Exhibit 2.6
ASSET PURCHASE AGREEMENT
between
ILLINOIS CONSOLIDATED TELEPHONE COMPANY
and
ODIN TELEPHONE EXCHANGE, INC.
dated
June 14, 2001
TABLE OF CONTENTS
ARTICLE I......................................................................1
Agreement to Sell and Purchase Assets.......................................1
1.1 PERSONAL PROPERTY...............................................1
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1.2 REAL PROPERTY...................................................2
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1.3 EXCLUDED ASSETS.................................................2
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ARTICLE II.....................................................................2
Purchase Price for Personal Property and Real Property......................2
2.1 PURCHASE PRICE..................................................2
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2.2 PAYMENT OF PURCHASE PRICE.......................................3
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2.3 ALLOCATION OF PURCHASE PRICE....................................3
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ARTICLE III....................................................................3
Prorations, Closing Expenses and Other Adjustments..........................3
PRORATIONS AND EXPENSES OF CLOSING.......................................3
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ARTICLE IV.....................................................................3
Assumption of Liabilities...................................................3
4.1 ASSUMPTION......................................................3
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4.2 NON-ASSUMPTION..................................................3
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ARTICLE V......................................................................4
Regulatory Consents.........................................................4
5.1 APPLICATIONS TO THE ICC AND THE FCC.............................4
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5.2 ICC AND FCC APPROVAL............................................4
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5.3 OTHER REGULATORY APPROVALS......................................4
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ARTICLE VI.....................................................................5
Time and Place of Closing and Deliveries....................................5
6.1 DATE OF CLOSING.................................................5
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6.2 PLACE OF CLOSING................................................5
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6.3 TIME OF CLOSING.................................................5
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6.4 DELIVERIES......................................................5
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ARTICLE VII....................................................................5
Conditions Precedent to Obligations of Buyer................................5
7.1 ICC, FCC AND OTHER APPROVAL.....................................5
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7.2 ADVERSE PROCEEDINGS.............................................5
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7.3 LICENSES........................................................5
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7.4 REPRESENTATIONS AND WARRANTIES..................................6
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7.5 RELEASE OF SECURITY INTERESTS...................................6
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7.6 TITLE INSURANCE.................................................6
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ARTICLE VIII...................................................................7
Conditions Precedent to Obligations of Seller...............................7
8.1 ICC, FCC AND OTHER APPROVAL.....................................7
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8.2 REPRESENTATIONS AND WARRANTIES..................................7
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8.3 RELEASE OF SECURITY INTERESTS...................................7
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ARTICLE IX.....................................................................7
Waiver......................................................................7
ARTICLE X......................................................................7
Additional Covenants of Seller and Buyer....................................7
10.1 ACCESS..........................................................8
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10.2 CONDUCT OF BUSINESS.............................................8
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10.3 MAINTENANCE OF ASSETS...........................................8
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10.4 DELIVERY AND RETENTION OF RECORDS...............................8
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10.5 CONSENTS........................................................8
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10.6 TRANSFER TAXES..................................................8
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10.7 NO SOLICITATION OR NEGOTIATION..................................8
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10.8 OTHER AGREEMENTS................................................8
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ARTICLE XI.....................................................................8
Representations and Warranties of Seller....................................8
11.1 ORGANIZATION AND AUTHORITY......................................8
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11.2 NO CONFLICT.....................................................9
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11.3 BINDING OBLIGATION AND CONSENTS.................................9
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11.4 TITLE TO AND NATURE OF PERSONAL PROPERTY........................9
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11.5 REAL PROPERTY...................................................9
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11.6 LITIGATION......................................................9
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11.7 LICENSES.......................................................10
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11.8 CONTRACTS......................................................10
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11.9 COMPLIANCE WITH LAWS...........................................10
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11.10 REGULATORY/ZONING COMPLIANCE...................................10
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11.11 ENVIRONMENTAL MATTERS..........................................11
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11.12 NO MATERIAL ADVERSE CHANGE.....................................12
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11.13 TAX MATTERS....................................................12
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11.14 CUSTOMER ACCOUNTS RECEIVABLE...................................12
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11.15 BROKERS........................................................12
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11.16 MATERIAL DISCLOSURE............................................12
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ARTICLE XII...................................................................12
Representations and Warranties of Buyer....................................12
12.1 ORGANIZATION AND AUTHORITY.....................................12
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12.2 NO CONFLICT....................................................12
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12.3 BINDING OBLIGATIONS AND CONSENTS...............................12
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12.4 LITIGATION.....................................................13
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ARTICLE XIII..................................................................13
Risk of Loss...............................................................13
ARTICLE XIV...................................................................13
Indemnification............................................................13
14.1 INDEMNIFICATION OF BUYER.......................................13
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14.2 INDEMNIFICATION OF SELLER......................................13
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14.3 LIMITATIONS OF LIABILITY.......................................14
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14.4 SURVIVAL OF REPRESENTATIONS AND
WARRANTIES AND COVENANTS AND OBLIGATIONS.......................14
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14.5 INDEMNIFICATION PROCEDURES.....................................14
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ARTICLE XV....................................................................15
Sale of Subscriber List Information........................................15
15.1 SALE OF SUBSCRIBER LIST INFORMATION BY BUYER...................15
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ARTICLE XVI...................................................................15
Termination................................................................15
16.1 TERMINATION BY BUYER...........................................15
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16.2 TERMINATION BY SELLER..........................................15
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16.3 FAILURE TO CLOSE BY DECEMBER 31, 2001..........................15
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16.4 EFFECT OF TERMINATION..........................................15
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ARTICLE XVII..................................................................15
Miscellaneous..............................................................15
17.1 FURTHER ASSURANCES.............................................16
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17.2 SELLER'S CONTROL OVER BUSINESS.................................16
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17.3 EXPENSES.......................................................16
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17.4 SUCCESSORS AND ASSIGNS.........................................16
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17.5 NOTICES........................................................16
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17.6 ENTIRE AGREEMENT...............................................17
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17.7 GOVERNING LAW..................................................17
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17.8 AMENDMENTS.....................................................18
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17.9 WAIVER OF COMPLIANCE WITH BULK TRANSFER LAWS...................18
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17.10 COUNTERPARTS...................................................18
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17.11 SEVERABILITY...................................................18
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17.12 HEADINGS.......................................................18
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17.13 CONSTRUCTION...................................................18
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EXHIBITS
Exhibit A.....................................................................19
Exhibit B......................................................................1
SCHEDULES
Xxxx of Sale...............................................................19
Assignment and Assumption Agreement.........................................1
Schedule 1.1(i)................................................................3
Tangible Personal Property..................................................3
MARTINSVILLE EXCHANGE..........................................................4
PLANT PROPERTY.................................................................4
MARTINSVILLE EXCHANGE..........................................................5
OUTSIDE PLANT PROPERTY.........................................................5
OBLONG EXCHANGE................................................................6
PLANT PROPERTY.................................................................6
OBLONG EXCHANGE................................................................7
OUTSIDE PLANT PROPERTY.........................................................7
Schedule 1.1(ii)...............................................................8
Licenses, Permits and Authorizations of Illinois Commerce Commission........8
Licenses, Permits and Authorizations of Federal Communications Commission...8
Licenses, Permits and Authorizations of Other Regulatory Agencies or
Municipalities..............................................................8
Schedule 1.1(iii)..............................................................9
Leases, Contracts and Agreements............................................9
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Schedule 1.1(vii).............................................................10
Leases, Licenses and Other Property Rights.................................10
Schedule 1.2..................................................................11
Real Property..............................................................11
Schedule 11.3.................................................................12
Required Consents, Approvals and Authorizations............................12
Schedule 11.7.................................................................13
Listing of All Returns, Reports, Applications, Statements and..............13
Listing of All Returns, Reports, Applications, Statements and..............13
Other Documents Required to Have Been Filed Which Have Not Been Filed......13
Schedule 11.9.................................................................14
Compliance with Laws.......................................................14
Schedule 11.10................................................................15
Regulatory/Zoning Compliance...............................................15
Schedule 11.11................................................................16
Environmental..............................................................16
Schedule 12.3.................................................................17
Required Consents, Approvals and Authorizations............................17
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ASSET PURCHASE AGREEMENT
THIS AGREEMENT, entered into as of the 14th day of June, 2001, by and
between ILLINOIS CONSOLIDATED TELEPHONE COMPANY, an Illinois corporation
("Seller"), and ODIN TELEPHONE EXCHANGE, INC., an Illinois corporation
("Buyer");
W I T N E S S E T H:
WHEREAS, Seller is an operating telephone company that provides
wireline telecommunication services in the Oblong exchange with approximately
1,559 access lines and the Martinsville exchange with approximately 1,131 access
lines in the State of Illinois (the Oblong exchange and the Martinsville
exchange are collectively referred to herein as the "Exchanges" and the business
of Seller associated with the Exchanges is hereinafter referred to as the
"Business"); and
WHEREAS, Buyer desires to acquire from Seller all of Seller's rights,
title and interest in and to the Exchanges and certain of Seller's assets used
in the operation of the Business, and Seller desires to transfer and sell to
Buyer such rights and assets, all subject to and upon the terms and conditions
hereinbelow set forth;
NOW, THEREFORE, it is hereby agreed by and between the parties hereto as
follows:
ARTICLE I
Agreement to Sell and Purchase Assets
1.1 PERSONAL PROPERTY. Upon the terms and subject to the conditions herein set
forth, Seller hereby agrees to sell, transfer, assign and deliver to Buyer, and
Buyer hereby agrees to purchase and accept delivery of, at the time and place of
Closing (as hereinafter defined), all of Seller's right, title and interest in,
to and under the following properties and assets (exclusive of the Excluded
Assets, as defined in Section 1.3 below) (the "Personal Property"), free and
clear of all liens, claims and encumbrances other than liens for taxes not yet
due and payable (the "Personal Property Permitted Exceptions"):
(i) all tangible personal property of Seller used or held
for use in the operation of the Business as of the
date hereof as listed on SCHEDULE 1.1(I) attached
hereto, except such thereof as, since the date
hereof, has been or, between the date hereof and the
Closing Date, may be depleted, returned, retired,
abandoned or otherwise disposed of in the ordinary
course of business consistent with past practices;
(ii) all licenses, certificates, permits, orders and
authorizations of the Illinois Commerce Commission
(the "ICC") issued to Seller and used in the
operation of the Business as listed on SCHEDULE
1.1(II) hereto (the "ICC Licenses") and all licenses,
permits, and authorizations of the Federal
Communications Commission (the "FCC") issued to
Seller and used in the operation of the Business as
listed on SCHEDULE 1.1(II) hereto (the "FCC
Licenses") and all other licenses, franchises,
permits, and authorizations of any other regulatory
agency (other than with respect to sales tax
licenses) or municipality issued to Seller and used
in the operation of the Business as listed on
SCHEDULE 1.1(II) hereto (the "Other Licenses") (the
FCC Licenses with the ICC Licenses and the Other
Licenses, the "Licenses");
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(iii) all of Seller's right, title and interest on and
after the Closing Date in, to and under (a) the
leases, contracts and agreements listed and described
on SCHEDULE 1.1(III) hereto; (b) all agreements
between Seller and customers of the Business; and (c)
all leases, contracts and agreements relating to the
operation of the Business on and after the Closing
Date which are entered into by Seller between the
date hereof and the Closing Date with the written
consent of Buyer, which consent shall not be
unreasonably withheld; provided, however, that none
of the foregoing items in this Section 1.1(iii) shall
include those items prorated in favor of Seller in
accordance with Article III hereof;
(iv) all of Seller's right, title, and interest in, to and
under engineering records, files, data, drawings,
blueprints, schematics, maps, reports, lists and
plans and processes intended for use in connection
with the Business;
(v) all of Seller's files of correspondence, records and
reports concerning dealings with Federal, state and
local regulatory agencies with respect to the
Business, including but not limited to all reports
filed by or on behalf of the Seller with the FCC and
the ICC;
(vi) all customer accounts receivable and customer
deposits of the Business at the time of Closing and
all records and correspondence regarding or relating
to the customer accounts, customer accounts
receivable and customer deposits; and
(vii) all of Seller's right, title and interest in and to
all leases, licenses, easements, rights of way, pole
attachment agreements, license agreements for joint
use of poles, and other property rights to such earth
stations, utility poles, real property, fixtures and
other similar items used in the operation of the
Business, as set forth on SCHEDULE 1.1(VII) hereto.
1.2 REAL PROPERTY. Upon the terms and subject to the conditions herein set
forth, Seller hereby agrees to sell, convey and deliver to Buyer, and Buyer
hereby agrees to purchase and accept delivery of, at the time and place of
Closing, by general warranty deeds, the real property described on SCHEDULE 1.2
attached hereto, including all improvements and fixtures located thereon and
easements and other rights appurtenant thereto (the "Real Property").
1.3 EXCLUDED ASSETS. It is understood and agreed that Seller shall not sell to
Buyer and that Buyer shall not purchase from Seller any assets of Seller except
those assets specifically listed or described in Sections 1.1 and 1.2 above (all
assets not listed or described in Sections 1.1 and 1.2 above hereinafter
referred to as the "Excluded Assets").
ARTICLE II
Purchase Price for Personal Property and Real Property
2.1 PURCHASE PRICE. The purchase price for the Personal Property and the Real
Property (collectively, the "Assets") shall be Seven Million Two Hundred
Thousand Dollars ($7,200,000.00) (the "Purchase Price"), subject to adjustment
in accordance with Article III hereof.
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2.2 PAYMENT OF PURCHASE PRICE. The Purchase Price shall be paid by Buyer to
Seller in cash at the time of Closing by electronic transfer of immediately
available funds to an account designated by Seller in writing prior to the
Closing Date, subject to adjustment in accordance with Article III hereof.
2.3 ALLOCATION OF PURCHASE PRICE. Buyer shall in good faith determine an
allocation of the Purchase Price among the Assets in accordance with their
respective fair market values and shall prepare a reasonable Purchase Price
allocation schedule as part of the Closing in order to reflect such allocation
of the Purchase Price. Buyer and Seller agree to act, and cause their respective
affiliates to act, in accordance with any such allocation in any relevant tax
returns or similar filings.
ARTICLE III
Prorations, Closing Expenses and Other Adjustments
PRORATIONS AND EXPENSES OF CLOSING. Property taxes, prepaid expenses of
Seller, rents, prepaid deposits, prepayments on contracts and leases, and
similar items and all other customarily prorated items, including customer
payments, shall be prorated between Seller and Buyer as of 11:59 P.M. (Central
Time) on the date immediately preceding the Closing Date. Five (5) business days
prior to the Closing, Seller shall provide Buyer with a calculation of the
prorations provided for in this Article III (the "Closing Statement"), together
with supporting documentation reasonably requested by Buyer. Real property tax
prorations shall be based on the most recently ascertainable tax information,
including confirmed multipliers; such proration is final and is not subject to
adjustment based upon a statement later issued. If the amounts set forth in the
Closing Statement under reimbursements to Seller exceed the reimbursements to
Buyer, then the difference between such amounts shall be paid to Seller by Buyer
at the Closing by an increase of the amount set forth in Section 2.1 hereof. If
the amounts set forth in the Closing Statement under reimbursements to Buyer
exceed the reimbursements to Seller, then the difference between such amounts
shall be paid to Buyer by Seller at the Closing by a reduction of the amount set
forth in Section 2.1 hereof.
ARTICLE IV
Assumption of Liabilities
4.1 ASSUMPTION. Buyer hereby agrees that at the time and place of Closing it
will assume and undertake to pay, satisfy or discharge the liabilities,
obligations and commitments of Seller which first accrue or are to be performed
or satisfied on or after the Closing Date under the leases, contracts,
agreements and other items described in Sections 1.1(iii) and 1.1(vii) above,
which have been validly assigned to Buyer (including agreements relating to
customer deposits) (all such liabilities, obligations and commitments are
referred to herein as the "Assumed Liabilities").
4.2 NON-ASSUMPTION. Seller hereby agrees and acknowledges that Buyer will assume
no liabilities, obligations and commitments of Seller other than those
specifically referred to in Section 4.1 above. No other obligation or liability
of Seller or relating to the Business or the Assets, of any nature whatsoever
(whether express or implied, fixed or contingent, liquidated or unliquidated,
known or unknown, accrued, due or to become due), is being assumed by Buyer, nor
shall Buyer be liable to pay, perform or discharge any such obligation or
liability, nor shall the Assets be subject to any such obligation or liability
(all such obligations or liabilities other than the Assumed Liabilities being
referred to in this Agreement hereafter as the "Excluded Liabilities").
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ARTICLE V
Regulatory Consents
5.1 APPLICATIONS TO THE ICC AND THE FCC. Seller and Buyer hereby agree that (a)
the transfer of the Assets by Seller to Buyer contemplated herein is subject to
the approval of the ICC (the "ICC Approval"), and (b) the assignment from Seller
to Buyer of the FCC Licenses set forth on SCHEDULE 1.1(II) hereto is subject to
the approval of the FCC (the "FCC Approval") and further agree that all
regulatory approvals including, but not limited to, requested study area waivers
must be obtained to the satisfaction of both the Buyer and the Seller. Buyer and
Seller hereby agree to file with the ICC and the FCC each application required
to obtain such approvals, and to file all such other applications with any such
other regulatory authorities or municipalities as may be necessary. Buyer and
Seller agree to prosecute said applications with all reasonable diligence and
otherwise to cooperate with each other and to use all reasonable efforts to
obtain the requisite consents promptly and to carry out the provisions of this
Agreement. Each of Buyer and Seller hereby agrees to provide promptly whatever
additional information either the ICC or the FCC or any such other regulatory
authority or municipality requests in processing said applications, and, without
limiting the generality of the foregoing, to use its best efforts to provide
such information within the time, if any, established by such agency or
municipality in its request. Buyer and Seller shall share equally all fees of
the ICC and the FCC and of any other regulatory authority or municipality
charged in connection with or incidental to the filing and processing of the
aforesaid applications. Buyer shall pay all fees of outside legal counsel,
accountants and out-of-pocket expenses in connection with filings with the ICC
or FCC. All other fees of legal counsel and accountants and other
"out-of-pocket" expenses associated with said applications shall be borne by the
party incurring them.
5.2 ICC AND FCC APPROVAL. For purposes of this Agreement, Buyer and Seller
acknowledge that (a) the term "ICC Approval" shall mean the issuance (or deemed
issuance) by the ICC of a decision or order which shall have become or been
declared final and which shall be satisfactory to the Buyer and the Seller: (i)
approving the sale of the Assets that are used in the providing of
telecommunications services in the Exchanges; (ii) approving any other
additional agreement deemed necessary between Buyer and Seller to allow Buyer to
operate the Business; (iii) granting to Buyer the ICC Licenses necessary to
operate the Business; (iv) designating Buyer as an Eligible Telecommunications
Carrier; and (v) providing that the ICC has no objection to the granting of a
study area waiver from the FCC, and (b) the term "FCC Approval" shall mean: (i)
the issuance of an order by the FCC (including its Common Carrier Bureau or
Accounting Policy Division under delegated authority) granting a study area
waiver to move the Exchanges from Seller's Illinois study area to Buyer's
Illinois study area, and subject to no conditions unsatisfactory to Buyer or
Seller, and (ii) the absence of any order or public notice by the FCC (including
its Common Carrier Bureau or Competitive Pricing division under delegated
authority) rejecting or suspending or setting for investigation any tariff
transmittal issued by Buyer to establish or modify interstate access service
rates for the Exchanges to be effective on the Closing Date.
5.3 OTHER REGULATORY APPROVALS. Buyer and Seller agree that if either of them,
using reasonable judgment, determines that an application to any other local,
state or Federal agency or municipality or entity for its approval of the sale
contemplated hereby at the Closing is required, including without limitation,
any approvals required by the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of
1976, and with respect to the Other Licenses as set forth on SCHEDULE 1.1(II)
hereto, then Seller and Buyer shall promptly file and join in such application
to the extent required by such agency, municipality or entity and shall
otherwise act in accordance with, and shall allocate the fees and expenses
associated therewith in accordance with, the provisions of Section 5.1 hereof,
and that all such approvals must be obtained to the satisfaction of both the
Buyer and the Seller.
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ARTICLE VI
Time and Place of Closing and Deliveries
6.1 DATE OF CLOSING. The date of closing (the "Closing Date") for the
consummation of this transaction unless otherwise mutually agreed by Seller and
Buyer shall be the first day of the first month (or if such day is not a
business day, the first business day of the first month) immediately succeeding
the day which is at least ten days after the date each of the ICC Approval and
the FCC Approval and any and all other regulatory and municipality approvals
that may be necessary as contemplated by Sections 5.1, 5.2 and 5.3 hereof
(collectively, the "Approvals") have been obtained and become final.
6.2 PLACE OF CLOSING. The place of closing hereunder shall be the offices of
Xxxxx Xxxxx, a professional corporation, 000 Xxxx Xxxxxx Xxxxxx, Xxxxxxxxx,
Xxxxxxxx, 00000-0000, or such other place as may mutually be agreed upon in
writing by Seller and Buyer.
6.3 TIME OF CLOSING. The time of closing hereunder shall be 10:00 A.M. (Central
Time) on the Closing Date and shall be effective as of 12:01 A.M. on the Closing
Date (the "Closing"). Unless otherwise mutually agreed by Seller and Buyer, the
specific date and time for the change of telecommunications service in the
Exchanges from Seller to Buyer shall be 12:01A.M. (Central Time) on the Closing
Date.
6.4 DELIVERIES. The sale, conveyance, assignment and transfer of the Assets and
the assumption by Buyer of the Assumed Liabilities shall be consummated at the
Closing by execution and delivery by Seller of a Xxxx of Sale substantially in
the form attached hereto as EXHIBIT A (the "Xxxx of Sale") and general warranty
deeds (the "Deeds") for each parcel of the Real Property, by proper delivery of
assignments of Seller's easements, rights of way, pole attachment agreements and
license agreements for joint use of poles, and by mutual execution and delivery
by Buyer and Seller of an Assignment and Assumption Agreement substantially in
the form attached hereto as EXHIBIT B (the "Assumption Agreement"). Buyer shall
pay the Purchase Price at the Closing in accordance with the terms of Section
2.2 hereof.
ARTICLE VII
Conditions Precedent to Obligations of Buyer
7.1 ICC, FCC AND OTHER APPROVAL. Prior to the Closing Date, each of the
Approvals, and any other required regulatory approvals (including but not
limited to municipality approval, if any required, ICC Approval and FCC
Approval) and any other approvals or consents required for the assignment by
Seller to Buyer of the contracts and agreements included in the Personal
Property, shall have become final and have been attained to the satisfaction of
Buyer and shall be in effect on the Closing Date.
7.2 ADVERSE PROCEEDINGS. As of the Closing Date, no suit, action, claim or
governmental proceeding or investigation shall have been instituted, taken,
pending or threatened against Seller which results or reasonably may result in a
material adverse effect upon, or substantial disruption of, the transaction
contemplated hereby, the Assets, or the Business.
7.3 LICENSES. On the Closing Date (a) Seller shall be the holder of the
Licenses; and (b) the Licenses will then be, and after giving effect to the
assignment thereof to Buyer will be, in full force and effect with Buyer as the
proper License holder; and (c) the Licenses shall constitute any and all of the
Licenses Buyer shall need to own and operate a business substantially similar to
the Business.
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7.4 REPRESENTATIONS AND WARRANTIES. On the Closing Date, (a) each of the
representations and warranties of Seller set forth below and all information
contained in any exhibit, schedule or attachment hereto or made a part hereof
will be true and correct in all material respects as of the date or period
specified therein or, if no date or period is specified, as of the Closing Date,
(b) Seller shall then have performed in all material respects all of the
undertakings, agreements and covenants to be performed by Seller hereunder on or
prior to the Closing Date, and (c) Seller shall have delivered to Buyer a
certificate, dated the Closing Date, executed by its President or a Vice
President, certifying the conditions specified in this Section 7.4 have been
satisfied.
7.5 RELEASE OF SECURITY INTERESTS. On or prior to the Closing Date, all liens on
the Assets shall have been released and recorded and evidence thereof shall have
been furnished to Buyer.
7.6 TITLE INSURANCE. Buyer shall have received from Seller a current commitment
in a form satisfactory to Buyer for an ALTA owner's title insurance policy, in
an amount to be determined prior to the Closing Date equal to the portion of the
Purchase Price allocated to the Real Property, at or before the date on which
the ICC has entered an order approving the sale of the assets (but which order
has not yet become final) and in connection therewith, the following shall
apply:
(i) Buyer shall identify to Seller a national title
company reasonably acceptable to Buyer which title
company shall issue the commitment described in this
Section 7.6;
(ii) title to the Real Property shall be merchantable in
Seller, free and clear of all taxes and all other
liens and encumbrances, except the lien of the
general taxes for the year of Closing, due and
payable in the following year and except for such
other liens and encumbrances as may appear, which
other liens and encumbrances shall be released of
record at or before Closing;
(iii) the commitment shall be accompanied by copies of all
instruments and documents referred to therein as
affecting title;
(iv) Buyer shall have the right, for a period of thirty
(30) days after receipt from Seller of such
commitment, together with copies of all documents
constituting exceptions to title, to review and
object to any of such exceptions that may materially
impinge on Buyer's ability to conduct the Business at
the Real Property or otherwise impair the
marketability of the Real Property. If Buyer fails to
give notice to Seller of any such objections within
such time period, Buyer shall be deemed to have
waived any such objections;
(v) if Buyer gives notice to Seller of its objection to
any such exceptions to title, Seller shall have
thirty (30) days to cure such objections. If Seller
is unable or unwilling to cure such objections and to
convey title to the Real Property in accordance with
the provisions of this Agreement it shall give notice
thereof to Buyer within said thirty (30) day period
and Buyer may at its option (a) terminate this
Agreement by notice delivered to Seller on or prior
to the date fifteen (15) days after Seller has given
notice that it is unable or unwilling to cure title
objections, or (b) waive such defect and proceed with
the Closing under this Agreement;
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(vi) Seller shall pay or credit at closing the premium on
the title insurance policy issued pursuant to the
commitment, in addition to all costs, if any,
incurred in obtaining the commitment and clearing any
exceptions; and
(vii) within thirty (30) days following Closing, Seller
shall cause to be delivered to Buyer a title
insurance policy consistent with the title commitment
and Buyer's subsequent comments thereto, in final
form reasonably acceptable to Buyer.
ARTICLE VIII
Conditions Precedent to Obligations of Seller
8.1 ICC, FCC AND OTHER APPROVAL. Prior to the Closing Date, each of the
Approvals, and any other required regulatory, Xxxx-Xxxxx-Xxxxxx and/or
municipality approvals, shall have been attained to the satisfaction of the
Seller, and shall be in effect on the Closing Date.
8.2 REPRESENTATIONS AND WARRANTIES. On the Closing Date, (a) each of the
representations and warranties of Buyer set forth below will be true and correct
in all material respects as of the date or period specified therein or, if no
date or period is specified, as of the Closing Date, (b) Buyer shall then have
performed in all material respects all of the undertakings, agreements and
covenants to be performed by Buyer hereunder on or prior to the Closing Date,
and (c) Buyer shall have delivered to Seller a certificate, dated the Closing
Date, executed by its President or a Vice President, certifying that the
conditions specified in this Section 8.2 have been satisfied.
8.3 RELEASE OF SECURITY INTERESTS. On or prior to the Closing Date, all liens on
the Assets shall have been released and recorded and evidence thereof shall have
been furnished to Buyer.
ARTICLE IX
Waiver
Seller and Buyer hereby agree that either such party may, in its
respective discretion, waive, in whole or in part, at or prior to the time of
Closing, the failure of satisfaction of, in the case of Buyer, any of the
conditions set forth in Article VII above, or, in the case of Seller, any of the
conditions set forth in Article VIII above (other than in each case the
condition set forth in Sections 7.1 and 8.1 regarding the ICC's, the FCC's and
other consents requested pursuant to Article V hereof). No such waiver by Buyer
or Seller shall be effective unless made in writing. In the event any of the
conditions set forth in Articles VII or VIII above are not satisfied at or
during the respective times therein indicated and are not waived, as above
provided, this Agreement shall terminate and be of no force or effect
whatsoever; provided, however, that in the event the only condition or
conditions not satisfied at the Closing is or are unsatisfied by reason of the
failure of Seller to perform any of its undertakings and commitments set forth
herein, or the failure of Buyer to perform any of its undertakings and
commitments set forth herein, the party not responsible for such failure or
satisfaction of such condition or conditions shall be entitled to recover
damages, to the fullest extent allowed by law, by reason of the breach by the
other party of any of such undertakings and commitments of such party.
ARTICLE X
Additional Covenants of Seller and Buyer
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10.1 ACCESS. Between the date hereof and the Closing Date, Seller will permit
Buyer and its representatives upon Buyer's reasonable request and upon
reasonable notice to Seller to inspect or examine the Assets and the books and
records relating to the Assets and operation of the Business during normal
business hours.
10.2 CONDUCT OF BUSINESS. Between the date hereof and the Closing Date, Seller
will conduct the Business in the ordinary course in substantially the same
manner as heretofore conducted.
10.3 MAINTENANCE OF ASSETS. Between the date hereof and the Closing Date, Seller
will not sell, lease or otherwise dispose of, or commit to sell, lease or
otherwise dispose of, any of the Assets. Seller shall not pledge to otherwise
encumber the Assets.
10.4 DELIVERY AND RETENTION OF RECORDS. Upon Closing, Buyer shall be entitled to
obtain from Seller and thereafter possess (a) originals, to the extent
available, of all records of the Business required to be maintained by the ICC
or the FCC or any other regulatory agency (other than taxing authorities) or
municipality relating to the Licenses, (b) copies of all records of Seller
concerning customers of the Business, and (c) all other relevant records
regarding the Business.
10.5 CONSENTS. Prior to the Closing Date, each of Seller and Buyer covenants and
agrees that it will reasonably cooperate with the other, and will do all things
reasonably necessary in obtaining all consents, if any, required for the
assignment by Seller to Buyer of the contracts and agreements included in the
Personal Property, including the furnishing of financial and other information
specifically with respect to Buyer or Seller, as the case may be, reasonably
requested by the person or entity whose consent is being sought.
10.6 TRANSFER TAXES. Buyer shall pay, and indemnify, protect and defend Seller
from and against, and Seller shall have the right to collect at Closing, all
sales, use, value added or similar taxes, duties, excises or governmental
charges imposed by any taxing jurisdiction in connection with the sale, transfer
or assignment of the Personal Property as contemplated by this Agreement, but
excluding, by way of clarification and not limitation, any taxes in the nature
of income taxes that Seller may incur as a result of the consummation of the
transactions contemplated hereby, which income taxes shall be the sole
responsibility of Seller. Seller shall pay all transfer and stamp taxes in
connection with the sale, transfer, or assignment of the Real Property or
Personal Property described in Section 1.2 or in Section 1.1 (vii).
10.7 NO SOLICITATION OR NEGOTIATION. Unless and until this Agreement is
terminated, neither the Seller nor the Buyer nor any of their affiliates and the
directors, officers, employees, representatives or agents of each of them shall
initiate or solicit, directly or indirectly, or make any inquiries or proposals
with respect to, or have any discussions or negotiations with, any other person
or entity relating to the sale of the Assets or the Business.
10.8 OTHER AGREEMENTS. As part of the consideration to the Buyer for entering
into this Agreement, Seller, for itself and its affiliates, covenants and agrees
that it will not, directly or indirectly, engage in, offer or provide local
exchange telephone services within the Exchanges for a period of five (5)
consecutive years, from and after the Closing Date.
ARTICLE XI
Representations and Warranties of Seller
Seller hereby represents and warrants to Buyer as follows:
11.1 ORGANIZATION AND AUTHORITY. Seller is a corporation duly organized, validly
existing and in good standing under the laws of the State of Illinois. Seller
has full corporate power and
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authority to execute, deliver and perform this Agreement and Seller has taken
all necessary corporate action to the authorize the execution, delivery and
performance of this Agreement.
11.2 NO CONFLICT. The execution, delivery and consummation of this Agreement by
Seller is not prohibited by, and will not conflict with, constitute grounds for
termination of, or result in a breach of, the terms, conditions or provisions
of, or constitute a default under (a) the articles of incorporation or bylaws of
Seller; (b) assuming receipt of all necessary consents in order to assign the
contracts and other items identified in Sections 1.1(iii) and 1.1(vii) hereof
and assuming receipt of the approval of the ICC and the FCC and any other
required regulatory or municipality approval as contemplated by Article V
hereof, any agreement or instrument to which Seller is now a party with respect
to the Business or to which Seller or any of the Assets is otherwise subject; or
(c) assuming receipt of the approval of the ICC and the FCC as contemplated by
Article V hereof and of any other required regulatory or municipality approval,
any law, rule or regulation applicable to Seller or the Business.
11.3 BINDING OBLIGATION AND CONSENTS. This Agreement constitutes, and upon
execution and delivery, the Xxxx of Sale, the Deeds and the Assignment and
Assumption Agreement will constitute, valid and binding agreements and
obligations of Seller enforceable against Seller in accordance with their
respective terms. With the exception of the ICC and the FCC and those regulatory
authorities and municipalities and other persons or entities listed on SCHEDULE
11.3 attached hereto (the "Required Approvals"), the execution, delivery and
performance of this Agreement by Seller and the assignment of the licenses,
contracts and agreements included in the Personal Property will not require the
consent, approval or authorization of any person, entity or governmental
authority.
11.4 TITLE TO AND NATURE OF PERSONAL PROPERTY. Seller has good and marketable
title to all of the Personal Property, free and clear of all liens and
encumbrances. The tangible Personal Property is in good working order and
repair, ordinary wear and tear excepted.
11.5 REAL PROPERTY. Seller has good and merchantable fee simple title to all of
the Real Property and all improvements thereon, free and clear of all liens and
encumbrances except liens for taxes not yet due and payable and except for such
other liens and encumbrances as may appear, which other liens and encumbrances
shall be released of record at or before Closing.
11.6 LITIGATION. There is not any pending or, to the knowledge of Seller,
threatened litigation against Seller relating to the Assets except for informal
inquiries from the ICC. There is not any pending or, to the knowledge of Seller,
threatened proceeding or investigation of any other type before any court or
governmental agency, Federal, state or local, which reasonably could result in a
material adverse effect upon or material disruption of the operations of the
Business or the Assets.
9
11.7 LICENSES. SCHEDULE 1.1(II) constitutes a true and complete list of the
licenses, permits, franchises, authorizations and approvals from the FCC and the
ICC and from any and all other regulatory or governmental authorities or
municipalities (other than taxing authorities) which are required for the lawful
conduct of the Business in the manner and to the full extent conducted by
Seller. The Licenses are the only licenses, permits, franchises, authorizations
and approvals from any regulatory or governmental authority or municipality
(other than taxing authorities) or from any other person or entity necessary for
Buyer to conduct a business substantially similar to the Business. Except as set
forth on SCHEDULE 11.7(A), all returns, reports, applications, statements and
other documents required to be filed by Seller with the FCC, the ICC and any
other regulatory or governmental authority or municipality with respect to the
Business on or before the date hereof have been duly filed or properly extended
as permitted by law, and will be as of the Closing Date, and are true and
complete in all material respects, and (b) all reporting requirements of the
FCC, the ICC and other regulatory or governmental authorities or municipalities
having jurisdiction thereof with respect to the Business have been complied with
in all material respects. A listing of all returns, reports, applications,
statements and other documents filed by Seller with respect to the Business
within the past three (3) years with the FCC, the ICC and any other regulatory
or governmental authority (other than taxing authorities) or municipality is
attached hereto as SCHEDULE 11.7; true and complete copies of all such returns,
reports, applications, statements and other documents have been previously
provided to Buyer by Seller.
11.8 CONTRACTS. Each of the leases, contracts and agreements listed on SCHEDULE
1.1(III) and/or described in Section 1.1(vii) is in full force and effect and
constitutes a valid and binding obligation of, and is legally enforceable in
accordance with its terms against, Seller. Seller is not in default under any of
the leases, contracts and agreements listed in SCHEDULE 1.1(III) and/or
described in Section 1.1(vii) and except as set forth on SCHEDULE 11.3 are all
assignable and will not require the consent, approval or authorization of any
entity or person. True and complete copies of all written leases, contracts and
agreements listed in SCHEDULE 1.1(III) have been furnished to Buyer prior to the
date hereof. True and complete copies of all items described in Section 1.1(vii)
will be furnished to Buyer within 15 business days of the date hereof.
11.9 COMPLIANCE WITH LAWS. Except as set forth on SCHEDULE 11.9, Seller in its
conduct of the Business (including but not limited to with respect to its pole
attachments) is and has been in compliance in all material respects with
applicable statutes and regulations of the United States of America, the State
of Illinois and of any state or municipality or agency of any thereof having
jurisdiction over it.
11.10 REGULATORY/ZONING COMPLIANCE. Except as set forth on SCHEDULE 11.10, the
Real Property owned or leased by the Seller for use in the Business and the
buildings, structures and improvements included within such Real Property
(collectively, the "Improvements") comply with all material applicable
restrictions, building ordinances and zoning ordinances and all material
Regulations of the applicable health and fire departments. No alteration,
repair, improvement or other work which could give rise to a lien has been
performed with respect to such Improvements within the last one hundred twenty
(120) days that has not been paid for. The Seller's owned or leased Real
Property and its continued use, occupancy and operation as currently used,
occupied and/or operated in the Business does not constitute a nonconforming use
under any Regulation or Order affecting such Real Property, and the continued
existence, use, occupancy and operation of such Improvements is not dependent on
any special permit, exception, approval or variance. There is no pending or, to
the Seller's knowledge, threatened or proposed action or proceeding by any
authority to modify the zoning classification of, to condemn or take by the
power of eminent domain (or to purchase in lieu thereof), to classify as a
landmark, to impose special assessments on or otherwise to take or restrict in
any way the right to use, develop or alter all or any part of the Seller's owned
or leased Real Property used in the Business.
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11.11 ENVIRONMENTAL MATTERS. Except as set forth on SCHEDULE 11.11:
(i) no notice, notification, demand, request for
information, citation, summons or Order has been
issued, no complaint has been filed, no penalty has
been assessed and no investigation or review is
pending or, to the Seller's knowledge, threatened by
any authority or other entity with respect to the
Real Property relating to any environmental permit,
license or authorization required in connection with
the conduct of the Business or with respect to the
generation, treatment, storage, recycling,
transportation, disposal or release of any substance
regulated under any and all applicable environmental
laws or regulation ("Hazardous Materials");
(ii) the Seller has not handled any Hazardous Material at
the Real Property;
(iii) no PCB or asbestos is or has been present at the Real
Property;
(iv) there are no underground storage tanks for Hazardous
Materials, active or abandoned, at the Real Property
and no tanks have ever been removed;
(v) there has been no release as defined in Section
9601(22) of Title 42 of the United States Code of
Hazardous Materials at or under the Real Property;
(vi) no oral or written notification of a Release of
Hazardous Materials has been filed by or on behalf of
the Seller with respect to the Real Property and the
Real Property is not listed or proposed for listing
on the National Priorities List under the
Comprehensive Environmental Response Compensation and
Liability Act of 1980, as amended ("CERCLA") or the
Comprehensive Environmental Response and Liability
Improvements System ("CERCLIS") or any similar state
list of sites requiring investigation or clean-up;
(vii) there are no liens arising under or pursuant to any
applicable environmental laws or regulation on any of
the Real Property and no governmental actions have
been taken or are threatened which could subject any
of such properties to such liens. Seller is not
required to place any notice or restriction relating
to the presence of Hazardous Materials on the Real
Property; and
(viii) there have been no Phase I or Phase II environmental
site assessments conducted by or which are in the
possession of the Seller in relation to the Real
Property;
(ix) true and complete copies of all documents listed on
SCHEDULE 11.11 have been furnished to the Buyer prior
to the date hereof and the contents of such documents
shall be deemed to be incorporated herein for
disclosure purposes only.
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11.12 NO MATERIAL ADVERSE CHANGE. Since December 31, 1999, there has been no
material adverse change in the Business or in the Assets, properties, conditions
or prospects of the Business, nor to the knowledge of Seller, is any such change
threatened, nor has there been any damage, destruction or loss which could
reasonably be expected to have a material adverse effect on the Business,
whether or not covered by insurance.
11.13 TAX MATTERS. There are no tax liens upon any of the Assets except liens
for taxes not yet due. The Seller warrants that all taxes due and owing on or
with respect to the Personal Property and on the Real Property have been paid in
full and further warrants that Buyer shall have no liability for any taxes of
the Seller in respect of or attributable to the Assets for any period or portion
thereof ending on or prior to the Closing Date. All Personal Property has been
listed with the appropriate municipality and/or state authority, if required.
11.14 CUSTOMER ACCOUNTS RECEIVABLE. The Seller's customer accounts receivable
(a) have arisen from a bona fide sales transaction in the ordinary course of
business of the Seller on ordinary terms, (b) represent valid and binding
obligations due to the Seller, enforceable in accordance with their terms, and
(c) are collectible in the ordinary course of business of the Seller, in the
aggregate recorded amounts thereof in accordance with their terms without valid
set-off or counterclaim.
11.15 BROKERS. Seller has not engaged any agent, broker or other person acting
pursuant to the express or implied authority of Seller which is entitled to a
commission or broker or finder's fee as a result of the sale of the Assets
contemplated by this Agreement.
11.16 MATERIAL DISCLOSURE. No representation or warranty by Seller hereunder
contains any untrue statement of a material fact or omits to state a material
fact necessary to make the statements contained therein not misleading.
ARTICLE XII
Representations and Warranties of Buyer
Buyer hereby represents and warrants to Seller as follows:
12.1 ORGANIZATION AND AUTHORITY. Buyer is a corporation duly organized, validly
existing and in good standing under the laws of the State of Illinois. Buyer has
full corporate power and authority to execute, deliver and perform this
Agreement and Buyer has taken all necessary corporate action to authorize the
execution, delivery and performance of this Agreement.
12.2 NO CONFLICT. The execution, delivery and consummation of this Agreement by
Buyer is not prohibited by, and will not conflict with, constitute grounds for
termination of, or result in a breach of, the terms, conditions or provisions
of, or constitute a default under (a) the articles of incorporation or by-laws
of Buyer; (b) any agreement or instrument to which Buyer is now a party or to
which Buyer is otherwise subject; or (c) assuming receipt of all Approvals, any
law, rule or regulation applicable to Buyer.
12.3 BINDING OBLIGATIONS AND CONSENTS. This Agreement constitutes, and upon
execution and delivery, the Assignment and Assumption Agreement will constitute
valid and binding agreements and obligations of Buyer enforceable against Buyer
in accordance with their terms. With the exception of the ICC and the FCC and
those regulatory authorities and municipalities and other persons or entities
listed on SCHEDULE 12.3 attached hereto, the execution, delivery and performance
of this Agreement by Buyer and the assignment of the contracts, licenses and
agreements included in the Personal Property, will not require the consent,
approval or authorization of any person, entity or governmental authority.
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12.4 LITIGATION. There is not any pending or, to the knowledge of Buyer,
threatened litigation, proceeding or investigation before any court or
governmental agency, Federal, state or local, which reasonably could result in a
material adverse effect upon Buyer's ability to consummate the transactions
contemplated by this Agreement.
ARTICLE XIII
Risk of Loss
Seller and Buyer hereby agree that the risk of any loss or damage to
any of the Assets (ordinary wear and tear excepted) shall be on Seller at all
times on or prior to the Closing Date. In the event of any such loss or damage
to any of the Assets, Seller shall use all reasonable efforts to repair, replace
or restore the same to at least their condition immediately preceding such loss
or damage as soon as possible. If any lost or damaged Assets shall not have been
repaired, replaced or restored by the Closing Date (ordinary wear and tear
excepted), Buyer may, by written notice to Seller, elect to (a) postpone the
Closing for a period of not more than thirty (30) days to permit Seller an
opportunity to repair, replace or restore the lost or damaged Assets; (b)
terminate this Agreement, if and only if such loss or damage cannot be repaired,
restored or replaced within such thirty (30) day period, in which event this
Agreement shall be null and void; or (c) proceed with the Closing in which
latter event Buyer shall take such Assets in their condition on the Closing Date
and Seller shall pay or assign to Buyer all insurance proceeds paid or payable
to Seller as a result of such loss or damage to the extent such proceeds exceed
the aggregate amount previously expended by Seller in repair, replacement or
restoration of lost or damaged Assets. If such postponement would extend the
Closing Date beyond the period within which the Approvals are effective, Seller
and Buyer shall cooperate in filing all such petitions or other documents with
the ICC and the FCC and such other regulatory authorities and municipalities as
may be necessary to extend such period.
ARTICLE XIV
Indemnification
14.1 INDEMNIFICATION OF BUYER. During the Indemnification Period (as hereinafter
defined) (or thereafter solely with respect to a claim for indemnification for
which notice has been given prior to the expiration of the Indemnification
Period), Seller hereby agrees to indemnify and hold Buyer, its affiliates,
officers, directors and representatives harmless from and against any and all
losses, damages and expenses (including, but not limited to, reasonable
attorneys' fees) resulting from or arising out of (a) the ownership, management
or use of the Assets and/or the operation of the Business before the Closing
Date, except to the extent Buyer has specifically assumed such obligations under
the terms of this Agreement; (b) the breach of any of the representations and
warranties of Seller set forth in this Agreement; (c) the breach of any of the
covenants or obligations of Seller set forth in this Agreement; and (d) the
Excluded Liabilities.
14.2 INDEMNIFICATION OF SELLER. During the Indemnification Period (or thereafter
solely with respect to a claim for indemnification for which notice has been
given prior to the expiration of the Indemnification Period), Buyer hereby
agrees to indemnify and hold Seller harmless from and against any and all
losses, damages and expenses (including, but not limited to, reasonable
attorneys' fees) resulting from or arising out of (a) the ownership, management
or use of the Assets and/or the operation of the Business after the Closing
Date; (b) the breach of any of the representations and warranties of Buyer set
forth in this Agreement; (c) the breach of any of the covenants or obligations
of Buyer set forth in this Agreement; and (d) the Assumed Liabilities.
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14.3 LIMITATIONS OF LIABILITY.
(a) No liability for indemnification shall arise on the part of the
Seller or the Buyer under this Article XIV (excluding claims arising out of
Excluded Liabilities) unless and until the aggregate amount of such claims
exceed Fifty Thousand Dollars ($50,000.00) (the "Basket Amount"); provided,
however, that in the event the claims exceed the Basket Amount, the indemnifying
party shall indemnify the indemnified party only for those losses in excess of
Fifty Thousand Dollars ($50,000.00).
(b) Notwithstanding anything herein to the contrary, the maximum
aggregate liability of Seller under this Article XIV shall be limited to the
amount of the Purchase Price.
14.4 SURVIVAL OF REPRESENTATIONS AND WARRANTIES AND COVENANTS AND OBLIGATIONS.
The representations and warranties, covenants and indemnification and other
obligations of Seller and Buyer set forth in this Agreement shall expire on the
eighteen (18) month anniversary of the Closing Date except as otherwise
specifically stated herein. Such eighteen (18) month time period is referred to
herein as the "Indemnification Period". At the end of the Indemnification
Period, each such representation and warranty and covenant and obligations shall
expire together with any right to indemnification relating thereto, except to
the extent a written notice asserting a claim for breach of any such
representation or warranty or covenant or obligation or otherwise asserting a
claim for indemnification hereunder shall have been given prior to the
termination of such Indemnification Period to the party which made such
representation or warranty, covenant or indemnification or other obligation;
provided, however, that notwithstanding any provision of this Section 14.4 to
the contrary, Buyer's obligation to indemnify Seller and Seller's obligation to
indemnify Buyer with respect to any third party or tax claim shall be fully
enforceable through and until the expiration of the statute of limitations
applicable to any such claim, as such statute of limitations may have been
extended by agreement from time to time.
14.5 INDEMNIFICATION PROCEDURES.
(a) Each of Buyer and Seller agrees to give written notice within
thirty (30) days to the other of any claim against the party giving notice which
might give rise to a claim by it against another party hereto based upon the
indemnity provisions contained herein. The failure to give notice within thirty
(30) days as required by this Section 14.5 shall not serve to eliminate or limit
the obligation to indemnify unless such failure prejudices the rights of the
indemnifying party and then only to the extent of any damages caused by the
failure to notify. In the event that any action, suit or proceeding is brought
against any party entitled to be indemnified pursuant to Section 14.1 or 14.2
hereof with respect to which any party hereto may have liability under the
indemnity provisions contained herein, the indemnifying party, subject to the
satisfaction of the indemnified party, shall have the right, at its sole cost
and expense, to defend such action in the name and on behalf of the indemnified
party and, in connection with any such action, suit or proceeding, the parties
hereto agree to render to each other such assistance as may reasonably be
required in order to insure the proper and satisfactory defense of any such
action, suit or proceeding. If the indemnifying party shall fail to defend such
action, the indemnified party shall have the right to employ its own counsel,
but the fees and expenses of the indemnified party shall be at the expense of
the indemnifying party. No party hereto shall make settlement of any claim which
might give rise to liability of another party hereto under the indemnity
provisions contained herein without the written consent of such other party,
which consent such other party covenants shall not be unreasonably withheld,
unless the indemnifying party has failed to defend such action and then the
indemnified party shall be entitled at its sole discretion to settle the action
at the expense of the indemnifying party. Any claim for which indemnification
occurs hereunder shall be, to the extent appropriate, assigned (without
recourse) to the indemnifying party.
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(b) Prior to Buyer or Seller asserting any claim under this Article
XIV, such claimant shall file, or cause to be filed, a claim with respect to
such indemnified claim in question under any applicable insurance policies that
may be maintained by such claimant or any affiliate thereof. The allowance or
disallowance of such insurance claim shall not be a condition precedent to the
indemnifying party's obligation under this Article XIV. In the event that any
insurance policies maintained by the claimant would cover such indemnified
claim, then, subject to the other terms of this Article XIV, the indemnifying
party's indemnification for such indemnified claim shall be limited to any
deductible and amounts in excess of the amounts actually collected by the
claimant for such indemnified claim.
ARTICLE XV
Sale of Subscriber List Information
15.1 SALE OF SUBSCRIBER LIST INFORMATION BY BUYER. Buyer shall provide McLeodUSA
Publishing Company ("Publisher") with Buyer's complete subscriber list
information ("SLI") for the Exchanges which is gathered by Buyer in its capacity
as provider of telephone exchange service for the Exchanges, with the SLI being
timely through the date identified in writing by Publisher. Buyer shall provide
the SLI for the Exchanges to the Publisher on the same terms and conditions that
Buyer is then providing to Publisher the SLI for other exchanges for which Buyer
provides telephone exchange services.
ARTICLE XVI
Termination
16.1 TERMINATION BY BUYER. Subject to the terms of Article IX hereof, Buyer may
by written notice to Seller terminate this Agreement in the event any of the
conditions to the obligations of Buyer set forth in Article VII above are not
satisfied by the applicable time period set forth herein. If this Agreement is
terminated by Buyer, all items of value delivered by one party to the other
shall be redelivered to the delivering party.
16.2 TERMINATION BY SELLER. Subject to the terms of Article IX hereof, Seller
may by written notice to Buyer terminate this Agreement in the event any of the
conditions to the obligations of Seller set forth in Article VIII above are not
satisfied by the applicable time period set forth herein.
16.3 FAILURE TO CLOSE BY DECEMBER 31, 2001. Buyer or Seller may, by written
notice to the other, terminate this Agreement in the event the Closing has not
occurred by December 31, 2001, unless such failure to close shall be due to a
breach of this Agreement by the party seeking to terminate the Agreement or such
failure to close shall be due to the non-receipt of satisfactory ICC Approval or
FCC Approval, which approval has been diligently sought, and in which case this
date shall automatically be extended for ninety (90) days.
16.4 EFFECT OF TERMINATION. In the event of the termination of this Agreement,
pursuant to the provisions hereof, none of the parties hereto (nor any of their
partners, stockholders, directors, officers, employees, agents or affiliates)
shall have any liability or further obligation hereunder to the other party,
except that nothing herein shall relieve any party from any liability for any
breach of this Agreement.
ARTICLE XVII
Miscellaneous
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17.1 FURTHER ASSURANCES. After the Closing Date, each party, at the request of
the other and without additional consideration, shall execute and deliver or
cause to be executed and delivered from time to time such further instruments of
conveyance and transfer and shall take such other action as the other may
reasonably require to convey and deliver good title to the Assets to Buyer, to
perfect Buyer's title thereto and to accomplish the orderly transfer of the
Assets and the Business to Buyer in the manner contemplated by this Agreement
and to consummate the transactions contemplated hereby.
17.2 SELLER'S CONTROL OVER BUSINESS. No provision of this Agreement shall be
construed to abrogate Seller's control of and responsibility for the operation
of the Business prior to the actual transfer of title of the Assets hereunder to
Buyer at the Closing as approved by the ICC, the FCC and other required
regulatory or municipality approval.
17.3 EXPENSES. Except as otherwise specifically set forth in this Agreement,
Seller and Buyer shall each bear their own expenses incurred in connection with
the execution and performance of this Agreement.
17.4 SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon and inure to
the benefit of the parties hereto and their respective successors and assigns;
provided, however, that neither party may assign this Agreement without the
prior written consent of the other party, except that either party may assign
its rights hereunder to an affiliate of the party without the need for further
consent of any kind.
17.5 NOTICES. Any notice or other communication required or permitted to be
given by any party hereto to any other party hereto shall be in writing and
delivered in person or mailed by prepaid registered or certified mail or sent by
facsimile with the transmission confirmed by telephone,
If to Seller, to: Illinois Consolidated Telephone Company
000 Xxxxx 00xx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attn: Xxxxxx X. Xxxxxx
Fax: (000) 000-0000
Telephone: (000) 000-0000
And
Illinois Consolidated Telephone Company
000 Xxxxx 00xx Xxxxxx
Xxxxxxx, Xxxxxxxx, 00000
Attn: Xxxxxx X. Xxxxx
Fax: (000) 000-0000
Telephone: (000) 000-0000
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with a copy to: McLeodUSA Incorporated
0000 X Xxxxxx XX
Xxxx Xxxxxx Xxx 0000
Xxxxx Xxxxxx, Xxxx 00000
Attn: General Counsel
Fax: (000) 000-0000
Telephone: (000) 000-0000
If to Buyer, to: Odin Telephone Exchange, Inc.
c/o FairPoint Communications, Inc.
000 Xxxx Xxxxxxxx Xxxxxx
Xxxxx 000
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attn: Xxxxxx X. Xxxxxxx, Vice Chairman and
Executive Vice President
Fax: (000) 000-0000
Telephone: (000) 000-0000
And
FairPoint Communications, Inc.
000 Xxxx Xxxxxxxx Xxxxxx
Xxxxx 000
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attn: Xxxxxxx X. Xxxx, Vice President and
General Counsel
Fax: (000) 000-0000
Telephone: (000) 000-0000
with a copy to: Xxxxx X. Xxxxxx, Esq.
Rosenman & Colin LLP
000 Xxxxx Xxxxx Xxxxxx
Xxxxx 0000
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Fax: (000) 000-0000
Telephone: (000) 000-0000
or to such other address for such party as may be designated by it by notice
pursuant hereto. A notice shall be deemed delivered when delivered personally
or, if given by mail as aforesaid, on the third day after the date the same is
postmarked or, if sent by facsimile on the date receipt of such facsimile is
confirmed, unless such day of confirmation is not a business day, in which case
receipt shall be the first business day thereafter.
17.6 ENTIRE AGREEMENT. This Agreement constitutes the entire agreement between
the parties hereto with respect to the subject matter hereof and, except as
herein set forth, there are no warranties, express or implied, by any party
hereto to the other.
17.7 GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Illinois.
17
17.8 AMENDMENTS. This Agreement may not be amended or modified in any respect
except by a writing executed by the parties hereto. Any failure by either party
to comply with any of its obligations, agreements, covenants or indemnities
contained in this Agreement may be waived in writing, but not in any other
manner, by the party against which enforcement of the waiver is sought.
17.9 WAIVER OF COMPLIANCE WITH BULK TRANSFER LAWS. Buyer hereby waives
compliance by Seller with the provisions of the bulk transfer laws of any
jurisdiction in connection with the transactions contemplated by this Agreement.
Notwithstanding anything to the contrary in this Agreement, Seller agrees to
indemnify and hold Buyer harmless from and against all damages, liabilities,
losses, and expenses (including attorneys' fees and expenses) resulting from or
arising out of Seller's failure to comply with, or to provide notice with
respect to, the bulk transfer laws of any jurisdiction in connection with the
transactions contemplated by this Agreement.
17.10 COUNTERPARTS. This Agreement may be executed in any number of counterparts
(including by facsimile signature), each of which shall be an original, but all
of which together shall constitute one instrument.
17.11 SEVERABILITY. In the event any one or more of the provisions contained in
this Agreement or in any other instrument referred to herein, shall, for any
reason, be held to be invalid, illegal or unenforceable, such illegality,
invalidity or unenforceability shall not affect any other provisions of this
Agreement.
17.12 HEADINGS. The descriptive headings of the several Articles and Sections of
this Agreement are inserted for convenience only and shall not control or affect
the meaning or construction of any of the provisions hereof.
17.13 CONSTRUCTION. Wherever the word "including" is used herein such word shall
be deemed to mean "including, but not limited to" in each such case.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
the day and year first above written.
ILLINOIS CONSOLIDATED TELEPHONE COMPANY
/s/ J. XXXX XXXXXXX
--------------------------------------------
By: J. Xxxx Xxxxxxx
Title: Vice President & CFO
ODIN TELEPHONE EXCHANGE, INC.
/s/ XXXXXX X. XXXXX, XX.
--------------------------------------------
By: Xxxxxx X. Xxxxx, Xx.
Title: Senior Vice President
18
Exhibit A
Xxxx of Sale
Pursuant to the Asset Purchase Agreement dated June 14, 2001 (the
"Agreement") among ODIN TELEPHONE EXCHANGE, INC., an Illinois corporation
("Buyer") and ILLINOIS CONSOLIDATED TELEPHONE COMPANY, an Illinois corporation
("Seller"), for good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, Seller does hereby sell, assign, transfer, convey
and deliver unto Buyer and its successors and assigns all of Seller's right,
title and interest in, to and under the Personal Property (as such term is
defined in the Agreement).
Seller will provide to Buyer such further assurances and execute such
further instruments as may be reasonably requested by Buyer from time to time
and as may be reasonably necessary to assure, complete and evidence the full and
effective conveyance of the property hereby sold and conveyed free and clear of
all liens, claims and encumbrances.
Seller warrants to Buyer that Seller has good, unencumbered title to
the Personal Property and further warrants that Seller has full right, title,
interest and authority to sell, transfer, assign, convey and deliver the
Personal Property to Buyer.
This Xxxx of Sale shall be binding upon the successors and assigns of
Seller and shall inure to the benefit of the successors and assigns of Buyer.
IN WITNESS WHEREOF, Seller has caused this Xxxx of Sale to be duly
executed and delivered as of the _____ day of _________________, 2001.
ILLINOIS CONSOLIDATED TELEPHONE COMPANY
---------------------------------------------
By: _________________________________
Title: _________________________________
19
Exhibit B
Assignment and Assumption Agreement
This Assignment and Assumption Agreement dated as of the ______ day of
_____________, 2001, is by and between ILLINOIS CONSOLIDATED TELEPHONE COMPANY,
an Illinois corporation ("Seller"), and ODIN TELEPHONE EXCHANGE, INC., an
Illinois corporation ("Buyer").
WHEREAS, Buyer and Seller have entered into that certain Asset Purchase
Agreement, dated June 14, 2001 (the "Agreement");
WHEREAS, pursuant to the Agreement, Seller is selling to Buyer certain
assets of Seller; and
WHEREAS, pursuant to the Agreement, Seller is to assign to Buyer all of
its right, title and interest on the date hereof in, to and under certain
contracts and other agreements described below and Buyer is to assume the
liabilities, obligations and commitments hereinafter described from and after
the date hereof;
NOW THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree as
follows:
1. For value received as provided in the Agreement, Seller does hereby
sell, assign, transfer and convey to Buyer all of Seller's right, title
and interest in, to and under (i) the contracts and agreements
described in Section 1.1(iii) and listed on Schedule 1.1(iii) of the
Agreement and those easements, licenses, rights of way, agreements and
other items described in Section 1.1(vii) and listed on Schedule 1.1
(vii) of the Agreement (collectively, the "Contracts").
2. Buyer hereby agrees to assume and undertake to pay, satisfy and
discharge the liabilities, obligations and commitments of Seller which
first accrue or are to be performed or satisfied on or after the date
hereof under the Contracts. Other than specifically stated herein,
Buyer assumes no obligations of Seller.
This Assignment and Assumption Agreement shall be binding upon the
successors and assigns of Buyer and Seller and shall inure to the benefit of the
successors and assigns of Buyer and Seller.
REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
IN WITNESS WHEREOF, the parties hereto have caused this Assignment and
Assumption Agreement to be duly executed and delivered as of the date set forth
above.
SELLER:
ILLINOIS CONSOLIDATED TELEPHONE COMPANY
---------------------------------------------
By: _________________________________
Its: _________________________________
BUYER:
ODIN TELEPHONE EXCHANGE, INC.
---------------------------------------------
By: _________________________________
Its: _________________________________
2
SCHEDULE 1.1(I)
Tangible Personal Property
SEE ATTACHED
MARTINSVILLE EXCHANGE
PLANT PROPERTY
MARTINSVILLE EXCHANGE
OUTSIDE PLANT PROPERTY
OBLONG EXCHANGE
PLANT PROPERTY
OBLONG EXCHANGE
OUTSIDE PLANT PROPERTY
SCHEDULE 1.1(II)
Licenses, Permits and Authorizations of Illinois Commerce Commission
Seller has authority to provide services in the Exchanges from the
Illinois Commerce Commission pursuant to Section 13-401 of the Illinois Public
Utilities Act.
Licenses, Permits and Authorizations of Federal Communications
Commission
NONE
Licenses, Permits and Authorizations of Other Regulatory Agencies or
Municipalities
Oblong: Franchise Agreement of ICTC with the Village of Oblong, dated May 4,
1966, as subsequently revised, copy of which has been provided to Buyer.
Martinsville: Franchise Agreement of ICTC with the City of Martinsville, dated
May 17, 1966, copy of which has been provided to Buyer.
SCHEDULE 1.1(III)
Leases, Contracts and Agreements
NONE
SCHEDULE 1.1(VII)
Leases, Licenses and Other Property Rights
Buyer and Seller will cooperate to produce an exhibit to this Schedule
which contains a listing of all easements used in the operation of the Business
within fifteen (15) business days after this Agreement is signed.
All of that portion of Seller's interest in a Pole Attachment Agreement
entered into with Central Illinois Public Service Company dated August 1, 1938
that pertains to poles used in the operation of the Business.
SCHEDULE 1.2
Real Property
1. Lot 29 in Xxxxx First Addition to the Town (now City) of Martinsville,
Xxxxx County, Illinois, locally known as 000 X. Xxxx Xxxxxx,
Xxxxxxxxxxxx, Xxxxxxxx, tax index numbers 12 09 065 012 00.
2. Lot 23 in X.X. Xxxxx'x First Addition to the Village of Oblong,
Xxxxxxxx County, Illinois, locally known as 000 X. Xxxxxxxx Xxxxxx,
Xxxxxx, Xxxxxxxx, tax index number 044 31 012 024 000.
SCHEDULE 11.3
Required Consents, Approvals and Authorizations
ICC approval is needed.
FCC approval is needed.
Village of Oblong consent may be needed.
City of Martinsville consent may be needed.
SCHEDULE 11.7
Listing of All Returns, Reports, Applications, Statements and
Other Documents Filed by Seller Within the Past Three (3) Years
ICC Annual Reports:
(a) Form 23A Annual Report
(b) Annual Report Data Request
FCC Number Utilization Report Form 502
Listing of All Returns, Reports, Applications, Statements and
Other Documents Required to Have Been Filed Which Have Not Been Filed
NONE
SCHEDULE 11.9
Compliance with Laws
NONE
SCHEDULE 11.10
Regulatory/Zoning Compliance
NONE
SCHEDULE 11.11
Environmental
Seller has provided to Buyer a complete copy of:
1) Phase I Environmental Site Assessment for 000 X. Xxxx Xxxxxx,
Xxxxxxxxxxxx, Xxxxxxxx, dated July 28, 1997.
2) Phase I Environmental Site Assessment for 000 X. Xxxxxxxx Xxxxxx,
Xxxxxx, Xxxxxxxx, dated July 28, 1997, and information regarding replacement of
roof on building at this location during fall 2000.
SCHEDULE 12.3
Required Consents, Approvals and Authorizations
ICC approval is needed.
FCC approval is needed.
Village of Oblong consent may be needed.
City of Martinsville consent may be needed.
