ASSET PURCHASE AGREEMENT
Exhibit
99.1
THIS
ASSET PURCHASE AGREEMENT (this
“Agreement”) is made and entered into as of July 31, 2007, by and between
RICOCHET NETWORKS, INC., a Delaware corporation (“Seller”), CIVITAS
WIRELESS SOLUTIONS, LLC, a Colorado limited liability company (“Buyer”),
and is joined in by XXXX X. XXXXX (“Buyer Member”).
RECITALS
A. Buyer
Member is the current President of Seller and desires to acquire the operating
business from Seller through Buyer (which is majority owned by Buyer
Member).
B. Subject
to the terms and conditions of this Agreement, Buyer desires to purchase and
assume, and Seller desires to sell and transfer, substantially all of the
current operating assets and liabilities of Seller.
C. Buyer
Member is joining in this Agreement for the purpose of accepting and agreeing
to
be bound by the terms hereof applicable to Buyer Member contained
herein.
NOW,
THEREFORE, in consideration of the
foregoing premises (which are recitals only and not part of the binding
Agreement), the mutual representations, covenants, and agreements hereinafter
set forth herein and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto, intending
to
be legally bound, agree as follows.
1. DEFINITIONS. As
used herein, the following terms have the following meanings. Other
capitalized terms used in this Agreement but not defined in this Section 1
shall
have the meanings given to them wherever such terms first appear in this
Agreement.
(a) “Assets”
shall mean all of the assets of Seller (other than the Excluded Assets), each
to
the extent transferable.
(b) “Assumed
Contracts” shall mean all contracts, agreements, and other understandings of
Seller, verbal or written, to which Seller is a party or by which Seller is
bound or to which any of its assets or properties is subject that was entered
into or came into effect on or before the Closing (as defined below); provided,
however, the following shall not constitute or be a part of the Assumed
Contracts: (i) this Agreement; (ii) the Transaction Documents (as
defined below); and (iii) any contracts, agreements or other understandings
related to the Excluded Liabilities.
(c) “Assumed
Liabilities” shall mean all indebtedness, liabilities and obligations of
Seller (other than the Excluded Liabilities) of any nature, kind, character
or
description whatsoever, arising from or due to actions or omissions occurring
before or on the Closing, specifically including, without limitation, all
obligations and responsibilities arising from or due to the Assumed Contracts
(whether such obligations and responsibilities arise before or after the
Closing).
(d) “Xxxx
of Sale and Assignment and Assumption Agreement” shall mean the Xxxx of Sale
and Assignment and Assumption Agreement, in form and content substantially
similar to Exhibit 1(d) hereto, to be signed and delivered at the
Closing.
(e) INTENTIONALLY
OMITTED
(f) “Excluded
Assets” shall mean, and be limited to, the items listed on Schedule 1(f)
hereto.
(g) “Excluded
Liabilities” shall mean, and be limited to, the indebtedness, liabilities
and obligations of Seller listed on Schedule 1(g) hereto.
(h) “Knowledge
of Seller” shall mean, and be limited to, the actual knowledge of Xxxxxx X.
Xxxxxxxxxx and Xxxxx X. Xxxxxxx, but only to the extent that such persons have
knowledge that Xxxx Xxxxx does not have.
(i) “Other
IP Assets” shall mean the assets, ownership rights and licenses which are
owned by Terabeam and which are being licensed or conveyed to Buyer at the
Closing pursuant to the IP Assignment or the License Agreement.
(i) “Terabeam”
shall mean Terabeam, Inc., a Delaware corporation which owns all of the
outstanding stock of Seller.
2. PURCHASE
OF ASSETS AND TRANSFER OF LIABILITIES.
(a) Upon
the terms and subject to the conditions of this Agreement, at the Closing,
Buyer
shall purchase and acquire, and Seller or Terabeam shall sell, assign, convey,
and transfer, the Assets and the Other IP Assets. Such purchase and
sale shall be evidenced by the Xxxx of Sale and Assignment and Assumption
Agreement, the IP Assignment and the License Agreement.
(b) Upon
the terms and subject to the conditions of this Agreement, Buyer, at and
following the Closing, shall assume, perform, pay, and be responsible for the
Assumed Liabilities. Buyer shall not assume or be responsible for the
Excluded Liabilities. Such assumption shall be evidenced by the Xxxx
of Sale and Assignment and Assumption Agreement. It is expressly the
intent of the parties that, from and after the Closing, Seller shall have no
liabilities or obligations whatsoever except for (i) the Excluded Liabilities,
(ii) liabilities and obligations arising under this Agreement and agreements
contemplated herein to which Seller is a party, and (iii) liabilities and
obligations created and undertaken by Seller after the Closing.
3. PURCHASE
PRICE AND ALLOCATION.
(a) In
addition to the assumption of the Assumed Liabilities, the consideration to
Seller for the transactions contemplated by this Agreement (the “Purchase
Price”) shall be (i) Two Hundred Thousand Dollars ($200,000); (ii) 300,000
membership units in Buyer (the
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“Units”),
which constitutes fifteen percent (15%) of the fully-diluted equity of Buyer
as
of the Closing; and (iii) the consideration described in Schedule
3(a).
(b) The
cash portion of the Purchase Price shall be paid as follows: at the
Closing, Buyer will pay Seller the sum of Two Hundred Thousand Dollars
($200,000) by certified check or wire transfer of immediately available
funds;
(c) On
the Closing and upon Seller’s execution of a counterpart signature page to the
Operating Agreement of Buyer in the form attached hereto as Exhibit 3(c)(i)
(the
“Operating Agreement”), Buyer shall deliver a membership certificate
evidencing 300,000 Units in Buyer to Seller. The parties shall
execute a side letter substantially in the form attached hereto as Exhibit
3(c)(ii) (the “Side Letter”) which shall grant to Seller (i)
anti-dilution protection for any subsequent equity (including securities
convertible into equity) offerings of Buyer for the first year following the
Closing in which (A) the gross proceeds received by Buyer are less than One
Million Dollars ($1,000,000) or (B) the gross proceeds received by Buyer equal
or exceed One Million Dollars ($1,000,000) in which case the anti-dilution
protection shall be limited to the impact of only the first One Million Dollars
($1,000,000) of the offering, and (ii) a right to participate pro rata in any
subsequent equity (including securities convertible into equity) offerings
of
Buyer after the Closing in excess of One Million Dollars ($1,000,000), subject
to standard exclusions in either case.
(d) Not
later than sixty (60) days after the Closing, Buyer shall prepare and deliver
to
Seller copies of Form 8594 and any required exhibits thereto (collectively,
the
“Asset Allocation Statement”) allocating the Purchase Price among the
Assets and the Other IP Assets in accordance with Section 1060 of the Internal
Revenue Code and the Treasury regulations thereunder. Seller shall
have a period of thirty (30) days after delivery of the Asset Allocation
Statement to present in writing to Buyer notice of any good faith objections
Seller may have to the allocations set forth therein (an “Allocation
Objection Notice”). Unless Seller objects within such thirty (30)
day period, the Asset Allocation Statement shall be binding on the
parties. If Seller shall raise any objections within such thirty (30)
day period, Buyer and Seller shall negotiate in good faith and use their
commercially reasonable efforts to resolve such dispute. If the
parties fail to agree within fifteen (15) days after the delivery of the
Allocation Objection Notice, then the parties shall submit the Asset Allocation
Statement and the Allocation Objection Notice to an independent accountant
mutually agreeable to the parties (the “Accountant”) for
resolution. The Accountant shall resolve the dispute by selecting the
proposed allocation submitted by either Buyer or Seller which in the sole
judgment of the Accountant most accurately allocates the Purchase Price among
the Assets and the Other IP Assets in accordance with their relative fair market
values, but not by choosing any other formulation. The Accountant
shall render such decision and report to Buyer and Seller in writing, specifying
the reason for its decision in reasonable detail, not later than thirty (30)
days after the item has been referred to the Accountant. The costs,
fees and expenses of the Accountant shall be borne equally by Buyer and
Seller. The Purchase Price shall be allocated in accordance with the
Asset Allocation Statement, as finally determined, and all income tax returns
and reports filed by Buyer and Seller shall be prepared consistently with such
allocation.
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4. CLOSING. Subject
to the conditions set forth in this Agreement, consummation (the
“Closing”) for the purchase of the Assets, the assumption of the Assumed
Liabilities, and the other transactions contemplated herein to take place at
the
Closing shall take place at the principal offices of Seller in Denver, Colorado,
on July 31, 2007, at 11:59 p.m. Mountain Time or at such other date and place
as
the parties hereto may mutually agree.
5. REPRESENTATIONS
AND WARRANTIES OF SELLER. Seller represents and warrants to Buyer
as follows:
(a) Due
Organization and Authority. Each of Seller and Terabeam is a
corporation duly incorporated, validly existing, and in good standing under
the
laws of the State of Delaware. Each of Seller and Terabeam has full
power and authority to execute and deliver, and to consummate all transactions
contemplated by, this Agreement and the other documents referred to herein
to be
delivered at the Closing as contemplated by this Agreement (the “Transaction
Documents”) to which Seller or Terabeam is a party.
(b) Due
Authorization and Enforceability. Each of Seller and Terabeam is
duly authorized to execute and deliver this Agreement and the Transaction
Documents to be executed and delivered by it before or at the
Closing. This Agreement and the Transaction Documents to be executed
and delivered by Seller and Terabeam, as the case may be, at the Closing have
or
shall have been duly and validly executed and delivered by Seller or Terabeam,
as the case may be, and constitute or shall constitute legal, valid, binding
obligations of Seller and Terabeam, enforceable against Seller and Terabeam,
as
the case may be, in accordance with their respective terms.
(c) No
Violation of Certificate. The execution, delivery and performance
of this Agreement and the Transaction Documents by Seller and Terabeam have
not
and will not constitute a violation or breach under (i) their respective
Certificate of Incorporation or By-Laws, or (ii) (A) any statute, rule,
regulation or order of any governmental agency or body or any court, domestic
or
foreign, (collectively, “Legal Requirements”) having jurisdiction over
Seller or any of its assets or properties, or (B) any agreement or instrument
to
which either is a party or by which either is bound or to which any of their
respective assets or properties is subject.
(d) Brokers. No
broker, finder, investment banker or financial advisor has been retained on
behalf of Seller or Terabeam in connection with the transactions contemplated
hereby.
(e) Assets. Seller
has good and marketable title to all of the Assets, free and clear of any liens
or encumbrances created by Seller or its affiliates except as contemplated
in
this Agreement and the Transaction Documents (provided, however, that this
representation does not cover any liens or encumbrances created by Buyer Member
or of which Buyer Member has actual knowledge prior to the
Closing).
(f) Liabilities. To
the Knowledge of Seller, there is no litigation or other legal proceedings
of
any type whatsoever pending against any of the Assets or Seller. To
the
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Knowledge
of Seller, Seller is, and has been, in compliance in all material respects
with
all Legal Requirements applicable to Seller.
(g) Disclosure. No
representation or warranty contained in this Section 5 or the accompany
schedules contains any untrue statement or omits to state a material fact
necessary to make any of them, in light of the circumstances in which it was
made, not misleading.
6. REPRESENTATIONS
AND WARRANTIES OF BUYER AND BUYER MEMBER. Buyer and Buyer Member
jointly and severally represent and warrant to Seller as follows:
(a) Due
Formation and Authority. Buyer is a limited liability company
duly formed, validly existing, and in good standing under the laws of the State
of Colorado and has full power and authority to execute and deliver, and to
consummate all transactions contemplated by, this Agreement. True,
correct and complete copies of the Articles of Organization and Operating
Agreement of Buyer in effect as of the date of this Agreement have been provided
to Seller. The Articles of Organization and Operating Agreement of
Buyer and the Side Letter are the only documents pursuant to which Buyer was
formed and the internal affairs of, management of, and ownership in Buyer are
controlled and governed.
(b) Buyer
Equity Interests. Schedule 6(b) sets forth (i) the authorized
equity (in all classes and forms) of Buyer; (ii) the types and quantities of
each type, class, or series of equity of Buyer issued and outstanding; (iii)
the
holders (by type and quantity) of all outstanding equity of Buyer; and (iv)
the
types and quantities of each type, class, or series of equity of Buyer issuable
and/or reserved for issuance pursuant to securities exercisable for, or
convertible into or exchangeable for any type of equity interest of
Buyer. All of the issued and outstanding equity of Buyer has been
duly authorized and was issued in compliance with applicable state and federal
securities law and any rights of third parties. Except as set forth
in the Operating Agreement or the Side Letter, no person or entity is entitled
to pre-emptive or similar statutory or contractual rights with respect to any
securities of Buyer. Except as described in the Operating Agreement,
there are no outstanding warrants, options, convertible securities, or other
rights, agreements, or arrangements of any character under which Buyer is or
may
be obligated to issue any equity securities of any kind and Buyer is not
currently in negotiations for the issuance of any equity securities of any
kind. Except as set forth in the Operating Agreement, there are no
voting agreements, buy-sell agreements, option or right of first purchase
agreements or other agreements of any kind among Buyer and any of the
securityholders of Buyer relating to any securities of Buyer held by
them.
(c) Due
Authorization and Enforceability. Buyer is duly authorized to
execute and deliver this Agreement and the Transaction Documents to be
executed and delivered by it before or at the Closing. This Agreement
and the Transaction Documents to be executed and delivered by Buyer or Buyer
Member, as the case may be, at the Closing have or shall have been duly and
validly executed and delivered by Buyer or Buyer Member, as the case may be,
and
constitute or shall constitute legal, valid, binding obligations of Buyer or
Buyer Member, as the case may be, enforceable against such parties in accordance
with their respective terms.
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(d) No
Violation of Constating Documents and Other Agreements. The
execution, delivery and performance of this Agreement and the Transaction
Documents by Buyer and Buyer Member thereto will not conflict with or result
in
a breach or violation of any of the terms and provisions of, or constitute
a
default under (i) Buyer’s Articles of Organization or Operating Agreement, or
(ii) (A) any Legal Requirements having jurisdiction over Buyer, Buyer Member,
or
any of their assets or properties, or (B) any agreement or instrument to which
Buyer or Buyer Member is a party or by which Buyer or Buyer Member is bound
or
to which any of their assets or properties is subject.
(e) Brokers. No
broker, finder, investment banker or financial advisor has been retained on
behalf of Buyer or Buyer Member in connection with the transactions contemplated
hereby.
(g) Inspections. Each
of Buyer and Buyer Member is an informed, sophisticated business entity capable
of understanding and evaluating the merits and risks of the business of
Seller. Each of Buyer and Buyer Member has engaged such experts,
counsel, consultants and advisors, has undertaken such independent
investigation, has made such independent evaluation and has been provided with
access to such documents and personnel of Seller, each as it has deemed
necessary or appropriate. Each of Buyer and Buyer Member acknowledges
that it is entering into this Agreement and the transactions contemplated hereby
based on its own independent investigation and the specific terms of this
Agreement, that neither Seller nor anyone on its behalf has made any
representation, express or implied, and neither Buyer nor Buyer Member is
relying on any representation, other than those expressly set forth in Section
5
of this Agreement. IT IS THEREFORE EXPRESSLY UNDERSTOOD AND AGREED
THAT BUYER ACCEPTS THE CONDITION OF THE ASSETS AND ASSUMED LIABILITIES “AS IS,
WHERE IS” WITHOUT ANY REPRESENTATION, WARRANTY OR GUARANTEES, EXPRESS OR
IMPLIED, AS TO MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE,
NON-INFRINGEMENT, OR OTHERWISE AS TO THE CONDITION, SIZE, EXTENT, QUANTITY,
TYPE
OR VALUE OF SUCH ITEMS, EXCEPT ONLY AS MAY BE OTHERWISE SPECIFICALLY PROVIDED
IN
SECTION 5 OF THIS AGREEMENT, AND SELLER HEREBY EXPRESSLY DISCLAIMS ANY AND
ALL
SUCH OTHER REPRESENTATIONS, WARRANTIES, AND GUARANTEES.
(h) Adequate
Capitalization. Buyer has sufficient assets and working capital
to operate the Assets and Assumed Liabilities as presently contemplated by
Buyer.
(j) Disclosure. No
representation or warranty contained in this Section 6 or the accompany
schedules contains any untrue statement or omits to state a material fact
necessary to make any of them, in light of the circumstances in which it was
made, not misleading.
7. CONDITIONS
PRECEDENT TO BUYER’S AND BUYER MEMBER’S OBLIGATIONS. The
obligations of Buyer and Buyer Member hereunder are subject to the satisfaction
of the following conditions on or before the date of the Closing, the compliance
with or occurrence of which may be waived, but only in writing, by
Buyer:
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(a) Representations
and Warranties True at the Closing. The representations and
warranties of Seller contained in this Agreement shall be true on and as of
the
date of the Closing with the same effect as if made on and as of such
date.
(b) Performance
of Agreement and Conditions. Seller shall have performed,
complied with and satisfied all agreements and conditions required by this
Agreement to be performed, complied with or satisfied by it prior to the
Closing.
(c) No
Injunction. On the date of the Closing, there shall be no
effective injunction, writ, preliminary or temporary restraining order or any
other order of any nature issued by a court or other governmental body or agency
directing that the transactions provided for herein, or any of them, not be
consummated as herein provided.
(d) Delivery
of Documents. Seller and its affiliates shall have delivered the
documents required to be delivered by such party in accordance with Section
9 of
this Agreement.
8. CONDITIONS
PRECEDENT TO SELLER’S OBLIGATIONS. The obligations of Seller
hereunder are subject to the satisfaction of the following conditions on or
before the date of the Closing, the compliance with or occurrence of which
may
be waived, but only in writing, by Seller:
(a) Representations
and Warranties True at the Closing. The representations and
warranties of Buyer and Buyer Member contained in this Agreement shall be true
on and as of the date of the Closing with the same effect as if made on and
as
of such date.
(b) Performance
of Agreement and Conditions. Buyer and Buyer Member shall have
performed, complied with and satisfied all agreements and conditions required
by
this Agreement to be performed, complied with or satisfied by them prior to
the
Closing.
(c) No
Injunction. On the date of the Closing, there shall be no
effective injunction, writ, preliminary or temporary restraining order or any
other order of any nature issued by a court or other governmental body or agency
directing that the transactions provided for herein, or any of them, not be
consummated as herein provided.
(d) Delivery
of Documents. Buyer shall have delivered the documents required
to be delivered by such party in accordance with Section 9
of this Agreement.
9. DOCUMENTS
AT THE CLOSING. At the Closing, the following documents shall be
executed and delivered by the designated parties:
(a) by
Buyer:
(i) this
Agreement;
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(ii) the
Xxxx of Sale and Assignment and Assumption Agreement;
(iii) Buyer’s
Articles of Organization, the Operating Agreement, and the Side
Letter;
(iv) an
intellectual property transfer and license agreement in form and content
substantially similar to Exhibit 9(a)(iv) hereto (the “IP
Assignment”);
(v) a
license agreement in form and content substantially similar to Exhibit 9(a)(v)
hereto (the “License Assignment”);
(vi) a
product purchase agreement in form and content substantially similar to Exhibit
9(a)(vi) hereto (the “Product Purchase Agreement”); and
(vii) the
original vehicle title for the Van identified by VIN #
0XXXX00X000000000.
(b) by
Seller and its affiliates:
(i) this
Agreement;
(ii) the
Xxxx of Sale and Assignment and Assumption Agreement;
(iv) the
IP Assignment;
(v) the
License Agreement;
(vi) the
Product Purchase Agreement;
(vii) the
Operating Agreement; and
(vii) the
Side Letter.
10. COVENANTS.
(a) Employees. Effective
immediately prior to the Closing, Seller shall terminate all of Seller’s current
employees. Seller shall remain liable for all accrued amounts owed to
such employees through the Closing, other than the accrued PTO for its current
employees (which shall be the responsibility of Buyer and relating to which
Buyer shall deliver such documentation as may be reasonably requested by Seller
demonstrating satisfaction of these obligations). Effective
immediately upon the Closing and the termination of their employment by Seller,
Buyer shall offer to hire all of Seller’s current employees on substantially
comparable employment terms, measured in the aggregate.
(b) Contractual
Consents. With respect to the Assumed Contracts, (i) Seller shall
be responsible for any payment or other obligations arising prior to the Closing
that were
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scheduled
to be performed under those Assumed Contracts prior to the Closing and that
relate solely to the operations of Seller prior to the Closing; (ii) Buyer
will
pay and perform all other payment and other obligations arising under such
Assumed Contracts promptly as and when required and in compliance with those
agreements, (iii) Buyer shall not increase or permit to be increased, by action
or omission, Seller’s obligations under any of the Assumed Contracts (whether by
extension, renewal of term, amendment of obligations, or other actions or
omissions), and (iv) Buyer and Seller agree to work together, and use
commercially reasonable efforts, if required by such Assumed Contract, to obtain
a consent to the assignment from Seller to Buyer as promptly as possible
following the Closing. In addition, Buyer and Seller agree to work
together, and use commercially reasonable efforts, to interact and negotiate
with any and all other third parties under the Assumed Contracts to obtain
a
novation and/or release of Seller from any and all obligations thereunder
(pursuant to documentation reasonably acceptable to both Seller and
Buyer). If, within sixty (60) days following the Closing, the parties
have been unable to obtain (A) a novation or release for Seller under any
Assumed Contract (other than the Assumed Contracts with the municipalities
listed on Schedule 10(b) which are referred to herein as the “Municipal
Contracts”))as contemplated in this Section 10(b) that as of the Closing had
an aggregate amount payable or cost of remaining performance thereunder of
Five
Thousand Dollars ($5,000) or more (including, in each case, any costs arising
upon termination or expiration of such Assumed Contract) and (B) the consent
to
the assignment and assumption of each Assumed Contract by Buyer (to the extent
required by each Assumed Contract), Seller shall have the right to direct Buyer
to promptly terminate such contract for which a novation, release, and/or
assignment has not been obtained (and Buyer shall do so) or to terminate such
contract itself and Buyer shall be responsible for all expenses arising from
and/or due to such termination. If, after sixty (60) days following
the Closing, the parties have been unable to obtain a novation and/or release
of
Seller under, and an assignment of, any Municipal Contract, Seller and Buyer
shall engage in good faith negotiations concerning the best actions to be taken
with respect to any such Municipal Contract and shall use their good faith
best
efforts to implement such actions with a goal of ending Seller’s obligations
with respect to such Municipal Contract while enabling Buyer to continue to
enjoy the benefits of such Municipal Contract.
11. INDEMNIFICATION.
(a) Buyer’s
and Buyer Member’s Obligation. Buyer agrees to, and does hereby,
indemnify and hold harmless Seller and its affiliates and each of their
respective officers, directors, partners, employees, agents, successors and
assigns (as a group, “Representatives”) from and against any and all
demands, claims, actions, causes of action, assessments, losses, obligations,
damages, liabilities, fines, costs and expenses, including, without limitation,
interest, penalties, and reasonable attorneys fees and expenses
(collectively “Damages”), that Seller or its Representatives may suffer
resulting from, arising out of or in any way relating to (i) any
misrepresentation in or breach or non-fulfillment of any representation or
warranty of Buyer or Buyer Member or breach or non-fulfillment of any covenant,
obligation, or agreement of Buyer or Buyer Member contained herein or (ii)
any
of the Assumed Liabilities.
(b) Seller’s
Obligation. Seller agrees to, and does hereby, indemnify and hold
harmless Buyer and Buyer Member and Representatives of Buyer or Buyer Member
from and against any and all Damages that Buyer, Buyer Member, or
Representatives of either may suffer
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resulting
from, arising out of or in any way relating to (i) any misrepresentation in
or
breach or non-fulfillment of any representation or warranty of Seller or breach
or non-fulfillment of any covenant, obligation or agreement of Seller contained
herein or (ii) any of the Excluded Liabilities (including any claims asserted
under any principle or theory of successor or transferee liability) or Excluded
Assets.
(c) Notice. No
right to indemnification hereunder shall be available to any party seeking
indemnification (“Indemnitee”) unless the Indemnitee shall have provided,
promptly after acquiring knowledge of the existence of a claim (or facts that
might reasonably be expected to give rise to a claim in the future), the person
from whom indemnification is sought (“Indemnitor”) a written notice
describing in reasonable detail the facts giving rise to the claim (or facts
that might reasonably be expected to give rise to a claim in the future) for
indemnification hereunder and enclosing a copy of any papers served upon the
Indemnitee, if any. Failure to promptly give notice shall reduce (not
eliminate) Indemnitor’s obligations under this Section 11(c) only to the extent
that Indemnitor’s obligations are directly increased due to the
delay.
(d) Procedure. In
the event that indemnification is sought for third party claims (a “Third
Party Claim”), Indemnitor will have the right at any time to assume and
thereafter to conduct at its expense the defense of the Third Party Claim with
counsel of Indemnitor’s choice (reasonably satisfactory to Indemnitee);
provided, however, that Indemnitor shall not consent to the entry of a judgment
or enter into any settlement with respect to the Third Party Claim without
the
prior written consent of Indemnitee (which consent will not be unreasonably
withheld) unless (i) the judgment or settlement involves only the payment of
monetary damages and does not impose an injunction or other equitable relief
upon Indemnitee and (ii) Indemnitor pays or causes to be paid all amounts
arising out of the judgment or settlement concurrently with the effectiveness
thereof. If Indemnitor assumes the defense of the Third Party Claim
it shall allow Indemnitee a reasonable opportunity to participate in the defense
thereof at Indemnitee’s expense with counsel of Indemnitee’s
choice. If the Indemnitor does not assume the defense of the action,
then Indemnitee may defend the action in any manner it may reasonably deem
appropriate; provided, however, that it shall allow Indemnitor a reasonable
opportunity to participate in the defense thereof at Indemnitor’s expense with
counsel of the Indemnitor’s choice. The party conducting the defense
of an action shall at all times reasonably and diligently pursue the
resolution thereof and shall at all times act in good faith and with reasonable
prudence to minimize the Damages as though these were for its own
account.
(e) Cooperation. A
party seeking indemnification for a third party claim shall, and shall cause
its
Representatives to, offer reasonable assistance in the defense of the
claim.
12. PAYMENT
OF EXPENSES. Except as otherwise provided herein, regardless of
whether the transactions provided for herein are consummated, each of the
parties hereto shall pay all costs and expenses (including, without limitation,
all fees and expenses of their respective counsel) incurred by them with respect
to this Agreement and the transactions set forth herein and contemplated
hereby. All sales and transfer taxes, and all recording, filing and
other fees
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(including
any penalties or interest), incurred in connection with this Agreement and
the
transactions contemplated hereby will be borne by Buyer.
13. MISCELLANEOUS.
(a) Transition
Assistance. Upon the execution of this Agreement and thereafter, the parties
hereto shall do such things as may be reasonably requested by the other parties
hereto in order to more effectively consummate or document the transactions
contemplated by this Agreement and the Transaction Documents. Without
limiting the generality of the foregoing, Buyer and Buyer Member shall assist
Seller as requested, without cost, in addressing, minimizing, and resolving
the
Excluded Liabilities.
(b) Notices. Any
notice required or permitted by this Agreement shall be in writing and shall
be
delivered as follows with notice deemed given as
indicated: (i) by personal delivery when delivered; (ii) by
overnight courier upon written verification of receipt; (iii) by facsimile
transmission when confirmed by facsimile transmission; or (iv) by certified
or registered mail, return receipt requested, upon verification of
receipt. All notices must be sent to the addresses described below or
to such other address that the receiving party may have provided for the purpose
of notice in accordance with this Section.
(i) If
to Buyer or Buyer Member:
Xx.
Xxxx
X. Xxxxx
0000
Xxxxxxx Xxxxx
Xxxxxx,
XX 00000
Facsimile: (000)
000-0000
with
a
required copy to (which shall not constitute notice):
Kamlet
Shepherd & Xxxxxxxx, LLP
0000
Xxxxxxxx Xxxxxx
Xxxxx
0,
Xxxxx 0000
Xxxxxx,
XX 00000
Attn: Xxx
Xxxxxxxx
Facsimile: (000)
000-0000
(ii) If
to Seller:
Xx.
Xxxxxx X. Xxxxxxxxxx
0000
X’Xxx Xxxxx
Xxx
Xxxx,
XX 00000
Telephone: (000)
000-0000
Facsimile:
(000) 000-0000
with
a
required copy to:
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Xxxxx
X.
Xxxxxxx
000
Xxxxx
Xxxx Xxxxxx
Xxxxx
000
Xxxxxxxxxxx,
XX 00000
Facsimile: (000)
000-0000
(c) Entire
Agreement and Modification. This Agreement (together with the
exhibits and schedules attached hereto and hereby incorporated herein) is
intended as a final, complete and exclusive statement of the terms and
conditions of the agreement of the parties with respect to the subject matter
hereof. No modification, rescission, termination or attempted waiver
of any of the terms, provisions or conditions of this Agreement shall be valid
unless in writing and signed by the party against which enforcement is
sought.
(d) Assignees
and Successors. This Agreement shall apply to, shall be binding
in all respects upon, and shall inure to the benefit of, the respective
successors, assigns, heirs and legal representatives of the parties
hereto.
(e) Action
Taken at the Closing. Except as otherwise indicated by the stated
date and/or time of a document, the execution and delivery of this Agreement,
all actions to be taken and transactions to occur in connection with this
Agreement at the Closing, and the consummation at the Closing of certain acts
and transactions to which reference is made in this Agreement, are to be
considered effected simultaneously as part of a number of interrelated
transactions, and all deliveries of documents and other acts at the Closing
are
to be deemed to have been made in escrow until all transactions referred to
in,
and relating to, this Agreement which are to take place at the Closing have
been
completed.
(f) Time
of Essence. With respect to all time periods and duties set forth
in this Agreement, time is of the essence.
(g) Governing
Law. This Agreement shall be governed and construed in accordance
with the substantive laws of the State of Delaware without regard to any
principles of conflicts of law.
(h) Counterparts. This
Agreement may be executed in one or more counterparts, any one of which need
not
contain the signatures of more than one party, but all such counterparts taken
together shall constitute one and the same agreement. This Agreement
may be executed by facsimile signature or electronic exchanges of documents
bearing a scanned signature, and a facsimile or copy of a signature is valid
as
an original.
(i) Records. To
the extent that documents and other materials (in paper or electronic form)
of
Seller are transferred to Buyer, Buyer, as reasonably requested by Seller from
time to time, will permit Seller and its Representatives to review such
documents and other materials and make copies thereof at Seller’s
cost.
(j) Publicity. Except
as set forth below, no public release or announcement concerning the
transactions contemplated hereby shall be issued by Buyer, Buyer Member
or
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Seller
without the prior consent of Seller (in the case of a release or announcement
by
Buyer or Buyer Member) or Buyer (in the case of a release or announcement by
Seller or Terabeam) (which consents shall not be unreasonably withheld), except
as such release or announcement may be required by law or the applicable rules
or regulations of any securities exchange or securities market, in which case
Seller or Buyer, as the case may be, shall allow Buyer or Seller, as applicable,
to the extent reasonably practicable in the circumstances, reasonable time
to
comment on such release or announcement in advance of such
issuance. Buyer and Buyer Member specifically acknowledge that
Seller’s parent company, Terabeam, may be required to file this Agreement and
other agreements and transactions contemplated hereby (with summary descriptions
thereof) with the Securities and Exchange Commission and hereby consent to
and
approve such filing.
(k) No
Third-Party Rights. This Agreement is not intended to and does
not create any rights in favor of any person not a party hereto.
(l) Severability.
If any provision of this Agreement is held invalid or unenforceable by any
court of competent jurisdiction, the other provisions of this Agreement will
remain in full force and effect. Any provision of this Agreement held
invalid or unenforceable only in part or degree will remain in full force and
effect to the extent not held invalid or unenforceable.
(m) Bulk
Sales. To the extent permitted by applicable law, each of Buyer,
Buyer Member and Seller hereby waive compliance by Buyer and Seller with any
bulk sales law and other similar law in any applicable jurisdiction with respect
to the transactions contemplated by this Agreement.
(n) Waiver
of Jury Trial. EACH OF BUYER, BUYER MEMBER AND SELLER HEREBY
IRREVOCABLY, KNOWINGLY, VOLUNTARILY, AND INTENTIONALLY WAIVES ANY RIGHTS THAT
IT
MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED UPON THIS
AGREEMENT, ARISING OUT OF, UNDER OR IN CONNECTION WITH THE TRANSACTIONS WHICH
THIS AGREEMENT EVIDENCES OR ANY COURSE OF CONDUCT, COURSE OF DEALINGS,
STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY OF THEM RELATING
HERETO.
(o) Disputes. If
a dispute arises out of this Agreement, or the interpretation, breach,
termination or validity thereof, each of the parties agrees to first request
a
meeting of senior management of the parties in a written notice that references
this paragraph. That meeting shall occur at a mutually agreeable time
and place within twenty (20) days of any such written notice. Neither
party shall assert any claim of laches, waiver, estoppel, or the like based
on
the time elapsed by following this procedure. If the dispute is
unresolved in whole or in part within twenty (20) days of such meeting, either
party may commence a legal proceeding. Each party hereby irrevocably
agrees that any legal action or proceeding by or against it arising out of
this
Agreement or the transactions contemplated hereby shall be brought only in
the
courts of the State of Delaware in and for the County of New Castle or (if
it
has jurisdiction) the U.S. District Court for the District of
Delaware. Each of the parties hereto irrevocably consents to
the
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exclusive
jurisdiction of any such state or federal court in connection with any matter
based upon or arising out of this Agreement or the matters contemplated herein,
agrees that process may be served upon them by mailing copies thereof by
registered United States mail, postage prepaid, to their address as specified
in
or pursuant to Section 13(b) or in any manner authorized by the laws of the
State of Delaware for such persons, and waives and covenants not to assert
or
plead any objection which they might otherwise have to such forum, such
jurisdiction, and such process.
[SIGNATURE
PAGE(S) TO FOLLOW]
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IN
WITNESS WHEREOF, the undersigned, intending to be legally bound hereby, have
duly executed this Agreement as of the day and year first written
above.
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RICOCHET
NETWORKS, INC.
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By: /s/
Xxxxx X. Xxxxxxx
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Name: Xxxxx
X. Xxxxxxx
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Title: Vice
President
|
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CIVITAS
WIRELESS SOLUTIONS, LLC
|
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By: /s/
Xxxx X. Xxxxx
|
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Name: Xxxx
X. Xxxxx
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Title: Manager
|
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/s/
Xxxx X. Xxxxx
|
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Xxxx
X. Xxxxx
|
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