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EXHIBIT 4.6
VOTING AND STOCK TRANSFER RESTRICTION AGREEMENT
This VOTING AND STOCK TRANSFER RESTRICTION AGREEMENT (this "Agreement),
dated as of February 11, 2000 (this "Agreement"), is made and entered into among
World Access, Inc., a Delaware corporation ("WAXS"), and Roger B. Abbott and
Rosalind Abbott (Roger B. Abbott and Rosalind Abbott are sometimes referred to
collectively herein as "Stockholder").
WHEREAS, WAXS and Communication TeleSystems International d/b/a
WORLDxCHANGE Communications ("CTI") propose to enter into an Agreement and Plan
of Merger, dated as of the date hereof (as the same may be amended or
supplemented, the "Merger Agreement"; capitalized terms used but not defined
herein shall have the meanings set forth in the Merger Agreement), providing for
a business combination between WAXS and CTI (the "Transaction"), upon the terms
and subject to the conditions set forth in the Merger Agreement;
WHEREAS, Roger B. Abbott and Rosalind Abbott jointly own 14,214,857
shares of CTI Common Stock (such shares of CTI Common Stock, together with any
other shares of CTI capital stock of which Stockholder acquires beneficial
ownership after the date hereof and during the term of this Agreement whether
upon the exercise of options, warrants or rights, the conversion or exchange of
convertible or exchangeable securities, or by means of purchase, dividend,
distribution or otherwise, being collectively referred to herein as the "CTI
Subject Shares"); and
WHEREAS, as a condition to its willingness to enter in the Merger
Agreement, WAXS has requested that Stockholder enter into this Agreement;
NOW, THEREFORE, in consideration of the premises and the
representations, warranties and agreements contained herein, the parties agree
as follows:
1. Representations and Warranties of Stockholder. Except as set
forth on Schedule 1 attached hereto, Stockholder hereby represents and warrants
to WAXS as follows:
(a) Authority; No Conflicts. Stockholder has the legal
capacity and all requisite power and authority to enter into this
Agreement, to perform its obligations hereunder and to consummate the
transactions contemplated hereby. This Agreement has been duly
authorized, executed and delivered by Stockholder and constitutes a
valid and binding obligation of Stockholder enforceable in accordance
with its terms. No filing with, and no permit, authorization, consent
or approval of, any governmental authority or any other person is
necessary for the execution of this Agreement by Stockholder and the
consummation by Stockholder of the transactions contemplated hereby and
none of the execution and delivery of this Agreement by Stockholder,
the consummation of the transactions contemplated hereby or compliance
with the terms hereof by Stockholder will conflict with, or result in
any violation of, or default (with or without notice or lapse of time
or both) under any provision of any agreement to which Stockholder is a
party, including any voting agreement, stockholders agreement, voting
trust, trust agreement,
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pledge agreement, loan or credit agreement, note, bond, mortgage,
indenture, lease or other agreement, instrument, permit, concession,
franchise or license or violate any judgment, order, notice, decree,
statute, law, ordinance, rule or regulation applicable to Stockholder
or to its property or assets except (i) where the failure to make such
filings or obtain such permits, authorizations, consents or approvals
would not prevent or delay the performance by Stockholder of its
obligations under this Agreement or (ii) for any such conflicts,
violations, defaults or other occurrences that would not prevent or
delay the performance by Stockholder of its obligations under this
Agreement.
(b) CTI Subject Shares. Stockholder is the record and
beneficial owner of, and has good and marketable title to, 14,214,857
shares of CTI Common Stock, free and clear of any encumbrances,
agreements, adverse claims, liens or other arrangements with respect to
the ownership of or the right to vote or dispose of such shares of CTI
Common Stock. Other than such shares of CTI Common Stock, Stockholder
does not beneficially or of record own any shares of CTI capital stock
or securities convertible or exchangeable for shares of CTI capital
stock. Stockholder has the sole right and power to vote and dispose of
such shares of CTI Common Stock. None of such shares of CTI Common
Stock are subject to any voting trust or other agreement, arrangement
or restriction with respect to the voting or transfer of any of the
shares of CTI Common Stock, except as contemplated by this Agreement.
(c) CTI Stock Options. Neither Roger B. Abbott nor
Rosalind Abbott own any CTI Stock Options.
2. Covenants of Stockholder. Until the termination of this
Agreement in accordance with Section 4 hereof, Stockholder agrees as follows:
(a) Voting of CTI Subject Shares. At any meeting of
stockholders of CTI or at any adjournment thereof or in any other
circumstances upon which Stockholder's vote, consent or other approval
(including by written consent) is sought, Stockholder shall vote all of
the CTI Subject Shares then beneficially owned by Stockholder (i) in
favor of the Transaction and the adoption and approval of the Merger
Agreement and each of the other transactions contemplated by the Merger
Agreement and (ii) against any action or agreement that would result in
a material breach of any covenant, representation or warranty or any
other obligation or agreement of CTI under the Merger Agreement.
Stockholder shall not hereafter, unless and until this Agreement
terminates pursuant to Section 4 hereof, purport to grant any proxy or
power of attorney with respect to any of the CTI Subject Shares,
deposit any of the CTI Subject Shares into a voting trust or enter into
any agreement (other than this Agreement), arrangement or understanding
with any person, directly or indirectly, to vote, grant any proxy or
give instructions with respect to the voting of any of the CTI Subject
Shares. Stockholder further agrees not to commit or agree to take any
action inconsistent with the foregoing.
(b) Pre-Closing Transfer Restrictions. Except as
contemplated by this Agreement or the Merger Agreement, Stockholder
agrees not to (i) sell, hypothecate, transfer, pledge, encumber, assign
or otherwise dispose of (including by gift)
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(collectively, "Transfer"), or enter into any contract, option, put,
call or other arrangement or understanding (including any profit
sharing arrangement) with respect to the Transfer of, any of the CTI
Subject Shares to any person, (ii) trade or take any position, hedge or
otherwise, with respect to the CTI Subject Shares, (iii) enter into any
voting arrangement or understanding, whether by proxy, voting agreement
or otherwise, with respect to any of the CTI Subject Shares or (iv)
take any action that would make any of its representations or
warranties contained herein untrue or incorrect to a material extent or
have the effect of preventing or materially impeding Stockholder from
performing any of its obligations under this Agreement. Notwithstanding
the foregoing, Stockholder may Transfer any of the CTI Subject Shares
to any person who (x) is, at the time of such Transfer, already subject
to an agreement with WAXS substantially identical in form and substance
hereto (in which case, the CTI Subject Shares subject to the Transfer
shall be governed by such substantially identical agreement) or (y)
delivers to WAXS a counterpart of this Agreement duly executed by such
person and otherwise agrees to be bound by all the terms and conditions
hereof, and WAXS is otherwise reasonably satisfied that this Agreement
is fully enforceable against such person; provided, however, that
Stockholder shall not be entitled to Transfer any of the CTI Subject
Shares unless immediately following such Transfer, the aggregate number
of CTI Subject Shares subject to the terms and conditions hereof and/or
to the terms and conditions of a substantially identical agreement or
agreements with WAXS shall be at least equal to the aggregate number of
CTI Subject Shares which are subject to the terms and conditions of
this Agreement as of the date of the Merger Agreement.
(c) Post-Closing Transfer Restrictions. Until six (6)
months following the Effective Time, Stockholder agrees not to (i)
Transfer or enter into any contract, option, put, call or other
arrangement or understanding (including any profit sharing arrangement)
with respect to the Transfer of any of the shares of WAXS Common Stock
issued to Stockholder pursuant to the Merger Agreement to any person,
or (ii) trade or take any position, hedge or otherwise, with respect to
the shares of WAXS Common Stock issued to Stockholder pursuant to the
Merger Agreement. Notwithstanding the foregoing, Stockholder shall be
entitled to enter into one or more Qualifying Transactions (as defined
below). If, on or prior to fifteen (15) days following the Effective
Time (the "Sale Deadline"), (i) Stockholder shall have complied with
its covenants set forth below in this Section 2(c), and (ii)
Stockholder shall not have sold shares of WAXS Common Stock acquired by
Stockholder pursuant to the Merger Agreement to a third party or third
parties unrelated to WAXS (within the meaning of Treas. Reg. Sec. 1.368
3(e)(3)) for a per share price equal to at least the Resale Price (as
defined below), in one or more transactions (each, a "Qualifying
Transaction"), and (iii) the aggregate Gross Cash Proceeds (as defined
below) to Stockholder of all such Qualifying Transactions are less than
$30,000,000, then Stockholder shall have the right to sell, subject to
compliance with the provisions below in this Section 2(c), WAXS Common
Stock which yields Gross Cash Proceeds equal to not more than the
Unsold Amount (as defined below). Stockholder shall give WAXS written
notice promptly after the consummation of any Qualifying Transaction.
Stockholder shall be obligated to accept any bona fide offer for, and
use commercially reasonable efforts to consummate on or prior to the
Sale Deadline, one or more Qualifying Transactions which provide for a
per share price at least equal to
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the Resale Price resulting in aggregate Gross Cash Proceeds to
Stockholder of up to $30,000,000. If Stockholder shall be entitled to
sell shares of WAXS Common Stock in respect of any Unsold Amount
pursuant to this Section 2(c), Stockholder shall give written notice to
WAXS so stating (and stating the number of shares of WAXS Common Stock
that Stockholder is so entitled to sell) not less than five days prior
to any such permitted sale of shares of WAXS Common Stock. As used
herein, (i) the "Resale Price" equals (x) the market price of WAXS
Common Stock as of the time a written commitment to purchase shares of
WAXS Common Stock has been received by Stockholder (the "Commitment
Price") or (y) a variable price equal to the market price of WAXS
Common Stock at the time of the closing of the applicable Qualifying
Transaction, provided that such price is between fifteen percent (15%)
below or fifteen percent (15%) above the Commitment Price; (ii) the
"Unsold Amount" means the difference between $30,000,000 and the Gross
Cash Proceeds to Stockholder of all Qualifying Transactions competed
prior to the Sale Deadline; and (iii) "Gross Cash Proceeds" means the
gross cash proceeds to Stockholder from the consummation of any
Qualifying Transaction hereunder, net of reasonable and customary
expenses incurred by Stockholder in connection with such transaction
(but not net of any taxes incurred by Stockholder in connection with
any such Qualifying Transaction).
3. No Ownership Interest. Except as set forth in Section 2,
nothing contained in this Agreement shall be deemed to vest in anyone other than
Stockholder any direct or indirect ownership or incidents of ownership of or
with respect to any of the CTI Subject Shares. All rights, ownership and
economic benefits of and relating to the CTI Subject Shares shall remain and
belong to Stockholder, and no one shall have any authority to manage, direct,
restrict, regulate, govern, or administer any of the policies or operations of
CTI or exercise any power or authority to direct the voting of any of the CTI
Subject Shares as a result of this Agreement, except to the extent set forth in
Section 2(a).
4. Assignment. Except as otherwise specifically provided herein,
neither this Agreement nor any of the right, interests or obligations hereunder
may be assigned by any of the parties hereto without the prior written consent
of the other parties hereto.
5. Termination. This Agreement shall terminate, and no party
hereto shall have any rights or obligations hereunder, upon the earlier to occur
of (i) the termination of the Merger Agreement pursuant to Article IX thereof or
(ii) the lapse of the restrictions set forth in Section 2(c) hereof.
6. General Provisions.
(a) Amendments. This Agreement may not be amended except
by an instrument in writing signed by each of the parties hereto.
(b) Notices. All notices, requests, claims, demands and
other communications hereunder shall be in writing and shall be given
(and shall be deemed to have been duly given upon receipt) by delivery
in person, by telecopy or by registered or certified mail
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(postage prepared, return receipt requested) to the respective parties
at the following addresses (or at such other address for a party as
shall be specified by like notice):
if to Stockholder, to:
9999 Willow Creek Road
San Diego, California 92131
Facsimile: (858) 452-3780
with a copy to:
O'Melveny & Myers LLP
610 Newport Center Drive
17th Floor
Newport Beach, California 92660
Attention: David A. Krinsky, Esq.
Facsimile: (949) 823-6994
if to WAXS, to:
Resurgens Plaza, Suite 2210
945 East Paces Ferry Road
Atlanta, GA 30326
Attention: W. Tod Chmar
Facsimile: (404) 233-2280
with a copy to:
Long Aldridge & Norman LLP
303 Peachtree Street, Suite 5300
Atlanta, Georgia 30308
Attention: H. Franklin Layson
Facsimile: (404) 527-4198
(c) Interpretation. When a reference is made in this
Agreement to Sections, such reference shall be to a Section of this
Agreement unless otherwise indicated. The headings contained in this
Agreement are for reference purposes only and shall not affect in any
way the meaning or interpretation of this Agreement. Wherever the words
"include", "includes" or "including" are used in this Agreement, they
shall be deemed to be followed by the words "without limitation".
(d) Counterparts. This Agreement may be executed in two
or more counterparts, all of which shall be considered one and the same
agreement, and shall become effective when one or more of the
counterparts have been signed by each of the
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parties and delivered to the other party, it being understood that each
party need not sign the same counterpart.
(e) Governing Law. This Agreement shall be governed by,
and construed in accordance with, the laws of the State of Delaware
regardless of the laws that might otherwise govern under applicable
principles of conflicts or law.
(f) Severability. If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced by any
rule or law, or public policy, all other conditions and provisions of
this Agreement shall nevertheless remain in full force and effect so
long as the economic or legal substance of the transactions
contemplated hereby is not affected in any manner materially adverse to
any party. Upon any determination that any term or other provision is
invalid, illegal or incapable of being enforced, the parties hereto
shall negotiate in good faith to modify this Agreement so as to effect
the original intent of the parties as closely as possible in an
acceptable manner to the end that the transactions contemplated hereby
are fulfilled to the extent possible.
7. Enforcement. The parties agree that irreparable damage would
occur in the event that any of the provisions of this Agreement were not
performed in accordance with their specific terms or were otherwise breached. It
is accordingly agreed that, in addition to any other remedy to which it may be
entitled, at law or in equity, the parties shall be entitled to the remedy of
specific performance of the covenants and agreements contained herein and
injunctive and other equitable relief.
8. Parties in Interest. This Agreement shall be binding upon and
inure solely to the benefit of each party hereto. Except as provided in the
preceding sentence, nothing in this Agreement, express or implied, is intended
to or shall confer upon any other person any rights, benefits or remedies or any
nature whatsoever under or by reason of this Agreement.
[SIGNATURES APPEAR ON FOLLOWING PAGE]
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IN WITNESS WHEREOF, Stockholder and WAXS have caused this Agreement to
be duly and validly executed as of the date first written above.
"STOCKHOLDER":
/s/ Roger Abbott
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Roger Abbott
/s/ Rosalind Abbott
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Rosalind Abbott
"WAXS":
WORLD ACCESS, INC.
By: /s/ W. Tod Chmar
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Name: W. Tod Chmar
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Title: Executive Vice President
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SCHEDULE I
1. In connection with the Security Agreement by and between CTI and Gerard
Klauer Mattison & Co., ("GKM") dated as of August 24, 1998, which was
assigned to Tel-Save Holdings, Inc. ("Tel-Save") pursuant to the Assignment
Agreement by and between GKM and Tel-Save dated as of August 25, 1999 and
which was subsequently assigned to Mark Pavol, as Trustee of that certain
D&K Grantor Retained Annuity Trust dated June 15, 1998, Mr. Abbott pledged
3,022,368 shares as security for that loan.
2. Mr. Abbott has entered into a Voting Trust Agreement with Edward Soren in
favor of Mr. Abbott for one million shares of Mr. Soren's stock of CTI
dated as of March 1, 1998.
3. Mr. Abbott has granted certain co-sale rights to Gold & Appel pursuant to
the Stock Purchase Agreement, dated September 29, 1998, by and between
Communication TeleSystems International d/b/a WORLDxCHANGE Communications,
Roger B. Abbott, Rosalind Abbott, Edward S. Soren and Gold and Appel
Transfer S.A.
4. Mr. Abbott has granted certain co-sale rights to Atocha pursuant to the
Stock Purchase Agreement, dated September 29, 1998, by and between
Communication TeleSystems International d/b/a WORLDxCHANGE Communications,
Roger B. Abbott, Rosalind Abbott, Edward S. Soren and Atocha, L.P.
5. Mr. Abbott has granted certain co-sale rights to the TVG Asian
Communications Fund pursuant to the Stock Purchase Agreement, dated August
24, 1998, by and between Communication TeleSystems International d/b/a
WORLDxCHANGE Communications, WorldxChange B.V.B.A., WXL
International-Australia, Inc., The TVG Asian Communications Fund, Warna
Gerakan Sdn Bhd, WorldxChange Pty., Ltd, and certain individuals named
therein.