Exhibit 2.2
ADVANCED RADIO TELECOM CORP.
ASSET PURCHASE AGREEMENT
This Asset Purchase Agreement (the "Agreement") is made as of March 28,
2000 (the "Signing Date") among Advanced Radio Telecom Corp., a Delaware
corporation ("ART") and Bachow Communications, Inc., a Delaware corporation
("BCI").
WHEREAS, ART wishes to purchase, and BCI wishes to sell, certain licenses
granted by the Federal Communications Commission (the "FCC") to BCI listed on
Schedule 1.1 hereto (the "Licenses") and certain other assets specified herein
in exchange for that number of shares of ART's Common Stock, $.001 par value per
share (the "Common Stock"), calculated pursuant to Section 1.3 hereof (the
"Transaction").
WHEREAS, the Assets (as defined herein) comprise more than ninety percent
(90%) of the assets of BCI; and
WHEREAS, ART and BCI desire the Transactions to qualify as a "tax free"
reorganization under Section 368(a) of the Internal Revenue Code of 1986, as
amended.
NOW, THEREFORE, in consideration of the premises and the respective
covenants and representations and warranties herein contained, the parties
hereto agree as follows:
1. Sale of Assets.
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1.1. Sale of Assets. Subject to and upon the terms and conditions of this
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Agreement, BCI agrees to sell and transfer to ART and ART agrees to purchase and
acquire from BCI, free and clear of any pledge, lien, options, warrants,
security interest, mortgage claim, charge, liability, right of first refusal,
lease, management agreement, contractual restrictions on transfer or other
encumbrance of any kind whatsoever (the "Liens") other than those in favor of
ART, at the Closing (defined below) all of BCI's right, title and interest in,
to and under the following assets (the "Assets"):
(a) the Licenses and all other licenses, permits, authorizations and
approvals from all Federal, state, municipal, county, local and any other
governmental or quasi governmental department, commission, board, bureau,
agency, court or other instrumentality (collectively, the "Governmental
Authorities") with respect to the foregoing; and
(b) The leases and the related agreement listed on Schedule 1.1
hereto (the "Leases").
1.2. No Assumption of any Liabilities. ART will not assume, satisfy or
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perform any of the debts, liabilities, obligations or commitments of BCI other
than: (i) liabilities under any Leases included in the Assets arising after the
Closing Date; and (ii) Assumed Expenses (as defined below) (collectively, the
"Assumed Liabilities"). BCI will retain and satisfy all such debts, liabilities,
obligations and commitments other than the Assumed Liabilities.
1.3. Consideration.
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(a) Subject to and upon the terms and conditions of this Agreement,
in consideration of sale and transfer of the Assets to ART, ART will issue
to BCI at the Closing the number of shares of its Common Stock (the
"Consideration") equal to: the quotient of (i) the product of (A) two
multiplied by (B) the excess of (x) 39,669,466 over (y) the quotient of the
dollar amount of the Assumed Expenses divided by $1.35, divided by (ii) 36
(rounded up to the newest whole number).
(b) In the event that, prior to Closing, any stock split,
combination of the shares of Common Stock, or recapitalization of ART
occurs, the Consideration shall be equitably adjusted so that BCI will
receive after the event occasioning such adjustment the same number of
shares of Common Stock as it would have received had the Closing occurred
immediately prior to such event. In the event of any consolidation or
merger of ART with another corporation or entity prior to Closing, the sale
of substantially all of ART's assets to another corporation or entity prior
to Closing, or if ART is not involved in such a transaction, but is not at
the Closing listed on Nasdaq, the New York Stock Exchange or a comparable
system (a "Qualifying Listing"), the Consideration shall be altered so that
BCI will receive (i) if the consideration in such transaction is publicly
traded stock, the number of shares of such stock as would be issuable or
payable with respect to or in exchange for that number of shares of Common
Stock calculated pursuant to Section 1.3(a) if the Consideration had been
issued immediately prior to such consolidation, merger or sale and (ii) if
the consideration in such transaction is other than publicly traded stock
or if the Consideration would be issued in Common Stock and ART does not
have a Qualifying Listing, cash equal to the product of (A) the number of
shares calculated pursuant to Section 1.3(a) and (B) $36.
2. Closing.
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2.1. The closing of the Transaction (the "Closing") shall take place on
such date and at such time within 10 days after all necessary FCC consents to
assign the Licenses become Final Order (as defined in Section 10.3) (the "FCC
Consent), subject to the satisfaction or waiver of the conditions contained in
Sections 10 and 11 (but in no event later than April 1, 2001) as mutually agreed
by the parties (the "Closing Date") at the offices of Ropes & Xxxx, Xxx
Xxxxxxxxxxxxx Xxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000.
2.2. Deliveries by BCI at Closing. At Closing, BCI shall deliver to ART:
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(a) any Bills of Sale or other instruments of assignment reasonably
required or requested by ART to transfer, convey and assign the Assets to
ART;
(b) certified copies of resolutions of the shareholders and the
board of directors of BCI authorizing BCI to enter into and perform its
obligations under this Agreement;
(c) a copy of the charter documents of BCI certified by the
appropriate public official and a copy of the by-laws of BCI certified by
its Secretary; and
(d) all such other documents and instruments as ART or its counsel
shall reasonably request to consummate or evidence the transactions
contemplated hereby; and
2.3. Deliveries by ART at Closing. At Closing, ART shall deliver to BCI:
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(a) one or more stock certificates as BCI shall request, not
exceeding 10, representing the Consideration registered in the name of BCI
(or cash if required under Section 1.3(b));
(b) certified copies of the resolutions of the board of directors of
ART authorizing ART to enter into and perform its obligations under this
Agreement;
(c) a copy of the charter documents of ART certified by the
appropriate public official and a copy of the bylaws of ART certified by
its secretary; and
(d) all such other documents and instruments as BCI or its counsel
shall reasonably request to consummate or evidence the transactions
contemplated hereby.
2.4. Certifications; Opinions. At Closing, ART and BCI shall deliver the
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certificates, opinion of counsel and other documents described in Sections 10
and 11 hereof, respectively, unless waived.
2.5. Form of Documents and Instruments. All of the documents and
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instruments delivered at Closing shall be in form and substance, and shall be
executed and delivered in a manner, reasonably satisfactory to the parties'
respective counsel.
3. Representations and Warranties of BCI. BCI represents and warrants to ART
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as follows:
3.1. Entity Status. BCI is a corporation duly organized, validly existing
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and in good standing under the laws of the Commonwealth of Pennsylvania. BCI
has full corporate power and authority to carry on its business as and where now
conducted, and to own or lease and to operate its properties and assets where
such properties and assets are now owned, leased or operated by it and where
such business is now conducted by it. BCI has delivered to ART complete and
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correct copies of any organizational, by-laws or charter documents applicable to
it, each as amended and in effect on the date hereof. Xxxx Xxxxxx (the
"Stockholder", and together with BCI the "Bachow Entities") owns 100% of the
outstanding capital stock of BCI, and there are no outstanding subscriptions,
options, warrants or other rights convertible into or exercisable for, or any
agreements to issue, capital stock of BCI.
3.2. Authority for Agreement; Conflicts.
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(a) BCI has all necessary power and authority, corporate or
otherwise, to enter into, execute and deliver this Agreement, the Rights
Agreement (the "Rights Agreement") entered into between ART and Bachow
Entities dated the date hereof, the Management Agreement (the "Management
Agreement") entered into between ART and BCI dated the date hereof and the
other documents to be delivered by Bachow Entities at the Closing (the
Rights Agreement, Management Agreement and such other documents, including
without limitation the Guarantee of Xxxx Xxxxxx attached as Exhibit A
hereto (the "Guarantee") are collectively the "Bachow Documents") and to
perform fully its obligations hereunder and the transactions contemplated
hereby and thereby. The execution, delivery and performance of this
Agreement and the applicable Bachow Documents by BCI has been duly
authorized by all necessary corporate action.
(b) Each of this Agreement, the Management Agreement, the Rights
Agreement and the Guarantee has been, and the other Bachow Documents, at
the Closing, will have been, duly and validly executed and delivered by, as
applicable, BCI and Stockholder and each of this Agreement, the Management
Agreement and the Rights Agreement constitutes, and the other Bachow
Documents will constitute, the legal, valid and binding obligation of BCI
and, if a signatory thereto, Stockholder and each of this Agreement, the
Management Agreement, the Rights Agreement and the Guarantee is, and the
other Bachow Documents will be, enforceable by and against BCI and, if a
signatory thereto, Stockholder in accordance with its respective terms,
except as enforceability thereof may be limited by applicable bankruptcy,
reorganization, insolvency or other laws affecting creditors= rights
generally or by general principles of equity, regardless of whether such
enforceability is considered in equity or at law.
(c) The execution and delivery of this Agreement, the Rights
Agreement, the Management Agreement, the Guarantee and the Bachow Documents
by BCI and, if a signatory thereto, Stockholder and the consummation of the
transactions contemplated hereby and thereby will not conflict with or
result in any violations of or defaults, except such as would not have a
material adverse effect on the Assets or on obtaining FCC Consent, under:
(i) subject to the receipt of FCC Consent, any statute, regulation, order,
judgment or decree of any federal, state or local governmental body or
regulatory authority applicable to BCI, the Stockholder or any of the
Assets; (ii) any mortgage, indenture, lease, agreement, instrument or other
obligation to which BCI or the Stockholder is a party or by which any of
the Assets are bound; or (iii) any permit,
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concession, grant, franchise, license, of or applicable to BCI or the
Stockholder. Such execution, delivery and consummation will not result in
the creation of any Lien upon any of the Assets.
3.3. Consents and Approvals of Governmental Authorities. Except for the
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FCC Consent and the expiry or earlier termination of the waiting period under
the HSR Act, no consent, approval or filing with any governmental or regulatory
authority is required to be made or obtained by BCI or Stockholder in connection
with its execution and delivery of and performance of its obligations under,
this Agreement and the Guarantee.
3.4. FCC Regulatory Matters.
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(a) BCI is in compliance with the Federal Communications Act of
1934, as amended (the "Communications Act"), and the rules, regulations and
policies of the FCC promulgated thereunder applicable to either Bachow
Entity or the Assets, and each Bachow Entity is in compliance with all
other federal, state and local laws, rules, regulations and ordinances
applicable to either Bachow Entity or the Assets and is not in default
under any order, writ, injunction or decree of any court or governmental
agency or instrumentality applicable to either Bachow Entity or the Assets,
except for any noncompliance that would not materially threaten or
adversely affect the validity, continued effectiveness, material terms, or
likelihood of renewal of any of the Licenses or the grant of FCC Consent.
(b) FCC Licenses. Schedule 1.1 sets forth a true and complete list
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of each License that is being assigned to ART hereunder, the name of the
licensee or permit holder, the call sign, the License expiration date, and
the status of any applications for assignment, transfer or waiver of FCC
rules filed with the FCC. BCI has provided to ART true and correct copies
of the Licenses received by it from the FCC. None of such Licenses are
subject to any Lien, and BCI owns all of the right, title and interest in,
to and under such Licenses. All the Licenses are currently valid and in
full force and effect and BCI and its affiliates have met material
applicable construction or build-out regulations required to be met as of
this date for each of the Licenses. Neither BCI nor any of its affiliates
has received, as of the date of this Agreement, any notification of an
investigation, violation or forfeiture, any notice of apparent liability,
or any other order or complaint issued by or before any court or
governmental body, including the FCC that could in any manner threaten or
adversely affect the validity, continued effectiveness, material terms, or
likelihood of renewal of any of the Licenses, nor, as of the date of this
Agreement, to the knowledge of BCI is any such action threatened (other
than, in any such case, actions or matters relating to the wireless
communications or 38.6 - 40 GHz licenses ("39 GHz Licenses") industries
generally). At the date of this Agreement, neither BCI nor any of its
affiliates has knowledge of any other proceedings (other than proceedings
relating to the wireless communications industry or 39 GHz Licenses
generally) that could in any manner threaten or adversely affect the
validity, continued effectiveness, material terms,
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or likelihood of renewal of any of the Licenses.
(c) Fees. All franchise, license or other fees and charges that
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have become due and payable with respect to the Assets pursuant to any
applications, filings, recordings and registrations with, and all
validations or exemptions, approvals, orders or authorizations, consents,
Licenses, certificates and permits from, the FCC, any state public utility
commission and any other federal, state or local regulatory or governmental
bodies or authorities, including any subdivision thereof, have been paid.
(d) License Compliance. No event has occurred or failed to occur
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which (i) results in, or after notice or lapse of time or both would result
in, revocation, suspension, adverse modification, non-renewal, impairment,
restriction or termination of, or order of forfeiture with respect to, any
License or (ii) materially adversely affects any of the rights of BCI or
any of its affiliates thereunder, except in the case of clause (i) or (ii),
for litigation, legislation, rule making or other matters, in each case,
affecting the wireless communications industry or 39 GHz Licenses
generally. At the date of this Agreement, except to the extent caused by
ART's failure to comply with its obligations under the Management
Agreement, BCI has no reason to believe that the Licenses will not be
renewed by the FCC in the ordinary course.
(e) Reports. Any and all material reports and filings required to
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be filed with the FCC by the Bachow Entities with respect to the Licenses
have been filed and BCI has provided true and correct copies of all such
reports and filings to ART. All such reports and filings were accurate and
complete in all material respects.
(f) Disclosure. BCI knows of no facts pertaining to its
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qualifications to be a licensee which would cause the FCC not to issue its
approval with respect to, or otherwise prevent, the transfer to ART
pursuant to this Agreement of the Licenses (other than those relating to
the wireless communications industry or 39 GHz Licenses generally).
(g) Exception. Notwithstanding any of the foregoing, BCI makes no
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representation with respect to, and assumes no responsibility hereunder
for, (a) the demonstration of "substantial service" set forth in Section
101.17(a) of the FCC's rules or the consequent nonrenewal of any License
under that section or (b) the failure of any of the representations and
warranties in Section 3.4 to be true and correct if such failure is due,
directly or indirectly, to ART's actions under or in connection with, or
failure to act in breach of its obligations under, the Management
Agreement. ART expressly assumes the risks referred to in the preceding
sentence.
3.5. Title to the Transferred Assets; Liens; Other Assets. BCI has,
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subject to the laws and regulations administered by the FCC generally applicable
to 39 GHz Licenses, good, indefeasible and transferable title to all of the
Assets, free and clear of all Liens.
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3.6. Leases. Schedule 1.1 includes a correct description of each Lease
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included in the Assets, including the name of the Landlord, the address of the
leased location and the monthly rent. A true, complete and correct copy of each
written Lease included in the Assets has been provided to ART. A complete
description of all terms of any oral lease is set forth on Schedule 1.1. Each
such Lease is a legal, valid, binding enforceable agreement, in full force and
effect and consummation of the transactions contemplated hereby will not cause a
default under or permit the termination or modification of any such Lease. No
party to any such Lease is in default thereunder.
3.7. Contracts. Except for this Agreement and the Leases, neither Seller
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is a party to any contract, commitment or similar agreement or arrangement,
whether written or oral, by which any of the Assets is bound or affected.
3.8. Litigation. At the date of this Agreement, there are no actions,
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claims, proceedings, suits and investigations pending, or, to the best knowledge
of BCI threatened against BCI or any of its properties, assets or rights before
any court, arbitrator or administrative or governmental body: (i) which seek to
revoke, rescind, cancel, modify or refuse to renew any License or; (ii) relating
to the transactions contemplated hereby, nor is there any basis for any such
action. As of the date of this Agreement, there is no judgment, order or decree
adversely affecting the Assets or the transactions contemplated hereby. At the
Closing, there shall be no order or decree materially adversely affecting the
Assets or the transactions contemplated hereby (except those relating to the
wireless communications industry or 39 GHz Licenses generally).
3.9. Disclosure. Neither this Agreement nor any exhibit or schedule
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hereto nor any statement, list or certificate delivered to ART at or prior to
the Closing in connection with this Agreement contains any untrue statement of a
material fact or omits to state a material fact necessary in order to make the
statement contained herein and therein in the context in which they were made
not misleading. Except as otherwise disclosed herein or on the schedules hereto,
BCI knows of no information or fact that has or could have a material adverse
effect on the Assets except that BCI makes no representation with respect to
changes affecting 39 GHz Licenses generally and changes external to BCI and its
business such as changes in demographics, the industry or the economy.
3.10. Brokerage. There are no claims for brokerage commissions or finder=s
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fees or similar compensation in connection with the transactions contemplated by
this Agreement based on any arrangement or agreement made by or on behalf of BCI
or Stockholder other than with Xxxxxxx and Associates, L.P. which fees will be
paid by BCI, to the extent not included in Assumed Expenses.
3.11. Accredited Investors. BCI is an "accredited investor" as such term
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is defined under Rule 501 under the Securities Act. BCI investment decisions are
made by persons having such knowledge and experience in business and financial
matters as to be capable of evaluating the merits and risk of the investment
contemplated hereby. BCI is capable of bearing the economic
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risks associated with the investment contemplated hereby. BCI has been provided
access to such information and documents regarding ART and has requested and has
been afforded an opportunity to ask questions of, and receive answers from,
representatives of ART concerning this agreement and the Common Stock.
3.12. Own Account. BCI is acquiring the shares of Common Stock (the
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"Securities") for its own, for investment and not with a view to any
"distribution" thereof within the meaning of the Securities Act. It is
understood that, in addition to any other transfers complying with applicable
securities laws, the Securities may be transferred (a) pursuant to a pro rata
distribution to shareholders upon the liquidation of BCI, (b) by gift to the
spouse or issue of Stockholder or to a trust or other vehicle solely for the
benefit of any of the foregoing, and (c) by gift to a charitable trust organized
by Stockholder (collectively, the "Permitted Transfers").
3.13. Transfer Restrictions. BCI understands that the Securities are
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subject to certain restrictions on transfers and that the Company may, as a
condition to a permitted transfer (other than a "Permitted Transfer") of any of
the Securities, require that the request for transfer be accompanied by an
opinion of counsel, in form and substance reasonably satisfactory to the
Company, to the effect that the proposed transfer does not result in violation
of the Securities Act, unless such transfer is covered by an effective
registration statement under the Securities Act or by Rule 144(k) of the
Securities Act. BCI understands that each certificate representing the
Securities will, subject to subsequent removal, bear the following legend or one
substantially similar:
The securities represented by this certificate were issued
in a private placement, without registration under the
Securities Act of 1933, as amended (the "Act"), and may not
be sold, assigned, pledged or otherwise transferred in the
absence of an effective registration under the Act covering
the transfer or an opinion of counsel, satisfactory to the
issuer, that registration under the Act is not required.
3.14. Private Placement. BCI has been advised that the Securities have
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not been and, subject to Section 5 hereof, are not being registered under the
Securities Act, and that ART in issuing the Securities is relying upon, among
other things, the representations and warranties of BCI in this Section 3 in
concluding that the offer and sale of the Securities shall be exempt from the
provisions of Section 5 of the Securities Act.
4. Representations and Warranties by ART. ART represents and warrants as
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follows:
4.1. Entity Status. ART is a corporation duly organized, validly existing
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and in good standing under the laws of the State of Delaware. ART has full
corporate power and authority to carry on its business as and where now
conducted, and to own or lease and operate its properties and assets where such
properties and assets are now owned, leased or operated by it and where such
business is now conducted by it. ART is qualified to do business and is in good
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standing in each of the jurisdictions in which the nature of its business or the
property owned or leased by it make such qualification necessary.
4.2. Authorization for Agreement; Conflict.
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(a) ART has all necessary corporate power and authority to enter
into and execute this Agreement, the Rights Agreement, the Management
Agreement and the other documents to be delivered by ART at the Closing
(the "ART Documents") and to perform fully its obligations hereunder and
the transactions contemplated hereby and thereby. The execution, delivery
and performance of this Agreement and the ART Documents has been duly
authorized by all necessary corporate action.
(b) Each of this Agreement, the Management Agreement and the Rights
Agreement has been, and the other ART Documents, at the Closing, will have
been, duly and validly executed and delivered by ART and each of this
Agreement, the Management Agreement and the Rights Agreement constitutes,
and the other ART Documents will constitute, the legal, valid and binding
obligation of ART and each of this Agreement, the Management Agreement and
the Rights Agreement is, and the other ART Documents will be, enforceable
by and against ART in accordance with its respective terms, except as
enforceability thereof may be limited by applicable bankruptcy,
reorganization, insolvency or other laws affecting creditors= rights
generally or by general principles of equity, regardless of whether such
enforceability is considered in equity or at law.
(c) The execution and delivery of this Agreement and the ART
Documents by ART and the consummation of the transactions contemplated
hereby and thereby will not conflict with or result in any violations of or
defaults, except such as would not have a material adverse effect on ART or
the attainment of FCC Consent, under: (i) any statute, regulation, order,
judgment or decree of any federal, state or local governmental body or
regulatory authority applicable to ART; (ii) any mortgage, indenture,
lease, agreement, instrument or other obligation to which ART is a party;
or (iii) any permit, concession, grant, franchise, license, of or
applicable to ART.
4.3. Litigation. As of the date of this Agreement, there are no actions,
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claims, proceedings, suits or investigations pending, or, to the knowledge of
ART, threatened, that question the validity of this Agreement or of any action
taken or to be taken pursuant to or in connection with the provisions of this
Agreement, nor does ART know of any basis for any such action, claim, suit,
proceeding or investigation.
4.4. Consents and Approvals of Government Authorities. Except for the FCC
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Consent, and the expiry or earlier termination of the waiting period under the
HSR Act, and except for any consent, approval of filing which will have been
made or obtained prior to Closing, no consent, approval or filing with any court
or governmental or regulatory authority is required to be made or obtained by
ART in connection with its execution, delivery and performance of this
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Agreement.
4.5. Stock. The Common Stock issued as the Consideration, when issued
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hereunder, will be duly authorized, validly issued, fully paid and
nonassessable.
4.6. FCC Regulatory Matters. Except in each case as would not have a
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material adverse effect on ART or the transactions contemplated hereby, ART is
in compliance with the Communications Act and the rules, regulations and
policies of the FCC promulgated thereunder applicable to ART or its assets, and
ART is in compliance with all other federal, state and local laws, rules,
regulations and ordinances applicable to ART or its assets and is not in default
under any order, writ, injunction or decree of any court or government agency or
instrumentality. ART knows of no facts pertaining to its qualifications to be a
licensee which would cause the FCC not to issue approval with respect to, or
otherwise prevent, the transfer to ART pursuant to this Agreement of the
Licensees (other than those relating to the wireless communications industry or
39 GHz Licenses generally).
4.7. SEC Filings; Financial Statements.
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(a) ART has filed with the Securities and Exchange Commission (the
"SEC") all reports, schedules, forms, statements and other documents
required by the Securities Act or the Securities Exchange Act of 1934, as
amended (the "Exchange Act") to be filed by ART since January 1, 1999 as
filed on or before the date of this Agreement (collectively, and in each
case including all exhibits and schedules thereto and documents
incorporated by reference therein the "ART SEC Reports"). As of their
respective dates (except if revised or superseded by a subsequent filing on
or before the date of this Agreement, as of such date), the ART SEC Reports
(including the financial statements included therein) (i) complied as to
form in all material respects with the requirements of the Securities Act
or the Exchange Act, as the case may be, and the rules and regulations
thereunder, and (ii) did not contain any untrue statement of a material
fact or omit to state a material fact required to be stated therein or
necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading. ART has filed
with the SEC as exhibits to the ART SEC Reports all agreements, contracts
and other documents or instruments required to be so filed, and such
exhibits are in all material respects true and complete copies of such
agreements, contracts and other documents or instruments, as the case may
be (subject to any confidential treatment requests allowing excision of
confidential information from the publicly filed document). None of ART's
subsidiaries is required to file any reports, schedules, statements or
other documents with the SEC.
(b) The consolidated balance sheets of ART and its consolidated
subsidiaries as of each of December 31, 1998 and September 30, 1999 and the
related consolidated statements of income (loss) and stockholders' equity
and cash flows for the 12 month period and the nine month period then
ended, true and complete copies of which have been
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made available to BCI, fairly present ART's consolidated financial position
as of their respective dates and its consolidated results of operations and
cash flows for the respective periods then ended, in accordance with U.S.
generally accepted accounting principles applied on a consistent basis
except as described in the footnotes to the financial statements.
(c) Since January 1, 1999, to Art's knowledge, there has been no
material disagreement (within the meaning of Item 304(a)(1)(iv) of
Regulation S-K under the Securities Act) between ART and its independent
accountants with respect matters of accounting principles or practices,
financial statement disclosure or auditing scope or procedures which if not
resolved to the satisfaction of such accountant would cause it to make a
reference to the subject matter of the disagreements in connection with its
report.
4.8. Brokerage. There are no claims for brokerage commissions or finder's
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fees or similar compensation in connection with the transactions contemplated by
this Agreement based on any arrangement or agreement made by or on behalf of
ART.
5. Registration Rights. If ART at any time proposes to file a Registration
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Statement (as defined below) for the sale by ART of its Common Stock, it will,
prior to such filing, give notice to BCI (or the Included Transferees, as
defined below; the Included Transferees and BCI, together the "Holders") of its
intention to do so and, upon written request of any of the Holders given within
15 days after ART provides such notice (which request shall state the intended
method of disposition of such Registrable Shares (as defined below)), ART shall
use its reasonable efforts to cause all Registrable Shares which ART has been
requested by any of the Holders to register to be registered under the
Securities Act of 1933 and the rules and regulations thereunder (the "Securities
Act") to the extent necessary to permit their sale or other disposition in
accordance with the intended methods of disposition specified in the request
specified in such Holders' request, provided that ART shall have the right to
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postpone or withdraw any registration effected pursuant to this Section 5 and
shall incur no liability to any Holder for doing so. ART hereby agrees to pay,
all Registration Expenses (as defined below) in connection with each
registration of Registrable Shares requested pursuant to this Section 5. For
purposes hereof, an "Included Transferee" shall include BCI, Stockholder and up
to 10 other persons holding Registrable Shares originally issued to BCI, or an
affiliate, as the case may be, as Consideration hereunder (or under the Rights
Agreement) and designated by a Bachow Entity as an Included Transferee provided
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that (i) BCI, or such affiliate, has given ART notice of such transfer and (ii)
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such transferee agrees in writing to be bound by all the provisions of this
Section 5. In the event, prior to Closing, ART files a so called "shelf"
Registration Statement under Rule 415 under the Securities Act with respect to
which a Holder would have rights to include Registrable Shares if they were then
issued, BCI shall have the right to include in such Registration Statement up to
a reasonable estimate of the number of shares of Common stock to be issued as
the Consideration, all subject to the other provisions of this Section 5, as if
such shares were then issued.
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5.1. "Rule 144" means Rule 144 promulgated under the Securities Act, and
any successor rule or regulation thereto, and in the case of any referenced
section of such rule, any successor section thereto, collectively and as from
time to time amended and in effect.
5.2. "Registration Statement" means a registration statement filed by ART
with the SEC for a public offering and sale of ART's Common Stock (other than a
registration statement on Form S-4 or Form S-8, or their successors, or any
other form for a similar limited purpose, or any registration statement covering
solely securities proposed to be issued in exchange for securities or assets of
another corporation or other entity in a merger, consolidation, acquisition,
exchange offer, or other transaction).
5.3. "Registrable Shares" means the shares of ART Common Stock received by
BCI or any other Holder as part of the Consideration in the transaction
contemplated hereby or (ii) pursuant to a closing under the Rights Agreement;
provided that any shares which are Registrable Shares shall cease to be
-------------
Registrable Shares: (i) upon any sale thereof pursuant to a Registration
Statement, Rule 144, or otherwise in a public offering; (ii) upon any assignment
thereof except to and included Transferee; or (iii) when, in the opinion of
counsel satisfactory to ART, such shares become eligible for sale under
paragraph (k) of Rule 144.
5.4. "Registration Expenses" means all expenses incident to performance of
or compliance with Section 5 hereof by ART, including without limitation all
listing fees, all fees and expenses of complying with securities or blue sky
laws, all printing and automated document preparation expenses, all messenger
and delivery expenses, the fees and disbursements of counsel for ART and of its
independent public accountants, including the expenses of any special audits
required by or incident to such performance and compliance, underwriting
discounts and commissions and applicable transfer taxes, if any. Notwithstanding
the foregoing, the Holders shall, on a pro-rata basis, pay all registration and
filing fees and underwriting commissions and discounts and transfer taxes
attributable to the Registrable Shares and all fees and disbursements of their
individual counsel and advisors.
5.5. Cutbacks. In connection with any registration under this Section 5
--------
involving an underwriting, ART shall not be required to include any Registrable
Shares in such registration unless Holders accept the terms of the underwriting
as agreed between ART and the underwriters selected by it. If the managing
underwriter advises ART that the inclusion of Registrable Shares or other shares
proposed to be included in such registration would interfere with the successful
marketing (including pricing) of shares for ART's account proposed to be
registered by ART, then ART shall be required to include in the registration
only that number of Registrable Shares, if any, which the managing underwriter
believes should be included therein. In such case, the securities so included
shall be reduced as follows: (i) all shares which stockholders other than ART,
the Holders and other persons or entities holding registration rights seek to
include in the registration shall be excluded from the registration to the
extent limitation on the number of shares included in the registration is
required; and (ii) if further limitation on the number of shares to be included
in the registration is required, then the shares to be registered shall include:
(a) first,
-12-
shares to be registered by ART, (b) second, those shares held by the persons or
entities holding registration rights which by their terms are prior to the
rights of BCI the agreements for which are set forth on Schedule 5.5; and, if
pursuant to a demand by persons having so called "demand registration rights",
the shares such parties hold, and (c) third shares held by all other persons or
entities holding registration rights, including BCI's Registrable Shares, if
any. If pursuant to clause (c) of the prior sentence other persons or entities
holding registration rights seek to register such rights then the Holders and
such other persons or entities shall participate in the registration pro rata
based upon their total ownership of shares of Common Stock (giving effect to the
conversion into Common Stock of all securities convertible thereunto). If any
holder of registration rights would thus be entitled to include more shares than
such holder requested to be registered, the excess shall be allocated among
other requesting holders pro rata in the manner described in the preceding
sentence. ART will not grant new piggyback registration rights with priorities
greater than the piggyback registration rights of the Holders.
5.6. Information Provided by the Holders. ART may require Holders, as a
-----------------------------------
condition to registering any Registrable Securities, to furnish ART such
information regarding the Holders and the distribution of such securities as ART
may from time to time reasonably request in writing and which shall be required
by the Securities Act (or similar state laws) or by the Commission in connection
therewith.
5.7. Filing Requirements. Until the date two years following the last
-------------------
issuance of Common Stock to BCI pursuant to this Agreement or to the Holders
pursuant to the Rights Agreement, ART shall timely file with the SEC such
information as the SEC may prescribe under Section 13 or 15(d) of the Exchange
Act and the rules and regulations of the SEC thereunder and otherwise use its
reasonable efforts to ensure that the public information requirements of Rule
144 are satisfied with respect to ART.
5.8. Indemnification.
---------------
(a) Indemnities of ART. In the event of any registration of any
------------------
Registrable Securities under the Securities Act pursuant to this Section 5,
ART will indemnify and hold harmless each Holder and each other Person, if
any, who controls such Holder within the meaning of Section 15 of the
Securities Act, against any losses, claims, damages or liabilities, joint
or several, to which such Person may be or become subject under the
Securities Act and any other securities or other law of any jurisdiction,
common law or otherwise, insofar as such losses, claims, damages or
liabilities (or actions or proceedings in respect thereof) arise out of or
are based upon: (i) any untrue statement or alleged untrue statement of any
material fact contained or incorporated by reference in any registration
statement under the Securities Act, any preliminary prospectus or final
prospectus included therein, or any related summary prospectus, or any
amendment or supplement thereto, or any document incorporated by reference
therein; or (ii) any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the
statements therein not misleading, and will reimburse Holders
-13-
for any legal or any other expenses incurred by them in connection with
investigating or defending any such loss, claim, damage, liability, action
or proceeding; provided, however, that ART shall not be liable to Holders
-------- -------
in any such case for any such loss, claim, damage, liability, action or
proceeding: (i) to the extent that it arises out of or is based upon an
untrue statement or alleged untrue statement or omission or alleged
omission made in such registration statement, any such preliminary
prospectus, final prospectus, summary prospectus, amendment or supplement
or incorporated document, in reliance upon and in conformity with written
information furnished to ART or expressly for use therein or on behalf of
such Holder; or (ii) such untrue statement or alleged untrue statement or
omission or alleged omission was contained in a preliminary prospectus and
corrected in a final or amended prospectus, and the Holders failed to
deliver a copy of the final or amended prospectus at or prior to the
confirmation of the sale of the Registrable Shares to the person asserting
any such loss, claim, damage or liability in any case in which such
delivery is required by the Securities Act. The indemnities of ART
contained in this Section 5.8 shall remain in full force and effect
regardless of any investigation made by or on behalf of the Holders.
(b) Indemnities of BCI or Other Holders. In the event of any
-----------------------------------
registration of any Registrable Securities pursuant to this Section 5, each
Holder will indemnify and hold harmless (in the same manner and to the same
extent as set forth in Section 5.8 hereof) ART, each director of ART, each
officer of ART who shall sign such registration statement and each other
Person (other than BCI), if any, who controls ART within the meaning of
Section 15 of the Securities Act, with respect to any statement in or
omission from such registration statement, any preliminary prospectus or
final prospectus included therein, or any amendment or supplement thereto,
or any document incorporated therein, if such statement or omission was
made in reliance upon and in conformity with written information furnished
to ART expressly for use therein by or on behalf of such Holder. Such
indemnity shall remain in full force and effect regardless of any
investigation made by or on behalf of ART or any such director, officer or
controlling Person; provided that the obligation to indemnify will be
-------- ----
individual to each Holder and will be limited to the proceeds (net of
underwriting discounts and commissions) received by such Holder from the
sale of Registrable Stock pursuant to such Registration Statement.
(c) Indemnification Procedures. Promptly after receipt by an
--------------------------
indemnified party of notice of the commencement of any action or proceeding
involving a claim of the type referred to in the foregoing provisions of
this Section 5.8, such indemnified party will, if a claim in respect
thereof is to be made against any indemnifying party, give written notice
to each such indemnifying party of the commencement of such action;
provided, however, that the failure of any indemnified party to give notice
to such indemnifying party as provided herein shall not relieve such
indemnifying party of its obligations under the foregoing provisions of
this Section 5.8, except and solely to the extent that such indemnifying
party is actually prejudiced by such failure to give notice. In case any
such action is brought against an indemnified party, each indemnifying
party will be entitled to
-14-
participate in and to assume the defense thereof, jointly with any other
indemnifying party similarly notified, to the extent that it may wish, with
counsel reasonably satisfactory to such indemnified party (who shall not,
except with the consent of the indemnified party, be counsel to such an
indemnifying party), and after notice from an indemnifying party to such
indemnified party of its election so to assume the defense thereof, such
indemnifying party will not be liable to such indemnified party for any
legal or other expenses subsequently incurred by the latter in connection
with the defense thereof; provided, however, that: (i) if the indemnified
-------- -------
party reasonably determines that there may be a conflict between the
positions of such indemnifying party and the indemnified party in
conducting the defense of such action or that there may be defenses
available to such indemnified party different from or in addition to those
available to such indemnifying party, then counsel for the indemnified
party shall conduct the defense to the extent reasonably determined by such
counsel to be necessary to protect the interests of the indemnified party
and such indemnifying party shall employ separate counsel for its own
defense; (ii) in any event, the indemnified party shall be entitled to have
counsel chosen by such indemnified party participate in, but not conduct,
the defense; and (iii) the indemnifying party shall bear the legal expenses
incurred in connection with the conduct of, and the participation in, the
defense as referred to in clauses (i) and (ii) above. If, within a
reasonable time after receipt of the notice, such indemnifying party shall
not have elected to assume the defense of the action, such indemnifying
party shall be responsible for any legal or other expenses incurred by such
indemnified party in connection with the defense of the action, suit,
investigation, inquiry or proceeding. No indemnifying party will consent to
entry of any judgment or enter into any settlement which does not include
as an unconditional term thereof the giving by the claimant or plaintiff to
such indemnified party of a release from all liability in respect to such
claim or litigation.
(d) Contribution. If the indemnification provided for in this
------------
Section 5.8 hereof is unavailable to a party that would have been an
indemnified party under this Section 5.8 in respect of any losses, claims,
damages or liabilities (or actions or proceedings in respect thereof)
referred to therein, then each party that would have been an indemnifying
party thereunder shall, in lieu of indemnifying such indemnified party,
contribute to the amount paid or payable by such indemnified party as a
result of such losses, claims, damages or liabilities (or actions or
proceedings in respect thereof) in such proportion as is appropriate to
reflect the relative fault of such indemnifying party on the one hand and
such indemnified party on the other in connection with the statements or
omissions which resulted in such losses, claims, damages or liabilities (or
actions or proceedings in respect thereof). The relative fault shall be
determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by such
indemnifying party or such indemnified party and the parties' relative
intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission. The parties agree that it would not be
just and equitable if contribution pursuant to this Section 5.8 were
determined by pro rata allocation or by any other method of allocation
which does not take
-15-
account of the equitable considerations referred to in the preceding
sentence. The amount paid or payable by a contributing party as a result of
the losses, claims, damages or liabilities (or actions or proceedings in
respect thereof) referred to above in this Section 5.8 shall include any
legal or other expenses reasonably incurred by such indemnified party in
connection with investigating or defending any such action or claim. The
obligation to contribute will be individual to each Holder and will be
limited to the amount of proceeds (net of underwriting discounts and
commissions) received by such Holder from the sale of Registrable Stock
pursuant to such Registration Statement. No Person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities
Act) shall be entitled to contribution from any Person who was not guilty
of such fraudulent misrepresentation.
5.9. ART's Obligations in Registration. Whenever ART is obligated, by the
---------------------------------
provisions of this Section 5, to effect the registration of any Registrable
Shares under the Securities Act, ART shall (a) furnish to the Holders for whom
such Registrable Shares are registered or are to be registered and to the
underwriter, if any, such numbers of copies of a prospectus, including a
preliminary prospectus and any amendments or supplements thereto, in conformity
with the requirements of the Securities Act, (b) register or qualify the
Registrable Shares covered by such registration statement at the expense of such
Holder (if such expense is in addition to those incurred by ART in registering
or qualifying shares to be sold by ART in such registration) under such state
securities or blue sky laws of such jurisdictions as the Holders for whom such
Registrable Shares are registered or are to be registered shall reasonably
request in light of any distribution being then contemplated, except that ART
shall not for any purpose be required to execute a general consent to service of
process or to qualify to do business as a foreign corporation in any
jurisdiction where it is not so qualified; (c) notify each Holder of such
Registrable Shares, at any time when a prospectus relating thereto is required
to be delivered under the Securities Act, of the happening of any event as a
result of which the prospectus included in such registration statement contains
an untrue statement of a material fact or omits any fact necessary to make the
statements therein not misleading; and (d) cause all such Registrable Shares to
be listed on the Nasdaq Stock Market or on such other exchange on which
securities of the same class as the Registrable Shares are then primarily
listed.
6. Expenses. ART shall assume and satisfy up to an aggregate of $3 million of
--------
the fees and expenses incurred by BCI in connection with the Transaction,
including BCI's legal and accounting expenses and fees and expenses payable by
BCI to the firm of Xxxxxxx & Associates L.P., but only to the extent that such
--------
fees and expenses are set forth on a detailed schedule identifying the party and
amount owned delivered to ART by BCI at Closing (all such fees and expenses
assumed by ART collectively, the "Assumed Expenses"). ART will not assume or
bear any expenses, fees or liabilities other than as provided in Section 1.2
and this Section 6. The Bachow Entities shall remain responsible for and shall
satisfy any amounts not shown on the schedule referenced above and for any
amounts above $3 million.
7. Survival of Representations and Warranties. All representations,
------------------------------------------
warranties and
-16-
agreements of BCI and ART contained herein (including all schedules and exhibits
hereto) or in any document, statement, certificate or other instrument referred
to herein or delivered at the Closing in connection with the transactions
contemplated hereby shall survive (i) the execution and delivery of this
Agreement, (ii) any investigation by ART of the Bachow Entities or the Assets,
and (iii) the Closing and the consummation of the transactions contemplated by
this Agreement provided, however, that such representations and warranties shall
-------- -------
only survive two years after the Closing.
8. Indemnities. In addition to the indemnities provided under Section 5.8
-----------
hereof, the parties agree as follows.
8.1. Indemnification by BCI. BCI shall indemnify and hold harmless ART
----------------------
and it ssuccessors and assigns for any and all damages, claims, losses,
liabilities, and expenses, including without limitation reasonable legal and
accounting expenses (collectively, "Losses"), which may arise out of: (i) any
breach of BCI's covenants and agreements hereunder; (ii) any inaccuracy or
misrepresentation in any representation or warranty of BCI hereunder, or any
inaccuracy or misrepresentation in any certificate or document delivered in
accordance with the terms of this Agreement by the Bachow Entities; (iii) any
liabilities of BCI other than Assumed Liabilities; or (iv) any claim or action
asserted by any third party arising out of or in connection with any event, act
or omission relating to any of the Assets occurring prior to the Closing (other
than (a) those relating to the wireless communications industry or 39 GHz
Licenses generally and (b) to the extent caused by any act of ART under, or
failure of ART to fulfill its obligations under, the Management Agreement). BCI
shall not be liable for indemnification claims under this Section 8.1 unless BCI
is given notice of the claim by ART within two years following the Closing. To
the extent feasible BCI may satisfy its obligations under this Section 8.1 by
delivering to ART shares of ART stock; provided, however, that any Losses that
-------- -------
result in cash out-of-pocket expenditures by ART must be satisfied by BCI with
cash, unless otherwise agreed. Shares delivered in satisfaction of obligations
under this Section 8.1 shall be valued at $36 per share.
8.2. Limitation. Notwithstanding Section 8.1, BCI shall have no obligation
----------
to indemnify ART and its successors and assigns pursuant to this Section 8 until
the aggregate of all Losses suffered or incurred by ART and such other persons
exceeds $250,000, in which case ART may recover for all Losses. BCI's maximum
liability for indemnification shall be the value of the Consideration net of all
taxes paid or payable (giving effect to the tax effect of any indemnity
payments).
8.3. Indemnification by ART. ART shall indemnify and hold harmless BCI
----------------------
and its respective successors and assigns from and against any and all Losses
which may arise out of: (i) any breach of any of ART's covenants and agreements;
or (ii) any inaccuracy or misrepresentation in any representation or warranty of
ART hereunder, or any inaccuracy or misrepresentation in any certificate or
document delivered to the Bachow Entities in accordance with the terms of this
Agreement to ART shall not be liable for indemnification claims under this
Section 8.3 unless ART is given notice of the claim by BCI within two years
following the
-17-
Closing. Notwithstanding Section 8.3, ART shall have no obligation to indemnify
BCI and its successors and assigns pursuant to this Section 8 until the
aggregate of all Losses suffered or incurred by BCI and such other persons
exceeds $250,000, in which case BCI may recover for all Losses.
8.4. Exclusive Remedy. The indemnification provisions in this Section 8
----------------
shall constitute the sole remedies for any claim brought after Closing in
connection with this Agreement or any of the transactions contemplated hereby,
except for a claim arising under Section 5 or from a breach of a covenant or
agreement.
9. Covenants.
---------
9.1. FCC and Other Approval.
----------------------
(a) BCI and ART will use its best efforts to join in and submit as
soon as practicable, and in no event later than ten business days after the
Signing Date, one or more applications (the "Applications") to the FCC as
deemed by BCI and ART to be appropriate requesting the FCC's written
consent to the assignment of the Licenses to ART or designees of ART.
(b) Each of BCI, and its ultimate parent, as applicable, and ART
will use its best efforts to comply with the Xxxx-Xxxxx-Xxxxxx Antitrust
Improvements Act of 1976, as amended, and the rules and regulations
promulgated thereunder (the "HSR Act"). Each of BCI, and its ultimate
parent entity, and ART will file as soon as practicable, and in no event
later than fifteen business days after the Signing Date, any Notification
and Report Forms and related material that it may be required to file with
the Federal Trade Commission and the Antitrust Division of the United
States Department of Justice under the HSR Act. Each party shall pay its
own filing fees.
(c) ART and BCI shall each pay the fees charged to it by the FCC in
connection with its Application, and the cost of publishing any public
notices in connection therewith.
9.2. Further Assurances. At any time and from time to time at or after
------------------
the Closing, at the request of ART and without further consideration, BCI will
execute and deliver such other instruments of sale, transfer, conveyance,
assignment and confirmation and take such action as ART may reasonably determine
is necessary to transfer, convey and assign to ART, and to confirm ART's title
to or interest in the Assets.
9.3. Public Announcements. (a) Prior to the Closing, without the prior
--------------------
written consent of the other party, neither BCI nor ART (nor their respective
affiliates, representatives or advisors) will, and each will direct its
respective representatives or advisors not to, directly or indirectly, make any
public comment, statement or communication with respect to, or otherwise
disclose or permit the disclosure of, this Agreement, the other agreements and
transactions contemplated hereby, or the specific matters discussed between the
parties, and (b) after the
-18-
Closing, BCI (nor its respective affiliates, representatives or advisors) will
not and will direct its affiliates, representatives or advisors not to, at any
time, without the prior written consent of ART, make any announcement, issue any
press release or make any statement to any third party with respect to this
Agreement, the agreements and transactions contemplated hereby, or any of the
specific matters discussed between the parties; provided, with respect to both
(a) and (b) of this Section 9.3 BCI and ART may each communicate with its or
their representatives and advisors concerning these matters and any party may
make any disclosure required by law (including, without limitation, the HSR Act)
or the rules of the FCC or Nasdaq.
9.4. Information and Access; Compliance. During the period from the date
----------------------------------
of this Agreement and continuing until the Closing or until the termination of
this Agreement pursuant to Section 12 hereof, BCI shall afford ART and its
representatives and advisors with reasonable access to BCI and the Assets and
all matters and information that any of them may reasonably request. The
provisions of access pursuant to this Section 9.4 shall in no way affect or
otherwise obviate or diminish any representations and warranties of BCI. The
parties shall take all reasonable actions necessary to comply promptly with all
legal requirements which may be imposed on such party with respect to this
Agreement and the transactions contemplated hereby (including furnishing all
information required by the FCC, the Federal Trade Commission or the Department
of Justice in connection with transfer of the Licenses) and shall take all
reasonable actions necessary to cooperate promptly with and furnish information
to the other party in connection with any such requirements imposed upon such
other party in connection with this Agreement and the transactions contemplated
hereby. Neither the Bachow Entities nor ART shall take any action that shall
have the foreseeable effect of preventing the Closing of the transactions
contemplated hereby.
9.5. Conduct of Business by BCI. BCI covenant that, without ARTs written
--------------------------
consent, it shall not:
(a) sell, transfer, convey or otherwise dispose of any of the
Assets or any right thereto or interest therein except termination of
leases not material to the business and transfers in accordance herewith;
(b) encumber, or agree to encumber, in any way, or enter into any
consensual restriction with respect to, any of the Assets or any right
thereto or interest therein;
(c) enter into any contract, agreements or understanding with
respect to any of the Assets, other than leases terminable at will;
(d) take any action which, or reasonably fail to take any action
the failure of which, would cause either BCI's disqualification as an
assignor of the Licenses, or would materially adversely affect the Assets
or ART's or BCI's rights with respect thereto; or
(e) enter into any agreements or commitments for any of 9.5(a)
through 9.5(d).
-19-
9.6. Legend Removal. On or after the date two years following the
--------------
issuance of any Security to BCI, upon the request of BCI (or any transferee) if
BCI or such transferee, as the case may be, is not an "affiliate" (as defined in
Rule 144 of the Securities Act) of ART, ART shall issue to BCI (or such
transferee) a replacement certificate for the Securities without the legend
referenced in Section 3.14.
10. Conditions Precedent to ART's Obligations. The obligations of ART to
-----------------------------------------
consummate the transactions contemplated hereby shall be subject to the
fulfillment by BCI prior to or at the Closing, of each of the following
conditions, any of which may be waived by ART in its sole discretion:
10.1. Representations and Warranties. The representations and warranties
------------------------------
made by BCI in this Agreement (including all exhibits and schedules hereto),
shall be true and correct in all material respects when made and shall be
repeated and shall be true and correct in all material respects at and as of the
Closing Date (except insofar as any of those representations and warranties are
expressly qualified by reference to any earlier or later date and except insofar
as an act by ART under the Management Agreement or failure to perform its
obligations thereunder causes such representations and warranties to be untrue
or incorrect), and ART shall have received a certificate dated the date of the
Closing signed by the chief executive officer of BCI to the foregoing effect.
10.2. Consents. All material filings with and consents from all federal,
--------
state and local governmental agencies required to consummate the transactions
contemplated by this Agreement shall have been made or received, as applicable.
10.3. FCC Licenses. Without limiting the generality of Section 10.2, the
------------
FCC shall have consented to the assignment of all of the Licenses by a Final
Order (as defined below), without any conditions or restrictions that materially
affect the value of the Licenses or operations pursuant to the Licenses or any
conditions or restrictions materially different than the normal authorizations
issued by the FCC to other 39 GHz license holders at the date of the Closing. In
the event that any FCC order approving the transfer of the Licenses to ART
imposes such conditions, this condition shall not be satisfied until such
conditions are removed or eliminated, and BCI and ART shall cooperate with one
another in obtaining the removal or elimination of such restrictions. "Final
Order" means an action by the FCC giving its consent to the assignment of the
Licenses, with respect to which no request for stay, petition for rehearing,
reconsideration or appeal is pending, and as to which the time for filing any
petition for rehearing, reconsideration or appeal has expired and with respect
to which the time for agency reconsideration or review taken on its own motion
has expired, or in the event of the filing of such request, petition or appeal,
an action which shall have been reaffirmed or upheld and with respect to which
the time for seeking further administrative or judicial review shall have
expired.
10.4. Changes. There shall not have been any material adverse change
-------
specific to the Licenses, it being understood that changes affecting 39 GHz
Licenses generally and changes external to BCI and its business such as changes
in demographics, the industry or the economy
-20-
shall not be deemed specific to the Licenses.
10.5. HSR Matters. All applicable waiting periods (and any extensions
-----------
thereof) under the HSR Act shall have expired or otherwise been terminated.
10.6. Performance by BCI; Certificate. BCI shall have performed and
-------------------------------
complied in all material respects with all agreements and conditions required by
this Agreement to be performed or complied with by them prior to or at the
Closing, and the chief executive officer of BCI shall deliver to ART a
certificate dated the Closing Date to such effect.
10.7. Opinions of Counsel for BCI. ART shall have received favorable
---------------------------
opinions addressed to it and dated the Closing Date of counsel and FCC counsel
for BCI, in substantially the form set forth in Exhibits B and C, respectively.
10.8. Absence of Litigation. No action or proceeding shall be pending
---------------------
against BCI or involving the Assets at the Closing Date before any court or
governmental body or authority which could be materially adverse to the Assets.
There shall not be in existence any court order or order of any governmental
agency or body which prevents or makes illegal the consummation of the
transactions contemplated hereby.
10.9. Release of Liens. All of the Assets shall be free and clear of all
----------------
liens and ART shall have received evidence of the release of all Liens and the
termination of all financing statements, if any, as may be reasonably requested
by ART.
11. Conditions Precedent to the Obligations of the BCI. The obligations of BCI
--------------------------------------------------
to consummate the transactions contemplated hereby shall be subject to the
fulfillment by ART prior to or at the Closing, of each of the following
conditions, any of which may be waived by BCI in its sole discretion:
11.1. Representations and Warranties. The representations and warranties
------------------------------
made by ART in this Agreement shall be true and correct in all material respects
when made and shall be repeated and shall be true and correct in all material
respects at and as of the Closing Date (except insofar as any of the
representations and warranties are expressly qualified by reference to an
earlier or later date), and BCI shall have received a certificate dated the date
of Closing signed by an officer of ART to the foregoing effect.
11.2. HSR Matters. All applicable waiting periods (and any extensions
-----------
thereof) under the HSR Act shall have expired or otherwise been terminated.
11.3. Government Consents. All material filings with and consents from all
-------------------
federal, state and local governmental agencies required to consummate the
transactions contemplated hereby shall have been obtained at or prior to the
Closing.
11.4. Performance of ART. ART shall have performed and complied in all
------------------
material
-21-
respects with all agreements and conditions required by this Agreement to be
performed or complied with by it prior to or at the Closing and an executive
officer of ART shall deliver to BCI a certificate dated the Closing Date to such
effect.
11.5. Absence of Litigation. There shall not be in existence any court
---------------------
order or order of any governmental agency or body which prevents or makes
illegal the consummation of the transactions contemplated hereby.
11.6. Consideration. The Consideration shall have been delivered to BCI.
-------------
11.7. Material Adverse Change. There shall not have occurred with respect
-----------------------
to any issue of debt of ART having an outstanding principal amount of $5,000,000
or more (i) an event of default that has caused the holder thereof to declare
such indebtedness to be due and payable prior to its stated maturity and such
indebtedness has not been discharged in full or such acceleration has not been
rescinded or annulled within 30 days of such acceleration, (ii) the failure to
make a payment of principal or interest when due that has not been made, waived
or extended within 5 days of such payment default, or (iii) if ART is not
generally paying its debts as they come due, admits its inability to pay its
debts as they come due, or if ART commences, or there is commenced against ART
and undismissed, any proceedings under any bankruptcy, insolvency or
reorganization law.
11.8. Opinion of Counsel for ART. BCI shall have received a favorable
--------------------------
opinion addressed to it and dated the Closing Date of counsel for ART in
substantially the form set forth in Exhibit D.
12. Termination. This Agreement may be terminated prior to the Closing by the
-----------
parties as set forth in this Section 12.
(a) at any time by the mutual written consent of BCI and ART;
(b) by ART at any time after April 1, 2001 (the "End Date"), if the
conditions set forth in Section 10 hereof shall not have been complied with
or performed and such noncompliance or nonperformance shall not have been
cured or eliminated by BCI by such time provided that if prior to the End
Date, the FCC has issued an order, that is not yet a Final Order, approving
the transfer or change in control, as applicable, of the Licenses, to ART,
BCI may extend the End Date until May 15, 2001 by notice to ART;
(c) by BCI at any time after the End Date, if the conditions set
forth in Section 11 hereof shall not have been complied with or performed
and such noncompliance or nonperformance shall not have been cured or
eliminated by ART by such time provided that if prior to the End Date, the
FCC has issued an order, that is not yet a Final Order, approving the
transfer or change in control, as applicable, of the Licenses, to ART, ART
may extend the End Date until May 15, 2001 by notice to BCI; or
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(4) by BCI on the one hand, or by ART on the other, if there shall
have been a breach of any representation, warranty, covenant or agreement
on the part of the other set forth or contemplated by this Agreement, which
breach cannot be cured prior to the Closing and which would result in the
failure by the non-terminating party to satisfy one or more conditions to
Closing hereunder;
provided, however, that the terminating party may not terminate its obligations
-------- -------
under this Agreement if such terminating party has breached this Agreement or
the Management Agreement in any material respect.
Notwithstanding any termination of this Agreement pursuant to this Section
12, the provisions of Sections 8 hereof shall remain in full force and effect
and no termination of this Agreement pursuant to Section 12(b), (c) or (d) shall
relieve a breaching party of any liability hereunder for any such breach
occurring prior to termination.
13. Regulatory Matters. Each party hereto recognizes that it is subject to
------------------
certain FCC rules and other laws and is under an obligation to, among other
things, disclose the existence of agreements relating to post auction market
structures at the time such party files its FCC Form 175 in connection with FCC
Auction No. 30 (the 39 GHz spectrum auction). The parties further recognize that
this Agreement is limited by its terms to the acquisition of specified licenses
and does not constitute an agreement relating to any party's conduct in the
auction with respect to bid amounts, bid strategies or the markets that each
bidder will or will not bid upon during the auction. The parties also recognize
that, after the filing of the FCC Form 175, they may not engage in any
prohibited discussion with the other of bid amounts, bid strategies or the
markets each bidder will or will not bid upon during the auction.
14. Entire Agreement; Assignability. This Agreement, together with the Rights
-------------------------------
Agreement, the Management Agreement and the schedules and exhibits hereto,
constitutes the entire agreement between the parties hereto pertaining to the
subject matter hereof and supersedes all prior and contemporaneous agreements,
understandings, negotiations and discussions, whether oral or written, of the
parties, and there are no warranties, representations or other agreements
between the parties in connection with the subject matter hereof except as
specifically set forth herein. This Agreement (or any part thereof) may not be
assigned by any party hereto without the prior written consent of the other
parties hereto and any such attempted assignment shall be null and void, except
to the extent that the assignment of Securities confers rights upon Holders.
15. Amendment. This Agreement may be amended by the parties hereto at any
---------
time, but only by an instrument in writing duly executed and delivered on behalf
of each of the parties hereto.
16. Headings. Section headings are not to be considered part of this Agreement
--------
and are included solely for convenience and are not intended to be full or
accurate descriptions of the contents thereof. References to Sections are to
portions of this Agreement unless the context requires otherwise.
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17. Exhibits, etc. Exhibits, schedules and other documents referred to in this
-------------
Agreement are an integral part of this Agreement.
18. Successors and Assigns. All of the terms and provisions of this Agreement
----------------------
shall be binding upon and shall inure to the benefit of the parties hereto and
their respective transferees, successors and assigns.
19. Notices, etc. All notices, requests, demands and other communications
------------
hereunder shall be in writing and shall be deemed to have been duly given on the
date of delivery if delivered or mailed, first-class postage prepaid,
(a) if to BCI, to: Bachow Communications, Inc.
Three Xxxx Xxxxx Xxxx, Xxxxx 000
Xxxx Xxxxxx, Xxxxxxxxxxxx 00000
Attention: Xxxx X. Xxxxxx
with a copy (which shall
not constitute notice) to: Drinker Xxxxxx & Xxxxx LLP
Xxx Xxxxx Xxxxxx
Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000-0000
Attention: Xxxxxx X. Xxxx, Esq.
Fax: 000-000-0000
(b) if to ART to: Advanced Radio Telecom Corp.
000 000xx Xxxxxx, XX, Xxxxx 0000
Xxxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxx, Esq.
with a copy to (which shall
not constitute notice) to: Ropes & Xxxx
Xxx Xxxxxxxxxxxxx Xxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000-0000
Attention: Xxxx X. Xxxxx, Esq.
20. Governing Law. This Agreement and the rights and obligations of the
-------------
parties hereto arising out of this Agreement shall be governed by and construed
in accordance with the laws of the State of Delaware without regard to the
internal conflict of law provisions thereof.
21. Severability. The provisions of this Agreement are severable, and if any
------------
one or more provisions are deemed illegal or unenforceable, the remaining
provisions shall remain in full force and effect.
22. Counterparts. This Agreement may be executed simultaneously in any number
------------
of
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counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
[The remainder of this page has been intentionally left blank]
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IN WITNESS WHEREOF, the parties hereto have duly executed this Asset
Purchase Agreement as of the day and year first above written.
BACHOW COMMUNICATIONS, INC.
By: ________________________________
Name:
Title:
ADVANCED RADIO TELECOM CORP.
By: ________________________________
Name:
Title:
SCHEDULE 1.1 - ASSETS
LICENSES
Channel Latitude Longitude Status of any
Licensee Market Call Sign Pops Sq. Miles Minimum Maximum Minimum Maximum Expiration Date FCC Application
----------------- --------- --------------- ------- ------- ------- ------- ---------------------------------
LEASES
Landlord Address Monthly Rent Contact Person
--------------------------------------------------------------------------------
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Guaranty
Xxxx X. Xxxxxx, the sole shareholder of BCI ("Guarantor"), hereby
guarantees that the obligations of BCI under Section 5.8 and Section 8.1 (the
"Obligations") will be paid in full when due and payable ("Guaranty"). This
Guaranty shall be a continuing, absolute and unconditional guaranty and shall be
irrevocable and remain in full force and effect until all Obligations, shall
have been paid or provided for according to the terms of this Agreement. This
is a guaranty of payment and not of collection, and the Guarantor expressly
waives any right to require that any action be brought against BCI or to require
that resort be had to any security, whether held by or available to ART. If ART
prevails in enforcing the Guaranty, the Guarantor will pay all reasonable costs
and expenses, including reasonable attorneys' fees (whether or not suit is
brought and whether incurred at trial, upon rehearing, retrial or appeal or in
any bankruptcy proceeding), paid or incurred by ART in enforcing this Guaranty,
the amount of such attorneys' fees to be without regard to any statutory
presumption.
_________________________________
Xxxx Xxxxxx, Individually
