. Seller shall also obtain
confidentiality, nondisclosure and indemnity agreements from
prospective purchasers or bidders prior to disseminating any
confidential or proprietary information with respect to the
Company to such prospective purchasers or bidders.
Section 5.3 Further Assurances. Seller shall take such
additional action and shall coordinate with Purchaser as may be
reasonably necessary or appropriate for the consummation of the
transactions contemplated hereby to carry out and effectuate the
terms and conditions of this Agreement; provided, however, that
nothing in this Section 5.3 shall obligate Seller to take any
actions related to the Bankruptcy Court Approval Order other than
as provided in Section 5.2.
Section 5.4 Assumption of Certain Compensation Expenses.
Seller shall reimburse Purchaser, by means of a Closing
Adjustment, any salary, expenses, benefits or other compensation
actually paid on or after July 1, 1995 by the Company to Xxxxxx
X. Xxxxxxx, Xxx Xxxxxxxxxxx, and Xxxxxx X. Xxxxxx, pursuant to
each such individual's respective employment agreement.
ARTICLE VI
COVENANTS AND AGREEMENTS BY THE PURCHASING GROUP
From the date hereof until the Closing Date, and after the
Closing Date with respect to Sections 6.1(c), 6.2, 6.3 and 6.4,
Purchaser and Xxxx covenant and agree, and where so specifically
stated, each member of the Purchasing Group covenants and agrees,
that:
Section 6.1 Further Assurances. (a) Each member of the
Purchasing Group shall take such additional action and shall use
its best efforts to coordinate with Seller as may be reasonably
necessary or appropriate for the consummation of the transactions
contemplated hereby to carry out and effectuate the terms and
conditions of this Agreement, including, but not limited to,
using its best efforts in good faith to cause the issuance of the
Bankruptcy Court Approval Order and all other necessary
approvals, authorizations and waivers;
(b) At all times prior to the Closing Date, Purchaser
shall promptly notify Seller in writing of the occurrence of any
event that will or may result in the failure to satisfy the
conditions contained in Article VIII hereof; and
(c) Purchaser shall provide Seller with reasonable
access to any Records after the date hereof (other than the
Resumes) subject to reasonable confidentiality restrictions.
Section 6.2 Use of Spectrum Name. Except as required by
law, no member of the Purchasing Group shall use in the conduct
of such member's business the name and xxxx "Spectrum Global
Services, Inc." or "Spectrum", whether alone or in combination
with other words; provided, however, that the Company may use the
name "Spectrum Global Services, Inc." or "Spectrum" solely in
order to explain its historical corporate background but in no
case in order to promote the Business or any other business into
which the Company or its affiliates may enter.
Section 6.3 Pre-Closing Confidentiality. Each member of
the Purchasing Group other than the Managers and Franco and each
of the officers, employees and other representatives of each such
member, if applicable, shall treat as confidential, keep secret
and not use in the course of its business any information of a
confidential nature relating in any way to the affairs of the
Company or Seller and, at any time before the Closing Date, will
not, without the prior written consent of Seller, disclose,
furnish or make known or accessible to, or use for the benefit
of, anyone any information of a confidential nature relating in
any way to the Business unless such information is otherwise
publicly available. If, for any reason, including without
limitation, termination of this Agreement pursuant to Article X,
the transactions contemplated hereby are not consummated, each
member of the Purchasing Group shall and shall cause each of the
officers, employees and other representatives of each such
member, if applicable, to promptly return to Seller, all
documents, papers, books, records and other materials (and all
copies thereof) obtained by any of them in connection with the
investigation and evaluation of the Business or the transactions
contemplated hereby, destroy all other documents prepared by any
member of the Purchasing Group which are based on the documents
so obtained, and refrain from making any adverse statements about
Seller, its business and its Affiliates that could reasonably be
expected to, and that do, have a material adverse consequence to
Seller or its corporate Affiliates other than any such statements
included in the filing of a complaint or as required by law or in
testimony (or in any interview with an officer of the court or
governmental agency) in connection with a legal action in which
such member is a party or is threatened to be made a party or
pursuant to valid legal process.
Section 6.4 Post-Closing Confidentiality. After the
Closing Date, each member of the Purchasing Group covenants and
agrees that it shall promptly return to Seller all documents,
papers, books, records and other materials (and all copies
thereof) concerning Seller's business obtained by such member in
connection with the investigation and evaluation of the Business
or the transactions contemplated hereby, destroy all other
documents prepared by such member which are based on the
documents so obtained, refrain from using any information in the
documents of a confidential nature relating in any way to Seller,
and refrain from making any adverse statements about Seller, its
business and its Affiliates that could reasonably be expected to,
and that do, have a material adverse consequence to Seller or its
corporate Affiliates other than any such statements included in
the filing of a complaint or as required by law or in testimony
(or in any interview with an officer of the court or governmental
agency) in connection with a legal action in which such member is
a party or is threatened to be made a party or pursuant to valid
legal process.
Section 6.5 Assumption of Certain Compensation Expenses.
At Closing Purchaser shall reimburse Seller, by means of a
Closing Adjustment due to Seller from Purchaser, any amounts for
salary, expenses, benefits or other compensation actually paid on
or after July 1, 1995 by Seller to each of the Managers and
Franco.
ARTICLE VII
ADDITIONAL COVENANTS AND AGREEMENTS BY THE MANAGERS AND FRANCO
Section 7.1 Further Assurances. From the date hereof
until the Closing Date the Managers and Franco covenant and agree
that:
(a) the Managers (i) shall perform their duties as the
senior management team of the Company in the ordinary course of
business consistent with past practice; (ii) shall not
intentionally cause by either of their actions or omissions any
representation or warranty of Seller contained herein to become
untrue; (iii) shall not intentionally take any action to cause
Seller to breach any of its covenants or agreements; (iv) shall
promptly notify Seller if either of them becomes aware of any
condition or event that will or may reasonably be expected to
result in the failure to satisfy the conditions contained in
Article IX; and (v) shall cooperate fully with due diligence
activities related to Seller's marketing of the Company, although
they shall not be required to interface directly with any
prospective bidders;
(b) Franco (i) shall perform the necessary legal
duties of the Company from the date hereof; (ii) shall not
intentionally cause by his actions or omissions any
representation or warranty of Seller contained herein to become
untrue; (iii) shall not intentionally take any action to cause
Seller to breach any of its covenants or agreements; (iv) shall
promptly notify Seller if he becomes aware of any condition or
event that will or may reasonably be expected to result in the
failure to satisfy the conditions contained in Article IX; and
(v) shall cooperate fully with due diligence activities related
to Seller's marketing of the Company, although he shall not be
required to interface directly with any prospective bidders; and
(c) All material business decisions made by the
Managers or Franco and all omissions of the Managers or Franco
respecting material business decisions from the date hereof until
the Closing shall be subject to the prior written approval of the
Chief Executive Officer of Seller. The consequence of any
failure to obtain such approval with respect to a material
decision (including with respect to an inadvertent omission)
shall be that (i) Seller shall be released from all
responsibility and liability with respect to any breach of the
representations, warranties, agreements or covenants made by
Seller in this Agreement (or any failure of any Schedule to be
true, complete and accurate) resulting from such material
decision or omission; (ii) the requirements of Section IX(c)
shall be waived with respect to each such representation and
warranty and the requirements of Section IX(b) shall be waived
with respect to each such agreement and covenant; and (iii)
Seller shall not be deemed to be in material breach of any such
representation, warranty, agreement or covenant for purposes of
Section 10.2(b) hereof. The Chief Executive Officer of Seller
shall respond to any request for such approval promptly after due
deliberation and the failure to so respond shall be deemed to
constitute an approval.
ARTICLE VIII
SELLER'S CONDITIONS TO CLOSING
The obligation of Seller to consummate the transactions
contemplated by this Agreement is, unless waived by Seller,
subject to the fulfillment, on or before the Closing, of each of
the following conditions:
(a) No injunction or restraining order shall be in
effect which prohibits, restricts or enjoins, and no suit, action
or proceeding shall be pending which seeks to prohibit, restrict,
enjoin, nullify, seek material damages with respect to or
otherwise materially adversely affect the consummation of the
transactions contemplated hereby;
(b) All covenants of each member of the Purchasing
Group under this Agreement to be performed prior to the Closing
shall have been performed in all material respects, except to the
extent attributable to actions expressly permitted or consented
to by Seller in writing;
(c) Seller shall have received a certificate, executed
by each of the President and Secretary of Purchaser, Xxxx and
XXXXX, and each of the Managers, Xxxxxx, Xxxxxx and Xxxxxx
(effective as of the Closing), and in form and content reasonably
acceptable to Seller, certifying the truth and accuracy of the
representations and warranties of each contained herein;
(d) Seller shall have received from Purchaser, Xxxx
and ARTRA a certificate from the Department of State of the state
of incorporation of each to the effect that each of Purchaser,
Xxxx and XXXXX are in good standing in such state;
(e) The Bankruptcy Court Approval Order shall have
been entered; all material statutory requirements for the valid
consummation by Purchaser of the transactions herein described
shall have been fully and timely satisfied; all material
authorizations, approvals or waivers of any federal or state
regulatory body shall have been obtained in order to permit
consummation by Purchaser of the transactions herein described,
and/or to permit Purchaser to assume the Business at the Closing;
and no action or proceeding to suspend, revoke, cancel,
terminate, modify or alter any of such authorizations, approvals
or waivers shall be pending or threatened;
(f) Seller shall have received all certificates,
instruments, agreements and other documents to be delivered by
each member of the Purchasing Group at or before Closing as
provided in this Agreement and a certificate signed individually
or by an officer of each member of the Purchasing Group, as the
case may be, confirming the matters set forth in paragraphs (a),
(b) and (e) (other than with respect to the Bankruptcy Court
Approval Order) above;
(g) [Intentionally Omitted]
(h) The Purchasing Group shall tender to Seller the
Closing Payment, after taking into account any mutually agreed
upon Closing Adjustments, in immediately available funds by
federal funds check or certified check or bank wire to an account
designated by Seller; and
(i) Seller shall have received all the documentation
required to be delivered to it pursuant to the provisions of this
Agreement, in form and content reasonably satisfactory to Seller
and its Counsel.
ARTICLE IX
PURCHASER'S CONDITIONS TO CLOSING
The obligation of the Purchaser to consummate the
transactions, and the obligations of the Guarantors to fulfill
their obligations under the Guarantees contemplated by this
Agreement is, unless waived by Purchaser, subject to the
fulfillment, on or before the Closing, of each of the following
conditions:
(a) No injunction or restraining order shall be in
effect which prohibits, restricts or enjoins, and no suit, action
or proceeding shall be pending which seeks to prohibit, restrict,
enjoin, nullify, seek material damages with respect to or
otherwise materially adversely affect the consummation of the
transactions contemplated hereby other than those set forth on
Schedule 3.7;
(b) All covenants of Seller under this Agreement to be
performed prior to the Closing shall have been performed in all
material respects, except to the extent attributable to actions
expressly permitted or consented to by Purchaser in writing;
(c) Purchaser shall have received a certificate,
executed by the President and Secretary of Seller (effective as
of the Closing), and in form and content reasonably acceptable to
Purchaser, certifying the truth and accuracy of the
representations and warranties of Seller contained herein;
(d) Purchaser shall have received from each of Seller
and the Company a certificate from the Department of State of the
State of Delaware to the effect that each of Seller and the
Company is in good standing in such state;
(e) The Bankruptcy Court Approval Order shall have
been entered; all material statutory requirements for the valid
consummation by Seller of the transactions herein described shall
have been fully and timely satisfied; all material
authorizations, approvals or waivers of any federal or state
regulatory body shall have been obtained in order to permit
consummation by Seller of the transactions herein described,
and/or to permit Purchaser to assume the Business at the Closing;
and no action or proceeding to suspend, revoke, cancel,
terminate, modify or alter any of such authorizations, approvals
or waivers shall be pending;
(f) Purchaser shall have received all certificates,
instruments, agreements, Property in Seller's possession (as
described in Section 2.5(b)(iii)) and other documents to be
delivered by Seller at or before Closing as provided in this
Agreement, including a certificate signed by an officer of Seller
confirming the matters set forth in paragraphs (a), (b) and (e)
(other than with respect to the Bankruptcy Court Approval Order)
above;
(g) Purchaser has received such documentation as may
be necessary to establish that Purchaser is not required to
withhold any portion of the Purchase Price pursuant to Section
1445 of the United States Internal Revenue Code of 1986
(substantially in the form of Exhibit H hereto);
(h) Purchaser shall have received releases from all
guarantees by the Company (all of which are set forth on Schedule
IX(h) hereto) including but not limited to those related to the
employment agreement of Xxxxxx X. Xxxxxxx with Seller
(substantially in the form of Exhibit I hereto) and the
engagement agreement of Gordian Group, L.P. with Seller
(substantially in the form of Exhibit J hereto) and a release
from the employment agreement with Xxxxxx X. Xxxxxxx
(substantially in the form of Exhibit K hereto);
(i) Seller shall tender to Purchaser certificates
representing the Stock duly endorsed and in form for transfer to
Purchaser or accompanied by stock powers endorsed in blank; and
(j) Purchaser shall have received all the
documentation required to be delivered to it pursuant the
provisions of the Agreement, in form and content reasonably
satisfactory to Purchaser and its counsel.
ARTICLE X
TERMINATION
Section 10.1 Termination. Anything herein or elsewhere to
the contrary notwithstanding, this Agreement and any agreement
ancillary hereto may be terminated and the transactions
contemplated hereby abandoned at any time prior to or at the
Closing by:
(a) mutual consent of Seller and Purchaser upon the
express approval of the respective Boards of Directors of Seller
and Purchaser and the express approval of Managers and Franco;
(b) Seller, if any of the conditions set forth in
Article VIII shall not have been met and shall not have been
waived by Seller as of the Closing Date and at such xxxx Xxxxxx
is not in material breach or default of its covenants,
representations or other obligations contained in this Agreement,
or if, prior to the Closing, any member of the Purchasing Group
is in material breach or default of its covenants,
representations or other obligations contained in this Agreement;
(c) Purchaser, if any of the conditions set forth in
Article IX shall not have been met and shall not have been waived
by Purchaser as of the Closing Date and at such time Purchaser is
not in material breach or default of any of its covenants,
representations or other obligations contained in this Agreement,
or if, prior to the Closing, Seller is in material breach or
default of its covenants, representations or other obligations
contained in this Agreement; or
(d) automatically, if the Bankruptcy Court approves a
competing bid for the Stock or a bid for all or substantially all
of the assets of the Company.
Any party desiring to terminate this Agreement pursuant to
this Article X shall give notice of such termination to the other
party hereto in accordance with Section 12.7.
Section 10.2 Effect of Termination.
(a) If this Agreement is terminated in accordance with
Section 10.1 or 10.3, then all rights and obligations of the
parties hereunder shall terminate and be of no further effect;
provided, however, that no such termination shall relieve any
party of liability for any breach of its obligations under this
Agreement or any other obligation to indemnify arising under this
Agreement prior to such termination; and, provided further, that
Sections 6.3, 10.2(b) and 11.8 shall apply.
(b) (A) If prior to the time of termination pursuant
to Section 10.1, this Agreement is terminated pursuant to Section
10.3(a), one-half of the Deposit (including earnings on such
portion) shall be immediately refunded to Purchaser and the
remainder of the Deposit (including earnings on such portion)
shall be released from escrow and transferred to Seller pursuant
to the terms of the Escrow Agreement; (B) if prior to the time of
other termination pursuant to Section 10.1 or 10.3(a), (i) this
Agreement is terminated pursuant to Section 10.3(b); or (ii) this
Agreement is terminated because Seller is in material breach or
default of any of its covenants, representations or other
obligations under this Agreement or (iii) this Agreement is
terminated because at the Closing, Purchaser has not received, or
waived the receipt of, the items listed in Article IX(c), (d),
(g) and (h) and the Closing has not occurred or (iv) this
Agreement is terminated pursuant to Section 10.1(d), the Deposit
(including earnings on such portion) shall be immediately
refunded to Purchaser; and (C) in all other cases of termination,
the Deposit (including earnings on such portion) shall be
released from escrow and transferred to Seller pursuant to the
terms of the Escrow Agreement.
Section 10.3 Bankruptcy Court Approval Order.
(a) From October 28, 1995, through and until November
27, 1995, and only during such period, if the Bankruptcy Court
Approval Order has not been entered at the time, Purchaser shall
have the right, at its option, to terminate this Agreement and to
abandon the transactions contemplated hereby by providing written
notice to Seller in accordance with Section 12.7.
(b) On or after January 1, 1996, if the Bankruptcy
Court Approval Order has not been entered at the time, Purchaser
and Seller shall each have the right, at their options, to
terminate this Agreement and to abandon the transactions
contemplated hereby.
(c) For purposes of this Agreement, if at any time
there is in effect a stay of the Bankruptcy Court Approval Order
issued by a court of competent jurisdiction, the Bankruptcy Court
Approval Order shall be deemed as not having been entered at such
time. Purchaser and Seller agree to use best efforts to cause
this transaction to be closed prior to the issuance of any such
stay and to extinguish any such stay which is issued.
ARTICLE XI
RELEASES, INDEMNIFICATION AND SURVIVAL OF REPRESENTATIONS
Section 11.1 Releases. At the Closing, Seller, the
Managers and Franco agree to execute the Releases.
Section 11.2 Indemnification by Seller. (a) Seller
agrees to indemnify and hold harmless Purchaser from and against
all demands, claims, actions or causes of action, assessments,
losses, damages, expenses and liabilities (collectively, the
"Damages") asserted against or incurred by Purchaser as a result
of any breach of any representation, covenant or agreement by
Seller contained herein.
(b) Seller agrees to indemnify and hold harmless Purchaser
from and against any Damages arising from the nonpayment of any
federal or state income taxes, or penalties thereon, that are due
and payable with respect to any taxable period (or portion
thereof) of the Company ending on or before the Closing Date.
Section 11.3 Indemnification by Purchaser and Xxxx.
Purchaser and Xxxx jointly and severally agree to:
(a) indemnify and hold harmless Seller and, prior to
the Closing, the Company, from and against all Damages asserted
against or incurred by Seller or the Company, as the case may be,
as a result of any breach of any representation, covenant or
agreement by any member of the Purchasing Group, including a
member other than Purchaser and Xxxx, contained herein; and
(b) indemnify and hold harmless Seller and its
Affiliates from and against all Damages asserted against or
incurred by Seller or its Affiliates arising from the Business or
the conduct of any employee or officer of the Company (other than
the actual conduct of Xxxxxx X. Xxxxxxx), except for such actions
of Xxxxxxx in his former capacity as a director of Seller;
provided, however, that such indemnification obligations shall
not apply with respect to Damages arising under Section 11.2,
unless such Damages arising under Section 11.2 are the result of
any actions or omissions by any of Xxxxxxx, Xxxxxxxxxx or Xxxxxx.
Section 11.4 Indemnification by the Managers and Franco.
The Managers and Franco will jointly and severally
indemnify and hold harmless Seller and its Affiliates from and
against all Damages asserted against or incurred by Seller or its
Affiliates which arise as a result of the willful misconduct of
any of them; provided, however, that this obligation to indemnify
and hold harmless Seller and its Affiliates shall not exceed the
sum of Fifty Thousand Dollars ($ 50,000), which amount shall be
deposited in escrow, pursuant to the terms of an escrow agreement
of even date herewith (the "Manager Escrow Agreement") among
Seller, the Managers, Franco and the Manager Escrow Agent (as
defined in the Manager Escrow Agreement) substantially in the
form of Exhibit P hereto, on the Closing Date and held in escrow
until the first anniversary of the Closing Date. Notwithstanding
anything herein to the contrary, the obligation of the Managers
and Franco to indemnify and hold harmless Seller and its
Affiliates contained in this Section 11.4(b) shall be continuing
and survive, in accordance with Section 11.8(d), the execution
and delivery of this Agreement and the Closing Date.
Section 11.5 Indemnification by Guarantors. The
Guarantors other than Xxxx each severally agree to indemnify and
hold harmless Seller and, prior to the Closing, the Company, from
and against all Damages asserted against or incurred by Seller or
the Company, as the case may be, as a result of any breach of any
representation, covenant or agreement by any such Guarantor
contained herein.
Section 11.6 [Intentionally Omitted]
Section 11.7 Indemnification Procedures.
11.7.1 Notice of Asserted Liability. Each party
seeking indemnification shall promptly give notice to the party
from whom indemnification is sought (each such notice, a "Claims
Notice") of any demand, claim or circumstance which gives rise,
or with the lapse of time would or might give rise to a claim or
the commencement (or threatened commencement) of any action,
proceeding or investigation that may result in any losses (an
"Asserted Liability"), without regard to limitations on
indemnification set forth above. The Claims Notice shall
describe the Asserted Liability in reasonable detail, and shall
indicate the amount (estimated, if necessary, and to the extent
feasible) of the losses that have been suffered by an Indemnified
Party.
11.7.2 Defense of Asserted Liability. If the facts
giving rise to the claim for indemnification shall involve any
actual or threatened claim or demand by any third party against
or by any Indemnified Party or by an Indemnified Party against
any third party, the relevant Indemnified Party shall defend or
prosecute such claim through counsel of such Indemnified Party's
choosing, which counsel shall be reasonably satisfactory to the
Indemnifying Party, and the reasonable expenses of which shall be
borne by the Indemnifying Party (subject to the limitations set
forth above); provided, however, that the Indemnifying Party
shall not be responsible for fees and expenses of more than one
counsel in each jurisdiction and provided further that in the
case of a claim for indemnification relating to Section 3.8
(dealing with tax matters), Seller shall defend or prosecute such
claim through counsel of its choosing. No Indemnifying Party
shall be subject to any liability for any settlement made without
such Indemnifying Party's consent; provided, however, that such
consent shall not be unreasonably withheld; and provided,
further, that no such consent shall be required of an
Indemnifying Party with respect to any settlement if such
settlement would give rise to no liability on the part of such
Indemnifying Party.
Section 11.8 Termination of Indemnification Obligations.
(a) The obligation of Seller to indemnify under
Section 11.2 shall survive the Closing Date and terminate on the
second anniversary of the Closing Date, except (i) in each case
as to matters as to which any Indemnified Party has given a
Claims Notice under Section 11.7.1 on or prior to such date, in
which case the right to indemnification with respect thereto
shall survive the expiration of any such period until such claim
is finally resolved and any obligations with respect thereto are
fully satisfied; and (ii) with respect to any Claims Notice
arising solely from the matters contained in Section 3.8, in
which case the right to indemnification with respect thereto
shall survive the Closing Date and terminate on the third
anniversary following the filing of any income tax return
referred to in Section 3.8 or upon such other expiration of the
limitation period relevant to such income tax return.
(b) The obligation of each of Purchaser and Xxxx to
indemnify under Section 11.3(a) and the obligation of each of the
Guarantors to indemnify under Section 11.5 shall each survive the
Closing Date and terminate on the second anniversary of the
Closing Date, except in each case as to matters as to which any
Indemnified Party has given a Claims Notice under Section 11.7.1
on or prior to such date, in which case the right to
indemnification with respect thereto shall survive the expiration
of any such period until such claim is finally resolved and any
obligations with respect thereto are fully satisfied.
(c) The obligation of each of Purchaser and Xxxx to
indemnify under Section 11.3(b) shall survive the Closing Date
and the expiration of any such period until any such claim is
finally resolved and any obligations with respect thereto are
fully satisfied.
(d) The obligation of each of the Managers and Franco
to indemnify under Section 11.4 shall survive the Closing Date
and terminate eighteen (18) months after the Closing Date, except
in each case as to matters as to which any Indemnified Party has
given a Claims Notice under Section 11.7.1 on or prior to such
date, in which case the right to indemnification with respect
thereto shall survive the expiration of any such period until
such claim is finally resolved and any obligations with respect
thereto are fully satisfied.
Section 11.9 Certain Representations and Covenants
Except as provided in Section 11.4, neither the
Managers nor Franco shall have any personal liability for any
breach of any representation, warranty, agreement or covenant
made by them herein (a "Manager or Franco Breach"). However, in
the event of any such Manager or Franco Breach (i) Seller shall
be released from all responsibility and liability with respect to
the breach of any representations, warranties, agreements or
covenants made by Seller in this Agreement (or any failure of any
Schedule to be true, complete and accurate) as a result of any
such Manager or Franco Breach or as a result of the event,
circumstance or condition causing such Manager or Franco breach;
(ii) the requirements of Section IX(c) shall be waived with
respect to each such representation or warranty and the
requirements of Section IX (b) shall be waived with respect to
each such agreement or covenant; and (iii) Seller shall not be
deemed to be in material breach of any such representation,
warranty, agreement or covenant for purposes of Section 10.2(b)
hereof as a result of any such Manager or Franco Breach or as a
result of the event, circumstance or condition causing such
Manager or Franco Breach.
ARTICLE XII
MISCELLANEOUS
Section 12.1 Expenses . Subject to the rights of
indemnity contained in Article XI, each of the parties to this
Agreement shall pay all of its own expenses relating to the
transaction contemplated by this Agreement, including, without
limitation, the fees and expenses of its respective counsel,
accountants, financial advisers and any broker's, finder's or
similar agent's fee.
Section 12.2 Role of the Managers and Franco in
Negotiations. Seller agrees that: (i) the Managers and Franco
are not and shall not be deemed to be representatives of Spectrum
for the purpose of negotiating this Agreement and other actions
incident hereto; (ii) the Managers and Franco may act on behalf
of Purchaser and Xxxx for such purpose; and (iii) the actions
referenced in clauses (i) and (ii) immediately above and actions
consistent with such purpose do not constitute a breach of
fiduciary or other duties pursuant to the terms of their
respective employment agreements with Spectrum, under the common
law, or otherwise.
Section 12.3 Non-Competition Agreement. Seller shall
enter into and deliver to Purchaser at the Closing an agreement
substantially in the form of Exhibit Q hereto not to compete in
the Business for a period of not less than three and one-half
(3.5) years; provided, however, that Seller, at its option, may
provide services on a contract labor basis to the extent such
services are only directly related to the project, engagement,
system or solution for which Seller's Systems Integration
business was retained by the client; and provided, further, that
the Company and each member of the Purchasing Group shall enter
into and deliver to Seller at the Closing the Non-Competition
Agreement (substantially in the form of Exhibit Q hereto) not to
compete in Seller's wireless data communication software product
business for a period of not less than three and one-half (3.5)
years unless it first offers the opportunity to Seller of
participating in a joint project or venture with respect to such
business.
Section 12.4 Governing Law. The interpretation and
construction of this Agreement, and all matters relating hereto,
shall be governed by the domestic laws of the State of New York
and the Bankruptcy Code to the extent applicable.
Section 12.5 Jurisdiction. Any judicial proceeding
brought against any of the parties to this Agreement on any
dispute arising out of this Agreement or any matter related
hereto shall be brought in the courts of the State of New York or
in the United States District Court for the Eastern District of
New York (or the Bankruptcy Court), and, by execution and
delivery of this Agreement, each of the parties to this Agreement
accepts for itself or himself the process in any action or
proceeding by the mailing of copies of such process to such party
at its or his address as set forth in Section 12.7, and
irrevocably agrees to be bound by any judgment rendered thereby
in connection with this Agreement. Each party hereto irrevocably
waives to the fullest extent permitted by law any objection that
it or he may now or hereafter have to the laying of the venue of
any judicial proceeding brought in such courts and any claim that
any such judicial proceeding has been brought in an inconvenient
forum. The foregoing consent to jurisdiction shall not
constitute general consent to service of process in the State of
New York for any purpose except as provided above and shall not
be deemed to confer rights on any person other than the
respective parties to this Agreement. EACH PARTY HERETO WAIVES
TRIAL BY JURY, IF ANY, IN ANY JUDICIAL PROCEEDING UNDER THIS
AGREEMENT OTHER THAN A RIGHT FOR TRIAL BY JURY IN ANY JUDICIAL
PROCEEDING IN THE BANKRUPTCY COURT DURING THE PENDENCY OF
SELLER'S CHAPTER 11 CASE.
Section 12.6 Captions. The Article and Section captions
used herein are for reference purposes only and shall not in any
way affect the meaning or interpretation of this Agreement.
Section 12.7 Notices. Unless otherwise provided herein,
any notice, request, instruction or other document to be given
hereunder by any party to any other party shall be in writing and
shall be deemed to have been given (a) upon personal delivery, if
delivered by hand, (b) three (3) days after the date of sending
such notice by certified mail, return receipt requested, or (c)
the next business day if sent by facsimile transmission or by an
over night courier service, and in each case of mailing, postage
prepaid and at the respective addresses or numbers set forth
below:
If to the Purchasing Group, addressed to:
ARTRA Group Incorporated
Xx. Xxxxx X. Xxxxxx
Xx. Xxxx X. Xxxxxx
The Xxxx Corporation
000 Xxxxxxx Xxxxxx
Xxxx Xxxxxx Xxx 0000
Xxxxxxxxxx, XX 00000-0000
Attention: Xx. Xxxxx X. Xxxxxx
Fax: (000) 000-0000
Comforce Corp.
0000 Xxxxxx Xxx. - Xxxxx X000
Xxxx Xxxxxxx, XX 00000
Attn: Xx. Xxxxxxxxxxx X. Xxxxxx
Xx. Xxxxx X. Xxxxxxx
00 Xxxxx Xxxxx
Xxxxxxxx, XX 00000
FAX: 000-000-0000
Xx. Xxxxxxx Xxxxxxxxxx
000 Xxxxx Xxxxx Xxxx
Xxxx Xxxx, XX 00000
Xx. Xxxxxxxxxxx X. Xxxxxx
00 Xxxxxxxx Xxxx
Xxxxxxxxx, XX 00000
with a copy to:
Xxxx X. Xxxxxxxx, Esq.
Attorney At Law
00 Xxxxxxx Xxxx, Xxxxx 0000
Xxxxxx, XX 00000
FAX: 000-000-0000
If to Seller, addressed to:
Spectrum Information Technologies, Inc.
0000 Xxxxxxxxxxx Xxxxxx
Xxxxxxxx, XX 00000
Attention: Xx. Xxxxxx X. Xxxxxxx
FAX: 000-000-0000
with a copy to:
Cleary, Gottlieb, Xxxxx & Xxxxxxxx
Xxx Xxxxxxx Xxxxx, Xxxxx 0000
Xxx Xxxx, XX 00000
Attention: Xxxxx X. Xxxxxxx, Esq.
FAX: 000-000-0000
or in any case to such other address or number as any party may
fix by notice.
Section 12.8 Parties in Interest. This Agreement may not
be transferred, assigned, pledged or hypothecated by any party
hereto, other than by operation of law or with the prior written
consent of the other parties hereto, and any purported transfer,
assignment, pledge or hypothecation in violation of this Section
shall be void. This Agreement shall be binding upon and shall
inure to the benefit of the parties hereto and their respective
administrators, successors and permitted assigns.
Section 12.9 Severability. In the event any provision of
this Agreement is found to be void and unenforceable by a court
of competent jurisdiction or arbitration panel, the remaining
provisions of this Agreement shall nevertheless be binding upon
the parties with the same effect as though the void or
unenforceable part had been severed and deleted.
Section 12.10 Counterparts. This Agreement may be executed
in one or more counterparts, each of which shall be deemed to be
an original but all of which taken together shall constitute one
instrument.
Section 12.11 Entire Agreement. This Agreement, including
the other documents referred to herein, contains the entire
understanding of the parties hereto with respect to purchase of
the Stock by Purchaser and supersedes all prior agreements,
correspondence, conversation, negotiations and understandings
between the parties with respect to such subject matter.
Section 12.12 Amendments. This Agreement may not be
changed orally, but only by an agreement in writing signed by all
of the parties hereto, and no waiver of compliance with any
provision or condition hereof and no consent provided for herein
shall be effective unless evidenced by an instrument in writing
duly executed by the party against whom such waiver or consent is
sought.
Section 12.13 Third Party Beneficiaries. Subject to the
provisions in Sections 6.3 and 6.4 relating to adverse statements
about Seller's Affiliates, in Section 10.2(b) relating to the
effect of termination and in Article XI relating to the
indemnification and release of Seller's Affiliates, each party
hereto intends that this Agreement shall not benefit or create
any right or cause of action in or on behalf of any person other
than the parties hereto and their respective successors and
assigns as permitted under Section 12.8.
Section 12.14 Gender. As used in this Agreement, any
gender includes a reference to all other genders and the singular
includes a reference to the plural and vice versa.
Section 12.15 Protection of the Value of the Company. The
Seller intends not to distribute any detailed proprietary
customer information unless to a serious bidder; provided,
however, that the determination of whether a bidder is a serious
bidder shall be within the sole discretion of Seller.
Section 12.16 Cooperation - Tax Matters. The Seller, on
the one hand, and the Company and the Purchasing Group on the
other hand, will cooperate fully with each other, on a reasonable
basis, in connection with the preparation, signing and filing of
any tax returns and in any administrative, judicial or other
proceeding involving taxes, including but not limited to the
furnishing or making available of records, books of account or
other materials necessary or helpful for the defense against
assertions of any taxing authority as to any tax returns for such
year or period. Seller shall be responsible for the preparation
of, and shall deliver to the Company for signing and filing to
the extent necessary, any income tax return relating to the
Company for any period ending on or prior to the Closing Date.
ARTICLE XIII
BANKRUPTCY COURT APPROVAL AND PROCEDURES
Section 13.1 Sale Order. Subject to the Seller's fiduciary
duties to their creditors, including their duties under
Section 363, the Seller agrees to support and shall use their
best efforts to obtain in timely fashion approval of this
transaction by the Bankruptcy Court under Sections 105 and 363 of
the Bankruptcy Code. The form of notice to creditors and parties
in interest of this transaction shall incorporate substantially
the material provisions of Sections 13.4 and 13.5 below.
Section 13.2 [Intentionally Omitted]
Section 13.3 Notice. Notice to creditors and parties in
interest shall include, inter alia, that any party in interest
objecting to this transaction shall file its objection in writing
on or before 5:00 p.m., three business days prior to the
scheduled hearing on this Agreement with the Clerk of the
Bankruptcy Court [INSERT ADDRESS], with a copy of its objection
delivered to (A) Debtor's counsel, [INSERT NAMES AND ADDRESSES]
and (B) Purchaser's counsel, [INSERT NAMES AND ADDRESSES]; and
that any party in interest that makes a Competing Bid (as
defined in this Agreement) shall file its Competing Bid in
writing on or before 5:00 p.m. three business days before the
scheduled hearing on this Agreement, with the Clerk of the
Bankruptcy Court [INSERT ADDRESS], with a copy of its Competing
Bid delivered to (A) Debtor's counsel, [INSERT NAMES AND
ADDRESSES] and (B) Purchaser's counsel, [INSERT NAMES AND
ADDRESSES]. During such three business day period, the Purchaser
may respond to any such Competing Bids.
Section 13.4 Competing Bid. In order to qualify for
consideration by the Bankruptcy Court as a higher and better
offer relating to this transaction (a "Competing Bid") from a
party in interest (a "Competing Bidder"), a Competing Bid shall
be reduced to writing, and: (i) provide for aggregate
consideration having a value greater than the sum of (A) the
Purchase Price and (B) $60,000; (ii) not be contingent upon
financing necessary to its consummation or the outcome of any
unperformed due diligence; and include a certified check payable
to Sellers equal to ten percent of the Competing Bid (the
"Competing Bid Deposit"); (iv) provide for a closing not later
than three weeks after the Bankruptcy Court approves the
Competing Bid; (v) provide that the Purchase Price shall be paid
in cash and/or marketable securities and (vi) provide for a
purchase of all the Stock of the Company provided, however, that
should a Competing Bidder or the Purchaser increase its
respective bid during the course of the hearing on this
Agreement, the determination of who has made the highest and best
offer shall not be affected by the necessity of immediately
increasing the bidder's deposit.
Section 13.5 Competing Bidders.(a)Any third-party that in
good faith requests of Sellers in writing an opportunity to
conduct due diligence to prepare and submit a Competing Bid (i)
shall be given complete access to public information; and (ii)
with respect to nonpublic information of a proprietary or
confidential nature, shall be given access for the sole purpose
of submitting a Competing Bid, provided that the Competing Bidder
first executes a confidentiality agreement, substantially in the
form of Exhibit R hereto (the "Confidentiality Agreement"), which
contains a provision in which the Competing Bidder is advised and
acknowledges that the Managers and Franco are members of the
Purchasing Group and submits to the jurisdiction of the
Bankruptcy Court for purposes of enforcement of such
Confidentiality Agreement.
(b) If a closing under an agreement with a successful
Competing Bidder is not timely concluded, the Seller shall be
authorized without further Bankruptcy Court Order promptly to
conclude the transaction with the next highest willing bidder in
accordance with the terms of the next highest Competing Bid
(provided the next highest Competing Bid otherwise complies with
this Agreement).
(c) Any and all Competing Bid Deposits submitted by
unsuccessful Competing Bidders shall be returned to their
respective Competing Bidder, unless the Competing Bidder shall
have been deemed to have been in default of its Competing Bid in
which case the Competing Bid Deposit shall be kept by the Seller.
IN WITNESS WHEREOF, Seller, Xxxx, Purchaser and ARTRA
have caused their corporate names to be hereunto subscribed by
their officers thereunto duly authorized, and Xxxxxx, Werner,
Paterek, Xxxxxxxxxx and Franco have signed as individuals
thereunto, all as of the day and year first above written.
SPECTRUM INFORMATION TECHNOLOGIES, INC.
By: /s/ Xxxxxx X. Xxxxxxx
Name: Xxxxxx X. Xxxxxxx
Title: Chief Executive Officer
THE XXXX CORPORATION
By: /s/ Xxxxx X. Xxxxxx
Name: Xxxxx X. Xxxxxx
Title: Director
COMFORCE CORP.
By: /s/ Xxxxxxxxxxx X. Xxxxxx
Name: Xxxxxxxxxxx X. Xxxxxx
Title: Vice President
ARTRA GROUP INCORPORATED
By: /s/ Xxxxx X. Xxxxxx
Name: Xxxxx X. Xxxxxx
Title: President
XXXXX X. XXXXXX
/s/ Xxxxx X. Xxxxxx
XXXX X. XXXXXX
/s/ Xxxx X. Xxxxxx
XXXXX X. XXXXXXX
/s/ Xxxxx X. Xxxxxxx
XXXXXXX XXXXXXXXXX
/s/ Xxxxxxx Xxxxxxxxxx
XXXXXXXXXXX X. XXXXXX
/s/ Xxxxxxxxxxx X. Xxxxxx
LIST OF OMITTED SCHEDULES
Schedule No. Contents of Omitted Schedule
Schedule 1.1 Closing Adjustment, Equipment and
Other Assets and Real Property
Leases
Schedule 2.5(b)(iii) Items to be Delivered at Closing
to Global from Spectrum, Items
the Ownership of Which Shall be
Transferred at Closing to Global
from Spectrum and Items not
Utilized by the Business and not
on Global's General Ledger to be
Transferred to Seller Pursuant to
Section 5.1(b)
Schedule 3.2 Property Ownership
Schedule 3.3 Authorized and Outstanding
Capitalization
Schedule 3.6 Finders Fees or Similar Payments
Schedule 3.7 Material Defaults by Company
under Material Agreements and
Material Claims, Actions, Suits,
Proceedings, Arbitrations,
Investigations or Inquiries
Schedule 3.9 Directors and Officers of the
Company
Schedule 3.10 Changes Since the Date of the
Most Recent Balance Sheets
Schedule 4.5 Liabilities of Seller and its
Affiliates
Spectrum Information Technologies, Inc. agrees to furnish
supplementally a copy of any omitted schedule to the Securities
and Exchange Commission upon request.
EXHIBIT A
FORM OF ESCROW AGREEMENT
ESCROW AGREEMENT dated as of September 11, 1995 among
Comforce Corp., The Xxxx Corporation, each a Delaware corporation
("Purchaser" and "Xxxx", respectively), and Spectrum Information
Technologies, Inc., a Delaware corporation ("Seller"), and
Cleary, Gottlieb, Xxxxx & Xxxxxxxx, as escrow agent (the "Escrow
Agent"). Capitalized terms used herein and not otherwise defined
shall have the meaning ascribed to such terms in the Stock
Purchase Agreement, dated as of the date hereof, by and among
Seller, Xxxx, Purchaser, ARTRA Group Incorporated, Xxxxx X.
Xxxxxx, Xxxx X. Xxxxxx, Xxxxx X. Xxxxxxx, Xxxxxxx Xxxxxxxxxx and
Xxxxxxxxxxx X. Xxxxxx (the "Stock Purchase Agreement").
WHEREAS, pursuant to Sections 2.2(a) and (b) of the
Stock Purchase Agreement, Purchaser is to deposit on the date
hereof a portion of the Purchase Price with the Escrow Agent, to
be held and released in accordance with the terms herein;
NOW, THEREFORE, in consideration of the premises and
the respective agreements hereinafter set forth, the parties
hereby agree as follows:
I. Appointment of Escrow Agent
The Escrow Agent is hereby appointed by Purchaser and
Seller and acknowledges its appointment and agrees to act as
agent for such parties under this Agreement, subject to the terms
and condition hereof.
II. Delivery of Funds
Contemporaneously with the execution and delivery of
this Agreement by all parties hereto, Purchaser shall deposit
with the Escrow Agent the sum of Five Hundred Thousand U.S.
Dollars ($500,000) to be held by the Escrow Agent in accordance
with the terms of this Agreement. The Escrow Agent hereby
acknowledges receipt of such funds. Any funds held from time to
time by the Escrow Agent pursuant to this Agreement (including
earnings thereon, if any) are hereinafter referred to as the
"Escrow Funds."
III. Investment of Escrow Funds
The Escrow Agent shall invest the Escrow Funds as
directed by Seller. If no direction by Seller is received by the
Escrow Agent, the Escrow Agent shall invest the Escrow Funds in
the Premium U.S. Treasury Reserves Landmark Funds account managed
by Citibank, N.A.
IV. Release of Escrow Funds
Section 4.1. The Escrow Agent shall release the Escrow
Funds, together with any and all interest earned on the Escrow
Funds from the date such amount was deposited with the Escrow
Agent up to the date of such release, to Seller three business
days after the Escrow Agent's (i) receipt from Seller of notice
of the failure of the conditions of Article VIII to be fulfilled
at the Closing Date and of a copy of the Bankruptcy Court
Approval Order or (ii) receipt of notice from Seller of
termination of the Stock Purchase Agreement pursuant to Section
10.1(b) of the Stock Purchase Agreement or (iii) receipt from
Seller of a copy of the Bankruptcy Court Approval Order and the
items listed in Article IX(c), (d), (g) and (h) of the Stock
Purchase Agreement or (iv) upon receipt of notice from Seller
that the Closing has occurred.
Section 4.2. The Escrow Agent shall release the Escrow
Funds, together with any and all interest earned on the Escrow
Funds from the date such amount was deposited with the Escrow
Agent up to the date of such release, to Purchaser three business
days after the Escrow Agent's (i) receipt from Purchaser of
notice of termination of the Stock Purchase Agreement pursuant to
Section 10.1(c), 10.1(d) or 10.3(b) of the Stock Purchase
Agreement or (ii) receipt from Purchaser of a copy of the
Bankruptcy Court Approval Order and of notice that the items
listed in Article IX(c), (d), (g) and (h) of the Stock Purchase
Agreement has not been received by it nor has it waived receipt
of such items and that the Closing has not occurred.
Section 4.3. The Escrow Agent shall release one-half
of the Escrow Funds, together with any and all interest earned on
such portion of the Escrow Funds, to each of the Purchaser and
Seller not later than three business days after receipt by the
Escrow Agent of notice from Purchaser of termination of the Stock
Purchase Agreement pursuant to Section 10.3(a) thereof.
Section 4.4. In the event that the Escrow Agent
receives any instrument in writing, signed by Purchaser and
Seller, directing the release of the Escrow Funds, the Escrow
Agent shall release the Escrow Funds in accordance with such
instrument. In the event that an order is entered by any court
of competent jurisdiction directing the Escrow Agent to release
the Escrow Funds, the Escrow Agent shall release the Escrow Funds
in accordance with such order. In the event of any dispute
regarding the release of the Escrow Funds, if Seller is
successful in such dispute, Purchaser and Xxxx shall be jointly
and severally responsible and shall indemnify Seller for its
reasonable legal fees, costs and expenses incurred in connection
therewith and, if Purchaser is successful in such dispute, Seller
shall pay the legal fees, costs and expenses of Xxxx and
Purchaser incurred in connection therewith.
Section 4.5. As of the date that the Escrow Agent has
delivered the Escrow Funds to Seller or Purchaser in accordance
with the provisions hereof, this Agreement shall terminate as to
the Escrow Agent, except that the provisions of Article V shall
survive such termination.
Section 4.6. Notwithstanding the foregoing provisions
of this Article IV, in the event that prior to the Escrow Agent's
release of the Escrow Funds pursuant to Sections 4.1 or 4.2
hereof, either Purchaser or Seller objects to such release by
notifying the Escrow Agent in writing of its objection and
specifying in detail the reasons therefor, the Escrow Agent shall
not so release the Escrow Funds.
V. Rights of the Escrow Agent
Section 5.1 The Escrow Agent shall have no duties or
responsibilities except those expressly set forth herein and
shall not be subject to, nor obliged to recognize, monitor or
enforce the terms of any other agreement between, or direction or
instruction of, Purchaser or Seller, even though reference
thereto may be made herein; provided, however, that these escrow
instructions may be amended at any time or times by an instrument
in writing signed by the parties hereto.
Section 5.2 The Escrow Agent is authorized, in its
sole discretion, to disregard any and all notices or instructions
given by any of the undersigned or by any other person, firm or
corporation, except only such notices or instructions as are
hereinabove provided for and orders or process of any court
entered or issued with or without jurisdiction. If any property
subject hereto is at any time attached, garnished, or levied upon
under any court order or in case the payment, assignment,
transfer, conveyance or delivery of any such property shall be
stayed or enjoined by any court order, or in case any order,
judgment or decree shall be made or entered by any court
affecting such property or any part thereof, then and in any of
such events the Escrow Agent is authorized, in its sole
discretion, to rely upon and comply with any such order, writ,
judgment or decree which it is so advised by legal counsel of its
own choosing is binding upon it, and if it complies with any such
order, writ, judgment or decree it shall not be liable to any of
the parties hereto or to any other person, firm or corporation by
reason of such compliance even though such order, writ, judgment
or decree may be subsequently reversed, modified, annulled, set
aside or vacated.
Section 5.3 The Escrow Agent may rely upon any
instrument in writing believed in good faith by it to be genuine
and sufficient and shall not be liable or responsible for any
action taken or omitted in accordance with the provisions
thereof.
Section 5.4 The Escrow Agent shall not be personally
liable for any act taken or omitted hereunder except for its
gross negligence, bad faith or willful misconduct.
Section 5.5 Purchaser, Xxxx and Seller (the
"Indemnifying Parties") hereby agree to be jointly and severally
liable for, and indemnify the Escrow Agent and hold it harmless
against any loss, liability, cost and expense (including
reasonable attorneys' fees) which may be imposed upon or incurred
by the Escrow Agent hereunder, except through the Escrow Agent's
own gross negligence, bad faith or willful misconduct. The
Escrow Agent shall notify the Indemnifying Parties promptly of
any claim for which it may seek indemnity, although the failure
to notify shall only excuse the obligations of an Indemnifying
Party hereunder to the extent that it prejudices the ability of
such Indemnifying Party to contest any such claim. The
Indemnifying Parties may contest the claim, and the Escrow Agent
shall cooperate in any such contest, in which case the Escrow
Agent may at its discretion have separate counsel, and the
Indemnifying Parties shall pay the reasonable fees and expenses
of such counsel. The Indemnifying Parties need not pay for any
settlement made without their consent.
Section 5.6 In the event of any disagreement between
any of the parties hereto resulting in adverse claims or demands
being made in connection with the subject matter of this
Agreement, or in the event that the Escrow Agent should be in
doubt as to what action it should take hereunder, the Escrow
Agent may, at its option, refuse to comply with any claims or
demands on it, or refuse to take any other action hereunder, so
long as such disagreement continues or such doubt exists, and in
any such event, the Escrow Agent shall not be or become liable
for damages, interest, or in any other way or to any person for
its failure or refusal to act, and the Escrow Agent shall be
entitled to continue so to refrain from acting until (a) the
rights of all parties shall have been fully and finally
adjudicated by a court of competent jurisdiction or by the mutual
agreement of Purchaser , Xxxx and Seller and (b) the Escrow Agent
shall have received appropriate evidence of the foregoing, in
which event the Escrow Agent shall release the Escrow Funds in
accordance with such adjudication or agreement, as the case may
be. In the alternative, the Escrow Agent, may, but shall not be
obligated to, file a suit in interpleader (the parties hereto
consenting to the filing of such action in the Bankruptcy Court
for the Eastern District of New York) for a declaratory judgment
for the purpose of having the respective rights of the parties
adjudicated, and may deposit with such court the Escrow Funds, in
which case Purchaser and Xxxx agree to pay all costs, expenses
and attorneys' fees incurred by the Escrow Agent in connection
therewith, the amount thereof to be fixed and such judgment
therefor to be rendered by the court in such suit.
Section 5.7 Purchaser and Xxxx acknowledge and agree
that the Escrow Agent has acted and will continue to act as
counsel to the Seller, including, without limitation, in
connection with any dispute arising hereunder.
VI. Miscellaneous Provisions
Section 6.1 Purchaser, Xxxx and Seller shall attempt
in good faith to resolve promptly any disputes arising hereunder.
Section 6.2 All notices, requests and other
communications required or permitted to be given hereunder shall
be in writing and shall be deemed given if delivered personally
(including by courier), given by prepaid telegram or mailed first
class, postage prepaid, registered or certified mail or via
Federal Express overnight delivery, addressed as follows:
(a) If to Seller:
Spectrum Information Technologies, Inc.
0000 Xxxxxxxxxxx Xxxxxx
Xxxxxxxx, Xxx Xxxx 00000
Attention: Xx. Xxxxxx X. Xxxxxxx
Fax: (000) 000-0000
with a copy to:
Cleary, Gottlieb, Xxxxx & Xxxxxxxx
Xxx Xxxxxxx Xxxxx, Xxxxx 0000
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxxxx, Esq.
Fax: (000) 000-0000
(b) If to Purchaser:
Comforce Corp.
The Xxxx Corporation
000 Xxxxxxx Xxxxxx
Xxxx Xxxxxx Xxx 0000
Xxxxxxxxxx, XX 00000-0000
Attention: Xx. Xxxxx X. Xxxxxx
Fax: (000) 000-0000
with a copy to:
Xxxx X. Xxxxxxxx
Attorney At Law
00 Xxxxxxx Xxxx, Xxxxx 0000
Xxxxxx, XX 00000
Attention: Xxxx X. Xxxxxxxx, Esq.
Fax: (000) 000-0000
(c) If to the Escrow Agent:
Cleary, Gottlieb, Xxxxx & Xxxxxxxx
Xxx Xxxxxxx Xxxxx, Xxxxx 0000
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx Xxxxx, Esq.
Fax: (000) 000-0000
Each of the foregoing shall be entitled to specify a
different address by giving notice as aforesaid to the others.
All notices, requests and other communications shall be
deemed to have been received at the time that they are actually
received, but not later than three days after delivery by mail.
Whenever under the terms hereof the time for giving a notice or
performing an act falls upon a Saturday, Sunday, or holiday, such
time shall be extended to the next business day. Purchaser and
Seller shall provide to each other any notice provided by either
to the Escrow Agent, using the same method of delivery.
Section 6.3 This Agreement may be executed in one or
more counterparts, each of which shall be deemed an original, but
all of which together shall constitute one and the same
instrument.
Section 6.4 This Agreement shall inure to the
benefit of and be binding upon the parties hereto and their
respective successors and assigns; provided, however, that any
assignment of this Agreement or the rights hereunder by any party
hereto without the written consent of the other parties shall be
void. Nothing in this Agreement, expressed or implied, is
intended to confer upon any other person any rights or remedies
under or by reason of this Agreement.
Section 6.5 This Agreement, and all matters relating
hereto, shall be governed by and construed and enforced in
accordance with the laws of the State of New York.
Section 6.6 No consent or waiver, expressed or
implied, by any party of any breach or default by any other in
the performance by the other of its obligations hereunder shall
be deemed or construed to be a consent or waiver to or of any
other breach or default in the performance by such party of the
same or any obligations of the party. Failure on the part of any
party to complain of any act or failure to act of the other party
or to declare the other party in default, irrespective of how
long such failure continues, shall not constitute a waiver by
that party of its rights under this Agreement or otherwise.
Section 6.7 No modification, amendment, waiver or
discharge of this Agreement shall bind any party unless in
writing and signed by or on behalf of such party.
Section 6.8 The Article captions used herein are for
reference purposes only, and shall not in any way affect the
meaning or interpretation of this Agreement.
Section 6.9 This Agreement contains the entire
understanding of the parties hereto with respect to the subject
matter contained herein and supersedes all prior agreements,
correspondence, conversations, negotiations and understandings
between the parties with respect to such subject matter.
Section 6.10 As used in this Agreement, any gender
includes a reference to all other genders and the singular
includes a reference to the plural and vice versa.
IN WITNESS WHEREOF, the parties hereto have duly
executed this Agreement as of the date first above written.
SPECTRUM INFORMATION
TECHNOLOGIES, INC.
By ____________________________
Name: Xxxxxx X. Xxxxxxx
Title: Chief Executive Officer
COMFORCE CORP.
By ____________________________
Name: Xxxxxxxxxxx X. Xxxxxx
Title: Vice President
THE XXXX CORPORATION
By ____________________________
Name: Xxxxx X. Xxxxxx
Title: Director
CLEARY, GOTTLIEB, XXXXX & XXXXXXXX
as Escrow Agent
By _____________________________
Xxxxxx Xxxxx, a Partner
EXHIBIT B
FORM OF GUARANTEE
Spectrum Information Technologies, Inc.
0000 Xxxxxxxxxxx Xxx.
Xxxxxxxx, XX 00000
Ladies and Gentlemen:
I refer to the Stock Purchase Agreement, dated
September 11, 1995, by and among Spectrum Information
Technologies, Inc., a corporation organized under the laws of the
State of Delaware ("Seller"), and The Xxxx Corporation, a
corporation organized under the laws of the State of Delaware
("Xxxx"), Comforce Corp., a corporation organized under the laws
of the State of Delaware ("Purchaser"), ARTRA Group Incorporated,
a corporation organized under the laws of the State of Delaware,
Xxxxx X. Xxxxxx ("Xxxxxx"), Xxxx X. Xxxxxx, Xxxxx X. Xxxxxxx,
Xxxxxxx Xxxxxxxxxx, and Xxxxxxxxxxx X. Xxxxxx (the "Stock
Purchase Agreement"). Terms used herein and not otherwise
defined herein shall have the meanings assigned thereto in the
Stock Purchase Agreement.
To induce you to enter into the Stock Purchase
Agreement, the undersigned, Xxxxxx, a director of Xxxx, hereby
guarantees pursuant to Section 2.2(c) of the Stock Purchase
Agreement the prompt, full and complete payment when due in
accordance with the Stock Purchase Agreement on the Closing Date
of the Closing Payment of Five Million Five Hundred Thousand U.S.
Dollars ($5,500,000), subject to the Closing Adjustments, if any,
and hereby agrees to pay such amount in full immediately upon
demand in immediately available funds by federal funds check or
certified check or bank wire to an account designated by Seller
in the event such Closing Payment is not paid to Seller on the
Closing Date by Purchaser. Also, pursuant to Section 2.2(c) of
the Stock Purchase Agreement, the undersigned attaches financial
statements for a period ending no earlier than four (4) months
prior to the date hereof.
The liability of the undersigned under this Guarantee
shall be irrevocable and unconditional, and shall not be subject
to any reduction, limitation, impairment or termination for any
reason, irrespective of any circumstance which might otherwise
constitute a defense, setoff, counterclaim or recoupment
available to, or a discharge of, as a matter of law or equity,
any member of the Purchasing Group, including the undersigned.
Notwithstanding anything to the contrary contained in
this Guarantee, it is understood and agreed that the Guarantor's
obligation will arise only upon the satisfaction or waiver of all
contractual conditions precedent to the Purchaser's obligation to
pay the Purchase Price pursuant to the Stock Purchase Agreement.
The undersigned hereby represents and warrants to
Seller that he has the capacity to enter into and deliver this
Guarantee and to perform its obligations hereunder.
The undersigned hereby represents and warrants to
Seller that this Guarantee has been duly and validity executed
and delivered by the undersigned and this Guarantee constitutes a
valid, binding and enforceable agreement of the undersigned.
THIS GUARANTEE SHALL BE GOVERNED BY THE LAWS OF THE
STATE OF NEW YORK.
This Guarantee is made for your benefit and the
benefit of any permitted assignee of your rights under the Stock
Purchase Agreement.
The undersigned hereby waives diligence, presentment,
demand of payment, filing of claims with a court in the event of
insolvency or bankruptcy of Purchaser or any other member of the
Purchasing Group, any right to require a proceeding first against
Purchaser or any other member of the Purchasing Group to meet
such member's obligations, protest and notice, and all demands
whatsoever and covenants that this Guarantee will not be
discharged except by complete performance of the obligations
contained in this Guarantee.
The undersigned hereby waives and releases all rights
of subrogation against Purchaser or any other member of the
Purchasing Group and such member's property and all rights of
indemnification, contribution and reimbursement from Purchaser or
any other member of the Purchasing Group and such member's
property, in each case in connection with this Guarantee and any
payments made hereunder, and regardless of whether such rights
arise by operation of law, pursuant to contract or otherwise;
provided, however that such waiver and release will expire one
year and one day after the complete and indefeasible payment in
full of the Purchase Price (adjusted by the Closing Adjustments)
by the Purchaser, unless at such time any of the Purchaser or any
Guarantor is the subject of a bankruptcy, insolvency or similar
proceeding.
Seller acknowledges that the Guarantor's obligations
hereunder shall also be discharged by the complete and
indefeasible payment in full of the Purchase Price (adjusted by
the Closing Adjustments) by the Purchaser.
______________________________
Xxxxx X. Xxxxxx
Director, The Xxxx Corporation
Solely in respect of its acknowledgment in the last
paragraph hereof.
SPECTRUM INFORMATION
TECHNOLOGIES, INC.
By: __________________________
Xxxxxx X. Xxxxxxx
Chief Executive Officer
EXHIBIT C
FORM OF GUARANTEE
Spectrum Information Technologies, Inc.
0000 Xxxxxxxxxxx Xxx.
Xxxxxxxx, XX 00000
Ladies and Gentlemen:
I refer to the Stock Purchase Agreement, dated
September 11, 1995, by and among Spectrum Information
Technologies, Inc., a corporation organized under the laws of the
State of Delaware ("Seller") and The Xxxx Corporation, a
corporation organized under the laws of the State of Delaware,
Comforce Corp., a corporation organized under the laws of the
State of Delaware ("Purchaser"), ARTRA Group Incorporated, a
corporation organized under the laws of the State of Delaware,
Xxxxx X. Xxxxxx, Xxxx X. Xxxxxx ("Xxxxxx"), Xxxxx X. Xxxxxxx,
Xxxxxxx Xxxxxxxxxx, and Xxxxxxxxxxx X. Xxxxxx (the "Stock
Purchase Agreement"). Terms used herein and not otherwise
defined herein shall have the meanings assigned thereto in the
Stock Purchase Agreement.
To induce you to enter into the Stock Purchase
Agreement, the undersigned, Xxxxxx, hereby guarantees
pursuant to Section 2.2(c) of the Stock Purchase Agreement the
prompt, full and complete payment when due in accordance with the
Stock Purchase Agreement on the Closing Date of the Closing
Payment of Five Million Five Hundred Thousand U.S. Dollars
($5,500,000), subject to the Closing Adjustments, if any, and
hereby agrees to pay such amount in full immediately upon demand
in immediately available funds by federal funds check or
certified check or bank wire to an account designated by Seller
in the event such Closing Payment is not paid to Seller on the
Closing Date by Purchaser.
The liability of the undersigned under this Guarantee
shall be irrevocable and unconditional, and shall not be subject
to any reduction, limitation, impairment or termination for any
reason, irrespective of any circumstance which might otherwise
constitute a defense, setoff, counterclaim or recoupment
available to, or a discharge of, as a matter of law or equity,
any member of the Purchasing Group, including the undersigned.
Notwithstanding anything to the contrary contained in
this Guarantee, it is understood and agreed that the Guarantor's
obligation will arise only upon the satisfaction or waiver of all
contractual conditions precedent to the Purchaser's obligation to
pay the Purchase Price pursuant to the Stock Purchase Agreement.
The undersigned hereby represents and warrants to
Seller that he has the capacity to enter into and deliver this
Guarantee and to perform its obligations hereunder.
The undersigned hereby represents and warrants to
Seller that this Guarantee has been duly and validity executed
and delivered by the undersigned and this Guarantee constitutes a
valid, binding and enforceable agreement of the undersigned.
THIS GUARANTEE SHALL BE GOVERNED BY THE LAWS OF THE
STATE OF NEW YORK.
This Guarantee is made for your benefit and the benefit
of any permitted assignee of your rights under the Stock Purchase
Agreement.
The undersigned hereby waives diligence, presentment,
demand of payment, filing of claims with a court in the event of
insolvency or bankruptcy of Purchaser or any other member of the
Purchasing Group, any right to require a proceeding first against
Purchaser or any other member of the Purchasing Group to meet
such member's obligations, protest and notice, and all demands
whatsoever and covenants that this Guarantee will not be
discharged except by complete performance of the obligations
contained in this Guarantee.
The undersigned hereby waives and releases all rights
of subrogation against Purchaser or any other member of the
Purchasing Group and such member's property and all rights of
indemnification, contribution and reimbursement from Purchaser or
any other member of the Purchasing Group and such member's
property, in each case in connection with this Guarantee and any
payments made hereunder, and regardless of whether such rights
arise by operation of law, pursuant to contract or otherwise;
provided, however that such waiver and release will expire one
year and one day after the complete and indefeasible payment in
full of the Purchase Price (adjusted by the Closing Adjustments)
by the Purchaser, unless at such time any of the Purchaser or any
Guarantor is the subject of a bankruptcy, insolvency or similar
proceeding.
Seller acknowledges that the Guarantor's obligations
hereunder shall also be discharged by the complete and
indefeasible payment in full of the Purchase Price (adjusted by
the Closing Adjustments) by the Purchaser.
_________________________________
Xxxx X. Xxxxxx
Solely in respect of its acknowledgment in the last
paragraph hereof.
SPECTRUM INFORMATION
TECHNOLOGIES, INC.
By: ____________________________
Xxxxxx X. Xxxxxxx
Chief Executive Officer
EXHIBIT E
FORM OF GUARANTEE
Spectrum Information Technologies, Inc.
0000 Xxxxxxxxxxx Xxx.
Xxxxxxxx, XX 00000
Ladies and Gentlemen:
We refer to the Stock Purchase Agreement, dated as of
the date hereof, by and among Spectrum Information Technologies,
Inc., a corporation organized under the laws of the State of
Delaware ("Seller") and The Xxxx Corporation, a corporation
organized under the laws of the State of Delaware ("Xxxx"),
Comforce Corp., a corporation organized under the laws of the
State of Delaware ("Purchaser"), ARTRA Group Incorporated, a
corporation organized under the laws of the State of Delaware,
Xxxxx X. Xxxxxx, Xxxx X. Xxxxxx, Xxxxx X. Xxxxxxx, Xxxxxxx
Xxxxxxxxxx, and Xxxxxxxxxxx X. Xxxxxx (the "Stock Purchase
Agreement"). Terms used herein and not otherwise defined herein
shall have the meanings assigned thereto in the Stock Purchase
Agreement.
To induce you to enter into the Stock Purchase
Agreement, the undersigned, Xxxx, hereby guarantees pursuant to
Section 2.2(c) of the Stock Purchase Agreement the prompt, full
and complete payment when due in accordance with the Stock
Purchase Agreement on the Closing Date of the Closing Payment of
Five Million Five Hundred Thousand U.S. Dollars ($5,500,000),
subject to the Closing Adjustments, if any, and hereby agrees to
pay such amount in full immediately upon demand in immediately
available funds by federal funds check or certified check or bank
wire to an account designated by Seller in the event such Closing
Payment is not paid to Seller on the Closing Date by Purchaser.
Also, pursuant to Section 2.2(c) of the Stock Purchase Agreement,
the undersigned attaches financial statements for a period ending
no earlier than four (4) months prior to the date hereof.
The liability of the undersigned under this Guarantee
shall be irrevocable and unconditional, and shall not be subject
to any reduction, limitation, impairment or termination for any
reason, irrespective of any circumstance which might otherwise
constitute a defense, setoff, counterclaim or recoupment
available to, or a discharge of, as a matter of law or equity,
any member of the Purchasing Group, including the undersigned.
Notwithstanding anything to the contrary contained in
this Guarantee, it is understood and agreed that the Guarantor's
obligation will arise only upon the satisfaction or waiver of all
contractual conditions precedent to the Purchaser's obligation to
pay the Purchase Price pursuant to the Stock Purchase Agreement.
The undersigned hereby represents and warrants to
Seller that it has the capacity to enter into and deliver this
Guarantee and to perform its obligations hereunder.
The undersigned hereby represents and warrants to
Seller that this Guarantee has been duly and validity executed
and delivered by the undersigned and this Guarantee constitutes a
valid, binding and enforceable agreement of the undersigned.
THIS GUARANTEE SHALL BE GOVERNED BY THE LAWS OF THE
STATE OF NEW YORK.
This Guarantee is made for your benefit and the benefit
of any permitted assignee of your rights under the Stock Purchase
Agreement.
The undersigned hereby waives diligence, presentment,
demand of payment, filing of claims with a court in the event of
insolvency or bankruptcy of Purchaser or any other member of the
Purchasing Group, any right to require a proceeding first against
Purchaser or any other member of the Purchasing Group to meet
such member's obligations, protest and notice, and all demands
whatsoever and covenants that this Guarantee will not be
discharged except by complete performance of the obligations
contained in this Guarantee.
The undersigned hereby waives and releases all rights
of subrogation against Purchaser or any other member of the
Purchasing Group and such member's property and all rights of
indemnification, contribution and reimbursement from Purchaser or
any other member of the Purchasing Group and such member's
property, in each case in connection with this Guarantee and any
payments made hereunder, and regardless of whether such rights
arise by operation of law, pursuant to contract or otherwise;
provided, however that such waiver and release will expire one
year and one day after the complete and indefeasible payment in
full of the Purchase Price (adjusted by the Closing Adjustments)
by the Purchaser, unless at such time any of the Purchaser or any
Guarantor is the subject of a bankruptcy, insolvency or similar
proceeding.
Seller acknowledges that the Guarantor's obligations
hereunder shall also be discharged by the complete and
indefeasible payment in full of the Purchase Price (adjusted by
the Closing Adjustments) by the Purchaser.
THE XXXX CORPORATION
_____________________________
By: Xxxxx X. Xxxxxx
Title: Director
Solely in respect of its acknowledgment in the last
paragraph hereof.
SPECTRUM INFORMATION
TECHNOLOGIES, INC.
By: _________________________
Xxxxxx X. Xxxxxxx
Chief Executive Officer
EXHIBIT F
FORM OF GUARANTEE
Spectrum Information Technologies, Inc.
0000 Xxxxxxxxxxx Xxx.
Xxxxxxxx, XX 00000
Ladies and Gentlemen:
We refer to the Stock Purchase Agreement, dated as of
the date hereof, by and among Spectrum Information Technologies,
Inc., a corporation organized under the laws of the State of
Delaware ("Seller") and The Xxxx Corporation, a corporation
organized under the laws of the State of Delaware, Comforce
Corp., a corporation organized under the laws of the State of
Delaware ("Purchaser"), ARTRA Group Incorporated, a corporation
organized under the laws of the State of Delaware ("ARTRA"),
Xxxxx X. Xxxxxx, Xxxx X. Xxxxxx, Xxxxx X. Xxxxxxx, Xxxxxxx
Xxxxxxxxxx, and Xxxxxxxxxxx X. Xxxxxx (the "Stock Purchase
Agreement"). Terms used herein and not otherwise defined herein
shall have the meanings assigned thereto in the Stock Purchase
Agreement.
To induce you to enter into the Stock Purchase
Agreement, the undersigned, ARTRA, hereby guarantees pursuant to
Section 2.2(c) of the Stock Purchase Agreement the prompt, full
and complete payment when due in accordance with the Stock
Purchase Agreement on the Closing Date of the Closing Payment of
Five Million Five Hundred Thousand U.S. Dollars ($5,500,000),
subject to the Closing Adjustments, if any, and hereby agrees to
pay such amount in full immediately upon demand in immediately
available funds by federal funds check or certified check or bank
wire to an account designated by Seller in the event such Closing
Payment is not paid to Seller on the Closing Date by Purchaser.
Also, pursuant to Section 2.2(c) of the Stock Purchase Agreement,
the undersigned attaches financial statements for a period ending
no earlier than four (4) months prior to the date hereof.
The liability of the undersigned under this Guarantee
shall be irrevocable and unconditional, and shall not be subject
to any reduction, limitation, impairment or termination for any
reason, irrespective of any circumstance which might otherwise
constitute a defense, setoff, counterclaim or recoupment
available to, or a discharge of, as a matter of law or equity,
any member of the Purchasing Group, including the undersigned.
Notwithstanding anything to the contrary contained in
this Guarantee, it is understood and agreed that the Guarantor's
obligation will arise only upon the satisfaction or waiver of all
contractual conditions precedent to the Purchaser's obligation to
pay the Purchase Price pursuant to the Stock Purchase Agreement.
The undersigned hereby represents and warrants to
Seller that it has the capacity to enter into and deliver this
Guarantee and to perform its obligations hereunder.
The undersigned hereby represents and warrants to
Seller that this Guarantee has been duly and validity executed
and delivered by the undersigned and this Guarantee constitutes a
valid, binding and enforceable agreement of the undersigned.
THIS GUARANTEE SHALL BE GOVERNED BY THE LAWS OF THE
STATE OF NEW YORK.
This Guarantee is made for your benefit and the benefit
of any permitted assignee of your rights under the Stock Purchase
Agreement.
The undersigned hereby waives diligence, presentment,
demand of payment, filing of claims with a court in the event of
insolvency or bankruptcy of Purchaser or any other member of the
Purchasing Group, any right to require a proceeding first against
Purchaser or any other member of the Purchasing Group to meet
such member's obligations, protest and notice, and all demands
whatsoever and covenants that this Guarantee will not be
discharged except by complete performance of the obligations
contained in this Guarantee.
The undersigned hereby waives and releases all rights
of subrogation against Purchaser or any other member of the
Purchasing Group and such member's property and all rights of
indemnification, contribution and reimbursement from Purchaser or
any other member of the Purchasing Group and such member's
property, in each case in connection with this Guarantee and any
payments made hereunder, and regardless of whether such rights
arise by operation of law, pursuant to contract or otherwise;
provided, however that such waiver and release will expire one
year and one day after the complete and indefeasible payment in
full of the Purchase Price (adjusted by the Closing Adjustments)
by the Purchaser, unless at such time any of the Purchaser or any
Guarantor is the subject of a bankruptcy, insolvency or similar
proceeding.
Seller acknowledges that the Guarantor's obligations
hereunder shall also be discharged by the complete and
indefeasible payment in full of the Purchase Price (adjusted by
the Closing Adjustments) by the Purchaser.
ARTRA GROUP INCORPORATED
_____________________________
By: Xxxxx X. Xxxxxx
Title: President
Solely in respect of its acknowledgment in the last
paragraph hereof.
SPECTRUM INFORMATION
TECHNOLOGIES, INC.
By: _________________________
Xxxxxx X. Xxxxxxx
Chief Executive Officer
EXHIBIT H
FORM OF CERTIFICATION THAT AN ENTITY TRANSFEROR
IS NOT A FOREIGN PERSON
Section 1445 of the Internal Revenue Code provides that
a transferee of a U.S. real property interest must withhold tax
if the transferor is a foreign person. To inform the transferee
that withholding of tax is not required upon the disposition of a
U.S. real property interest by Spectrum Information Technologies,
Inc. ("Seller"), the undersigned hereby certifies the following
on behalf of Seller:
1. Seller is not a foreign corporation, foreign
partnership, foreign trust, or foreign estate (as those terms are
defined in the Internal Revenue Code and Income Tax Regulations);
2. Seller's U.S. employer identification number is 75-
1940923; and
3. Seller's office address is:
0000 Xxxxxxxxxxx Xxxxxx
Xxxxxxxx, Xxx Xxxx 00000
Seller understands that this certification may be
disclosed to the Internal Revenue Service by the transferee and
that any false statement contained herein could be punished by
fine, imprisonment, or both.
Under penalties of perjury I declare that I have
examined this certification and to the best of my knowledge and
belief it is true, correct, and complete, and I further declare
that I have authority to sign this document on behalf of Seller.
SPECTRUM INFORMATION TECHNOLOGIES, INC.
Date: __________ ______________________________________
Name: Xxxxxx X. Xxxxxxx
Title: Chief Executive Officer
EXHIBIT I
FORM OF GENERAL RELEASE AND WAIVER OF XXXXXX X. XXXXXXX
This General Release and Waiver is dated as of the 17th
day of October, 1995, among Xxxxxx X. Xxxxxxx, a resident of the
State of New York ("Xxxxxxx"), Spectrum Information Technologies,
Inc., a corporation organized under the laws of the State of
Delaware ("Spectrum") and Spectrum Global Services, Inc.
("Global"), a corporation organized under the laws of the State
of Delaware.
WHEREAS, Xxxxxxx and Spectrum have entered into that
certain employment agreement, dated January 1, 1995 (the
"Spectrum Employment Agreement"), pursuant to which Spectrum may
have incurred, and may in the future incur, certain obligations
to Xxxxxxx;
WHEREAS, the Spectrum Employment Agreement provides for
the employment of Xxxxxxx by Spectrum, and Xxxxxxx has been an
employee of Spectrum since January 1, 1995;
WHEREAS, Global has entered into that certain guaranty
of the full and faithful performance and payment by Spectrum of
the Spectrum Employment Agreement (the "Guaranty of Employment
Agreement"), pursuant to which Global may have incurred, and may
in the future incur, certain obligations to Xxxxxxx;
WHEREAS, Spectrum has entered into a Stock Purchase
Agreement, dated September 11, 1995 (the "Stock Purchase
Agreement") by and among Spectrum, The Xxxx Corporation, Comforce
Corp. ("Purchaser"), ARTRA Group Incorporated, Xxxxx X. Xxxxxx,
Xxxx X. Xxxxxx, Xxxxx X. Xxxxxxx, Xxxxxxx Xxxxxxxxxx and
Xxxxxxxxxxx X. Xxxxxx, under which Spectrum agrees to sell and
Purchaser agrees to purchase all of the outstanding capital stock
of Global; and
WHEREAS, in consideration of the mutual agreements and
covenants set forth in the Stock Purchase Agreement, Xxxxxxx
desires to release Global from the Guaranty of Employment
Agreement on the terms and conditions set forth below;
NOW, THEREFORE, for good and valuable consideration,
the receipt of which is hereby acknowledged, the parties hereto
hereby agree as follows:
I. GENERAL RELEASE AND WAIVER
XXXXXXX AGREES TO RELEASE, REMISE, ACQUIT AND DISCHARGE
GLOBAL AND ITS OFFICERS, AGENTS, EMPLOYEES, GUARANTORS,
CONSULTANTS, INDEPENDENT CONTRACTORS, ATTORNEYS, ADVISERS,
SUCCESSORS AND ASSIGNS (THE "GLOBAL GROUP"), JOINTLY AND
SEVERALLY, FROM ANY AND ALL CLAIMS, KNOWN OR UNKNOWN, WHICH
XXXXXXX, HIS HEIRS, SUCCESSORS, OR ASSIGNS HAVE, OR MAY NOW OR IN
THE FUTURE HAVE, AGAINST ANY MEMBER OF THE GLOBAL GROUP AND ANY
AND ALL LIABILITY WHICH ANY MEMBER OF THE GLOBAL GROUP HAS, OR
MAY NOW OR IN THE FUTURE HAVE TO XXXXXXX UNDER THE GUARANTY OF
EMPLOYMENT AGREEMENT, WHETHER DENOMINATED CLAIMS, DEMANDS, CAUSES
OF ACTION, OBLIGATIONS, DAMAGES OR LIABILITIES, RELATING TO ANY
MATTER, CAUSE OR THING WHATSOEVER FROM THE BEGINNING OF THE WORLD
TO THE DATE OF THIS GENERAL RELEASE AND WAIVER. THIS RELEASE IS
FOR ANY RELIEF, NO MATTER HOW DENOMINATED, INCLUDING, BUT NOT
LIMITED TO, WAGES, BACK PAY, FRONT PAY, COMPENSATORY DAMAGES OR
PUNITIVE DAMAGES. XXXXXXX FURTHER AGREES THAT HE WILL NOT FILE
OR PERMIT TO BE FILED ON HIS BEHALF ANY SUCH CLAIM.
SPECTRUM RELEASES THE GLOBAL GROUP FROM ANY LIABILITY
OR CLAIM IT HAS AGAINST THE GLOBAL GROUP TO ENFORCE THE
OBLIGATIONS OF THE GLOBAL GROUP UNDER THE GUARANTY OF EMPLOYMENT
AGREEMENT.
II. Identified Consideration
Xxxxxxx acknowledges and agrees that Purchaser has
agreed to enter into the Stock Purchase Agreement, a requirement
of which is his release evidenced hereby, and that Purchaser's
entering into the Stock Purchase Agreement is good and valuable
consideration for such release. In addition, Xxxxxxx represents
and warrants that he has not transferred or assigned any rights
under the Guaranty of Employment Agreement to any third party.
III. Third-Party Beneficiary Rights
Xxxxxxx agrees that the terms of this General Release
and Waiver shall inure to the benefit of and shall be enforceable
by each member of the Global Group, each of whom is intended to
be a third-party beneficiary hereof, and its respective
successors and assigns.
IV. General Provisions
(a) This General Release and Waiver constitutes the
entire understanding of Global and Xxxxxxx with respect to the
subject matter hereof, and supersedes all prior understandings,
written or oral, except as expressly provided herein. The terms
of this General Release and Waiver may be changed, modified or
discharged only by an instrument in writing signed by the parties
hereto. A failure of a party to insist on strict compliance with
any provision of this General Release and Waiver shall not be
deemed a waiver of such provision or any other provision hereof.
In the event that any provision of this General Release and
Waiver is determined to be so broad as to be unenforceable, such
provision shall be interpreted to be only so broad as is
enforceable.
(b) This General Release and Waiver shall be
construed, enforced and interpreted in accordance with and
governed by the laws of the State of New York without reference
to the principles of conflicts of law. The courts of New York
shall have jurisdiction to entertain any action arising
hereunder.
V. Knowing and Voluntary Waiver
Xxxxxxx agrees and acknowledges that he has read this
General Release and Waiver, has consulted with an attorney of his
choosing with respect hereto and completely understands the terms
and consequences hereof and that the execution of this General
Release and Waiver is his knowing, free and voluntary act.
_____________________________
Xxxxxx X. Xxxxxxx
SPECTRUM GLOBAL SERVICES, INC.
By: _________________________
Name: Xxxxxx X. Xxxxxxx
Title: Chief Executive Officer
SPECTRUM INFORMATION
TECHNOLOGIES, INC.
By: _________________________
Name: Xxxxxx X. Xxxxxxx
Title: Chief Executive Officer
EXHIBIT J
FORM OF GENERAL RELEASE AND WAIVER OF
GORDIAN GROUP, L.P. AND OTHERS
This General Release and Waiver is made as of the 17th
day of October, 1995, among Gordian Group, L.P. ("Gordian"),
Spectrum Global Services, Inc. ("Global"), Spectrum Information
Technologies, Inc. ("Spectrum"), Spectrum Cellular Corporation
("Spectrum Cellular") and Dealer Service Business Systems, Inc.
("Data One"), each a corporation organized under the laws of the
State of Delaware (all parties other than Global, the "Releasing
Persons").
WHEREAS, Gordian, Spectrum, Global, Spectrum Cellular
and Data One have entered into that certain engagement letter,
dated as of February 15, 1995 (the "Engagement Letter"), pursuant
to which Global may have incurred, and may in the future incur,
certain obligations to Gordian;
WHEREAS, the Engagement Letter provides for the
engagement of Gordian by Spectrum, and Gordian has been financial
advisor to Spectrum since the Bankruptcy Court approved of
Gordian's retention on April 4, 1995;
WHEREAS, the Engagement Letter provides for Global's
guarantee of all of Spectrum's obligations under the Engagement
Letter;
WHEREAS, Spectrum has entered into a Stock Purchase
Agreement, dated as of September 11, 1995, with The Xxxx
Corporation, Comforce Corp. ("Purchaser"),' ARTRA Group
Incorporated, Xxxxx X. Xxxxxx, Xxxx X. Xxxxxx, Xxxxx X. Xxxxxxx,
Xxxxxxx Xxxxxxxxxx and Xxxxxxxxxxx X. Xxxxxx (the "Stock Purchase
Agreement") under which Spectrum agrees to sell and Purchaser
agrees to purchase all of the outstanding capital stock of
Global; and
WHEREAS, Gordian has been requested to release Global
from its guarantee, pursuant to this General Release and Waiver,
on the terms and conditions set forth below;
NOW, THEREFORE, effective upon, and only upon,
Bankruptcy Court approval of Gordian's requested fees in respect
of the sale of Global, the parties hereto hereby agree as
follows:
I. GENERAL RELEASE AND WAIVER
THE RELEASING PERSONS AGREE THEY WILL RELEASE, REMISE,
ACQUIT AND DISCHARGE GLOBAL AND ITS OFFICERS, AGENTS, EMPLOYEES,
CONSULTANTS, INDEPENDENT CONTRACTORS, ATTORNEYS, ADVISERS,
SUCCESSORS AND ASSIGNS (THE "GLOBAL GROUP"), AND ONLY THE GLOBAL
GROUP, JOINTLY AND SEVERALLY, FROM ANY AND ALL CLAIMS, KNOWN OR
UNKNOWN, WHICH THEY, THEIR SUCCESSORS OR ASSIGNS HAVE, OR MAY NOW
OR IN THE FUTURE HAVE, AGAINST ANY MEMBER OF THE GLOBAL GROUP AND
ANY AND ALL LIABILITY WHICH ANY MEMBER OF THE GLOBAL GROUP HAS,
OR MAY NOW OR IN THE FUTURE HAVE TO THE RELEASING PERSONS,
WHETHER DENOMINATED CLAIMS, DEMANDS, CAUSES OF ACTION,
OBLIGATIONS, DAMAGES OR LIABILITIES, ARISING UNDER THE ENGAGEMENT
LETTER RELATING TO ANY MATTER, CAUSE OR THING WHATSOEVER FROM THE
BEGINNING OF THE WORLD TO THE DATE OF THIS GENERAL RELEASE AND
WAIVER. THIS RELEASE IS FOR ANY RELIEF, NO MATTER HOW
DENOMINATED. THE RELEASING PERSONS FURTHER AGREE THAT THEY WILL
NOT FILE OR PERMIT TO BE FILED ON THEIR BEHALF ANY SUCH CLAIM.
II. No Admission
Global admits no liability of any sort to any of the
Releasing Persons and nothing herein is intended to, or shall be
deemed to, constitute an admission of liability of any kind by
any member of the Global Group.
III. Third-Party Beneficiary Rights
The Releasing Persons agree that the terms of this
General Release and Waiver shall inure to the benefit of and
shall be enforceable by each member of the Global Group, each of
whom is intended to be a third-party beneficiary hereof, and its
respective successors and assigns.
IV. Other Matters
Spectrum agrees to indemnify Global for any actual
damages incurred by Global as a direct result of the failure of
Computer Bay to release Global from its guarantee of the
Engagement Letter.
V. General Provisions
(a) This General Release and Waiver constitutes the
entire understanding of Global and the Releasing Persons with
respect to the subject matter hereof, and supersedes all prior
understandings, written or oral, except as expressly provided
herein. The terms of this General Release and Waiver may be
changed, modified or discharged only by an instrument in writing
signed by the parties hereto. A failure of a party to insist on
strict compliance with any provision of this General Release and
Waiver shall not be deemed a waiver of such provision or any
other provision hereof. In the event that any provision of this
General Release and Waiver is determined to be so broad as to be
unenforceable, such provision shall be interpreted to be only so
broad as is enforceable.
(b) This General Release and Waiver shall be
construed, enforced and interpreted in accordance with and
governed by the laws of the State of New York without reference
to the principles of conflicts of law. The courts of New York
shall have jurisdiction to entertain any action arising
hereunder.
VI. Knowing and Voluntary Waiver
The Releasing Persons agree and acknowledge that they
have read this General Release and Waiver, consulted with an
attorney of their choosing with respect hereto and completely
understands the terms and consequences hereof and that the
execution of this General Release and Waiver is their knowing,
free and voluntary act.
GORDIAN GROUP, L.P.
By: __________________________________
Name: Xxxxx X. Xxxxxxx
Title: Partner
SPECTRUM INFORMATION TECHNOLOGIES, INC.
By: __________________________________
Name: Xxxxxx X. Xxxxxxx
Title: Chief Executive Officer
SPECTRUM CELLULAR CORPORATION, INC.
By: __________________________________
Name: Xxxxxx X. Xxxxxxx
Title: Chief Executive Officer
DEALER SERVICES BUSINESS SYSTEMS, INC.
By: __________________________________
Name: Xxxxxx X. Xxxxxxx
Title: Chief Executive Officer
EXHIBIT K
FORM OF MUTUAL RELEASE AND WAIVER BETWEEN
SPECTRUM GLOBAL SERVICES INC. AND XXXXXX X. XXXXXXX
This Mutual Release and Waiver is made as of the 9th
day of October, 1995, between Xxxxxx X. Xxxxxxx ("Xxxxxxx") and
Spectrum Global Services, Inc. ("Global").
WHEREAS, Sandler and Global have entered into an
Employment Agreement, dated May 31, 1995 (the "Global Employment
Agreement"), pursuant to which Global may have incurred, and may
in the future incur, certain obligations to Sandler;
WHEREAS, the Global Employment Agreement provides for
the employment of Sandler by Global, and Sandler has been an
employee of Global, effective June 1, 1995;
WHEREAS, Sandler may have incurred certain obligations
to Global in connection with his service as an employee of
Global;
WHEREAS, Spectrum Information Technologies, Inc.
("Spectrum") has entered into a Stock Purchase Agreement, dated
as of September 11, 1995, with The Xxxx Corporation, Comforce
Corp. ("Purchaser"), ARTRA Group Incorporated, Xxxxx X. Xxxxxx,
Xxxx X. Xxxxxx, Xxxxx X. Xxxxxxx, Xxxxxxx Xxxxxxxxxx and
Xxxxxxxxxxx X. Xxxxxx (the "Stock Purchase Agreement") under
which Spectrum agrees to sell and Purchaser agrees to purchase
all of the outstanding capital stock of Global; and
WHEREAS, Sandler and Spectrum have entered into an
Employment Agreement, dated as of the date hereof (the "Spectrum
Employment Agreement") and, in consideration of the mutual
agreements and covenants set forth therein and herein, Sandler
desires to release Global, and Global desires to release Sandler,
from the Global Employment Agreement on the terms and conditions
of this Mutual Release and Waiver;
NOW, THEREFORE, for good and valuable consideration,
the receipt of which is hereby acknowledged, the parties hereto
hereby agree as follows:
I. MUTUAL RELEASE AND WAIVER
SANDLER AGREES TO RELEASE, REMISE, ACQUIT AND DISCHARGE
GLOBAL AND ITS OFFICERS, AGENTS, EMPLOYEES, GUARANTORS,
CONSULTANTS, INDEPENDENT CONTRACTORS, ATTORNEYS, ADVISERS,
SUCCESSORS AND ASSIGNS (THE "GLOBAL GROUP"), JOINTLY AND
SEVERALLY, FROM ANY AND ALL CLAIMS, KNOWN OR UNKNOWN, WHICH
SANDLER, HIS HEIRS, SUCCESSORS, OR ASSIGNS HAVE, OR MAY NOW OR IN
THE FUTURE HAVE, AGAINST ANY MEMBER OF THE GLOBAL GROUP AND ANY
AND ALL LIABILITY WHICH ANY MEMBER OF THE GLOBAL GROUP HAS, OR
MAY NOW OR IN THE FUTURE HAVE TO SANDLER, WHETHER DENOMINATED
CLAIMS, DEMANDS, CAUSES OF ACTION, OBLIGATIONS, DAMAGES OR
LIABILITIES, ARISING FROM ANY AND ALL BASES, INCLUDING BUT NOT
LIMITED TO ANY CLAIMS UNDER ANY POLICY, AGREEMENT, ARRANGEMENT OR
PRACTICE OF OR WITH ANY MEMBER OF THE GLOBAL GROUP (INCLUDING ANY
INDEMNIFICATION AGREEMENT OR OBLIGATION) OR ANY FEDERAL, STATE,
OR LOCAL LAW OR REGULATION, RELATING TO ANY MATTER, CAUSE OR
THING WHATSOEVER FROM THE BEGINNING OF THE WORLD TO THE DATE OF
THIS MUTUAL RELEASE AND WAIVER, INCLUDING, WITHOUT LIMITATION,
ANY SUCH CLAIMS THAT ARISE OUT OF OR RELATE TO (I) SANDLER'S
RELATIONSHIP WITH THE GLOBAL GROUP, (II) THE TERMINATION OF SUCH
RELATIONSHIP OR (III) THE EMPLOYMENT AGREEMENT, BUT EXCLUDING ANY
CLAIMS FOR INDEMNIFICATION UNDER THE EMPLOYMENT AGREEMENT OR THE
BY-LAWS OF GLOBAL. THIS RELEASE IS FOR ANY RELIEF, NO MATTER HOW
DENOMINATED, INCLUDING, BUT NOT LIMITED TO, WAGES, BACK PAY,
FRONT PAY, COMPENSATORY DAMAGES OR PUNITIVE DAMAGES. SANDLER
FURTHER AGREES THAT HE WILL NOT FILE OR PERMIT TO BE FILED ON HIS
BEHALF ANY SUCH CLAIM.
THE GLOBAL GROUP AGREES TO RELEASE, REMISE, ACQUIT AND
DISCHARGE SANDLER AND HIS HEIRS, SUCCESSORS AND ASSIGNS (THE
"SANDLER GROUP"), JOINTLY AND SEVERALLY, FROM ANY AND ALL CLAIMS,
KNOWN OR UNKNOWN, WHICH THE GLOBAL GROUP HAS, OR MAY NOW OR IN
THE FUTURE HAVE, AGAINST ANY MEMBER OF THE SANDLER GROUP AND ANY
AND ALL LIABILITY WHICH ANY MEMBER OF THE SANDLER GROUP HAS, OR
MAY NOW OR IN THE FUTURE HAVE TO THE GLOBAL GROUP, WHETHER
DENOMINATED CLAIMS, DEMANDS, CAUSES OF ACTION, OBLIGATIONS,
DAMAGES OR LIABILITIES, ARISING FROM ANY AND ALL BASES, INCLUDING
BUT NOT LIMITED TO ANY CLAIMS UNDER ANY POLICY, AGREEMENT OR
ARRANGEMENT OR ANY FEDERAL, STATE, OR LOCAL LAW OR REGULATION,
RELATING TO ANY MATTER, CAUSE OR THING WHATSOEVER FROM THE
BEGINNING OF THE WORLD TO THE DATE OF THIS MUTUAL RELEASE AND
WAIVER. THIS RELEASE IS FOR ANY RELIEF, NO MATTER HOW
DENOMINATED. THE GLOBAL GROUP FURTHER AGREES THAT IT WILL NOT
FILE OR PERMIT TO BE FILED ON ITS BEHALF ANY SUCH CLAIM.
II. Identified Consideration
Sandler and Global each acknowledge that they have
entered into this Mutual Release and Waiver and Sandler
acknowledges and agrees that Spectrum, and Global acknowledges
and agrees that Sandler, has entered into the Spectrum Employment
Agreement, in consideration for the mutual release evidenced
hereby and that such consideration is good and valuable
consideration for such release.
III. No Admission
(a) Global admits no liability of any sort to Sandler,
and nothing herein is intended to, or shall be deemed to,
constitute an admission of liability of any kind by the Global
Group.
(b) Sandler admits no liability of any sort to Global,
and nothing herein is intended to, or shall be deemed to,
constitute an admission of liability of any kind by Sandler.
IV. Third-Party Beneficiary Rights
Sandler agrees that the terms of this Mutual Release
and Waiver shall inure to the benefit of and shall be enforceable
by each member of the Global Group, each of whom is intended to
be a third-party beneficiary hereof, and its respective
successors and assigns.
V. General Provisions
(a) This Mutual Release and Waiver constitutes the
entire understanding of Global and Sandler with respect to the
subject matter hereof, and supersedes all prior understandings,
written or oral, except as expressly provided herein. The terms
of this Mutual Release and Waiver may be changed, modified or
discharged only by an instrument in writing signed by the parties
hereto. A failure of a party to insist on strict compliance with
any provision of this Mutual Release and Waiver shall not be
deemed a waiver of such provision or any other provision hereof.
In the event that any provision of this Mutual Release and Waiver
is determined to be so broad as to be unenforceable, such
provision shall be interpreted to be only so broad as is
enforceable.
(b) This Mutual Release and Waiver shall be construed,
enforced and interpreted in accordance with and governed by the
laws of the State of New York without reference to the principles
of conflicts of law. The courts of New York shall have
jurisdiction to entertain any action arising hereunder.
(c) Sandler acknowledges that he has been given more
than 21 days to consider this agreement and eight days to revoke
his agreement hereto. This agreement shall only become effective
upon the Closing (as such term is defined in the Stock Purchase
Agreement).
VI. Knowing and Voluntary Waiver
Sandler and Global each agree and acknowledge that they
have read this Mutual Release and Waiver, have consulted with an
attorney of his or its choosing with respect hereto and
completely understands the terms and consequences hereof and that
the execution of this Mutual Release and Waiver is his or its
knowing, free and voluntary act.
_________________________________
Xxxxxx X. Xxxxxxx
SPECTRUM GLOBAL SERVICES, INC.
_________________________________
By: Xxxxxx X. Xxxxxxx,
Chief Executive Officer
EXHIBIT M
FORM OF MUTUAL RELEASE AND WAIVER BETWEEN
SPECTRUM INFORMATION TECHNOLOGIES, INC. AND XXXXX X. XXXXXXX
This Mutual Release and Waiver is made as of the 17th
day of October, 1995, between Xxxxx X. Xxxxxxx, a resident of the
State of New York, ("Xxxxxxx") and Spectrum Information
Technologies, Inc. ("Spectrum"), a corporation organized under
the laws of the State of Delaware.
WHEREAS, Xxxxxxx and Spectrum have entered into an
Employment Agreement, dated as of October 31, 1993, as amended to
date (the "Employment Agreement"), pursuant to which Spectrum may
have incurred, and may in the future incur, certain obligations
to Xxxxxxx;
WHEREAS, the Employment Agreement provides for the
employment of Xxxxxxx by Spectrum, and Xxxxxxx has been an
employee of Spectrum, since October 31, 1993;
WHEREAS, Spectrum and its Affiliates (as such term is
defined in the Stock Purchase Agreement, dated September 11, 1995
by and among Spectrum and The Xxxx Corporation, a corporation
organized under the laws of the State of Delaware ("Xxxx"),
Comforce Corp., a corporation organized under the laws of the
State of Delaware ("Purchaser"), ARTRA Group Incorporated, a
corporation organized under the laws of the State of Delaware,
Xxxxx X. Xxxxxx, Xxxx X. Werner, Paterek, Xxxxxxx Xxxxxxxxxx, and
Xxxxxxxxxxx X. Xxxxxx (the "Stock Purchase Agreement"), may have
incurred, and may in the future incur, certain obligations to
Xxxxxxx in connection with Xxxxxxx'x employment by Spectrum;
WHEREAS, Xxxxxxx has accepted an offer to become an
employee of, or consultant to, Xxxx upon the consummation of the
transactions contemplated by the Stock Purchase Agreement;
WHEREAS, pursuant to the Stock Purchase Agreement,
Spectrum has agreed to sell and Purchaser has agreed to purchase
all of the issued and outstanding shares of capital stock of
Spectrum Global Services, Inc. ("Global");
WHEREAS, Xxxxxxx may have incurred certain obligations
to Spectrum and its Affiliates in connection with his service as
an employee of Spectrum, in connection with his being an officer
of Global or in connection with his membership on the Board of
Directors of Spectrum; and
WHEREAS, Spectrum's obligations under the Stock
Purchase Agreement are subject to the execution by Xxxxxxx, and
Xxxxxxx'x obligations under the Stock Purchase Agreement are
subject to the execution by Spectrum, of this Mutual Release and
Waiver;
NOW, THEREFORE, for good and valuable consideration,
the receipt of which is hereby acknowledged, the parties hereto
hereby agree as follows:
I. MUTUAL RELEASE AND WAIVER
XXXXXXX AGREES TO RELEASE, REMISE, ACQUIT AND DISCHARGE
SPECTRUM AND ITS AFFILIATES AND THEIR OFFICERS, DIRECTORS,
AGENTS, EMPLOYEES, SHAREHOLDERS, CONSULTANTS, INDEPENDENT
CONTRACTORS, ATTORNEYS, ADVISERS, SUCCESSORS AND ASSIGNS (THE
"SPECTRUM GROUP"), JOINTLY AND SEVERALLY, FROM ANY AND ALL
CLAIMS, KNOWN OR UNKNOWN, WHICH XXXXXXX, HIS HEIRS, SUCCESSORS,
OR ASSIGNS HAVE, OR MAY NOW OR IN THE FUTURE HAVE, AGAINST ANY
MEMBER OF THE SPECTRUM GROUP AND ANY AND ALL LIABILITY WHICH ANY
MEMBER OF THE SPECTRUM GROUP HAS, OR MAY NOW OR IN THE FUTURE
HAVE TO XXXXXXX, WHETHER DENOMINATED CLAIMS, DEMANDS, CAUSES OF
ACTION, OBLIGATIONS, DAMAGES OR LIABILITIES, ARISING FROM ANY AND
ALL BASES, INCLUDING BUT NOT LIMITED TO ANY CLAIMS UNDER ANY
POLICY, AGREEMENT, ARRANGEMENT OR PRACTICE OF OR WITH ANY MEMBER
OF THE SPECTRUM GROUP (INCLUDING ANY INDEMNIFICATION AGREEMENT OR
OBLIGATION) OR ANY FEDERAL, STATE, OR LOCAL LAW OR REGULATION,
RELATING TO ANY MATTER, CAUSE OR THING WHATSOEVER FROM THE
BEGINNING OF THE WORLD TO THE DATE OF THIS MUTUAL RELEASE AND
WAIVER, INCLUDING, WITHOUT LIMITATION, ANY SUCH CLAIMS THAT ARISE
OUT OF OR RELATE TO (I) ANY EVENT OCCURRING IN WHOLE OR IN PART
PRIOR TO SPECTRUM'S ACQUISITION OF GLOBAL ON OCTOBER 31, 1993,
(II) XXXXXXX'X RELATIONSHIP WITH THE SPECTRUM GROUP, THE
TERMINATION OF SUCH RELATIONSHIP OR THE PURCHASE, OWNERSHIP AND
SALE BY SPECTRUM OF GLOBAL, (III) THE EMPLOYMENT AGREEMENT OR
(IV) THE PENDING INDICTMENT OF XXXXXXX IN THE U.S. DISTRICT COURT
FOR THE EASTERN DISTRICT OF NEW YORK, EXCEPT FOR ANY CLAIM WHICH
XXXXXXX MAY HAVE FOR INDEMNIFICATION FOR LIABILITY RELATING TO
CIVIL CORPORATE MATTERS OF SPECTRUM IN WHICH XXXXXXX IS INVOLVED
BECAUSE HE WAS AN OFFICER OF GLOBAL OR A DIRECTOR OF SPECTRUM OR
IS ALLEGED TO HAVE BEEN AN OFFICER OF SPECTRUM (UNLESS A COURT
DETERMINES THAT XXXXXXX WAS AN ACTIVE PARTICIPANT IN THE EVENT
GIVING RISE TO SUCH CLAIM). THIS RELEASE IS FOR ANY RELIEF, NO
MATTER HOW DENOMINATED, INCLUDING, BUT NOT LIMITED TO, WAGES,
BACK PAY, FRONT PAY, COMPENSATORY DAMAGES OR PUNITIVE DAMAGES.
XXXXXXX FURTHER AGREES THAT HE WILL NOT FILE OR PERMIT TO BE
FILED ON HIS BEHALF ANY SUCH CLAIM.
THE SPECTRUM GROUP AGREES TO RELEASE, REMISE, ACQUIT
AND DISCHARGE XXXXXXX AND HIS HEIRS, SUCCESSORS AND ASSIGNS (THE
"XXXXXXX GROUP"), JOINTLY AND SEVERALLY, FROM ANY AND ALL CLAIMS,
KNOWN OR UNKNOWN, WHICH THE SPECTRUM GROUP HAS, OR MAY NOW OR IN
THE FUTURE HAVE, AGAINST ANY MEMBER OF THE XXXXXXX GROUP AND ANY
AND ALL LIABILITY WHICH ANY MEMBER OF THE XXXXXXX GROUP HAS, OR
MAY NOW OR IN THE FUTURE HAVE TO THE SPECTRUM GROUP, WHETHER
DENOMINATED CLAIMS, DEMANDS, CAUSES OF ACTION, OBLIGATIONS,
DAMAGES OR LIABILITIES, ARISING FROM ANY AND ALL BASES, INCLUDING
BUT NOT LIMITED TO ANY CLAIMS UNDER ANY POLICY, AGREEMENT OR
ARRANGEMENT OR ANY FEDERAL, STATE, OR LOCAL LAW OR REGULATION,
RELATING TO ANY MATTER, CAUSE OR THING WHATSOEVER FROM THE
BEGINNING OF THE WORLD TO THE DATE OF THIS MUTUAL RELEASE AND
WAIVER, EXCEPT FOR ANY CLAIMS, KNOWN OR UNKNOWN, WHICH THE
SPECTRUM GROUP HAS, OR MAY NOW OR IN THE FUTURE HAVE, AGAINST ANY
MEMBER OF THE XXXXXXX GROUP ARISING UNDER SECTION 6.2, 6.4, 11.4,
12.3 OR 12.16 OF THE STOCK PURCHASE AGREEMENT AND EXCEPT AS
PROVIDED IN ARTICLE III HEREIN. THIS RELEASE IS FOR ANY RELIEF,
NO MATTER HOW DENOMINATED. THE SPECTRUM GROUP FURTHER AGREES
THAT IT WILL NOT FILE OR PERMIT TO BE FILED ON ITS BEHALF ANY
SUCH CLAIM. NOTHING CONTAINED IN THIS MUTUAL RELEASE AND WAIVER
WILL LIMIT THE EFFECT OF SECTION 11.9 OF THE STOCK PURCHASE
AGREEMENT.
II. Identified Consideration
Xxxxxxx acknowledges and agrees that Spectrum, and
Spectrum acknowledges and agrees that Xxxxxxx, has entered into
the Stock Purchase Agreement in consideration for the mutual
release evidenced hereby, and that Spectrum's and Xxxxxxx'x
entering into the Stock Purchase Agreement is good and valuable
consideration for such release.
III. Acknowledgment Regarding Certain Agreements
Xxxxxxx acknowledges and agrees that his obligations
under Sections 6 and 8(g) of the Employment Agreement between
Spectrum and Xxxxxxx with respect to the business of the Spectrum
Group (excluding Global) shall continue in effect in accordance
with their terms following the date hereof. Xxxxxxx further
agrees that such obligations shall be incorporated herein and
made a part hereof as if repeated herein and that Spectrum's
agreement to enter into the Stock Purchase Agreement constitutes
additional consideration for his agreement to be bound by such
obligations.
IV. Certain Statutory Benefits
Spectrum agrees that Xxxxxxx may be entitled under
applicable U.S. federal or state law to exercise continuation of
coverage or conversion rights under certain insurance and other
welfare plans of Spectrum. This Mutual Release and Waiver does
not and is not intended to diminish his rights and entitlements
under any such plans.
V. No Admission
(a) Spectrum admits no liability of any sort to
Xxxxxxx and nothing herein is intended to, or shall be deemed to,
constitute an admission of liability of any kind by any member of
the Spectrum Group.
(b) Xxxxxxx admits no liability of any sort to
Spectrum and nothing herein is intended to, or shall be deemed
to, constitute an admission of liability of any kind by any
member of the Xxxxxxx Group.
VI. Third-Party Beneficiary Rights
Xxxxxxx agrees that the terms of this Mutual Release
and Waiver shall inure to the benefit of and shall be enforceable
by each member of the Spectrum Group, each of whom is intended to
be a third-party beneficiary hereof, and its respective
successors and assigns. Spectrum agrees that the terms of this
Mutual Release and Waiver shall inure to the benefit of and be
enforceable by each member of the Xxxxxxx Group, each of whom is
intended to be a third-party beneficiary hereof, and its
respective successors and assigns.
VII. General Provisions
(a) This Mutual Release and Waiver constitutes the
entire understanding of Xxxxxxx and Spectrum with respect to the
subject matter hereof, and supersedes all prior understandings,
written or oral, except as expressly provided herein. The terms
of this Mutual Release and Waiver may be changed, modified or
discharged only by an instrument in writing signed by the parties
hereto. A failure of a party to insist on strict compliance with
any provision of this Mutual Release and Waiver shall not be
deemed a waiver of such provision or any other provision hereof.
In the event that any provision of this Mutual Release and Waiver
is determined to be so broad as to be unenforceable, such
provision shall be interpreted to be only so broad as is
enforceable.
(b) This Mutual Release and Waiver shall be construed,
enforced and interpreted in accordance with and governed by the
laws of the State of New York without reference to the principles
of conflicts of law. The courts of New York shall have
jurisdiction to entertain any action arising hereunder.
VIII. Knowing and Voluntary Waiver
Xxxxxxx and Spectrum each agrees and acknowledges that
they have read this Mutual Release and Waiver, have consulted
with an attorney of his or its choosing with respect hereto and
completely understands the terms and consequences hereof and that
the execution of this Mutual Release and Waiver is his or its
knowing, free and voluntary act.
_____________________________________
Xxxxx X. Xxxxxxx
SPECTRUM INFORMATION TECHNOLOGIES, INC.
_____________________________________
By: Xxxxxx X. Xxxxxxx,
Chief Executive Officer
EXHIBIT N
FORM OF MUTUAL RELEASE AND WAIVER BETWEEN SPECTRUM
INFORMATION TECHNOLOGIES, INC. AND XXXXXXX XXXXXXXXXX
This Mutual Release and Waiver is made as of the 17th
day of October, 1995, between Xxxxxxx Xxxxxxxxxx, a resident of
the State of New York, ("Xxxxxxxxxx") and Spectrum Information
Technologies, Inc. ("Spectrum"), a corporation organized under
the laws of the State of Delaware.
WHEREAS, Xxxxxxxxxx and Spectrum have entered into an
Employment Agreement, dated as of October 31, 1993[, as amended
to date] (the "Employment Agreement"), pursuant to which Spectrum
may have incurred, and may in the future incur, certain
obligations to Xxxxxxxxxx;
WHEREAS, the Employment Agreement provides for the
employment of Xxxxxxxxxx by Spectrum, and Xxxxxxxxxx has been an
employee of Spectrum, since October 31, 1993;
WHEREAS, Spectrum and its Affiliates (as such term is
defined in the Stock Purchase Agreement, dated September 11, 1995
by and among Spectrum and The Xxxx Corporation, a corporation
organized under the laws of the State of Delaware ("Xxxx"),
COMFORCE Corporation, a corporation organized under the laws of
the State of Delaware ("Purchaser"), ARTRA Group Incorporated, a
corporation organized under the laws of the State of Delaware,
Xxxxx X. Xxxxxx, Xxxx X. Xxxxxx, Xxxxx X. Paterek, Ferrentino,
and Xxxxxxxxxxx X. Xxxxxx (the "Stock Purchase Agreement"), may
have incurred, and may in the future incur, certain obligations
to Xxxxxxxxxx in connection with Xxxxxxxxxx'x employment by
Spectrum;
WHEREAS, Xxxxxxxxxx has accepted an offer to become an
employee of or consultant to Xxxx upon the consummation of the
transactions contemplated by the Stock Purchase Agreement;
WHEREAS, Xxxxxxxxxx may have incurred certain
obligations to Spectrum and its Affiliates in connection with his
service as an employee of Spectrum or in connection with his
being an officer of Spectrum Global Services, Inc. ("Global");
WHEREAS, pursuant to the Stock Purchase Agreement,
Spectrum has agreed to sell and Purchaser has agreed to purchase
all of the issued and outstanding shares of capital stock of
Global; and
WHEREAS, Spectrum's obligations under the Stock
Purchase Agreement are subject to the execution by Xxxxxxxxxx,
and Xxxxxxxxxx'x obligations under the Stock Purchase Agreement
are subject to the execution by Spectrum, of this Mutual Release
and Waiver;
NOW, THEREFORE, for good and valuable consideration,
the receipt of which is hereby acknowledged, the parties hereto
hereby agree as follows:
I. MUTUAL RELEASE AND WAIVER
XXXXXXXXXX AGREES TO RELEASE, REMISE, ACQUIT AND
DISCHARGE SPECTRUM AND ITS AFFILIATES AND THEIR OFFICERS,
DIRECTORS, AGENTS, EMPLOYEES, SHAREHOLDERS, CONSULTANTS,
INDEPENDENT CONTRACTORS, ATTORNEYS, ADVISERS, SUCCESSORS AND
ASSIGNS (THE "SPECTRUM GROUP"), JOINTLY AND SEVERALLY, FROM ANY
AND ALL CLAIMS, KNOWN OR UNKNOWN, WHICH XXXXXXXXXX, HIS HEIRS,
SUCCESSORS, OR ASSIGNS HAVE, OR MAY NOW OR IN THE FUTURE HAVE,
AGAINST ANY MEMBER OF THE SPECTRUM GROUP AND ANY AND ALL
LIABILITY WHICH ANY MEMBER OF THE SPECTRUM GROUP HAS, OR MAY NOW
OR IN THE FUTURE HAVE TO XXXXXXXXXX, WHETHER DENOMINATED CLAIMS,
DEMANDS, CAUSES OF ACTION, OBLIGATIONS, DAMAGES OR LIABILITIES,
ARISING FROM ANY AND ALL BASES, INCLUDING BUT NOT LIMITED TO ANY
CLAIMS UNDER ANY POLICY, AGREEMENT, ARRANGEMENT OR PRACTICE OF OR
WITH ANY MEMBER OF THE SPECTRUM GROUP (INCLUDING ANY
INDEMNIFICATION AGREEMENT OR OBLIGATION) OR ANY FEDERAL, STATE,
OR LOCAL LAW OR REGULATION, RELATING TO ANY MATTER, CAUSE OR
THING WHATSOEVER FROM THE BEGINNING OF THE WORLD TO THE DATE OF
THIS MUTUAL RELEASE AND WAIVER, INCLUDING, WITHOUT LIMITATION,
ANY SUCH CLAIMS THAT ARISE OUT OF OR RELATE TO (I) ANY EVENT
OCCURRING IN WHOLE OR IN PART PRIOR TO SPECTRUM'S ACQUISITION OF
GLOBAL ON OCTOBER 31, 1993, (II) XXXXXXXXXX'X RELATIONSHIP WITH
THE SPECTRUM GROUP, THE TERMINATION OF SUCH RELATIONSHIP OR THE
PURCHASE, OWNERSHIP AND SALE BY SPECTRUM OF GLOBAL OR (III) THE
EMPLOYMENT AGREEMENT, EXCEPT FOR ANY CLAIM WHICH XXXXXXXXXX MAY
HAVE FOR INDEMNIFICATION FOR LIABILITY RELATING TO CIVIL
CORPORATE MATTERS OF SPECTRUM IN WHICH XXXXXXXXXX IS INVOLVED
BECAUSE HE WAS AN OFFICER OF GLOBAL OR IS ALLEGED TO HAVE BEEN AN
OFFICER OF SPECTRUM (UNLESS A COURT DETERMINES THAT XXXXXXXXXX
WAS AN ACTIVE PARTICIPANT IN THE EVENT GIVING RISE TO SUCH
CLAIM). THIS RELEASE IS FOR ANY RELIEF, NO MATTER HOW
DENOMINATED, INCLUDING, BUT NOT LIMITED TO, WAGES, BACK PAY,
FRONT PAY, COMPENSATORY DAMAGES OR PUNITIVE DAMAGES. XXXXXXXXXX
FURTHER AGREES THAT HE WILL NOT FILE OR PERMIT TO BE FILED ON HIS
BEHALF ANY SUCH CLAIM.
THE SPECTRUM GROUP AGREES TO RELEASE, REMISE, ACQUIT
AND DISCHARGE XXXXXXXXXX AND HIS HEIRS, SUCCESSORS AND ASSIGNS
(THE "XXXXXXXXXX GROUP"), JOINTLY AND SEVERALLY, FROM ANY AND ALL
CLAIMS, KNOWN OR UNKNOWN, WHICH THE SPECTRUM GROUP HAS, OR MAY
NOW OR IN THE FUTURE HAVE, AGAINST ANY MEMBER OF THE XXXXXXXXXX
GROUP AND ANY AND ALL LIABILITY WHICH ANY MEMBER OF THE
XXXXXXXXXX GROUP HAS, OR MAY NOW OR IN THE FUTURE HAVE TO THE
SPECTRUM GROUP, WHETHER DENOMINATED CLAIMS, DEMANDS, CAUSES OF
ACTION, OBLIGATIONS, DAMAGES OR LIABILITIES, ARISING FROM ANY AND
ALL BASES, INCLUDING BUT NOT LIMITED TO ANY CLAIMS UNDER ANY
POLICY, AGREEMENT OR ARRANGEMENT OR ANY FEDERAL, STATE, OR LOCAL
LAW OR REGULATION, RELATING TO ANY MATTER, CAUSE OR THING
WHATSOEVER FROM THE BEGINNING OF THE WORLD TO THE DATE OF THIS
MUTUAL RELEASE AND WAIVER, EXCEPT FOR ANY CLAIMS, KNOWN OR
UNKNOWN, WHICH THE SPECTRUM GROUP HAS, OR MAY NOW OR IN THE
FUTURE HAVE, AGAINST ANY MEMBER OF THE XXXXXXXXXX GROUP ARISING
UNDER SECTION 6.2, 6.4, 11.4. 12.3 OR 12.16 OF THE STOCK PURCHASE
AGREEMENT AND EXCEPT AS PROVIDED IN ARTICLE III HEREIN. THIS
RELEASE IS FOR ANY RELIEF, NO MATTER HOW DENOMINATED. THE
SPECTRUM GROUP FURTHER AGREES THAT IT WILL NOT FILE OR PERMIT TO
BE FILED ON ITS BEHALF ANY SUCH CLAIM. NOTHING CONTAINED IN THIS
MUTUAL RELEASE AND WAIVER WILL LIMIT THE EFFECT OF SECTION 11.9
OF THE STOCK PURCHASE AGREEMENT.
II. Identified Consideration
Xxxxxxxxxx acknowledges and agrees that Spectrum, and
Spectrum acknowledges and agrees that Xxxxxxxxxx, has entered
into the Stock Purchase Agreement in consideration for the mutual
release evidenced hereby, and that Spectrum's and Xxxxxxxxxx'x
entering into the Stock Purchase Agreement is good and valuable
consideration for such release.
III. Acknowledgement Regarding Certain Agreements
Xxxxxxxxxx acknowledges and agrees that his obligations
under Sections 6 and 8(g) of the Employment Agreement between
Spectrum and Xxxxxxxxxx with respect to the business of the
Spectrum Group (excluding Global) shall continue in effect in
accordance with their terms following the date hereof.
Xxxxxxxxxx further agrees that such obligations shall be
incorporated herein and made a part hereof as if repeated herein
and that Spectrum's agreement to enter into the Stock Purchase
Agreement constitutes additional consideration for his agreement
to be bound by such obligations.
IV. Certain Statutory Benefits
Spectrum agrees that Xxxxxxxxxx may be entitled under
applicable U.S. federal or state law to exercise continuation of
coverage or conversion rights under certain insurance and other
welfare plans of Spectrum. This Mutual Release and Waiver does
not and is not intended to diminish his rights and entitlements
under any such plans.
V. No Admission
(a) Spectrum admits no liability of any sort to
Xxxxxxxxxx and nothing herein is intended to, or shall be deemed
to, constitute an admission of liability of any kind by any
member of the Spectrum Group.
(b) Xxxxxxxxxx admits no liability of any sort to
Spectrum and nothing herein is intended to, or shall be deemed
to, constitute an admission of liability of any kind by any
member of the Spectrum Group.
VI. Third-Party Beneficiary Rights
Xxxxxxxxxx agrees that the terms of this Mutual Release
and Waiver shall inure to the benefit of and shall be enforceable
by each member of the Spectrum Group, each of whom is intended to
be a third-party beneficiary hereof, and its respective
successors and assigns. Spectrum agrees that the terms of this
Mutual Release and Waiver shall inure to the benefit of and shall
be enforceable by each member of the Xxxxxxxxxx Group, each of
whom is intended to be a third-party beneficiary hereof, and its
respective successors and assigns.
VII. General Provisions
(a) This Mutual Release and Waiver constitutes the
entire understanding of Spectrum and Xxxxxxxxxx with respect to
the subject matter hereof, and supersedes all prior
understandings, written or oral, except as expressly provided
herein. The terms of this Mutual Release and Waiver may be
changed, modified or discharged only by an instrument in writing
signed by the parties hereto. A failure of a party to insist on
strict compliance with any provision of this Mutual Release and
Waiver shall not be deemed a waiver of such provision or any
other provision hereof. In the event that any provision of this
Mutual Release and Waiver is determined to be so broad as to be
unenforceable, such provision shall be interpreted to be only so
broad as is enforceable.
(b) This Mutual Release and Waiver shall be construed,
enforced and interpreted in accordance with and governed by the
laws of the State of New York without reference to the principles
of conflicts of law. The courts of New York shall have
jurisdiction to entertain any action arising hereunder.
VIII. Knowing and Voluntary Waiver
Xxxxxxxxxx and Spectrum each agree and acknowledge that
they have read this Mutual Release and Waiver, have consulted
with an attorney of his or its choosing with respect hereto and
completely understands the terms and consequences hereof and that
the execution of this Mutual Release and Waiver is his or its
knowing, free and voluntary act.
______________________________________
Xxxxxxx Xxxxxxxxxx
SPECTRUM INFORMATION TECHNOLOGIES, INC.
______________________________________
By: Xxxxxx X. Xxxxxxx,
Chief Executive Officer
EXHIBIT O
FORM OF MUTUAL RELEASE AND WAIVER BETWEEN SPECTRUM
INFORMATION TECHNOLOGIES INC. AND XXXXXXXXXXX X. XXXXXX
This Mutual Release and Waiver is made as of the 17th
day of October, 1995, between Xxxxxxxxxxx X. Xxxxxx, a resident
of the State of Connecticut, ("Franco") and Spectrum Information
Technologies, Inc. ("Spectrum"), a corporation organized under
the laws of the State of Delaware.
WHEREAS, Franco and Spectrum have entered into an
Employment Agreement, dated October 29, 1993, as amended to date
(the "Employment Agreement"), pursuant to which Spectrum may have
incurred, and may in the future incur, certain obligations to
Franco;
WHEREAS, the Employment Agreement provides for the
employment of Franco by Spectrum, and Franco has been an employee
of Spectrum, since November 15, 1993;
WHEREAS, Spectrum and its Affiliates (as such term is
defined in the Stock Purchase Agreement, dated September 11, 1995
by and among Spectrum and The Xxxx Corporation, a corporation
organized under the laws of the State of Delaware ("Xxxx"),
COMFORCE Corporation, a corporation organized under the laws of
the State of Delaware ("Purchaser"), ARTRA Group Incorporated, a
corporation organized under the laws of the State of Delaware,
Xxxxx X. Xxxxxx, Xxxx X. Xxxxxx, Xxxxx X. Xxxxxxx, Xxxxxxx
Xxxxxxxxxx, and Xxxxxx (the "Stock Purchase Agreement"), may have
incurred, and may in the future incur, certain obligations to
Franco in connection with Franco's employment by Spectrum;
WHEREAS, Franco has accepted an offer to become an
employee of or consultant to Xxxx upon the consummation of the
transactions contemplated by the Stock Purchase Agreement;
WHEREAS, Franco may have incurred certain obligations
to Spectrum and its Affiliates in connection with his service as
an employee of Spectrum or in connection with his being an
officer of Spectrum;
WHEREAS, pursuant to the Stock Purchase Agreement,
Spectrum has agreed to sell and Purchaser has agreed to purchase
all of the issued and outstanding shares of capital stock of
Spectrum Global Services, Inc. ("Global"); and
WHEREAS, Spectrum's obligations under the Stock
Purchase Agreement are subject to the execution by Franco, and
Franco's obligations under the Stock Purchase Agreement are
subject to the execution by Spectrum, of this Mutual Release and
Waiver;
NOW, THEREFORE, for good and valuable consideration,
the receipt of which is hereby acknowledged, the parties hereto
hereby agree as follows:
I. MUTUAL RELEASE AND WAIVER
FRANCO AGREES TO RELEASE, REMISE, ACQUIT AND DISCHARGE
SPECTRUM AND ITS AFFILIATES AND THEIR OFFICERS, DIRECTORS,
AGENTS, EMPLOYEES, SHAREHOLDERS, CONSULTANTS, INDEPENDENT
CONTRACTORS, ATTORNEYS, ADVISERS, SUCCESSORS AND ASSIGNS (THE
"SPECTRUM GROUP"), JOINTLY AND SEVERALLY, FROM ANY AND ALL
CLAIMS, KNOWN OR UNKNOWN, WHICH FRANCO, HIS HEIRS, SUCCESSORS, OR
ASSIGNS HAVE, OR MAY NOW OR IN THE FUTURE HAVE, AGAINST ANY
MEMBER OF THE SPECTRUM GROUP AND ANY AND ALL LIABILITY WHICH ANY
MEMBER OF THE SPECTRUM GROUP HAS, OR MAY NOW OR IN THE FUTURE
HAVE TO FRANCO, WHETHER DENOMINATED CLAIMS, DEMANDS, CAUSES OF
ACTION, OBLIGATIONS, DAMAGES OR LIABILITIES, ARISING FROM ANY AND
ALL BASES, INCLUDING BUT NOT LIMITED TO ANY CLAIMS UNDER ANY
POLICY, AGREEMENT, ARRANGEMENT OR PRACTICE OF OR WITH ANY MEMBER
OF THE SPECTRUM GROUP (INCLUDING ANY INDEMNIFICATION AGREEMENT OR
OBLIGATION) OR ANY FEDERAL, STATE, OR LOCAL LAW OR REGULATION,
RELATING TO ANY MATTER, CAUSE OR THING WHATSOEVER FROM THE
BEGINNING OF THE WORLD TO THE DATE OF THIS MUTUAL RELEASE AND
WAIVER, INCLUDING, WITHOUT LIMITATION, ANY SUCH CLAIMS THAT ARISE
OUT OF OR RELATE TO (I) ANY EVENT OCCURRING IN WHOLE OR IN PART
PRIOR TO SPECTRUM'S ACQUISITION OF GLOBAL ON OCTOBER 31, 1993,
(II) FRANCO'S RELATIONSHIP WITH THE SPECTRUM GROUP, THE
TERMINATION OF SUCH RELATIONSHIP OR THE PURCHASE, OWNERSHIP AND
SALE BY SPECTRUM OF GLOBAL OR (III) THE EMPLOYMENT AGREEMENT, BUT
EXCLUDING ANY CLAIMS FOR INDEMNIFICATION UNDER THE EMPLOYMENT
AGREEMENT OR THE BY-LAWS OF SPECTRUM. THIS RELEASE IS FOR ANY
RELIEF, NO MATTER HOW DENOMINATED, INCLUDING, BUT NOT LIMITED TO,
WAGES, BACK PAY, FRONT PAY, COMPENSATORY DAMAGES OR PUNITIVE
DAMAGES. FRANCO FURTHER AGREES THAT HE WILL NOT FILE OR PERMIT
TO BE FILED ON HIS BEHALF ANY SUCH CLAIM.
THE SPECTRUM GROUP AGREES TO RELEASE, REMISE, ACQUIT
AND DISCHARGE FRANCO AND HIS HEIRS, SUCCESSORS AND ASSIGNS (THE
"FRANCO GROUP"), JOINTLY AND SEVERALLY, FROM ANY AND ALL CLAIMS,
KNOWN OR UNKNOWN, WHICH THE SPECTRUM GROUP HAS, OR MAY NOW OR IN
THE FUTURE HAVE, AGAINST ANY MEMBER OF THE FRANCO GROUP AND ANY
AND ALL LIABILITY WHICH ANY MEMBER OF THE FRANCO GROUP HAS, OR
MAY NOW OR IN THE FUTURE HAVE TO THE SPECTRUM GROUP, WHETHER
DENOMINATED CLAIMS, DEMANDS, CAUSES OF ACTION, OBLIGATIONS,
DAMAGES OR LIABILITIES, ARISING FROM ANY AND ALL BASES, INCLUDING
BUT NOT LIMITED TO ANY CLAIMS UNDER ANY POLICY, AGREEMENT OR
ARRANGEMENT OR ANY FEDERAL, STATE, OR LOCAL LAW OR REGULATION,
RELATING TO ANY MATTER, CAUSE OR THING WHATSOEVER FROM THE
BEGINNING OF THE WORLD TO THE DATE OF THIS MUTUAL RELEASE AND
WAIVER, EXCEPT FOR ANY CLAIMS, KNOWN OR UNKNOWN, WHICH THE
SPECTRUM GROUP HAS, OR MAY NOW OR IN THE FUTURE HAVE, AGAINST ANY
MEMBER OF THE FRANCO GROUP ARISING UNDER SECTION 6.2, 6.4, 11.4,
12.3 OR 12.16 OF THE STOCK PURCHASE AGREEMENT AND EXCEPT AS
PROVIDED IN ARTICLE III HEREIN. THIS RELEASE IS FOR ANY RELIEF,
NO MATTER HOW DENOMINATED. THE SPECTRUM GROUP FURTHER AGREES
THAT IT WILL NOT FILE OR PERMIT TO BE FILED ON ITS BEHALF ANY
SUCH CLAIM. NOTHING CONTAINED IN THIS MUTUAL RELEASE AND WAIVER
WILL LIMIT THE EFFECT OF SECTION 11.9 OF THE STOCK PURCHASE
AGREEMENT.
II. Identified Consideration
Franco acknowledges and agrees that Spectrum, and
Spectrum acknowledges and agrees that Franco, has entered into
the Stock Purchase Agreement in consideration for the mutual
release evidenced hereby, and that Spectrum's and Franco's
entering into the Stock Purchase Agreement is good and valuable
consideration for such release.
III. Acknowledgment Regarding Certain Agreements
Franco acknowledges and agrees that his obligations
under Section 6 of the Employment Agreement between Spectrum and
Franco with respect to the business of the Spectrum Group
(excluding Global) shall continue in effect in accordance with
its terms following the date hereof. Franco further agrees that
such obligations shall be incorporated herein and made a part
hereof as if repeated herein and that Spectrum's agreement to
enter into the Stock Purchase Agreement constitutes additional
consideration for his agreement to be bound by such obligations.
IV. Certain Statutory Benefits
Spectrum agrees that Franco may be entitled under
applicable U.S. federal or state law to exercise continuation of
coverage or conversion rights under certain insurance and other
welfare plans of Spectrum. This Mutual Release and Waiver does
not and is not intended to diminish his rights and entitlements
under any such plans.
V. No Admission
(a) Spectrum admits no liability of any sort to Franco
and nothing herein is intended to, or shall be deemed to,
constitute an admission of liability of any kind by any member of
the Spectrum Group.
(b) Franco admits no liability of any sort to Spectrum
and nothing herein is intended to, or shall be deemed to,
constitute an admission of liability of any kind by any member of
the Spectrum Group.
VI. Third-Party Beneficiary Rights
Franco agrees that the terms of this Mutual Release and
Waiver shall inure to the benefit of and shall be enforceable by
each member of the Spectrum Group, each of whom is intended to be
a third-party beneficiary hereof, and its respective successors
and assigns. Spectrum agrees that the terms of this Mutual
Release and Waiver shall inure to the benefit of and shall be
enforceable by each member of the Franco Group, each of whom is
intended to be a third-party beneficiary hereof, and its
respective successors and assigns.
VII. General Provisions
(a) This Mutual Release and Waiver constitutes the
entire understanding of Spectrum and Franco with respect to the
subject matter hereof, and supersedes all prior understandings,
written or oral, except as expressly provided herein. The terms
of this Mutual Release and Waiver may be changed, modified or
discharged only by an instrument in writing signed by the parties
hereto. A failure of a party to insist on strict compliance with
any provision of this Mutual Release and Waiver shall not be
deemed a waiver of such provision or any other provision hereof.
In the event that any provision of this Mutual Release and Waiver
is determined to be so broad as to be unenforceable, such
provision shall be interpreted to be only so broad as is
enforceable.
(b) This Mutual Release and Waiver shall be construed,
enforced and interpreted in accordance with and governed by the
laws of the State of New York without reference to the principles
of conflicts of law. The courts of New York shall have
jurisdiction to entertain any action arising hereunder.
VIII. Knowing and Voluntary Waiver
Franco and Spectrum each agree and acknowledge that
they have read this Mutual Release and Waiver, have consulted
with an attorney of his or its choosing with respect hereto and
completely understands the terms and consequences hereof and that
the execution of this Mutual Release and Waiver is his or its
knowing, free and voluntary act.
______________________________________
Xxxxxxxxxxx X. Xxxxxx
SPECTRUM INFORMATION TECHNOLOGIES, INC.
______________________________________
By: Xxxxxx X. Xxxxxxx,
Chief Executive Officer
EXHIBIT P
FORM OF MANAGER ESCROW AGREEMENT
ESCROW AGREEMENT dated as of September 11, 1995 among Xxxxx
X. Xxxxxxx ("Xxxxxxx"), Xxxxxxx Xxxxxxxxxx ("Xxxxxxxxxx" and
collectively with Xxxxxxx the "Managers"), Spectrum Information
Technologies, Inc., a Delaware corporation ("Seller"), and Xxxx
X. Xxxxxxxx, as escrow agent (the "Manager Escrow Agent").
Capitalized terms used herein and not otherwise defined shall
have the meaning ascribed to such terms in the Stock Purchase
Agreement, dated as of the date hereof, by and among the
Managers, Seller, The Xxxx Corporation, Comforce Corp., ARTRA
Group Incorporated, Xxxxx X. Xxxxxx, Xxxx X. Xxxxxx and
Manufacturers Indemnity and Insurance Company of America (the
"Stock Purchase Agreement").
WHEREAS, pursuant to Section 11.4(b) of the Stock Purchase
Agreement, the Managers are to deposit on the Closing Date (as
defined in the Stock Purchase Agreement) the sum of Fifty
Thousand U.S. Dollars ($50,000) with the Manager Escrow Agent, to
be held and released in accordance with the terms herein;
NOW, THEREFORE, in consideration of the premises and the
respective agreements hereinafter set forth, the parties hereby
agree as follows:
I. Appointment of Manager Escrow Agent
The Manager Escrow Agent is hereby appointed by the Managers
and Seller and acknowledges its appointment and agrees to act as
agent for such parties under this Agreement, subject to the terms
and condition hereof.
II. Delivery of Funds
On the Closing Date (as defined in the Stock Purchase
Agreement), the Managers shall deposit with the Manager Escrow
Agent the sum of Fifty Thousand U.S. Dollars ($50,000) to be held
by the Manager Escrow Agent in accordance with the terms of this
Agreement. Any funds held from time to time by the Manager
Escrow Agent pursuant to this Agreement (including earnings
thereon, if any) are hereinafter referred to as the "Escrow
Funds."
III. Investment of Escrow Funds
The Manager Escrow Agent shall invest the Escrow Funds in
the Premium U.S. Treasury Reserves Landmark Funds account managed
by Citibank, N.A.
IV. Release of Escrow Funds
Section 4.1 The Manager Escrow Agent shall release the
Escrow Funds, together with any and all interest earned on the
Escrow Funds from the date such amount was deposited with the
Manager Escrow Agent up to the date of such release three
business days after the earlier to occur of (i) the expiration of
the escrow in accordance with the provisions of Section 11.4 of
the Stock Purchase Agreement, unless a claim has been filed
against such escrow in accordance with such Section prior to such
expiration and (ii) in accordance with any instrument in writing
signed by each of the Managers and Seller or in accordance with
any order of a court of competent jurisdiction directing the
Manager Escrow Agent to release the Escrow Funds.
Section 4.2. As of the date that the Manager Escrow Agent
has delivered the Escrow Funds to Seller or the Managers in
accordance with the provisions hereof, this Agreement shall
terminate as to the Manager Escrow Agent, except that the
provisions of Article V hereof shall survive such termination.
V. Rights of the Manager Escrow Agent
Section 5.1 The Manager Escrow Agent shall have no duties
or responsibilities except those expressly set forth herein and
shall not be subject to, nor obliged to recognize, monitor or
enforce the terms of any other agreement between, or direction or
instruction of, the Managers or Seller, even though reference
thereto may be made herein; provided, however, that these escrow
instructions may be amended at any time or times by an instrument
in writing signed by the parties hereto.
Section 5.2 The Manager Escrow Agent is authorized, in its
sole discretion, to disregard any and all notices or instructions
given by any of the undersigned or by any other person, firm or
corporation, except only such notices or instructions as are
hereinabove provided for and orders or process of any court
entered or issued with or without jurisdiction. If any property
subject hereto is at any time attached, garnished, or levied upon
under any court order or in case the payment, assignment,
transfer, conveyance or delivery of any such property shall be
stayed or enjoined by any court order, or in case any order,
judgment or decree shall be made or entered by any court
affecting such property or any part thereof, then and in any of
such events the Manager Escrow Agent is authorized, in its sole
discretion, to rely upon and comply with any such order, writ,
judgment or decree which it is so advised by legal counsel of its
own choosing is binding upon it, and if it complies with any such
order, writ, judgment or decree it shall not be liable to any of
the parties hereto or to any other person, firm or corporation by
reason of such compliance even though such order, writ, judgment
or decree may be subsequently reversed, modified, annulled, set
aside or vacated.
Section 5.3 The Manager Escrow Agent may rely upon any
instrument in writing believed in good faith by it to be genuine
and sufficient and shall not be liable or responsible for any
action taken or omitted in accordance with the provisions
thereof.
Section 5.4 The Manager Escrow Agent shall not be
personally liable for any act taken or omitted hereunder except
for its gross negligence, bad faith or willful misconduct.
Section 5.5 The Managers and Seller (the "Indemnifying
Parties") hereby agree to be jointly and severally liable for,
and indemnify the Manager Escrow Agent and hold it harmless
against any loss, liability, cost and expense (including
reasonable attorneys' fees) which may be imposed upon or incurred
by the Manager Escrow Agent hereunder, except through the Manager
Escrow Agent's own gross negligence, bad faith or willful
misconduct. The Manager Escrow Agent shall notify the
Indemnifying Parties promptly of any claim for which it may seek
indemnity, although the failure to notify shall only excuse the
obligations of an Indemnifying Party hereunder to the extent that
it prejudices the ability of such Indemnifying Party to contest
any such claim. The Indemnifying Parties may contest the claim,
and the Manager Escrow Agent shall cooperate in any such contest,
in which case the Manager Escrow Agent may have at its discretion
separate counsel, and the Indemnifying Parties shall pay the
reasonable fees and expenses of such counsel. The Indemnifying
Parties need not pay for any settlement made without their
consent.
Section 5.6 In the event of any disagreement between any of
the parties hereto resulting in adverse claims or demands being
made in connection with the subject matter of this Agreement, or
in the event that the Manager Escrow Agent should be in doubt as
to what action it should take hereunder, the Manager Escrow Agent
may, at its option, refuse to comply with any claims or demands
on it, or refuse to take any other action hereunder, so long as
such disagreement continues or such doubt exists, and in any such
event, the Manager Escrow Agent shall not be or become liable for
damages, interest, or in any other way or to any person for its
failure or refusal to act, and the Manager Escrow Agent shall be
entitled to continue so to refrain from acting until (a) the
rights of all parties shall have been fully and finally
adjudicated by a court of competent jurisdiction or by the mutual
agreement of the Managers and Seller and (b) the Manager Escrow
Agent shall have received appropriate evidence of the foregoing,
in which event the Manager Escrow Agent shall release the Escrow
Funds in accordance with such adjudication or agreement, as the
case may be. In the alternative, the Manager Escrow Agent, may,
but shall not be obligated to, file a suit in interpleader (the
parties hereto consenting to the filing of such action in the
Bankruptcy Court for the Eastern District of New York) for a
declaratory judgment for the purpose of having the respective
rights of the parties adjudicated, and may deposit with such
court the Escrow Funds, in which case the Managers agree to pay
all costs, expenses and attorneys' fees incurred by the Manager
Escrow Agent in connection therewith, the amount thereof to be
fixed and such judgment therefor to be rendered by the court in
such suit.
Section 5.7 Seller acknowledges and agrees that the Manager
Escrow Agent has acted and will continue to act as counsel to the
Managers, including, without limitation, in connection with any
dispute arising hereunder.
VI. Miscellaneous Provisions
Section 6.1 Subject to Section 5.6 hereof, if the Closing
(as defined in the Stock Purchase Agreement) does not occur under
the Stock Purchase Agreement for any reason, or if the Stock
Purchase Agreement is terminated pursuant to Section 10.1
thereof, this Agreement shall terminate and be of no force or
effect.
Section 6.2 The Managers and Seller shall attempt in good
faith to resolve promptly any disputes arising hereunder.
Section 6.3 All notices, requests and other communications
required or permitted to be given hereunder shall be in writing
and shall be deemed given if delivered personally (including by
courier), given by prepaid telegram or mailed first class,
postage prepaid, registered or certified mail or via Federal
Express overnight delivery, addressed as follows:
(a) If to Seller:
Spectrum Information Technologies, Inc.
0000 Xxxxxxxxxxx Xxxxxx
Xxxxxxxx, Xxx Xxxx 00000
Attention: Xx. Xxxxxx X. Xxxxxxx
Fax: (000) 000-0000
with a copy to:
Cleary, Gottlieb, Xxxxx & Xxxxxxxx
Xxx Xxxxxxx Xxxxx, Xxxxx 0000
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxxxx, Esq.
Fax: (000) 000-0000
(b) If to the Managers:
Xxxxx X. Xxxxxxx
00 Xxxxx Xxxxx
Xxxxxxxx, XX 00000
Fax: (000) 000-0000
Xxxxxxx Xxxxxxxxxx
000 Xxxxx Xxxxx Xxxx
Xxxx Xxxx, XX 00000
with a copy to:
Xxxx X. Xxxxxxxx
Attorney At Law
00 Xxxxxxx Xxxx, Xxxxx 0000
Xxxxxx, XX 00000
Attention: Xxxx X. Xxxxxxxx, Esq.
Fax: (000) 000-0000
(c) If to the Manager Escrow Agent:
Xxxx X. Xxxxxxxx
Attorney At Law
00 Xxxxxxx Xxxx, Xxxxx 0000
Xxxxxx, XX 00000
Attention: Xxxx X. Xxxxxxxx, Esq.
Fax: (000) 000-0000
Each of the foregoing shall be entitled to specify a
different address by giving notice as aforesaid to the others.
All notices, requests and other communications shall be
deemed to have been received at the time that they are actually
received, but not later than three days after delivery by mail.
Whenever under the terms hereof the time for giving a notice or
performing an act falls upon a Saturday, Sunday, or holiday, such
time shall be extended to the next business day. The Managers
and Seller shall provide to each other any notice provided by
either of them to the Manager Escrow Agent, using the same method
of delivery.
Section 6.4 This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all
of which together shall constitute one and the same instrument.
Section 6.5 This Agreement shall inure to the benefit of
and be binding upon the parties hereto and their respective
heirs, executors, personal representatives, successors and
assigns; provided, however, that any assignment of this Agreement
or the rights hereunder by any party hereto without the written
consent of the other parties shall be void. Nothing in this
Agreement, expressed or implied, is intended to confer upon any
other person any rights or remedies under or by reason of this
Agreement.
Section 6.6 This Agreement, and all matters relating
hereto, shall be governed by and construed and enforced in
accordance with the laws of the State of New York.
Section 6.7 No consent or waiver, expressed or implied, by
any party of any breach or default by any other in the
performance by the other of its obligations hereunder shall be
deemed or construed to be a consent or waiver to or of any other
breach or default in the performance by such party of the same or
any obligations of the party. Failure on the part of any party
to complain of any act or failure to act of the other party or to
declare the other party in default, irrespective of how long such
failure continues, shall not constitute a waiver by that party of
its rights under this Agreement or otherwise.
Section 6.8 No modification, amendment, waiver or discharge
of this Agreement shall bind any party unless in writing and
signed by or on behalf of such party.
Section 6.9 The Article captions used herein are for
reference purposes only, and shall not in any way affect the
meaning or interpretation of this Agreement.
Section 6.10 This Agreement contains the entire
understanding of the parties hereto with respect to the subject
matter contained herein and supersedes all prior agreements,
correspondence, conversations, negotiations and understandings
between the parties with respect to such subject matter.
Section 6.11 As used in this Agreement, any gender includes
a reference to all other genders and the singular includes a
reference to the plural and vice versa.
IN WITNESS WHEREOF, the parties hereto have duly executed
this Agreement as of the date first above written.
SPECTRUM INFORMATION
TECHNOLOGIES, INC.
By__________________________
Name: Xxxxxx X. Xxxxxxx
Title: Chief Executive Officer
XXXXX X. XXXXXXX
____________________________
XXXXXXX XXXXXXXXXX
____________________________
XXXX X. XXXXXXXX
as Manager Escrow Agent
____________________________
EXHIBIT Q
FORM OF NON-COMPETITION AGREEMENT
AGREEMENT, dated this 11th day of September, 1995,
between SPECTRUM INFORMATION TECHNOLOGIES, INC., a corporation
organized under the laws of the State of Delaware ("Spectrum"),
and SPECTRUM GLOBAL SERVICES, INC., a corporation organized under
the laws of the State of Delaware ("Global"), acting as agent for
the Purchasing Group (as hereinafter defined). Capitalized terms
used herein and not otherwise defined shall have the meanings
ascribed to such terms in the Stock Purchase Agreement.
WHEREAS, Spectrum has entered into a Stock Purchase
Agreement, dated as of the date hereof (the "Stock Purchase
Agreement") with The Xxxx Corporation, a corporation organized
under the laws of the State of Delaware ("Xxxx"), Comforce Corp.,
a corporation organized under the laws of the State of Delaware
("Purchaser"), ARTRA Group Incorporated, a corporation organized
under the laws of the State of Delaware ("ARTRA"), Xxxxx X.
Xxxxxx ("Xxxxxx"), Xxxx X. Xxxxxx ("Xxxxxx"), Xxxxx X. Xxxxxxx
("Xxxxxxx"), Xxxxxxx Xxxxxxxxxx ("Xxxxxxxxxx"), and Xxxxxxxxxxx
X. Xxxxxx ("Franco"), under which Spectrum agrees to sell and
Purchaser agrees to purchase all of the outstanding capital stock
of Global;
WHEREAS, in consideration for the mutual agreements and
covenants set forth in the Stock Purchase Agreement, the
Purchasing Group desires that Spectrum enter into this Agreement
with Global not to engage in certain activities during the period
and on the terms and conditions set forth below; and
WHEREAS, in consideration for mutual agreements and
covenants set forth in the Stock Purchase Agreement, Spectrum
desires to obtain and the Purchasing Group desires to give the
Purchasing Group's agreement not to engage in certain activities
during the period and on the terms and conditions set forth
below;
NOW, THEREFORE, for good and valuable consideration,
the receipt of which is hereby acknowledged, the parties hereto
agree as follows:
1. Spectrum Covenant Not to Compete.
(a) From and after the Closing Date under the Stock
Purchase Agreement and until the date which is three and one-half
(3.5) years after such Closing Date, in accordance with Section
12.3 of the Stock Purchase Agreement, Spectrum agrees not to
engage in any aspect of the Business; provided, however, that
Spectrum, at its option, may provide services on a contract labor
basis for the purposes of performing consulting services and
systems integration relating to the systems analysis, design,
support, development and/or implementation of solutions to
clients in the fields of telecommunications, computing and
information technology, but only to the extent such contract
labor services are directly related to the project, engagement,
system or solution for which Seller's Systems Integration
business was retained by the client (the "Protected Business").
If the Closing does not occur under the Stock Purchase Agreement
for any reason, including, without limitation, if the Stock
Purchase Agreement is terminated pursuant to Section 10.1
thereof, this Agreement shall terminate and be of no force or
effect.
(b) Spectrum shall be deemed to be engaging in the
Protected Business if, and only if, it:
(i) engages in the Protected Business;
(ii) directly or indirectly, owns any Competitor
(as hereinafter defined); or
(iii) directly or indirectly, solicits any Person
that is a customer of Global as of the date hereof with a view to
inducing such customer to do business with Spectrum or any
Competitor with respect to the Protected Business.
(c) For purposes of this Section 1, the term
"Competitor" means any corporation, firm, partnership,
proprietorship or other entity which engages in the Protected
Business.
2. Global and Purchasing Group Covenant Not to
Compete.
(a) In accordance with Section 12.3 of the Stock
Purchase Agreement, Global and each member of the Purchasing
Group agree not to engage in any aspect of Spectrum's Business
for a period of three and one-half (3.5) years after the Closing
Date, unless it first offers the opportunity to Seller of
substantially participating in a joint project or venture with
respect to such business.
(b) Global and each member of the Purchasing Group
shall be deemed to be engaging in Spectrum's Business (as
hereinafter defined) if, and only if, Global or such member:
(i) engages in Spectrum's Business;
(ii) directly or indirectly, owns any Competitor (as
hereinafter defined); or
(iii) directly or indirectly, solicits any Person that
is a customer of Spectrum as of the date hereof with a view to
inducing such customer to do business with Global, any member of
the Purchasing Group or any Competitor with respect to Spectrum's
Business.
(c) For the purposes of this Section 2:
(i) "Spectrum's Business" means the wireless data
communication software product business.
(ii) A "Competitor" is any corporation, firm,
partnership, proprietorship or other entity which engages in
Spectrum's Business.
3. Miscellaneous.
(a) All notices, requests and other communications
required or permitted to be given hereunder shall be in writing
and shall be deemed given if delivered personally (including by
courier), given by prepaid telegram or mailed first class,
postage prepaid, registered or certified mail, addressed as
follows:
(i) If to Spectrum:
Spectrum Information Technologies, Inc.
0000 Xxxxxxxxxxx Xxxxxx
Xxxxxxxx, Xxx Xxxx 00000
Attention: Xx. Xxxxxx X. Xxxxxxx
Fax: (000) 000-0000
with a copy to:
Cleary, Gottlieb, Xxxxx & Xxxxxxxx
Xxx Xxxxxxx Xxxxx, Xxxxx 0000
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxxxx, Esq.
Fax: (000) 000-0000
(ii) If to the Purchasing Group:
Comforce Corp.
000 Xxxxxxx Xxxxxx
Xxxx Xxxxxx Xxx 0000
Xxxxxxxxxx, XX 00000-0000
Attention: Xx. Xxxxx X. Xxxxxx
with a copy to:
Xxxx X. Xxxxxxxx
Attorney At Law
00 Xxxxxxx Xxxx, Xxxxx 0000
Xxxxxx, XX 00000
Attention: Xxxx X. Xxxxxxxx, Esq.
Fax: (000) 000-0000
Each of the foregoing shall be entitled to specify a
different address by giving notice as aforesaid to the others.
Whenever under the terms hereof the time for giving a notice
or performing an act falls upon a Saturday, Sunday, or holiday,
such time shall be extended to the next business day.
(b) This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all
of which together shall constitute one and the same instrument.
(c) This Agreement shall inure to the benefit of and be
binding upon the parties hereto and their respective heirs,
executors, administrators and other legal representatives.
Neither this Agreement nor any right or obligation hereunder may
be assigned by either party hereto. Nothing in this Agreement,
expressed or implied, is intended to confer upon any other person
any rights or remedies under or by reason of this Agreement.
(d) This Agreement, and all matters relating hereto,
shall be governed by and construed and enforced in accordance
with the laws of the State of New York.
(e) No consent or waiver, expressed or implied, by any
party of any breach or default by any other in the performance by
the other of its obligations hereunder shall be deemed or
construed to be a consent or waiver to or of any other breach or
default in the performance by such party of the same or any
obligations of the party. Failure on the part of any party to
complain of any act or failure to act of the other party or to
declare the other party in default, irrespective of how long such
failure continues, shall not constitute a waiver by that party of
its rights under this Agreement or otherwise.
(f) No modification, amendment, waiver or discharge of
this Agreement shall bind any party unless in writing and signed
by or on behalf of such party.
(g) In the event any provision of this Agreement is
found to be void and unenforceable by a court of competent
jurisdiction or arbitration panel, the remaining provisions of
this Agreement shall cease to be binding upon the parties hereto.
(h) The captions used herein are for reference
purposes only, and shall not in any way affect the meaning or
interpretation of this Agreement.
(i) This Agreement, including the other documents
referred to herein, contains the entire understanding of the
parties hereto with respect to the subject matter contained
herein and therein and supersedes all prior agreements,
correspondence, conversations, negotiations and understandings
between the parties with respect to such subject matter.
(j) As used in this Agreement, any gender includes a
reference to all other genders and the singular includes a
reference to the plural and vice versa.
(k) Any judicial proceeding brought against any of the
parties to this Agreement on any dispute arising out of this
Agreement or any matter related hereto shall be brought in the
courts of the State of New York or in the United States District
Court for the Eastern District of New York (or the Bankruptcy
Court in that District), and, by execution and delivery of this
Agreement, each of the parties to this Agreement accepts for
itself or himself the process in any action or proceeding by the
mailing of copies of such process to such party at its or his
address as set forth in 3(a), and irrevocably agrees to be bound
by any judgment rendered thereby in connection with this
Agreement. Each party hereto irrevocably waives to the fullest
extent permitted by law any objection that it or he may now or
hereafter have to the laying of the venue of any judicial
proceeding brought in such courts and any claim that any such
judicial proceeding has been brought in an inconvenient forum.
The foregoing consent to jurisdiction shall not constitute
general consent to service of process in the State of New York
for any purpose except as provided above and shall not be deemed
to confer rights on any person other than the respective parties
to this Agreement. EACH PARTY HERETO WAIVES TRIAL BY JURY IN ANY
JUDICIAL PROCEEDING UNDER THIS AGREEMENT.
(l) Each party hereto intends that this Agreement
shall not benefit or create any right or cause of action in or on
behalf of any person other than the parties hereto and their
respective successors and assigns as permitted under 3(c).
IN WITNESS WHEREOF, Spectrum and Xxxx have caused this
Agreement to be signed by their respective officers thereunto
duly authorized, all as of the day and year first above written.
SPECTRUM INFORMATION TECHNOLOGIES, INC.
By: __________________________________
Name: Xxxxxx X. Xxxxxxx
Title: Chief Executive Officer
SPECTRUM GLOBAL SERVICES, INC.
By: __________________________________
Name: Xxxxx X. Xxxxxxx
Title: President
EXHIBIT R
FORM OF CONFIDENTIALITY AGREEMENT
Dear Sirs or Madams:
You have requested information from Spectrum
Information Technologies, Inc. (the "Seller") in connection with
your consideration of a possible transaction (a "Transaction")
involving Spectrum Global Services, Inc. (the "Company"). As a
condition to our furnishing such information to you, we are
requiring that you agree, as set forth below, to treat
confidentially such information and any other information that
the Seller, its agents or its representatives (including
attorneys and financial advisors) furnishes to you or your
designees (all of the foregoing collectively referred to as "your
Representatives"), whether furnished before or after the date of
this letter, and all analyses and studies, whether prepared by
you or others, which contain or otherwise reflect such
information (collectively, the "Evaluation Material").
The term "Evaluation Material" does not include
information which (i) becomes generally available to the public
other than as a result of a disclosure by you or your
Representatives, (ii) was available to you on a non-confidential
basis prior to its disclosure to you by the Seller, its
representatives or its agents, or (iii) becomes available to you
on a non-confidential basis from a source other than the Seller,
its representatives or its agents, provided that such source is
not bound by a confidentiality agreement with the Seller, its
representatives or its agents or otherwise prohibited from
transmitting the information to you or your Representatives by a
contractual, legal or fiduciary obligation.
It is understood that you may disclose any of the
Evaluation Material to those of your Representatives who require
such material for the purpose of evaluating a possible
Transaction (provided that such Representatives shall be informed
by you of the confidential nature of the Evaluation Material).
You agree that the Evaluation Material will be kept confidential
by you and your Representatives and, except with the specific
prior written consent of the Seller (or, in the event of a sale
of the Company, of the Company) or as expressly otherwise
permitted by the terms hereof, will not be disclosed by you or
your Representatives. You further agree that you and your
Representatives will not use any of the Evaluation Material for
any reason or purpose other than to evaluate a possible
Transaction.
In the event that you or any of your Representatives
are requested or required (by oral questions, interrogatories,
requests for information or documents, subpoena, Civil
Investigative Demand or similar process) to disclose any of the
Evaluation Material, it is agreed that you or such
Representative, as the case may be, will provide the Seller and
the Company with prompt notice of such request(s) so that it may
seek an appropriate protective order or other appropriate remedy
and/or waive your or such Representative's compliance with the
provisions of this Agreement. In the event that such protective
order or other remedy is not obtained, or that the Seller (or, in
the event of a sale of the Company, the Company) grants a waiver
hereunder, you or such Representative may furnish that portion
(and only that portion) of the Evaluation Material which, in the
written opinion of your counsel, you are legally compelled to
disclose and will exercise your best efforts to obtain reliable
assurance that confidential treatment will be accorded any
Evaluation Material so furnished.
Without the prior written consent of the Seller (or, in
the event of a sale of the Company, of the Company), (1) neither
you nor those of your Representatives who are aware of the
Evaluation Material and/or the possibility of a Transaction will
initiate or cause to be initiated any communications with any
employee of the Company concerning the Evaluation Material or any
possible Transaction and (2) none of your directors, officers or
employees who are aware of the Evaluation Material and/or the
possibility of a Transaction will, for the one-year period from
the date of this letter agreement, solicit or cause to be
solicited the employment of or hire any employee of the Company.
You will promptly upon the written request of the
Seller (or, in the event of a sale of the Company, of the
Company) deliver to the Seller or the Company, as the case may
be, all documents or other matter furnished by the Seller or the
Company or its agents or representatives to you or your
Representatives constituting Evaluation Material, together with
all copies thereof in the possession of you or your
Representatives. In the event of such request, all other
documents or other matter constituting Evaluation Material in the
possession of you or your Representatives will be destroyed, with
any such destruction confirmed by you in writing to the Seller or
the Company, as the case may be.
Although you understand that the Seller and the Company
have endeavored to include in the Evaluation Material information
known to them which they believe to be relevant for the purpose
of your investigation, you further understand that neither the
Seller, the Company nor their agents or their representatives
makes any representation or warranty as to the accuracy or
completeness of the Evaluation Material. You are advised that
the Seller has executed an agreement to sell the stock of the
Company to a group of investors, and such agreement (i) requires
Bankruptcy Court approval and (ii) is subject to receipt of
"higher and better" offers for the Company's Stock. A hearing to
consider such agreement is scheduled for October 17, 1995.
Moreover, you acknowledge that Xxxxx X. Xxxxxxx, Xxxxxxx
Xxxxxxxxxx and Xxxxx Xxxxxx are currently employees of the
Company or the Seller and, together with others, are signatories
to such agreement. You agree that neither the Seller, the
Company nor their agents or their representatives shall have any
liability to you or any of your Representatives resulting from
the use of the Evaluation Material by you or such
Representatives. Only those representations and warranties that
may be made to you or your affiliates in a definitive written
agreement for a Transaction, when, as and if executed and subject
to such limitations and restrictions as may be specified therein,
shall have any legal effect, and you agree that if you determine
to engage in a Transaction such determination will be based
solely on the terms of such written agreement and on your own
investigation, analysis and assessment of the business to be
acquired. Moreover, unless and until such a definitive written
agreement is entered into, none of the Seller, the Company or
their agents, representatives or affiliates, or you or your
Representatives will be under any legal obligation of any kind
whatsoever with respect to such a Transaction except for the
matters specifically agreed to in this Agreement. Without
limiting the generality of the foregoing, you specifically
acknowledge and agree that the Seller may conduct and change the
process with respect to any possible Transaction as it in its
sole discretion shall determine, including, without limitation,
at any time terminating access to the Evaluation Material by you
and your Representatives without prior notice to you or any other
person. The agreements set forth in this Agreement may be
modified or waived only by a separate writing signed by the
Seller, the Company and you expressly so modifying or waiving
such agreements.
You hereby agree to indemnify and hold harmless the
Seller and the Company from any damage, loss, cost or liability
(including reasonable legal fees) arising out of or resulting
from any material breach by you or your representatives of this
Agreement. You also acknowledge that money damages would be both
incalculable and an insufficient remedy for any breach of this
Agreement by you or your Representatives and that any such breach
would cause the Company irreparable harm. Accordingly, you also
agree that in the event of any breach or threatened breach of
this Agreement, the Company, in addition to any other remedies at
law or in equity it may have, shall be entitled, without the
requirement of posting a bond or other security, to equitable
relief, including injunctive relief and specific performance.
It is understood and agreed that no failure or delay by
the Seller or the Company in exercising any right, power or
privilege hereunder shall operate as a waiver thereof, nor shall
any single or partial exercise thereof preclude any other or
further exercise thereof or the exercise of any right, power or
privilege hereunder. It is understood that this Agreement is for
the benefit of the Seller and the Company.
The invalidity or unenforceability of any provision of
this Agreement shall not affect the validity or enforceability of
any other provisions of this letter agreement, which shall remain
in full force and effect.
You agree and consent to personal jurisdiction and
service and venue in any federal or state court within the State
of New York (including the United States Bankruptcy Court for the
Eastern District of New York) having subject matter jurisdiction,
for the purposes of any action, suit or proceeding arising out of
or relating to this Agreement. This Agreement shall be governed
by and construed in accordance with the laws of the State of New
York.
If you are in agreement with the foregoing, please sign
and return one copy of this letter, which thereupon will
constitute our Agreement with respect to the subject matter
hereof.
Very truly yours,
SPECTRUM INFORMATION TECHNOLOGIES, INC.
By ___________________________________
Gordian Group, L.P.
on behalf of
Spectrum Information Technologies, Inc.
Confirmed and agreed to as of
the date first above written:
[ ]
By ____________________________
Title:
