Exhibit
2.1
EXECUTION
COPY
AMENDMENT
TO STOCK PURCHASE AGREEMENT
This
Amendment to the Stock Purchase Agreement (this “Amendment”) is made and entered
into as of this 31st
day of
January, 2006, by and between Telkonet Inc., a Utah corporation (“Purchaser”)
and Frank T. Matarazzo, an individual and resident of the state of New Jersey
(“Seller”). Capitalized terms used herein and not otherwise defined shall have
the meanings given to such terms in the Stock Purchase Agreement (as hereinafter
defined).
RECITALS
WHEREAS,
Purchaser
and Seller have entered into a December 5, 2005 Stock Purchase Agreement (the
“Stock Purchase Agreement”) with respect to the sale by Seller to Purchaser of
125 shares of common stock without par value of Microwave Satellite Technologies
Inc. (the “Company”); and
WHEREAS,
Purchaser and Seller now desire to amend the terms of the Stock Purchase
Agreement as hereinafter set forth.
NOW
THEREFORE,
in
consideration of the mutual covenants and provisions set forth in this
Agreement, Seller and Purchaser agree as follows:
1. Section
8.2 Indemnification
by Seller
of the
Stock Purchase Agreement is hereby amended to add the following subsection
(c):
(c) notwithstanding
the breach or inaccuracy of any representation or warranty made by Seller in
this Agreement or the breach by the Company or Seller to perform any covenant
or
obligation by Seller or the Company contained in this Agreement, any
disallowance or recharacterization of any deductions taken by the Company on
any
Tax Returns by the Internal Revenue Service or other relevant Governmental
Entity.
2. Section
8.4 of the Stock Purchase Agreement is hereby amended, replaced and superseded
in its entirety as follows:
Limitations
on Liability of Seller.
Notwithstanding any other provision of this Agreement or any right or remedy
available under any law, from and after the Closing;
(a) The
Purchaser Indemnified Parties shall have the right to payment by the Seller
under Section 8.2 only if, and only to the extent that, the Purchaser
Indemnified Parties shall have incurred an aggregate indemnifiable Loss in
excess of $400,000.00 and then only for the amount by which such aggregate
indemnifiable Loss exceeds $400,000.00.
(b) Purchaser’s
recourse against Seller for any claims under this Agreement shall be limited
to
recovery by Purchaser of not more than 600,000 shares of the Stock Consideration
except as hereinafter expressly set forth; provided that with respect to the
indemnification obligation of Seller pursuant to Section 8.2(c), Seller shall
pay to Purchaser the amount of any refund, offset or credit, received by Seller,
or to which Seller becomes entitled with respect to his personal federal and
state taxes as the result of any liability (after taking into account the
limitations on Seller liability pursuant to Section 8.4(a)) to which the Company
becomes subject that is indemnifiable pursuant to Section 8.2(c) and that
Purchaser shall be entitled to recourse against Seller with respect to the
600,000 shares of Stock Consideration with regard to the indemnification
obligation of Seller pursuant to Section 8.2(c) only if, and to the extent
that,
such personal tax refund, offset or credit is insufficient to fully indemnify
Purchaser; and provided further that there shall be no limit on the amount
or
nature of the liability of Seller for intentional fraud by Seller.
3. Except
as
otherwise expressly set forth in this Amendment, all terms and provisions of
the
Stock Purchase Agreement shall remain in full force and affect.
4. This
Amendment shall be deemed to be made in and in all respects shall be
interpreted, construed and governed by and in accordance with the laws of the
State of New Jersey without regard to the conflict of law principles thereof.
The parties hereby irrevocably submit to the exclusive jurisdiction of the
Federal courts of the United States of America located in the State of New
Jersey solely in respect of the interpretation and enforcement of the provisions
of this Amendment, and hereby waive, and agree not to assert, as a defense
in
any action, suit or proceeding for the interpretation or enforcement hereof
that
it is not subject thereto or that such action, suit or proceeding may not be
brought or is not maintainable in said courts or that the venue thereof may
not
be appropriate or that this Amendment may not be enforced in or by such courts,
and the parties hereto irrevocably agree that all claims with respect to such
action or proceeding shall be heard and determined in such Federal court. The
parties hereby consent to and grant any such Federal court jurisdiction over
the
person of such parties and over the subject matter of such dispute and agree
that mailing of process or other papers in connection with any such action
or
proceeding in the manner provided in Section 12.1 of the Stock Purchase
Agreement or in such other manner as may be permitted by law, shall be valid
and
sufficient service thereof.
5. No
waiver
by any party of any provision hereof shall be deemed a waiver of any other
provision hereof or of any subsequent breach by any party of the same or any
other provision. This Amendment may be amended only by a writing executed by
each of the Parties hereto.
6. This
Amendment may be executed simultaneously in any number of counterparts, each
of
which shall be deemed an original, but all of which shall constitute one and
the
same instrument.
IN
WITNESS WHEREOF, the parties have executed this Amendment as of the day and
year
first written above.
/s/
Frank T. Matarazzo______________________
Frank
T.
Matarazzo
Telkonet
Inc.
By:
/s/ E. Barry Smith_______________________
E.
Barry
Smith
Chief
Financial Officer