VOTING AGREEMENT
THIS VOTING AGREEMENT (this "Agreement"), dated as of August 16, 1999,
is between Communication TeleSystems International, a California corporation
(the "Company"), and Gold & Appel Transfer S.A. (the "Investor").
WHEREAS, the Investor proposes to purchase 30,000 shares of Series A
Convertible Preferred Stock (the "Series A Stock") pursuant to that certain
Stock Purchase Agreement, dated as of August 16, 1999 (the "Purchase
Agreement"), upon the terms and subject to the conditions set forth in the
Purchase Agreement; and
WHEREAS, it is a condition to the purchase and sale of the Series A
Stock under the Purchase Agreement that the parties enter into this Agreement.
NOW, THEREFORE, the parties hereto agree as follows:
1. VOTING. Investor hereby agrees that, at all times and for so
long as Investor has the option to convert, but has not converted, any shares of
Series A Stock pursuant to Section 8(A) of the Certificate of Determination of
Preferences relating to the Series A Stock, to vote all of such shares of Series
A Stock owned or held beneficially by Investor in favor of, and to take such
other action as may be reasonably necessary or appropriate to approve, any
recapitalization, consolidation or merger of the Company with or into another
corporation or entity, and/or the sale of all or substantially all of the assets
of the Company to another corporation or entity, so long as such
recapitalization, consolidation, merger or sale has been duly approved or
consented to by the Board of Directors of the Company. Nothing herein shall be
deemed or construed as conferring on Investor any voting or approval rights to
which Investor is not otherwise entitled under applicable law.
2. TRANSFEREES. Investor agrees that it shall not convey, assign or
otherwise transfer any shares of the Series A Stock to any transferee as
permitted under Section 5.3 of the Purchase Agreement unless the transferee or
transferees thereof execute a written agreement, which shall be reasonably
satisfactory to the Company, under which such transferee or transferees agree to
perform the obligations of Investor hereunder with respect to all shares of
Series A Stock so transferred as if such transferee or transferees were a party
or parties to this Agreement.
3. SEVERABILITY. The provisions of this Agreement are severable.
The invalidity, in whole or in part, of any provision of this Agreement shall
not affect the validity or enforceability of any other of its provisions. If
one or more provisions hereof shall be so declared invalid or unenforceable, the
remaining provisions shall remain in full force and effect and shall be
construed in the broadest possible manner to effectuate the purposes hereof.
The parties further agree to replace such void or unenforceable provisions of
this Agreement with valid and enforceable provisions which will achieve, to the
extent possible, the economic, business and other purposes of the void or
unenforceable provisions.
4. AMENDMENT. The provisions of this Agreement may not be amended,
modified or supplemented except in a writing executed by the Company and
Investor.
5. INJUNCTIVE RELIEF. Without intending to limit the remedies
available to any party, the parties hereto acknowledge that a breach of any of
the covenants contained in this Agreement may result in material irreparable
injury to the other parties for which there is no adequate remedy at law, that
it will not be possible to measure damages for such injuries precisely and that,
in the event of such a breach or threat thereof, the other parties, or any of
them, shall be entitled to obtain a temporary
restraining order and a preliminary or permanent injunction restraining or
requiring actions prohibited or required by this Agreement or such other
relief as may be required to enforce specifically any of the covenants of
this Agreement.
6. ATTORNEYS' FEES. In any action at law or in equity to enforce
any of the provisions or rights under this Agreement, the unsuccessful party to
such litigation, as determined by the court in a final judgment or decree, shall
pay the successful party all costs, expenses and reasonable attorneys' fees, as
set by the court and not by a jury, incurred by the successful party (including,
without limitation, costs, expenses and fees on any appeal).
7. CALIFORNIA LAW. This Agreement shall be construed in accordance
with and governed by the laws of the State of California, without regard to
conflicts of law provisions.
8. SUCCESSORS. This Agreement shall be binding upon and shall inure
to the benefit of the parties hereto and their respective legal representatives,
successors and assigns, except to the extent herein expressly limited.
9. LEGENDS. A legend in substantially the following form (or
containing substantially the same information as set forth in the following
form) shall be inscribed on all the certificates representing shares of stock
subject to this Agreement.
"The shares represented by this certificate are subject to a
Voting Agreement dated as of August 16, 1999 between the
owner of the shares represented by this certificate and the
Corporation. The Corporation will furnish a copy of such
agreement to any person without charge upon written request
to the Corporation at its principal office."
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10. COPIES OF VOTING AGREEMENT. The Company agrees to make available
to any shareholder of the Company, upon request, a copy of this Agreement to the
extent then required by California law.
11. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same agreement.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed as of the date first above written.
THE COMPANY:
Communication TeleSystems International,
a California corporation
By: /s/ Edward S. Soren
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Title: Executive Vice President
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INVESTOR:
GOLD & APPEL TRANSFER S.A.,
a British Virgin Islands Corporation
By: /s/ [ILLEGIBLE]
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Title: Power of Attorney in Fact
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