Stock Purchase Agreement - Qwest Communications Corp. and NewSuperNet
STOCK PURCHASE AGREEMENT
THIS FIRST AMENDMENT TO STOCK PURCHASE AGREEMENT, dated October 22, 1997
(the 'First Amendment'), is by and between QWEST COMMUNICATIONS CORPORATION, a
Delaware corporation ('Buyer'), and NEWSUPERNET, a Colorado nonprofit
corporation (the 'Shareholder'), the sole shareholder of SuperNet, Inc., a
Colorado corporation (the 'Corporation').
A. Buyer and the Shareholder entered into a Stock Purchase Agreement
dated September 30, 1997 (the 'Agreement') under which Buyer agreed to purchase
from the Shareholder all of the issued and outstanding capital stock of the
Corporation and also agreed to purchase from the Corporation 28,000 newly issued
shares of its common stock, $.01 par value.
B. Schedule 3.16 to the Agreement sets forth certain exceptions to the
representations and warranties made by the Shareholder in Section 3.16 of the
Agreement with respect to legal proceedings.
C. Section 10.1(b) of the Agreement provides that the Shareholder
agrees to indemnify Buyer and every Affiliate (as defined in the Agreement) of
Buyer against and hold them harmless from any and all Damages (as defined in the
Agreement) that Buyer or any such Affiliate may sustain by reason of the legal
proceedings set forth on Schedule 3.16.
D. There have been further developments in the legal proceedings
originally disclosed on Schedule 3.16, and additional threatened legal
proceedings have become known to the Shareholder.
E. Buyer and the Shareholder now wish to amend Schedule 3.16 to account
for the matters referenced in paragraph D above, with the effect that Section
10.1(b) shall apply to Schedule 3.16 as amended hereby.
NOW, THEREFORE, in consideration of the foregoing, and the mutual
agreements, representations, warranties and covenants contained herein, and for
other good and valuable consideration the receipt of which is hereby
acknowledged, the parties hereto agree as follows:
1. Schedule 3.16 is hereby amended to read in its entirely as follows:
'1. During July of 1997, an informal claim which threatens litigation was
asserted against the Company by counsel for a female employee who
contends she was discriminated against in the allocation to her of
stock options under the Company's 1995 Performance Stock Option Plan.
The Company engaged a law firm to conduct an internal investigation
concerning this claim. As a result of such investigation, an offer of
settlement was made to the claimant and a second offer of settlement
was made to a second claimant. The settlement offers expired,
however, without response from either claimant. The Company has
received a formal notice and request for information from the Equal
Employment Opportunity Commission (copy attached) with respect to the
first claimant (Patricia J. Little), indicating that a claim now has
been filed. The Company intends to vigorously defend against the
allegations. The Company has executed a settlement agreement with the
second claimant (Marla Ankenman). The Company has accrued $115,000 as
a liability on the Balance Sheet in connection with these items. No
assurance can be given that such accrual will prove sufficient to
satisfy these claims in full.
2. Nine employees of the Company delivered a letter to its President on
October 17, 1997 (copy attached). The employees, none of whom are
optionholders, stated their belief that they should be included in
the Company's incentive compensation arrangements. The Company has
responded to these assertions. No formal claim has been asserted or
articulated by the nine employees, but no assurance can be given that
such a claim will not be asserted in the future.
3. A number of e-mail-messages sent internally among company employees
(copy attached) suggests that certain female employees of the Company
believe they are not treated equally with male employees at the
Company. Although no formal claim has been asserted or articulated in
this regard, no assurance can be given that such a claim will not be
asserted in the future.'
2. Each of Schedules 3.4, 3.8 and 3.15 is hereby amended by adding the
following to each as a last paragraph:
'See additional disclosures on Schedule 3.16.'
3. Schedule 3.3 is hereby amended by adding the following as a last
'Lien in favor of Advance Telecommunications, Inc., for certain
equipment. See UCC-1 attached. Secured party has acknowledged
(see e-mail message attached) that debt has been paid in full
and lien will be released.'
4. Except as specifically amended hereby, the Agreement and the
exhibits and schedules attached thereto and all terms and conditions thereof
shall remain in full force and effect, without modification.
EXECUTED on the date first set forth above.
QWEST COMMUNICATIONS CORPORATION,
a Delaware corporation
By: /s/ Robert S. Woodruff
Name: Robert S. Woodruff
Title: Executive Vice President-
Finance, Chief Financial
Officer and Treasurer
a Colorado nonprofit corporation
By: /s/ Julian Kateley
Name: Julian Kateley