EXHIBIT 10.1
AMENDED AND RESTATED
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OPTION AGREEMENT
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This Amended and Restated Option Agreement (the "Agreement") is made as
of this 23rd day of October, 1996 by and among Boston Communications Group,
Inc., formally known as Radio Telephone Systems, Inc., a Massachusetts
corporation ("BCG"), Wireless Americas Corp., a Delaware corporation ("WAC")
and Robert B. Sproul (the "Seller").
RECITALS
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A. As of January 31, 1996, the parties to this Agreement and certain other
persons who were at the time shareholders of WAC, entered into that certain
Option Agreement (the "Initial Option Agreement"), pursuant to which BCG was
granted an option to purchase all shares of stock owned by Seller and all other
shareholders of WAC, other than BCG.
B. On or about June 18, 1996, BCG's common stock became publicly traded and
all of the shareholders of WAC other than BCG and the Seller, sold their shares
of WAC to the Seller for valuable consideration (the "Former Shareholders
Shares").
C. In connection with the sale of the Former Shareholders Shares to Seller,
Seller granted to BCG an option to purchase all of the Former Shareholders
Shares pursuant to a separate option arrangement. Contemporaneously with the
execution of this Agreement, Seller is selling to BCG the Former Shareholders
Shares.
D. In consideration for the sale of the Former Shareholders Shares to BCG,
BCG has among other things agreed to provide the Seller with the right to put
the shares of WAC owned by Seller, to BCG and amend the Initial Option Agreement
in accordance with the terms of this Amended and Restated Option Agreement. Upon
the consummation of the transactions contemplated by the sale of the Former
Shareholders Shares to BCG, Seller shall be the owner of 20% and BCG 80%, of all
of the issued and outstanding shares of capital stock of WAC.
NOW, THEREFORE, in consideration of the foregoing premises and the
covenants and agreements hereinafter set forth, and other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
Seller, BCG and WAC, intending to be legally bound, hereby agree as follows:
1. Option and Put Grants.
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(a) Grant of Option. Seller hereby grants to BCG an option ("Option")
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to purchase all, but not less than all, of the capital stock of WAC now owned or
hereafter acquired by Seller (the "Option Shares").
(b) Grant of Put. BCG hereby grants to the Seller the right to require
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BCG to purchase all, but not less than all, of the Option Shares in accordance
with the provisions of this Agreement (the "Put").
(c) Issuance of Additional Shares. WAC hereby agrees that it shall not
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issue any additional shares of its capital stock without the prior written
consent of BCG and Seller, either of which can withhold their consent for any
reason whatsoever in their sole discretion. However, in the event BCG and Seller
consent to the issuance of additional shares of WAC's capital stock then WAC
hereby agrees that it shall not issue any such shares unless and until the
recipient of such shares executes and delivers to WAC an option agreement
substantially similar to the terms of the Initial Option Agreement.
2. Exercise of Put. The Seller may exercise the Put upon the earlier
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to occur of the following;
(a) The Amended and Restated Employment Agreement between WAC and the
Seller dated as of November 1, 1996 (the "Employment Agreement") is terminated
by BCG for any reason whatsoever;
(b) That certain Distribution Agreement dated January 31, 1996 between
WAC and BCG (the "Distribution Agreement") is terminated for any reason
whatsoever;
(c) WAC issues any shares of its capital stock, or securities or
instruments convertible into any shares of its capital stock or other equity
interest, or any options, warrants, subscriptions or other rights to acquire its
capital stock or other equity interests, or any commitments, agreements or
understandings of any kind, including employee benefit arrangements, relating to
the issuance or repurchase of any of its capital stock;
(d) WAC sells all or substantially all of its assets, or engages in a
share exchange, merger, consolidation or similar transaction with an affiliate
or unrelated third party; or
(e) At any time on or after November 1, 1998.
Once the Put becomes exercisable it may be exercised at any time on or
before February 28, 2002, however, once exercised, all of the Option Shares
shall be Put to BCG to be purchased, and such Put may only be exercised on one
occasion for all of the Option Shares.
3. Exercise of Option. BCG may exercise the Option at any time commencing on
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November 1, 1998 and ending on February 28, 2002, or upon
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termination of the employment of Sproul with WAC for Cause or voluntarily by
Sproul provided, however, that once the Option is exercised BCG must purchase
all of the Option Shares together, and may only exercise such Option on one
occasion.
4. Prevailing Exercise Right. In the event Seller had the right to Put the
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Option Shares to BCG prior to November 1, 1998 but decides against doing so, as
of November 1, 1998 either BCG or the Seller can cause the Option Shares to be
purchased under their separate and distinct Option/Put rights.
5. Exercise Price. The aggregate purchase price payable for the Option
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Shares whether purchased through the Put or Option, shall be equal to the
greater of either (a) the Fair Market Value of WAC as determined in accordance
with Section 6 hereof, multiplied by twenty percent (20%), or (b) 1.75 times the
aggregate gross revenues of WAC for the trailing full twelve month period prior
to the date of the closing of the sale of the Option Shares (i.e., if the
closing occurs on November 30, 1998, then the prior full 12 month period shall
be November 1, 1997 - October 31, 1998), multiplied by twenty percent (20%)
("Revenue Formula"), provided that the aggregate gross revenues of WAC are equal
to or greater than $4,000,000. Further, in the event that the Distribution
Agreement is terminated prior to November 1, 1998, for any reason other than the
voluntary termination of the employment of Sproul with WAC, then in such event
the aggregate gross revenues used to determine the purchase price of the Option
Shares under the Revenue Formula shall not be less than $3,000,000.00.
6. Determination of Fair Market Value. The Fair Market Value of WAC shall be
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determined by an independent appraiser who is a member of the American Society
of Appraisers and attains ASA status, and is mutually satisfactory to BCG and
Seller. If BCG and Seller cannot agree on a single appraiser, BCG shall appoint
an appraiser and Seller shall appoint an appraiser and the two selected
appraisers shall appoint a third appraiser. In the event a third appraiser is
used, the third appraiser shall be solely responsible for determining the Fair
Market Value of WAC based on a review of BCG's and Seller's appraiser's
valuation, and such other information as the third appraiser deems appropriate.
The appraisal shall be completed prior to the date specified for closing in the
Exercise Notice (as defined below), and such valuation shall be as of the third
calendar day before the closing. If either BCG or the Seller shall fail to agree
upon or appoint their respective appraiser within 10 days of the Exercise Date
(as defined below), then the appraiser appointed by the other party shall
conduct the appraisal and that appraisers' determination shall be final and
binding on BCG and Seller. BCG shall bear the costs of its own appraiser, the
Seller shall bear the costs of its appraiser, and the cost of the third
appraiser shall be shared one-half by BCG and one-half by Seller. In the absence
of fraud or bad faith, the Fair Market Value determination for WAC by the one
appraiser or third appraiser, as the case may be, shall be final and binding on
BCG and Seller. In assessing the Fair Market Value, the appraisers shall review
the costs,
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expenses and other charges assessed to or paid by WAC under the terms of the
Distribution Agreement to insure that such costs, expenses and charges were fair
in comparison to similar charges normally assessed against unrelated and
independent third parties and if the charges assessed were not fair, then the
appraiser shall make pro forma adjustments. In addition, the appraisers shall
assess all transactions between WAC and affiliates of BCG to ensure that they
were on terms comparable to those customary in the industry for transactions
between unrelated third parties, and to the extent of any disparate treatment
between BCG's affiliates and WAC, the appraiser shall make pro forma
adjustments.
7. Method of Exercise of Option or Put. BCG or Seller, shall exercise the
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Option or Put, respectively, by delivering written notice (the "Exercise
Notice") to Seller or BCG, as the case may be, of its intent to exercise the
Option or the Put. Such Exercise Notice shall set forth (a) the closing date and
time for the exercise of the Option or the Put, which date shall not be less
than 30 nor more than 60 days after the date (the "Exercise Date") that the
Exercise Notice is sent, and (b) the location of the closing for the purchase of
the Option Shares. The closing of the transfer of the Option Shares shall take
place at the location and on the time and date fixed therefor in the Exercise
Notice, or at such other place and time as the parties to the closing may agree.
The purchase price for the Option Shares shall be paid by cashier's check, wire
transfer, or at BCG's option through the delivery to Seller of shares of BCG's
common stock. Upon payment of the purchase price for the Option Shares in full,
Seller shall deliver certificates representing the Option Shares being purchased
by BCG in valid form for transfer, with appropriate duly executed assignments,
stock powers or endorsements. In the event BCG elects to pay the purchase price
for the Option Shares in shares of BCG's common stock, the shares of BCG common
stock used to purchase the Option Shares shall be registered under the
Securities Act of 1933, as amended (the "Act") pursuant to an S-3 Registration,
if it is available, and if not then any other manner of registration permitted
under the Act. The number of shares of BCG stock used to purchase the Option
Shares shall be based upon the then current market price of such shares as
listed on the National Association of Securities Dealers Automated Quotation
System (NASDAQ) as an average of the closing price on NASDAQ during the 10
business day period prior to the third calendar day before the date of the
closing of the purchase of the Option Shares. In the event BCG elects to pay the
purchase price for the Option Shares with its own stock, the shares of BCG used
to pay the purchase price must be freely tradable without any holding period or
any other restrictions on the right to assign, sell or transfer the shares.
8. Representations, Warranties and Covenants of the Seller. Seller hereby
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represents, warrants, covenants and agrees in favor of BCG as follows:
(a) Except as otherwise contemplated by this Agreement, no person or
entity has, or at any time during the term of this Agreement shall have, any
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agreement or option or any right or privilege (whether by law or contract)
capable of becoming an agreement or option for the purchase from or transfer by
Seller of any of the Option Shares. The Option Shares are, and at all times
during the term of this Agreement shall be, owned beneficially and of record by
the Seller, free and clear of all liens, claims, options, charges, pledges,
securities and trusts, limitations on the exercise of any right and other
encumbrances of any kind whatsoever. Upon delivery of certificates for the
Option Shares to BCG pursuant to the terms of this Agreement, BCG will hold
valid and marketable title to such Option Shares, free and clear of all liens.
(b) Except for shares of its capital stock issued to BCG and Seller,
WAC has not issued, and shall not issue during the term of this Agreement, any
other shares of its capital stock nor any warrants, options, agreements, phantom
stock, contracts, calls or other rights to purchase or acquire from WAC any such
shares.
(c) Seller shall have all requisite power, authority and capacity to
enter into this Agreement and to perform all acts required to consummate the
sale of the Option Shares to BCG in accordance with the terms hereof and to
fulfill such Seller's obligations under this Agreement.
9. Legends. At the request of BCG, each certificate representing Option
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Shares shall bear a legend in substantially the following form;
"The shares represented by this certificate are subject to a put and
purchase option, restrictions on transfer and other provisions set forth in
an option agreement dated November 1, 1996 between Boston Communications
Group, Inc. and Robert B. Sproul, a copy of which will be furnished to the
holder of this certificate by the Company upon written request without
charge."
10. Agreement Binding; Assignment. The provisions of this Agreement shall
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inure to the benefit of and be binding upon the parties hereto and their
respective successors, permitted assigns and legal representatives. This
Agreement shall not be assignable by any party hereto without the prior written
consent of BCG, WAC and Seller. Notwithstanding the foregoing, Seller may assign
its rights under this agreement to a wholly owned corporation, or a trust or
other entity for tax planning purposes, provided that during Seller's life and
subject to any disability Seller maintains ostensible control of the trust or
other planning vehicle, and, if requested by BCG, such entity becomes a party to
this Agreement.
11. Notices. All notices, requests, demands, and other communications which
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are required or may be given pursuant to the terms of this Agreement shall be in
writing and shall be deemed delivered (a) on the date of delivery when
delivered
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by hand, (b) on the date of transmission when sent by facsimile transmission
during normal business hours with telephone confirmation for receipt, (c) one
day after dispatch when sent by overnight courier maintaining records of
receipt, or (d) three days after dispatch when sent by registered mail, postage
prepaid, return-receipt requested, all addressed as follows:
If to BCG: If to WAC:
Boston Communications Group Wireless Americans Corp.
100 Sylvan Road Gables One Tower
Woburn, MA 01801 Suite 881
Attention: Alan Bouffard, Esq. 1320 S. Dixie Hwy.
Coral Gables, Florida 33146
If to Seller:
Robert Sproul
520 Marmore Avenue
Coral Gables, Florida 33146
Attention Mr. Robert B. Sproul
12. Choice of Law. This Agreement shall be governed by the laws of the
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Commonwealth of Massachusetts, (other than its laws respecting choice of law).
13. Counterparts. This Agreement may be executed in several
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counterparts, each of which shall be in original but all of which shall
constitute one and the same Agreement.
14. Amendment. This Agreement may not be amended without the prior
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written consent of BCG and Seller.
15. Validity. If any provision of this Agreement shall for any reason
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be held invalid or unenforceable, such invalidity or enforceability shall not
effect any other provision hereof and this agreement shall be construed as if
such invalid or unenforceable provision were omitted.
16. Entire Agreement. This Agreement constitutes the entire agreement
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between the parties hereto with respect to the subject matter hereof, and
supersedes and replaces in its entirety the Initial Option Agreement.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first written above.
BCG:
Boston Communications Group, Inc.
By: /s/ George K. Hertz
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Name: George K. Hertz
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Title: President
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WAC:
Wireless Americas Corp.
By: /s/ Robert B. Sproul
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Name: Robert B. Sproul
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Title: President
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SELLER:
By: /s/ Robert B. Sproul
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Robert Sproul
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