STOCK TRANSFER AGREEMENT
This Stock Transfer Agreement (the "AGREEMENT") is made as of June 10, 1997
between Retix, a California corporation ("RETIX"), Vertel Corporation, a
California corporation ("VERTEL") and Wireless Solutions, a California
Retix is the sole shareholder of Wireless and the majority shareholder
of Vertel. Retix, Wireless and Vertel wish to engage in a series of
transactions pursuant to which (1) Retix will transfer to Vertel all of the
shares of capital stock of Wireless held by Retix (which transfer shall be
treated as a capital contribution by Retix to Vertel), (2) Vertel will issue
to Retix shares of Vertel's Preferred Stock, and (3) Wireless will assign to
Retix cash in the amount of $1,000,000 (which funds shall be used to retire
an equivalent amount of indebtedness of Vertel to Retix).
In consideration of the mutual promises contained in this Agreement, and
for other good and valuable consideration, receipt of which is hereby
acknowledged, Vertel and Retix hereby agree as follows:
1. CLOSING. The closing of the transactions contemplated hereby (the
"CLOSING") shall take place immediately upon the execution of this document
by both parties, or such other date as the parties hereto shall mutually
agree. The date of the Closing is hereinafter referred to as the "CLOSING
2. TRANSFER OF WIRELESS SHARES TO VERTEL.
(a) CAPITAL CONTRIBUTION. At the Closing, Retix shall transfer to
Vertel an aggregate of 17,000,000 shares (the "WIRELESS SHARES") of Wireless'
Preferred Stock, representing all of the issued and outstanding shares of
Wireless, which transfer shall be treated as a capital contribution by Retix to
Vertel. At the Closing, subject to the terms and conditions of this Agreement,
Retix shall deliver to Vertel a certificate or certificates representing the
Wireless Shares, registered in the name of Retix, duly endorsed by Retix for
transfer to Vertel or accompanied by an Assignment Separate from Certificate
duly executed by Retix in favor of Vertel. On submission of the certificate or
certificates to Wireless for transfer, Wireless shall cause to be issued to
Vertel a certificate representing the Wireless Shares, registered in the name of
(b) INVESTMENT REPRESENTATIONS. The agreement to transfer the
Wireless Shares is made in reliance upon Vertel's representation to Retix, which
by Vertel's execution of this Agreement, Vertel hereby confirms, that the
Wireless Shares and the shares of Common Stock issuable upon conversion of the
Wireless Shares (collectively, the "SECURITIES") to be acquired by Vertel will
be acquired for investment for Vertel's own account, not as a nominee or agent,
and not with a view to the resale or distribution of any part thereof, and that
Vertel has no present intention of selling, granting any participation in, or
otherwise distributing the same.
Vertel understands that the Securities have not been, and will not be,
registered under the Securities Act, by reason of a specific exemption from
the registration provisions of the Securities Act which depends upon, among
other things, the bona fide nature of the investment intent and the accuracy
of Vertel's representations as expressed herein. Vertel understands that the
Securities are characterized as "RESTRICTED SECURITIES" under the federal
securities laws inasmuch as they are being acquired from Retix in a
transaction not involving a public offering and that under such laws and
applicable regulations such Securities may be resold without registration
under the Securities Act only in certain limited circumstances. Vertel is
aware of the provisions of Rule 144 promulgated under the Securities Act
which permit limited resale of securities purchased in a private placement
subject to the satisfaction of certain conditions. Vertel understands that
no public market now exists for any of the securities issued by Retix, that
Retix has made no assurances that a public market will ever exist for the
(c) LEGENDS. Vertel authorizes Wireless and its agents to place on
each certificate for Wireless Shares which Vertel may receive pursuant to
this Agreement a legend stating that such Wireless Shares have not been
registered under the Act or any state securities law and setting forth the
aforementioned restrictions on transfer, including the following legends:
(i) "THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE BEEN
ACQUIRED FOR INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933. SUCH SHARES MAY NOT BE SOLD, TRANSFERRED OR PLEDGED IN THE ABSENCE
OF SUCH REGISTRATION OR UNLESS THE COMPANY RECEIVES AN OPINION OF COUNSEL
(WHICH MAY BE COUNSEL FOR THE COMPANY) REASONABLY ACCEPTABLE TO IT STATING
THAT SUCH SALE OR TRANSFER IS EXEMPT FROM THE REGISTRATION AND PROSPECTUS
DELIVERY REQUIREMENTS OF SAID ACT."
(ii) Any other legend required by the California Commissioner
of Corporations and any other state securities law.
3. ISSUANCE OF VERTEL SHARES TO RETIX.
(a) ISSUANCE; DELIVERY. At the Closing, Vertel shall issue to Retix
an aggregate of 1,423,500 shares of Vertel's Preferred Stock (the "VERTEL
SHARES," and collectively with the Wireless Shares, the "SHARES"). At the
Closing, Vertel will deliver to Retix a certificate or certificates representing
the Vertel Shares.
(b) INCORPORATION BY REFERENCE. Vertel and Retix are also parties to
a Preferred Stock Purchase Agreement dated June 10, 1997 (the "STOCK PURCHASE
AGREEMENT"). The terms of Sections 3 ("Representations and Warranties of the
Company"), Section 4 ("Representations and Warranties of the Purchaser"),
Section 5 ("Conditions to Closing of Purchaser"), Section 6 ("Conditions to
Closing of Company") and Section 7 ("Affirmative Covenants of the Company") are
incorporated into this Agreement by reference. The term "Purchaser" as used in
such sections shall refer to Retix, the term "Company" as used in such sections
shall refer to Vertel, and the terms "Shares" and "Preferred" as used in such
sections shall refer to the Vertel Shares.
4. ASSIGNMENT. In contemplation of the transfer of the Wireless Shares
pursuant to this Agreement and the consolidation of Wireless and Vertel,
Wireless hereby assigns and conveys to Retix cash in the aggregate amount of
$1,000,000. Such funds shall be used by Retix to retire an equivalent amount of
indebtedness of Vertel to Retix.
5. NO REPRESENTATIONS OR WARRANTIES. Except as expressly provided in
this Agreement, no representations or warranties are given by any party with
respect to any of the businesses of the parties hereto (whether their own
respective businesses or that of any other party). Each party represents that
it has a full understanding of the respective businesses of the parties hereto
and has received all information requested in connection with the transactions
contemplated by this Agreement. As such, except as expressly provided in this
Agreement, all transactions that are the subject of this Agreement shall be
deemed to be on an "as is" basis.
6. WIRELESS CONSENT. Wireless fully consents to the transfer of the
Wireless Shares under this Agreement, but makes no representation or warranty
as to the legality of the transfer of the Wireless Shares hereunder.
(a) GOVERNING LAW. This Agreement and all acts and transactions
pursuant hereto and the rights and obligations of the parties hereto shall be
governed, construed and interpreted in accordance with the laws of the State
of California, without giving effect to principles of conflicts of law.
(b) ENTIRE AGREEMENT; ENFORCEMENT OF RIGHTS. Except as expressly set
forth herein, this Agreement sets forth the entire agreement and
understanding of the parties relating to the subject matter herein and merges
all prior discussions between them. No modification of or amendment to this
Agreement, nor any waiver of any rights under this Agreement, shall be
effective unless in writing signed by the parties to this Agreement. The
failure by either party to enforce any rights under this Agreement shall not
be construed as a waiver of any rights of such party.
(c) SEVERABILITY. If one or more provisions of this Agreement are
held to be unenforceable under applicable law, the parties agree to
renegotiate such provision in good faith. In the event that the parties
cannot reach a mutually agreeable and enforceable replacement for such
provision, then (i) such provision shall be excluded from this Agreement,
(ii) the balance of the Agreement shall be interpreted as if such provision
were so excluded and (iii) the balance of the Agreement shall be enforceable
in accordance with its terms.
(d) CONSTRUCTION. This Agreement is the result of negotiations
between and has been reviewed by each of the parties hereto and their
respective counsel, if any; accordingly, this Agreement shall be deemed to be
the product of all of the parties hereto, and no ambiguity shall be construed
in favor of or against any one of the parties hereto.
(e) NOTICES. Any notice required or permitted by this Agreement
shall be in writing and shall be deemed sufficient when delivered personally
or sent by telegram or fax or forty-eight (48) hours after being deposited in
the U.S. mail, as certified or registered mail, with postage prepaid, and
addressed to the party to be notified at such party's principal executive
office or as subsequently modified by written notice.
(f) COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original and all of which
together shall constitute one instrument.
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The parties hereto have executed this Agreement as of the date first set
RETIX, VERTEL CORPORATION,
a California Corporation a California Corporation
a California corporation