PURCHASE AGREEMENT
AMONG
ICG D.C. HOLDINGS, INC.
AND THE
MEMBERS
OF
DATACHOICE NETWORK SERVICES, L.L.C.
TABLE OF CONTENTS
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PAGE
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ARTICLE I
DEFINITIONS 1
ARTICLE II
PURCHASE AND SALE . . . . . . . . . . 6
SECTION 2.1 Basic Transaction . . . . . . . . . . . . 6
SECTION 2.2 Purchase Price; Payment . . . . . . . . 7
SECTION 2.3 [Intentionally Omitted] . . . . . . . . . 7
SECTION 2.4 Payment of Certain Amounts . . . . . . . 7
SECTION 2.5 [Intentionally omitted.] . . . . . . . . 7
SECTION 2.6 Closing; Closing Date . . . . . . . . . . 7
SECTION 2.7 Deliveries at the Closing . . . . . . . . 7
SECTION 2.8 Waiver of Rights of First Refusal . . . . 7
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF SELLERS . . . . 8
SECTION 3.1 Organization, Good Standing, Etc. . . . . 8
SECTION 3.2 Subsidiaries . . . . . . . . . . . . . . 8
SECTION 3.3 Ownership and Capitalization . . . . . . 8
SECTION 3.4 Authority; No Violation . . . . . . . . . 8
SECTION 3.5 Consents and Approvals . . . . . . . . . 9
SECTION 3.6 Financial Statements . . . . . . . . . . 9
SECTION 3.7 Absence of Certain Changes or Events . . 10
SECTION 3.8 Tax Matters . . . . . . . . . . . . . . . 10
SECTION 3.9 Assets and Properties . . . . . . . . . . 11
SECTION 3.10 Lists of Properties, Contracts and Other
Data . . . . . . . . . . . . . . . . . . 12
SECTION 3.11 Litigation; Compliance with Applicable
Laws, Rights and Permits . . . . . . . . 12
SECTION 3.12 Accounts Receivable . . . . . . . . . . . 13
SECTION 3.13 Product Quality, Warranty and Liability . 13
SECTION 3.14 Insurance . . . . . . . . . . . . . . . . 13
SECTION 3.15 Pension and Employee Benefit Matters . . 14
SECTION 3.16 Employees and Labor . . . . . . . . . . . 15
SECTION 3.17 Customer and Supplier Relationships . . . 15
SECTION 3.18 Environmental Matters . . . . . . . . . . 15
SECTION 3.19 Intellectual Property . . . . . . . . . . 16
SECTION 3.20 Brokers' Fees and Commissions . . . . . . 16
SECTION 3.21 Acquisition for Investment . . . . . . . 16
SECTION 3.22 Disclosure . . . . . . . . . . . . . . . 17
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ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF BUYER . . . . 18
SECTION 4.1 Organization and Qualification, etc. . . 18
SECTION 4.2 Authority Relative to Agreement . . . . . 18
SECTION 4.3 Non-Contravention . . . . . . . . . . . . 18
SECTION 4.4 Government Approvals . . . . . . . . . . 19
SECTION 4.5 Brokers . . . . . . . . . . . . . . . . . 19
SECTION 4.6 Purchase for Investment . . . . . . . . . 19
SECTION 4.7 SEC Reports and Nasdaq Compliance . . . . 19
ARTICLE V
PRE-CLOSING COVENANTS . . . . . . . . . 19
SECTION 5.1 General . . . . . . . . . . . . . . . . . 19
SECTION 5.2 Operation and Preservation of Business . 20
SECTION 5.3 Full Access . . . . . . . . . . . . . . . 20
SECTION 5.4 Notice of Developments . . . . . . . . . 20
SECTION 5.5 Exclusivity . . . . . . . . . . . . . . . 20
SECTION 5.6 Announcements . . . . . . . . . . . . . . 21
SECTION 5.7 Payment By Sellers of Employee Claims and
Other Expenses . . . . . . . . . . . . . 21
SECTION 5.8 Closing Date Liabilities and Distribution 21
SECTION 5.9 Confidentiality . . . . . . . . . . . . . 21
SECTION 5.10 Consents and Approvals. . . . . . . . . 21
ARTICLE VI
POST-CLOSING COVENANTS . . . . . . . . 22
SECTION 6.1 Further Assurances . . . . . . . . . . . 22
SECTION 6.2 Transition . . . . . . . . . . . . . . . 22
SECTION 6.3 Cooperation . . . . . . . . . . . . . . . 22
SECTION 6.4 Confidentiality . . . . . . . . . . . . . 22
SECTION 6.5 Post-Closing Announcements . . . . . . . 22
SECTION 6.6 Financial Statements . . . . . . . . . . 22
SECTION 6.7 Satisfaction of Liabilities . . . . . . . 23
SECTION 6.8 Sales of ICG Shares . . . . . . . . . . . 23
SECTION 6.9 Restriction of Sellers' Activities . . . 23
ARTICLE VII
CONDITIONS TO CLOSING . . . . . . . . . 23
SECTION 7.1 Conditions to Obligation of Buyer . . . . 23
SECTION 7.2 Conditions to Obligation of Sellers . . . 25
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ARTICLE VIII
REMEDIES FOR BREACHES OF THIS AGREEMENT . . . . 26
SECTION 8.1 Indemnification Provisions for Benefit of
Buyer and the Company . . . . . . . . . . 26
SECTION 8.2 Indemnification Provisions for Benefit of
Sellers . . . . . . . . . . . . . . . . . 27
SECTION 8.3 Matters Involving Third Parties . . . . . 28
SECTION 8.4 Survival . . . . . . . . . . . . . . . . 29
SECTION 8.5 Limitations . . . . . . . . . . . . . . . 29
SECTION 8.6 Basket and Ceiling . . . . . . . . . . . 29
ARTICLE IX
TERMINATION . . . . . . . . . . . 30
SECTION 9.1 Termination of Agreement . . . . . . . . 30
SECTION 9.2 Effect of Termination . . . . . . . . . . 31
SECTION 9.3 Confidentiality . . . . . . . . . . . . . 31
ARTICLE X
MISCELLANEOUS . . . . . . . . . . . 31
SECTION 10.1 No Third-Party Beneficiaries . . . . . . 31
SECTION 10.2 Entire Agreement . . . . . . . . . . . . 31
SECTION 10.3 Succession and Assignment . . . . . . . . 31
SECTION 10.4 Counterparts . . . . . . . . . . . . . . 31
SECTION 10.5 Headings, Terms . . . . . . . . . . . . . 32
SECTION 10.6 Notices . . . . . . . . . . . . . . . . . 32
SECTION 10.7 Governing Law . . . . . . . . . . . . . . 33
SECTION 10.8 Amendments and Waivers . . . . . . . . . 33
SECTION 10.9 Severability . . . . . . . . . . . . . . 33
SECTION 10.10 Expenses . . . . . . . . . . . . . . . . 33
SECTION 10.11 Arbitration . . . . . . . . . . . . . . . 33
SECTION 10.12 Construction . . . . . . . . . . . . . . 34
SECTION 10.13 Incorporation of Exhibits . . . . . . . . 34
SECTION 10.14 Representations as to Knowledge . . . . . 34
SECTION 10.15 Sellers' Agent . . . . . . . . . . . . . 35
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EXHIBITS
Exhibit A Form of Employment Agreement
Exhibit B Escrow Agreement
Exhibit C Form of Noncompetition Agreement
Exhibit D Form of Registration Rights Agreement
Exhibit E Form of Assignment of Interests
SCHEDULES
Schedule 1.1(i) Latest Balance Sheet
Schedule 3.1(a)(i) Qualifications and Authorizations of the
Company
Schedule 3.1(a)(ii) Articles of Organization of the Company
Schedule 3.1(a)(iii)Operating Agreement of the Company
Schedule 3.3 Membership Interests in the Company
Schedule 3.5 Sellers Notices and Consents
Schedule 3.6(a) Audited Financial Statements
Schedule 3.6(b) Unaudited Financial Statements
Schedule 3.7 Changes or Events
Schedule 3.8(c) Tax Returns
Schedule 3.8(e) Asset Bases
Schedule 3.9(a) Ownership of Assets and Equipment Leases
Schedule 3.9(b) Premises
Schedule 3.10(a) Description of Properties, Contracts and
Other Data (to Include All Items on Schedule
3.10(b))
Schedule 3.10(b) Generic List of Properties, Contracts and
Other Data
Schedule 3.11(a) Outstanding Litigation, Etc.
Schedule 3.11(c)(i) Authorizations and Permits
Schedule 3.11(c)(ii)Exceptions to Authorizations and Permits
Schedule 3.12 Accounts Receivable Aging Schedule
Schedule 3.13 Product or Service Liability Claims
Schedule 3.14 Insurance
Schedule 3.15 Employee Benefit and Pension Plans
Schedule 3.15(u) Retired Employees Receiving Uncovered
Payments
Schedule 3.17(a) Principal Customers
Schedule 3.17(b) Principal Suppliers
Schedule 3.19 Intellectual Property
Schedule 4.3 Buyer's Notices and Consents
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PURCHASE AGREEMENT
This Purchase Agreement (this "Agreement") is entered into
on June 11, 1998, by and between ICG D.C. Holdings, Inc., a
Colorado corporation ("Buyer"), and G. Xxxxxx Xxxxx ("Xxxxx"),
and the G. Xxxxxx Xxxxx Trust (the "Trust"), and Xxxxxxx X.X.
Fought ("Fought"), T&D Consulting, Inc. and the Xxxxxx X. Xxxx
Daughters Trust (collectively with Fought, the "Minority
Members"). Xxxxx, the Trust and the Minority Members are herein
collectively referred to as "Sellers" and individually, as a
"Seller".
RECITALS
A. Sellers (except for Xxxxx) are all of the members of
and own all of the interests in DataChoice Network Services,
L.L.C., a Nevada limited liability company (the "Company").
X. Xxxxxxx desire to sell, and Buyer desires to purchase,
all of the interests (the "Interests") in the Company as provided
in this Agreement.
AGREEMENT
The parties agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1 For purposes of this Agreement:
Adverse Consequences means all losses, damages, costs,
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expenses, fees, Liabilities or other adverse consequences of any
nature, however caused or incurred.
Affiliate means, with respect to any Person, any Person
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Controlling, Controlled by or under common Control with such
Person.
Affiliated Group means any affiliated group within the
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meaning of Code Section 1504 or any similar group defined under a
similar provision of state, local or foreign law.
Xxxxx means G. Xxxxxx Xxxxx.
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Assets means all right, title and interest of the Company in
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and to all of the Company's tangible and intangible assets.
Basket Amount has the meaning set forth in Section 8.6(a).
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Benefit Arrangements has the meaning set forth in Section
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3.15(c).
Business Day means any day on which commercial banks are
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open for business in Denver, Colorado.
Buyer has the meaning set forth in the preamble to this
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Agreement.
Closing and Closing Date have the meanings given in Section
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2.6.
Closing Date Liabilities means all Liabilities and other
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amounts for which Sellers are liable under Sections 2.4, 5.7,
and 10.10.
Code means the Internal Revenue Code of 1986, as amended.
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Company has the meaning set forth in Recital A.
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Company Employee Welfare Benefit Plan has the meaning set
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forth in Section 3.15(a).
Confidential Information means, with respect to any Person,
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any information concerning such Person or its business, products,
financial condition, prospects and affairs that is not already
generally available to the public.
Control means the power to direct the management or policies
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of any Person, through the power to vote shares or other equity
interests, by contract or otherwise.
Documents has the meaning set forth in Section 3.21.
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Employee Welfare Benefit Plan has the meaning set forth in
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ERISA Section 3(1).
Employment Agreement means the Employment Agreement between
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Buyer and Fought, substantially in the form attached as
EXHIBIT A.
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Encumbrance means any mortgage, pledge, conditional sale
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agreement, charge, claim, interest of another Person, lien,
security interest, title defect or other encumbrance.
Environmental Obligations means all Legal Requirements and
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Permits concerning land use, public health, safety, welfare or
the environment, including, without limitation, the Resource
Conservation and Recovery Act (42 U.S.C. (Section) 6901 et seq.),
-- ---
as amended, and the Comprehensive Environmental Response,
Compensation, and Liability Act (42 U.S.C. (Section) 9601
et seq.), as amended.
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ERISA means the Employee Retirement Income Security Act of
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1974, as amended, and any regulations, rules or orders
promulgated under the Employee Retirement Income Security Act of
1974, as amended.
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ERISA Affiliate means any entity that is controlled by, or
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is under common control with, the Company, as determined under
ERISA Section 4001(a)(14).
Escrow Agent means Norwest Bank Colorado, N.A.
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Escrow Agreement means the Escrow Agreement among Buyer,
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Sellers and the Escrow Agent in the form of EXHIBIT B.
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Escrow Period means the period commencing on the Closing
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Date and ending on the date which is twelve months after the
Closing Date.
Financial Statements has the meaning set forth in Section
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3.6.
Fought means Xxxxxxx X.X. Fought.
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Free Up Date has the meaning set forth in Section 6.8.
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GAAP means generally accepted accounting principles as in
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effect from time to time in the United States.
Governmental Authority means the United States of America or
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any foreign jurisdiction, any state, commonwealth, territory or
possession of the United States of America or any such foreign
jurisdiction, any political subdivision of any of them (including
counties, municipalities, home-rule cities and the like), and any
agency, authority or instrumentality of any of the foregoing,
including, without limitation, any court, tribunal, department,
bureau, commission or board.
Hazardous Materials means any material, chemical, compound,
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mixture, hazardous substance, hazardous waste, pollutant or
contaminant defined, listed, classified or regulated under any
Environmental Obligation.
ICG means ICG Communications, Inc., a Delaware corporation.
---
ICG Shares means the newly-issued shares of common stock of
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ICG payable to Sellers under Section 2.2.
Indemnified Party has the meaning set forth in Section
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8.3(a).
Indemnifying Party has the meaning set forth in Section
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8.3(a).
Intellectual Property means (a) all inventions (whether
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patentable or unpatentable and whether or not reduced to
practice), all improvements thereto, and all patents, patent
applications and patent disclosures, together with all
reissuances, continuations, continuations-in-part, revisions,
extensions and reexaminations thereof, (b) all trademarks,
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service marks, trade dress, logos, trade names and corporate
names, including the name "DataChoice Network Services, L.L.C.,"
"DataChoice," and "DataChoice Network," together with all
translations, adaptations, derivations and combinations thereof
and including all goodwill associated therewith, and all
applications, registrations and renewals in connection therewith,
(c) all copyrightable works, all copyrights and all applications,
registrations and renewals in connection therewith, (d) all mask
works and all applications, registrations and renewals in
connection therewith, (e) all trade secrets and confidential
business information (including ideas, research and development,
know-how, formulas, compositions, manufacturing and production
processes and techniques, technical data, designs, drawings,
specifications, customer and supplier lists, pricing and cost
information, and business and marketing plans and proposals), (f)
all computer software (including data and related documentation),
(g) all other proprietary rights and (h) all copies and tangible
and intangible embodiments thereof (in whatever form or medium).
Interests means all of the membership interests issued by
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the Company to all of its members.
Latest Balance Sheet means the unaudited balance sheet of
--------------------
the Company and the related unaudited statements of income,
expense and cash flow dated as of April 30, 1998 and attached as
SCHEDULE 1.1(I).
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Legal Requirement means any constitution, statute,
-----------------
ordinance, code, or other law (including common law), rule,
regulation, Order, notice, standard, procedure or other
requirement enacted, adopted, applied or issued by any
Governmental Authority, including, without limitation, judicial
decisions.
Liability means any liability or obligation (whether known
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or unknown, whether asserted or unasserted, whether absolute or
contingent, whether accrued or unaccrued, whether liquidated or
unliquidated, and whether due or to become due).
Material Adverse Effect means, with respect to the Company
-----------------------
or its businesses, assets, financial condition, properties or
prospects, any event, fact, circumstance or condition that in the
aggregate may result in an adverse impact to the Company that
would exceed $20,000.
Minority Members has the meaning set forth in the preamble
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to this Agreement.
Nasdaq means the Automated Quotation System of the National
------
Association of Securities Dealers, Inc.
Nasdaq Market means the Nasdaq National Market.
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Noncompetition Agreements means the Noncompetition
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Agreements between Buyer and each of Xxxxx and Fought, the form
of each of which is attached as EXHIBIT C.
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Orders means all judgments, injunctions, orders, rulings,
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decrees, directives, notices of violation or other requirements
of any Governmental Authority or arbitrator having jurisdiction
in the matter, including a bankruptcy court or trustee.
Other Buyer Agreements means the Escrow Agreement, the
----------------------
Employment Agreements, the Noncompetition Agreements, the
Registration Rights Agreement and the other documents and
instruments executed and delivered by Buyer pursuant to Section
7.2 of this Agreement.
Other Seller Agreements means the Employment Agreement, the
-----------------------
Escrow Agreement, the Noncompetition Agreements, the Registration
Rights Agreement, and other documents and instruments executed
and delivered by Sellers pursuant to Section 7.1 of this
Agreement.
Permits means all permits, licenses, consents, franchises,
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authorizations, approvals, privileges, waivers, exemptions,
variances, exclusionary or inclusionary Orders and other
concessions, whether governmental or private, including, without
limitation, those relating to environmental, public health,
welfare or safety matters.
Permitted Liabilities means, with respect to the Company,
---------------------
(a) indebtedness for borrowed money in an amount equal to the
indebtedness incurred and outstanding as of December 31, 1997 as
reflected on the Latest Balance Sheet, (b) all other liabilities
reflected on the Latest Balance Sheet, and (c) current
liabilities consisting of trade payables and current expenses of
the Company incurred in the ordinary course of business since
December 31, 1997, consistent with past practice.
Person means an individual, and a partnership, corporation,
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association, joint stock company, trust, joint venture, limited
liability company, unincorporated organization, Governmental
Authority or other entity.
Premises means the real property, buildings and improvements
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on such real property constituting the business premises of the
Company as described on SCHEDULE 3.9(B).
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Premises Lease means the lease agreement, in form and
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substance satisfactory to Buyer, between Buyer and Southwest
Plaza - GGPLP, as lessor with respect to Premises leased by the
Company in Littleton, Colorado, under which Buyer will lease the
Premises following Closing.
Principal Customers has the meaning set forth in Section
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3.17(a).
Principal Suppliers has the meaning set forth in Section
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3.17(b).
Purchase Price means the sum of $5,000,000.
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Registration Rights Agreement means the agreement between
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ICG and Sellers in the form attached as EXHIBIT D.
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Reply Notice has the meaning set forth in Section 2 of the
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Escrow Agreement.
Reply Period has the meaning set forth in Section 2 of the
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Escrow Agreement.
Right means any right, property interest, concession,
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patent, trademark, trade name, copyright, know-how or other
proprietary right of another Person.
SEC Reports has the meaning set forth in Section 4.7.
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Securities Act means the Securities Act of 1933, as amended,
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and all rules and regulations promulgated thereunder.
Seller Transaction Expenses has the meaning set forth in
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Section 10.10.
Sellers' Agent means G. Xxxxxx Xxxxx.
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Seller and Sellers have the meaning set forth in the
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preamble to this Agreement.
Survival Period means, with respect to a representation or
---------------
warranty, the applicable period after the Closing Date during
which such representation or warranty survives pursuant to
Section 8.4.
Tax means any federal, state, local or foreign income, gross
---
receipts, license, payroll, employment, excise, severance, stamp,
occupation, premium, windfall profits, environmental (including
taxes under Code Section 59A), customs duties, capital stock,
franchise, profits, withholding, social security (or similar),
unemployment, disability, real property, documentary, personal
property, sales, use, transfer, registration, value added,
alternative or add-on minimum, estimated or other tax of any kind
whatsoever, or any escheat obligations, including any interest,
penalty or addition, whether disputed or not.
Tax Return means any return, declaration, report, claim for
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refund or information return or statement relating to Taxes,
including any schedule or attachment to any of them, and
including any amendment of any of them.
Third Party Claim has the meaning set forth in Section
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8.3(a).
ARTICLE II
PURCHASE AND SALE
SECTION 2.1 Basic Transaction. Subject to the terms and
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conditions set forth in this Agreement, Buyer agrees to purchase
from Sellers, and Sellers agree to sell to Buyer, all of the
Interests, free and clear of any Encumbrance or Tax, for the
consideration specified in Section 2.2. Buyer will have no
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obligation under this Agreement to purchase less than all of the
Interests.
SECTION 2.2 Purchase Price; Payment. The Purchase Price for
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the Interests will be payable in the form of (a) $560,000 in
cash, and (b) 145,997 ICG Shares. On the Closing Date Buyer will
(x) pay to Sellers in cash by wire transfer to an account or
accounts designated by Sellers' Agent the amount of $560,000 in
cash, (y) pay to Sellers 129,556 ICG Shares and (z) deposit
16,441 ICG Shares with the Escrow Agent pursuant to the terms of
the Escrow Agreement. In addition to the Purchase Price, at the
Closing Buyer will pay Xxxxx the sum of $250,000 and Fought the
sum of $250,000, each such amount to be payable in cash, in
consideration for Xxxxx'x and Fought's obligations under the
Noncompetition Agreements.
SECTION 2.3 [Intentionally Omitted].
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SECTION 2.4 Payment of Certain Amounts. Sellers will pay,
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and bear sole liability for, the following costs, expenses,
amounts and claims: (a) all Taxes, fees and charges payable in
respect of or as a result of the sale and transfer of the
Interests to Buyer pursuant to this Agreement; (b) all Seller
Transaction Expenses in excess of $10,000 in the aggregate, and
the amounts described in Section 5.7 and (c) all amounts owing to
employees (other than claims for earned commissions) and other
Persons arising out of events or circumstances occurring prior to
or as a result of the Closing. Upon receipt of evidence
reasonably satisfactory to Buyer of liability therefor on payment
thereof, Buyer will reimburse Sellers, pay, or bear liability
for, as the case may be, all Seller Transaction Expenses in an
amount not to exceed $10,000 in the aggregate.
SECTION 2.5 [Intentionally Omitted].
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SECTION 2.6 Closing; Closing Date. The closing of the
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transactions contemplated by this Agreement (the "Closing") will
take place within five Business Days after the satisfaction or
waiver of all conditions set forth in Sections 7.1 and 7.2, at
the offices of Xxxxxxx & Xxxxxx L.L.C. in Denver, Colorado, and
all transactions contemplated by this Agreement will be effective
at 12:00 a.m. local time in Denver, Colorado, on the day of the
Closing (such effective time being the "Closing Date").
SECTION 2.7 Deliveries at the Closing. At the Closing, (a)
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Sellers will deliver, or cause to be delivered, to Buyer the
certificates, instruments and documents referred to in
Section 7.1, (b) Buyer will deliver to Sellers the certificates,
instruments and documents referred to in Section 7.2, (c) Sellers
will deliver to Buyer assignments of the Interests in the form of
EXHIBIT E, free and clear of any Encumbrances or Taxes and (d)
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Buyer will pay and deposit the purchase price in accordance with
Section 2.2.
SECTION 2.8 Waiver of Rights of First Refusal. Sellers
---------------------------------
waive all rights of first refusal arising under Section 10.02 of
the Operating Agreement of the Company effective as of April 25,
1996.
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ARTICLE III
REPRESENTATIONS AND WARRANTIES OF SELLERS
Sellers jointly and severally represent and warrant to Buyer
as follows, as of the date of this Agreement:
SECTION 3.1 Organization, Good Standing, Etc. (a) The
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Company is a limited liability company duly organized, validly
existing and in good standing under the laws of the State of
Nevada, and is qualified and authorized to do business as a
foreign limited liability company and is in good standing in each
of the jurisdictions listed on SCHEDULE 3.1(A)(I), which are the
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only jurisdictions in which the nature of the business conducted
by the Company or the properties leased or operated by it make
such qualification necessary. The Company has all requisite
power and authority to own, lease and operate its properties and
to carry on its business as is now being conducted. The copies
of (i) the articles of organization (certified by the Secretary
of State of its jurisdiction of organization) and (ii) the
operating agreement of the Company, both as amended to date,
which have been delivered to Buyer by Sellers, and are attached
as SCHEDULES 3.1(A)(II) and 3.1(A)(III),
------------------------------------
respectively, are complete and correct, and the Company is not in
default under or in violation of any provision of its articles of
organization or operating agreement. The minute books, which
contain the records of all meetings of or actions by the members
of the Company, and the record books of the Company, copies of
which have been delivered to Buyer by Sellers, are correct and
complete.
SECTION 3.2 Subsidiaries. The Company does not own any
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equity or other interest in any other corporation, limited
liability company, partnership or any other Person.
SECTION 3.3 Ownership and Capitalization. The interests
----------------------------
issued by the Company are described on SCHEDULE 3.3 and as of the
------------
date of this Agreement such interests are owned by such Persons
and in such percentages as is set forth on SCHEDULE 3.3. All of
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the interests issued by the Company have been validly issued, and
are fully paid and nonassessable, with no personal Liability
attaching to the ownership of such interests. There is no
authorized or outstanding equity interest or security convertible
into or exchangeable for, or any authorized or outstanding
option, warrant or other right to subscribe for or to purchase,
or convert any obligation into, any unissued interests in the
Company and the Company has not agreed to issue any security so
convertible or exchangeable or any such option, warrant or other
right. There are no authorized or outstanding equity
appreciation, phantom equity, profit participation, equity
participation or other similar rights with respect to the
Company. There are no voting trusts, voting agreements, proxies
or other agreements or understanding with respect to any of the
Interests. There are no existing rights of first refusal, buy-
sell arrangements, options, warrants, rights, calls, or other
commitments or restrictions of any character relating to any of
the Interests, except those restrictions on transfer imposed by
the Securities Act and applicable state securities laws.
SECTION 3.4 Authority; No Violation. Sellers (and each of
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them individually) have full and absolute right, power, authority
and legal capacity to execute, deliver and perform this Agreement
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and all Other Seller Agreements to which Sellers are a party, and
assuming the due authorization, execution and delivery by such
other Persons as are parties thereto, this Agreement constitutes,
and the Other Seller Agreements when executed and delivered by
the parties thereto will constitute, the legal, valid and binding
obligations of, and will be enforceable in accordance with their
respective terms against, Sellers (and each of them
individually), except as such enforcement is subject to the
effect of (i) any applicable bankruptcy, insolvency,
reorganization or similar laws relating to or affecting
creditors' rights generally, and (ii) general principles of
equity, including concepts of reasonableness, good faith and fair
dealing, and other similar doctrines affecting the enforceability
of agreements generally (regardless of whether considered in a
proceeding in equity or at law). The execution, delivery and
performance of this Agreement and the Other Seller Agreements and
the consummation of the transactions contemplated by each such
agreement will not (a) violate any Legal Requirement to which the
Company or any Seller is subject or any provision of the articles
of organization or operating agreement of the Company, or (b)
violate, with or without the giving of notice or the lapse of
time or both, or conflict with or result in the breach or
termination of any provision of, or a diminution of the rights of
the Company under, or constitute a default under, or give any
Person the right to accelerate any obligation under, or result in
the creation of any Encumbrance upon any properties, assets or
business of the Company or of any Seller, pursuant to any
indenture, mortgage, deed of trust, lien, lease, license, Permit,
agreement, instrument or other arrangement to which the Company
or any Seller is a party or by which the Company or any Seller,
or any of their respective assets and properties is bound or
subject.
SECTION 3.5 Consents and Approvals. Except as set forth in
----------------------
SCHEDULE 3.5, no filing or registration with, no notice to and no
------------
permit, authorization, consent or approval of any Governmental
Authority or any Person is necessary for the consummation by
Sellers of the transactions contemplated by this Agreement other
than (a) requirements of federal and securities laws, (b) the
authorization of all applicable regulatory agencies necessary or
desirable to consummate the transactions contemplated by this
Agreement and (c) those consents and approvals already obtained
as described on Schedule 3.5.
------------
SECTION 3.6 Financial Statements. Sellers have delivered
--------------------
to Buyer complete and correct copies of the Company's (a)
unaudited balance sheets, income statements and related
statements of cash flow and members' equity for and as of the
year December 31, 1996 and the period May 1, 1996 through
December 31, 1997 and (b) unaudited balance sheets, income
statements and the statements of cash flow for the periods ending
January 31, 1998, February 28, 1998, March 31, 1998 and April 30,
1998, (collectively, the "Financial Statements"). The Financial
Statements are in accordance with the books and records of the
Company, as applicable, and were prepared on a consistent basis
throughout the periods covered and present fairly the Company's
financial position, results of operations and changes in
financial position as of the dates and for the periods indicated.
At the date of the Latest Balance Sheet, the Company had no known
liability or obligation, whether accrued, absolute, fixed or
contingent (including liabilities for taxes or unusual forward or
long-term commitments), that were not fully reflected or reserved
against on the Latest Balance Sheet, business, financial
condition or results of operations of the Company, nor does the
Company have any contingent Liabilities not disclosed on the
-9-
Financial Statements. Copies of the financial statements
described in clause (a) of this Section 3.6 are attached as
SCHEDULE 3.6(A), and copies of the financial statements
---------------
described in clause (b) of this Section are attached as
SCHEDULE 3.6(B). All balance sheets, statements of revenue and
--------------
expense and other financial statements prepared by or with
respect to the Company after the date of this Agreement will be
prepared in accordance with and on a basis and in a manner
consistent with the Financial Statements.
SECTION 3.7 Absence of Certain Changes or Events. Since
------------------------------------
December 31, 1997, and except as disclosed in SCHEDULE 3.7, the
------------
Company has not: (a) incurred any debt, indebtedness or other
Liability, except Permitted Liabilities; (b) delayed or postponed
the payment of accounts payable or other Liabilities or
accelerated the collection of any receivable beyond stated,
normal terms; (c) sold or otherwise transferred any of its
equipment or other assets or properties that are, individually or
in the aggregate, material to the Company; (d) cancelled,
compromised, settled, released, waived, written-off or expensed
any account or note receivable, right, debt or claim involving
more than $10,000 individually or in the aggregate; (e) changed
in any significant manner the way in which it conducts business;
(f) made or granted any individual wage or salary increase or any
additional benefits of any kind or nature or modified any
commission or compensation arrangement applicable to any employee
of the Company; (g) entered into any contracts or agreements, or
made any commitments, involving more than $10,000 individually or
in the aggregate or accelerated, terminated, delayed, modified or
cancelled any agreement, contract, lease or license (or series of
related agreements, contracts, leases and licenses) involving
more than $10,000 individually or in the aggregate; (h) suffered
any Material Adverse Effect, including to or in its business,
assets, financial condition, prospects or customer or supplier
relationships; (i) made any payment or transfer to or for the
benefit of any Seller or permitted any Person, including, without
limitation, any Seller, to withdraw assets from the Company other
than as disclosed on SCHEDULE 3.7;
------------
(j) suffered any other significant occurrence, event, incident,
action, failure to act or transaction outside the ordinary course
of business consistent with past practice, (k) engaged in any
other activity outside the ordinary course of business consistent
with past practice, or (l) agreed to incur, take, enter into,
make or permit any of the matters described in clauses
(a) through (k).
SECTION 3.8 Tax Matters.
-----------
(a) The Company has timely filed all Tax Returns it was
required to file. All such Tax Returns are correct and complete
in all material respects. All Taxes owed by the Company and by
each Seller (whether or not shown on any Tax Return) have been
paid. The Company is not, and no Seller is, currently the
beneficiary of any extension of time within which to file any Tax
Return. No claim has ever been made by an authority in a
jurisdiction where the Company does not file Tax Returns that it
is or may be subject to taxation by that jurisdiction. There are
no Encumbrances on any of the assets of the Company or on those
of any Seller that arose in connection with any failure (or
alleged failure) to pay any Tax.
-10-
(b) The Company has withheld and paid all Taxes required to
have been withheld and paid in connection with amounts paid or
owing to any employee, independent contractor, creditor, any
Seller or other third party.
(c) There is no known basis for any authority to assess any
additional Taxes for any period for which Tax Returns of the
Company or any Seller have been filed. There is no pending or
threatened dispute or claim concerning any Tax Liability of the
Company or of any Sellers. SCHEDULE 3.8(C) lists all federal,
---------------
state, local and foreign income Tax Returns filed with respect to
the Company and each Seller for taxable periods ended on or after
December 31, 1996. No such Tax Return has ever been audited.
Sellers have delivered to Buyer correct and complete copies of
all federal income Tax Returns, examination reports, and
statements of deficiencies filed or assessed against or agreed to
by the Company since December 31, 1996.
(d) Neither the Company nor any Seller has waived any
statute of limitations in respect of Taxes or agreed to any
extension of time with respect to a Tax assessment or deficiency.
(e) SCHEDULE 3.8(E) sets forth the basis of the Company in
---------------
each of its assets as of December 31, 1997.
(f) All Taxes payable by all present and former members of
the Company in respect of the Company's taxable income have been
paid.
(g) The Company has not made any election to be classified
as a corporation taxable as an association for federal, state or
foreign tax purposes.
SECTION 3.9 Assets and Properties.
---------------------
(a) Except as disclosed on SCHEDULE 3.9(A), as of the date
---------------
of this Agreement, the Company owns all of its Assets, free and
clear of all Encumbrances and the Company has and will have good
and marketable title to (or, in the case of the Assets that are
leased, valid leasehold interests in) all of its Assets. The
Assets consist of the tangible and intangible assets of the
Company in existence as of the date of this Agreement (except for
such changes in accounts receivable in the ordinary course of
business as are not in violation of Section 3.7). The Assets of
the Company are all of the tangible and intangible assets used by
the Company in, or necessary for the conduct of, its business.
The Assets and any property leased by the Company from third
parties encompass all Assets and all property used by the Company
to generate the income reflected in the financial statements
attached as SCHEDULES 3.6(A) AND 3.6(B). SCHEDULE 3.9(A) lists
--------------------------- ---------------
all the equipment leased by the Company as of the date of this
Agreement. The Company does not lease any equipment from any
Seller. All of the tangible Assets of the Company are located on
the Premises.
(b) SCHEDULE 3.9(B) sets forth a description of all of the
---------------
real property, buildings and improvements used by the Company in
its business (the "Premises"). The Premises are supplied with
-11-
utilities and other services necessary for the operation of the
Premises. The Premises are free from defects, have been
maintained in accordance with normal industry practice, are in
good operating condition and repair and are suitable for the
purposes for which they presently are used. The Premises have
received all approvals of Governmental Authorities (including
Permits) required in connection with the occupation and operation
of the Premises and have been occupied, operated and maintained
in accordance with applicable Legal Requirements. None of
Sellers or the Company has received notice of violation of any
Legal Requirement or Permit relating to its operations or its
leased properties.
(c) No party to any lease with respect to any Premises has
repudiated any provision of such lease, and there are no
disputes, oral agreements or forbearance programs in effect as to
any such lease.
SECTION 3.10 Lists of Properties, Contracts and Other Data.
----------------------------------------------
Attached as SCHEDULE 3.10(B) is a generic list of certain
---------------
properties, contracts and other data. SCHEDULE 3.10(A) is a
----------------
correct and complete description for the Company setting forth
the properties, contracts and other data of the Company as of
March 31, 1998 that are identified on SCHEDULE 3.10(B). True and
----------------
complete copies of the items (or descriptions of such items)
referred to in SCHEDULE 3.10(A) have been delivered to Buyer or
----------------
provided to Buyer for inspection. The contracts, contractual
obligations and other Rights described in SCHEDULE 3.10(A) are
----------------
valid, in full force and effect, enforceable in accordance with
their respective terms for the period stated, and, to the
knowledge of Sellers, no party has repudiated any provision
thereof and no action or claim is pending or threatened to
revoke, modify, terminate or render invalid any of such items.
Neither the Company nor, to the knowledge of Sellers, any Other
Party is in breach or default in performance of any of its
respective obligations under, and no event exists which, with the
giving of notice or lapse of time or both, would constitute a
breach, default or event of default on the part of a party to,
any of the foregoing contracts, contractual obligations or Rights
that is continuing unremedied.
SECTION 3.11 Litigation; Compliance with Applicable Laws,
---------------------------------------------
Rights and Permits.
-------------------
(a) There is no outstanding Order against, nor, except as
set forth on SCHEDULE 3.11(A), is there any litigation,
----------------
proceeding, arbitration or investigation by any Governmental
Authority or other Person pending or threatened against, the
Company, its properties or business or relating to the
transactions contemplated in this Agreement, nor is there any
basis for any such action.
(b) The Company and its Assets (including its Premises,
facilities, machinery and equipment and the use thereof) are not
in violation of any applicable Legal Requirement or right. None
of Sellers or the Company has received notice from any
Governmental Authority or other Person of any violation or
alleged violation of any Legal Requirement or Right, and no
action, suit, proceeding, hearing, investigation, charge,
complaint, claim, demand or notice has been filed or commenced or
is pending or threatened against the Company.
-12-
(c) SCHEDULE 3.11(C)(I) lists all authorizations and
-------------------
Permits held by the Company with respect to the operation of its
business. Each authorization and Permit listed in
SCHEDULE 3.11(C)(I) is valid and effective and the Company is in
-------------------
compliance with all material terms, conditions and requirements
of such authorizations and Permits. Except as set forth in
SCHEDULE 3.11(C)(II), the Company possesses all authorizations,
--------------------
Permits, licenses and Orders required or necessary to conduct its
business and operations in the manner in which such business and
operations are being and historically have been conducted.
SECTION 3.12 Accounts Receivable. The accounts receivable
-------------------
of the Company reflected on SCHEDULE 3.12 have arisen in the
-------------
ordinary course of business; reflect bona fide business
arrangements; no payor has given any Seller or the Company
written notice of any inability to pay such account receivable in
due course or of any claim or defense against payment of such
account receivable; no oral statements to such effect have been
made to any Seller or the Company; no basis exists for any payor
to raise any claim or defense against payment with respect to any
such account receivable; and SCHEDULE 3.12 sets forth a true and
-------------
correct statement regarding the aging of such accounts receivable
as of the date of this Agreement.
SECTION 3.13 Product Quality, Warranty and Liability. All
---------------------------------------
products and services provided or delivered by the Company to
customers on or prior to the date of this Agreement conform to
applicable contractual commitments, express and implied
warranties, product and service specifications and quality
standards, and the Company has no Liability, and to the knowledge
of Sellers there is no basis for any Liability, for additional
service, replacement or repair or other damages in connection
with such products and services. No product or service provided
or delivered by the Company to customers on or prior to the date
of this Agreement is subject to any guaranty, warranty or other
indemnity beyond the applicable standard terms and conditions of
sale, rent or lease. The Company has no Liability and, to the
knowledge of Sellers there is no basis for any Liability, arising
out of any injury to a Person, property or otherwise as a result
of the ownership, possession, provision or use of any product or
service sold, rented, leased, provided or delivered by the
Company on or prior to the date of this Agreement. No product or
service liability claim has been asserted against the Company,
whether covered by insurance or not and whether litigation has
resulted or not, except as listed and summarized on
SCHEDULE 3.13.
--------------
SECTION 3.14 Insurance. The Company has policies of
---------
insurance (a) covering risk of loss on its Assets and (b)
covering products and services liability and liability for fire,
property damage, personal injury, and workers' compensation
coverage, all with responsible and financially sound insurance
carriers in adequate amounts and in compliance with governmental
requirements and in accordance with good industry practice.
SCHEDULE 3.14 sets forth a complete and accurate list of all
-------------
insurance policies of the Company and the annual premiums payable
thereunder. All such insurance policies are valid, in full force
and effect and enforceable in accordance with their respective
terms and no party has repudiated any provision of such policies.
Neither the Company, nor to the knowledge of Sellers, any other
party to any such policy, is in breach or default (including with
respect to the payment of premiums or the giving of notices) in
the performance of any of their respective obligations under any
-13-
such policy, and, to the knowledge of Sellers, no event exists
which, with the giving of notice or the lapse of time or both,
would constitute a breach, default or event of default, or permit
termination, modification or acceleration under any such policy.
There are no claims, actions, proceedings or suits arising out of
or based upon any of such policies and no basis for any such
claim, action, suit or proceeding exists. All premiums have been
paid on such policies as of the date of this Agreement. The
Company has been covered during its period of existence by
insurance in scope and amount customary and reasonable for the
businesses in which it has engaged during such period. There
have been no claims made during such period with respect to any
insurance coverage of the Company.
SECTION 3.15 Pension and Employee Benefit Matters.
------------------------------------
(a) The Company has not maintained and has no obligation to
contribute to any employee pension benefit plans, as defined in
ERISA Section 3(2), including any multiemployer plan, as defined
in ERISA Section 3(37). The Company has no ERISA Affiliates.
Schedule 3.15 sets forth each Employee Welfare Benefit Plan
-------------
maintained or contributed to by the Company and no such plan is
self-insured or self-funded by the Company, ("Company Employee
Welfare Benefit Plans").
(b) Any Company Employee Welfare Benefit Plan that is a
"Group Health Plan" (as defined in Code Section 5000(b)(I)) has
been administered in accordance with the requirements of Part 6
of Subtitle B of Title I of ERISA and Code Section 4980B, and
nothing done or omitted to be done in connection with maintenance
or administration of any Company Employee Welfare Benefit Plan
that is a Group Health Plan has made or will make the Company
subject to any liability under Title I of ERISA or any excise Tax
Liability under Code Section 4980B or has resulted or will result
in any loss of income exclusion for a participant under Code
Sections 105(h) or 106.
(c) The Company does not maintain, and has never
maintained, and does not contribute, and has never contributed,
and has never been required to contribute, to any employee
benefit plan, as defined in ERISA Section 3(3), providing health
or medical benefits for current or future retired or terminated
employees, their spouses or dependents (other than in accordance
with Code Section 4980B). SCHEDULE 3.15 lists each employment,
-------------
severance or other similar contract, arrangement or policy and
each plan or arrangement (written or oral) providing for
unemployment benefits, vacation benefits, deferred compensation,
bonuses, stock options, stock appreciation rights or other forms
of incentive compensation, reduced interest or interest free
loans, mortgages, relocation assistance, or other benefits that
(i) is not a Company Employee Welfare Benefit Plan; (ii) is
entered into, maintained or contributed to by the Company; and
(iii) covers any employee or former employee of the Company
(collectively, the "Benefit Arrangements"). Copies of each such
Benefit Arrangement (or, if unwritten, a written description of
each such Benefit Arrangement) have been delivered by the Company
to the Buyer.
-14-
SECTION 3.16 Employees and Labor. No executive or key
-------------------
employee is subject to any agreement, obligation, Order or other
legal hindrance that impedes or might impede such executive or
key employee from devoting his or her full business time to the
affairs of the Company, and, if such person becomes an employee
of Buyer, to the affairs of Buyer after the date of this
Agreement. The Company has, and has had, no pending labor
relations problems or disputes or charges or complaints of unfair
labor practices. There are no threatened or alleged claims,
investigations or requests for investigations or audits against
the Company, nor are there any outstanding orders relating to the
Company or any Seller with respect to any employment matter under
any federal or state employment law or employment practices,
including federal Title VII and related state protections. There
are no federal or state common law actions pending or, to the
knowledge of Sellers, threatened, associated with or relating to
any employee's or former employee's past or present employment
with the Company or termination thereof.
SECTION 3.17 Customer and Supplier Relationships.
-----------------------------------
(a) SCHEDULE 3.17(A) lists each customer that individually
----------------
or with its Affiliates accounted for five percent or more of the
Company's revenues during either the fiscal year ended
December 31, 1997 or the three-month period ended March 31, 1998
(the "Principal Customers").
(b) SCHEDULE 3.17(B) lists each supplier that individually
----------------
or with its affiliates accounted for 10 percent or more of the
Company's purchases of support services, supplies, or products
during either the fiscal year ended December 31, 1997 or the
three-month period ended March 31, 1998 (the "Principal
Suppliers").
(c) The Company has good commercial working relationships
with the Principal Customers and the Principal Suppliers and,
since December 31, 1997, no Principal Customer or Principal
Supplier has cancelled or otherwise terminated its relationship
with the Company, materially decreased or limited its
contribution of revenue to or support services, supplies or
products supplied to, the Company, or threatened to take any such
action. Sellers have no basis to anticipate any problems with
the Company's customer, supplier or business relationships. To
the knowledge of Sellers, no Principal Customer or Principal
Supplier has any plans to reduce its contribution of revenue to
or support services, supplies, or products supplied to the
Company below levels prevailing since December 31, 1997, and the
execution and delivery of this Agreement and the consummation of
the transactions contemplated by this Agreement will not
adversely affect the relationship of Buyer with any Principal
Supplier after the date of this Agreement.
SECTION 3.18 Environmental Matters. The Company has
---------------------
conducted its business and operations, and has occupied, used and
operated the Premises in compliance with all Environmental
Obligations. The Company owns no real property. To the
knowledge of Sellers, all the Company's leased property is in
full compliance with all Environmental Obligations. Neither the
Company nor any Seller on behalf of the Company has ever disposed
-15-
of any Hazardous Materials except cleaning supplies, and such
cleaning supplies have been disposed of in accordance with all
applicable Environmental Obligations. No Seller is aware of any
claim or order, or notice of claim or order, asserting Liability
of the Company or any Seller related to an Environmental
Obligation. The Company has not owned or used any underground or
aboveground storage tanks.
SECTION 3.19 Intellectual Property. SCHEDULE 3.19 lists
--------------------- -------------
each item of Intellectual Property owned by the Company or which
is used by the Company in the operation of its business. The
Company owns or has the legal right to use each such item of
Intellectual Property, and none of such Intellectual Property is
subject to any Encumbrance. No other individual or entity has
any claim or right to the Intellectual Property except as
specifically allowed by the Company. The Intellectual Property
does not contain any material which may infringe on the
intellectual property or proprietary rights of any third party.
The Intellectual Property is not the subject of any claim of
infringement by any third party.
SECTION 3.20 Brokers' Fees and Commissions. None of
-----------------------------
Sellers, the Company nor any of its respective directors,
officers, partners, employees or agents has employed any
investment banker, broker or finder in connection with the
transactions contemplated hereby, and none of Sellers, the
Company nor Buyer will have any liability to any such Persons on
account of any brokerage, finders or similar fee payable with
respect to the transactions contemplated by this Agreement.
SECTION 3.21 Acquisition for Investment. Sellers are
--------------------------
acquiring the ICG Shares pursuant to this Agreement for their own
account as principals, for investment purposes only, and not with
a view to, or for, resale, distribution or fractionalization
thereof, in whole or in part, and no other Person has a direct or
indirect beneficial interest in such ICG Shares. Sellers each
acknowledge and understand that the offering and sale of the ICG
Shares pursuant to this Agreement are intended to be exempt from
registration under the Securities Act by virtue of Section 4(2)
thereof and the provisions of Regulation D promulgated thereunder
and, therefore, cannot be resold unless they are registered under
the Securities Act or unless an exemption from registration is
available. In furtherance thereof, Sellers joint and severally
represent and warrant to and agree with Buyer and each other
Seller that:
(a) each Seller has the financial ability to bear the
economic risk for this investment, has adequate means for
providing for its current needs and contingencies and has no need
for liquidity with respect to the investment in such ICG Shares;
(b) Xxxxx is an "accredited investor" as that term is
defined in Rule 501(a) of Regulation D under the Securities Act;
(c) each Seller has been furnished with a copy of ICG's
Annual Report on Form 10-K for the fiscal years ended
September 30, 1996, and December 31, 1997, Transition Report on
Form 10-K for the period ended December 31, 1996, Forms 10-Q for
the quarters ended March 31, 1997, June 30, 1997, September 30,
1997 and March 31, 1998, proxy statements and Forms 8-K filed in
-16-
1997 and 1998 (collectively, the "Documents") and has evaluated
the risks of acquiring the ICG Shares based on the information
contained therein and in this Agreement;
(d) each Seller has been given the opportunity to ask
questions of, and receive answers from, the management of ICG
concerning the terms, conditions and other matters pertaining to
the investment in the ICG Shares, and has been given the
opportunity to obtain such additional information necessary to
verify the accuracy of the information contained in the Documents
in order for Sellers to evaluate the merits and risks of the
acquisition of such ICG Shares, and has not been furnished with
any other offering literature or prospectus except as described
herein;
(e) none of Sellers has been furnished with any oral or
written representation or oral or written information in
connection with the offering of such ICG Shares that is not
contained in the Documents or this Agreement; and
(f) each Seller has such knowledge and experience in
financial and business matters as to be capable of evaluating the
merits and risks of an acquisition of such ICG Shares and of
making an informed investment decision with respect thereto.
SECTION 3.22 Disclosure.
----------
(a) None of the documents or information provided to Buyer
by the Company, any of Sellers or any agent or employee of the
Company in the course of Buyer's due diligence investigation and
the negotiation of this Agreement and Article III of this
Agreement and the disclosure SCHEDULES referred to in Article III
---------
contains any known untrue statement of any material fact or omits
to state a material fact necessary in order to make the
statements contained in this Agreement or in such documents,
information or SCHEDULES not misleading. There is no known fact or
---------
circumstance which materially adversely affects the business,
prospects, condition, affairs or operations of the Company or any
properties or assets of the Company which has not been set forth in
this Agreement or in such documents, information or SCHEDULES.
---------
(b) Nothing in the disclosure SCHEDULES referred to in
---------
Article III will be deemed adequate to disclose an exception to a
representation or warranty made in this Agreement unless the
applicable disclosure SCHEDULE identifies the exception with
--------
particularity and describes the relevant facts in reasonable
detail. Without limiting the generality of the foregoing, the
mere listing (or inclusion of a copy) of a document or other item
will not be deemed adequate to disclose an exception to a
representation or warranty made in this Agreement (unless the
representation or warranty has to do with the existence of the
document or other item itself).
-17-
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer represents and warrants to Sellers as follows, as of
the date of this Agreement:
SECTION 4.1 Organization and Qualification, etc. Buyer is
-----------------------------------
a corporation duly organized, validly existing and in good
standing under the laws of the State of Colorado and has
requisite corporate power and authority to own, lease and operate
its properties and assets and to carry on its business as it is
now being conducted. Buyer is duly qualified to do business and
is in good standing in each jurisdiction where the nature of the
business conducted by it, or the properties leased or operated by
it make such qualification necessary.
SECTION 4.2 Authority Relative to Agreement. Buyer has the
-------------------------------
full and absolute right, corporate power and authority and legal
capacity to execute, deliver and perform this Agreement and all
Other Buyer Agreements, and to consummate the transactions
contemplated on its part by this Agreement and the Other Buyer
Agreements. The execution and delivery of this Agreement by
Buyer, and the consummation by Buyer of the transactions contem-
plated on its part by this Agreement and the Other Buyer
Agreements, have been duly authorized by Buyer's board of
directors. No other corporate approvals on the part of the board
of directors or shareholders of Buyer are necessary to authorize
the execution and delivery of this Agreement, and the Other Buyer
Agreements. This Agreement constitutes, and the Other Buyer
Agreements when executed and delivered by the parties thereto
will constitute, the legal, valid and binding obligations of, and
will be enforceable in accordance with their respective terms
against, Buyer, except as such enforcement is subject to the
effect of (i) any applicable bankruptcy, insolvency,
reorganization or similar laws relating to or affecting
creditors' rights generally, and (ii) general principles of
equity, including concepts of reasonableness, good faith and fair
dealing, and other similar doctrines affecting the enforceability
of agreements generally (regardless of whether considered in a
proceeding in equity or law).
SECTION 4.3 Non-Contravention. Except as set forth on
-----------------
SCHEDULE 4.3, the execution and delivery of this Agreement and
------------
the Other Buyer Agreements and the consummation by Buyer of the
transactions contemplated by this Agreement and by the Other
Buyer Agreements will not, (a) violate any provision of the
Articles of Incorporation or Bylaws of Buyer, or (b) violate, or
result, with the giving of notice or the lapse of time or both,
in a violation of, any provision of, or result in the accelera-
tion of or entitle any party to accelerate (whether after the
giving of notice or lapse of time or both) any obligation under,
or result in the creation or imposition of any encumbrance upon
any of the properties of Buyer pursuant to any provision of any
indenture, mortgage, deed of trust, lien, agreement, Permit,
license or instrument or any arrangement to which Buyer is a
party or by which any of its assets are bound or to which any of
its assets are subject and do not and will not violate or
conflict with any other material restriction of any kind or char-
acter to which Buyer is subject or by which any of its assets may
be bound, or (c) violate in any material respect any Legal
Requirement to which Buyer is subject.
-18-
SECTION 4.4 Government Approvals. No consent,
--------------------
authorization, order or approval of, or filing or registration
with, any governmental commission, board or other regulatory body
is required for or in connection with the execution and delivery
of this Agreement and the Other Buyer Agreements by Buyer, the
execution and delivery of this Agreement by Buyer, and the
consummation by Buyer of the transactions contemplated by this
Agreement and the Other Buyer Agreements.
SECTION 4.5 Brokers. All negotiations relative to this
-------
Agreement and the transactions contemplated by this Agreement
have been carried out by Buyer directly with Sellers and the
Company, without the intervention of any person on behalf of
Buyer in such manner as to give rise to any valid claim by any
Person against Buyer or any Seller for a finder's fee, brokerage
commission, or similar payment.
SECTION 4.6 Purchase for Investment. Buyer is acquiring
-----------------------
the Interests for its own account for investment purposes and not
with a view to distribution of the Interests. Buyer has such
knowledge and experience in financial and business matters so as
to be capable of evaluating the merits and risks of its
investment in the Interests. Buyer is an "accredited investor"
as that term is defined in Rule 501(a) of Regulation D under the
Securities Act. Buyer will not, directly or indirectly, dispose
of the Interests except in compliance with applicable federal and
state securities laws.
SECTION 4.7 SEC Reports and Nasdaq Compliance. Since
---------------------------------
January 1, 1996, ICG has made in a timely manner all material
filings (the "SEC Reports") required to be made by it under the
Securities Act and the Exchange Act. The SEC Reports, when
filed, complied in all material respects with all applicable
requirements of the Securities Act and the Exchange Act and the
securities laws, rules and regulations of any applicable state
and pursuant to any material Legal Requirement and did not
contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary in order
to make the statements made therein, in light of the
circumstances under which they were made, not misleading. Buyer
has delivered or made accessible to Sellers true, accurate and
complete copies of the SEC Reports which were filed by ICG with
the SEC since January 1, 1996. Buyer has taken or will take all
necessary actions to ensure the eligibility of the ICG Shares for
trading on the Nasdaq Market.
ARTICLE V
PRE-CLOSING COVENANTS
The parties agree as follows with respect to the period
between the execution of this Agreement and the Closing (or
subsequent thereto, as applicable).
SECTION 5.1 General. Each of the parties will use its
-------
commercially reasonable efforts to take all actions necessary,
proper or advisable in order to consummate and make effective the
transactions contemplated by this Agreement (including the
satisfaction, but not the waiver, of the closing conditions set
forth in Article VII) and the other agreements contemplated
-19-
hereby. Without limiting the foregoing, Sellers and Buyer will,
and Sellers will cause the Company to, give any notices, make any
filings and obtain any consents, authorizations or approvals
needed to consummate the transactions contemplated by this
Agreement.
SECTION 5.2 Operation and Preservation of Business.
--------------------------------------
Sellers will not cause or permit the Company to: (i) incur or
permit any liability other than a Permitted Liability; (ii)
dispose of any assets that are, individually or in the aggregate,
material to the Company; (iii) engage in any practice, take any
action or enter into any transaction outside the ordinary course
of its business consistent with past practice; (iv) make any
payment or transfer to or for the benefit of any Seller (other
than salaries paid to any Seller in amounts consistent with, and
in all other respects in accordance with, past practice); or (v)
make any distribution or payment in respect of any of the
Interests; provided, however, that in no event will any action be
taken or fail to be taken or any transaction be entered into
which would result in a breach of any representation, warranty or
covenant of any Seller.
SECTION 5.3 Full Access. Sellers will cause the Company to
-----------
permit Buyer and its agents to have full access at all reasonable
times, and in a manner so as not to interfere with the normal
business operations of the Company, to all Premises, properties,
personnel, books, records (including Tax records), contracts and
documents of or pertaining to the Company.
SECTION 5.4 Notice of Developments. Sellers will give
----------------------
prompt written notice to Buyer of any material development which
occurs after the date of this Agreement and affects the business,
Assets, liabilities, financial condition, operations, results of
operations, future prospects, representations, warranties,
covenants or disclosure SCHEDULES of the Company. No such
---------
written notice, however, will be deemed to amend or supplement
any disclosure SCHEDULES or to prevent or cure any
---------
misrepresentation, breach of warranty or breach of covenant;
provided that (a) if such written notice issued to Buyer prior to
the Closing discloses a breach by any Seller of any of Sellers'
representations, warranties or covenants; (b) Buyer waives such
breach under Section 7.1, and (c) the Closing occurs, Sellers
shall have no liability for such breach.
SECTION 5.5 Exclusivity. For a period ending on the
-----------
earlier of (a) the date 60 days after execution of this Agreement
by Buyer and Sellers and (b) 10 Business Days after the date all
regulatory approvals and other third party consents required to
consummate the transactions contemplated by this Agreement are
obtained, no Seller will, and no Seller will cause or permit the
Company to, (x) solicit, initiate or encourage the submission of
any proposal or offer from any Person relating to the acquisition
of any Interests or other equity interests, or any portion of the
assets of, the Company (including any acquisition structured as a
merger, consolidation or share exchange), (y) participate in any
discussions or negotiations regarding, furnish any information
with respect to, assist or participate in or facilitate in any
other manner any effort or attempt by any Person to do or seek
any of the foregoing or (z) provide any information concerning
the Company or its business or assets to any Person in connection
with any of the foregoing. No Seller will vote his Interest in
favor of any such transaction. Seller's Agent will notify Buyer
immediately if any Person makes any proposal, offer, inquiry or
-20-
contact with respect to any of the foregoing and will provide
Buyer such details of such offer as Buyer may reasonably request.
This Section 5.5 will survive the termination of this Agreement.
SECTION 5.6 Announcements. Prior to the Closing, except as
-------------
may be required by law (including in the case of Buyer,
disclosure requirements under applicable securities laws), no
party shall issue any press release or make any public
announcement relating to the subject matter of this Agreement
without the prior written approval of the other parties.
SECTION 5.7 Payment By Sellers of Employee Claims and Other
-----------------------------------------------
Expenses. Sellers prior to or concurrently with the Closing will
---------
pay in cash all claims (other than claims for earned commissions) of
employees or former employees of the Company arising out of events
or circumstances occurring prior to or as a result of the Closing.
SECTION 5.8 Closing Date Liabilities and Distribution.
-----------------------------------------
Prior to the Closing Date or concurrently with the Closing,
Sellers shall pay in full in cash all known Closing Date
Liabilities, the amount of which is then ascertainable, including
any Seller Transaction Expenses in excess of $10,000 in the
aggregate. Following the Closing, Sellers shall promptly pay in
full all other Closing Date Liabilities (including all Seller
Transaction Expenses in excess of $10,000 in the aggregate) as
such Liabilities become due. Effective as of immediately prior
to the Closing Date, Sellers hereby jointly and severally assume
all Closing Date Liabilities, including all Seller Transaction
Expenses in excess of $10,000 in the aggregate, without further
action by Sellers, the Company or any other Person. To the
extent the Company has paid any Closing Date Liabilities,
including any Seller Transaction Expenses in excess of $10,000 in
the aggregate, which have not been reimbursed by Sellers to the
Company prior to the Closing, Sellers will reimburse such Company
in cash within two Business Days of the Closing Date.
SECTION 5.9 Confidentiality. Buyer, Sellers and the
---------------
Company shall keep, and shall cause their respective employees,
agents, attorneys, accountants and other advisors to keep,
confidential the existence, terms and conditions of this
Agreement and all communications and discussions between or among
Buyer, Sellers and the Company. Without the consent of Buyer and
Sellers' Agent, except as may be required by law (including, in
the case of Buyer, disclosure requirements under applicable
securities laws), neither Buyer, any Seller nor any of the
Company shall make any disclosure of the information described in
this Section 5.9. Nothing contained in this Agreement shall be
construed to prohibit any party from disclosing the information
described in this Section 5.9 or any Confidential Information in
connection with the institution or defense of any claim pursuant
to this Agreement or other claims which may be the subject of
judicial proceedings.
SECTION 5.10 Consents and Approvals. The parties hereto
----------------------
will cooperate with one another and use all commercially
reasonable efforts to prepare all necessary documentation to
effect promptly all necessary filings and to obtain all necessary
Permits, consents, approvals, orders and authorizations of, or
any exemptions by, all third parties and Governmental Authorities
necessary to consummate the transactions contemplated by this
Agreement. Each party will keep the other parties apprised of
the status of any inquiries made of such party by any
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Governmental Authority or members of their respective staffs with
respect to this Agreement or the transactions contemplated
hereby.
ARTICLE VI
POST-CLOSING COVENANTS
The parties agree as follows with respect to the period
following the Closing.
SECTION 6.1 Further Assurances. In case at any time after
------------------
the Closing any further action is necessary or desirable to carry
out the purposes of this Agreement, each of the parties will take
such further action (including the execution and delivery of such
further instruments and documents) as any Other Party reasonably
may request, all at the sole cost and expense of the requesting
party (unless the requesting party is entitled to indemnification
therefor under Article VIII).
SECTION 6.2 Transition. No Seller will take any action at
----------
any time that is designed or intended to have the effect of
discouraging any customer, supplier, lessor, licensor or other
business associate of the Company from establishing or continuing
a business relationship with the Company or any other Person,
including Buyer, after the Closing.
SECTION 6.3 Cooperation. In the event and for so long as
-----------
any party actively is contesting or defending against any action,
suit, proceeding, hearing, investigation, charge, complaint,
claim or demand in connection with (a) any transactions
contemplated by this Agreement or (b) any fact, situation,
circumstance, status, condition, activity, practice, plan,
occurrence, event, incident, action, failure to act or
transaction on or prior to the Closing Date involving any of the
Assets of the Company or the Company's business, each of the
other parties will cooperate with such party and its counsel in
the contest or defense, make available their personnel, and
provide such testimony and access to their books and records as
shall be reasonably necessary in connection with the contest or
defense, all at the sole cost and expense of the contesting or
defending party (unless the contesting or defending party is
entitled to indemnification therefor under Article VIII).
SECTION 6.4 Confidentiality. Sellers will treat and hold
---------------
as confidential all Confidential Information concerning Buyer and
the Company's business or Assets, refrain from using any such
Confidential Information and deliver promptly to Buyer or
destroy, at the request and option of Buyer, all of such
Confidential Information in its or their possession.
SECTION 6.5 Post-Closing Announcements. Following the
--------------------------
Closing, no Seller will issue any press release or make any
public announcement relating to the subject matter of this
Agreement without the prior written approval of Buyer.
SECTION 6.6 Financial Statements. Sellers will, upon
--------------------
request of Buyer, cooperate on a reasonable basis with Buyer to
produce such historical and on-going financial statements and
-22-
audits as Buyer may request. Buyer will reimburse Sellers for
any reasonable out-of-pocket costs incurred in providing such
cooperation.
SECTION 6.7 Satisfaction of Liabilities. Promptly
---------------------------
following the Closing, Sellers will pay (and reimburse the
Company, as applicable as provided in Section 5.8) and perform
all Closing Date Liabilities (to the extent not paid at or prior
to the Closing Date) and all Taxes attributable to or arising
from the transactions contemplated by this Agreement.
SECTION 6.8 Sales of ICG Shares. Following the Closing
-------------------
Date, Sellers will not sell any of the ICG Shares issued pursuant
to this Agreement until and after the earlier of the date (the
"Free Up Date") that is (a) the earlier of nine months after the
Closing Date or April 1, 1999, or (b) such earlier date as Buyer
and Sellers mutually agree in writing. Following the Free Up
Date, Sellers shall have no restriction under this Agreement on
the transferability of the ICG Shares.
SECTION 6.9 Restriction of Sellers' Activities. No Seller
----------------------------------
nor any Affiliate or Associate of a Seller will, from the date of
this Agreement until the Free Up Date, engage in the purchase or
sale of, or any other transaction relating to, the common stock
or other securities of Buyer or Buyer's Affiliates; provided that
any such Person shall be permitted to purchase such common stock
or other securities if such purchase is not associated with any
other transaction intended to mitigate such Person's risk of loss
on any other common stock or other securities of Buyer or Buyer's
Affiliates. For purposes of this Agreement, the term Associate
means with respect to any Person, (i) an "associate" of such
person within the meaning of Rule 12(b)-2 under the Securities
Exchange Act of 1934, as amended; and (ii) in the case of a
Person who is a human being, any other human being related to
such Person by consanguinity within the third degree or in a step
or adoptive relationship within such third degree.
ARTICLE VII
CONDITIONS TO CLOSING
SECTION 7.1 Conditions to Obligation of Buyer. The
---------------------------------
obligation of Buyer to consummate the transactions contemplated
by this Agreement is subject to satisfaction of the following
conditions:
(a) each Seller's representations and warranties shall be
correct and complete at and as of the Closing Date and the
Closing and any written notices delivered to Buyer pursuant to
Section 5.4 and the subject matter thereof shall be satisfactory
to Buyer;
(b) Sellers shall have performed and complied with all of
their covenants hereunder required to be performed or complied
with through the Closing;
(c) Sellers shall have given, or shall have caused the
Company to give, all notices and procured, or shall have caused
the Company to procure, all of the third-party consents,
-23-
authorizations and approvals (including all consents,
authorizations and approvals by Governmental Authorities)
required to consummate the transactions contemplated by this
Agreement, all in form and substance reasonably satisfactory to
Buyer;
(d) no action, suit or proceeding shall be pending or
threatened before any Governmental Authority or any other Person
wherein an unfavorable Order would (i) prevent consummation of
any of the transactions contemplated by this Agreement (ii) cause
any of the transactions contemplated by this Agreement to be
rescinded following consummation or (iii) affect adversely the
right of Buyer to own all of the Interests of the Company or
conduct the business of the Company, and no such Order shall be
in effect.
(e) there shall have occurred no event, fact or
circumstance that has had or could reasonably be expected to have
(i) a Material Adverse Effect or (ii) an adverse effect on
Buyer's right to own the Interests free of Encumbrances and
Taxes, or to conduct the Company's business substantially as such
businesses were being conducted on March 31, 1998;
(f) Sellers shall have delivered to Buyer (i) a certificate
to the effect that each of the conditions specified above in
Sections 6.1(a) through (e) is satisfied in all respects, and
(ii) good standing certificates, dated within ten days of the
Closing, from the Secretaries of State of the States of Nevada
and Colorado;
(g) the Other Seller Agreements shall have been executed
and delivered by Sellers or other relevant Persons, as
applicable;
(h) Buyer shall have received the resignations, effective
as of the Closing, as requested in writing by Buyer, of each
manager and other officer of the Company;
(i) Upon the written request of Buyer to Seller, Buyer
shall have received from counsel to Seller an opinion in form and
substance reasonably satisfactory to Buyer;
(j) assignments of the Interests in form and substance
satisfactory to Buyer shall have been delivered by Sellers to
Buyer;
(k) Sellers shall have satisfied, in form and substance
satisfactory to Buyer, all liabilities to employees of the
Company with respect to any phantom stock or equity arrangements
relating to the Company, and any outstanding or alleged claim
described in Section 5.7;
(l) Sellers shall have delivered to Buyer evidence,
satisfactory to Buyer, of the termination of all indemnification
agreements between the Company and any Seller;
(m) Sellers have executed (i) an agreement waiving their
rights of first refusal under the Company's operating agreement
-24-
and (ii) an amendment of the Company's operating agreement
amending the dissolution provisions of such agreement, each in
form and substance satisfactory to Buyer;
(n) The note payable by the Company to Xxxxx shall have
been canceled contemporaneously with the Closing;
(o) Sellers shall have delivered, or caused the Company to
deliver, to Buyer such other instruments, certificates and
documents as are reasonably requested by Buyer in order to
consummate the transactions contemplated by this Agreement, all
in form and substance reasonably satisfactory to Buyer;
(p) Buyer shall have obtained the consent or waiver of
CSW/ICG ChoiceCom, L.P., C3 Communications, Inc., and Central and
Southwest Corporation of their rights with respect to a portion
of the Company's business to be acquired at Closing;
(q) Sellers shall have delivered, or caused the Company to
deliver, to Buyer UCC termination Statements with respect to UCC-
1 financing statements filed by the Company as Debtor and
National Factoring Services, Inc. as secured party filed (i) on
May 14, 1997 as File No. 9708298 in the office of the Secretary
of State of Nevada and (ii) on May 6, 1997 as File No.
19972036585 in the office of the Secretary of State of Colorado;
and
(r) Sellers shall have delivered, or caused the Company to
deliver, to Buyer written termination of the Master Agreement for
Purchase and Assignment of Accounts Receivable dated April 29,
1997, between National Factoring Services, Inc. and the Company,
the Disbursement Agreement dated May 15, 1997 between the
Company, BellSouth Long Distance, Inc. and National Factoring
Services, Inc., and any related agreements.
Buyer in its sole discretion may waive any condition specified in
this Section 7.1 at or prior to the Closing.
SECTION 7.2 Conditions to Obligation of Sellers. The
-----------------------------------
obligation of Sellers to consummate the transactions contemplated
by this Agreement is subject to satisfaction of the following
conditions:
(a) Buyer's representations and warranties shall be correct
and complete at and as of the Closing Date and the Closing;
(b) Buyer shall have performed and complied with all of its
covenants hereunder required to be performed or complied with
through the Closing Date;
(c) no action, suit or proceeding shall be pending or
threatened before any Governmental Authority or any other Person
wherein an unfavorable Order would (i) prevent consummation of
any of the transactions contemplated by this Agreement or
(ii) cause any of the transactions contemplated by this Agreement
to be rescinded following consummation.
-25-
(d) Buyer shall have delivered to Sellers a certificate to
the effect that each of the conditions specified above in
Sections 7.2(a) through (c) is satisfied in all respects;
(e) the Other Buyer Agreements shall have been executed and
delivered by Buyer;
(f) Buyer shall have paid and deposited the purchase price
for the Interests pursuant to Section 2.2; and
(g) ICG shall have caused the ICG shares to be listed for
trading on the Nasdaq Market.
Sellers in their sole discretion may waive any condition
specified in this Section 7.2 at or prior to the Closing.
ARTICLE VIII
REMEDIES FOR BREACHES OF THIS AGREEMENT
SECTION 8.1 Indemnification Provisions for Benefit of Buyer
-----------------------------------------------
and the Company.
---------------
(a) If any Seller breaches (or if any Person other than
Buyer alleges facts that, if true, would mean any Seller has
breached) (i) any of the representations or warranties of any
Seller contained herein and Buyer gives notice thereof to
Sellers' Agent within the applicable Survival Period, or (ii) any
covenants or agreements of any Seller contained herein or any
agreements, representations, warranties or covenants of any
Seller contained in any Other Seller Agreement and Buyer gives
notice thereof to Sellers' Agent, then, subject to Section 8.6,
Xxxxx and the Trust jointly and severally, and the Minority
Members severally, will indemnify and hold harmless Buyer and the
Company from and against any Adverse Consequences Buyer or the
Company may suffer resulting from, arising out of, relating to or
caused by any of the foregoing regardless of whether the Adverse
Consequences are suffered during or after any applicable Survival
Period; provided, however, that the maximum amount with respect
to which any Minority Seller shall be required to indemnify Buyer
under this Article VIII shall not exceed an amount equal to the
product of (i) the amount of such Adverse Consequences suffered
by Buyer multiplied by (ii) a fraction, the numerator of which is
the Interests owned by such Minority Seller as reflected on
SCHEDULE 3.3 and the denominator of which is 27.38. In
------------
determining solely the amount of Adverse Consequences suffered by
Buyer or the Company for purposes of this Section 8.1, the
representations and warranties of Sellers will not be qualified
by "material," "materiality," "in all material respects," "best
knowledge," "best of knowledge" or "knowledge" or words of
similar import, or by any phrase using any such terms or words.
If any dispute arises concerning whether any indemnification is
owing which cannot be resolved by negotiation among the parties
within 30 days of notice of claim for indemnification from the
party claiming indemnification to the party against whom such
claim is asserted, the dispute will be resolved by arbitration
pursuant to this Agreement.
-26-
(b) Amounts needed to cover any indemnification claims
resolved in favor of Buyer or the Company against any Seller
during the Escrow Period will be paid to Buyer out of the ICG
Shares escrowed pursuant to the Escrow Agreement, to the extent
thereof. For purposes of calculating the number of ICG Shares to
be paid to Buyer to cover such indemnification claims, in each
case the per share value of each ICG Share will be the volume
weighted average price of the ICG Common Stock quoted on the
Nasdaq Market for the five trading days ending two trading days
prior to the date of expiration of the Reply Period or receipt of
the Reply Notice, whichever is applicable. Xxxxx and the Trust
will have joint and several Liability, and the Minority Members
will be severally liable, pro rata according to their Interests,
for any additional amounts needed to cover such claims, which
amounts will be paid directly to Buyer. At the end of the Escrow
Period ICG Shares (valued as provided in this Section 8.1(b) as
of the last Business Day falling within the Escrow Period) that
may be needed to cover pending indemnification claims made by
Buyer (such amounts to be determined by Buyer based upon the
reasonable exercise of its business judgment) will be retained in
the Escrow Account until such claims are resolved, and any excess
of such retained ICG Shares on deposit in the Escrow Account will
be distributed to Sellers upon the resolution of all such pending
indemnification claims. Nothing in this Section 8.1(b) will be
construed to limit Buyer's right to indemnification to the ICG
Shares on deposit in the Escrow Account. Buyer and Sellers'
Agent shall jointly give instructions to the Escrow Agent to
carry out the intent of this Section 8.1(b). Any disputes
concerning the escrowed property will be settled by arbitration
as provided in this Agreement. Buyer will be responsible for the
fees, charges and expenses payable to the Escrow Agent pursuant
to Section 5(d) of the Escrow Agreement.
SECTION 8.2 Indemnification Provisions for Benefit of
-----------------------------------------
Sellers.
-------
If (a) Buyer breaches (or if any Person other than a Seller
alleges facts that, if true, would mean Buyer has breached) any
of its representations or warranties contained herein, and
Seller's Agent gives notice of a claim for indemnification
against Buyer within the applicable Survival Period, or (b) Buyer
breaches (or if any Person other than a Seller alleges facts
that, if true, would mean Buyer has breached) any of its
covenants or agreements contained herein or any of its
agreements, representations, warranties or covenants contained in
any Other Buyer Agreement and Seller's Agent gives notice thereof
to Buyer, then Buyer will indemnify and hold harmless Sellers
from and against any Adverse Consequences Sellers may suffer
which result from, arise out of, relate to, or are caused by the
breach or alleged breach, regardless of whether the Adverse
Consequences are suffered during or after the applicable Survival
Period. In determining solely the amount of Adverse Consequences
suffered by Sellers for purposes of this Section 8.2, the
representations and warranties of Buyer shall not be qualified by
"material," "materiality," "in all material respects," "best
knowledge," "best of knowledge" or "knowledge" or words of
similar import, or by any phrase using any such terms or words.
If any dispute arises concerning whether any indemnification is
owing which cannot be resolved by negotiation among the parties
within 30 days of notice of claim for indemnification from the
party claiming indemnification to the party against whom such
claim is asserted, the dispute will be resolved by arbitration
pursuant to this Agreement.
-27-
SECTION 8.3 Matters Involving Third Parties.
-------------------------------
(a) If any Person not a party to this Agreement (including,
without limitation, any Governmental Authority) notifies any
party (the "Indemnified Party") with respect to any matter (a
"Third Party Claim") which may give rise to a claim for
indemnification against any other party (the "Indemnifying
Party"), then the Indemnified Party will notify each Indemnifying
Party thereof in writing within 15 days after receiving such
notice. No delay on the part of the Indemnified Party in
notifying any Indemnifying Party will relieve the Indemnifying
Party from any obligation hereunder unless (and then solely to
the extent) the Indemnifying Party thereby is prejudiced by such
delay.
(b) Any Indemnifying Party will have the right, at its sole
cost and expense, to defend the Indemnified Party against the
Third Party Claim with counsel of its choice satisfactory to the
Indemnified Party so long as (i) the Indemnifying Party notifies
the Indemnified Party in writing within 10 days after the
Indemnified Party has given notice of the Third Party Claim that
the Indemnifying Party will indemnify the Indemnified Party from
and against the entirety of any Adverse Consequences the
Indemnified Party may suffer resulting from, arising out of,
relating to or caused by the Third Party Claim, (ii) the
Indemnifying Party provides the Indemnified Party with evidence
reasonably acceptable to the Indemnified Party that the
Indemnifying Party will have the financial resources to defend
against the Third Party Claim and fulfill its indemnification
obligations hereunder, (iii) the Third Party Claim involves only
money damages and does not seek an injunction or other equitable
relief, (iv) settlement of, or an adverse judgment with respect
to, the Third Party Claim is not, in the good faith judgment of
the Indemnified Party, likely to establish a precedential custom
or practice materially adverse to the continuing business
interests of the Indemnified Party, and (v) the Indemnifying
Party conducts the defense of the Third Party Claim actively and
diligently. If the Indemnifying Party does not assume control of
the defense or settlement of any Third Party Claim in the manner
described above, it will be bound by the results obtained by the
Indemnified Party with respect to the Third Party Claim. In the
event the Third Party Claim does seek an injunction or other
equitable relief, this Section 8.3(b) will not apply.
(c) So long as the Indemnifying Party is conducting the
defense of the Third Party Claim in accordance with
Section 8.3(b) above, (i) the Indemnified Party may retain
separate co-counsel at its sole cost and expense and participate
in the defense of the Third Party Claim, (ii) the Indemnified
Party will not consent to the entry of any judgment or enter into
any settlement with respect to the Third Party Claim without
obtaining (A) an entry of dismissal, with prejudice, or an entry
of dismissal, without prejudice and a covenant not to xxx (if
legal action is instituted), (B) the full and unconditional
release of the Indemnifying Party from all liability in respect
of such Third Party Claim and (C) the prior written consent of
the Indemnifying Party (not to be withheld unreasonably), and
(iii) the Indemnifying Party will not consent to the entry of any
judgment or enter into any settlement with respect to the Third
Party Claim without obtaining (A) an entry of dismissal, with
prejudice, or an entry of dismissal, without prejudice and a
covenant not to xxx (if legal action is instituted), (B) the full
-28-
and unconditional release of the Indemnified Party from all
liability in respect of such Third Party Claim and (C) the prior
written consent of the Indemnified Party (not to be withheld
unreasonably).
(d) In the event any of the conditions in Section 8.3(b) is
or becomes unsatisfied, or if Section 8.3(b) does not apply,
(i) the Indemnified Party may defend against, and consent to the
entry of any judgment or enter into any settlement with respect
to, the Third Party Claim in any manner it reasonably may deem
appropriate (and the Indemnified Party need not consult with, or
obtain any consent from, any Indemnifying Party in connection
therewith), (ii) the Indemnifying Party will reimburse the
Indemnified Party promptly and periodically for the costs of
defending against the Third Party Claim (including reasonable
attorneys' fees and expenses), and (iii) the Indemnifying Party
will remain responsible for any Adverse Consequences the
Indemnified Party may suffer resulting from, arising out of,
relating to or caused by the Third Party Claim to the fullest
extent provided in this Article VIII.
SECTION 8.4 Survival. The representations and warranties
--------
made in this Agreement or in any other agreement referred to in
this Agreement, or in any certificate or other document delivered
pursuant to this Agreement or in connection with this Agreement
will survive the Closing Date for a period of two years from the
Closing Date, except that (a) the representations and warranties
of Sellers in Sections 3.1, 3.3 and 3.4, and of Buyer in Sections
4.1 and 4.2, will survive forever and (b) the representations and
warranties of Sellers in Sections 3.8, 3.15, and 3.18 will
survive until the expiration of all applicable statutes of
limitations with respect to any such claims that could be brought
regarding such matters (including any extensions of any statutes
of limitations), plus a period of 60 days. No party will have
any obligation to indemnify any person pursuant to this Agreement
with respect to any breach of a representation or warranty unless
a specific claim has been validly made under this Agreement on or
prior to the expiration of the applicable period set forth above.
The covenants and agreements of Sellers and Buyer made in this
Agreement will survive the Closing Date indefinitely.
SECTION 8.5 Limitations.
-----------
(a) The indemnification provisions of this Article will
constitute the exclusive remedy by either party against the other
arising by virtue of a breach of any agreement, representation,
warranty, or covenant under this Agreement, absent fraud.
(b) The Company will not have any duty to indemnify any
Seller or contribute funds for the benefit of any Seller. Each
Seller waives any right to indemnification or contribution from
the Company.
SECTION 8.6 Basket and Ceiling.
------------------
(a) Except as provided in the last sentence of this Section
8.6(a) and in Section 8.6(c), Buyer (and the Company, as
applicable) will not be entitled to indemnification from Sellers
under Section 8.1 or Section 8.3 unless and until, and then
solely to the extent that, the aggregate amount of Adverse
Consequences with respect to which Buyer or the Company would
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otherwise be entitled to assert under Section 8.1 or Section 8.3,
whichever is applicable, exceeds $50,000 (the "Basket Amount").
When the aggregate amount of such Adverse Consequences exceeds
the Basket Amount, Buyer (and the Company, as applicable) will be
entitled to indemnification under Section 8.1 or Section 8.3, as
applicable, for all Adverse Consequences in excess of the Basket
Amount.
(b) Sellers will be required to indemnify Buyer under this
Article VIII for all Adverse Consequences suffered as a result of
the breach of any of the representations, warranties or covenants
set forth in Article III or elsewhere in this Agreement, other
than the representations, warranties and covenants set forth in
Sections 3.1, 3.3, 3.4, 3.8, 3.15 and 3.18, only in an amount, in
the aggregate for all or any of such breaches, not in excess of
$1,500,000.
(c) Except as provided in the second sentence of this
Section 8.6(c), Sellers will be required to indemnify Buyer
without limitation under this Article VIII for all Adverse
Consequences suffered as a result of one or more breaches of the
representations and warranties set forth in Sections 3.1, 3.3,
3.4, 3.8, 3.15 and 3.18, and there shall be no monetary
limitation on the amount of such indemnification payable by
Sellers nor shall Section 8.6(a) (relating to the Basket Amount)
apply to such breaches. Buyer agrees, however, that the
aggregate amount of such indemnification shall in no event exceed
the amount of the Purchase Price payable by Buyer to Sellers
under this Agreement in consideration of the Interests.
ARTICLE IX
TERMINATION
SECTION 9.1 Termination of Agreement. The parties may
------------------------
terminate this Agreement as provided below:
(a) Buyer and Sellers' Agent may terminate this Agreement
by mutual written consent at any time prior to the Closing;
(b) Buyer may terminate this Agreement by giving written
notice to Sellers' Agent at any time prior to the Closing (i) in
the event any Seller has materially breached any agreement,
representation, warranty or covenant contained in this Agreement,
Buyer has notified Sellers' Agent of the breach, and the breach
has not been cured within 10 days after the notice of breach; or
(ii) if the Closing has not occurred on or before the date that
is 60 days after the date of this Agreement because of the
failure of any condition precedent to Buyer's obligations to
consummate the Closing (unless the failure results primarily from
Buyer breaching any agreement, representation, warranty or
covenant contained in this Agreement in any material way);
(c) Sellers may terminate this Agreement by Seller's Agent
giving written notice to Buyer at any time prior to the Closing
(i) if Buyer has breached any agreement, representation, warranty
or covenant contained in this Agreement, Sellers' Agent has
notified Buyer of the breach, and the breach has not been cured
-30-
within 10 days after the notice of breach, or (ii) if the Closing
has not occurred on or before the date that is 60 days after the
date of this Agreement because of the failure of any condition
precedent to Sellers' obligations to consummate the Closing
(unless the failure results primarily from any Seller breaching
any agreement, representation, warranty or covenant contained in
this Agreement in any material way), or (iii) if the Closing has
not occurred on or before the date that is 60 days after the date
of this Agreement because of the failure of the condition
precedent to Buyer's obligations to consummate the Closing set
forth in Section 7.1(p).
SECTION 9.2 Effect of Termination. The termination of this
---------------------
Agreement by a party pursuant to Section 9.1 will in no way limit
any obligation or liability of any other party based on or
arising from a breach or default by such other party with respect
to any of its agreements, representations, warranties or
covenants contained in this Agreement, and the terminating party
will be entitled to seek all relief to which it is entitled under
applicable law. The obligations of Sellers set forth in Section
5.5 will survive the termination of this Agreement.
SECTION 9.3 Confidentiality. If this Agreement is
---------------
terminated, each party will treat and hold as confidential all
Confidential Information concerning the other parties which it
acquired from such other parties in connection with this
Agreement and the transactions contemplated hereby, and upon the
request of Buyer or Sellers' Agent, as applicable, Buyer and
Sellers will return to the other all such Confidential
Information within its possession.
ARTICLE X
MISCELLANEOUS
SECTION 10.1 No Third-Party Beneficiaries. This Agreement
----------------------------
will not confer any rights or remedies upon any Person other than
the parties and their respective successors and permitted
assigns.
SECTION 10.2 Entire Agreement. This Agreement (including
----------------
the EXHIBITS, SCHEDULES and documents referred to herein)
-------------------
constitutes the entire agreement among the parties and supersedes
any prior understandings, agreements or representations by or
among the parties, written or oral, and the letter agreement
dated April 20, 1998 between Xxxxx on behalf of Sellers and the
Company, on the one hand, and Buyer, on the other, to the extent
they relate in any way to the subject matter hereof.
SECTION 10.3 Succession and Assignment. This Agreement
-------------------------
will be binding upon and inure to the benefit of the parties and
their respective successors and permitted assigns. Neither
Seller nor Buyer may assign this Agreement or any of his or her
rights, interests or obligations hereunder without the prior
written approval of the other.
SECTION 10.4 Counterparts. This Agreement may be executed
------------
in any number of counterparts, each of which shall be deemed an
original and all of which together shall be deemed to be one and
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the same instrument. The execution of a counterpart of the
signature page to this Agreement will be deemed the execution of
a counterpart of this Agreement. The delivery of this Agreement
may be made by facsimile, and facsimile signatures shall be
treated as original signatures for all applicable purposes.
SECTION 10.5 Headings, Terms. The section headings
---------------
contained in this Agreement are inserted for convenience only and
will not affect in any way the meaning or interpretation of this
Agreement. Terms used with initial capital letters will have the
meanings specified, applicable to both singular and plural forms,
for all purposes of this Agreement. All pronouns (and any
variation) will be deemed to refer to the masculine, feminine or
neuter, as the identity of the Person may require. The singular
or plural includes the other, as the context requires or permits.
The word include (and any variation) is used in an illustrative
sense rather than a limiting sense. The word day means a
calendar day.
SECTION 10.6 Notices. All notices, requests, demands,
-------
claims, and other communications hereunder will be in writing.
Any notice, request, demand, claim, or other communication
hereunder shall be deemed duly given if it is sent by registered
or certified mail, return receipt requested, postage prepaid, or
by courier, telecopy or facsimile, and addressed to the intended
recipient as set forth below:
If to
Sellers: Copy to:
Addressed to the Olona & Associates, P.C.
Sellers' Agent at: Attention: Xxxxxxx X. Xxxxx, Esq.
G. Xxxxxx Xxxxx 000 Xxxxxxxxxxx Xxxxxx, Xxxxx 0000
0000 Xxxxx Xxxx Xxxxxx Xxxxxx, Xxxxxxxx 00000
Xxxxxxxxx, Xxxxxxxx 00000 Telecopy: (000) 000-0000
Telecopy: (000) 000-0000
If to Buyer: Copy to:
ICG Telecom Group, Inc. Xxxxxxx & Xxxxxx L.L.C.
000 Xxxxxxxxx Xxxxx Xxxx 000 Xxxxxxxxxxx Xx., Xxxxx 0000
Xxxxxxxxx, Xxxxxxxx 00000 Xxxxxx, Xxxxxxxx 00000
Attn: H. Xxx Xxxxxx, Esq. Attn: Xxxxxx Xxxxx, Esq.
Executive Vice President, Telecopy: (000) 000-0000
General Counsel and Secretary
Telecopy: (000) 000-0000
Notices will be deemed given seven days after mailing if sent by
certified mail, when delivered if sent by courier, and upon
receipt of confirmation by person or machine if sent by telecopy
or facsimile transmission. Any party may change the address to
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which notices, requests, demands, claims and other communications
hereunder are to be delivered by giving the other parties notice
in the manner herein set forth.
SECTION 10.7 GOVERNING LAW. THIS AGREEMENT WILL BE
-------------
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE DOMESTIC LAWS OF
THE STATE OF COLORADO WITHOUT GIVING EFFECT TO ANY CHOICE OR
CONFLICT OF LAW PROVISION OR RULE (WHETHER OF THE STATE OF
COLORADO OR ANY OTHER JURISDICTION) THAT WOULD CAUSE THE
APPLICATION OF THE LAWS OF ANY JURISDICTION OTHER THAN THE STATE
OF COLORADO.
SECTION 10.8 Amendments and Waivers. No amendment of any
----------------------
provision of this Agreement shall be valid unless the same is in
writing and signed by Buyer and Sellers' Agent. No waiver by any
party of any default, misrepresentation or breach of warranty or
covenant hereunder, whether intentional or not, will be deemed to
extend to any prior or subsequent default, misrepresentation or
breach of warranty or covenant hereunder or affect in any way any
rights arising by virtue of any prior or subsequent such
occurrence, and no waiver will be effective unless set forth in
writing and signed by the party against whom such waiver is
asserted.
SECTION 10.9 Severability. Any term or provision of this
------------
Agreement that is invalid or unenforceable in any situation in
any jurisdiction shall not affect the validity or enforceability
of the remaining terms and provisions hereof or the validity or
enforceability of the offending term or provision in any other
situation or in any other jurisdiction.
SECTION 10.10 Expenses. Except as otherwise provided in
--------
Section 9.2, (a) Buyer shall bear its own costs and expenses
(including, without limitation, legal fees and expenses) incurred
either before or after the date of this Agreement in connection
with this Agreement or the transactions contemplated hereby, and
all filing fees payable to any Governmental Authority in
connection with the transaction, and upon receipt of evidence,
reasonably satisfactory to Buyer, of liability therefor or
payment thereof, Buyer shall reimburse Sellers, pay, or bear
liability for, as the case may be, all Seller Transaction
Expenses not to exceed $10,000 in the aggregate; and (b) Sellers
will bear all costs and expenses (including, without limitation,
all legal, accounting and tax related fees and expenses, all
fees, commissions, expenses and other amounts payable to any
broker, finder or agent) incurred by the Company prior to the
Closing or by any Seller either before or after the date of this
Agreement in connection with this Agreement or the transactions
contemplated hereby (collectively, "Seller Transaction
Expenses"); provided that Sellers shall pay or have liability for
Seller Transaction Expenses only to the extent such Seller
Transaction Expenses exceed $10,000 in the aggregate. Any Seller
Transaction Expenses payable by Sellers under this Agreement
relating to amounts incurred by the Company prior to the Closing
shall be reimbursed in cash by Sellers to the Company.
SECTION 10.11 Arbitration. Any disputes arising under or
-----------
in connection with this Agreement, including, without limitation,
those involving claims for specific performance or other
equitable relief, will be submitted to binding arbitration under
the Commercial Arbitration Rules of the American Arbitration
Association under the authority of federal and state arbitration
-33-
statutes, and shall not be the subject of litigation in any
forum. EACH PARTY, BY SIGNING THIS AGREEMENT, VOLUNTARILY,
KNOWINGLY AND INTELLIGENTLY WAIVES ANY RIGHTS SUCH PARTY MAY
OTHERWISE HAVE TO SEEK REMEDIES IN COURT OR OTHER FORUMS,
INCLUDING THE RIGHT TO JURY TRIAL. The arbitration will be
conducted only in Denver, Colorado, before a single arbitrator
selected by the parties or, if they are unable to agree on an
arbitrator, before a panel of three arbitrators, one selected by
Buyer, one selected by Sellers' Agent and the third selected by
the other two arbitrators. The arbitrators shall have full
authority to order specific performance and award damages and
other relief available under this Agreement or applicable law,
but shall have no authority to add to, detract from, change or
amend the terms of this Agreement or existing law. All
arbitration proceedings, including settlements and awards, shall
be confidential. The decision of the arbitrators will be final
and binding, and judgment on the award by the arbitrators may be
entered in any court of competent jurisdiction. THIS SUBMISSION
AND AGREEMENT TO ARBITRATE WILL BE SPECIFICALLY ENFORCEABLE. The
arbitrator will have no power to award punitive or exemplary
damages, to ignore or vary the terms of this Agreement or any
Other Buyer Agreement or Other Seller Agreement, and will be
bound to apply controlling law. The party who prevails on entry
of the award of judgment will be entitled to his or its costs and
expenses, including reasonable attorney's fees incurred in
connection with the arbitration. A judgment upon the award may
be entered in any court having jurisdiction.
SECTION 10.12 Construction. The parties have participated
------------
jointly in the negotiation and drafting of this Agreement. In
the event an ambiguity or question of intent or interpretation
arises, this Agreement will be construed as if drafted jointly by
the parties and no presumption or burden of proof will arise
favoring or disfavoring any party by virtue of the authorship of
any of the provisions of this Agreement. The parties intend that
each representation, warranty and covenant contained herein will
have independent significance. If any party breaches any
representation, warranty or covenant contained herein in any
respect, the fact that there exists another representation,
warranty or covenant relating to the same subject matter
(regardless of the relative levels of specificity) which the
party has not breached will not detract from or mitigate the fact
that the party is in breach of the first representation, warranty
or covenant.
SECTION 10.13 Incorporation of Exhibits. The EXHIBITS and
------------------------- --------
SCHEDULES identified in this Agreement are incorporated herein by
---------
reference and made a part hereof.
SECTION 10.14 Representations as to Knowledge. The
-------------------------------
representations and warranties contained in Article III of this
Agreement will, in each and every case where a statement to the
"knowledge" is required on behalf of any party to this Agreement,
or where something is "known" by a party, be deemed to require
that such statement be in good faith after reasonable
investigation (including, in the case of Sellers, inquiry of the
applicable employees of the Company), with due diligence, in the
best efforts of such party. Any reference to the "knowledge" of,
or "known" by, Sellers shall refer to the knowledge of each of
Sellers individually.
-34-
SECTION 10.15 Sellers' Agent. Each Seller hereby
--------------
authorizes and appoints Sellers' Agent as its, his or her
exclusive agent and attorney-in-fact to act on behalf of each of
them with respect to all matters which are the subject of this
Agreement, including, without limitation, (a) receiving or giving
all notices, instructions, other communications, consents or
agreements that may be necessary, required or given hereunder and
(b) asserting, settling, compromising, or defending, or
determining not to assert, settle, compromise or defend, (i) any
claims which any Seller may assert, or have the right to assert,
against Buyer, or (ii) any claims which Buyer may assert, or have
the right to assert, against any Seller. Sellers' Agent hereby
accepts such authorization and appointment. Upon the receipt of
written evidence satisfactory to Buyer to the effect that
Sellers' Agent has been substituted as agent of Sellers by reason
of his death, disability or resignation, Buyer shall be entitled
to rely on such substituted agent to the same extent as it was
theretofore entitled to rely upon Sellers' Agent with respect to
the matters covered by this Section 10.15. No Seller shall act
with respect to any of the matters which are the subject of this
Agreement except through Sellers' Agent. Sellers acknowledge and
agree that Buyer may deal exclusively with Sellers' Agent in
respect of such matters, that the enforceability of this
Section 10.15 is material to Buyer, and that Buyer has relied
upon the enforceability of this Section 10.15 in entering into
this Agreement. In the event Sellers' Agent declines to represent
Sellers with respect to any matter delegated to Sellers' Agent
under this Agreement, Sellers agree that the affirmative written
determination of those Sellers holding more than 50 percent of
the number of Interests held by all of Sellers, as set forth on
SCHEDULE 3.3, will constitute the action of all of Sellers, and
------------
each Seller agrees that in such event it will be bound by the
determination of such majority of Sellers and will not seek to
challenge any such determination in any forum.
[SIGNATURE PAGE FOLLOWS.]
-35-
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the date first above written.
BUYER:
ICG D.C. HOLDINGS, INC.
By:
Name:
Title:
SELLERS:
X. Xxxxxx Xxxxx
X. Xxxxxx Xxxxx Trust u/a/d 1/14/93
By: G. Xxxxxx Xxxxx, Trustee
Xxxxxxx X. X. Fought
Xxxxxx X. Xxxx Daughters Trust
By: Xxxxxx X. Xxxxx, Trustee
By: G. Xxxxxx Xxxxx, Attorney-in-Fact
T & D Consulting, Inc.
By:
Name: Xxxxxx Xxxxxxx
Title:
By:
Name: Xxxxx Xxxxxxx
Title:
[SIGNATURE PAGE TO PURCHASE AGREEMENT]
SCHEDULE 3.10(b)
----------------
LIST OF PROPERTIES, CONTRACTS AND OTHER DATA
1. All items of equipment, machinery and other tangible
personal property of the Company (including that which, as of the
date of this Agreement, has no book value), and the original
cost, depreciation and current book value of all such items which
are included in the Latest Balance Sheet.
2. All guaranty, warranty and indemnity agreements with
respect to products or services provided or delivered by the
Company.
3. All contracts or agreements for the purchase, sale,
rental, rental/purchase or sale, lease or lease/purchase or sale
or similar arrangement of materials, supplies, products or other
personal property or the furnishing or receipt of services by the
Company.
4. All claims, deposits, causes of action, choses in
action, rights of recovery, rights of setoff and rights of
recoupment of the Company.
5. All franchises, approvals, Permits, licenses, Orders,
registrations, certificates, variances and similar rights of the
Company.
6. All other contracts, agreements, instruments,
guarantees and commitments (including confidentiality and
noncompetition agreements, mortgages, deeds of trust, indentures,
loan agreements and credit agreements) to which the Company is a
party or by which assets are bound.
7. The names and annual rates of compensation as of March
31, 1998 (which rates have remained the same through the date of
this Agreement) of all employees of the Company.
8. All notes or accounts receivable relating to accounts
with the Company, or advances by the Company, to any Seller,
officer, director, employee or consultant of the Company, and all
contracts or agreements for the purchase or lease of materials,
supplies, products or other personal property or for the
furnishing or receipt of services which are with any Seller,
officer, director, employee or consultant of the Company.
9. Each item of Intellectual Property owned by the Company
or which is used by the Company in its business and, in each case
where the Company is not the owner, the owner of the Intellectual
Property.
10. The name of each bank or other financial institution or
entity in which the Company has an account or safe deposit box
(with the identifying account number or symbol) and the names of
all persons authorized to draw on such account or to have access
to such safe deposit box.
Schedule 3.10(b) - 1
