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EXHIBIT 10.6(a)
ASSET PURCHASE AGREEMENT
This ASSET PURCHASE AGREEMENT (this "Agreement") is made and entered
into as of this 26th day of June, 1996, by and between Digital Television
Services of New York II, LP, a Georgia Limited Partnership ("Purchaser"), Falls
Earth Station, Inc. a New York corporation ("Seller") and Xxxxxx X. Xxxxxx, a
resident of the State of New York (the "Owner").
RECITALS
1. Seller owns and operates an exclusive distributorship of the
National Rural Telecommunications Cooperative's DBS Services and of DirecTV,
Inc., as successor to Xxxxxx Communications Galaxy, Inc. (the "Business") within
those counties designated under the NRTC/Member Agreement for Marketing and
Distribution of Services dated March 4, 1993, as amended (the "Locations").
2. The Owner owns all of the issued and outstanding stock of all
classes of Seller.
3. Purchaser desires to acquire from Seller, and Seller desires to sell
to Purchaser all of Seller's rights under the NRTC/Member Agreement and the
NRTC/Retail Agreement relating to the Locations and certain of the assets used
in the Business, subject to the terms and conditions of this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and agreements
hereinafter set forth, and for other good and valuable consideration, the
receipt and legal sufficiency of which is hereby acknowledged, Seller, Owner and
Purchaser hereby agree as follows:
ARTICLE I
DEFINITIONS
The terms defined in this Article shall have the following respective
meanings for all purposes of this Agreement, and the following definitions are
equally applicable to both the singular and plural forms of the terms defined:
"Accounts Payable" shall mean all accounts payable of Seller to the
NRTC as of the Closing Date relating to the Business.
"Accounts Receivable" shall mean all of the accounts receivable of
Seller as of the Closing Date for all Customers which are listed on Report 19A
(Accounts Receivable Summary) of the NRTC Central Billing Systems Reports.
"Cable Programming" shall have the meaning ascribed to such term in the
NRTC/Member Agreement.
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"Cash" shall mean all cash on hand and in Seller's bank accounts at
Huntington Bank as of the Closing Date, as determined in accordance with GAAP.
"Closing" shall mean the consummation and effectuation of the
transactions contemplated herein pursuant to the terms and conditions of this
Agreement and shall be held at 10:00 a.m. at the offices of Xxxxxx Xxxxxxx Xxxxx
& Xxxxxxxxxxx, L.L.P., 000 Xxxxx Xxxxx Xxxxxx, Xxxxx 0000, Xxxxxxxxx, Xxxxx
Xxxxxxxx, 00000 (i) at Purchaser's election, on (a) the last business day of the
month in which all of the conditions precedent set forth in Articles VIII and IX
herein have been satisfied or waived, or (b) on the calendar day of such month
on which NRTC's accounting period closes, or (ii) such other date or at such
other time or place (including via mail overnight courier) as the parties may
mutually agree upon in writing. The Closing shall be as effective as of the
close of business on the Closing Date.
"Closing Date" shall mean the date on which the Closing actually
occurs.
"Commercial Establishment" shall have the meaning ascribed to such term
in the NRTC/Member Agreement.
"Committed Member Residence" shall have the meaning ascribed to such
term in the NRTC/Member Agreement.
"Current Assets" shall mean Cash, Accounts Receivable, Prepaid
Expenses, Leased Subscriber Equipment and Inventory of Seller which will be
acquired by Purchaser at Closing.
"Current Liabilities" shall mean Accounts Payables and Unearned Revenue
of Seller which will be assumed by Purchaser at Closing.
"Customers" shall mean those Persons, including Subscribers, which have
purchased telecommunications services, or entered into a binding agreement to
purchase telecommunications and related services, from Seller at any time during
the five (5) year period immediately preceding the Closing Date.
"DBS Services" shall have the meaning ascribed to such term in the
NRTC/Member Agreement.
"DirecTV" shall mean DirecTV, Inc., a California corporation, the
successor in interest and rights holder to Xxxxxx Communication Galaxy, Inc.
"Fixed Assets" shall mean the equipment and other tangible assets,
including, without limitation, the Leased Subscriber Equipment and any MTE
terminals and demonstration units owned by Seller and used or useable in
connection with the Business, which equipment and tangible assets are listed on
Schedule 1.1 attached hereto.
"GAAP" shall mean generally accepted accounting principles consistently
applied.
"Inventory" shall mean any DSS(TM) subscriber equipment of Seller which
the Purchaser notified the Seller pursuant to Section 4.3(b) hereof it desires
to purchase pursuant to this
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Agreement, which Inventory shall be valued at the lesser of (i) each item's
current wholesale cost and (ii) each item's original cost.
"Leased Subscriber Equipment" shall mean all DSS(TM) subscriber
equipment of Seller which is leased to Subscribers, which equipment shall be
valued at its net book value, but in no event shall the aggregate value
attributable thereto exceed Seventy Thousand Dollars ($70,000).
"Lien" shall mean with respect to any property or asset, any mortgage,
lien, pledge, charge, security interest, encumbrance, claim, escrow, right of
first refusal, indenture, easement, license or other adverse claim or
restriction of any kind in respect of such property or asset. For purposes of
this Agreement, any restriction or limitation with respect to a security or
other ownership interest (including any restriction on the right to vote, sell
or otherwise dispose of such security or ownership interest) shall constitute a
"Lien" thereon. For the purposes of this Agreement, a Person shall be deemed to
own subject to a Lien any property or asset which it has acquired or holds
subject to the interest of a vendor or lessor under any conditional sale
relating to such property or asset.
"Mini-Cable Business" shall mean the mini-cable systems business of
Seller operated on college campuses.
"Non-Select Services" shall have the meaning ascribed to such term in
the NRTC/Member Agreement.
"NRTC" shall mean the National Rural Telecommunications Cooperative, a
District of Columbia corporation.
"NRTC Agreements" shall mean the NRTC/Member Agreement, the NRTC/Retail
Agreement, and any Other Assumed Agreements.
"NRTC/Member Agreement" shall mean the NRTC/Member Agreement for
Marketing and Distribution of DBS Services dated March 4, 1993, by and between
the NRTC and Seller, as amended from time to time, together with all schedules
and exhibits thereto, a copy of which is attached hereto as Schedule 1.2.
"NRTC/Retail Agreement" shall mean the NRTC/Member DBS Product Retail
Agreement by and between the NRTC and Seller dated October 8, 1993, as amended
from time to time, together with all schedules and exhibits thereto, a copy of
which is attached hereto as Schedule 1.3.
"Other Assumed Agreements" shall mean the contracts and agreements, if
any, set forth on Schedule 1.4, including any contracts and agreements with (i)
DirecTV and (ii) Customers with respect to the Leased Subscribers Equipment,
copies of which are attached to such Schedule.
"Person" shall mean an individual, corporation, partnership, limited
liability company, association, trust, unincorporated organization, joint
venture or other entity or organization including a government, political
subdivision or agency or instrumentality thereof.
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"Prepaid Expenses" shall mean all prepaid property taxes, prepaid
supplies, advances, deposits, deferred charges and other prepaid expenses (other
than prepaid insurance) shown on Seller's books and records as of the Closing
Date relating to the Business which Prepaid Expenses can be credited to
Purchaser's account after the Closing Date, as determined in accordance with
GAAP.
"Programming" shall mean Cable Programming and any programming provided
DirecTv pursuant to the NRTC Agreements.
"Purchase Price" shall mean the amount set forth in Section 4.1 herein.
"Purchased Assets" shall mean only the (i) NRTC Agreements, (ii)
Current Assets, (iii) relationships, contracts and accounts with Customers, (iv)
Fixed Assets, (v) Records and (vi) telephone numbers used in the Business, and
shall specifically exclude all assets relating to the Mini-Cable Business.
"Records" shall mean all files, books and records relating to the
provisions of DBS Services by Seller, including, without limitation, Customer
and prospective customer lists, computer programs, tapes and electronic data
processing software, accounting journals and ledgers, accounts receivable
records, and copies of all NRTC reports, correspondence and other documents
relating to the NRTC Agreements and Other Assumed Agreements and compliance
therewith.
"Subscriber" as of any date shall mean a Customer who, at a minimum,
(i) is an active subscriber subscribing to a package of basic services, (ii) on
the last day of the calendar month prior to such date, whose account is not more
than sixty (60) days past due from the date payment is due, (iii) who is not an
employee or agent of the service provider or charged a fee that is nominal
(e.g., demonstration unit) or substantially below the service provider's
published rates, and (iv) who has not given notice of intent to discontinue
service.
"Termination Date" shall mean September 26, 1996; provided, however, if
the NRTC has not given its consent contemplated in Section 7.3 hereof, then the
Termination Date shall be extended for an additional sixty (60) days.
"Unearned Revenue" shall mean all unearned revenue, advance payments
and deposits associated with Customer credit balances of Seller as of the
Closing Date which are listed on Report 17 (Unearned Revenue Report) of the NRTC
Central Billing System Reports.
ARTICLE II
SALE AND PURCHASE OF THE ASSETS
2.1. SALE AND PURCHASE OF ASSETS. Subject to the terms and conditions
of this Agreement, Seller shall sell, transfer, assign and convey the Purchased
Assets to Purchaser, and Purchaser shall purchase, acquire and accept from
Seller all of Seller's right, title and interest in and to the Purchased Assets,
free and clear of any and all Liens, on the Closing Date for the consideration
set forth in this Agreement. The sale, transfer, assignment and conveyance of
the
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Purchased Assets shall be made by the execution and delivery at Closing of (i)
an Assignment and Assumption Agreement substantially in the form attached hereto
as Schedule 2.1(a) (the "Assignment"), and (ii) a xxxx of sale substantially in
the form attached hereto as Schedule 2.1(b) (the "Xxxx of Sale"), and (iii) such
other recordable instruments of assignment, transfer and conveyance as Purchaser
shall reasonably request.
ARTICLE III
ASSUMPTION OF LIABILITIES/EXPRESS EXCLUSIONS
3.1. LIABILITIES OF SELLER. As of the Closing Date, Purchaser shall
assume and agree to pay, perform and otherwise discharge all obligations of
Seller with respect to the following:
(a) the NRTC Agreements to the extent the obligations therein
arise out of the provision of DBS Services to Customers and accrue on or after
the Closing Date; and
(b) all Current Liabilities as of the Closing Date.
Anything in this Agreement to the contrary notwithstanding,
except for the liabilities specifically set forth in this Section 3.1, Purchaser
shall not assume or be deemed to have assumed under this Agreement, by reason of
the transactions contemplated by this Agreement, or otherwise, any other trade
or other accounts payable, accrued expenses, debts, liabilities, obligations or
commitments of Seller of any nature whatsoever, known or unknown, and the
execution, delivery and performance of this Agreement shall not render Purchaser
liable for any such debt, liability, obligation or commitment.
By way of example and not as an exhaustive list, the following
liabilities and obligations of Seller are expressly not assumed by Purchaser,
pursuant to this Agreement or otherwise:
A. any liabilities or obligations of Seller under or with
respect to any employment agreement or any pension, profit-sharing, retirement,
disability or other benefit plan entered into or established by Seller with or
for the benefit of any employee of Seller; and
B. any liabilities or obligations of any kind arising out of
incidents, occurrences, actions or failures to act by or pertaining to Seller,
which occurred prior to the Closing Date, including, without limitation,
liabilities or obligations arising from (i) the distribution, sale or provision
of any services of Seller, or (ii) any failure or alleged failure to comply
with any federal, state or local law, rule or regulation applicable to Seller
or the Business.
Purchaser agrees to promptly notify Seller of any claims which Purchaser obtains
knowledge of which arise out of or result from liabilities of Seller not assumed
by Purchaser pursuant to this Agreement.
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ARTICLE IV
PURCHASE PRICE; PAYMENT OF PURCHASE PRICE
4.1. PAYMENT OF PURCHASE PRICE. The purchase price for the Purchased
Assets (the "Purchase Price") shall be One Million Four Hundred Sixty Thousand
Dollars ($1,460,000), subject to adjustment as provided in Section 4.3 herein.
4.2. PAYMENT OF PURCHASE PRICE. On the Closing Date, Purchaser shall
pay the Purchase Price to Seller as follows:
(a) The sum of Three Hundred Sixty Thousand Dollars
($360,000), subject to adjustment as provided for in Section 4.3 herein, by
certified or cashier's check, or by wire transfer of immediately available funds
to an account or accounts designated in writing by Seller (the "Closing
Payment").
(b) the sum of One Million One Hundred Thousand Dollars
($1,100,000) by the delivery of a Promissory Note substantially in the form
attached hereto as Schedule 4.2(b) (the "Note"), less any adjustments and
reductions as provided in Section 4.3 herein. The Note will be secured by all of
the assets of Purchaser pursuant to the Security Agreement substantially in the
form attached hereto as Schedule 4.2(c) (the "Security Agreement").
4.3. ADJUSTMENT TO PURCHASE PRICE.
(a) The Closing Payment shall be increased by the parties'
good faith estimate of the Current Assets of Seller and decreased by the Current
Liabilities of Seller as of the Closing Date (the "Closing Adjustment"), which
adjustment shall be subject to final adjustment as provided for in paragraph (c)
below.
(b) No later than thirty (30) days after the Closing Date, or
within three (3) days after receipt of the necessary accounting data from the
NRTC Central Billing System, whichever is later, Seller shall make and deliver
to Purchaser a balance sheet reflecting the Current Assets and Current
Liabilities of Seller as of the Closing Date (the "Closing Date Balance Sheet"),
prepared on a basis consistent with the "Pro Forma Accounting" attached hereto
as Schedule 4.3(b). For purposes of the Closing Adjustment and the Final Closing
Adjustment, the amount of Accounts Receivable of Seller to be included in the
Closing Date Balance Sheet shall include only Accounts Receivable of Subscribers
as reflected on Report 18A (Subscriber Accounts Receivable Aging by Account) of
the NRTC Central Billing System Reports less a reserve for Accounts Receivable
which are not collectible as determined in accordance with GAAP. Purchaser may,
by providing Seller with written notice at least five (5) days prior to the
Closing, elect to purchase all, or certain of, the DSS(TM) subscriber equipment
owned by Seller on the Closing Date; provided, however, Purchaser shall not have
the right to acquire any assets attributable to Seller's mini-cable systems
business operated on college campuses. Any such equipment which is purchased by
Purchaser shall be included as Inventory in the Closing Date Balance Sheet.
Except as set forth in this Section 4.4(b), no other assets or liabilities shall
be included in the Closing Date Balance Sheet. Seller shall make available
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to Purchaser such documentation, back-up, invoices, and books and records of
Seller as Purchaser may reasonably request.
(c) Seller and Purchaser shall negotiate in good faith to
reconcile any discrepancies which may arise in connection with the determination
of the Closing Date Balance Sheet. If Seller and Purchaser are unable to
reconcile such determination, Purchaser shall have fifteen (15) days from
presentment by Seller to notify Seller if Purchaser wishes to have Seller's
determination examined. If Purchaser elects to have Seller's determination
examined, it shall be submitted to the determination in Charlotte, North
Carolina, by the Certified Public Accounting firm of Xxxxxx Xxxxxxxx & Co., the
cost of such examination to be paid fifty percent (50%) by Seller and fifty
percent (50%) by Purchaser. The determination by Seller shall be final and
binding on the parties unless Purchaser elects to have an examination as
provided herein, in which case the results of the examination shall be made
within thirty (30) days of such referral, and shall be final and binding on the
parties (the "Final Closing Adjustment").
(d) To the extent the Final Closing Adjustment is less than
the Closing Adjustment, Seller shall (i) pay the difference in cash to Purchaser
within five (5) days after the final determination, or (ii) in the event of
nonpayment, Purchaser may exercise its Right of Offset pursuant to Section 10.5
hereof. In the event the Final Closing Adjustment is greater than the Closing
Adjustment, Purchaser shall immediately pay such excess to Seller by increasing
the next following payment(s) due under the Notes by such amount. If, following
any payment pursuant to this Section 4.3(d), an error (in billing or reporting
by NRTC or otherwise) is thereafter discovered which would have affected the
Final Closing Adjustment, the party in whose favor the error was made shall
immediately pay in cash the amount of such error to the other party.
4.4. ALLOCATION OF PURCHASE PRICE. The parties have agreed, after
arms-length negotiations, to allocate the Purchase Price among the Purchased
Assets on the basis set forth on Schedule 4.4 to be delivered at the Closing,
and the parties shall make all federal, state and local tax filings consistent
therewith.
ARTICLE V
SELLER'S AND OWNER'S REPRESENTATIONS AND WARRANTIES
To induce Purchaser to enter into this Agreement and to consummate the
transactions contemplated hereby, each of Seller and Owner hereby, jointly and
severally, represents and warrants to Purchaser as follows:
5.1. ORGANIZATION. Seller is a corporation duly organized, validly
existing and in good standing under the laws of the State of New York, with all
requisite power and authority to own and operate the Business as it is now
conducted and to own the Purchased Assets in the places where the Business is
now conducted and where the Purchased Assets are now owned or operated.
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5.2. AUTHORITY.
(a) Seller and Owner each have full power and authority to
execute, deliver and perform this Agreement and all agreements and transactions
contemplated hereby. The execution, delivery and performance of this Agreement
and all transactions contemplated hereby have been duly authorized by the Seller
and no other action or proceeding on the part of any other party is necessary to
authorize this Agreement or to consummate the transactions contemplated hereby.
This Agreement has been duly and validly executed and delivered by Seller and
Owner, and constitutes, and each of the other agreements to be executed pursuant
to the terms hereof upon execution and delivery will constitute, a legal, valid
and binding obligation of Seller and Owner, enforceable in accordance with its
terms.
(b) Except for the NRTC, DirecTV and the other Persons set
forth on Schedule 5.2(b) attached hereto, the execution, delivery and
performance of this Agreement or any document related hereto by Seller and Owner
and the consummation by Seller and Owner of all of the transactions contemplated
hereby or thereby will not (with or without the giving of notice or the lapse of
time or both) (i) violate or require any consent or approval under any
applicable provision of any judgement, order, writ, injunction, decree, rule,
regulation or law; (ii) require any consent under, conflict with, result in
termination of, accelerate the performance required by, result in a breach of,
constitute a default under or otherwise violate the terms of any agreements,
instruments or other obligations to which Seller or Owner are a party or by
which they or any of the Purchased Assets may be bound or affected; (iii)
require any consent or approval by, notice to or registration with any
governmental authority or any other Person; (iv) conflict with or violate any
provision of Seller's organization documents; or (v) result in the creation of a
Lien upon any of the Purchased Assets howsoever arising.
5.3. TITLE TO THE PURCHASED ASSETS.
(a) Seller has good and marketable title to all of the
Purchased Assets, free and clear of all Liens except those Liens disclosed on
Schedule 5.3(a) attached hereto.
(b) Immediately following the Closing, Purchaser shall have
sufficient title in and to the Purchased Assets to operate and conduct the
Business in the same fashion as Seller was conducting the Business in the
ordinary course prior to the Closing Date.
5.4. CONDITION OF FIXED ASSETS. All of the Fixed Assets set forth on
Schedule 1.1 are in good operating condition, in a state of good maintenance and
repair, and are adequate and suitable for the purposes which are presently being
used. All appropriate repair and maintenance of the Fixed Assets has been
performed on a current basis and in accordance with generally accepted industry
standards. Except as set forth on Schedule 5.4 attached hereto, none of the
Fixed Assets are in need of any repairs which are outside the ordinary course of
maintenance and repairs routinely performed by Seller in the past, and no
currently needed repairs are reasonably likely to cost, either singularly or in
the aggregate with respect to all Fixed Assets, in excess of Five Thousand
Dollars ($5,000).
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5.5. NRTC MEMBERSHIP; DBS DISTRIBUTION RIGHTS.
(a) Attached hereto as Schedules 1.3, 1.4 and 1.5, are true
and complete copies of each of the NRTC/Member Agreement, the NRTC/Retail
Agreement, and the Other Assumed Agreements, if any, respectively, together with
all amendments, schedules and exhibits thereto.
(b) Seller has paid all sums to NRTC or DirecTV as
appropriate, required under the NRTC/Member Agreement such that Seller is
entitled to the Marketing Revenues. Seller has the right to receive from NRTC,
on a pro rata basis, all other net revenues received by NRTC from DirecTV in
connection with the Programming which are directly attributable to the Committed
Member Residences or the Commercial Establishments in the Locations.
(c) Seller is in full compliance in all material respects with
any and all membership, affiliation, licensing or other requirements or
arrangements as may have been established by NRTC, DirecTv, if any, pursuant to
the NRTC Agreements, or otherwise.
(d) Seller is not in breach of the NRTC Agreements, nor has
Seller failed to perform any material obligation under the NRTC Agreements.
Seller has not received notice of any such breach or non-performance at any time
of such NRTC Agreements. To the best of Seller's knowledge, no other party to
any of the NRTC Agreements, is in default thereunder or has failed to perform
any material obligation thereunder.
(e) Except as disclosed on Schedule 5.5(e) attached hereto,
none of the DBS Services distributed by Seller have been suspended at any time
since inception.
(f) Schedule 5.5(f) attached hereto (as supplemented by
applicable NRTC reports) sets forth a complete list of names and addresses of
all Customers and Subscribers of Seller, identified as Committed Member
Residence and Commercial Establishment for the five (5) year period immediately
preceding the date hereof. Schedule 5.5(f) includes the number of months such
Customer has been a Customer and whether such Customer's account is past due.
Schedule 5.5(f) will be updated not more than three (3) days prior to the
Closing Date. Seller has maintained full and complete information regarding the
location of each Customer's descrambler. As soon as practicable after the
Closing Date, Seller shall also provide to Purchaser a list of Customers and
programs in the form of NRTC's Report 30 (Average Service Retail Report) of the
NRTC Central Billing System Reports, dated as of the Closing Date.
5.6. INVENTORY. The Inventory shall be usable in the ordinary course of
business and shall comply in all respects with industry standards of quality and
marketability. The Inventory will not, as of the Closing Date, include any items
below standard quality, obsolete or sub-prime. The Inventory shall consist
solely of undamaged original units in original sealed carts, located at Seller's
principal place of business. Seller owns all of the Inventory free and clear of
any and all Liens and has full power and authority to transfer the Inventory to
Purchaser.
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5.7. ACCOUNTS RECEIVABLE. The Accounts Receivable represent arms'
length transactions with Customers made in the ordinary course of business and
none of the Accounts Receivable are subject to any counterclaim or setoff.
5.8. PREPAID EXPENSES. Each of the Prepaid Expenses is reasonable in
amount, was incurred and paid in the ordinary course of business and can be
utilized in the Business after the Closing Date.
5.9. ABSENCE OF CERTAIN CHANGES OR EVENTS. Except as set forth in
Schedule 5.9 attached hereto, since December 31, 1995, there has not been and
through the Closing Date there will not be:
(a) any change in the position, financial or otherwise,
assets, liabilities, earnings, book value, Business, operations or prospects of
Seller which is materially adverse, singularly or in the aggregate;
(b) any obligation or liability incurred by Seller (whether
absolute, accrued, contingent or otherwise and whether due or to become due)
other than obligations or liabilities incurred in the ordinary course of
business and consistent with past practices;
(c) any termination or waiver of any rights of Seller of
material value to the Business or to Seller;
(d) any damage, destruction or loss, whether or not covered by
insurance, adversely affecting the Business or the Purchased Assets;
(e) the adoption of any statute, rule, regulation or order
which adversely affects the Business or the Purchased Assets;
(f) any sale, transfer or other disposition of any of the
Purchased Assets to any party, except for dispositions of surplus or used
equipment or other dispositions in the ordinary course of business; or
(g) any agreement to do any of the foregoing.
5.10. LICENSES AND PERMITS. Attached hereto in Schedule 5.10 is a list
of all federal, state, local and foreign permits, certificates, licenses,
approvals and other authorizations necessary in the conduct of the Business. All
such licenses and permits of Seller are in full force and effect, and no
violations are or have been recorded in respect thereof, and no proceeding is
pending or threatened to revoke or limit any thereof. Seller and its conduct of
the Business is in compliance with all applicable laws, statutes, ordinances,
rules, regulations and order of any federal, foreign, state or local government
and any other government department or agency, and in any judgment, decision,
decree or order of any court of governmental agency, department or authority.
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5.11. TAX MATTERS.
(a) Seller has timely filed all federal, state, local and
foreign tax returns and tax reports required to be filed with respect to the
Business with the appropriate governmental agency in all jurisdictions in which
such returns and reports are required to be filed. All such returns and reports
are true, correct and complete, and all amounts shown as owing on them have been
paid, including all interest, penalties, deficiencies and assessments heretofore
levied or assessed against Seller. Seller has duly withheld, collected and
timely paid over, or holds for such payment, to the proper governmental
authorities all taxes required to be withheld or collected by it. There is no
agreement for extension of time of assessment or payment of any taxes of Seller.
No waiver of any statute of limitations has been executed by Seller for any tax
year which remains open or unsettled. To the best knowledge, information and
belief of Seller, there is no examination or audit pending by the Internal
Revenue Service or by any state or local taxing authority with respect to the
tax matters of Seller. There is no liability for taxes or any tax deficiency or
the existence of any basis from which liability for taxes or tax deficiency,
including interest and penalties, might be asserted against Seller for any
period in excess of the applicable reserve for taxes, if any, and Seller has no
knowledge of any such liability or deficiency or the existence of any basis
therefor.
(b) All federal, state, local and foreign income, profits,
franchise, sales, use, occupation, property, excise and other taxes (including
interest and penalties), if any, payable by Seller or relating to or chargeable
against the Purchased Assets or chargeable against Seller's revenue or income
have been fully paid or are not past due and are fully disclosed and accrued on
the books and records of Seller and the proper amount of reserves exist for the
payment thereof.
5.12. DISCLOSURES. No representation or warranty made by Seller or
Owner in this Agreement, and no statement made in any Schedule, exhibit,
certificate or other writing delivered or to be delivered in connection with the
transactions contemplated hereby contains or will contain any untrue statement
of a material fact, or omits or will omit any statement of a material fact
necessary to make the statements contained herein or therein not misleading.
5.13. LITIGATION. There are not actions, suits, proceedings, orders,
investigations or claims pending or, to the best of the Seller's and Owner's
knowledge, any threats against or affecting the Seller, the Purchased Assets or
its Business, at law or in equity, before any court, arbitration panel, tribunal
or governmental department, commission, board, bureau, agency or
instrumentality.
ARTICLE VI
PURCHASER'S REPRESENTATIONS AND WARRANTIES
To induce Seller and Owner to enter into this Agreement and to
consummate the transactions contemplated hereby, Purchaser hereby represents and
warrants to Seller and Owner as follows:
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6.1. ORGANIZATION. Purchaser is a limited partnership duly organized,
validly existing and in good standing under the laws of the State of Georgia,
with all requisite power to own and operate its business as it is now conducted.
6.2. AUTHORITY.
(a) Purchaser has full power and authority to execute,
deliver, and perform this Agreement. The execution, delivery and performance of
this Agreement and all transactions contemplated hereby have been duly
authorized by Purchaser and no other action or proceeding on the part of any
other party is necessary to authorize this Agreement or to consummate the
transactions contemplated hereby. This Agreement has been duly and validly
executed and delivered by Purchaser, and constitutes, and each of the other
agreements to be executed pursuant to the terms hereof upon execution and
delivery will constitute, a legal, valid and binding obligation of Purchaser,
enforceable in accordance with its terms.
(b) Except for the NRTC, DirecTV and the other Persons set
forth on Schedule 6.2(b) attached hereto, the execution, delivery and
performance of this Agreement or any other document related hereto by Purchaser
and the consummation by Purchaser of all of the transactions contemplated hereby
or thereby will not (with or without the giving of notice or the lapse of time
or both) (i) violate or require any consent or approval under any applicable
provision of any judgment, order, writ, injunction, decree, rule, regulation or
law; (ii) require any consent under, conflict with, result in the termination
of, accelerate the performance required by, result in the breach of, constitute
a default under or otherwise violate the terms of any agreements, instruments or
other obligations to which Purchaser is a party; (iii) require any consent or
approval by, notice to or registration with any governmental authority or any
other Person; or (iv) violate any provision of Purchaser's certificate of
limited partnership or limited partnership agreement.
6.3. DISCLOSURES. No representation or warranty made by Purchaser in
this Agreement, and no statement made in any Schedule, exhibit, certificate or
other writing delivered or to be delivered in connection with the transactions
contemplated hereby contains or will contain any untrue statement of a material
fact, or omits or will omit any statement of a material fact necessary to make
the statements contained herein or therein not misleading.
ARTICLE VII
COVENANTS
7.1. CONDUCT OF THE BUSINESS PRIOR TO CLOSING DATE. From the date
hereof through and until the Closing Date, unless performance of the following
obligations is waived by Purchaser (in its sole discretion) in advance and in
writing, Seller and Owner shall:
(a) consult with Purchaser on a regular basis with respect to
all decisions which might adversely affect the Business or the Purchased Assets;
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(b) not modify, amend, alter or terminate any of the NRTC
Agreements, or waive any default or breach thereunder;
(c) comply in all material respects with the NRTC Agreements,
use its best efforts to cure any default or breach thereunder, and promptly
notify Purchaser upon receipt of notice of any default or breach thereunder;
(d) maintain its Records in accordance with prior practice,
maintain the Purchased Assets and the inventory in their present condition,
ordinary wear and tear excepted, consistent with past practice, and otherwise
use its best efforts to operate the Business as currently operated and in the
ordinary course in accordance with practices during the twelve (12) months
preceding the date of this Agreement;
(e) not sell, transfer, dispose or permit a Lien, directly or
indirectly, on any of the Purchased Assets or inventory, except for sales or
dispositions of inventory in the ordinary course of business;
(f) use its best efforts to preserve intact its current
business organization and its relationships with its employees, suppliers,
advertisers, Customers and other Persons having dealings with it;
(g) operate the Business in all material respects in
accordance with the NRTC Agreements, comply in all material respects with all
laws, rules and regulations applicable to it, including the regulations and
policies of the NRTC and DirecTV;
(h) provide to Purchaser, concurrently with filing, sending or
receipt thereof, copies of all reports to and other filings and correspondence
with the NRTC and DirecTV;
(i) provide to Purchaser, promptly upon receipt thereof by
Seller, a copy of (i) any notice of the revocation, suspension or limitation of
the rights under, or of any proceeding for the revocation, suspension, or
limitation of the rights under, any of the NRTC Agreements, and (ii) copies of
all protests, complaints, challenges or other documents submitted to or filed
with the NRTC or DirecTV by third parties concerning the Business and, promptly
upon the filing or making thereof, copies of Seller's responses thereto; and
(j) notify Purchaser in writing immediately upon learning of
the institution or threat of any action against Seller in any court, or any
action against Seller before any governmental agency, and notify Purchaser in
writing promptly upon receipt of any administrative or court order relating to
the Business. Without limiting the generality of the foregoing, neither Seller
nor Owner shall take any of the actions (over which Seller or Owner can exercise
control) listed in Section 5.9 herein.
7.2. ACCESS.
(a) Prior to the Closing, Purchaser may, through its
employees, agents and representatives, make or cause to be made such
investigation of Seller and its properties, books and records as Purchaser deems
necessary or advisable and shall have full access to the auditors
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and attorneys of Seller. Seller shall permit Purchaser and its employees, agents
and representatives, on reasonable notice, to have access to its premises,
personnel and Records. Seller shall cooperate to provide access to its
Customers, suppliers, lenders and such other parties as Purchaser may reasonably
request. Seller shall, and shall cause its officers, attorneys and accountants
to, furnish Purchaser with such financial and operating data and other
information as Purchaser from time to time shall reasonably request. No
investigation by Purchaser shall in any way affect or otherwise diminish the
representations, warranties and covenants of Seller or Owner hereunder.
(b) Purchaser will hold, and will cause its authorized
representatives to hold, in strict confidence, unless compelled to disclose by
judicial or administrative process or official request or by other requirements
of law, all documents and information concerning Seller and the Business
furnished to Purchaser in connection with the transactions contemplated by this
Agreement (except to the extent that such information can be shown to have been
(i) previously known by Purchaser, (ii) in the public domain through no fault of
Purchaser, or (iii) later lawfully acquired by Purchaser from other sources) and
will not release or disclose such information to any other Person, except its
auditors, attorneys, financial advisors and other consultants and advisors and
lending institutions (including banks) in connection with this Agreement, it
being understood that such Persons shall be informed by such party of the
confidential nature of such information and shall be directed by such party and
shall have agreed to treat such information as confidential. In the event that
the transactions contemplated herein are not consummated for any reason,
Purchaser will, upon request by Seller, promptly return to Seller all copies of
any Schedules, statements, documents or other written information obtained in
connection herewith, without retaining any copies or summaries thereof, and
shall maintain such confidence except to the extent such information comes into
the public domain through no fault of Purchaser.
7.3. CONSENT OF NRTC AND OTHERS. Within five (5) business days after
the date of this Agreement, Seller shall cause its counsel to prepare a request
for the consent of the NRTC to the transfer of the NRTC Agreements and such
other requests for consent that Purchaser determines may be necessary or
appropriate to consummate the transactions contemplated hereby, and deliver
drafts of same to Purchaser's counsel. After review by Purchaser's counsel, but
in any event within ten (10) business days after the date of this Agreement,
Seller, Owner and Purchaser shall join in and deliver the requests for consent,
and they will each diligently take all steps necessary or desirable to obtain
the consents. The failure of any of the parties to timely file or diligently
seek the consents, or to cooperate fully with any of the other parties with
respect thereto, shall be deemed a material breach of this Agreement.
7.4. CONSULTING AND NONCOMPETITION AGREEMENT. On or prior to the
Closing Date, the Owner shall enter into a Consulting and Noncompetition
Agreement with Purchaser substantially in the form attached hereto as Schedule
7.4, pursuant to which the Owner will agree (i) not to engage in the Business in
the Locations or within a one hundred (100) mile radius thereof for a period of
three (3) years following the Closing Date; and (ii) to provide consulting
services to Purchaser in accordance therewith (the "Consulting and
Noncompetition Agreement").
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7.5. PUBLIC ANNOUNCEMENTS; CONFIDENTIALITY. Seller and Purchaser shall
mutually agree in advance as to timing, form and content before issuing any
press release or otherwise making any public statements with respect to the
transactions contemplated hereby and shall not issue any press release or make
any public statement prior to reaching mutual agreement, except as may be
required by law. In the event that prior to the Closing Date either party is
required by law to make a statement with respect to the transactions
contemplated herein, such party shall notify the other party in writing as to
the timing, form and content of such statements. Each of Seller, Purchaser and
Owner agrees to maintain the confidentiality of this Agreement and the terms
hereof and any information exchanged by the parties in connection with the
consummation of the transaction contemplated hereby.
7.6. BEST EFFORTS. Subject to the terms and conditions herein provided,
each of Seller, Owner and Purchaser agrees to use its best efforts to take,
execute, acknowledge and deliver, or cause to be taken, executed, acknowledged
and delivered, all actions, deeds, assignments, documents, instruments,
transfers, conveyances, discharges, releases, assurances and consents, and to
do, or cause to be done, all things necessary, proper or advisable under this
Agreement and all applicable laws and regulations to consummate, confirm,
perfect, evidence and otherwise make effective the transactions contemplated by
this Agreement, including actions necessary to obtain all requisite assignments
of agreements and contracts, and to fulfill the requirements of Articles VIII
and IX hereof on or prior to the Closing Date.
7.7. EXCLUSIVE DEALING. During the period from the date of this
Agreement to the Closing Date, Seller and Owner will refrain, and will cause all
of their agents and employees to refrain, from taking, directly or indirectly,
any action to encourage, initiate, solicit or continue any discussions or
negotiations with, or any other offers from, any other Person concerning a
merger, sale of substantial stock or any similar transaction concerning Seller
which would affect the Business, or the sale of the Purchased Assets or any
portion thereof.
ARTICLE VIII
CONDITIONS PRECEDENT TO PURCHASER'S OBLIGATIONS
Purchaser's obligations to perform this Agreement and consummate the
transactions contemplated hereby is subject to the satisfaction (or waiver by
Purchaser), on or before the Closing Date, of each of the following conditions
precedent:
8.1. TRUTH OF REPRESENTATIONS AND WARRANTIES. Each of the
representations and warranties of Seller and Owner contained in this Agreement,
and all representations and warranties set forth in any Schedule or exhibit
attached hereto, shall have been true, complete and correct when made and as of
the Closing Date, without the necessity of any material amendment or
modification, with the same force and effect as if made as of the Closing Date.
8.2. PERFORMANCE. Each of the agreements, obligations, conditions and
covenants to be performed or complied with by Seller or Owner on or before the
Closing Date pursuant to the terms hereof shall have been duly performed or
complied with on or before the Closing Date.
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8.3. REVIEW OF SELLER. The satisfactory completion, in Purchaser's sole
discretion, of Purchaser's due diligence investigation covering the Business as
provided for in Section 7.2 herein.
8.4. NO MATERIAL ADVERSE CHANGE. Prior to the Closing Date and except
as otherwise permitted by this Agreement, there shall not have occurred any
material adverse change in the financial condition, Business, assets, results of
operations or prospects of Seller or the Purchased Assets.
8.5. NO LITIGATION THREATENED. No action, suit or other proceeding
shall be pending before any court, tribunal or governmental authority seeking or
threatening to restrain or prohibit the consummation of the transactions
contemplated by this Agreement, or seeking to obtain substantial damages in
respect thereof, or involving a claim, the consummation of which would result in
the violation of any law, decree or regulation of any governmental authority
having appropriate jurisdiction.
8.6. CONSENTS. All authorizations and approvals of or consents of, or
filings with, any governmental authority or other Person required to be obtained
or made by Seller in connection with the Closing (including, without limitation,
NRTC consent as provided for in Section 7.3 herein, shall have been duly
obtained by Seller and shall be in full force and effect without conditions
which are materially adverse to Purchaser.
8.7. SUBSCRIBERS. On the Closing Date, Seller shall have at least 1,000
Subscribers.
8.8. SELLER'S CLOSING DELIVERIES. Seller and the Owner shall have
delivered to Purchaser the following at Closing:
(a) the Assignment, the Xxxx of Sale and other instruments of
transfer to effectively assign, transfer and convey good and marketable title to
the Purchased Assets as Purchaser shall reasonably request, in form and
substance reasonably satisfactory to Purchaser;
(b) all Records or copies of the Records;
(c) a certified copy of resolutions of the Board of Directors
of Seller and Owner authorizing the execution, delivery and performance of this
Agreement;
(d) evidence satisfactory to Purchaser that all Liens
described on Schedule 5.3(a) herein have been removed or otherwise addressed to
Purchaser's satisfaction;
(e) a list of the Accounts Receivable from all Customers
(Reports 18A and 19A) and a list of the Unearned Revenue (Report 17) each as of
the NRTC billing period ending immediately prior to the Closing Date;
(f) the Consulting and Noncompetition Agreement;
(g) a certificate signed by Seller's president and Owner,
dated the Closing Date, to the effect that the conditions set forth in this
Article VIII have been satisfied; and
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(h) such other documents and instruments as may be reasonably
requested and satisfactory to Purchaser and its counsel in connection with
Seller's and Owner's satisfaction of each of its obligations hereunder.
ARTICLE IX
CONDITIONS PRECEDENT TO SELLER'S OBLIGATIONS
Seller's obligation to perform this Agreement and consummate the
transactions contemplated hereby is subject to the satisfaction (or waiver by
Seller), on or before the Closing Date, of each of the following conditions
precedent:
9.1. TRUTH OF REPRESENTATIONS AND WARRANTIES. Each of the
representations and warranties of Purchaser contained in this Agreement, and all
representations and warranties set forth in any Schedule or exhibit attached
hereto, shall have been true, complete and correct when made and as of the
Closing Date, without the necessity of any material amendment or modification,
with the same force and effect as if made as of the Closing Date.
9.2. PERFORMANCE. Each of the agreements, obligations, conditions and
covenants to be performed or complied with by Purchaser on or before the Closing
Date pursuant to the terms hereof shall have been duly performed or complied
with on or before the Closing Date.
9.3. NO LITIGATION THREATENED. No action, suit or other proceeding
shall be pending before any court, tribunal or governmental authority seeking or
threatening to restrain or prohibit the consummation of the transactions
contemplated by this Agreement, or seeking to obtain substantial damages in
respect thereof, or involving a claim, the consummation of which would result in
the violation of any law, decree or regulation of any governmental authority
having appropriate jurisdiction.
9.4. CONSENTS. All authorizations and approvals of or consents of, or
filings with, any governmental authority or other Person required to be obtained
or made by Purchaser in connection with the Closing (including, without
limitation, NRTC consent as provided for in Section 7.3 herein, shall have been
duly obtained by Purchaser and shall be in full force and effect without
conditions which are materially adverse to Seller.
9.5. PURCHASER'S CLOSING DELIVERIES. Purchaser shall have delivered to
Seller and Owner the following at Closing:
(a) the Closing Payment;
(b) the Note and the Security Agreement duly executed by
Purchaser;
(c) the Consulting and Noncompetition Agreement;
(d) a certificate signed by Purchaser's general partner, dated
the Closing Date, to the effect that the conditions set forth in this Article IX
have been satisfied; and
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(e) such other documents and instruments as may be reasonably
requested and satisfactory to Seller and its counsel in connection with
Purchaser's satisfaction of each of its obligations hereunder.
ARTICLE X
SURVIVAL OF REPRESENTATIONS AND WARRANTIES;
INDEMNIFICATION
10.1. SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All representations
and warranties made by any party to this Agreement or pursuant hereto shall
survive the Closing of the transactions hereunder. The representations and
warranties hereunder shall not be affected or diminished by any investigation at
any time by or on behalf of the party for whose benefit such representations and
warranties were made. All statements contained herein or in any Schedule,
exhibit, certificate, list or other document delivered pursuant hereto or in
connection with the transactions contemplated hereby shall be deemed to be
representations and warranties.
10.2. INDEMNIFICATION OF PURCHASER. Each of Seller and Owner, jointly
and severally, and each of their representatives, successors, heirs and assigns,
agree to indemnify, reimburse and hold Purchaser and each of its partners,
subsidiaries, affiliates, successors, assigns and agents harmless from, against,
for and in respect of any and all damages, losses, settlement payments,
obligations, liabilities, claims, demands, actions or causes of action,
judgments, encumbrances, costs and expenses (including reasonable attorneys'
fees) (collectively, the "Indemnifiable Damages") relating to, resulting from or
arising out of (i) any misrepresentation, untruth, inaccuracy, breach or
nonfulfillment of any representation, warranty, agreement or covenant of Seller
or Owner contained in or made in connection with this Agreement or in any
Schedule, exhibit, certificate or other document delivered pursuant hereto, (ii)
the failure of Seller or Owner to pay, perform or discharge promptly when due
any of their obligations, liabilities and debts except as provided under this
Agreement, (iii) any liability or obligation relating to the operation of the
Business prior to the Closing Date, (iv) any breach or default prior to the
Closing Date by Seller or Owner under any of the NRTC Agreements,(v) any state
or local sales, use, excise, personal property or similar tax liability
(including penalties and interest) of Seller, (vi) any liability or obligation
relating to the operation of the Mini-Cable Business prior to or after the
Closing Date, and (vii) any other liabilities, obligations or claims, whether
absolute or contingent, known or unknown, matured or unmatured and not expressly
assumed by Purchaser hereunder.
10.3. INDEMNIFICATION OF SELLER. Subject the limitations hereinafter
set forth, Purchaser shall indemnify, reimburse and hold Seller and each of its
shareholders, subsidiaries, affiliates, officers and directors harmless from,
against, for and in respect of any and all Indemnifiable Damages relating to,
resulting from or arising out of (i) any misrepresentation, untruth, inaccuracy,
breach or nonfulfillment of any representation, warranty, agreement or covenant
of Purchaser contained in or made in connection with this Agreement or in any
Schedule, exhibit, certificate or other document delivered pursuant hereto, (ii)
the failure of Purchaser to pay, perform or discharge promptly when due (a) its
obligations set forth in Section 4.3 herein, or (b) the Current Liabilities,
(iii) the assertion against Seller of any liability or obligation relating
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to Purchaser's operation of the Business after the Closing Date, and (iv) any
breach or default after the Closing Date by Purchaser under the NRTC Agreements.
10.4. RIGHT TO CONTEST.
(a) If any party entitled to indemnification hereunder (the
"Indemnified Party") receives notice or has knowledge of any claim for which it
believes the other party hereto is obligated to provide indemnification pursuant
to Sections 10.2 or 10.3 herein (the "Indemnifying Party"), the Indemnified
Party shall notify the Indemnifying Party in writing of such claim within twenty
(20) days of its receipt of same (the "Indemnification Claim"). The
Indemnification Claim shall set forth a brief description of the facts giving
rise to such a claim and the amount (or reasonable estimate) of the
Indemnifiable Damages suffered or which may be suffered by the Indemnified
Party. The Indemnified Party shall, at the expense of the Indemnifying Party,
provide all information regarding the contest or defense of the claim and
cooperate fully with the Indemnifying party in the conduct of any such contest
or defense. Before being required to make any payment pursuant to Sections 10.2
or 10.3 herein, the Indemnifying Party may, at its own expense, elect to
undertake and control the defense of, and take all necessary steps properly to
contest any claim in respect thereof involving third parties or to prosecute
such claim to conclusion or settlement satisfactory to the Indemnified Party. If
the Indemnifying Party makes the foregoing election, then the Indemnified Party
shall have the right to participate, at its own expense, in all proceedings but
shall not admit any liability, settle, compromise, pay or discharge the claim
without the prior written consent of the Indemnifying Party. If the Indemnifying
Party does not make such election, it shall be obligated to pay the costs of
defending or prosecuting such claim and shall be bound by whatever result is
obtained by the Indemnified Party respecting such claim.
(b) Except as herein expressly provided, the remedies provided
in this Article X shall be cumulative and shall not preclude assertion by any
party of any other rights or the seeking of any other remedies against any other
party hereto.
10.5. RIGHT OF OFFSET. Purchaser shall have the right, at its sole
discretion, to offset, on a dollar-for-dollar basis, against any and all amounts
due Seller pursuant to the Note any amounts due to Purchaser from Seller or the
Owner pursuant to this Agreement, including, without limitation, Indemnifiable
Damages due pursuant to Section 10.2, adjustments pursuant to Section 4.3(d),
and any other amounts due from Seller pursuant to any other provision hereof
(the "Right of Offset"). Before exercising its Right of Offset, Purchaser shall
provide written notice of its intent to exercise such right.
ARTICLE XI
MISCELLANEOUS
11.1. NOTICES. All notices, requests, demands and other communications
hereunder shall be in writing and shall be deemed to have been duly given, upon
personal delivery, upon receipted delivery by overnight courier, charges prepaid
or charged to the sender's account if delivery is confirmed by the delivery
service, upon receipt of a confirmed transmission if by facsimile transmission,
or three (3) days after mailing if mailed by certified or registered mail,
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postage prepaid, return receipt requested, as follows (or at such other address
for a party as shall be specified by like notice; provided that notice of a
change of address shall be effective only upon receipt thereof):
To Purchaser: Digital Television Services of New York II, LP
Xxxxxxxx 000, Xxxxx 000
0000 Xxxxxxx Xxxxxx Xxxx
Xxxxxxx, Xxxxxxx 00000
Attn: Xxxxxxx X. Xxxxxxxx, Xx., President
with a copy to: C. Xxxx Xxxxx, Esq.
Xxxxxx Xxxxxxx Xxxxx & Xxxxxxxxxxx, L.L.P.
NationsBank Corporate Center, Suite 3350
000 Xxxxx Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
To Seller: Falls Earth Station, Inc.
00 Xxxx Xxxx
Xxxxxxxx Xxxxx, Xxx Xxxx 00000
Attn: Xxxxxx X. Xxxxxx
with a copy to: Xxxx X. Xxxxxx, Esq.
Xxxxxx & Xxxxxx
000 Xx. Xxxxxxxx Xxxxxx
Xxxxxxx Xxxx, Xxx Xxxx 00000
11.2. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, and each such counterpart hereof shall be deemed to be an original
instrument, but all such counterparts together shall constitute one and the same
agreement.
11.3. GOVERNING LAW. This Agreement shall be governed by and
interpreted, construed and enforced in accordance with the laws of the State of
Georgia, without regard to the choice of law provisions thereof.
11.4. WAIVERS. No provisions of this Agreement may be waived except by
an instrument in writing signed by the party sought to be bound. No failure or
delay by any party in exercising any right or remedy hereunder shall operate as
a waiver thereof, and a waiver of a particular right or remedy on one occasion
shall not be deemed a waiver of any other right or remedy or of the same right
or remedy or a waiver on any future occasion.
11.5. SEVERABILITY. The invalidity or unenforceability of any term or
provision of this Agreement shall not affect the other provisions hereof, and
this Agreement shall be construed in all respects as if such invalid or
unenforceable provision were omitted.
11.6. SECTION AND ARTICLE HEADING REFERENCES. The Section and Article
headings contained in this Agreement are for reference purposes only and shall
not affect in any way the meaning or interpretation of this Agreement.
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11.7. SUCCESSORS AND ASSIGNS; ASSIGNMENT. This Agreement shall be
binding upon, inure to the benefit of, and be enforceable by, the respective
successors and permitted assigns, if any, of the parties hereto. Except as
otherwise expressly provided herein, nothing expressed or implied herein is
intended or shall be construed to confer upon or give any Person, other than the
parties hereto, any right or remedy hereunder or by reason hereof. This
Agreement may not be assigned by Purchaser (except to a party which, directly or
indirectly is controlled by, controls or is under common control with,
Purchaser) or Seller without the prior written consent of the other party.
11.8. ENTIRE AGREEMENT; AMENDMENTS. This Agreement and the Schedules
attached hereto constitute the entire agreement and understanding of the parties
in respect of the transactions contemplated hereby and supersede all prior
correspondence, conversations, agreements, arrangements, understandings and
other writings. No promises, covenants or representations of any character or
nature other than those expressly stated herein have been made to induce either
party to enter into this Agreement. This Agreement may be amended or modified
only by a written instrument signed by Purchaser and Seller.
11.9. EXPENSES. Each of the parties hereto shall pay its own expenses
incurred in connection with the negotiation and consummation of this Agreement,
including the charges of its respective attorneys, accountants and other
representatives.
11.10. KNOWLEDGE OF SELLER. Where any representation or warranty
contained in this Agreement is expressly qualified by reference to knowledge,
Seller and Owner confirm that they have made or caused to be made due and
diligent inquiry as to the matters that are the subject of such representations
and warranties.
11.11. FACSIMILE SIGNATURES. Facsimile signatures shall be considered
original signatures for purposes of execution and enforcement of the rights
delineated in this Agreement.
11.12. SCHEDULES. The Schedules referred to in this Agreement are
attached hereto, made a part hereof and incorporated herein by this reference.
11.13. TERMINATION OF AGREEMENT.
(a) Notwithstanding any other provision herein contained to the
contrary, this Agreement may be terminated at any time prior to the Closing Date
by (i) the mutual written consent of Seller and Purchaser, (ii) either party
upon written notice to the other party if the Closing has not occurred on or
before the Termination Date, (iii) Seller if the covenants and conditions set
forth in Articles VII and IX required to be complied with or performed by
Purchaser have not been complied with or performed by Purchaser and such
noncompliance and nonperformance shall not have been cured or eliminated (or by
its nature cannot be cured or eliminated) by Purchaser on or before the sixtieth
(60th) day following written notice thereof from Seller; provided that neither
Seller nor Owner have defaulted in any material respect with respect to any of
their obligations hereunder, (iv) Purchaser if the covenants and conditions set
forth in Articles VII and VIII required to be complied with and performed by
Seller or Owner have not been complied with or performed by Seller and Owner and
such noncompliance and nonperformance shall not have been cured or eliminated
(or by its nature cannot be cured or
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eliminated) by Seller or Owner on or before the sixtieth (60th) day following
written notice thereof from Purchaser; provided that Purchaser shall not have
defaulted in any material respect with respect to any of its obligations
hereunder.
(b) In the event of termination pursuant to this Section 11.13, written
notice thereof shall be given to the other party and this Agreement shall
terminate immediately. In the event of such termination pursuant to Section
11.13(a)(i) or (ii), no party hereto (or any of their respective directors,
officers or partners) shall have any liability or further obligation to the
other party to this Agreement.
(c) In the event of termination pursuant to Section 11.13(a)(iii) or
(iv), the terminating party shall be entitled to recover from the other party
hereto all damages, losses, costs and expenses (including reasonable attorneys'
fees) provided by law.
[REMAINDER OF PAGE LEFT INTENTIONALLY BLANK]
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IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the date first above written.
PURCHASER:
Digital Television Services of New York II, LP
By: Columbia DBS Management, LLC
Its: General Partner
By:
----------------------------------
Its:
-----------------------------
SELLER:
Falls Earth Station, Inc.
By:
----------------------------------
Its:
-----------------------------
(SEAL)
----------------------------------
Xxxxxx X. Xxxxxx
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