EXHIBIT 10.4
EXCHANGE AGREEMENT
BY AND AMONG
THE LIMITED PARTNERS OF CLEARTEL COMMUNICATIONS LIMITED PARTNERSHIP,
CLEARTEL COMMUNICATIONS, INC., AS GENERAL PARTNER,
THE SHAREHOLDERS OF CLEARTEL COMMUNICATIONS, INC.,
AND
CGX COMMUNICATIONS, INC.
THIS EXCHANGE AGREEMENT (this "Agreement"), dated as of October 2, 1998, by
and among (i) the limited partners of Cleartel Communications Limited
Partnership, a District of Columbia limited partnership ("Cleartel LP")
signatory hereto (the "Cleartel Limited Partners"), (ii) Cleartel Inc., in its
capacity as general partner of Cleartel LP, (iii) the shareholders of Cleartel
Communications, Inc., a District of Columbia corporation ("Cleartel Inc."),
signatory hereto (the "Cleartel Shareholders"), and (iv) CGX Communications,
Inc., a Delaware corporation ("CGX").
WITNESSETH:
WHEREAS, the Cleartel Limited Partners collectively own all of the limited
partner interests in Cleartel LP (the "Cleartel LP Interests"); and
WHEREAS, the Cleartel Limited Partners wish to exchange all of the Cleartel
LP Interests held thereby for shares of the common stock, par value $.01 per
share, of CGX (the "CGX Common Stock"), and CGX wishes to issue shares of CGX
Common Stock in exchange for such Cleartel LP Interests, subject to and in
accordance with the terms and conditions set forth herein (the "Cleartel LP
Exchange") ; and
WHEREAS, the Cleartel Shareholders collectively own all of the issued and
outstanding shares of the common stock, no par value, of Cleartel Inc. (the
"Cleartel Common Stock"); and
WHEREAS, the Cleartel Shareholders wish to exchange all of the Cleartel
Common Stock held thereby for shares of CGX Common Stock, and CGX wishes to
issue shares of CGX Common Stock in exchange for such shares of Cleartel Common
Stock, subject to and in accordance with the terms and conditions set forth
herein (the "Cleartel Inc. Exchange") (the Cleartel LP Exchange and the Cleartel
Inc. Exchange herein collectively the "Exchanges").
NOW, THEREFORE, in consideration of the premises and the mutual covenants,
agreements and provisions hereinafter contained, and subject to the terms and
conditions herein, the parties to this Agreement hereby agree as follows.
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Section I
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Terms
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1.1 Upon the effective date of the Cleartel LP Exchange, each then
outstanding one percent (1%) limited partner interest in Cleartel LP held by the
Cleartel Limited Partners shall be exchanged for 5,349.7 shares of CGX Common
Stock. Each Cleartel Limited Partner thereupon shall be entitled to receive a
stock certificate or certificates representing the same number of shares of CGX
Common Stock to which such Cleartel Limited Partner is entitled to receive
pursuant to this Section 1.1.
1.2 Upon the effective date of the Cleartel LP Exchange, all of the
Cleartel Limited Partners shall be deemed to have withdrawn as limited partners
of Cleartel LP, CGX shall automatically be admitted as the sole limited partner
of Cleartel LP, and CGX shall have a ninety-nine percent (99%) limited partner
interest in Cleartel LP. Cleartel Inc., in its capacity as the sole general
partner of Cleartel LP, hereby consents to the withdrawal of the Cleartel
Limited Partners as limited partners of Cleartel LP, and to the admission of CGX
as the sole limited partner of Cleartel LP, when and as provided in the
preceding sentence.
1.3 Upon the effective date of the Cleartel Inc. Exchange, each then
outstanding share of Cleartel Common Stock shall be exchanged for 62.938 shares
of CGX Common Stock. Each Cleartel Shareholder, upon surrender to CGX of the
certificate or certificates representing the shares of Cleartel Common Stock
held thereby on or after the effective date of the Cleartel Inc. Exchange, shall
be entitled to receive a stock certificate or certificates representing the same
number of shares of CGX Common Stock specified in this Section 1.3. Until so
surrendered, each such stock certificate shall, by virtue of the Cleartel Inc.
Exchange, be deemed for all purposes to evidence ownership of the same number of
shares of CGX Common Stock.
1.4 If any certificate representing CGX Common Stock is to be issued in a
name other than that in which the Cleartel LP Interests or Cleartel Common Stock
for which it is being exchanged is registered, it shall be a condition of such
issuance that the Cleartel LP Interests or Cleartel Common Stock for which it is
being exchanged shall be in proper form for transfer and that the person
requesting such issuance shall either pay to CGX or its transfer agents any
transfer or other taxes required by reason of the issuance of certificates
representing CGX Common Stock in a name other than that of the registered holder
of the Cleartel LP Interests or Cleartel Common Stock surrendered, or establish
to the satisfaction of CGX or its transfer agents that such tax has been paid or
is not applicable.
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Section 2
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Effective Date; Termination
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2.1 The Exchanges shall be simultaneously effective as of the date first
set forth above, or upon such later date as may be specified by CGX in its
discretion.
2.2 This Agreement shall terminate without liability to any party hereto
if the Exchanges have not become effective by October 4, 1998.
[SIGNATURES APPEAR ON THE FOLLOWING PAGE]
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement, or
have caused this Agreement to be executed by their respective duly authorized
officers, all as of the date first above written.
CLEARTEL SHAREHOLDERS:
/s/ Ulysses G. Auger, Sr. /s/ Ulysses G. Auger, II
- ------------------------- ------------------------
Ulysses G. Auger, Sr. Ulysses G. Auger, II
CLEARTEL LIMITED PARTNERS
/s/ Ulysses G. Auger, Sr. /s/ Ulysses G. Auger, II
- ------------------------- ------------------------
Ulysses G. Auger, Sr. Ulysses G. Auger, II
The Bridgette Kathryn Auger Trust
The Gregory Ulysses Auger III Trust
The Alexander Robert Auger Trust
The Ulysses George Hawthorne Auger III Trust
The Nicholas William Randolph Auger Trust
The James Frederick Auger Trust
The Annabel-Rose Auger Trust
The Constandinos Ulysses Franciscos
Auger Economides Trust
The Vassiliki Illias Auger Economides Trust
The Constandina Francisca Auger Economides Trust
By: /s/ James Pedas
---------------
James Pedas, Trustee
(As to each Trust)
CLEARTEL COMMUNICATIONS, INC.
By: /s/ Ulysses G. Auger, II
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Ulysses G. Auger, II
President
CGX COMMUNICATIONS, INC.
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By: /s/ Ulysses G. Auger, II
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Ulysses G. Auger, II
President
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