EXHIBIT 10.8
ASSET PURCHASE AGREEMENT
THIS ASSET PURCHASE AGREEMENT is entered into as of February 7, 2003 by
and among BizCom U.S.A., Inc., a Florida corporation (the "Parent"), Bizcom
Southern Holdings, Inc., a Florida corporation (the "Purchaser"), and certain
entities (individually, an "Equipment Owner" and collectively, the "Equipment
Owners") listed on Schedule A to the Disclosure Letter provided for and on
behalf of the Equipment Owners to the Parent and Purchaser.
WITNESSETH:
WHEREAS, each of the Equipment Owners owns certain assets, as further
described herein, which it desires to sell to the Purchaser subject to the terms
and conditions set forth in this Agreement; and
WHEREAS, the Purchaser desires to purchase such assets, as further
described herein, subject to the terms and conditions set forth in this
Agreement;
NOW, THEREFORE, in consideration of the premises, and respective
representations, warranties, covenants and agreements of each of the Equipment
Owners, Parent and Purchaser set forth in this Agreement, each of the Equipment
Owners, Parent and Purchaser agrees as follows:
ARTICLE I
DEFINITIONS
1.1 CERTAIN DEFINITIONS. The following terms shall have the following
respective meanings when utilized in this Agreement:
"Affiliate" shall mean, with respect to any specified Person,
any other Person which, directly or indirectly, controls, or is controlled by,
or is under common control with, such specified Person. For purposes of this
definition, the concept of "control," when used with respect to any specified
Person, shall signify the possession of the power to direct the management and
policies of such specified Person, directly or indirectly, whether through the
ownership of voting securities or partnership or other equity or ownership
interests, by contract or otherwise.
"Agreement" shall mean this Asset Purchase Agreement, together
with the Disclosure Letter and Schedules attached hereto.
"Assignment Application" shall mean an application seeking the
consent of the FCC to the assignment of the License to Purchaser.
"Assumed Obligations" shall have the meaning set forth in
Section 2.4(a) of this Agreement.
"Closing" shall have the meaning set forth in Section 3.1 of
this Agreement.
"Closing Date" shall have the meaning set forth in Section 3.1
of this Agreement.
"Communications Act" shall mean the Communications Act of
1934, as amended, and the rules, regulations and requirements promulgated
thereunder
"Disclosure Documents" shall have the meaning set forth in
Section 4.17(a) of this Agreement.
"Disclosure Letter " shall mean the letter provided for and on
behalf of the Equipment Owners to Parent and Purchaser together with the
Schedules attached thereto, which Disclosure Letter and Schedules shall be
deemed to be a part of the Agreement.
"Environmental Laws" shall mean any and all Governmental Rules
relating to (i) the environment, which includes without limitation ambient air,
surface water, ground water, land surface and subsurface strata, (ii) emissions,
discharges, releases or threatened releases of any Hazardous Substance into the
environment and (iii) otherwise relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport or handling of any
Hazardous Substance.
"EPA" shall mean the United States Environmental Protection
Agency.
"Equipment Lease Agreement" means that certain equipment lease
agreement dated on or about September1997 by and between each Equipment Owner
and each lessee thereof (the "Equipment "Lessee(s)"), as amended pursuant to the
terms and conditions of a limited authorization provided by each of the
Equipment Owners and Equipment Lessees to SMR Advisory Group, LC ("SMR
Advisory").
"Equipment Lessee(s)" shall have the meaning set forth in the
definition of the term "Equipment Lease Agreement" above and are identified on
Schedule A.1. to the Disclosure Letter.
"Equipment Owners" shall have the meaning set forth in the
first paragraph of the Agreement.
"Equipment Owner Purchase Price" shall have the meaning set
forth in Section 2.2 of this Agreement.
"FCC" shall mean the Federal Communications Commission.
"Final Order" shall mean an action by the FCC granting its
consent and approval to the assignment of the License to Purchaser, with respect
to which (i) no action, request for stay,
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petition for rehearing, reconsideration or appeal is pending, (ii) the time for
filing any request, petition or appeal has expired and (iii) the time for agency
action 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 without the filing of any such action for
further review.
"Governmental Approvals" shall mean any authorization,
consent, approval, license, lease, ruling, permit, tariff, rate, certification,
exemption, filing or registration by or with any Governmental Entity.
"Governmental Entity" shall mean any national, federal, state
or local government, any political subdivision thereof, or any governmental,
quasi-governmental, judicial, public or statutory instrumentality, authority,
agency, body or entity.
"Governmental Rules" shall mean any constitution, charter,
law, rule, treaty, regulation, ordinance, code, order, judgment, decree,
directive, guideline, policy, procedure or any similar form of decision of, or
any interpretation or administration of, any of the foregoing by, any
Governmental Entity.
"Hazardous Substance" shall mean any substance, material,
pollutant or contaminant which has been or shall be determined at any time by
any Governmental Entity to be a hazardous or toxic substance. Without limiting
the generality of the immediately preceding sentence, the term "Hazardous
Substance" shall include any hazardous material, hazardous substance, pollutant,
or contaminant, as those terms are defined in the Comprehensive Environmental
Response, Compensation, and Liability Act of 1980, as amended, the Resource
Conservation and Recovery Act of 1976, and the Hazardous Materials
Transportation Act, and the rules, regulations and requirements promulgated
under all of them, raw materials, building materials, the products of
manufacturing activities, wastes, petroleum, and source, special nuclear and
by-product material as those terms are defined in the Atomic Energy Act of 1954,
as amended.
"Indemnified Expenses" shall mean all liabilities, damages,
claims, taxes, deficiencies, assessments, losses, penalties, interest, costs and
expenses, including without limitation fees and disbursements of trial and
appellate counsel.
"License" shall mean the license issued by the FCC for the
operation of the specialized mobile radio ("SMR") communications station
operating in the 220-222 MHz band identified by the FCC call sign (the "FCC Call
Sign") set forth next to the name of each Person in which such license was
issued (the "Licensee(s)") as set forth on Schedule A.1. (the "System") in the
market (the "Market") also set forth next to the name of each such Licensee on
Schedule A.1. to the Disclosure Letter.
"Licensee(s)" shall have the meaning set forth in the
definition of the term License above and are identified on Schedule A.1. to the
Disclosure Letter.
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"Licensee Purchase Price" shall have the meaning set forth in
Section 4.26 of this Agreement.
"Lien" shall mean, with respect to any asset, any mortgage,
deed of trust, lien, pledge, negative pledge, hypothecation, security interest
or other charge, encumbrance or restriction of any kind, or any other type of
preferential arrangement (including any agreement to give any of the foregoing,
any conditional sale agreement, capital lease or other title retention
agreement, and the filing of or agreement to give any financing statement under
the Uniform Commercial Code of any jurisdiction) with respect to such asset, or
any imperfection of title, any right of first refusal, right of first option,
option to purchase or any adverse claim, with respect to such asset, and
exclusive of the Assumed Obligations.
"Market" shall have the meaning set forth in the definition of
the term License above.
"Option" shall mean the right of each Equipment Owner to
acquire the License applicable to the System relating to such License.
"Option Agreement" shall mean the option agreement by and
between each of the Licensees of each subject License and each of the Equipment
Owners pursuant to which each of the Equipment Owners has the Option to purchase
the subject License from the Licensee pursuant to the terms and conditions
thereof, as amended pursuant to the terms and conditions of a limited
authorization provided by each of the Licensees and Equipment Owners to SMR
Advisory.
"Parent" shall mean BizCom U.S.A., Inc., a Florida
corporation.
"Parent Common Stock" shall mean the common stock, par value
$.0001 per share, of Parent.
"Permissible Amount" shall mean, with respect to any Hazardous
Substance, such customary amounts thereof as may be commonly and lawfully
generated, stored, used, treated, disposed of otherwise handled or located on or
about the Real Property.
"Person" shall mean any individual, person, sole
proprietorship, company, corporation, partnership, joint venture, trust,
association, entity or Governmental Entity, or any group composed of any of the
foregoing.
"Purchased Assets" shall have the meaning set forth in Section
2.1 of this Agreement.
"Purchaser" shall mean BizCom Southern Holdings, Inc., a
Florida corporation.
"Real Property" shall have the meaning set forth in Section
4.6(a) of this Agreement.
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"Schedules" shall mean the disclosure schedules attached to
the Disclosure Letter which is a part hereof.
"SEC" shall mean the United States Securities and Exchange
Commission.
"Securities Act" shall mean the Securities Act of 1933, as
amended.
"SMR" shall mean specialized mobile radio.
"State Securities Laws" shall mean, collectively, the
securities, blue sky or other similar laws of any state of the United States of
America or of any other jurisdiction.
"System" shall have the meaning set forth in the definition of
the term License above.
"Transfer" shall mean any sale, assignment, transfer,
conveyance, exchange, gift, pledge, hypothecation, encumbrance or other
disposition of any security, including without limitation shares of Parent
Common Stock.
1.2 INTERPRETATION. In this Agreement, the singular includes the plural
and the plural includes the singular; words importing any gender include the
other gender; references to statutes or regulations are to be construed as
including all statutory or regulatory provisions consolidating, amending or
replacing the statute or regulation referred to; references to "writing" include
printing, typing, lithography, facsimile reproduction and other means of
reproducing words in a tangible visible form; the words "including," "includes"
and include" shall be deemed to be followed by the words "without limitation";
references to articles, sections exhibits, annexes or schedules are to those of
this Agreement unless otherwise indicated; references to agreements and other
contractual instruments shall be deemed to include all exhibits and appendices
attached thereto and all subsequent amendments, but only to the extent such
amendments and other modifications are not prohibited by the terms of this
Agreement; and references to Persons include their respective successors and
assigns and, in the case of Governmental Entities, Persons succeeding to their
respective functions and capacities.
ARTICLE II
SALE AND PURCHASE OF ASSETS
2.1 SALE AND PURCHASE.
Subject to the provisions of this Agreement, at the Closing,
each of the Equipment Owners shall sell, transfer, assign, convey and deliver to
Purchaser, and Purchaser shall purchase and accept delivery of, all of the
assets of each of the Equipment Owners set forth on Schedule 2.1 to the
Disclosure Letter which, as to each System, will generally consist of equipment
comprised of five SEA repeaters with one as master, five Trident Micro Systems
controllers with interconnect and real
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time use logging and documentation of use information, combining equipment,
co-axial cable, antenna, modem for interconnect and data transfer, and all
right, title and interest in and to the Option, the tower lease agreement and
insurance policies relating to the System (collectively, the "Purchased
Assets"), free and clear of any and all Liens. It is specifically understood and
agreed by each of the Equipment Owners and Purchaser that such Equipment Owner
is not selling to Purchaser, and Purchaser is not purchasing from Equipment
Owner, any assets or properties of Equipment Owner, other than the Purchased
Assets.
2.2 PURCHASE PRICE FOR PURCHASED ASSETS The aggregate purchase price to
be paid by Purchaser to the Equipment Owners for and in consideration of the
sale, transfer, assignment and conveyance to Purchaser of the Purchased Assets
shall be Twelve Million Nine Hundred and Twenty Thousand Dollars
($12,920,000)(the "Equipment Owner Purchase Price"). Such aggregate purchase
price shall be allocated among the Equipment Owners as previously determined by
the Equipment Owners and as instructed of the Purchaser by SMR Advisory for and
on behalf of the Equipment Owners. The Purchaser shall also assume the aggregate
amount of Assumed Obligations set forth in Section 2.4 (a) of this Agreement.
2.3 PAYMENT OF PURCHASE PRICE. Subject to the provisions of this
Agreement, at the Closing, Purchaser shall pay the Equipment Owner Purchase
Price to the Equipment Owners by the delivery to SMR Advisory for and on behalf
of the Equipment Owners of share certificates registered in the names of the
Equipment Owners representing an aggregate of 5,168,000 restricted shares of
Parent Common Stock in such denominations as SMR Advisory for and on behalf of
the Equipment Owners shall instruct.
2.4 ASSUMPTION OF OBLIGATIONS.
(a) Subject to the provisions of this Agreement, at the
Closing, Purchaser shall assume and agree to timely pay, perform, satisfy and
discharge all of the debts, liabilities, commitments, obligations, leases,
contracts and agreements of the Licensees and Equipment Owners aggregating
$1,680,000, set forth on Schedule 2.4 to the Disclosure Letter (collectively,
the "Assumed Obligations").
(b) Each of the Equipment Owners acknowledge and agree that
each of the Equipment Owners respectively shall retain, and Purchaser shall not
assume, or in any way be responsible for, or liable with respect to, any debts,
liabilities, commitments, obligations, leases, contracts or agreements of the
Equipment Owners, whether arising out of or in connection with the construction,
operation or maintenance of the System or the Purchased Assets, or otherwise,
and whether any of such debts, liabilities, commitments, obligations, leases,
contracts or agreements of the Equipment Owners shall be fixed, contingent or
otherwise, or known or unknown, other than the Assumed Obligations. From and
after the Closing Date, each of the Equipment Owners shall timely pay, perform,
satisfy and discharge all of their respective debts, liabilities, commitments,
obligations, leases, contracts and agreements, other than the Assumed
Obligations.
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ARTICLE III
CLOSING AND TERMINATION OF AGREEMENT
3.1 CLOSING. Subject to the provisions of Section 3.2 and Article X of
this Agreement, the closing of the transactions contemplated by this Agreement
(the "Closing") shall take place at the offices of Parent, 0000 XX 0xx Xxxxxx,
Xxxxx 000, Xxxx Xxxxxxxxxx, Xxxxxxx 00000 at 10 a.m., local time, ten (10) days
after the date on which the grant of FCC consent to the assignment of the
Licenses to Purchaser or Purchaser's designee becomes a Final Order, or such
other place, time or date as each of the Equipment Owners, Parent and Purchaser
shall mutually determine. The time and date of the Closing are hereinafter
referred to as the "Closing Date."
3.2 TERMINATION OF AGREEMENT.
(a) Notwithstanding the other provisions of this Agreement,
this Agreement may be terminated (i) at any time by the written consent of all
of the Equipment Owners, Parent and Purchaser and (ii) at any time after the
date which is one year from and after the date of this Agreement, by Purchaser,
at its sole option, if the Closing has not occurred by that date and if failure
to close is not as the result of a breach by Purchaser. If this Agreement is
terminated pursuant to this Section 3.2(a), (i) none of the parties hereto shall
have any liability or obligation to any other party pursuant to this Agreement;
and (ii) all FCC filings, applications and other submissions relating to the
assignment of each License shall (to the extent practicable) be withdrawn.
(b) Notwithstanding the other provisions of this Agreement, if
Parent or Purchaser breaches or fails to comply with any representation,
warranty, covenant or agreement set forth in this Agreement, and fails to cure
any such breach or failure to comply within thirty days after receiving written
notice thereof from an Equipment Owner, then such Equipment Owner may, at its
option, terminate this Agreement as to such Equipment Owner by delivery of
written notice to such effect to Parent and Purchaser.
(c) Notwithstanding the other provisions of this Agreement, if
an Equipment Owner breaches or fails to comply with any representation,
warranty, covenant or agreement set forth in this Agreement, and fails to cure
any such breach or failure to comply within thirty days after receiving written
notice thereof from Parent or Purchaser, then Parent or Purchaser may, at its
option, terminate this Agreement by delivery of written notice to such effect to
such Equipment Owner.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF EQUIPMENT OWNERS
In order to induce Parent and Purchaser to execute and deliver this
Agreement, and to consummate the transactions contemplated hereby, each of the
Equipment Owners represents and warrants to Parent and Purchaser as follows:
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4.1 PURCHASED ASSETS. Schedule 2.1 to the Disclosure Letter sets forth
a true, correct and complete list of all of the equipment owned by Equipment
Owner and utilized in connection with the operation of the System (including
without limitation the Purchased Assets). Equipment Owner leases such equipment
to its subject Licensee pursuant to the Equipment Lease Agreement.
4.2 TITLE TO PURCHASED ASSETS. Equipment Owner holds good, valid and
marketable title to all of the Purchased Assets, free and clear of any and all
Liens, other than (i) Liens for taxes not yet due and payable, and (ii) such
Liens, if any, as may be listed on Schedule 4.2 to the Disclosure Letter.
4.3 CONDITION OF PURCHASED ASSETS. Except as set forth on Schedule 2.1
to the Disclosure Letter, (a) all of the properties and assets, owned, leased or
utilized in connection with the operation of the System, whether real, personal
or mixed, including without limitation the Purchased Assets (excluding the
Option), are in good condition and repair, ordinary wear and tear excepted, are
in good operating order and are fit for the purposes for which they are used and
are intended to be used, are in conformity with the manufacturers'
specifications (including the ability to perform the functions for which it was
designed), and are in compliance with all applicable Governmental Rules
(including without limitation the Communications Act); (b) the Option is valid,
in full force and effect; and (c) to the best knowledge of the Equipment Owner,
the License is valid and in good standing with the FCC, there is no current
event or condition which could cause the revocation by the FCC of the License
relating to the System, and there are no liens, claims or encumbrances thereon.
4.4 BOOKS AND RECORDS. The books and records of Equipment Owner
(including without limitation the books and records of account), copies of which
have previously been provided by the Equipment Owner to the Purchaser for
review, are all true, correct and complete, and fairly reflect a true record of
the Equipment Owner of the business of operating the System and the Purchased
Assets.
4.5 REAL PROPERTY LEASES.
(a) Equipment Owner does not own any real property which is
utilized in connection with the operation of the System.
(b) Except as may be set forth on Schedule 2.4 to the
Disclosure Letter, true, correct and complete copies of each real property lease
to which Equipment Owner and/or the respective Licensee is a party as lessee and
which relates to the operation of a System, and any and all amendments,
modifications and extensions thereof, have previously been delivered to
Purchaser and are attached as a part of Schedule 2.4 to the Disclosure Letter.
(c) Equipment Owner is not in default under any real property
lease to which it is a party and which relates to the operation of the System,
and there has not occurred and there does not exist under any such lease, any
event of default or event which, with notice or the lapse of time
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or both, would constitute a default. Equipment Owner has not received any notice
of noncompliance with any applicable Governmental Rule (including without
limitation zoning regulations) relating to any real property lease to which it
is a party and which relates to the operation of the System. Equipment Owner is
not aware of any condemnation or other proceedings or any other matter which
could reasonably be expected to adversely effect the use of the property or
properties which are the subject of the leases described in Section 4.5 (b)
above.
4.6 ENVIRONMENTAL MATTERS.
(a) With respect to any real property leased by Equipment
Owner as described above or utilized in connection with the operation of the
System (collectively, the "Real Property"), neither Equipment Owner nor any
owner, lessor or user of the Real Property has generated, manufactured,
produced, stored, used, treated, released, discharged, disposed of or otherwise
handled on, under or about the Real Property, or transported to or from the Real
Property, any Hazardous Substance.
(b) No Hazardous Substance in excess of Permissible Amounts
has in the past or is at present located on the Real Property.
(c) None of the Real Property has been listed or proposed for
listing on the National Priorities List established by the EPA or on any other
list developed or maintained by any Governmental Entity and purporting to
identify properties posing the threat of pollution or contamination due to the
presence of any Hazardous Substance. Equipment Owner has not been identified by
the EPA or any Governmental Entity as a potentially responsible party for
environmental cleanup obligations with respect to the Real Property.
(d) All activities, operations and conditions at or on any
Real Property are in substantial compliance with all applicable Environmental
Laws.
4.7 NO ORDERS OR DECREES. Neither Equipment Owner nor any of the
Purchased Assets is subject to any judicial or administrative order, or any
Governmental Rule (including without limitation any ordinance or zoning
restriction) which could adversely affect, or impose any condition on, Equipment
Owner, the System, the License, the Purchased Assets, or the transactions
contemplated hereby.
4.8 DISPUTES AND LITIGATION. Except as may otherwise be set forth in
Schedule 4.8 to the Disclosure Letter, there is no claim, arbitration,
litigation, proceeding or governmental investigation in progress, pending or
threatened against or affecting Equipment Owner or the License, the Purchased
Assets, the System or the operations of the System. Except as may otherwise have
been disclosed to Parent and Purchaser in Schedule 4.8, no dispute is in
progress, pending or threatened, involving, with or against any supplier,
creditor, customer, landlord, licensor or other Person involving Equipment
Owner, the License, the Purchased Assets, the System or the operation of the
System. Except as may otherwise be set forth in Schedule 4.8 to the Disclosure
Letter,
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Equipment Owner has no knowledge of any fact or circumstance which might lead it
to believe that any dispute or litigation involving or affecting the License,
the Purchased Assets, the System or the operation of the System might arise.
None of Equipment Owner, the Purchased Assets, the System, or to the Equipment
Owner's knowledge, the License, is subject to any judgment, order, writ,
injunction or decree of any Governmental Entity.
4.9 TAXES. Except as set forth on Schedule 2.4 to the Disclosure
Letter, Equipment Owner has since its inception filed all federal, state, local,
foreign and other tax returns and reports of every nature required to be filed
in connection with the ownership, use or operation of the Purchased Assets and
the System, and has paid all taxes shown to be due on said returns or reports or
which have otherwise become due and payable. Copies of all such tax returns
since the Equipment's Owner's inception are attached as Schedule 4.9 to the
Disclosure Letter.
4.10 COMPLIANCE WITH LAW.
(a) Except as my otherwise be set forth in Schedule 4.10 to
the Disclosure Letter, the operation of the Purchased Assets and the System have
at all times been conducted in accordance with all applicable Governmental
Rules, and there is no Governmental Rule which would restrict Licensee or
Equipment Owner from carrying on the business and operations of the System in
the same manner as presently conducted. Equipment Owner has received any notice,
claim or complaint that it has not conducted or is not presently conducting its
business in accordance with all Governmental Rules.
(b) Equipment Owner has obtained all Governmental Approvals
under all applicable Governmental Rules in order to own and lease the Purchased
Assets, and all Governmental Approvals are in full force and effect.
(c) No proceedings have been instituted or threatened with a
view toward terminating or limiting any such Governmental Approvals and none of
such Governmental Approvals are subject to any outstanding order, decree,
judgment or stipulation, investigation or proceeding.
4.11 INSURANCE. To the extent insurable, the Purchased Assets are
insured under policies of fire, casualty, liability and other forms of insurance
in an amount not less than the actual replacement value of the insurable
Purchased Assets. True, correct and complete copies of all such insurance
policies are attached as Schedule 4.11 to the Disclosure Letter.
4.12 NO EMPLOYEES. Equipment Owner has never employed any person as an
employee in connection with the ownership or operation of the Purchased Assets.
4.13 COMPLIANCE WITH CERTAIN INSTRUMENTS. Except as may be set forth in
Schedule 4.13 to the Disclosure Letter, Equipment Owner is in full compliance
with all of the provisions of each and every one of the agreements, contracts,
leases, notes, mortgages, commitments and undertakings
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to which it is a party or by which it or any of its properties or assets is
bound and which relates to the operation of the System or the Purchased Assets.
Except as previously disclosed to Parent and Purchaser and as set forth as part
of Schedule 4.13 to the Disclosure Letter, Equipment Owner has not received any
notice, whether oral or written, to the effect that a default has occurred under
any of the provisions of any such agreements, contracts, leases, notes,
mortgages, commitments or undertakings, and Equipment Owner is not aware of any
fact which would lead it to believe that any such default (with or without the
giving of notice or the lapse of time or both) has occurred. Except as
previously disclosed to Parent and Purchaser, Equipment Owner has not waived any
right or remedy under any of such agreements, contracts, leases, notes,
mortgages, commitments or undertakings.
4.14 WAIVERS, CONSENTS AND APPROVALS; CONFLICT WITH OTHER INSTRUMENTS.
Except for any required waivers, consents or approvals set forth on Schedule
4.14 to the Disclosure Letter, the execution, delivery and performance by
Equipment Owner and the consummation of the transactions contemplated hereby:
(a) do not and will not violate (with or without the giving of
notice or the lapse of time or both), or require any consent or approval from,
any Person (including without limitation any Governmental Entity, any bank or
other financial institution, any creditor or any landlord); and
(b) do not and will not require any consent or approval under,
and do not and will not conflict with, or result in the breach, violation or
termination of any provision of, or constitute a default under, or result in the
acceleration of the performance of the obligations of Equipment Owner under, or
result in the creation of any Lien upon any or all of the Purchased Assets
pursuant to, any indenture, mortgage, deed of trust, lease, licensing agreement,
contract, instrument or other agreement, or any Governmental Rule, to which
Equipment Owner is a party or by which Equipment Owner, the System or any of the
Purchased Assets are bound.
4.15 AUTHORITY; GOOD STANDING. Equipment Owner has all requisite power
and authority to enter into this Agreement, and the agreements contemplated
hereby, and to perform its obligations hereunder and thereunder and to transfer
to Purchaser all of its right, title and interest in and to the Purchased Assets
(including without limitation the License). This Agreement and each and every
agreement, document and instrument contemplated hereby have been or will be duly
executed and delivered by Equipment Owner and constitutes or will constitute the
legal, valid and binding obligation of Equipment Owner and are or will be
enforceable against Equipment Owner in accordance with their respective terms
except as may be limited or otherwise effected by and subject to bankruptcy,
insolvency, reorganization, fraudulent conveyance or other similar statutes,
rules, regulations, or other laws affecting the enforceability of creditors'
rights and remedies generally, and laws relating to the availability of specific
performance, injunctive relief or other equitable remedies. Equipment Owner is
in good standing in the jurisdiction of its organization as evidenced by the
good standing certificate which comprises Schedule 4.15 of the Disclosure
Letter.
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4.16 SOPHISTICATED INVESTOR. Equipment Owner acknowledges that it has
such knowledge and experience in financial, business and investment matters,
including the telecommunications industry and the 220-22MHz segment of such
industry specifically , that it is capable of evaluating the terms and
conditions, merits and risks of the transactions described herein and the
investment contemplated hereby.
4.17 INFORMATION.
(a) Equipment Owner acknowledges its receipt and review of the
following documents with respect to Parent and Purchaser (collectively, the
"Disclosure Documents"):
Form 10-SB, as amended, and exhibits thereto, of Parent
(b) Equipment Owner has had the opportunity, through SMR
Advisory, to ask questions of, and to receive answers from, officers and
employees of Parent and Purchaser concerning Parent, Purchaser, their respective
businesses, affairs and operations, and the transactions contemplated by this
Agreement, and to obtain any additional information necessary to verify the
accuracy of the Disclosure Documents.
4.18 EVALUATION OF INFORMATION. Equipment Owner, by virtue of its
members' education, training and experience, has such knowledge and experience
in financial, investment and business matters generally, and in the
telecommunications industry and the 220-222 MHz SMR segment of such industry
specifically, that it is capable of understanding the information (including
without limitation the Disclosure Documents) provided to it by Parent and
Purchaser and of evaluating the merits and risks of its investment in the shares
of Parent Common Stock to be issued to it pursuant to this Agreement.
4.19 ACKNOWLEDGMENT OF RISKS. Equipment Owner understands and
acknowledges that there are significant risks to be considered in connection
with its investment in the shares of Parent Common Stock to be issued to it
pursuant to this Agreement, including without limitation the risks and factors
which might effect future operating results set forth in the Disclosure
Documents.
4.20 INVESTMENT AND RELATED MATTERS. The shares of Parent Common Stock
to be issued to Equipment Owner pursuant to this Agreement are being acquired by
Equipment Owner for its own account, and not for the account or beneficial
interest of any other Person. The shares of Parent Common Stock to be issued to
Equipment Owner pursuant to this Agreement are not being acquired by Equipment
Owner with a view to, or for resale in connection with, any "distribution"
within the meaning of the Securities Act or any applicable State Securities
Laws.
Each of the Equipment Owners further represents and warrants to the
Parent that:
(a) its plan or agreement to transfer the Purchased Assets does not
provide for:
(1) the dissolution of the Equipment Owner; or
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(2) a pro rata or similar distribution of securities of the
Parent to the members of the Equipment Owner who voted or consented to transfer
such Purchased Assets; and
(b) the representatives and/or members of the Equipment Owner will not
adopt resolutions relative to (a)(1) or (2) within one year after the taking of
such vote of consent to transfer such assets;
(c) the transfer of the Purchase Assets is not part of a pre-existing
plan for distribution of Parent Common Stock, notwithstanding (a) or (b) above;
and
(d) the Equipment Owner will comply in all respects with applicable
Texas limited liability laws, rules, and regulations and applicable federal and
state securities laws in connection with its receipt of Parent Common Stock and
any later proposed subsequent dispositions thereof, if any, and provide evidence
thereof satisfactory to Parent prior thereto; and
(e) the shares of Parent Common Stock to be issued to Equipment Owner
pursuant to this Agreement shall be subject to the lock-up provisions set forth
in the limited authorization provided by each of the Equipment Owners to SMR
Advisory.
4.21 RESIDENCE. The address of Equipment Owner is correctly set forth
on Schedule A to the Disclosure Letter. Equipment Owner is a resident of the
State indicated on Schedule A to the Disclosure Letter.
4.22 RESTRICTED SECURITIES.
(a) The shares of Parent Common Stock to be issued to
Equipment Owner pursuant to this Agreement have not been, and will not be,
registered under the Securities Act or any State Securities Laws and, as such,
must be held by Equipment Owner unless and until they are subsequently so
registered under the Securities Act and any applicable State Securities Laws or
an exemption from registration thereunder is available. The shares of Parent
Common Stock to be issued to Equipment Owner hereunder constitute "restricted
securities," as that term is defined in Rule 144 promulgated by the SEC under
the Act.
(b) Equipment Owner shall not Transfer any or all of the
shares of Parent Common Stock to be issued to it pursuant to this Agreement,
unless such Transfer is registered under the Securities Act and any applicable
State Securities Laws or a specific exemption from registration thereunder is
available. Any Transfer of any or all of the shares of Parent Common Stock to be
issued to Equipment Owner pursuant to this Agreement which is made pursuant to
an exemption claimed under the Securities Act and any applicable State
Securities Laws will require a favorable opinion of Equipment Owner's legal
counsel, in form and in substance satisfactory to Parent and its legal counsel,
to the effect that such Transfer does not and will not violate the provisions of
the Securities Act or any applicable State Securities Laws or the terms of this
Agreement.
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(c) Neither Parent nor Purchaser is under any obligation
whatsoever to file any registration statement under the Securities Act or any
State Securities Laws, to register any Transfer of any shares of Parent Common
Stock to be issued pursuant to this Agreement, or to take any other action
necessary for the purpose of making an exemption from registration available to
Equipment Owner in connection with any such Transfer. Stop transfer instructions
will be issued by Parent with respect to the shares of Parent Common Stock to be
issued to Equipment Owner pursuant to this Agreement.
4.23 RESTRICTIVE LEGEND. There will be placed upon all of the
certificates representing shares of Parent Common Stock delivered to Equipment
Owner, and any and all certificates delivered in partial or total substitution
therefor, a restrictive legend which will read substantially as follows:
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED ("SECURITIES
ACT") AND MAY NOT BE SOLD, ASSIGNED, TRANSFERRED, CONVEYED, PLEDGED,
HYPOTHECATED, ENCUMBERED OR OTHERWISE DISPOSED OF UNLESS (A) THEY ARE
COVERED BY A REGISTRATION STATEMENT OR POST-EFFECTIVE AMENDMENT
THERETO, EFFECTIVE UNDER THE SECURITIES ACT, OR (B) SUCH SALE,
ASSIGNMENT, TRANSFER, CONVEYANCE, PLEDGE, HYPOTHECATION, ENCUMBRANCE OR
OTHER DISPOSITION IS EXEMPT FROM THE PROVISIONS OF SECTION 5 OF THE
SECURITIES ACT.
THE SHARES REPRESENTED BY THIS CERTIFICATE ARE ALSO SUBJECT TO
CERTAIN LOCK-UP RESTRICTIONS WITH THE COMPANY.
4.24 NO BROKERAGE. No broker, finder or Person acting in a similar
capacity has been employed or retained by Equipment Owner, or by any of its
respective Affiliates, in connection with the transactions contemplated by this
Agreement, and no Person is entitled to receive any brokerage, finders' or
similar fee or commission in connection with this Agreement and the transactions
contemplated hereby.
4.25 THE SCHEDULES. All of the facts recited in all of the Schedules to
the Disclosure Letter are true, correct and complete and shall be deemed to be
representations and warranties of fact as though set forth in this Article IV.
4.26 UNDERTAKINGS CONCERNING LICENSEES. At or prior to the Closing,
each of the Equipment Owners shall cause their respective Licensees to sell,
transfer, assign and convey to Purchaser all of their respective right, title
and interest in and to any tower site leases and insurance policies relating to
the subject System operated by the Licensees prior to Closing (and shall cause
to be provided to the Purchaser written evidence thereof satisfactory to the
Purchaser, including copies of same to be included as part of Schedule 2.4 to
the Disclosure Letter and arrearages, if any,
14
concerning same), and each of the Equipment Owners shall issue to their
respective Licensees (and shall provide to the Purchaser written evidence
thereof satisfactory to Purchaser) for and in consideration of the sale,
transfer, assignment and conveyance by the Licensee to Purchaser of the License
following the Purchaser's exercise of the Option, the cancellation of their
respective Equipment Lease Agreements with the Equipment Owners, and the
transfer, assignment and conveyance by their respective Licensees to the
Purchaser of all of their right, title and interest in and to any tower site
lease agreements and insurance policies relating to the subject System, the
number of units in the Equipment Owner to which each of the Licensees is
entitled pursuant to each of their respective prior agreement and understanding
with the subject Equipment Owner (the "Licensee Purchase Price").
4.27 FULL DISCLOSURE. No representation or warranty made by Equipment
Owner in this Agreement, and no certification to be furnished by Equipment Owner
to Parent or Purchaser pursuant to this Agreement, contains or will contain any
untrue statement of a material fact, or omits or will omit to state any material
fact necessary to make the statements contained herein or therein not
misleading.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF PURCHASER
In order to induce each of the Equipment Owners to enter into this
Agreement, and to consummate the transactions contemplated hereby, Purchaser
represents and warrants to each of the Equipment Owners, as follows:
5.1 CORPORATE ORGANIZATION AND GOOD STANDING. Purchaser is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Florida as evidenced by the recently dated good standing
certificate issued by the Florida Secretary of State and provided by the
Purchaser to the Equipment Owners at the closing. Purchaser is qualified to
transact business as a foreign corporation in every jurisdiction where the
character of its activities requires such qualification. Purchaser has all
requisite corporate power, franchises, licenses and authority to own, lease and
operate its respective assets and properties and to carry on its business as
presently conducted.
5.2 AUTHORITY. Purchaser has all requisite corporate power and
authority to enter into this Agreement, and the agreements contemplated hereby,
and to perform its obligations hereunder and thereunder. The execution, delivery
and performance of this Agreement and the agreements, documents and instruments
contemplated hereby by Purchaser have all been duly authorized by all necessary
corporate action of Purchaser. This Agreement and the agreements, documents and
instruments contemplated hereby have been or will be duly executed and delivered
by Purchaser and constitute or will constitute the legal, valid and binding
obligation of Purchaser and are or will be enforceable against Purchaser in
accordance with their respective terms except as may be limited or otherwise
effected by and subject to bankruptcy, insolvency, reorganization, fraudulent
conveyance
15
or other similar statutes, rules, regulations, or other laws affecting the
enforceability of creditors' rights and remedies generally, and laws relating to
the availability of specific performance, injunctive relief or other equitable
remedies.
5.3 CONSENTS AND CONFLICTS. Except as set forth on Schedule 4.14
attached hereto, the execution, delivery and performance of this Agreement by
Purchaser and the consummation of the transactions contemplated hereby:
(a) do not and will not violate (with or without the giving of
notice or the lapse of time or both), or require any consent or approval from,
any Person (including without limitation any Governmental Entity, any bank or
other financial institution, any creditor or any landlord); and
(b) do not and will not require any consent or approval under,
and do not and will not conflict with, or result in the breach, violation or
termination of any provision of or constitute a default under, or result in the
acceleration of the performance of the obligations of Purchaser under, or result
in the creation of any Lien upon any of the assets and properties of Purchaser
pursuant to, any indenture, mortgage, deed of trust, lease, licensing agreement,
contract, instrument or other agreement, or any Governmental Rule, to which
Purchaser is a party or by which Purchaser or any of its assets or properties
are bound.
5.4 NO BROKERAGE. No broker, finder or Person acting in a similar
capacity has been employed or retained by Purchaser, or by any of its
Affiliates, in connection with the transactions contemplated by this Agreement,
and no Person is entitled to receive any brokerage, finders' or similar fee or
commission in connection with this Agreement and the transactions contemplated
hereby.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES OF PARENT
In order to induce each of the Equipment Owners to enter into this
Agreement, and to consummate the transactions contemplated hereby, Parent
represents and warrants to each of the Equipment Owners, as follows:
6.1 CORPORATE ORGANIZATION AND GOOD STANDING. Parent is a corporation
duly organized, validly existing and in good standing under the laws of the
State of Florida as evidenced by the recently dated good standing certificate
issued by the Florida Secretary of State and provided by the Parent to the
Equipment Owners at the closing. Parent is qualified to transact business as a
foreign corporation in every jurisdiction where the character of its activities
requires such qualification. Parent has all requisite corporate power,
franchises, licenses and authority to own, lease and operate its respective
assets and properties and to carry on its business as presently conducted.
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6.2 AUTHORITY. Parent has all requisite corporate power and authority
to enter into this Agreement, and the agreements contemplated hereby, and to
perform its obligations hereunder and thereunder. The execution, delivery and
performance of this Agreement and the agreements, documents and instruments
contemplated hereby by Parent have all been duly authorized by all necessary
corporate action of Parent. This Agreement and the agreements, documents and
instruments contemplated hereby have been or will be duly executed and delivered
by Parent and constitute or will constitute the legal, valid and binding
obligation of Parent and are or will be enforceable against Parent in accordance
with their respective terms except as may be limited or otherwise effected by
and subject to bankruptcy, insolvency, reorganization, fraudulent conveyance or
other similar statutes, rules, regulations, or other laws affecting the
enforceability of creditors' rights and remedies generally, and laws relating to
the availability of specific performance, injunctive relief or other equitable
remedies.
6.3 CONSENTS AND CONFLICTS. Except as set forth on Schedule 4.14
attached hereto, the execution, delivery and performance of this Agreement by
Parent and the consummation of the transactions contemplated hereby:
(a) do not and will not violate (with or without the giving of
notice or the lapse of time or both), or require any consent or approval from,
any Person (including without limitation any Governmental Entity, any bank or
other financial institution, any creditor or any landlord); and
(b) do not and will not require any consent or approval under,
and do not and will not conflict with, or result in the breach, violation or
termination of any provision of or constitute a default under, or result in the
acceleration of the performance of the obligations of Parent under, or result in
the creation of any Lien upon any of the assets and properties of Parent
pursuant to, any indenture, mortgage, deed of trust, lease, licensing agreement,
contract, instrument or other agreement, or any Governmental Rule, to which
Parent is a party or by which Parent or any of its assets or properties are
bound.
6.4 PARENT COMMON STOCK. Upon their issuance by Parent and delivery to
Equipment Owner, the shares of Parent Common Stock to be issued pursuant to this
Agreement will be duly and validly issued, fully paid and nonassessable.
6.5 NO BROKERAGE. No broker, finder or Person acting in a similar
capacity has been employed or retained by Parent, or by any of its Affiliates,
in connection with the transactions contemplated by this Agreement, and no
Person is entitled to receive any brokerage, finders' or similar fee or
commission in connection with this Agreement and the transactions contemplated
hereby.
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ARTICLE VII
COVENANTS AND AGREEMENTS OF EQUIPMENT OWNERS
PENDING CLOSING
7.1 ORDINARY COURSE. From and after the date of this Agreement and
through the Closing Date, each of the Equipment Owners shall cause the Purchased
Assets and the subject System, to the extent of its ability as the holder of the
Option, be operated only in the ordinary and usual course of business. Without
limiting the generality of the immediately preceding sentence, but subject to
the extent of its ability as the holder of the Option, from and after the date
of this Agreement and through the Closing Date, each of the Equipment Owners
shall not, directly or indirectly, without the prior written approval of
Purchaser, and as to the License pertaining to the System to which it relates:
(a) incur any debt, liability or obligation, make any
commitment or disbursement, acquire or dispose of any property or asset, make or
modify any lease, contract or agreement, or engage in any transaction, with
regard to the License, the Purchased Assets or the System, other than in the
ordinary and usual course of its business;
(b) issue any purchase order for goods, assets or services,
other than in the ordinary and usual course of its business, or make any capital
expenditure, other than those required to maintain the Purchased Assets in a
state of ordinary and usual repair;
(c) subject the License or any of the Purchased Assets to any
Lien;
(d) employ as an employee any Person in connection with the
operation of the System;
(e) sell, lease, assign, convey or transfer the License or any
or all of the Purchased Assets, or agree to sell, lease, assign, convey or
transfer the License or any or all of the Purchased Assets;
(f) cancel, amend or modify any policy of insurance or permit
any such policy to lapse or terminate;
(g) commit any unlawful act or breach or violate any
Governmental Rule;
(h) take any action which would have an adverse effect on the
System, the License or any of the Purchased Assets, including without limitation
the value or condition thereof;
(i) do anything, or fail to do anything, which would cause a
breach or default in any contract, agreement, commitment or obligation to which
each of the Licensees or Equipment Owners is a party or by which each Licensee,
Equipment Owner, the System, the License or any of the Purchased Assets may be
bound; or
(j) engage in any activity or enter into any transaction which
would be inconsistent with any of the representations and warranties of each of
the Equipment Owners set forth in this Agreement if such representations and
warranties were made as of a date subsequent to
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such activity or transaction and all references to the date of this Agreement
were deemed to be such latter date.
7.2 FURNISHING OF INFORMATION. Each of the Equipment Owners shall (a)
provide to Parent, Purchaser and their representatives, during normal business
hours or otherwise if so requested, full access to all of the properties,
assets, personnel, books, agreements, commitments, files and records of the
respective Equipment Owner with respect to the License, the Purchased Assets and
the System, in whatever form; (b) furnish to Parent, Purchaser and their
representatives all data and information concerning the business, operations,
assets, properties, liabilities, revenues, expenses and affairs of the System
and the Purchased Assets as Parent, Purchaser and their representatives may
reasonably request; (c) use its best efforts to cause the past and present
auditors, if any, and accounting personnel of the respective Equipment Owner to
make available to Parent, Purchaser and their representatives all financial
information relating to the System and the Purchased Assets as is reasonably
requested, including the right to examine all working papers pertaining to
audits and reviews previously or hereafter made by such auditors, if any; (d)
provide such cooperation as Parent, Purchaser and their representatives may
reasonably request in connection with any audit or review of the System, the
License or the Purchased Assets which Parent or Purchaser may direct its
representatives to make; (e) furnish to Parent, Purchaser and their
representatives true, correct and complete copies of all financial and operating
statements of the System and the Purchased Assets, and all documents, agreements
and instruments described herein or listed in the Schedules; and (f) permit
Parent, Purchaser and their representatives (including its subcontractors) to
conduct during normal business hours environmental audits of the Real Property,
which audits may include, without limitation placement of xxxxx to conduct soil
and ground water analysis, site inspections and inspection of all permits and/or
licenses relating to Environmental Laws.
7.3 BUSINESS ORGANIZATION INTACT. Each of the Equipment Owners shall
use their best efforts to preserve and keep intact the business organization of
the respective Equipment Owner.
7.4 EXCLUSIVE DEALING. From and after the date of this Agreement and
through the Closing Date, each of the Equipment Owners shall not, directly or
indirectly, encourage, initiate or engage in any discussions or negotiations
with, or provide any information to, any Person, other than Parent, Purchaser
and their representatives, concerning (a) the sale of all or substantially all
of the System or the License or any of the Purchased Assets or (b) any other
transaction not in the ordinary and usual course of business of operating the
System and the Purchased Assets.
7.5 ASSIGNMENT APPLICATION AND RELATED MATTERS. Promptly following the
execution and delivery of this Agreement, each of the Equipment Owners shall use
their best efforts to cause their respective Licensees: (a) to cooperate with
Parent and Purchaser in the preparation of their respective portions of the
Assignment Application; (b) not to sell, transfer or otherwise encumber their
respective Licenses except pursuant to the exercise of the Option by the
Purchaser; (c) to continue to operate the Systems to which their respective
Licenses relate in the ordinary and normal course as each such System has been
operated prior to the date of execution of this Agreement; and (d) to cooperate
with Parent and Purchaser in the assignment to Purchaser of any tower leases and
19
insurance policies relating to the System applicable to each such Licensee.
7.6 REASONABLE EFFORTS. Upon the terms and subject to the conditions
set forth in this Agreement, each of the Equipment Owners shall use all
reasonable efforts to take, or to cause to be taken, all actions, and to do, or
to cause to be done, all things necessary, proper, convenient or advisable in
order to consummate the transactions contemplated by this Agreement.
ARTICLE VIII
COVENANTS AND AGREEMENTS OF PARENT AND PURCHASER
PENDING CLOSING
8.1 CONFIDENTIALITY. Unless and until the transactions contemplated by
this Agreement are fully consummated, Parent and Purchaser shall hold all data
and information obtained with respect to the System, the License and the
Purchased Assets in such degree of confidence as each of the Equipment Owners
maintain such information, and shall not use such data or information or to
disclose it to others, except (a) as permitted by each of the Equipment Owners,
(b) to the extent such data or information is published or is a matter of public
knowledge, (c) as may be required by law or judicial or administrative process
or (d) as may be required to secure any Governmental Approval.
8.2 ASSIGNMENT APPLICATION. Within a reasonable time following the
execution and delivery of this Agreement and receipt from each of the Licensees
and Equipment Owners of all required information, Parent and Purchaser shall
prepare and file with the FCC the Assignment Application.
8.3 REASONABLE EFFORTS. Upon the terms and subject to the conditions
set forth in this Agreement, Parent and Purchaser shall use all reasonable
efforts to take, or to cause to be taken, all actions, and to do, or to cause to
be done, all things necessary, proper, convenient or advisable in order to
consummate the transactions contemplated by this Agreement.
ARTICLE IX
SURVIVAL; INDEMNITIES
9.1 SURVIVAL OF REPRESENTATIONS, WARRANTIES, COVENANTS AND AGREEMENTS.
(a) All of the representations, warranties, covenants,
agreements and certifications of each of the Equipment Owners set forth in this
Agreement or otherwise shall survive the Closing and the consummation of the
transactions contemplated by this Agreement, notwithstanding any audit or
investigation made by or on behalf of Parent or Purchaser.
(b) All of the representations, warranties, covenants,
agreements and indemnities
20
of Parent and Purchaser set forth in this Agreement shall survive the Closing
and the consummation of the transactions contemplated by this Agreement,
notwithstanding any audit or investigation made by or on behalf of an Equipment
Owner.
9.2 INDEMNIFICATION OF EQUIPMENT OWNERS.
(a) Purchaser shall indemnify and hold harmless each of the
Equipment Owners from, against and in respect of the full amount of any and all
Indemnified Expenses arising from, in connection with, or incident to any breach
or violation of any or all of the representations, warranties, covenants,
agreements, terms and conditions made by Purchaser in this Agreement or any
certificate, instrument or other document delivered by Purchaser to the
Equipment Owners pursuant to this Agreement.
(b) Parent shall indemnify and hold harmless each of the
Equipment Owners from, against and in respect of the full amount of any and all
Indemnified Expenses arising from, in connection with, or incident to any breach
or violation of any or all of the representations, warranties, covenants,
agreements, terms and conditions made by Parent in this Agreement or any
certificate, instrument or other document delivered by Parent to the Equipment
Owners pursuant to this Agreement.
9.3 INDEMNIFICATION OF PARENT AND PURCHASER. Each of the Equipment
Owners shall indemnify and hold harmless Parent and Purchaser from, against and
in respect of the full amount of any and all Indemnified Expenses arising from,
in connection with, or incident to any breach or violation of any or all of the
representations, warranties, covenants, agreements, terms and conditions made by
such Equipment Owner in this Agreement or to which such Equipment Owner is
subject or any certificate, instrument or other document delivered by such
Equipment Owner to Parent or Purchaser pursuant or in connection with this
Agreement or the sale and any disposition of the units in the Equipment Owner to
be issued by the Equipment Owner to the Licensee as discussed in Section 4.26
herein. Each of the Equipment Owners shall indemnify and hold harmless Parent
and Purchaser from, against and in respect of the full amount of any and all
Indemnified Expenses relating to any matter, cause or thing relating in any
manner to the respective License, the Purchased Assets or the System, or the
ownership, lease or operation of any of them, arising prior to the Closing Date
and asserted by any Person not a party to this Agreement.
9.4 THIRD PARTY CLAIMS PROCEDURE.
(a) If any Person not a party to this Agreement shall make any
demand or claim, or shall file or threaten to file any suit, action or
proceeding, for which Parent or Purchaser may be entitled to indemnification
pursuant to the provisions of Section 9.3 of this Agreement, then, in any such
event, Parent or Purchaser shall give prompt written notice of the existence of
any such demand, claim, suit, action or proceeding to the particular Equipment
Owner(s). In any event, written notice shall be given not later than the
fifteenth day after a party shall first gain knowledge of the existence of any
such demand, claim, suit, action or proceeding.
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(b) Each of such Equipment Owners shall promptly retain legal
counsel reasonably acceptable to Parent or Purchaser to defend any such demand,
claim, suit, action or proceeding. If such Equipment Owner shall fail for any
reason to retain promptly such legal counsel, then, in any such event, Parent or
Purchaser shall retain (or cause such Equipment Owner(s) to retain) legal
counsel at the expense of such Equipment Owner(s) to conduct such defense. If
such Equipment Owner(s) shall retain such legal counsel, Parent or Purchaser
may, at its option and at its expense, retain separate legal counsel to
represent its interest. Such Equipment Owner(s), Parent and Purchaser and their
respective legal counsel shall consult and shall cooperate with one another
regarding the defense, settlement and compromise of any such demand, claim,
suit, action or proceeding.
(c) If such Equipment Owner(s) shall have retained legal
counsel, then all decisions with respect to the defense, settlement or
compromise of such demand, claim, action, suit or proceeding shall be within the
discretion of such Equipment Owner(s); provided, however, that such Equipment
Owner(s) shall not defend, settle or compromise any such demand, claim, suit,
action or proceeding without the prior written consent of Parent or Purchaser,
which consent shall not be unreasonably withheld or delayed. If such Equipment
Owner(s) shall not have retained legal counsel, all decisions with respect to
the defense, settlement or compromise of such demand, claim, suit, action or
proceeding shall be solely within the discretion of Parent or Purchaser.
ARTICLE X
CONDITIONS PRECEDENT TO CLOSING
10.1 CONDITIONS PRECEDENT TO OBLIGATIONS OF EQUIPMENT OWNERS. The
obligations of each of the Equipment Owners to consummate the transactions
contemplated hereby shall be subject to the satisfaction at or prior to the
Closing Date of all of the following conditions precedent (any or all of which
may be waived, in whole or in part, by the particular Equipment Owner in its
discretion):
(a) No preliminary or permanent injunction or other order
issued by a court of competent jurisdiction or by any other Governmental Entity,
nor any Governmental Rule enacted or promulgated subsequent to the date of this
Agreement, which prohibits the consummation of the transactions contemplated
hereby shall be in effect.
(b) Parent and Purchaser shall have performed in all material
respects their respective obligations under this Agreement required to be
performed by them on or prior to the Closing Date.
(c) The representations and warranties of each of Parent and
Purchaser contained in this Agreement shall be true and correct in all respects
at and as of the Closing Date as if made at and as of such time, except as
affected by transactions contemplated hereby and except to the extent that any
such representation or warranty is made as of a specified date (in which case
such
22
representation and warranty shall have been true and correct as of such date.)
(d) The Equipment Owner shall have received a certificate,
dated the Closing Date, of an officer of Parent and Purchaser to the effect that
the conditions precedent specified in paragraphs (b) and (c) of this Section
10.1 have been satisfied.
10.2 CONDITIONS PRECEDENT TO THE OBLIGATIONS OF PARENT AND PURCHASER.
The obligations of Parent and Purchaser to consummate the transactions
contemplated hereby shall be subject to the satisfaction at or prior to the
Closing Date of all of the following conditions precedent (any or all of which
may be waived, in whole or in part, by Parent and Purchaser in their
discretion):
(a) No preliminary or permanent injunction or other order
issued by a court of competent jurisdiction or by any other Governmental Entity,
nor any Governmental Rule enacted or promulgated subsequent to the date of this
Agreement, which prohibits the consummation of the transactions contemplated
hereby shall be in effect.
(b) Each of the Equipment Owners shall have performed in all
material respects their respective obligations pursuant to this Agreement
required to be performed by them on or prior to the Closing Date.
(c) The representations and warranties of each of the
Equipment Owners contained in this Agreement shall be true and correct in all
respects at and as of the Closing Date as if made at and as of such time, except
as affected by transactions contemplated hereby and except to the extent that
any such representation or warranty is made as of a specified date (in which
case such representation and warranty shall have been true and correct as of
such date.)
(d) Parent and Purchaser shall have received a certificate,
dated the Closing Date, from each of the Equipment Owners to the effect that the
conditions precedent specified in paragraphs (b) and (c) of this Section 10.2
applicable to each of the Equipment Owners, respectively, have been satisfied.
(e) All audits and investigations of each Licensee, Equipment
Owner, the System, the License and the Purchased Assets undertaken by Purchaser
shall have been completed to the satisfaction of Purchaser.
(f) There shall not have occurred any material adverse change
in any of the Licenses, the Purchased Assets or the System.
(g) All Liens and indebtedness with respect to the Licenses,
the Purchased Assets and the System shall have been released.
(h) There shall have been received all of the waivers,
consents and approvals set forth on Schedule 4.14 attached hereto, without the
addition of any condition or requirement which
23
could have a material adverse effect on any of the Licenses, the Purchased
Assets or the System, would increase the cost of operation thereof or increase
the Purchase Price.
(i) The FCC shall have granted its consent to the assignment
of the Licenses to Purchaser, without the addition of any condition or
requirement which could have a material adverse effect on the Licenses, increase
the cost of operation of the Purchased Assets or the System or increase the
Purchase Price, and such grant shall have become a Final Order.
(j) The following shall have been delivered to Purchaser:
(i) one or more bills of sale conveying to Purchaser
the Licenses, and all of the Purchased Assets, free and clear of any and all
Liens;
(ii) evidence of the assignment of all leases and
other agreements identified on Schedule 2.4 to the Disclosure Letter;
(iii) copies of all equipment manuals and material
maintenance records associated with the Purchased Assets; and
(iv) such other documents, assignments, bills of
sale, instruments of conveyance, and certificates of officers as may be
reasonably required by Parent and Purchaser to consummate this Agreement and the
transaction contemplated herein.
ARTICLE XI
MISCELLANEOUS PROVISIONS
11.1 EXPENSES. All of the legal, accounting and other costs and
expenses incurred in connection with this Agreement and the transactions
contemplated hereby shall be borne and paid by the party to this Agreement
incurring such costs and expenses, and no party shall be obligated for any cost
or expense incurred by the other party to this Agreement.
11.2 GOVERNING LAW. This Agreement shall be governed by, and shall be
construed and interpreted in accordance, with the laws of the State of Florida,
without giving effect to the principles of conflicts of law thereof.
11.3 JURISDICTION AND VENUE; SERVICE OF PROCESS; WAIVER OF TRIAL BY
JURY. If any dispute or controversy shall arise between any of the Equipment
Owners on the one hand and Parent or Purchaser on the other pursuant to this
Agreement, such dispute or controversy may only be brought for resolution solely
in the federal and/state courts locate in Broward County, Florida. Each of the
Equipment Owners, Parent and Purchaser hereby consent to the jurisdiction and
venue of such courts, and agree that they shall not contest or challenge the
jurisdiction or venue of such courts. Each of the Equipment Owners, Parent and
Purchaser agrees that service of any process, summons,
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notice or document, by United States registered or certified mail, to its
address set forth in or as provided in Section 11.4 below shall be effective
service of process for any action, suit or proceeding brought against it in any
such court. In recognition of the fact that the issues which would arise under
this Agreement are of such a complex nature that they could not be properly
tried before a jury, each of the Equipment Owners, Parent and Purchaser waives
trial by jury.
11.4 NOTICES. Any and all notices and other communications given
pursuant to this Agreement shall be in writing and shall be deemed to have been
duly given when delivered by hand, or when delivered by mail, by registered or
certified mail, postage prepaid, return receipt requested, to the respective
parties at the following respective addresses:
If to Equipment Owner: To the address set forth on
Schedule A of the Disclosure Letter
If to Parent or Purchaser: BizCom U.S.A., Inc.
0000 XX 00xx Xxxxxx, Xxxxx 000
Xxxx Xxxxxxxxxx, Xxxxxxx 00000
Attention: Xxxxx Xxxxx,
Chairman and Chief Executive Officer
or to such other address as any party may from time to time give written notice
of to the others in accordance with the provisions of this Section 11.4.
11.5 ENTIRE AGREEMENT. This Agreement, together with the Disclosure
Letter and Schedules attached thereto, constitutes the entire agreement among
the parties with respect to the subject matter hereof and supersedes all prior
agreements, understandings, negotiations and arrangements, both oral and
written, among the parties with respect to such subject matter. This Agreement
may not be amended or modified in any manner, except by a written instrument
executed by all of the parties hereto.
11.6 BENEFITS; BINDING EFFECT. This Agreement shall be for the benefit
of, and shall be binding upon, the parties hereto and their respective heirs,
personal representatives, executors, legal representatives, successors and
assigns.
11.7 NO ASSIGNMENT. None of the Equipment Owners shall (i) assign any
of their rights or delegate any of their obligations under this Agreement, (ii)
transfer or assign the particular License to any Person or (iii) transfer or
assign the Purchased Assets to any other Person. Purchaser may assign its rights
and delegate its obligations pursuant to this Agreement to an Affiliate of
Purchaser, including but not limited to Parent, without the consent of any of
the Equipment Owners. Upon the execution of any permissible assignment and
assumption of the obligations of Purchaser hereunder, Purchaser shall have no
further obligations hereunder.
11.8 WAIVER OF BULK TRANSFER LAWS. Parent and Purchaser waive
compliance by the
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and Equipment Owners with the laws of any jurisdiction relating to bulk
transfers which may be applicable to the transfer of the License and the
Purchased Assets to Purchaser; provided, however, that each of the Equipment
Owners shall jointly and severally indemnify and hold harmless Parent and
Purchaser from, against and in respect of the full amount of any and all
Indemnified Expenses relating to any matter, cause or thing resulting or arising
from noncompliance by the particular Equipment Owner with such bulk transfer
laws.
11.9 RISK OF LOSS. Each of the Equipment Owners acknowledge and agree
that the risk of loss, damage or destruction of the Purchased Assets shall be
borne solely by the particular Equipment Owner through the Closing Date. In the
event of any loss, damage or destruction of the Purchased Assets prior to
Closing, the particular Equipment Owner shall promptly restore, replace or
repair the lost, damaged or destroyed property to its previous condition at
their own cost, and such Equipment Owner shall have the right to use all
insurance proceeds to effect such restoration, replacement or repair and to
retain all excess insurance proceeds.
11.10 NO THIRD PARTY BENEFICIARIES. Nothing herein, expressed or
implied, is intended to or shall confer on any person or entity, other than the
parties hereto, any rights, remedies, obligations or liabilities under or by
reason of this Agreement.
11.11 SEVERABILITY. The invalidity of any one or more of the words,
phrases, sentences, clauses or sections contained in this Agreement shall not
affect the enforceability of the remaining portions of this Agreement or any
part hereof, all of which are inserted conditionally on them being valid in law.
If any one or more of the words, phrases, sentences, clauses or sections
contained in this Agreement shall be declared invalid by any court of competent
jurisdiction, then, in any such event, this Agreement shall be construed as if
such invalid word or words, phrase or phrases, sentence or sentences, clause or
clauses, or section or sections had not been inserted.
11.12 FURTHER ASSURANCES. Each of the parties agrees to undertake and
effect all such actions and deliver all such instruments and other documents
necessary to effectuate the purposes and intent of this Agreement, including but
not limited to the assignment to the Purchaser of tower site lease agreements
relating to the Systems and insurance policies relating to the Purchased Assets
and operation of the Systems.
11.13 NO WAIVERS. The waiver by any party of a breach or violation of
any provision of this Agreement by any other party shall not operate nor be
construed as a waiver of any subsequent breach or violation, nor as a waiver by
any other party of such breach or violation nor as a waiver by any other party
of any subsequent breach or violation. The waiver by any party to exercise any
right or remedy it may possess shall not operate nor be construed as a bar to
the exercise of such right or remedy by such party upon the occurrence of any
subsequent breach or violation, nor as a bar to the exercise of any right or
remedy by any other party.
11.14 HEADINGS. The headings contained in this Agreement are for
reference purposes only and shall not affect in any way the meaning or
interpretation of any or all of the provisions hereof.
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11.15 RULE OF CONSTRUCTION THAT AMBIGUITIES TO BE CONSTRUED AGAINST
DRAFTER NOT APPLICABLE. As all parties to this Agreement have been represented
by their respective counsel in connection with this Agreement, the rule of
construction that ambiguities shall be construed against the drafter shall not
be applicable.
11.16 COUNTERPARTS; TELECOPIER. This Agreement may be executed in any
number of counterparts and by the separate parties in separate counterparts and
via telecopier, each of which shall be deemed to constitute an original and all
of which shall be deemed to constitute the one and the same instrument.
IN WITNESS WHEREOF, each of the Equipment Owners, Parent and Purchaser
has executed and delivered this Agreement as of the date first written above.
EQUIPMENT OWNERS
By: /s/ SMR Advisory Group, LC
---------------------------------
SMR Advisory Group, LC
By: /s/ Xxxxxx Xxxxxxxxxxx
---------------------------------
Xxxxxx Xxxxxxxxxxx, President
PARENT:
BIZCOM U.S.A., INC.
By: /s/ Xxxxx Xxxxx
-------------------------------------------------
Xxxxx Xxxxx, Chairman and Chief Executive Officer
PURCHASER:
BIZCOM SOUTHERN HOLDINGS, INC.
By: /s/ Xxxxx Xxxxx
---------------------------------
Xxxxx Xxxxx, President
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