EXHIBIT 10.11
AMENDMENT
TO
MARCH AGREEMENT
BY AND AMONG
NEXTEL COMMUMCATIONS, INC.,
DIGITAL RADIO, L.L.C.,
AND XXXXX X. XXXXX
EFFECTIVE AS OF
OCTOBER 3, 2003
TABLE OF CONTENTS
PAGE
1. Wireless Opportunity; Corporate Opportunity .......................................................... 1
2. Company Right to Buy Excess MMDS ..................................................................... 2
3. Financing for Major Transactions ..................................................................... 2
4. Notice and Exercise Procedure for Company Right to Purchase .......................................... 3
4.1 Channel Listing and Update ....................................................................... 3
4.2 Related Assets ................................................................................... 5
4.3 Company Exercise of Right ........................................................................ 5
5. Company Swap Rights .................................................................................. 6
6. Company Right of First Refusal ....................................................................... 7
7. Closing Under Company Right to Buy and Swap Rights ................................................... 8
7.1 Closing Timing and Deliveries .................................................................... 8
7.2 Conditions to All Parties' Obligations ........................................................... 9
7.3 Conditions to Acquirer's Obligation to Close ..................................................... 10
7.4 Conditions to Transferor's Obligation to Close ................................................... 11
7.5 Representations and Warranties of Acquirer in Connection with a Closing .......................... 11
7.6 Representation and Warranties of Transferor in Connection with a Closing ......................... 12
7.7 Pre-Closing Deliveries; Post-Closing Adjustments; Subsequent Closings; Further Assurances ........ 16
7.8 Claims for Breach ................................................................................ 17
7.9 Taxes ............................................................................................ 17
8. Convenants ........................................................................................... 17
8.1 Covenants ........................................................................................ 17
9. Representations and Warranties ....................................................................... 19
9.1 By Investor ...................................................................................... 19
9.2 By Individual .................................................................................... 19
9.3 By the Company ................................................................................... 20
10. Definitional Provisions .............................................................................. 20
10.1 Definitions ..................................................................................... 20
10.2 Other Definitional Provisions .................................................................. 20
11. General .............................................................................................. 24
TABLE OF CONTENTS
(continued)
PAGE
11.1 Arbitration .................................................................................... 24
11.2 Public Announcements ........................................................................... 25
11.3 Notices ........................................................................................ 25
11.4 Expenses ....................................................................................... 26
11.5 Benefits; Assignment ........................................................................... 26
11.6 Entire Agreement; Amendment and Waiver ......................................................... 26
11.7 Headings ....................................................................................... 26
11.8 Governing Law .................................................................................. 26
11.9 Severability ................................................................................... 26
11.10 Counterparts ................................................................................... 27
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AMENDMENT
TO
MARCH AGREEMENT
This Amendment effective as of October 3, 2003 (this "AMENDMENT") to amend
the Agreement dated as of March 5, 2003 (the "MARCH AGREEMENT") by and among
Nextel Communications, Inc., a Delaware corporation (the "COMPANY"), Digital
Radio, L.L.C., a Washington limited liability company ("INVESTOR") and Xxxxx X.
XxXxx ("INDIVIDUAL").
RECITALS
A. Subject to the terms and conditions below, the parties have agreed to
resolve a dispute as to the applicability of the "Wireless Opportunity"
provisions of the March Agreement by expressly permitting Investor and
Controlled Affiliates to acquire owned and leased MMDS Spectrum without first
offering the opportunity to the Company.
B. In order to resolve the dispute between the parties, Investor,
Individual and their respective Controlled Affiliates have agreed to give the
Company the rights on the terms and subject to the conditions described herein
(1)until August 13, 2004 to acquire any channels of owned or leased MMDS
Spectrum in excess of 6 channels owned or leased in a BTA; (2) to swap certain
channels of owned or leased MMDS Spectrum; and (3) a right of first refusal on a
sale of owned or leased MMDS Spectrum to a third party.
C. Subject to and conditioned upon Investor and Individual entering into
this agreement, the Board of the Company has renounced any interest or
expectancy of the Company in excluding Investor and Individual from certain MMDS
Spectrum acquisitions more specifically identified below.
AGREEMENT
1. WIRELESS OPPORTUNITY; CORPORATE OPPORTUNITY.
(a) The parties agree that acquisition of MMDS Spectrum by Investor and
any Controlled Affiliate will not be subject to the provision of Section 3.1 or
3.2 of the March Agreement.
(b) Except as stated in Section 1(a), nothing in this Amendment modifies
or waives any provision of the March Agreement. Except as modified by Section 1
(a), the March Agreement remains in full force and effect.
(c) The Company, having been granted the rights set forth in this
Amendment with respect to MMDS Spectrum, waives and will make no claim that the
acquisition of MMDS Spectrum by Individual (or by entities under his control)
constitutes a usurpation of a corporate opportunity of the Company, if such
acquisition (i) was the subject of a notice to the Company under the March
Agreement (or its predecessor); (ii) was discussed prior to October 3, 2003, but
had not been the subject of a written offer; or (iii) occurs after October
3, 2003.
2. COMPANY RIGHT TO BUY EXCESS MMDS.
(a) The Company has the right to acquire under Section 4 from Investor and
from any Controlled Affiliate (each, a "COM ENTITY") any MMDS Spectrum in excess
of Six Retained Channels in any BTA that are owned by, leased to, or subject to
contract for purchase or lease by a COM Entity.
(b) "SIX RETAINED CHANNELS" means a total of six MMDS and/or ITFS channels
in any BTA that are owned, leased or subject to a contract for purchase or lease
by the COM Entities. The proportion of owned and leased channels in the Six
Retained Channels will be in the same proportion as the proportion of owned and
leased spectrum for the aggregate COM Entity MMDS Spectrum in such BTA Including
both (i) channels owned or leased or subject to a contract for purchase or lease
on August 14, 2004 that are to be included in the Channel Listing and Update,
and (ii) channels acquired pursuant to an Acquisition Agreement that was subject
to Section 3 (clauses (i) and (ii), the "COM ENTITY CHANNELS"). If the COM
Entities acquires six or more MMDS and/or ITFS channels pursuant to an
Acquisition Agreement and the Company does not exercise its rights under Section
3, then, at Investor's election, either (i) all channels so acquired will
constitute the Six Retained Channels for the applicable geographic area, and the
Company will be entitled to acquire all COM Entity Channels in that geographic
area that were not acquired under the Acquisition Agreement, or (ii) the Six
Retained Channels will be determined pursuant to this paragraph without regard
for whether they were acquired pursuant to an Acquisition Agreement, provided
that in such event, all channels in excess of the Six Retained Channels in each
applicable geographic market will be subject to the provisions of Section 4. If
there are not 6 channels available that are licensed to provide coverage to the
entire BTA, the six channel requirement will be met by permitting the COM
Entities to retain one or more sets of six channels with non-overlapping foot
prints that, within any set of retained channels, cover comparable geographic
areas in the BTA, or, if such channels do not provide the COM Entities with
coverage to all geographic areas in the BTA that were covered by the COM Entity
Channels on August 13, 2003, up to 6 channels that provide such coverage. If the
channels to be retained have overlapping footprints so that the COM Entities
have the use of more than six channels in any part of a BTA, the COM Entities
will as part of the Closing if the Company exercises its rights under Section 4
enter into agreements with a member of the Nextel Group to provide rights to the
Nextel Group member to use such channels so that the COM Entities do not have
the use of more than six channels in any part of the BTA. If the Investor and
the Company cannot agree on the terms for the Nextel Group's right to use such
channels, then, not sooner than 30 days after giving notice that it will
exercise that right if the parties do not agree, either party can initiate
arbitration under Section 11.1.
(c) The channels to be retained by the COM Entities will be mutually
agreed by Investor and the Company, with each party acting reasonably and in
good faith to determine the channels to be retained based on actual or
prospective requirements of the business of the COM Entities and the Nextel
Group. If the Investor and the Company cannot agree by August 20, 2004 on the
channels to be included in the Six Retained Channels, either party can initiate
arbitration under Section 11.1.
3. FINANCING FOR MAJOR TRANSACTIONS.
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(a) If on or before August 13, 2004 Investor or a Controlled Affiliate has
entered into a binding commitment to acquire ownership or leasehold interests
in MMDS Spectrum with a third Person (an "ACQUISITION AGREEMENT") and the cash
consideration payable under the Acquisition Agreement for owned and/or leased
MMDS Spectrum that will be acquired is in excess of $100 million, Investor will
give notice to the Company (the "SECTION 3 NOTICE"), together with a copy of the
Acquisition Agreement (including all schedules and exhibits). The Company will
have 30 days after receiving the Section 3 Notice to elect whether to exercise
its right to acquire any MMDS Spectrum being acquired under the Acquisition
Agreement in excess of Six Retained Channels. If the Company does not elect to
exercise its right under this Section 3, and subject to the provisions of
Section 2(b), the provisions of Section 4 do not apply to the channels
identified in the applicable Section 3 Notice. For the avoidance of doubt,
Sections 5 and 6 will apply to the channels identified in the Section 3 Notice.
(b) If the Company timely elects to exercise its right:
(i) the Company will be required to pay on the later of (a) 60 days
after receiving the Section 3 Notice, or (b) the date when payment
is due under the Acquisition Agreement, the consideration payable
for the excess MMDS Spectrum the Company elects to acquire; and
(ii) the COM Entity will proceed as promptly as practicable to transfer
to the Company, on terms consistent with those set forth under
Section 7, the MMDS Spectrum in excess of Six Retained Channels that
the Company elects to acquire.
4. NOTICE AND EXERCISE PROCEDURE FOR COMPANY RIGHT TO PURCHASE.
4.1 CHANNEL LISTING AND UPDATE.
(a) On June 14, 2004, Investor will deliver to the Company a list (the
"CHANNEL LISTING") setting out:
(A) for each MMDS channel owned by a COM Entity, and for each MMDS
channel under contract to be acquired by a COM Entity,
(1) the FCC licensee for the channel,
(2) the name of the COM Entity with rights to the channel,
(3) the BTA, call sign, or other identifying information for
the channel,
(4) the consideration paid (or to be paid) to the seller to
acquire that channel (not including legal expenses,
closing costs, or other costs associated with the
acquisition),
(5) the Carrying Costs incurred for such channel from the
date of the purchase by the COM Entity through the most
recent practicable date,
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(6) an Asset Listing for all Related Assets associated with
each channel, and
(7) the Deal Expenses for the acquisition of that channel
and any Related Assets.
(B) for each MMDS or ITFS channel leased to a COM Entity, and for
each MMDS or ITFS channel under contract to give a COM Entity
the right to use the channel
(1) the FCC licensee for the channel,
(2) the name of the COM Entity with rights to the channel,
(3) the BTA, call sign, or other identifying information for
the channel,
(4) the consideration paid (or to be paid) to the seller in
connection with the assumption of that channel (or, if
more than one channel was covered by the lease, a pro
rata part thereof) (not including legal expenses,
closing costs, or other costs associated with the
acquisition),
(5) a summary of payments due under the lease,
(6) the Carrying Costs for such channel from the date the
spectrum lease was assumed by the COM Entity through the
most recent practicable date,
(7) an Asset Listing for all Related Assets associated with
each channel, and
(8) the Deal Expenses for the acquisition of the channel and
any Related Assets.
(b) On July 13, 2004, Investor will deliver an update to the Channel
Listing containing any new or additional information that would be included in a
Channel Listing as of that date (the "UPDATE").
(c) With the Channel Listing and with the Update, Investor will deliver to
the Company a true and correct copy of each lease or other agreement giving a
COM Entity the right to use a channel identified on the Channel Listing or the
Update and any Related Assets. The Company will have a period of 60 days to
review the Channel Listing and 30 days to review the Update. During the period
of the Company's review, Investor will provide any additional information
reasonably requested by the Company to facilitate its review and understanding
of the information reflected on the Channel Listing or the Update (including, in
each case, the Asset Listing that is a part thereof), the terms of any channel
or spectrum lease acquisition by the COM Entity, and the Carrying Costs.
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(d) Investor's disclosure obligation under this Section 4.1 will be
limited to the extent required by the terms of any confidentiality agreement or
similar undertaking in a contract with a third Person. Investor will identify
the channels where disclosure is limited by this Section 4.2(d).
4.2 RELATED ASSETS.
(a) "RELATED ASSETS" means the tower sites and equipment used by a
Transferor in connection with any BTATC License or BTATC Spectrum Lease on or
about the date of the Closing and any tower sites or equipment owned or held by
a Transferor solely for use in connection with any BTATC License or BTATC
Spectrum Lease. Subject to obtaining Third Party Consents, a Transferor will
transfer or assign in connection with the transfer or assignment of a channel or
spectrum lease, any Related Assets used, owned or held solely and exclusively in
connection with the channel or spectrum lease being transferred or assigned. If
a BTATC Spectrum Lease cannot be transferred at an initial Closing, Related
Assets associated with the channels subject to that lease will not be
transferred and the Use and Access Agreement (as defined below) for those
Related Assets will not be entered into unless and until the BTATC Spectrum
Lease is assigned. As to all other Related Assets (which relate solely to that
lease and not to any other BTATC License or BTATC Spectrum Lease that is being
transferred), subject to obtaining Third Party Consents, the Transferor and
Acquiror will enter into an agreement in a form to be agreed by the parties on
arm's-length terms allowing the Acquiror the use of and access to the Other
Related Assets (a "USE AND ACCESS AGREEMENT"). If the Transferor and Acquiror
cannot agree on the terms of the Use and Access Agreement, then, not sooner than
30 days after giving notice that it will exercise that right if the parties do
not agree, either party can initiate arbitration under Section 11.1.
(b) "ASSET LISTING" means a schedule identifying the Related Assets
relevant to the BTATC License(s) or BTATC Spectrum Lease(s) for a particular
transaction Closing which sets forth: (i) identifying information for each
channel; (ii) the tower sites then used or held for use in connection, with that
channel; (iii) whether the site is used solely for that channel or held for use
solely for that channel or is also used with other channels; (iv) the equipment
then used or held for use in connection with that channel; (v) whether the
equipment is used solely for that channel or held for use solely for that
channel or is also used with retained channels (whether owned or leased).
4.3 COMPANY EXERCISE OF RIGHT.
(a) On August 13, 2004, or, if later, 60 days after delivery of the
Channel Listing or 30 days after delivery of the Update, the Company has the
right to give notice to Investor that the Company will acquire in any BTA any or
all channels in excess of Six Retained Channels covered by any license owned (or
under contract to be owned) by, or covered by any lease (or under any lease
under contract to be acquired by) to a COM Entity (the "CALL NOTICE"). The
Closing of the transaction will occur pursuant to Article 7.
(b) Subject to obtaining any Third Party Consents and to the Company's
right to exclude a BTATC License or BTATC Spectrum Lease and Related Assets as
contemplated by Section 7.3(a), the Call Notice irrevocably obligates (i) the
Company, or another member of the
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Nextel Group designated by the Company, to buy and the relevant COM Entity to
sell the owned channels identified in the Call Notice together with their
Related Assets for a purchase price equal to the consideration paid (or to be
paid) to the seller to acquire that channel, plus Deal Expenses, plus the
Carrying Costs for those channels for the period the channel was owned by the
COM Entity and (ii) the Company to assume and the relevant COM Entity to assign
in relevant part the leases for the leased channels identified in the Call
Notice together with, their Related Assets for a purchase price equal to the sum
of (w) any consideration paid (or to be paid) to the lessor or transferor to
acquire the lease; plus (x) the assumption of all future obligations under the
lease; plus (y) Deal Expenses; plus (z) the Carrying Costs for those channels
for the period the channel was leased to the COM Entity.
5. COMPANY SWAP RIGHTS.
(a) Subject to the conditions of Section 5.2(b), until October 3, 2006,
the Company has the right to exchange:
(1) any MMDS channel licensed to a member of the Nextel Group in a
BTA for an MMDS channel licensed to a COM Entity In that BTA;
(2) subject to obtaining any Third Party Consents, any MMDS
channel leased to a member of the Nextel Group in a BTA for an
MMDS channel leased to a COM Entity in that BTA;
(3) subject to obtaining any Third Party Consents, either:
(i) any MMDS channel owned by a Member of the Nextel Group
in a BTA for an MMDS channel leased to a COM Entity in
that BTA; or
(ii) any MMDS Channel leased to a Member of the Nextel Group
in that BTA under a Qualifying Lease of ran MMDS Channel
owned by a COM Entity;
(b) An exchange under this Section 5.2(a) is not permitted unless: (i) the
channel that the Company receives in the exchange can be "paired" with another
channel owned or leased to a member of the Nextel Group under the orders issued
by the FCC in the MMDS Band Plan Proceeding; and (ii) the channels in any set of
two to be exchanged have overlapping footprints covering comparable geographic
areas in the BTA.
(c) For each exchange the parties will jointly determine whether the value
being exchanged, including coverage and other terms of any license, spectrum
lease costs (taking into account the term of the lease and renewal rights as
well as payments due thereunder) are comparable or whether one of the parties is
losing value in the exchange. If a party is losing value, the parties will
negotiate in good faith a payment to compensate the party losing value which
payment will be due and payable at the closing of the exchange. If after 60
days, the parties cannot agree on whether compensation is payable or on the
amount of compensation to be paid, either party can submit the matter to
arbitration under Section 11.1.
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(d) Any exchange closing under this Section 5 will include Related Assets
for the channels being exchanged and will be pursuant to Article 7 with (i) a
designated Controlled Affiliate of the Company as Acquirer for the channel being
transferred by the COM Entity and as Transferor for the channel being
transferred by the member of the Nextel Group; and (ii) a COM Entity designated
by Investor as the Acquirer for the channel being transferred by the Company (or
its Affiliate) and as Transferor for the channel being transferred by the COM
Entity.
(e) Nextel will pay all reasonable costs associated with moving customers
of both parties off the channels exchanged pursuant to this Section 5 and onto
the other channel to the exchange.
(f) At Nextel's request Investor will prepare a Channel Listing (in
addition to the Channel Listing required under Section 4.1) to be delivered not
sooner than 90 days and not later than 120 days after delivery of the request. A
Channel Listing prepared pursuant to this Section 5(1) does not need to include
any information regarding Deal Expenses, except for Deal Expenses related to the
exchange, if any are then known.
6. COMPANY RIGHT OF FIRST REFUSAL.
(a) If, on or before October 3, 2006, any COM Entity receives from or
otherwise negotiates with a third Person all the material terms of an offer to
purchase any owned or leased MMDS Spectrum that (i) a COM Entity acquired or is
subject to a contract for purchase or lease with a COM Entity on or before
August 13, 2004, or (ii) that was received in exchange for MMDS Spectrum
described in clause (i), and if the COM Entity intends to pursue such sale, then
Investor will provide to the Company a notice (the "OFFER NOTICE") identifying
the purchaser, the MMDS Spectrum to be sold, the cash and any other
consideration price to be paid or received, and all the other material terms of
the proposed transaction ("OFFER TERMS"), and will deliver copies of all the
documents with the third Person or its Affiliates relating to the proposed sale.
If the Offer Terms include non-cash consideration, the Offer Notice will include
the COM Entity's valuation of the non-cash consideration. The Company may
request and the COM Entity will provide any information readily available to the
COM Entity regarding the value of non-cash consideration. If the Company
disagrees with the value assigned to the non-cash consideration, and if the
parties cannot agree on the value, either party can initiate arbitration under
Section 11.1.
(b) A transaction involving a swap or exchange of MMDS Spectrum that
includes some cash consideration is not subject to the provisions of this
Section 6 unless the amount of cash is more than half the value of the
transaction. A transaction is not subject to the provisions of this Section if
it involves the sale of a business that has launched commercial service and the
sale includes only that MMDS Spectrum then being used to provide commercial
service. The sale of a business that has launched commercial service is subject
to the provisions of this Section if it includes MMDS Spectrum that is not then
being used to provide commercial service, and the Offer Notice and Offer Terms
will describe the business as well as the MMDS Spectrum, and, if the Company
elects to purchase, it must purchase the MMDS Spectrum and the business that the
third Person offered to purchase.
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(c) The delivery of an Offer Notice is an irrevocable offer by the COM
Entity to transfer the MMDS Spectrum (and, if applicable, any business described
in the Offer Terms) that is subject to the Offer Notice to the Company (or any
controlled Affiliate, designated by the Company) for a cash purchase price equal
to the total value of the consideration described in the Offer Terms and on the
other terms set forth in the documents with the third Person that accompanied
the Offer Notice. The Company will have a 30 day period in which to accept such
offer as to all (but not less than all) of the MMDS Spectrum (and, if
applicable, any business described in the Offer Terms) covered by the Offer
Notice. Such acceptance will be irrevocable. If the Company exercises its right,
the closing of the transaction will occur as provided in the offer from the
third Person and, to the extent not defined by the Offer Terms, in accordance
with Sections 7.1 through 7.8. If the Offer Terms include the sale of a
business, the representations and warranties related to the business will be
those set forth in the Offer Terms, or, if there are none stated in the Offer
Terms, customary representations and warranties, as the parties may agree. If
the parties cannot agree, then, not sooner than 30 days after giving notice that
it will exercise that right if the parties do not agree, either party can
initiate arbitration under Section 11.1.
(d) If the Company rejects or fails to timely exercise its right to
purchase under Section 6.(a), the COM Entity will be entitled to consummate the
sale of all (but not less than all) of the owned or leased MMDS Spectrum (and,
if applicable, any related business) described in the Offer Notice to the third
Person identified in the Offer Terms at a price and other terms not less
favorable to the purchaser in any material respect than the Offer Terms. If a
closing to consummate a sale permitted by this Section 6 has not occurred within
one year of the Offer Notice, the sale may not be completed without repeating
the procedures of this Section 6.
(e) If a COM Entity did an exchange that included both MMDS Spectrum that
was acquired or to which rights were acquired by a COM Entity before August 13,
2004, and MMDS Spectrum acquired after that date, and if there is a subsequent
sale of fee MMDS Spectrum received in the exchange, then it will be presumed for
purposes of this Section 6 that the MMDS Spectrum being sold was, to the extent
of the value of the pre-August 13, 2004 spectrum, received in exchange for the
pre-August 14, 2004 MMDS Spectrum.
7. CLOSING UNDER COMPANY RIGHT TO BUY AND SWAP RIGHTS.
7.1 CLOSING TIMING AND DELIVERIES.
(a) The initial closing of the transfers and assignments contemplated by
Section 4 or Section 5 (each a "CLOSING") will each occur 14 days after the
conditions set forth in Section 7.2 through 7.4 have been first satisfied or
waived.
(A) Each Acquiror will deliver at the initial Closing:
(1) cash in an amount equal to the purchase price payable,
less the purchase price for assets or rights that cannot
transfer at that Closing because Third Party Consents
have not been obtained, plus any Carrying Costs payable;
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(2) an executed instrument of assignment and assumption in
the form agreed by the parties assuming Transferor's
obligations under any agreements relating to spectrum
leases or Related Assets to be transferred for which
Third Party Consents are not required or have been
obtained;
(3) evidence that any amendments, modifications or other
consideration due to third Persons as contemplated by
Section 8.1(d) have been made and/or delivered;
(4) executed Use and Access Agreements for any Related
Assets that are to be made available to the Acquiror as
set forth in Section 4.2(a).
(5) the officer's certificate described in Section 7.4(c).
(B) Each Transferor will deliver at the initial Closing:
(1) an executed instrument of assignment and assumption in
the form agreed by the parties transferring Transferor's
rights under any agreements relating to spectrum leases
or Related Assets to be transferred for which Third
Party Consents are not required or have been obtained;
(2) a xxxx of sale (or one or more real property deeds, if
there are Owned Towers to be transferred) for any
Related Assets that are to transfer for which any Third
Party Consents are not required or have been obtained;
(3) executed Use and Access Agreements for any Related
Assets that are to be made available to the Acquiror as
set forth in Section 4.2(a).
(4) the officer's certificate described in Section 7.3(c).
(b) If an initial Closing has occurred, but at the time of the initial
Closing there were Third Party Consents to obtain in order to transfer all the
assets and rights that are to be transferred under the Call Notice, then on the
180th day after the initial Closing, or on such other day as the parties may
agree, there will be a subsequent closing and the parties will make the
deliveries described in Section, 7.1(a) with respect to the additional assets
and other rights that can be transferred at the time of the subsequent Closing.
7.2 CONDITIONS TO ALL PARTIES' OBLIGATIONS. The obligations of each
Acquiror on the one hand and each Transferor on the other hand to effect a
Closing are subject to the satisfaction (or waiver by the Company and Investor)
at or prior to the Closing of each of the following conditions:
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(a) No temporary restraining order, preliminary or permanent injunction or
other order issued by any court of competent jurisdiction will be in effect or
pending which materially delays, restrains, enjoins, or seeks to prohibit the
Closing.
(b) Any waiting period under the HSR Act applicable to the transactions to
occur at the Closing will have expired or been earlier terminated.
(c) The transfer of any BTATC Licenses will have been authorized by a
Final Order.
(d) If the Closing is occurring under Section 5, any Third Party Consent
necessary to exchange either of the BTATC Spectrum Leases in any set to be
exchanged will have been obtained.
7.3. CONDITIONS TO ACQUIROR'S OBLIGATION TO CLOSE. The obligation of the
Acquiror to effect a Closing and to pay the consideration due at that Closing is
subject to the satisfaction (or waiver by Acquiror) at or prior to the Closing
of each of the following conditions:
(a) The representations and warranties of each Transferor set forth in
Section 7.6 will be true in all material respects as of the date of the Closing,
or,
(A) if any representation or warranty relating to a BTATC License
is not true in any material respect because of any action or
inaction by a COM Entity, or because of a discovery of facts
or circumstances not known by a COM Entity at the time it was
acquired, then (A) the parties have agreed to an adjustment of
the purchase price that takes into account the impairment and
the BTATC License and Related Assets will be transferred; or
(B) the Acquiror has elected not to purchase the affected
BTATC License and Related Assets and the purchase price has
been adjusted; and
(B) if any representation or warranty relating to a BTATC Spectrum
Lease is not true in any material respect because of any
action or inaction by a COM Entity, or because of a discovery
of facts or circumstances not known by a COM Entity at the
time it was acquired, then (A) the parties have agreed to an
adjustment of the purchase price that takes into account the
impairment and the BTATC Spectrum Lease and Related Assets
will be transferred; or (B) the Acquiror has elected not to
acquire the affected BTATC Spectrum Lease and Related Assets
and the purchase price has been adjusted;
(C) if any representation or warranty relating to a Related Asset
is not true in any material respect because of any action or
inaction by a COM Entity, or because of a discovery of facts
or circumstances not known by a COM Entity at the time it was
acquired, the parties have either agreed (A) to an appropriate
adjustment or arrangement, or (B) the Acquiror has elected not
to acquire that Related Asset;
(D) if any representation or warranty related to a BTATC License
or BTATC Spectrum Lease is untrue in any material respect, and
Section 7.3(a)(A)
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and (a)(B) do not apply, then the Acquiror is reasonably
satisfied with the disclosures and any other information
provided by a Transferor in connection with any information
provided in any disclosure schedule delivered by a Transferor
under Section 7.6; and
(E) if any representation or warranty related to a Related Asset
is untrue in any material respect and Section 7.3(a)(C) does
not apply, then either (A) the Acquiror has elected not to
acquire the Related Asset and the BTATC License or BTATC
Spectrum Lease to which it relates, and the purchase price has
been adjusted; or (B) the Acquiror will close over the
inaccuracy that was disclosed, and waive any claim for breach
associated with the inaccuracy that was disclosed.
(b) Each Transferor and its Affiliates will have performed and complied
with all covenants and obligations to effect the Closing required by this
Agreement to be complied with or performed prior to the Closing.
(c) Acquiror will have received a certificate, dated the date of the
Closing, signed by an officer of each Transferor stating that the conditions of
Section 7.3(a) and (b) have been satisfied.
7.4 CONDITIONS TO TRANSFEROR'S OBLIGATION TO CLOSE. The obligation of the
Transferor(s) to effect the Closing is subject to the satisfaction (or waiver by
an Transferor) at or prior to the Closing of each of the following conditions:
(a) The representations and warranties of Acquiror set forth in Section
7.5 will be true in all material respects as of the date of the Closing.
(b) Acquiror and its Affiliates will have performed and complied with all
covenants and obligations to effect the Closing required by this Agreement to be
complied with or performed prior to the Closing.
(c) Transferors will have received a certificate, dated the date of the
Closing, signed by an officer of the Acquiror stating that the conditions of
Section 7.4(a) and (b) have been satisfied.
7.5 REPRESENTATIONS AND WARRANTIES OF ACQUIROR IN CONNECTION WITH A
CLOSING. At each Closing, Acquiror will represent and warrant to Transferor that
on the day of the Closing:
(a) Acquiror is an entity duly organized, validly existing and in good
standing under the laws of the state under which it was created and has all
requisite entity power and authority to carry on its business as now conducted
and to enter into and perform the documents to be delivered at the Closing.
(b) Acquiror has taken all necessary action for it to authorize the
execution, delivery and performance of each document to be delivered by it at
the Closing. Each agreement to be delivered by Acquiror at the Closing has been
duly executed and delivered by Acquiror and is a
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valid and binding agreement of Acquiror enforceable against Acquiror in
accordance with its terms, except as may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other similar Laws of general
application which may affect the enforcement of creditor's rights generally and
by general equitable principles.
(c) Execution, delivery and performance of each document to be delivered
at the Closing and the consummation of the transactions to be effected at the
Closing will not result in any violation of, conflict with, constitute a default
(with or without notice or lapse of time) under, or give rise to a right of
termination, cancellation, acceleration of, or the imposition of any lien, claim
or encumbrance under, or require any consent under or require a payment by
Acquiror or any of its Affiliates to any other Person pursuant to (i) the
organizational documents of Acquiror, (ii) any note, bond, debt instrument,
mortgage, indenture or other agreement or instrument to which Acquiror or any of
its Affiliates is a party, or (iii) any Law or Order by which Acquiror or any
of its Affiliates is bound.
(d) Except for those that have been made or obtained, no consent,
approval, license, permit or authorization Of or registration, declaration or
filing with any Governmental Authority is required to be obtained or made by
Acquiror or any of its Affiliates in connection with the Closing or the
transactions to be effected thereby.
(e) Acquiror has no obligation to any agent, broker, or other Person for
any fee or commission in connection with the Closing or the transactions to be
effected thereby.
7.6 REPRESENTATIONS AND WARRANTIES OF TRANSFEROR IN CONNECTION WITH A
CLOSING. At each Closing, each Transferor will represent and warrant to Acquiror
that, except as set forth on the Closing Date Schedules, on the date of the
Closing:
(a) Transferor is an entity duly organized, validly existing and in good
standing under the laws of the state under which it was created and has all
requisite entity power and authority to carry on its business as now conducted
and to enter into and perform the documents to be delivered at the Closing.
(b) Transferor has taken all necessary action for it to authorize the
execution, delivery and performance of each document to be delivered by it at
the Closing. Each agreement to be delivered by Transferor at the Closing has
been duly executed and delivered by Transferor and is a valid and binding
agreement of Transferor enforceable against Transferor in accordance with its
terms, except as may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other similar Laws of general application which
may affect the enforcement of creditor's rights generally and by general
equitable principles.
(c) Execution, delivery and performance of each document to be delivered
at the Closing and the consummation of the transactions to be effected at the
Closing will not result in any violation of, conflict with, constitute a default
(with or without notice or lapse of time) under, or give rise to a right of
termination, cancellation, acceleration of, or the imposition of any lien, claim
or encumbrance under, or require any consent under or require a payment by
Transferor or any of its Affiliates to any other Person pursuant to (i) the
organizational documents of Transferor, (ii) any note, bond, debt instrument,
mortgage, indenture, BTATC
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spectrum Lease, agreement relating to a Related Asset or other agreement or
instrument to which Transferor or any of its Affiliates is a party, or (iii) any
Law or Order by which Transferor or any of its Affiliates is bound.
(d) Except for those that have been made or obtained, no consent,
approval, license, permit or authorizations of or registration, declaration or
filing with any Governmental Agency is required to be obtained or made by
Transferor or any of its Affiliates in connection with the Closing or other
transactions to effected thereby.
(e) Transferor has no obligation to any agent, broker, or other Person for
any fee or commission in connection with the Closing or the transactions to be
effected thereby.
(f) Transferor has good and valid title to all of the tangible personal
property to be transferred at Closing, free and clear of any liens, claims or
encumbrances, other than mechanics, carriers, repairman's or similar liens
arising in the ordinary course of business or liens for taxes not yet due and
payable.
(g) Except as set forth on Schedule A: (i) the grant, renewal or
assignment of the BTATC Licenses to the existing licensee thereof was approved
by the FCC by Final Order, and (ii) the BTATC Licenses are validly issued and in
full force and effect. Except as set forth on Schedule A, there is no Proceeding
pending before the FCC or, to the Knowledge of the Transferor, threatened,
which, if determined as requested by the moving party or as indicated in any
document initiating such Proceeding, could result in the revocation,
modification, restriction, cancellation, termination or non-renewal of any BTATC
License or other action which is adverse to the Transferor, or the imposition of
a monetary fine. Sellers have made on a timely basis all payments to the United
States Government for those of the BTATC Licenses that are BTA authorizations.
(h) Except as set forth on Schedule A and Schedule D, (i) the facilities
subject to a BTATC License for which a certification or notification of
completion of construction has been filed with the FCC ("CONSTRUCTED
FACILITIES") are operating and at all times since August 1, 2003 have been
operating in material compliance with the FCC authorization therefor, the
Communications Act, and (ii) the Transferor is not transmitting from or
otherwise operating any facility mat is not the subject of an FCC authorization.
Except as set forth on Schedule D: (i) none of the facilities subject to a BTATC
License (x) is authorized pursuant to an authorization which is subject to
challenge before the United States Court of Appeals, or (y) is subject to any
lease, sub-lease or any agreement to make it available to a third Person; (ii)
no BTATC License is subject to (x) a revocation proceeding or (y) a pending
request for waiver of Section 21.303 of the FCC Rules; and (iii) no Constructed
Facilities are operating pursuant to special temporary or developmental
authority.
(i) Since January 1, 2001, all Annual FCC Reports required to be filed by
Transferor with the FCC with respect to the BTATC Licenses have been timely
filed. Except as set forth on Schedule D, to the Knowledge of Transferor, all
Annual FCC Reports filed for calendar year 2002 or thereafter are complete and
accurate.
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(j) Transferor has delivered to Acquiror true and complete copies of the
FCC Licenses for each BTATC License, and all documents filed in any Proceeding
pending at the FCC relating to the BTATC Licenses.
(k) For each BTATC Spectrum Lease, Schedule E sets forth: (i) the name of
the third-party lessor; (ii) the name of the Transferor entity that is the
lessee; (iii) the FCC call sign or file number covering the BTATC Spectrum
Lease; (iv) the channels and BTA in which the BTATC Spectrum Lease is used or
useful; and (v) the expiration date of the BTATC Spectrum Lease.
(l) Except as set forth on Schedule F, each BTATC Spectrum Lease is valid,
binding and in full force and effect, meets all requirements of Law, and is
enforceable in accordance with its terms. Transferor is the lessee under each
BTATC Spectrum Lease (by entry into the BTATC Spectrum Lease, assignment of such
lease, transfer of rights or other means) and has the sole right to use the
spectrum under each BTATC Spectrum Lease. To the Knowledge of Transferors, other
than the terms of each BTATC Spectrum Lease and the FCC Rules limiting the
duration of such BTATC Spectrum Leases, there are no facts or circumstances that
might (whether with or without notice, lapse of time or the occurrence of any
other event) preclude the renewal or extension of such BTATC Spectrum Leases in
the ordinary course. Except as set forth on Schedule F: (i) neither Transferors
nor to the Knowledge of Transferors any other party to any of the BTATC Spectrum
Leases has (x) failed to comply or is in breach or default thereunder or (y)
claimed in any written statement that the counterparty has failed to comply or
is in breach or default thereunder, and (ii) the consummation of the Closing
will not cause any violation, breach or default of any BTATC Spectrum Lease or
require the consent of the lessor thereunder. Except as set forth on Schedule F,
no party to any BTATC Spectrum Lease has claimed, and to the Knowledge of
Transferors, no party has threatened, in any written statement to any Transferor
that such party has a right to terminate the BTATC Spectrum Lease prior to or at
the Closing or to seek damages against any Transferor for the violation, breach
or default by any Transferor of such BTATC Spectrum Lease.
(m) Except as set forth on Schedule G, to the Knowledge of Transferors:
(i) the grant, renewal or assignment of the FCC licenses subject to the BTATC
Spectrum Leases (the "LEASED FCC LICENSES") to the existing licensee thereof was
approved by the FCC by Final Order; (ii) the Leased FCC Licenses are validly
issued and in full force and effect; and (iii) there is no Proceeding pending
before the FCC or threatened, which, if determined as requested by the moving
party or as indicated in any document initiating such Proceeding, could result
in the revocation, modification, restriction, cancellation, termination or
non-renewal of the Leased FCC Licenses or other action which is adverse to the
licensee or any of Transferor.
(n) Schedule H sets forth a true and complete list of all agreements
regarding the BTATC Licenses between any Transferor and any other MMDS licensee,
applicant, lessor or operator with respect to (i) interference to or from
adjacent markets or spectrum within any market affecting a BTATC License, (ii)
the coordination of adjacent market or in-market spectrum use, or (iii) other
matters concerned with the operation of channels in adjacent markets or in the
same market or agreements for the partitioning of any BTA that is the subject of
a BTATC License that is a BTA authorization. Transferors have delivered to
Acquiror true complete copies of all such agreements.
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(o) Schedule I sets forth, to the Knowledge of Transferors, a true and
complete list of all agreements regarding Leased FCC Licenses between a
Transferor or the licensee of such license and any other MMDS, MDS or ITFS
licensee, applicant, lessor or operator with respect to (i) interference to or
from adjacent markets or spectrum within any Market affecting a Leased FCC
License, (ii) the coordination of adjacent market or in-market spectrum use, or
(iii) other matters concerned with the operation of channels in adjacent markets
or in the same market or agreements for the partitioning of any BTA that is the
subject of a Leased FCC License that is a BTA authorization. Transferors have
delivered to Acquiror true and complete copies of all such agreements.
(p) Each of the Channel Listing and the Update delivered under Section 4
was true, correct and complete when delivered, and any additional information
through the date of the Closing that would have been part of the Channel Listing
or the Update had it been delivered at the Closing has been provided to
Acquiror.
(q) The Asset Listing relating to the Closing was true, correct and
complete when delivered, and any additional information through the date of the
Closing that would have been part of the Asset Listing had it been delivered at
the Closing has been provided to Acquiror.
(r) Each transmission tower owned by Transferor included in the Related
Assets that is being transferred as contemplated by Section 7.10(a) ("OWNED
TOWER") is being conveyed to Acquiror free and clear of any encumbrance that
would interfere with the use of the tower as presently used by Transferor.
Transferor has delivered to Acquiror true, correct and complete copies of any
agreements with third Persons relating to an Owned Tower. Transferor has
delivered to Acquiror true, correct and complete copies of each agreement (the
"TOWER LEASES") giving Transferor a right to use a tower that is not an Owned
Tower that is identified on the Asset Listing. Each of the Tower Leases is
valid, binding and in full force and effect. Transferor has not and is not and,
to the knowledge of Transferor, no other party to a Tower Lease has failed to
comply with or is in breach or default thereunder, except for such
non-compliance, breach or default that could not reasonably be expected to have
a material adverse effect on Transferor's right to use the tower as presently
used. Each Owned Tower is obstruction-marked and lighted to the extent required
by, and in accordance with, the rules and the regulations of the Federal
Aviation Administration and the FCC.
(s) Transferor has all licenses, permits, certificates, approvals,
registrations and other authorizations required from any Governmental Agency in
connection with the ownership and operation of any business conducted using the
BTATC Licenses and BTATC Spectrum Leases as currently conducted by Transferor
(collectively, "PERMITS") Transferor is not in material violation of any
Permit. For the avoidance of doubt, Permit does not include any FCC License.
(t) Schedule J identifies each maintenance agreement or other contract
providing for the maintenance, repair, servicing or other services obtained from
or due to third Persons with respect to any Related Assets. Transferor has
delivered true, correct and complete copies of each such agreement to Acquiror.
To the knowledge of Transferor, there is no material default by any party under
an agreement identified on Schedule N.
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(u) Transferor's use or operation of the Related Assets to be transferred
at the Closing is in compliance with applicable Environmental Laws in all
material respects. There are no pending or, to the knowledge of Transferor,
threatened actions by or before any Governmental Authority alleging that the use
or operation of the Related Assets to be transferred at the Closing by
Transferor is not in compliance with applicable Environmental Laws. Transferor
holds and is in compliance in all material respects with all Permits required
under Environmental Laws for the operations of the Related Assets to be
transferred at the Closing.
(v) All physical assets identified on the Asset Listing that will be
transferred to Acquiror as contemplated by Section 7.10(a) are sold AS IS, WHERE
IS, AND WITH ALL FAULTS.
7.7 PRE-CLOSING DELIVERIES; POST-CLOSING ADJUSTMENTS; SUBSEQUENT CLOSINGS;
FURTHER ASSURANCES.
(a) Not more than 30 days and not less than 10 days before the scheduled
date of any Closing, each Transferor will deliver to each Acquiror the Schedules
described in Section 7.6 that would be delivered by Transferor if the Closing
were occurring on the date of delivery and indicating any facts or circumstances
that are expected to change prior to the Closing. Unless the Acquiror agrees
otherwise, the Schedules so delivered will be updated by Transferor not less
than 5 days before the Closing. The final schedules required by Section 7,6 will
be delivered at Closing (the "CLOSING DATE SCHEDULES").
(b) For the initial Closing (and any subsequent Closings), not more than
60 days after the Closing or any subsequent Closing, the Transferor will submit
an invoice showing in reasonable detail (i) the Carrying Costs incurred for each
channel transferred at that Closing during the period from the date of the
statement that was the basis for the Carrying Costs reimbursed at that Closing
through the date of the Closing, and (ii) for a Closing pursuant to Section 4,
Deal Related Expenses that were incurred in the period immediately preceding the
Closing. Not more than 30 days after receiving the invoice, the Acquiror will
pay the invoice. If there is a dispute whether the amounts on the invoice are
proper, the amount not in dispute will be paid and, not sooner than 30 days
after giving notice that it will exercise that right if the parties do not
agree, either party can initiate arbitration under Section 11.1.
(c) For a period of 180 days after the initial Closing, the parties will
continue to comply with Section 8.1 (b) and (d) to obtain any governmental
consent or approval or Third Party Consents that are required to accomplish any
transfer that could not occur at the initial Closing because such consents or
approvals had not yet been obtained. During this 180-day period, the parties
will cooperate, at the expense of the Acquiror, in any reasonable arrangement
designed to provide Acquiror with the benefit of any tangible asset or other
right for which the parties are seeking the necessary consent or approval to
make a transfer. After the 180-day period, at the request and expense of
Acquiror, the parties will cooperate in any reasonable arrangement designed to
provide the Acquiror with the benefit of any tangible asset or other right which
might have been transferred under this Amendment.
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(d) Acquiror on the one hand and each Transferor on the other hand will
execute and deliver any instruments and take any action as the other may
reasonably request in order to evidence or complete the transactions to be
effected at a Closing.
7.8 CLAIMS FOR BREACH.
(a) Any claim for breach of a representation or warranty must be made by
notice to the breaching party not more than 365 days after the Closing (or, with
respect to assets or other rights transferred at a subsequent Closing, 365 days
after the subsequent Closing) at which the breach occurred. Any claim must be in
writing, must identify in reasonable detail the breach claimed and, to the
extent known, the facts and circumstances giving rise to the claim. Investor and
any COM Entity that requires a license or other right to use spectrum or Related
Assets under this Agreement are jointly and severally liable for any claim made
by the Company for breach of a representation or warranty by Investor or any
other COM Entity. If a claim is made for breach of a representation or warranty,
then not sooner than 60 days after giving notice that it will exercise its right
to do so if the claim is not resolved, the party making the claim can initiate
arbitration under Section 11.1.
(b) NO PARTY TO THIS AGREEMENT IS ENTITLED TO SEEK OR RECOVER
CONSEQUENTIAL, PUNITIVE OR EXEMPLARY DAMAGES. CONSEQUENTIAL DAMAGES ARE, WITHOUT
LIMITATION, LOST PROFITS, LOST REVENUE, AND THE LIKE.
7.9 TAXES.
(a) All Transfer Taxes arising out of any transfer effected at any
Closing, under Article 7, and any Transfer Taxes required to effect any
recording or filing with respect thereto, will be paid by the Company. If an
exemption is potentially available, a COM Entity wall cooperate with any
reasonable request of the Company to obtain an appropriate resale exemption
certificate or other evidence to entitle the Company to claim the exemption.
(b) The Company will pay all gross receipts and income tax due on gain
recognized by Individual, Investor and any COM Entity on an exchange
accomplished under Section 5. If, in the three year period following the
exchange under Section 5, a COM Entity sells or exchanges the channels or other
assets or rights received in the exchange in a taxable transaction (as
determined under the Internal Revenue Code), then, not more than 10 days after
closing of the subsequent sale or exchange, the COM Entity will pay the Company
an amount equal to: (i) the tax paid under this Section 7.9(b) with respect to
the assets that were exchanged for the assets that were subsequently sold or
exchanged; plus (ii) interest on that amount from the date the Company paid the
tax to the date that the COM Entity reimburses the Company at a rate equal to
the Company's cost of funds on the date the Company paid the tax.
8. COVENANTS.
8.1 COVENANTS.
(a) Investor, Individual, or their Controlled Affiliates will disclose, to
the extent required, the terms of this Amendment in connection with any filings
related to the transfer to
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them of MMDS Spectrum. If any information about the Nextel Group is required in
connection with any such filing, the Company will cause required information to
be provided to Investor.
(b) From the date hereof to and including the last Closing to occur under
Section 7, the Company, Investor and Individual will (and will cause their
respective Affiliates, if appropriate, to) (i) cooperate with each other in the
preparation and filing of all forms, notifications, reports and information,
required or reasonably considered advisable by any of them pursuant to any Law
(including, without limitation, the Communications Act and the HSR Act); (ii)
use all commercially reasonable efforts to furnish or cause to be furnished, as
promptly as practicable; all information and documents requested under such
Laws; and (iii) use all commercially reasonable efforts to agree on a method to
overcome any objections by any Governmental Authority to any transaction
contemplated hereby.
(c) When negotiating leases for MMDS Spectrum or Related Assets,
Individual will cause COM Entities to use all commercially reasonable efforts,
and will use commercially reasonable efforts to cause any of their Affiliates
that are negotiating such leases, to have the right to assign such lease
pursuant to this Amendment without the need for any consent by the lessor or any
other third Person.
(d) From the date hereof to and including the last Closing to occur under
Section 7, Investor, the Company and Individual will (and will cause their
respective Affiliates, if appropriate, to) use commercially reasonable efforts
to obtain any Third Party Consents as promptly as practicable. If any third
Person proposes to condition its consent on any amendment or modification to any
agreement or other consideration, the proposed Transferor will promptly notify
the proposed Acquiror. The decision whether to make the amendment or
modification and/or to deliver any consideration will be made by the Acquiror
whose consent will not be unreasonably withheld or delayed.
(e) Individual will use his reasonable best efforts to cause Investor and
his and its Controlled Affiliates to comply with this Amendment.
(f) To the extent the Company assigns any of its rights under this
Amendment to an Affiliate, the Company will use its reasonable best efforts to
cause the Affiliate to comply with this Amendment.
(g) Investor and Individual will use their reasonable best efforts not to
become subject to, and not to permit any COM Entity to become subject to, any
confidentiality or nondisclosure obligations that would limit its ability to
make the disclosures required by this Amendment, and, if such obligations
nonetheless arise, each will use its reasonable best efforts to obtain a waiver
or consent that will permit it to make the disclosures required by this
Amendment.
(h) So long as Investor has any obligations under this Amendment,
Individual will retain control of Investor.
(i) In exercising its rights under Section 5 the Company will use its
reasonable best efforts to minimize and mitigate any damage to the existing or
planned business of a COM Entity. If, nonetheless, there is a material adverse
affect on such business, the Company will pay
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the affected COM Entity reasonable compensation in an amount agreed by the
parties. For purposes of this Section 8.1(i), "planned" business means that the
relevant COM Entity can show it would reasonably be expected to launch
commercial service in the 180-day period after the date the Company gives notice
it will exercise-swap rights under Section 5.
9. REPRESENTATIONS AND WARRANTIES.
9.1 BY INVESTOR. Investor hereby represents and warrants to the company
that:
(a) Investor is a limited liability company duly organized, validly
existing and in good standing under the laws of the state of Washington and has
all requisite limited liability company power and authority to carry on its
business as now conducted, and to enter into and to perform this agreement.
(b) Investor has taken all necessary action to authorize the execution,
delivery and performance of this Amendment. This Amendment has been duly
executed and delivered by Investor and is a valid and binding agreement of
Investor enforceable against Investor in accordance with its terms, except as
may be limited by applicable bankruptcy, insolvency, reorganization, moratorium
and other similar Laws of general application which may affect the enforcement
of creditors' rights generally and by general equitable principles.
(c) The execution, delivery, and performance of this Amendment and the
consummation of the transactions contemplated hereby will not result in any
violation of, conflict with, constitute a default (with or without notice or
lapse of time) under, or give rise to a right of termination, cancellation,
acceleration of, or the imposition of any lien, claim, or encumbrance under, or
require any consent under or require a payment by Investor to any other Person
pursuant to (i) the limited liability company agreement or other organizational
documents of Investor, (ii) any note, bond, debt instrument, mortgage, indenture
or other agreement or instrument to which any COM Entity is a party, or (iii)
any Law or Order by which any COM Entity is bound.
9.2 BY INDIVIDUAL. Individual represents and warrants to the Company that:
(a) He is a resident of the State of Washington and is authorized to
execute, deliver and perform this Amendment.
(b) He has duly executed and delivered this Amendment and it is a valid
and binding agreement of Individual enforceable against Individual in accordance
with its terms, except as may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium and other similar Laws of general application which
may affect the enforcement of creditors' rights generally and by general
equitable principles.
(c) The execution, delivery, and performance of this Amendment and the
consummation of the transactions contemplated hereby will not result in any
violation of, conflict with, constitute a default (with or without notice or
lapse of time) under, or give rise to a right of termination, cancellation,
acceleration of, or the imposition of any lien, claim, or encumbrance under, or
require any consent under or require a payment by Individual to any other Person
pursuant to (i) any note, bond, debt instrument, mortgage, indenture or other
agreement or
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instrument to which Individual or any COM Entity is a party, or (ii) any Law or
Order by which Individual or any COM Entity is bound.
(d) Individual controls Investor.
9.3 BY THE COMPANY. The Company hereby represents and warrants to Investor
and Individual that:
(a) The Company is a corporation duly organized, validly existing and in
good standing under the laws of the state of Delaware and has all requisite
corporate power and authority to carry on its business as now conducted, and to
enter into and to perform this Agreement.
(b) The Company has taken all necessary corporate action to authorize the
execution, delivery and performance of this Amendment. This Amendment has been
duly executed and delivered by the Company and is a valid and binding agreement
of the Company enforceable against the Company in accordance with its terms,
except as may be limited by applicable bankruptcy, insolvency, reorganization,
moratorium and other similar Laws of general application which may affect the
enforcement of creditors' rights generally and by general equitable principles.
(c) The execution, delivery, and performance of this Amendment and the
consummation of the transactions contemplated hereby will not result in any
violation of, conflict with, constitute a default (with or without notice or
lapse of time) under, or give rise to a right of termination, cancellation,
acceleration of, or the imposition of any lien, claim, or encumbrance under, or
require any consent under or require a payment by the Company to any other
Person pursuant to (i) the certificate of incorporation, by laws or other
organizational documents of the Company, (ii) any note, bond, debt instrument,
mortgage, indenture or other agreement or instrument to which any member of the
Nextel Group is a party, or (iii) any Law or Order by which any member of the
Nextel Group is bound.
10. DEFINITIONAL PROVISIONS.
10.1 DEFINITIONS.
"ACQUIROR" means, for any closing under Article 7, any Person that is
buying, exchanging, assuming or otherwise acquiring a license or spectrum lease
as a result of the transactions being consummated at that Closing, but only in
that capacity, and does not mean that Person in its capacity as a Transferor (if
applicable) at that Closing.
"ACQUISITION AGREEMENT" -- see Section 3.
"AFFILIATE" means, as to any Person, another Person that directly or
indirectly through one or more intermediaries, controls, or is controlled by, or
is under common control with, such Person. For the purposes of this definition,
"CONTROL" when used with respect to any Person, means the possession, directly
or indirectly, of the power to direct or cause the direction of the management
and policies of such Person, whether through the ownership of voting securities,
by contract or otherwise; the terms "CONTROLLING" and "CONTROLLED" have meanings
correlative to
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the foregoing. The term "Controlled Affiliate" as used herein includes
Individual and any Affiliate of COM that is, at the relevant time, controlled
xxx COM.
"AMENDMENT" - see Preamble.
"ANNUAL FCC REPORTS" means those reports, filings, notices and regulatory
fees required to be filed annually with the FCC by licensees, permittees,
conditional licensees and operators, including reports required by Sections
21.11(a), 21.911, 21.307(d) and 21.920 of Title 47 of the Code of Federal
Regulations, as such reports, filings, notices and regulatory fees may
be amended or supplemented from time to time.
"ARBITRATION RULES" -- see Section 11.1(a).
"ASSET LISTING" -- see Section 4.2(b).
"BTA" means Basic Trading Area.
"BTATC LICENSE" or "BTATC SPECTRUM LEASE" means, with respect to any
Closing to occur pursuant to this Agreement, an FCC license to be transferred at
that Closing or a spectrum lease that, if Third Party Consents are obtained, is
to be transferred at that Closing.
"CALL NOTICE" -- see section 4.3(a).
"CARRYING COSTS" for any channel means out of pocket costs incurred in the
ordinary course of business by the entity transferring the channel during the
period it owned or had the use of the channel, including, without limitation,
site installation expense, real or personal property taxes associated with site
leases and other Related Assets that are being transferred, lease payments for
channels under spectrum leases, lease payments under site leases, maintenance
and monitoring costs, site utility costs, but specifically excluding, salaries
and employee costs, any allocation of overhead, professional fees associated
with any acquisition, and expenses for equipment and software.
"CHANNEL LISTING" -- see Section 4.1(a).
"CLOSING" means the consummation of a transaction under Article 7 as
contemplated by this Agreement.
"CLOSING DATE SCHEDULES" -- see Section 7.7(a).
"COM ENTITY" -- see Section 2(a).
"COMMUNICATIONS ACT" means the communications Act of 1934, as amended and
the rules and regulations promulgated thereunder.
"CONSTRUCTED FACILITIES" -- see Section 7.6(h).
"DEAL EXPENSES" means, for any BTATC License, BTATC Spectrum Lease or
Related Assets the reasonable, out-of-pocket expenses paid by a COM Entity to
unaffiliated, third-party,
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independent legal counsel, brokers and other advisors in connection with (i)
acquiring such rights or assets that are being transferred under Sections 3 or
4; or (ii) in connection with effecting a transfer of the rights or assets to a
Nextel Group member under Sections 3,4, 5, or 6 this Amendment; but deal
expenses do not include the expenses incurred to obtain the Six Retained
Channels or any expenses related to any interpretation, disputes or arbitration
under this Amendment. Any allocation of deal expenses to the Six Retained
Channels will be agreed between the parties and, if they cannot agree, not
sooner than 30 days after giving notice that it will exercise that right if the
parties do not agree, either party can initiate arbitration under Section 11.1.
"ENVIRONMENTAL LAWS" means any law relating to the protection,
preservation or restoration of the environment (including air, water, vapor,
surface water, groundwater, drinking water supply, surface land, subsurface
land, plant and animal life or any other natural resource), or to human health
or safety as it relates to the environment, including any applicable provisions
of the Comprehensive Environmental Response, Compensation and Liability Act, 42
U.S.C. Section 9601 et seq., the Hazardous Materials Transportation Act, 49
U.S.C. Section 1801 et seq., the Resource Conservation and Recovery Act, 42
U.S.C. Section 6901 et seq., the Clean Water Act, 33 U.S.C. Section 1251 et
seq., the Clean Air Act, 33 U.S.C. Section 2601 et seq., the Toxic Substances
Control Act, 15 U.S.C. Section 2601 et seq., the Federal Insecticide, Fungicide,
and Rodenticide Act, 7 U.S.C. Section 136 et seq., and the Oil Pollution Act of
1990, 33 U.S.C. Section 2701 et seq., and the regulations promulgated pursuant
thereto, and all analogous state or local statutes.
"FCC" means the Federal Communications Commission.
"FINAL ORDER" means an action by the FCC (i) which action has not been
reversed, stayed, enjoined, set aside, annulled or suspended, (ii) in relation
to which no request for stay, motion or petition for reconsideration or
rehearing, application or request for review, or notice of appeal or other
administrative or judicial petition for review (collectively, an "Appeal") is
pending, and (iii) as to which the prescribed time for filing an Appeal, and for
the entry of orders staying, reconsidering, or reviewing on the FCC's or such
other regulatory authority's own motion has expired.
"GOVERNMENTAL AUTHORITY" means any governmental or political subdivision
or department thereof, any governmental or regulatory body, commission, board,
bureau, agency or instrumentality, or any court or arbitrator or alternative
dispute resolution body, in each case whether domestic or foreign, federal,
state or local.
"HSR ACT" means the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976,
as amended and the rules promulgated thereunder.
"ITFS" means Institutional Television Fixed Service, a class of microwave
frequencies licensed by the FCC pursuant to part 74 of Title 47 of the Code of
Federal Regulations, as amended and interpreted by the FCC.
"KNOWLEDGE OF ACQUIROR" means the actual knowledge, without any
independent investigation or inquiry, of the officers of the Acquiror.
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"KNOWLEDGE OF TRANSFERORS" means the actual knowledge, without any
independent investigation or inquiry, of the officers of the Transferors.
"LAW" means any domestic or foreign, federal, state or local law, statute,
ordinance, rule or regulation.
"LEASE PARTY" -- see Section 4.2(e).
"LEASED" means that a Person has been given the right to use a channel
licensed to another Person, and a "lease" means a channel lease or any other
agreement that entitles a Person to use a channel licensed to another Person.
"LEASED FCC LICENSES" -- see Section 7.6(m).
"MMDS" means Multichannel Multipoint Distribution Service, a domestic
transmission service licensed by the FCC pursuant to Part 21 of Title 47 of the
Code of Federal Regulations, as mended and interpreted by the FCC.
"MMDS SPECTRUM" means any license or lease for MMDS or ITFS channels.
"MARCH AGREEMENT" -- see Preamble.
"NEXTEL GROUP" means the Company and the entities controlled, directly or
indirectly, by the Company.
"OFFER NOTICE" -- see Section 6(a).
"OFFER TERMS" -- see Section 6(a).
"OWNED TOWERS" -- see Section 7.6(r).
"PERMITS" -- see Section 7.6(s).
"PERSON" means an individual, partnership, corporation, limited liability
company, business trust, joint stock company, trust, unincorporated association,
joint venture, Governmental Authority or other, entity of whatever nature or a
group, including without limitation any pension, profit sharing or other benefit
plan or trust.
"PROCEEDING" means any action, arbitration, audit, hearing, complaint,
inquiry, investigation, litigation, or suit (whether civil, criminal,
administrative, investigative, or informal) commenced, brought, conducted, or
heard by or before, or otherwise involving, any Governmental Authority or
arbitrator.
"RELATED ASSETS" -- see Section 4.2(a).
"SECTION 3 NOTICE" -- see Section 3.
"SIX RETAINED CHANNELS" -- see Section 2.1(b).
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"THIRD PARTY CONSENTS" -- means any consent or approval from a third
Person (other than a Governmental Authority) that is required under the terms of
a spectrum lease, site lease or other agreement that is contemplated to be
assigned under this Agreement.
"TOWER LEASES" -- see Section 7.6(r).
"TRANSFER TAX" means any Federal, state, county, local or other sales,
use, transfer, conveyance, documentary transfer, recording or other similar tax,
fee or charge imposed upon the sale, transfer, exchange, or assignment of
property or any interest therein or the recording thereof, and any penalty,
addition to, or interest with respect thereto (but excluding any taxes on gains
or income).
"TRANSFEROR" means, for any Closing under Article 7, any Person that is
selling, exchanging, assigning or otherwise transferring a license or lease as
a result of the transactions being consummated at that Closing, but only in that
capacity, and does not mean that Person in its capacity as an Acquiror (if
applicable) at that Closing.
"UPDATE" -- see Section 4.1(b).
"USE AND ACCESS AGREEMENT" -- see Section 4.2(a).
10.2 OTHER DEFINITIONAL PROVISIONS.
(a) All terms defined in this Agreement have the defined meanings when
used in any certificate, report or other documents made or delivered pursuant
hereto or thereto, unless the context otherwise requires.
(b) Terms defined in the singular have a comparable meaning when used in
the plural, and vice versa.
(c) As used herein, the neuter gender also denotes the masculine and
feminine, and the masculine gender also denotes the neuter and feminine, where
the context so permits.
(d) The words "include," "including" and "or" mean without limitation by
reason of enumeration.
11. GENERAL.
11.1 ARBITRATION.
(a) If a party or a COM Entity that is a Transferor or Acquirer, or a
member of the Nextel Group that is a Transferor or Acquiror desires to initiate
arbitration in connection with a dispute under this Amendment then it will
initiate binding arbitration proceedings for the matter to be resolved finally
by arbitration under the Center for Public Resources Non-Administered
Arbitration Rules ("Arbitration Rules"), which Rules are deemed to be
incorporated by reference into this Section 11.1.
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(b) The arbitrator will be chosen, and the proceedings conducted, in
general accordance with the Arbitration Rules; except that: (i) the parties to
the dispute will chose one arbitrator through a self-administered process of
striking names from a list of potential arbitrators and will not use the methods
provided for in the Arbitration Rules; (ii) the rules of evidence employed in
the federal courts at the time will apply; and (iii) discovery will be permitted
in accordance with the Federal Rules of Civil Procedure.
(c) The place of the arbitration will be Chicago, Illinois.
(d) If any provision of this Amendment provides that a Person can initiate
arbitration to resolve any matter in dispute, then no party, no COM Entity and
no member of the Nextel Group can initiate any legal proceeding relating to the
matter in dispute, but must proceed under this Section 11.1.
11.2. PUBLIC ANNOUNCEMENTS. Except as required by Law, the exercise of
fiduciary duty or the policies or rates of any stock exchange (or the Nasdaq
National Market) on which the Company's securities are listed, the form and
content of all press releases or other public communications of any sort
relating to the subject matter of this Amendment, and the method of their
release, or publication thereof by any of the parties hereto or their respective
Affiliates, shall be subject to the prior approval of Investor and the Company,
which approval shall not be unreasonably withheld or delayed.
11.3 NOTICES. All notices, demands, requests, certificates or other
communications under this Amendment shall be in writing and shall be deemed to
have been duly given when (i) hand delivered, (ii) sent by facsimile
transmission, (iii) one day after sent by commercial courier guaranteeing next
business day delivery or (iv) five days after posting in the United States mail
having been sent by registered or certified mail return receipt requested,
addressed as follows:
(i) if to the Company:
Nexiel Communications, Inc.
0000 Xxxxxx Xxxxxx Xxxxx
Xxxxxx, XX 00000
Attention: Xxxx Xxxxxxxxx
Facsimile: (000) 000-0000
with a copy to:
Nextel Communications, Inc.
0000 Xxxxxx Xxxxxx Xxxxx
Xxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxxx, General Counsel
Facsimile: (000) 000-0000
(ii) if to Investor or Individual:
Eagle River, Inc.
0000 Xxxxxxxx Xxxxx
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Xxxxxxxx, XX 00000
Attention: Xxxxx X. XxXxx
Facsimile: (000) 000-0000
with a copy to:
Xxxxx Xxxxxx Xxxxxxxx
0000 XX Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxx, XX 00000-0000
Attention: Xxxxxxxx Xxxxx
Facsimile: (000) 000-0000
Any communication delivered after business hours or on a Saturday, Sunday or
legal holiday at the place designated in such delivery shall be deemed for
purposes of computing any time period hereunder to have been delivered on the
next business day.
11.4 EXPENSES. Each party shall bear its own expenses, including the fees
and expenses of any attorneys, accountants, investment bankers, brokers, finders
or other intermediaries or other Persons engaged by it, incurred in connection
with this Amendment, its interpretation and any disputes or arbitrations under
this Amendment.
11.5 BENEFITS; ASSIGNMENT. The provisions of this Amendment shall be
binding upon, and inure to the benefit of, the parties and their respective
successors and permitted assigns. Nothing in this Amendment, express or implied,
is intended to confer upon any Person other than the parties and their
respective successors and permitted assigns any rights, remedies or obligations
under or by reason of this Amendment. The Company may assign some or all of its
rights or obligations under this Amendment to any member of the Nextel Group.
Except as stated in the preceding sentence, no party to this Amendment may
assign its rights or obligations under this Amendment without the prior written
consent of the other parties.
11.6 ENTIRE AGREEMENT; AMENDMENT AND WAIVER. This Amendment is the entire
agreement between the parties with respect to the subject matter hereof and
supersedes all prior agreements and understandings, both written and oral, with
respect to the subject matter hereof and thereof including, without limitation;
the term sheet between the Company and FLUX Holdings, LLC regarding, among
other things the WorldCom WBS Spectrum (as defined therein). This Amendment may
not be amended, supplemented or otherwise modified except by an instrument in
writing signed by each of the parties hereto. No waiver by either party hereto
of any of the provisions hereof shall be effective unless explicitly set forth
in writing and executed by such party. Any waiver by a party of a breach of this
Amendment shall not operate or be construed as a waiver of any subsequent
breach.
11.7 HEADINGS. The headings in this Amendment are for convenience only and
shall not affect the construction hereof.
11.8 GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE INTERNAL LAWS OF THE
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COMMONWEALTH OF VIRGINIA WITHOUT GIVING EFFECT TO ANY CONFLICTS OF LAW
PRINCIPLES OF SUCH STATE.
11.9 SEVERABILITY. In the event that any provision of this Amendment is
deemed invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.
11.10 COUNTERPARTS. This Amendment may be executed in one or more
counterparts, each of which shall be deemed an original, and it shall not be
necessary in making proof of this Amendment to produce or account for more than
one such counterpart.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed and delivered to be effective as of the day and year first above
written.
NEXTEL COMMUNICATION, INC.
By: /s/ XXX XXXXXXX
_________________________________
Name: XXX XXXXXXX
_________________________________
Title: CEO
_________________________________
DIGITAL RADIO, L.L.C.
By: /s/ XXXXX XXXXXXXX
---------------------------------
Name: XXXXX XXXXXXXX
Title: VP Eagle River Investments LLC
Its Manager
/s/ XXXXX X. XxXXX
-----------------------------------------
XXXXX X. XxXXX, for his sole and separate
estate
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