Exhibit 10.2




 




AMENDMENT NO. 1 TO


ASSET PURCHASE AGREEMENT




 




AMENDMENT

NO. 1 (this “Amendment”) to Asset Purchase

Agreement (as defined below), dated as of November 27, 2002, by and among

COUNSEL SPRINGWELL COMMUNICATIONS LLC, a Delaware limited liability company (“Counsel

LLC”), WORLDXCHANGE CORP., a Delaware corporation (“WorldxChange”),

COUNSEL CORPORATION, an Ontario corporation (“Counsel Corp.”), and RSL

COM U.S.A., INC., a Delaware corporation (“Seller”).




 




RECITALS




 




WHEREAS,

Counsel LLC and Seller are parties to that certain Asset Purchase Agreement,

dated March 25, 2002 (the “Asset Purchase Agreement”), whereby Seller

agreed to sell, and Counsel LLC agreed to purchase and assume from Seller, the

Assets and Assumed Liabilities relating to the Business (“Asset Purchase”),

in accordance with sections 105(a), 363(b) and 365 and other applicable

provisions of the Bankruptcy Code and pursuant to an order of the Bankruptcy

Court dated May 23, 2003 (the “Sale Order”);




 




WHEREAS,

pursuant to Section 12.4 (Assignment) of the Asset Purchase

Agreement, Counsel LLC assigned (the “Assignment”) its rights and

obligations under the Asset Purchase Agreement to WorldxChange with effect as

of the date the motion for the Sale Order was filed (the “Assignment Date”),

and WorldxChange has accepted such Assignment; provided, that,

notwithstanding the Assignment, Counsel LLC remains jointly and severally

liable with such WorldxChange for Counsel LLC’s obligations under the Asset

Purchase Agreement;




 




WHEREAS,

the Counsel Entities have agreed to certain undertakings with respect to

payment of the Purchase Price;




 




WHEREAS,

the parties to the Asset Purchase Agreement have agreed to certain amendments

thereto, such agreement to be evidenced by this Amendment;




 




WHEREAS,

this Amendment is “Amendment No. 1” to the Asset Purchase Agreement; and




 




WHEREAS,

this Amendment shall be subject to an order of the Bankruptcy Court, in

accordance with Sections 105(a), 363(b) and 365 and other applicable provisions

of the Bankruptcy Code, as provided in an order substantially in the form

attached hereto as Exhibit

E, authorizing the

Seller to enter into this Amendment and to consummate the transactions

contemplated hereby (the “Restructured Sale Approval Order”);




 




NOW,

THEREFORE, for good and valuable consideration, the

receipt and sufficiency of which are hereby mutually acknowledged, the parties

hereto agree as follows:




 




1.             Definitions;

Interpretation.  Capitalized terms

used herein and not otherwise defined herein shall have the meanings ascribed

to such terms in the Asset Purchase Agreement. 

The term “Amendment,” as used herein, shall include the Exhibits

attached hereto.  Terms herein




 





























 




which are capitalized and italicized shall be understood to refer to

Sections and Exhibits, as the case may be, of the Asset Purchase Agreement.




 




2.             Exhibits

and Schedules.  The form of

Management Agreement, form of Note, Side Letter Agreement and form of

Subordination Agreement attached hereto as Exhibits  A, B, C  and D, shall be added to the Asset Purchase Agreement as Exhibits E, F, G and H, respectively.




 




3.             Amendments

to Certain Sections of the Asset Purchase Agreement.  The Asset Purchase Agreement shall be

amended as follows, such amendments to take effect, unless otherwise specified

in this Amendment,  on the date hereof:




 




(a)           Defined

Terms.




 




(i)            The terms “Purchaser” and

“WorldxChange” shall be deleted from existing Section 1.1 (Defined Terms) in their

entirety and the following inserted in lieu thereof:




 




““Purchaser”

shall have the meaning set forth in the first paragraph of this Agreement; provided,

however, that on and after the Assignment Date  such term shall include,

jointly and severally, WorldxChange, as assignee pursuant to Section 12.4.”




 




““WorldxChange”

shall mean WorldxChange Corp., a Delaware corporation and subsidiary of Counsel

LLC.”




 




(ii)           The following additional terms shall

be added to existing Section 1.1 (Defined Terms):




 




““Counsel

Corp.” shall mean Counsel Corporation, an Ontario corporation.”




 




““Counsel

Entities” shall mean, collectively, Counsel LLC, WorldxChange and Counsel

Corp.”




 




““Counsel

LLC” shall mean Counsel Springwell Communications LLC, a Delaware limited

liability company.




 




““Management

Agreement” shall mean the Management Agreement in the form of Exhibit E, among the

Seller, WorldxChange and Counsel LLC.”




 




““Note”

shall mean the Promissory Note in the principal amount of $3,000,000 in the

form of Exhibit F,

by Counsel LLC and WorldxChange in favor of Seller.”




 




““Side

Letter Agreement” shall mean the Letter Agreement attached hereto as Exhibit G, between

the Seller and WorldxChange.”




 




2





























 




““Subordination

Agreement” shall mean the Subordination Agreement attached hereto as Exhibit H, among the

Counsel Entities and Seller.”




 




(iii)          The term Assets, as defined in

existing Section 1.1 (Defined Terms) shall be hereby amended to

include the Carrier Identification Code “1010946”.




 




(b)           Purchase

and Sale.




 




(i)            Existing Section 2.2 (Purchase

Price) shall be deleted in its entirety and the following inserted

in lieu thereof:




 




“2.2.        Purchase Price.  In payment for the Assets, the Purchaser

shall pay, or cause to be paid, to the Seller, $13,000,000 (the “Purchase

Price”), comprised of $10,000,000 in cash, plus the Note; provided,

that the parties hereto mutually agree that the application of Section 2.3 has

resulted in a $2,500,000 downward adjustment of the cash portion of the

Purchase Price (e.g., to $7,500,000) to be paid at the Closing, as provided

in Section 10.8.”




 




(ii)           Existing Section

2.3(d) (Post-Closing

Adjustments to Purchase Price) shall be deleted in its entirety and

the following inserted in lieu thereof:




 




“(d) If the

application of Section 2.3(c) shall result in a computed downward adjustment to

the Purchase Price of more than $2,650,000, the Seller shall pay to the

Purchaser by wire transfer of immediately available funds within three (3)

Business Days of such determination, an amount equal to the difference between

(x) the Purchase Price less (y) the sum of the Final Purchase Price and

$150,000.  If the application of Section

2.3(c) shall result in a computed downward adjustment to the Purchase Price of

less than $2,350,000, the Purchaser shall pay to Seller by wire transfer of

immediately available funds within three (3) Business Days of such

determination, an amount equal to the difference between (x) the Final Purchase

Price less (y) the sum of the Purchase Price and $150,000.  For example, and without limiting the

generality of the foregoing, if the downward adjustment to the Purchase Price

based on the application of Section 2.3(c) shall result in a computed downward

adjustment (x) of $2,750,000 (e.g., the Final Purchase Price is equal to

$10,250,000), Seller shall pay $100,000 to Purchaser in accordance with the

provisions of this Section 2.3(d), (y) of $2,250,000 (e.g., the Final Purchase

Price is equal to $10,750,000), Purchaser shall pay $100,000 to Seller in

accordance with the provisions of this Section 2.3(d), or (z) falling between

$2,350,000 (e.g., the Final Purchase Price is equal to $10,650,000) and

$2,650,000 (e.g., the Final Purchase Price is equal to $10,350,000)

(inclusive), no additional payments shall be made between Seller and Buyer in

connection with a Purchase Price adjustment.”




 




3





























 




(c)           Mutual

Release.  On the Closing Date,

existing Article VIII (Indemnification) shall be deleted in its

entirety and replaced by the following:




 




“ARTICLE VIII




 




MUTUAL RELEASE




 




8.1.          Release by Seller.  Seller forever and irrevocably releases and

discharges the Counsel Entities and their respective directors, officers,

shareholders, partners, principals, affiliates, agents, successors and assigns

(all the foregoing being referred to herein as the “Counsel Releasees”)

from any and all actions, causes of action, suits, proceedings, indemnities,

liabilities, losses, bills, covenants, contracts, agreements, promises,

damages, judgments, obligations, awards, penalties, fines, claims and/or

demands whatsoever of every kind and character, whether arising in equity, at

common law or by statute, that the Seller ever had, now has or hereafter can,

shall or may have against the Counsel Releasees, or any one or more of them,

related to, arising out of, based upon, resulting from or in any way connected

with, directly or indirectly, this Agreement or the transactions contemplated

hereby, except for the transactions contemplated by Section 2.3, and each of

the Note, the Side Letter Agreement, the Management Agreement and the

Subordination Agreement.  The Seller

will not, directly or indirectly, in its own name or through another, commence

any action, litigation, suit, arbitration or other proceeding, or assert any

claim or demand, against any one or more of the Counsel Releasees in any manner

arising out of or in connection with any subject matter for which the release

and discharge set forth in this Section 8.1 is given.




 




8.2.          Release by Counsel Entities.  Each of the Counsel Entities forever and

irrevocably releases and discharges the Seller and its directors, officers,

shareholders, partners, principals, affiliates, agents, successors and assigns

(all the foregoing being referred to herein as the “Seller Releasees”)

from any and all actions, causes of action, suits, proceedings, indemnities,

liabilities, losses, bills, covenants, contracts, agreements, promises,

damages, judgments, obligations, awards, penalties, fines, claims and/or

demands whatsoever of every kind and character, whether arising in equity, at

common law or by statute, that any of the Counsel Entities ever had, now has or

hereafter can, shall or may have against the Seller Releasees, or any one or

more of them, related to, arising out of, based upon, resulting from or in any

way connected with, directly or indirectly, this Agreement or the transactions

contemplated hereby, except for the transactions contemplated by Section 2.3,

and each of the Note, the Side Letter Agreement, the Management Agreement and

the Subordination Agreement. The Counsel Entities will not, directly or

indirectly, in its own respective names or through another, commence any

action, litigation, suit, arbitration or other proceeding, or assert any claim




 




4





























 




or demand,

against any one or more of the Seller Releasees in any manner arising out of or

in connection with any subject matter for which the release and discharge set

forth in this Section 8.2 is given.




 




8.3.          Survival.  The provisions of this Article VIII shall

survive the Closing.”




 




(d)           Conditions

to the Purchaser’s Obligations.




 




(i)            Existing

Section 9.3 (No Injunction) shall be deleted in its entirety and the

following shall be inserted in lieu thereof:




 




“9.3.        No Injunction.  There shall not be any statute, rule or

regulation, enjoining or prohibiting the consummation of the Closing and no

court of competent jurisdiction shall have issued, and there shall have not

been commenced and be continuing any action by any Governmental Entity seeking,

any order, decree or ruling enjoining or prohibiting the consummation of the

Closing.  Notwithstanding the foregoing,

in no event shall the failure to obtain any of the Regulatory Requirements

constitute a condition to the Purchaser’s obligations under this Agreement to

consummate the Closing.”




 




(ii)           The following additional Sections

shall be added to existing Article IX (Conditions to the Purchaser’s Obligations):




 




“9.8.        No Casualty.  Since November 27, 2002, there shall not

have occurred any significant casualty, damage or destruction (“Casualty”)

to any of the fixed assets included in the Assets which has resulted in an

inability of the Seller to materially service its customers. “




 




9.9.          Execution of Other Agreements.

Each of the Note, the Side Letter Agreement, the Management Agreement and the

Subordination Agreement shall have been duly executed and delivered by each of

the respective parties thereto.”




 




(e)           Conditions

to the Seller’s Obligations.




 




(i)            Existing Section 10.3 (No

Injunction) shall be deleted in its entirety and the following shall

be inserted in lieu thereof:




 




“10.3.      No Injunction. There shall not be

any statute, rule or regulation, enjoining or prohibiting the consummation of

the Closing and no court of competent jurisdiction shall have issued, and there

shall have not been commenced and be continuing any action by any Governmental

Entity seeking, any order, decree or ruling enjoining or prohibiting the

consummation of the Closing. 

Notwithstanding the foregoing, in no event shall the failure to obtain

any of the Regulatory Requirements constitute a




 




5





























 




condition to

the Seller’s obligations under this Agreement to consummate the Closing.”




 




(ii)           The following additional Section

shall be added to existing Article X (Conditions to the Seller’s Obligations):




 




“10.8.      Payment of Purchase Price; Execution of

Other Agreements.  The cash portion

of the Purchase Price shall have been paid to the Seller, and each of the Note,

the Side Letter Agreement, the Management Agreement and the Subordination

Agreement shall have been duly executed and delivered by each of the respective

parties thereto.”




 




(f)            Method

of Termination.  Existing Section

11.1 (Methods

of Termination) deleted in its entirety and the following shall be

inserted in lieu thereof:




 




“11.1       Method of Termination.  This Agreement may be terminated by mutual

written agreement of the Seller and the Purchaser prior to the Closing Date”




 




(g)           Survival.  Existing Section 12.2 (Survival) shall be deleted

in its entirety and the following shall be inserted in lieu thereof:




 




“12.2       Survival.  Except for (a) the provisions set forth in

Articles II (Purchase and Sale), VIII (Mutual Release) and XII (Miscellaneous),

which shall survive the Closing; and (b) Sections 6.4 (Essential Services), 6.9 (Allocation

of Purchase Price) and 6.13 (Further Assurances), which shall survive

for ninety (90) days following the Closing, 

the statements, certifications, representations and warranties made

hereby by the parties to this Agreement, and their respective covenants, agreements

and obligations to be performed pursuant to the terms hereof, shall not

survive, and shall terminate and be of no further effect following the Closing

Date; provided,

however, that nothing herein contained shall modify or be construed

to modify in any respect whatsoever or limit the duration of any covenant,

agreement or obligation to be performed by any party hereto after the Closing

Date pursuant to the provisions of this Agreement.”




 




4.             Certain

Undertakings Regarding Payment of Purchase Price.  The Counsel Entities hereby irrevocably and unconditionally

undertake and agree to be jointly and severally liable to the Seller for the

due and punctual payment in full of the cash portion of the Purchase Price

(including, but not limited to, any adjustments pursuant to Section 2.3(c) and

2.3(d) of the Asset Purchase Agreement (Post-Closing Adjustments to Purchase Price))

when the same shall become due and payable in accordance with the appropriate

provisions of the Asset Purchase Agreement. 

In addition, each of the Counsel Entities hereby unconditionally and

irrevocably waives any defenses it may now or hereafter have in any way

relating to its obligations under this Section 4, except for the provisions of

Section 2.3(c) and 2.3(d) of the Asset Purchase Agreement (Post-Closing Adjustments to Purchase

Price) and the conditions to Closing specified in Sections 9.3 (No

Injunction), 9.6 (Bankruptcy Court Approval), 9.8 (No Casualty)




 




6





























 




and 9.9 (Execution of Other Agreements) of the Asset Purchase

Agreement.  Except with respect to the

undertakings and agreements as to payment of the cash portion of the Purchase

Price as provided for in this Section 4, nothing in this Section 4 shall affect

any other statement, certification, representation, warranty, covenant or

agreement of, or obligation to be performed by, any of the Counsel Entities,

whether individually or collectively, pursuant to the terms of the Asset

Purchase Agreement, as amended by this Amendment.  The provisions of this Section 4 shall survive the Closing.




 




5.             Conduct

of Business.




 




(a)           The

Purchaser shall perform the management of the Business related to the

Non-transferred Assets in a professional manner and in accordance with

applicable professional or industry standards throughout the Term (as defined

in the Management Agreement) of the Management Agreement and with at least the

same level of service provided by Seller immediately prior to the Closing Date.




 




(b)           The

Purchaser shall conduct the Business in a professional manner and in accordance

with applicable professional or industry standards throughout the Measurement

Period, as defined in the Note, and with at least the same level of service

provided by Seller immediately prior to the Closing Date.




 




(c)           This

provisions of this Section 5 shall survive Closing.




 




6.             Limited

Covenant Waiver.  The parties hereto

agree to waive and give no effect any breach by Seller of any of the covenants

set forth in Article VI (Covenants) as any such breach may exist as

of the date hereof, including, but not limited to any breaches by the Seller of

those covenants set forth in Sections 6.1 (Access) and 6.3 (Conduct of Business) of the

Asset Purchase Agreement.




 




7.             Limited

Waiver of Closing Conditions.




 




(a)           Purchaser

expressly waives application of all conditions to Closing set forth in Article

IX (Conditions

to the Purchaser’s Obligations) except for those conditions set

forth in Sections 9.3 (No Injunction), 9.6 (Bankruptcy Court Approval),

9.8 (No

Casualty) and 9.9 (Execution of Other Agreements) of the

Asset Purchase Agreement.




 




(b)           Seller

expressly waives application of all conditions to Closing set forth in Article

X (Conditions

to the Seller’s Obligations) except for payment of the Purchase

Price in accordance with Section 2.2 (Purchase Price) of the Asset Purchase

Agreement (including issuance of the Note) and those conditions set forth in

Sections 10.3 (No Injunction), 10.7 (Bankruptcy Court Approval) and 10.8 (Payment of

Purchase Price; Execution of Other Agreements) of the Asset Purchase

Agreement.




 




8.             Obligation

to Satisfy Certain Payroll Obligations. 

Except with respect to any Assumed PTO (as defined in the Side Letter

Agreement), which shall be treated as an Assumed Liability for purposes of the

Closing Statement, the Sellers shall, up to and including the Closing Date,

satisfy all accrued payroll obligations owing to the Accepting Employees in

accordance with the Seller’s standard payroll procedures and policies in effect

as of the date of this




 




7





























 




Amendment, and the parties agree that such accrued payroll obligations

shall not be treated as Assumed Liabilities for purposes of the Closing

Statement.




 




9.             Bankruptcy

Court Approval. This Amendment shall only become effective if (a) the Restructured

Sale Approval Order shall have been entered by the Bankruptcy Court and such

Restructured Sale Approval Order shall have not been stayed, modified, reversed

or amended in any manner adverse to the parties hereto and (b) each of the

parties hereto shall have received from the Bankruptcy Court all other orders,

approvals and consents required to transfer the Assets and the Assumed

Liabilities and to consummate the transactions contemplated by this Amendment,

and each of the parties hereto shall have received evidence thereof

satisfactory to it and its counsel.




 




10.           Closing.  The parties hereto shall use their

commercially reasonable best efforts to effectuate the Closing as soon as

practicable after the execution of this Amendment; provided, however, that

unless otherwise agreed in writing by the parties to this Amendment, if the

Closing shall not have occurred by December 12, 2002, this Amendment shall

automatically terminate, become void and have no further force and effect, and

the rights and obligations of the Purchaser and the Seller with respect to the

Asset Purchase shall be governed by the original terms of the Asset Purchase

Agreement with such effect as if the parties shall have never entered into this

Amendment.




 




11.           Continued

Existence.  Counsel Corp. represents

and warrants that it currently has no intention to commence, or cause either

Counsel LLC or WorldxChange to commence, a voluntary case under the federal

bankruptcy laws or any other applicable federal or state bankruptcy, insolvency

or similar law, as now hereinafter in effect. The provisions of this Section 11

shall survive the Closing.




 




12.           Continued

Effect.  Except for the amendments

to the Asset Purchase Agreement provided for in this Amendment, all terms,

provisions, covenants, representations, warranties, agreements and conditions

set forth in the Asset Purchase Agreement remain in full force and effect and

shall not be deemed to be waived, modified or amended hereby.




 




13.           Governing

Law.  Section 12.13 (Governing

Law; Jurisdiction) of the Asset Purchase Agreement is hereby

incorporated by reference into, and shall apply with equal force to, this

Amendment.  The provisions of this

Section 13 shall survive the Closing.




 




14.           Counterparts.  This Amendment may be executed in

counterparts, which together shall constitute one and the same Amendment.  The parties may execute more than one copy

of the Amendment, each of which shall constitute an original.




 




8





























 




IN WITNESS WHEREOF, the parties hereto have

signed this Amendment as of the date first above written.




 




	

   


  	

  COUNSEL SPRINGWELL


  COMMUNICATIONS LLC


  
	

   


  	

   


  	

   


  
	

   


  	

  By:


  	

   


  	

   


  
	

   


  	

   


  	

  Allan Silber, Chairman


  
	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  
	

   


  	

  WORLDXCHANGE CORP.


  
	

   


  	

   


  	

   


  
	

   


  	

  By:


  	

   


  	

   


  
	

   


  	

   


  	

  David Boillot, Secretary


  
	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  
	

   


  	

  COUNSEL CORPORATION


  
	

   


  	

   


  	

   


  
	

   


  	

  By:


  	

   


  	

   


  
	

   


  	

   


  	

  Allan Silber, Chairman and Chief Executive


  Officer


  
	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  
	

   


  	

  RSL COM U.S.A.,

  INC.


  
	

   


  	

   


  	

   


  
	

   


  	

  By:


  	

   


  	

   


  
	

   


  	

   


  	

  Michael Marino, President and Chief


  Executive Officer


  
					





 




9