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EXHIBIT 10.53
PURCHASE AGREEMENT BY AND AMONG
WESTERN WIRELESS CORPORATION,
TRIAD TEXAS, L.P. AND
TRIAD UTAH, L.P.
TRIAD OKLAHOMA, L.P.
TRIAD CELLULAR CORPORATION AND
TRIAD CELLULAR L.P.
DATED: APRIL 24, 1997
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PURCHASE AGREEMENT
AGREEMENT, dated April 24, 1997 (the "Agreement"), by and among
WESTERN WIRELESS CORPORATION, a Washington corporation ("Buyer"), TRIAD TEXAS,
L.P., a Delaware limited partnership ("TTLP"), TRIAD UTAH, L.P., a Delaware
limited partnership ("TULP"), TRIAD OKLAHOMA, L.P., a Delaware limited
partnership ("TOLP"; TTLP, TULP and TOLP are hereinafter individually referred
to as a "Seller" and collectively as "Sellers"), TRIAD CELLULAR CORPORATION, a
Delaware corporation ("TCC") and TRIAD CELLULAR L.P., a Delaware limited
partnership ("TCLP"; TCC and TCLP are hereinafter individually referred to as a
"Partner" and collectively as "Partners").
W I T N E S S E T H:
WHEREAS, Sellers are the owners of (i) the Authorizations (as
hereinafter defined) listed on Exhibit 5.01(h) annexed hereto to operate
wireless telephone communications businesses in the geographic areas covered by
such Authorizations (the "Businesses") and (ii) the Businesses and the assets
used in the Businesses; and
WHEREAS, subject to the terms and conditions hereinafter provided,
Buyer desires to purchase from Sellers, and Sellers desire to sell and transfer
to Buyer, the Authorizations and substantially all of the assets of Sellers
relating to the wireless telephone operations covered by the Authorizations.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants, conditions and promises hereinafter set forth, the parties hereby
agree as follows:
ARTICLE 1
PURCHASE OF ASSETS
1.01. Purchase of Assets. Subject to the terms and conditions hereof
and in reliance upon the representations, warranties, covenants and agreements
herein contained, on the Closing Date (as defined in Article 2 hereof),
Sellers, jointly and severally, agree to sell, transfer, convey, assign and
deliver to Buyer, and Buyer agrees to purchase, acquire and accept from
Sellers, the Businesses of Sellers as a going concern including all the assets,
properties, claims and rights of each Seller used in or pertaining to the
Businesses, of every type and description, wherever located, tangible and
intangible, vested or unvested, contingent or otherwise, as the same shall
exist on the Closing Date, whether or not recorded on the books and records of
such Seller and whether or not described herein or in any of the exhibits or
schedules delivered or to be delivered to Buyer hereunder (collectively the
"Purchased Assets"), other than those assets expressly excluded pursuant to the
provisions of Section 1.02 hereof. Such sale and transfer to Buyer shall be
free and clear of all Liens (as hereinafter defined).
Without in any way limiting the generality of the foregoing, the
Purchased Assets include the following:
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(a) All fixed assets of each Seller, including real property,
buildings and improvements to real property, furniture, furnishings, fixtures,
leasehold improvements, office or other equipment, vehicles, all machinery and
equipment of each Seller, including those items referred to on Exhibit 1.01(a)
annexed hereto.
(b) All inventory and supplies of each Seller, including goods in
transit.
(c) The leasehold interests of each Seller described on Exhibit
1.01(c) annexed hereto.
(d) All prepaid property taxes, prepaid rent, prepaid freight,
prepaid insurance and other prepaid expenses, deposits and deferred charges of
each Seller and any and all advances by each Seller to its employees.
(e) All rights and benefits under all contracts to which each
Seller is a party, including contracts of purchase or sale of goods or
services, purchase orders, warranty rights with respect to all machinery,
equipment or other personal property, patent, software and other licenses,
leases of personal property, contracts with agents, and including all Contracts
(as hereinafter defined) referred to on Exhibit 5.01(p) annexed hereto but
excluding those Contracts referred to on Exhibit 5.01(p) annexed hereto as not
being assumed.
(f) All Authorizations.
(g) All patents, trademarks, trade names, service marks and
copyrights and applications for any thereof, operating data, records and other
intangible assets, including all books (other than Sellers' minute books,
corporate seals, stock records and stock transfer books), records, customer and
subscriber lists and credit information, mailing lists and all other customer
or subscriber or potential customer or subscriber data, personnel records of
employees of each Seller and such accounting records as Buyer may reasonably
require, slogans, processes, trade secrets, formulae, job rights, rights to
inventions, engineering data, drawings, art work, photographs and advertising
and promotional materials, suppliers' lists, goodwill and other similar
property and rights, and all claims and interests arising therefrom or relating
thereto, (other than the right, title and interest of each Seller in and to its
corporate or partnership name and any and all logos related thereto) including
the items referred to or described on Exhibit 1.01(g) annexed hereto. Sellers
may make and retain, or Buyer will furnish to Sellers at Sellers' expense
copies of such records as reasonably required by Sellers.
(h) All trade accounts receivable, miscellaneous accounts
receivable, claims receivable and notes receivable of each Seller.
(i) All rights and benefits under the insurance policies described
on Exhibit 1.01(i) annexed hereto as such rights and benefits relate to claims
arising out of events occurring prior to the Closing Date.
1.02. Assets Not Purchased. Notwithstanding anything to the contrary
herein contained, there is hereby expressly excluded from the assets of Sellers
which are being sold, transferred or purchased hereunder the following:
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(a) All cash on hand or in banks;
(b) The ownership interest of Sellers in and to the CoBank Capital
Plan;
(c) Accounts receivable of Sellers from Affiliates which are
listed on Exhibit 1.02(c) annexed hereto;
(d) All inter-company receivables owed by TTLP, TULP or TOLP to TCLP; and
(e) All furniture, equipment and leasehold improvements located in
Sellers' Menlo Park, California offices.
1.03. Buyer's Designee. Buyer shall have the right to assign to one
or more Affiliates of Buyer any and all rights and obligations of Buyer under
this Agreement; provided, however, that, no such assignment shall delay the
Closing beyond October 31, 1997 or relieve Buyer of its obligations hereunder,
and Buyer and its assignee shall be jointly and severally liable for Buyer's
obligations hereunder. "Affiliate" shall mean, with respect to any party
hereto, any corporation or other business entity which directly or indirectly
through stock ownership or through any other arrangement either controls, is
controlled by or is under common control with, such party. The term "control"
shall mean the power to direct the affairs of such person by reason of
ownership of voting stock or other equity interests, by contract or otherwise.
ARTICLE 2
CLOSING AND CLOSING DATE
The consummation of the transactions provided for herein (the
"Closing") shall take place at the offices of Xxxxx Xxxx Xxxxx Constant &
Xxxxxxxx, 00 Xxxxxxxxxxx Xxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx or at such other
mutually agreeable location, at 11:00 A.M. local time, on the latest to occur
of (a) the last Business Day (as hereinafter defined) of the month in which all
Federal Communications Commission ("FCC") and state regulatory approvals (if
any) necessary in order to consummate lawfully the transactions contemplated
hereby have been received and shall have become Final Orders (as hereinafter
defined), (b) the last Business Day of the month in which all applicable
waiting periods under the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976,
as amended (the "HSR Act"), shall have expired or been terminated without
objection by the Federal Trade Commission (the events described in clauses (a)
and (b) above being hereinafter referred to as the "Regulatory Approvals" and
the later of the dates described in clauses (a) and (b) above being referred to
as the "Regulatory Approval Date"), and (c) October 31, 1997, or at such other
time or date to which the parties hereto mutually agree. The day on which the
Closing occurs is herein referred to as the "Closing Date." As used herein the
term "Business Day" shall mean any day other than a Saturday, Sunday or a legal
holiday in New York, New York or in Seattle, Washington or any other day on
which commercial banks are authorized by law or governmental decree to close.
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ARTICLE 3
PURCHASE PRICE AND LIABILITIES
3.01. Calculation of Purchase Price. In consideration of the sale,
transfer, conveyance, assignment and delivery of the Purchased Assets at the
Closing, Buyer shall pay or deliver to Sellers the following (the "Purchase
Price"):
(a) (i) the aggregate amount of One Hundred Thirty-Six
Million ($136,000,000) Dollars in immediately available funds; provided,
however, if the Closing Date shall occur on or prior to December 31, 1997, an
aggregate amount of Ten Million ($10,000,000) Dollars of such payment shall be
deferred until, and be due and payable on, January 5, 1998 (the "Deferred
Payment"). Buyer shall pay to Sellers the Deferred Payment by delivery at the
Closing of Buyer's non-negotiable, non-transferable promissory notes, in the
aggregate principal amount of the Deferred Payment, which promissory notes
shall bear interest at the rate of five (5%) percent per annum and shall be
secured by an irrevocable letter of credit issued by The Toronto-Dominion Bank
or its affiliates or a national bank with capital and surplus in excess of
$100,000,000 in an amount equal to the principal amount of the Deferred
Payment, such letter of credit and promissory notes to be in form and substance
reasonably satisfactory to Sellers; plus or minus (as the case may be)
(ii) the aggregate Working Capital of Sellers as of the
Closing Date. As used herein "Working Capital" means the total of the current
assets (in determining Working Capital (A) the amount of the accounts
receivable of each Seller shall be computed in accordance with the provisions
of Exhibit 3.03(b) annexed hereto and (B) any assets listed in Section 1.02
hereof which are not being purchased by Buyer shall be excluded) of all Sellers
minus the total of the current liabilities of all Sellers (other than current
maturities of long-term indebtedness and all other liabilities of Sellers which
are not being assumed by Buyer as set forth in Section 3.05 hereof), as such
terms are used in accordance with generally accepted principles of accounting.
If the aggregate Working Capital of Sellers as of the Closing Date (A) is a
positive number, the Purchase Price shall be increased by such amount, or (B)
is a negative number, the Purchase Price shall be reduced by such amount; and
plus
(iii) an amount equal to the out-of-pocket capital
expenditures (excluding any capitalized labor) actually made by Sellers which
Buyer consents to in writing and agrees in writing to reimburse to Sellers in
full in cash at the Closing (collectively the "Reimbursable Capital
Expenditures").
The Purchase Price shall be allocated among Sellers and the Purchased
Assets as set forth in Exhibit 3.01 annexed hereto.
3.02. Delivery of Instruments of Transfer. At the Closing, Sellers
shall deliver to Buyer such deeds, bills of sale, assignments and other good
and sufficient instruments of conveyance, transfer and assignment as shall be
necessary to vest in Buyer title in and to the Purchased Assets of the quality
described in Section 5.01(i) hereof.
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3.03. Payment of Purchase Price.
(a) (i) At the Closing Buyer shall pay to Sellers the portion
of the Purchase Price set forth in Section 3.01(a)(i) hereof.
(ii) On or prior to the Closing Date Sellers shall, and
each of the Partners shall cause Sellers to, pay or cause to be paid all
liabilities other than current liabilities reflected in the Closing Date
Balance Sheets (as hereinafter defined) of Sellers as at the Closing Date,
including any and all accrued but unpaid interest, current and long-term
maturities of long-term indebtedness, prepayment penalties and fees and
expenses relating thereto (and Sellers may direct Buyer to pay all or a portion
of the Purchase Price payable under Section 3.03(a)(i) hereof to pay such
liabilities). Sellers shall provide to Buyer on the Closing Date evidence
reasonably satisfactory to Buyer of Sellers' payment of such liabilities and of
the release or termination of all Liens on any of the Purchased Assets of
Sellers which secured such liabilities.
(b) (i) At least five (5) Business Days prior to the Closing
Date, Sellers shall deliver to Buyer (A) Sellers' bona fide written estimate of
the Working Capital and Reimbursable Capital Expenditures, certified by the
chief financial officer of each Seller, which estimate, unless otherwise agreed
in writing by Buyer, shall be, in the case of Working Capital, the Working
Capital of Sellers as shown on the then most recently prepared and available
monthly balance sheets of Sellers (such balance sheets to be prepared by
Sellers on a basis consistent with prior periods), and in the case of
Reimbursable Capital Expenditures, the actual amount thereof, such actual
amount to be certified by Sellers' chief financial officer and such
certification to be accompanied by evidence reasonably satisfactory to Buyer as
to the accuracy and completeness of the amounts so certified, and (B) the
unaudited financial statements of each Seller as of, and for such portion (as
requested by Buyer) of the fiscal year ended through, the end of the month
immediately preceding the Closing Date, certified by the Chief Financial
Officer of such Seller, which financial statements shall have been prepared in
accordance with generally accepted accounting principles consistently applied.
On the Closing Date (1) in the event the aggregate of estimated Working Capital
and the Reimbursable Capital Expenditures is a positive number, the Purchase
Price payable pursuant to Section 3.01 hereof shall be the sum of the amount
payable pursuant to Section 3.01(a)(i) plus an amount equal to such bona fide
written estimate of the Working Capital and the Reimbursable Capital
Expenditures and shall be paid by Buyer to Sellers in immediately available
funds on the Closing Date, or (2) in the event the aggregate of the estimated
Working Capital and the Reimbursable Capital Expenditures is a negative number,
the Purchase Price payable pursuant to Section 3.01 hereof shall be the sum of
the amount payable pursuant to Section 3.01(a)(i) minus an amount equal to such
bona fide written estimate of the Working Capital and the Reimbursable Capital
Expenditures.
(ii) Sellers shall deliver to Buyer within forty-five (45)
days after the end of the month in which the Closing shall have occurred
balance sheets of each Seller as of the Closing Date (the "Closing Date Balance
Sheets") prepared by each Seller on a basis consistent with prior periods. In
calculating revenues and expenses for the period between the first day of the
month in which the Closing occurs and the Closing Date, items of revenue and
expense shall be calculated by multiplying the aggregate amount of each such
item realized or incurred during the month in which the Closing occurs by a
fraction, the numerator of which shall be the day of the month on which the
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Closing occurs and the denominator of which shall be the number of days in the
month in which the Closing occurs. Buyer and Sellers shall, as promptly as
practicable but in no event later than ninety (90) days following the Closing
Date, determine the amount of the Working Capital and the Reimbursable Capital
Expenditures as of the close of business on the Closing Date. Buyer and
Sellers shall, and shall cause their respective independent certified public
accountants to, give each other and their respective representatives full
access to each other's books and records (which relate to or are necessary for
the determination of the Working Capital and the Reimbursable Capital
Expenditures) and representatives during regular business hours upon reasonable
notice for the purpose of determining the Working Capital and the Reimbursable
Capital Expenditures. The parties shall in good faith attempt to resolve any
dispute concerning the Working Capital and the Reimbursable Capital
Expenditures. If the parties do not reach agreement concerning the Working
Capital and the Reimbursable Capital Expenditures within ninety (90) days
following the Closing Date, then the parties shall submit the matter for
resolution to a nationally recognized firm of independent certified public
accountants which has not had a material relationship with either Buyer and its
Affiliates or Sellers and their Affiliates within the preceding two years (the
"Arbiter") and which is mutually agreeable to the parties. If the parties
cannot agree on the selection of the Arbiter, the Arbiter shall be selected by
mutual agreement of the parties' respective independent certified public
accountants, or, if they cannot agree, the parties shall request the American
Arbitration Association (the "AAA") to appoint the Arbiter, and such
appointment by the parties' respective independent certified public accountants
or the AAA, as the case may be, shall be conclusive and binding on the
parties. Promptly, but no later than twenty (20) days after its acceptance of
its appointment as Arbiter, the Arbiter shall determine, based solely on
presentations by Buyer and Sellers, and not by independent review, only those
issues concerning the Working Capital and the Reimbursable Capital Expenditures
which are in dispute and shall render a report as to the dispute and the
resulting computation of the Working Capital and the Reimbursable Capital
Expenditures, which shall be conclusive and binding upon the parties. The
fees, costs and expenses of the Arbiter shall be paid one-half by Buyer and
one-half by Sellers; provided, however, that the Arbiter shall have the right
(but not the obligation) to reapportion the fees, costs and expenses of the
Arbiter between Buyer and Sellers in accordance with the Arbiter's
determination of the relative merit of the parties' respective positions on the
matters in dispute. Within five (5) Business Days of the determination of the
Working Capital and the Reimbursable Capital Expenditures, whether by mutual
agreement of the parties or by the Arbiter, and provided there is a difference
between such aggregate amount and the estimated aggregate of the Working
Capital and the Reimbursable Capital Expenditures, (A) if the aggregate of the
estimated Working Capital and the Reimbursable Capital Expenditures is greater
than the aggregate of the Working Capital and the Reimbursable Capital
Expenditures, then Sellers shall pay to Buyer, or, in Buyer's discretion, to
Buyer's designee, in cash such difference, or (B) if the aggregate of the
Working Capital and the Reimbursable Capital Expenditures is greater than the
aggregate of the Estimated Working Capital and the Reimbursable Capital
Expenditures, Buyer shall pay to Sellers in cash such difference.
Notwithstanding anything to the contrary contained in this Agreement, Buyer and
Sellers agree that in determining the Working Capital and the Reimbursable
Capital Expenditures pursuant to this Section 3.03(b), the amounts of the
accounts receivable of each Seller at the Closing Date shall be computed in
accordance with the provisions of Exhibit 3.03(b) annexed hereto.
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(c) Sellers shall, and each of the Partners shall cause Sellers
to, pay at the Closing or, if due thereafter, promptly when due, all gross
receipts taxes, transfer taxes, sales taxes, stamp taxes and any other taxes
(collectively, "Transfer Taxes") payable in connection with the transfer of the
Purchased Assets and the Businesses from Sellers to Buyer hereunder. Sellers
shall prepare and file any tax return with respect to such Transfer Taxes;
provided, however, that Buyer shall have the right of reasonable review and
comment prior to such filing (such right to be exercised by Buyer within five
(5) Business Days after delivery of such returns to Buyer, and if such right is
not so exercised within such five (5) day period, Buyer shall be deemed to have
waived such right).
3.04. Assumed Liabilities. Subject to the terms and conditions
hereof and in reliance upon the representations, warranties, covenants and
agreements herein contained, at the Closing Buyer agrees to assume and perform,
according to their respective terms, the following obligations of Sellers as
the same shall exist at the Closing Date:
(a) obligations under the leases listed on Exhibit 1.01(c) annexed
hereto, including obligations arising under leases entered into after the date
hereof as permitted by Section 4.01(c) hereof;
(b) obligations under the Contracts listed on Exhibit 5.01(p)
annexed hereto, including obligations arising under Contracts entered into
after the date hereof as permitted by Section 4.01(c) hereof; and
(c) liabilities reflected on the Closing Date Balance Sheets
(other than liabilities which are not being assumed by Buyer as set forth in
Section 3.05 hereof), including obligations arising under Contracts and leases
entered into after the date hereof as permitted by Section 4.01(c) hereof and
including sales or similar taxes which are reflected on the Closing Date
Balance Sheet and which were deducted in computing Working Capital;
provided, however, that Buyer shall not assume any such liabilities or
obligations resulting from breaches of or defaults by Sellers under any of such
leases or Contracts attributable to any period ending prior to or on the
Closing Date unless reflected on the Closing Date Balance Sheets and unless
such liabilities are not excluded liabilities pursuant to Section 3.05 hereof.
3.05. Excluded Liabilities. Notwithstanding anything to the contrary
herein contained, Buyer shall not assume any liabilities of any Seller other
than as expressly set forth in Section 3.04 hereof. Any liabilities or
obligations of any Seller not specifically assumed by Buyer hereunder shall
continue to be the liabilities and obligations of Sellers and Sellers shall
jointly and severally indemnify and hold harmless Buyer from and against all
such liabilities and obligations. The liabilities and obligations of Sellers
not assumed by Buyer hereunder include the following:
(a) Liabilities or obligations of any Seller arising out of the
indemnification agreements contained in Article 7 hereof;
(b) Any claim, liability or obligation, known or unknown, whether
absolute, contingent or otherwise, the existence of which is a breach of any
representation, warranty or covenant of, any Seller set forth in this
Agreement;
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(c) Liabilities or obligations of any Seller arising on or after
the Closing;
(d) Liabilities or obligations of any Seller arising out of this
Agreement or the transactions contemplated hereby or incurred in respect of any
transaction occurring after the Closing;
(e) Liabilities for all taxes (other than taxes which are
reflected on the Closing Date Balance Sheets and which were deducted in
computing Working Capital) whatsoever, whether income, gross receipts,
property, sales, use, franchise or any other taxes whatsoever, including taxes,
if any, attributable to the sale of the Businesses and Purchased Assets
hereunder, any liquidation and dissolution of any Seller or the distribution of
its assets to its equity holders;
(f) Liabilities for breach of representations or warranties to any
person and liabilities arising out of product liability, negligence or willful
misconduct claims; and
(g) Liabilities, claims, obligations, judgments, orders, duties or
responsibilities of any kind or nature whatsoever, whether arising before, on
or after the Closing Date, relating to amounts payable to Employees (as
hereinafter defined) as salary, bonus, severance or other compensation or
benefits and with respect to any Employee Plans (as hereinafter defined) which
are now or ever have been maintained, contributed to or required to be
contributed to for the benefit of any Employee.
Sellers, jointly and severally, covenant and agree to pay all
liabilities and to fulfill all obligations of any Seller not assumed by Buyer
hereunder as and when the same become due, except those being contested in good
faith by appropriate proceedings and for which adequate reserves have been
established.
ARTICLE 4
COVENANTS AND AGREEMENTS
4.01. Covenants of Sellers. Each of Sellers and each of Partners,
jointly and severally, covenants and agrees from and after the execution and
delivery of this Agreement to and including the Closing Date as follows:
(a) Consummate Transactions. Each Seller and each Partner shall
use its best efforts to cause the transactions contemplated by this Agreement
to be consummated in accordance with the terms hereof, and, without limiting
the generality of the foregoing, use its best efforts to obtain all necessary
approvals, consents, permits, licenses and other authorizations required in
connection with this Agreement and the transactions contemplated hereby of
third parties including all governmental authorities and agencies such as the
FCC, and any state public utilities or public service commission, and to make
all filings with and to give all notices to third parties which may be
necessary or reasonably required of any Seller, in order to consummate the
transactions contemplated hereby, including the transfer and delivery from
Sellers to Buyer of the Businesses and the Purchased Assets.
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(b) Full Access. Each Seller and each Partner shall give to Buyer
and its agents and representatives (including its independent auditors and
attorneys) reasonable access (such access not to interfere unreasonably with
Sellers' Businesses) during normal business hours and upon reasonable notice as
described below to all of such Seller's or Partner's personnel, premises,
properties, assets, financial statements and records, books, contracts,
documents and commitments of or relating to the Businesses or the Purchased
Assets, and shall furnish Buyer and its agents and representatives with all
such information concerning the affairs of such Seller as Buyer may reasonably
request. In addition, Sellers and Partners shall permit Buyer's accountants to
conduct an audit (at Buyer's expense) of the books and records of Sellers in
such detail as Buyer may reasonably require. Buyer shall contact either Xxxxx
X. Xxxxx, Xxxxx X. Xxxxxxx or any other person(s) designated by Sellers, on
behalf of all Sellers, to arrange for Buyer's personnel, agents and
representatives visiting any of Seller's premises or personnel, agents or
representatives, such visits to be arranged for by Sellers not later than three
(3) Business Days of Buyer's request therefor.
(c) Ordinary Course. Each Seller shall, and each Partner shall
cause each Seller to, conduct its Businesses only in the ordinary course and
consistent with past practices. Without limiting the foregoing, each Seller
shall, and each Partner shall cause each Seller to (i) continue to expend funds
for sales promotion and marketing and to pay its bills and other obligations,
all in the ordinary course of business consistent with past practices; and (ii)
make all capital expenditures described on or set forth in Exhibit 4.01(q)
annexed hereto or which Buyer otherwise consents to in writing. Without
limiting the foregoing, no Seller shall, and no Partner shall cause or permit
any Seller to, without the prior written consent of Buyer, such consent not to
be unreasonably withheld, (A) incur any material liability, absolute or
contingent, other than current liabilities arising in the ordinary course of
business or pursuant to Contracts in existence on the date hereof and set forth
or described in Exhibit 5.01(p) annexed hereto or hereafter entered into as
permitted pursuant to this Agreement and other than additional loans from TCLP
with the proceeds of draws made under the Loan Agreement referenced in item 2
of Exhibit 5.01(m) hereto; (B) assume, guarantee, change any existing
guarantee, endorse or otherwise as an accommodation become responsible for
obligations of any other individual or entity (except by endorsement for
collection or deposit of negotiable instruments received in the ordinary course
of business and except pursuant to Contracts in existence on the date hereof
and set forth or described in Exhibit 5.01(p) annexed hereto); (C) other than
in the ordinary course of business and in amounts not exceeding $25,000 in the
aggregate, make any loans or advances to any individual or entity; provided,
however, that TCLP shall be permitted to distribute an aggregate of $7,500,000
(1) to TCC to enable TCC to pay debt of TCC, or (2) to make equity
distributions or loans to its partners and affiliates, in either case so long
as such distributions would not have a material adverse effect on the business,
operations or prospects of the Sellers or on the transactions contemplated
hereby; (D) sell, transfer, convey, mortgage, pledge, hypothecate or subject to
any lien, claim, security interest, charge, encumbrance, restriction, title
retention agreement or any liability or claim of any nature (all of the
foregoing, collectively "Liens") any of the Purchased Assets or the Businesses
except for sales of subscriber equipment or retirements of old or obsolete
equipment (such retired equipment to be replaced with equipment of equivalent
cost and utility) in the ordinary course of business or pursuant to agreements
or binding commitments in existence on the date hereof and set forth or
described in Exhibit 5.01(p) annexed hereto or Liens which in the aggregate are
not material and have been incurred in the ordinary
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course of business and which Liens will be released on or prior to the Closing
Date; (E) intentionally waive or compromise any right or claim for any amount
in excess of $25,000; (F) cancel, without fair consideration, any note, loan or
other material obligation owing to it; (G) enter into or extend or renew any
Contract with (1) except for Contracts having an annual cost of less than
$5,000 for any single contract and $50,000 for all such Contracts, any Person
(as hereinafter defined) which is not assignable to Buyer and terminable at
will on not more than thirty (30) days notice and without material liability,
or (2) any Seller or Partner or any Affiliates, partners, employees, agents or
assigns of any Seller or Partner or of any Seller's or Partner's Affiliates;
(H) make any increase in the compensation payable or to become payable by any
Seller to any of its officers, employees, agents or consultants except for
routine increases made in the ordinary course of business consistent with past
practices, which in any event shall not exceed five (5%) percent; (I) make any
arrangement for any new or additional, or amend or extend any existing,
profit-sharing plan, retirement plan, bonus plan, severance arrangement,
employee benefit plan, or any similar plan, or make or agree to make any change
to any such plan if the result thereof increases any benefits paid or payable
thereunder to any Person; (J) except as required by law, enter into any
collective bargaining agreement, or make any commitment whatsoever to any union
or other representative or party which intends to represent any employees; (K)
extend the maturity date of or renew any (1) indebtedness for borrowed money or
for the deferred purchase price of property or services or evidenced by notes,
bonds or other instruments, (2) lease obligations which would normally be
capitalized under generally accepted accounting principles, or (3) obligations
under direct or indirect guarantees of (including obligations (contingent or
otherwise) to assure a creditor against loss in respect of) indebtedness or
obligations of others of types referred to in subclauses (1) and (2) above (the
obligations specified in this clause (K) are collectively referred to herein as
"Indebtedness"), if such Indebtedness will survive the Closing; (L) prepay,
other than as contemplated by the provisions of Section 3.03(a)(ii) hereof,
prior to its stated maturity any Indebtedness or any lease or rental or any
other amounts; or (M) enter into any reseller agreements or any agent
agreements other than in the ordinary course of business consistent with past
practice and only so long as such agreements are assignable to Buyer and
terminable at will, without penalty, by Sellers or Buyer upon not more than
thirty (30) days' notice. As used herein the term "Person" means any general
or limited partnership, corporation, joint venture, trust, business trust,
governmental agency, cooperative, association, individual or other entity, and
heirs, executors, administrators, legal representatives, successors and assigns
of such person.
(d) Preserve Goodwill. Sellers shall, and each Partner shall
cause Sellers to, use their diligent efforts to preserve the Businesses of each
Seller and the goodwill of suppliers, subscribers and others dealing with each
Seller, and to retain the services of the employees of each Seller and to
maintain the goodwill of such employees.
(e) Compliance with Law. Each Seller shall, and each Partner
shall cause each Seller to, comply in all material respects with all applicable
laws, rules, ordinances, regulations, codes, orders, decrees, licenses and
permits of all applicable jurisdictions and governmental authorities or
agencies relating to it, to its properties (including the Businesses and the
Purchased Assets) or to the conduct of its Businesses.
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(f) Approvals, Consents. Each Seller shall, and each Partner
shall cause each Seller to, obtain and maintain in full force and effect all
approvals, consents, permits, licenses and other authorizations, from all
appropriate Federal, state and local governmental agencies or authorities
necessary or required for the operation of such Seller's Businesses as
presently conducted, as and when such approvals, consents, permits, licenses or
other authorizations are necessary or required except, in the case of
non-material approvals, consents, permits, licenses or other authorizations of
state and local governmental agencies and authorities, where such failure would
not have a material adverse effect on such Seller, its financial condition,
prospects, the Purchased Assets or the Businesses. The parties shall consult
with one another as to the general approach to be taken with any governmental
authority or agency with respect to obtaining any necessary consent of such
governmental agency or authority to the transactions contemplated hereby, and
each of the parties shall keep each other party reasonably informed as to the
status of any such communications with any governmental authority or agency.
Each Seller shall not, and each Partner shall cause each Seller not to, with
respect to the Authorizations, the Businesses or the Purchased Assets, make any
material commitments (other than those typical in the wireless telephone
industry) relating to any approval, consent, permit or license to any
governmental authority or agency without the prior written consent of Buyer.
(g) No Transfer. None of Sellers shall, and none of Partners
shall cause or permit any Seller to, (i) sell, transfer, assign or dispose of,
or offer to, or enter into an agreement to, sell, transfer, assign or dispose
of any of the Purchased Assets or the Businesses or negotiate therefor, other
than sales of such of the Purchased Assets that are immaterial or that are no
longer useable in the Businesses or which are being replaced with assets of
comparable quality and utility in the ordinary course of business consistent
with past practice or (ii) create, incur or suffer to exist any Lien of any
nature whatsoever or enter into any restriction on transfer or grant any right
of first refusal relating to the Purchased Assets or the Businesses, other than
Liens not in the aggregate material to the business or financial condition of
such entity and which Liens will be terminated on or prior to the Closing Date.
(h) Insurance. From the date hereof through the Closing Date,
each Seller shall, and each Partner shall cause each Seller to, maintain in
full force and effect (including necessary renewals thereof) all of the
insurance policies relating to such Seller set forth on Exhibit 5.01(j) annexed
hereto existing on the date hereof. From and after the Closing Date, each
Seller shall, and each Partner shall cause each Seller to, take all action that
may be necessary to cause the coverage under such policies to continue in full
force and effect after the Closing Date with respect to occurrences prior to
the Closing Date and shall take all actions necessary to preserve or protect
rights under any such policies with respect to any claim against any Seller
arising out of the Purchased Assets or Businesses of Sellers prior to the
Closing Date. Sellers shall, and Partners shall cause Sellers to, provide
Buyer with information and records regarding all claims pending with respect to
the Purchased Assets or Businesses of Sellers and agree to provide to Buyer any
additional information and records Buyer may reasonably require regarding such
claims.
(i) No Amendments or Issuance of Additional Shares. No Seller
shall, and no Partner shall cause or permit any Seller to, amend its charter,
by-laws, partnership agreement, or comparable governing instrument, which
amendment would have a material adverse effect on the
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Purchased Assets, the Businesses or the transactions contemplated by this
Agreement or which would require any additional consents or approvals of the
transactions contemplated by this Agreement. No Seller shall, and no Partner
shall cause or permit any Seller to, issue or sell any shares of its capital
stock, partnership interests or other securities, or issue options, warrants or
rights of any kind to acquire, or any securities convertible into, exchangeable
for or representing a right to purchase or receive, or enter into any contract,
plan, understanding or arrangement with respect to the issuance of, any
stock-based or stock-related awards or other equity-based awards, shares of its
capital stock or other equity or other securities, or enter into any
arrangement or contract with respect to the purchase or voting of shares of its
capital stock or other equity, or adjust, split, combine or reclassify any of
its securities, or make any other changes in its capital structure, if any such
issuance, sale, contract, plan, understanding, arrangement, adjustment, split,
combination, reclassification or changes would require any additional approvals
of the transactions contemplated by this Agreement or would otherwise adversely
affect the transactions contemplated by this Agreement.
(j) Condition of Assets. Each Seller shall, and each Partner
shall cause each Seller to, use its diligent efforts to preserve its assets
intact and, from time to time, to make all necessary repairs thereto, so that
the Businesses carried on by it may be conducted in the ordinary course of
business and consistent with past practices.
(k) Books and Records. Each Seller shall, and each Partner shall
cause each Seller to, maintain its books, accounts and records in the usual
manner, on a basis consistent with prior years and in accordance with generally
accepted accounting principles.
(l) Notice of Claims. Each Seller shall, and each Partner shall
cause each Seller to, give written notice to Buyer promptly upon the
commencement of any action, investigation, arbitration or proceeding (including
any proceeding before any governmental agency), or promptly upon obtaining
knowledge of any facts giving rise to a threat of any such action,
investigation, arbitration or proceeding (i) which would, if adversely
determined, materially and adversely affect (A) any Seller's ability to
consummate the transactions contemplated hereby or (B) the business or
financial condition of any Seller, any Businesses or the Purchased Assets or
(ii) where the amount involved exceeds $25,000.
(m) Certain Actions. None of Sellers shall, and none of Partners
shall cause or permit any Seller to, take any action or refrain from taking any
action which would materially interfere with or preclude the consummation of
the transactions contemplated by this Agreement, result in any of the
representations and warranties of any Seller or any Partner contained herein
being incorrect or incomplete in any material respect, or result in any of the
conditions to Buyer's obligation to consummate the transactions contemplated by
this Agreement as set forth in Section 6.01 hereof being unsatisfied in
accordance with the terms hereof.
(n) Dividends, Distributions and Other Payments. None of Sellers
shall, and none of Partners shall cause or permit any Seller to, declare or
make any dividends, distributions or other payments (whether of loans or
otherwise) to any shareholder or partner of any of Sellers or to any Affiliate
of any shareholder or partner of Sellers; provided, however, that TCLP shall be
permitted
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to distribute an aggregate of $7,500,000 (i) to TCC to enable TCC to pay debt
of TCC, or (ii) to make equity distributions or loans to its partners or
affiliates, in either case so long as such distributions would not have a
material adverse effect on the business, operations or prospects of the Sellers
or on the transactions contemplated hereby.
(o) Notice of Breaches. Each Seller shall, and each Partner shall
cause each Seller, promptly after obtaining knowledge of the occurrence of, or
the impending or threatened occurrence of, any event which would cause or
constitute a breach of any warranties, representations, covenants or agreements
of any Seller or any Partner contained in this Agreement, give notice in
writing of such event or occurrence or impending or threatened event or
occurrence, to Buyer and use its diligent efforts to prevent or promptly remedy
such breach.
(p) Material Contracts. None of Sellers shall, and none of
Partners shall cause or permit any Seller to, default in any material respect
under, or breach any term or provision of, or suffer or permit to exist any
condition or event which, after notice or lapse of time, or both, would
constitute a material default by Sellers under, any Contract listed on Exhibit
5.01(p) annexed hereto or which are entered into after the date hereof and
prior to the Closing as permitted by Section 4.01(c) and which would have been
listed on such Exhibit if they were in effect on the date hereof.
(q) Capital Expenditures. Following the date hereof and prior to
the Closing Date, each Seller shall, and each Partner shall cause each Seller
to, make the capital expenditures of the type and in the amounts set forth on
Exhibit 4.01(q) annexed hereto and such other capital expenditures to which
Buyer shall consent in writing and agree in writing to reimburse to Sellers in
full in cash at the Closing.
(r) Notification of Change. Each Seller shall, and each Partner
shall cause each Seller to, advise Buyer promptly in writing of (i) any event,
condition or state of facts, including any action, suit or proceeding, which
has had or would have a material adverse effect on the business or financial
condition of any Seller, on the Businesses or the Purchased Assets or on the
transactions contemplated by this Agreement or (ii) the commencement of any
action, suit or proceeding which seeks to enjoin the consummation of the
transactions contemplated hereby.
(s) Retention of Records. On the Closing Date, Sellers shall, and
Partners shall cause Sellers to, deliver to Buyer all books, contracts and
records of Sellers relating to the Businesses or to the Purchased Assets, other
than Sellers' minute and stock records books; provided, however, Sellers shall
be entitled to retain a copy of all books, accounting and other records
following the Closing for purposes of winding up their respective affairs and
other proper purposes incidental to the transactions contemplated hereby.
Buyer agrees that after the Closing Date all books, contracts and records
relating to the Purchased Assets and the Businesses prior to the Closing Date,
shall for a period of five (5) years following the Closing Date or, if later,
up to the termination of the statute of limitations for any matter with respect
to which Sellers or Partners are indemnifying Buyer and its Affiliates
hereunder, be available at the written request of and at the expense of Sellers
during regular business hours to Sellers and their authorized representatives,
accountants and attorneys for any reasonable business purpose. All information
so made available to any Seller or retained by Seller after the Closing Date
shall be held in confidence by such Seller in accordance with
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Section 9.11 hereof. In addition, for a period of five (5) years after the
Closing Date, at the written request and expense of Buyer, Sellers shall, and
Partners shall cause Sellers to, make available to Buyer copies of any
documents not theretofore delivered to Buyer relating to any potential or
actual tax liabilities of Sellers for any periods ending on or prior to the
Closing Date.
(t) Interim Financial Statements and Statistical Summaries.
Between the date of this Agreement and the Closing Date, each Seller shall, and
each Partner shall cause each Seller to, deliver to Buyer (i) as soon as
practicable but no later than forty-five (45) days after the end of each
calendar month with respect to such Seller unaudited financial statements
("Interim Financial Statements") for the most recent month and the interim
period then ended and (ii) within ten (10) Business Days after the end of each
calendar month with respect to such Seller interim statistical summaries (the
"Interim Statistical Summaries") for the most recent month and interim period
then ended, which summaries will be in scope and format substantially identical
to the Statistical Summaries (as hereinafter defined).
(u) No Termination or Settlement. Without the prior written
consent of Buyer, which consent shall not be unreasonably withheld, none of
Sellers shall, and none of Partners shall cause or permit any Seller to,
terminate any agent or settle any dispute with any agent if such termination or
settlement would cause Buyer to have any continuing obligation after the
Closing with respect thereto.
(v) Training. At the request of Buyer, Sellers shall, and
Partners shall cause Sellers to, train Buyer's employees and agents in the use
of Sellers' billing system, such training to be provided at Sellers' premises
at mutually convenient times so as not to disrupt Sellers' Businesses and at no
cost to Buyer. In addition Sellers shall, and Partners shall cause Sellers to,
at the request of Buyer, use all commercially reasonable efforts to assist, and
shall cause its employees, agents, officers and subcontractors to assist, Buyer
in converting and transferring Sellers' subscribers to Buyer's billing system
so that at the Closing Date or as soon thereafter as is reasonably practicable
all of Sellers' subscriber information shall have been transferred and
converted to Buyer's billing system.
(w) Dismissal with Prejudice. Sellers shall, and each Partner
shall cause Sellers to, deliver to Buyer, and Buyer shall deliver to Sellers,
all such documents and instruments as Buyer or Sellers shall reasonably
request, to effect the dismissal with prejudice of all informal objections,
petitions to deny or other actions or filings before the FCC or any other
regulatory agency or any other Legal Matters (as hereinafter defined) (except
for any Legal Matters arising under this Agreement or the Concurrent
Agreements) whether or not listed on Exhibit 5.01(d) to which Buyer or any
Affiliate of Buyer is a party, or affecting any Authorizations or application
for Authorizations of Buyer or any Affiliate of Buyer on the one hand, and
Sellers or any Affiliate of Sellers, on the other hand.
4.02. Covenants of Buyer. Buyer covenants and agrees that from and
after the execution and delivery of this Agreement to and including the Closing
Date:
(a) Consummate Transaction. Buyer shall use its best efforts to
cause the transactions contemplated by this Agreement to be consummated in
accordance with the terms hereof, and,
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without limiting the generality of the foregoing, to obtain all necessary
consents and authorizations of third parties, including the approval of this
Agreement and the transactions contemplated hereby by all governmental
authorities and agencies, including the FCC and any state public utilities or
public service commission, and to make all filings with and to give all notices
to third parties which may be necessary or reasonably required of Buyer in
order to consummate the transactions contemplated hereby.
(b) Buyer Not to Control. Notwithstanding any provision of this
Agreement that may be construed to the contrary, pending the Closing, each
Seller shall maintain actual (de facto) and legal (de jure) control over its
Businesses. Specifically, the responsibility for the operation of each
Seller's Businesses shall, pending the Closing, reside with its general
partners or board of directors, as the case may be, including responsibility
for the following matters: (i) access to and the use of the facilities of and
equipment owned by such Seller; (ii) control of the daily operation of such
Seller; (iii) creation and implementation of policy decisions; (iv) employment
and supervision of employees; (v) payment of financing obligations and expenses
incurred in the operation of such Seller; (vi) receipt and distribution of
monies and profits derived from the operation of such Seller; and (vii)
execution and approval of all contracts and applications prepared and filed
before regulatory agencies.
4.03 Governmental Filings. Each of Sellers and each of Partners,
jointly and severally, and Buyer covenant and agree from and after the
execution and delivery of this Agreement to and including the Closing Date as
follows:
(a) It is understood that the Closing of this transaction is
subject to prior approval of the FCC and may be subject to the prior approval
of one or more state regulatory commissions. The parties shall use their best
efforts to file with the FCC and any relevant state agency or agencies, as soon
as practicable following the date hereof and in no event later than ten (10)
Business Days from the date hereof, a joint application requesting the approval
of the transfer of the Authorizations, Businesses and Purchased Assets to
Buyer, or its designee. Each of the parties hereto shall diligently take or
cooperate in the taking of all steps which are necessary or appropriate to
expedite the prosecution and favorable consideration of such applications. The
parties covenant and agree to undertake all actions reasonably requested by the
FCC or other regulatory authority and to file such material as shall be
necessary or required to obtain any necessary waivers or other authority from
the FCC or such state agency or agencies in connection with the foregoing
applications.
(b) Within fifteen (15) Business Days of the date of execution
hereof, Buyer and Sellers shall file, or cause to be filed, with the Federal
Trade Commission and the Antitrust Division of the Department of Justice any
and all reports or notifications which are required to be filed under the HSR
Act or other Federal law or administrative regulations.
4.04. Cooperation. Each of Sellers and each of Partners, jointly and
severally, and Buyer agree to cooperate with and to take all actions reasonably
requested by the other so as to minimize, to the extent possible, any
disruption to any of Sellers' operations upon the Closing and, in connection
therewith, each of Sellers shall, and each of Partners shall cause each Seller
to, provide, subject to the last sentence of Section 4.01(b) hereof, Buyer with
reasonable access to its employees
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and facilities prior to the Closing Date, and shall cause such Seller's
employees, agents, advisors, subcontractors and representatives to work with
Buyer and its employees, agents, advisors, subcontractors and representatives
for purposes of planning for and implementing the transfer of control of the
Businesses and Purchased Assets to Buyer on the Closing Date.
4.05. Bulk Sales. Each of the parties hereto waives the obligation
of the other parties under the provisions of any "Bulk Sales" laws of the
uniform commercial code as in effect in any state having jurisdiction over any
Seller or the transactions contemplated hereby.
ARTICLE 5
REPRESENTATIONS AND WARRANTIES
5.01. Sellers' Representations and Warranties. Each of Sellers and
each of Partners, jointly and severally, represent and warrant to Buyer, which
representations and warranties shall survive the execution and delivery of this
Agreement and the consummation of the transactions herein contemplated, as
follows:
(a) Due Organization. TCC is a corporation duly organized,
validly existing and in good standing under the laws of the State of Delaware,
and each of TCLP and each Seller is a limited partnership, duly organized,
validly existing and in good standing under the laws of the State of Delaware.
Each Seller and each Partner has all requisite corporate or partnership, as the
case may be, power and authority to own, operate and lease its property and to
carry on its business as now conducted. Each Seller and each Partner is duly
qualified to do business and is in good standing in all states where the
conduct of its business or the ownership of its properties makes such
qualification necessary, except where the failure to so qualify would not have
a material adverse effect on such Seller or Partner, its financial condition or
business, or the transactions contemplated hereby. The certificates of
incorporation, by-laws or partnership agreements, as applicable, of Sellers and
Partners to be delivered to Buyer pursuant to this Agreement will be true,
correct and complete as of the date of delivery thereof.
(b) Power and Authority; No Violation. Each Seller and each
Partner has full power and authority to execute, deliver and perform its
obligations under this Agreement, and to consummate the transactions
contemplated hereby. This Agreement and all transactions contemplated hereby
have been duly and validly authorized by all necessary action on the part of
each Seller and each Partner and this Agreement constitutes a legal, valid and
binding obligation of each Seller and each Partner enforceable in accordance
with its terms except as such enforceability may be limited by bankruptcy,
insolvency, moratorium or other similar laws affecting or relating to
enforcement of creditors' rights generally. Neither the execution, delivery or
performance of this Agreement by any Seller or Partner, nor the consummation of
the transactions contemplated hereby will, with or without the giving of notice
or the passage of time, or both (i) conflict with, result in a default or loss
of rights (or give rise to any right of termination, cancellation or
acceleration) under, or result in the creation of any Lien, pursuant to (A) any
provision of the certificate of incorporation, by-laws or partnership
agreement, shareholders agreement or other constituent documents of any Seller
or any Partner; (B) any material note, bond, indenture, mortgage, deed of
trust, contract, agreement, lease or other instrument or obligation to which
any Seller or any Partner
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is a party or by which any Seller or any Partner or its properties may be bound
or affected; or (C) any law, order, judgment, ordinance, rule, regulation or
decree to which any Seller or any Partner is a party or by which its properties
are bound or affected; or (ii) give rise to any right of first refusal or
similar right with respect to any interest, or any properties or assets, of any
Seller or any Partner. Except as described on Exhibit 5.01(b) annexed hereto,
no permit, consent, filing or approval of any third party is required to be
obtained or made by any Seller or any Partner in connection with the execution
and delivery of this Agreement or the consummation of the transactions
contemplated hereby in order to (A) render this Agreement and the transactions
contemplated hereby valid and effective and (B) enable Sellers to sell the
Purchased Assets and Businesses to Buyer and to consummate the transactions
contemplated hereby. None of Sellers and none of Partners have granted any
powers of attorney granting to any Person the right to bind such Seller or
Partner other than those to be released on or prior to the Closing Date or
those which do not relate to the Businesses, the Purchased Assets or the
transactions contemplated hereby.
(c) Financial Statements. Exhibit 5.01(c) annexed hereto contains
a list of audited and unaudited financial statements of each Seller for the
periods indicated on such Exhibit 5.01(c) (the "Operating Financial
Statements") and a list of Key Statistical Summaries of each Seller for the
periods indicated on such Exhibit 5.01(c) (the "Statistical Summaries"). True
and complete copies of each item listed thereon have previously been delivered
to Buyer. The Operating Financial Statements are, and the Interim Financial
Statements will be, true and correct in all material respects, have been or
will be prepared from the books and records of each Seller and fairly present
or will fairly present the financial position of each Seller in a manner
consistent with prior periods as of the dates of such statements and the
results of its operations and statements of cash flow for the year or interim
period then ended, in each case in conformity with generally accepted
accounting principles applied on a basis consistent with past practices. The
Statistical Summaries are, and the Interim Statistical Summaries will be, true
and correct in all material respects and have been or will be prepared from the
books and records of each Seller in a manner consistent with prior periods.
None of Sellers has incurred nor is it subject to any liabilities or
obligations, whether accrued, absolute or contingent, which are in the
aggregate material to the business or financial condition of such Seller, and
which have not been (i) reflected or accrued against in the Operating Financial
Statements of such Seller, (ii) incurred since the date of the latest Operating
Financial Statements as permitted by Section 4.01(c) hereof and will be
reflected on the Interim Financial Statements or the Closing Date Balance
Sheets, as the case may be, or (iii) reflected in the Exhibits annexed hereto.
(d) Legal Matters. Except as set forth on Exhibit 5.01(d) annexed
hereto, there is no claim, legal action, counterclaim, suit, arbitration,
governmental investigation or other legal, administrative or tax proceeding,
nor any order, writ, injunction, decree or judgment (collectively, the "Legal
Matters"), in progress or pending, or to the knowledge of any Seller or
Partner, threatened, against or relating to any Seller or its businesses or
assets including the Businesses and the Purchased Assets, nor does any Seller
or Partner know or have reason to be aware of any basis for the same, which
would individually or in the aggregate have a material adverse effect on (i)
any Seller or any Seller's ownership of the Businesses or the Purchased Assets
or such Seller's ability to sell the Businesses or the Purchased Assets as
herein contemplated, (ii) the business or financial condition of any Seller, or
(iii) the transactions contemplated by this Agreement.
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(e) Accounts Receivable. The accounts receivable of each Seller
shown on its Operating Financial Statements arose in the ordinary course of
business, are owned by it free and clear of any Lien (other than Liens to be
released on or prior to the Closing Date) and have been collected or are
collectible in the normal course at the aggregate recorded amounts thereof,
subject to no valid counter claims or set-offs, less a reserve for
uncollectible items as set forth on Exhibit 5.01(e) annexed hereto. The
accounts receivable acquired by each Seller and shown on the Interim Financial
Statements or the Closing Date Balance Sheets, as the case may be, will have
arisen in the ordinary course of business, are or will be owned by it free and
clear of any Lien (other than Liens to be released on or prior to the Closing
Date) and have been collected or will be collectible in the normal course of
business at the aggregate recorded amounts thereof, less a reserve for
uncollectible items as set forth on Exhibit 5.01(e) annexed hereto. Such
percentage is based upon the historical collectibility of the accounts
receivable of each Seller and represents Sellers' good faith estimate of the
percentage of each Sellers' accounts receivable which will not be collectible
in the ordinary course of business.
(f) Compliance with Laws. Each Seller and each Partner is in
compliance with all applicable laws, regulations and administrative orders of
the United States and the states in which such Seller or Partner transacts
business (including all applicable rules and regulations of the FCC, any state
public utilities or public service commission, or any other Federal or state
governmental agency or instrumentality exercising jurisdiction over such Seller
or Partner or its properties or businesses), and of each municipality, county
or subdivision of any thereof, to which any of its businesses or any of its
properties may be subject, the non-compliance with which would have a material
adverse effect upon (i) any Seller's ownership of the Businesses or the
Purchased Assets or ability to sell the Businesses or the Purchased Assets as
herein contemplated, or (ii) any Seller, its financial condition or business,
or the transactions contemplated hereby.
(g) Environmental Matters. There has been no manufacture,
refining, storage, disposal or treatment of Hazardous Substances (as
hereinafter defined) by any Seller (or, to the knowledge of any Seller or
Partner, its predecessors in interest) at any real property currently or in the
past owned, operated, used, leased or contracted for by any Seller or otherwise
in violation of any Environmental Laws (as hereinafter defined) or which would
require remedial action under any Environmental Law; to the knowledge of any
Seller, none of the soil, ground water, or surface water of such real property
is contaminated by any Hazardous Substance. During the past five years none of
Sellers has received any (i) notice of any such violation with respect to any
Hazardous Substance at or by any of such real property, (ii) notice from any
governmental agency that it, or any present or former owner, lessee or operator
of such real property is a potentially responsible party for cleanup liability
with respect to the emission, discharge or release of any Hazardous Substance
or for any other matter arising under the Environmental Laws or in any
litigation, administrative proceeding, finding, order, citation, notice,
investigation or complaint under any Environmental Law, or (iii) notice of
violation, citation, complaint, request for information, order, directive,
compliance schedule, notice of claim, proceeding or litigation from any party
concerning the compliance of any Seller with any Environmental Law. To the
knowledge of any Seller, there are no incinerators, septic tanks or cesspools
located on such real property, all sewage is discharged into a public sanitary
sewer system (except that at certain switch sites Sellers contract with third
party providers for siting and servicing of portable sanitary toilet
Execution - 18 -
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facilities) and no Hazardous Substances are emitted, discharged or released,
directly or indirectly, by any Seller into the atmosphere or any body of water.
No permits, licenses or other authorizations issued pursuant to the
Environmental Laws are required for Buyer's ownership, use or occupancy of, or
any Seller's present ownership, use or occupancy of, such real property. As
used herein "Environmental Laws" means the Resource Conservation Recovery Act,
the Comprehensive Environmental Responsibility Compensation and Liability Act,
the Superfund Amendments and Reauthorization Act, the Toxic Substances Control
Act, the Hazardous Materials Transportation Act, the Clean Air Act, the Clean
Water Act, and other similar Federal and state laws, as amended, together with
all regulations issued or promulgated thereunder, relating to pollution, the
protection of the environment or the health and safety of workers or the
general public. As used herein "Hazardous Substance" means any hazardous
substance, hazardous or toxic waste, hazardous material, pollutant or
contaminant, as those or similar terms are used in the Environmental Laws,
including asbestos and asbestos-related products, chlorofluorocarbons, oils or
petroleum-derived compounds, polychlorinated biphenyls, pesticides and radon.
As used in this Section 5.01(g), the term "knowledge" refers to actual and not
constructive knowledge and is not intended to impose upon Sellers any duty to
investigate the condition of any real property other than in the ordinary
course of business and consistent with past practices.
(h) Authorizations.
(i) Each Seller has (A) all requisite franchises,
licenses, authorizations, consents, permits and approvals of the FCC and of all
state public utility or public service commissions and (B) all other material
franchises, licenses, authorizations, consents, permits and approvals of
governmental agencies exercising jurisdiction over such Seller or its
businesses or assets (all such franchises, licenses, authorizations, consents,
permits and approvals, as amended to the date hereof, are collectively referred
to as the "Authorizations"), required to carry on the Businesses of such
Sellers as now conducted or as contemplated to be conducted. All such
Authorizations are listed on Exhibit 5.01(h) annexed hereto.
(ii) The Authorizations are in full force and effect and
have not been suspended, modified in any material adverse respect, canceled or
revoked, and each Seller has operated in compliance with all terms thereof or
any renewals thereof applicable to it except where failure to so comply would
not have a material adverse effect on such Seller, its financial condition or
the Businesses or the Purchased Assets. No event has occurred with respect to
any of the Authorizations which permits, or after notice or lapse of time or
both would permit, revocation or termination thereof or would result in any
other material impairment of the rights of the holder of any such
Authorizations. Except as set forth on Exhibit 5.01(h) annexed hereto, there
is not pending as of the date hereof any application, petition, objection or
other pleading with the FCC or any public service commission or similar body
having jurisdiction or authority over the communications operations of any
Seller which questions the validity of or contests any Authorization or which
presents a substantial risk that, if accepted or granted, would result in the
revocation, cancellation, suspension or any materially adverse modification of
any Authorization.
(iii) Except as set forth on Exhibit 5.01(h) annexed
hereto, no permit, consent, approval, authorization, qualification or
registration of, or declaration to or filing with, any
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governmental or regulatory authority or agency is required to be obtained or
made by any Seller in connection with the execution and delivery of this
Agreement or with the consummation of the transactions contemplated hereby in
order to (A) render this Agreement and the transactions contemplated hereby
valid and effective and (B) enable Sellers to sell the Businesses and Purchased
Assets to Buyer as herein contemplated.
(i) Title of Sellers to Purchased Assets.
(i) Except as disclosed in Exhibit 5.01(i) annexed
hereto, each Seller has good and marketable title to all property owned
(including all property and assets, real and personal, included in the
Operating Financial Statements) and a good and valid leasehold interest in all
property leased by such Seller, free and clear of all Liens except for Liens
for taxes, assessments, governmental charges or levies which shall not at this
time be due and delinquent or which hereafter can be paid without penalty or
with respect to which such Seller is currently contesting the validity thereof
in good faith by appropriate proceedings and with respect to which it has
established adequate reserves, and except for warehousemen's, mechanics',
carriers', landlords', repairmen's, or other similar Liens arising in the
ordinary course of business, (none of which, either singly or in the aggregate,
is material). Exhibit 5.01(i) annexed hereto correctly identifies (A) each
parcel of real property owned by each Seller, (B) each lease by each Seller of
any real property and each space allocation arrangement with such Seller
covering any real or other material property used in such Seller's businesses,
and (C) each guaranty by any Seller of any such lease. Exhibit 5.01(i) annexed
hereto contains, with respect to each Seller, a list setting forth (1) the
location of all cell and switch sites and (2) the number of voice channels
installed and operational at each site.
(ii) All of the buildings and other material tangible
personal property owned or leased by each Seller are in good working condition
(normal wear and tear excepted), and are adequate and suitable for the purposes
for which they are presently being used. All such property is being operated
in conformity with applicable statutes, regulations, and ordinances, the
failure of which to so conform would have a material adverse effect on any
Seller, its financial condition or business or the transactions contemplated
hereby. All such assets are, in the aggregate, sufficient in all material
respects to continue operating the business of each Seller as has been
heretofore conducted.
(iii) Neither the whole nor any material portion of any
real property owned or leased by any Seller has been condemned, requisitioned
or otherwise taken by any public authority, and none of Sellers has actual
knowledge that any such condemnation, requisition or taking is threatened or
contemplated. None of the real or personal properties owned, leased or
operated by any Seller, or the ownership, occupancy or operation thereof, is in
violation in any material respect of any law or any building, zoning or other
ordinance, code, rule, regulation or requirement, and no notice from any
governmental body or other Person has been served upon any Seller claiming any
violation of any such law, ordinance, code, rule or regulation or requiring, or
calling attention to the need for, any work, repairs, construction, alterations
or installation on or in connection with said property which has not been
complied with.
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(j) Insurance. Exhibit 5.01(j) annexed hereto sets forth a list
and brief description of all policies of fire, liability and other forms of
insurance and material fidelity bonds held by each Seller. Each Seller's
assets, business, equipment, property and operations are adequately insured
against loss or damage and all other hazards or risks of the character usually
insured against by companies in the same or similar business and such insurance
shall be continued in full force and effect through 11:59 p.m. on the Closing
Date. Each such policy and fidelity bond referenced in such Exhibit 5.01(j)
annexed hereto is in full force and effect, all premiums due and payable under
such policies and fidelity bonds have been and on the Closing Date will be paid
in full, and there are no disputed claims arising under such policies or
fidelity bonds.
(k) Employees. Exhibit 5.01(k) annexed hereto contains a list
setting forth the name and current annual salary and other compensation payable
by each Seller to each Employee (as hereinafter defined), and the profit
sharing, bonus or other form of additional compensation paid or payable by each
Seller to or for the benefit of each Employee for the current fiscal year.
Except as set forth on Exhibit 5.01(k) annexed hereto or under the employment,
consulting or other agreements listed thereon, there are no oral or written
contracts, agreements or arrangements obligating any Seller to increase the
compensation or benefits presently being paid or hereafter payable to any of
its Employees. Exhibit 5.01(k) annexed hereto sets forth summaries of all oral
employment or consulting or similar arrangements between any Seller and any
Person which are not terminable without liability on thirty (30) days' or less
prior notice and lists all written employment and consulting agreements between
any Seller and any Employee, true and complete copies of which have been
provided to Buyer. Except for severance obligations to Employees of any Seller
set forth on Exhibit 5.01(k) annexed hereto, there is not due or owing and
there will not be due and owing at the Closing to any of Sellers' Employees,
any sick pay, severance pay (whether arising out of the termination of an
Employee of Sellers prior to, on, or subsequent to the Closing), compensable
time or pay, including salary, commission and bonuses, personal time or pay or
vacation time or vacation pay attributable to service rendered on or prior to
the Closing Date. Except as disclosed in the Exhibits annexed hereto, there is
not now, and there will not be as of the Closing Date, any liability of any
Seller arising out of claims made or suits brought (including workers'
compensation claims and claims or suits for contribution to, or indemnification
of, third parties, occupational health and safety, environmental, consumer
protection or equal employment matters) for injury, sickness, disease,
discrimination, death or termination of employment of any Employee, or other
employment matter to the extent attributable to an event occurring or a state
of facts existing on or prior to the Closing.
(l) Intellectual Property Rights. All of the patents, trademarks,
service marks, tradenames, trade secrets, copyrights, licenses and other
intellectual property rights material to the operation of any of the Businesses
or owned or held by any Seller are described on Exhibit 5.01(l) annexed hereto.
Except as set forth on Exhibit 5.01(l) annexed hereto, the conduct by each
Seller of its businesses does not to the knowledge of any Seller infringe upon
or violate any patents, trademarks, service marks, trade names, trade secrets,
copyrights, licenses or rights of anyone, and, except as set forth on Exhibit
5.01(l) annexed hereto, no claim is pending or threatened to the effect that
the conduct by any Seller of its businesses infringes upon or violates any
patents, trademarks, service marks, trade names, trade secrets, copyrights,
licenses or rights of anyone.
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(m) Indebtedness. Exhibit 5.01(m) annexed hereto lists generally
all indentures, trust deeds, loan agreements, or other instruments pursuant to
which any Seller has incurred Indebtedness or has guaranteed the Indebtedness
of any Person all of which shall be terminated and released with respect to
Sellers on or prior to the Closing Date. Other than as set forth in Exhibit
5.01(m) annexed hereto, no Seller is indebted to any Affiliate, shareholder,
director, officer, employee, agent or partner of any Seller or of any Affiliate
of any Seller and no Affiliate, shareholder, director, officer, employee, agent
or partner of any Seller or of any Affiliate of any Seller is indebted to any
Seller.
(n) Tax Matters. Each Seller has timely filed all Federal, state
and local Tax (as defined in Section 7.03(a)) returns and all information
returns and reports required to be filed by or with respect to it under the
laws of the United States or any state or other jurisdiction on or prior to the
date hereof and will timely file all such returns and reports required to be
filed from the date hereof through the Closing Date. True and complete copies
of such reports and returns filed on or before the date hereof have been or
will be furnished or made available to Buyer within thirty (30) days after the
date hereof and true and complete copies of all such returns and reports filed
after the date hereof and on or before the Closing Date will be furnished to
Buyer within five (5) days after they are filed. All such reports and returns
were or will be accurately prepared in accordance with all applicable statutes,
rules and regulations and are or will be correct as filed. None of Sellers is
or was an association taxable as a corporation for Federal, state or local tax
purposes. Each Seller has paid all Taxes (including Taxes for which such
Seller is a collection agent, e.g., withholding, excise, sales, use, Social
Security and similar Taxes) which have become due and payable (and will pay
prior to the Closing Date all Taxes which shall have become due and payable on
or prior to the Closing Date) with respect to such Seller for all taxable
periods ending on or prior to the Closing Date or will have set aside and
reflected on the Closing Date Balance Sheets adequate reserves therefor. No
Seller has ever been included in a consolidated Federal income tax return or
combined or unitary state tax return. No Seller is a party to nor has any
Seller been notified that it is the subject of any pending, proposed or
threatened action, investigation, proceeding, audit, claim or assessment by or
before the Internal Revenue Service or any other governmental authority and no
claim for assessment, deficiency or collection of Taxes, or proposed
assessment, deficiency or collection, for which any Seller may be liable, has
been asserted or threatened against it. No Seller has received any notice of
deficiency, assessment or collection or proposed deficiency, assessment or
collection from the Internal Revenue Service or any other governmental
authority which has not been satisfied, nor, except as set forth on Exhibit
5.01(n) annexed hereto, does any Seller have any reason to believe that any
such notice will be received in the future. The Internal Revenue Service has
never audited any Federal income tax return of any Seller. The charges,
accruals and reserves shown in the Operating Financial Statements of Sellers in
respect of Taxes for all fiscal periods to date are adequate. There are no
material unpaid assessments or proposals for additional Taxes for which any
Seller does not have adequate reserves, nor does any Seller know of any basis
therefor for any such period. There are no Tax rulings, requests for rulings
or closing agreements relating to any Seller which could affect its liability
for Taxes for any period after the Closing Date. Except as set forth on
Exhibit 5.01(n) annexed hereto (i) no power of attorney has been granted by any
Seller or any of its Affiliates with respect to any matter relating to Taxes of
Sellers which is currently in force, (ii) none of Sellers has filed any
agreement with the Internal Revenue Service described in Section
1.1503-2A(c)(3) of the Treasury Regulations, (iii) none of Sellers has filed a
consent or
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made any agreement with the Internal Revenue Service under Section 341(f) of
the Internal Revenue Code of 1986, as amended (the "Code"), or any comparable
provision of state revenue statutes, and (iv) no Seller and none of the
partners of any Seller which is a partnership is a "foreign person" within the
meaning of Section 1445(f)(3) of the Code. No Seller has executed or filed
with the Internal Revenue Service or any other governmental authority any
agreement which is still in effect waiving or extending the period for
assessment or collection of any Taxes. Sellers, and not Buyer, shall be liable
for any Taxes, payable by Buyer or Sellers by reason of the ownership of the
Businesses or the Purchased Assets on or prior to the Closing Date, the conduct
of Sellers' Businesses with respect to all periods ending on or prior to the
Closing Date or payable by any Seller by reason of the sale of the Businesses
and the Purchased Assets.
(o) Employee Benefit Plans.
(i) Generally. Exhibit 5.01(o) annexed hereto contains a
true and complete list of each plan, program, policy, practice, contract,
agreement or other arrangement providing for compensation, severance,
termination pay, performance awards, stock or stock-related awards or other
equity based awards, fringe benefits or other employee benefits of any kind,
whether formal or informal, proposed or final, funded or unfunded and whether
or not legally binding, including each "employee benefit plan" within the
meaning of Section 3(3) of the Employee Retirement Income Security Act of 1974,
as amended ("ERISA") which is now, or ever has been, maintained, contributed
to, or required to be contributed to, for the benefit of any current or former
employee, independent contractor, agent or consultant of any Seller or engaged
in the Businesses ("Employee"), or any current or former employee, independent
contractor, agent or consultant of any entity required to be aggregated with
any Seller pursuant to Section 414(b), (c), (m), or (o) of the Code and each
management, employment, severance or consulting agreement or contract between
any Seller or any of its Affiliates and any Employee for which any Seller may
have liability or between any Seller and any Employee ("Employee Plan"). Each
Seller will provide to Buyer prior to the Closing true and complete copies of
all documents, if any, embodying each Employee Plan, including all amendments
thereto and written interpretations thereof; the three most recent annual
reports filed (Form 5500 Series with applicable schedules) with respect to each
Employee Plan required under ERISA; and the most recent summary plan
description, if any, with respect to each Employee Plan required under ERISA.
(ii) Compliance. Each Seller has performed in all
material respects all obligations required to be performed by it under each
Employee Plan and each Employee Plan has been established and maintained in all
material respects in accordance with its terms and in compliance with all
applicable laws, statutes, orders, rules and regulations, including ERISA or
the Code. No Employee Plan that is an employee pension benefit plan within the
meaning of Section 3(2) of ERISA is subject to Title IV of ERISA or is a
multiemployer plan within the meaning of Section 3(37) of ERISA, and none of
Sellers has any liability with respect to any such plan as a result of having
been part of a "controlled group" within the meaning of Section 414(b), (c),
(m), and (o) of the Code, nor is there any basis for such liability being
imposed. There are no investigations, proceedings, actions, suits or claims
pending, or, to the best knowledge of any Seller, threatened or anticipated
(other than routine claims for benefits) against any Employee Plan or the
assets of any Employee Plan; each Employee Plan can be amended, terminated, or
otherwise
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discontinued on or after the Closing in accordance with its terms, without
liability to Sellers, Buyer or any of Buyer's Affiliates; all premiums required
by any Employee Plan have been paid thereunder; all outstanding indebtedness
for services performed for any Seller or accrued vacation, holiday pay, earned
commissions, accrued bonuses or other benefits owed to any Employee has been
paid when due or accrued on the books of such Seller; all contributions due to
and payments from, the Employee Plans that may have been required to be made
have been made; no "prohibited transaction" within the meaning of Section 4975
of the Code or Section 406 of ERISA for which a statutory, administrative or
regulatory exemption is not available has occurred with respect to any Employee
Plan; and no action or failure to act with respect to any Employee Plan will
subject any Seller, Buyer or any of Buyer's Affiliates to any tax or penalty or
other liability.
Except as listed on Exhibit 5.01(o) annexed hereto, each
Employee Plan that is intended to be qualified under the Code has received a
determination letter from the Internal Revenue Service to the effect that such
Employee Plan and related trust are qualified and exempt from Federal income
taxes under Sections 401(a) and 501(a), respectively; such determination letter
includes any new or modified requirements under the Tax Reform Act of 1986 and
subsequent legislation enacted thereafter; and no such determination letter has
been revoked, nor to the knowledge of Seller, has revocation been threatened.
To Seller's knowledge, nothing has occurred or is expected to occur that would
adversely affect the qualified status of any Plan or any related trust
subsequent to the issuance of such determination letter.
(iii) No Post-Employment Obligations. No Seller maintains
or contributes to any Employee Plan which provides, or has any liability to
provide, life insurance, medical or other employee welfare benefits (other than
severance and accrued vacation and holiday pay) to any Employee upon his
retirement or termination of employment, except as may be required by Federal
or state statute and no Seller has ever represented, promised, or contracted
(orally or in writing) to any Employee (individually or as a group) that life
insurance, medical or other employee welfare benefits (other than severance and
accrued vacation and holiday pay) would be provided upon their retirement or
termination of employment, except to the extent required by Federal or state
statute.
(iv) COBRA. Each "group health plan" within the meaning
of Section 4980B(g)(2) of the Code maintained by any Seller or any entity with
which it is considered a "single employer" within the meaning of Section
414(b), (c), (m) and (o) of the Code, has been administered in good faith in
compliance with the continuation coverage requirements contained in the
Consolidated Omnibus Budget Reconciliation Act of 1985, as amended ("COBRA"),
as set forth at Section 4980B of the Code and any regulations promulgated or
proposed (if such proposed regulations constitute substantial authority within
the meaning of Section 6662 of the Code and any regulations promulgated
thereunder) thereunder.
(v) Effect of Transaction. Except as set forth on
Exhibit 5.01(o)(v) annexed hereto, the execution of this Agreement and the
consummation of the transactions contemplated hereby will not (either alone or
when taken together with any additional or subsequent events) constitute an
event under any Employee Plan that will or may result in any payment, upon a
change in control or otherwise, whether of severance, accrued vacations or
otherwise, acceleration, vesting, distribution, increase in benefits or
obligation to fund benefits with respect to any Employee. No
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payment or benefit which will or may be made by any Seller with respect to any
Employee as a result of the transactions contemplated hereby will be
characterized as an "excess parachute payment" within the meaning of Section
280G(b)(1) of the Code.
(vi) Employment Matters. Each Seller (A) is in compliance
with all applicable Federal and state laws, rules and regulations respecting
employment, employment practices, terms and conditions of employment and wages
and hours, in each case, with respect to Employees, except where the failure to
be in compliance would not, singly or in the aggregate, have a material adverse
effect on any Seller, its financial condition or business; (B) has withheld all
amounts required by law or by agreement to be withheld from the wages, salaries
and other payments to Employees; (C) is not liable for any arrears of wages or
any taxes or any penalty for failure to comply with any of the foregoing,
except as would not have a material adverse effect on such Seller, its
financial condition or business; and (D) (other than routine payments to be
made in the normal course of business and consistent with past practice) is not
liable for any payment to any trust or other fund or to any governmental or
administrative authority, with respect to unemployment compensation benefits,
Social Security or other benefits for Employees.
(vii) Labor. No work stoppage or labor strike with respect
to Employees or against any Seller is pending or, to the best knowledge of any
Seller or any Partner, threatened. Except as set forth on Exhibit 5.01(o)(vii)
annexed hereto, no Seller is involved in or, to the best knowledge of any
Seller, threatened with, any labor dispute, grievance or litigation relating to
labor, safety or discrimination matters involving any Employee including
charges of unfair labor practices or discrimination complaints, which, if
adversely determined, would, individually or in the aggregate, have a material
adverse effect on such Seller, its financial condition or business. No Seller
has engaged in any unfair labor practices within the meaning of the National
Labor Relations Act which would, individually or in the aggregate, have a
material adverse effect on such Seller, its financial condition or business.
(viii) No Seller is presently or has been in the past a
party to, or bound by, any collective bargaining agreement or union contract
with respect to Employees and no collective bargaining agreement is at the date
hereof being negotiated by or on behalf of any Seller.
(p) Contracts.
(i) Exhibit 5.01(p) annexed hereto contains a list of all
Contracts (other than subscriber agreements and agreements having an annual
cost of less than $5,000 for any single agreement and $50,000 for all such
agreements) to which any Seller is a party and which in any way relate to the
operations or properties of any Seller or which will be binding upon Buyer, its
operations or properties (including the Businesses or the Purchased Assets)
after the Closing Date. As used herein "Contracts" means all leases, rental
agreements, insurance policies, collective bargaining agreements, union
contracts, licenses, agreements, permits, purchase orders, sales orders,
agreements with suppliers, reseller agreements, agreements with agents,
agreements with customers, commitments and any and all other contracts,
consents or binding arrangements or understandings (including capital
commitments and arrangements with respect to construction in progress), whether
written or oral, express or implied, to which any Seller is a party and which
in
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any way relate to the operations of the Businesses or the Purchased Assets of
any Seller or which will be binding upon Buyer, its operations or properties
(including the Businesses or the Purchased Assets) after the Closing Date.
Except for (i) the Contracts listed on Exhibit 5.01(p) annexed hereto (true and
complete copies of which agreements have been previously delivered to Buyer or,
in the case of oral agreements, descriptions of which are set forth on said
Exhibit 5.01(p)), (ii) subscriber agreements and agreements having an annual
cost of less than $5,000 for any single agreement and $50,000 for all such
agreements and (iii) Contracts entered into between the date hereof and the
Closing Date as permitted by Section 4.01(c) hereof, none of Sellers is a party
to nor is it or any of its property bound by any Contract.
(ii) Each Seller has performed and will perform in all
material respects all obligations required to be performed by it under all
Contracts, and will in all material respects perform all obligations required
to be performed by it under Contracts entered into after the date hereof as
permitted by Section 4.01(c) hereof; none of Sellers nor, to the best of any
Seller's or any Partner's knowledge, any party with whom any Seller has an
agreement is in material default under any Contract, and no event exists which
with the giving of notice or the passage of time, or both, would create such a
default; and no Seller knows of a meritorious basis for any claim of any such
default.
(iii) Each of the Contracts has been, and each Contract
entered into after the date hereof as permitted by Section 4.01(c) hereof will
be, lawfully entered into and is or will be valid and in full force and effect
and is or will be enforceable in accordance with its terms for the period
stated in such Contract. There are no currently threatened cancellations of,
nor are there any outstanding disputes under, any Contracts. No Seller will
modify, amend or waive any provisions of any Contract in a manner that would
materially adversely affect the Businesses, the Purchased Assets or, financial
condition of Buyer after the Closing Date, or terminate any Contract prior to
the Closing without the prior written consent of Buyer, which consent will not
be unreasonably withheld.
(iv) Except as set forth on Exhibit 5.01(b) annexed
hereto, the consummation of the transactions contemplated by this Agreement
does not require any consent under any Contract listed on Exhibit 5.01(p)
annexed hereto, and the consummation of the transactions contemplated by this
Agreement will not require any consent under any Contract (which will survive
the Closing) entered into after the date hereof as permitted by Section 4.01(c)
hereof, in each case which will not have been obtained by the Closing (and
copies of such consents will be given to Buyer on or prior to the Closing
Date), and such consummation will not result in the termination of any right or
privilege under any Contract listed on Exhibit 5.01(p) annexed hereto or any
other Contract (which will survive the Closing) entered into after the date
hereof as permitted by Section 4.01(c) hereof; provided, however, that Sellers
shall not be deemed to be in default of any of their obligations under this
Agreement by reason of the failure to obtain any such individual consent so
long as the failure to obtain any such consent would not individually or
together with all such other failures to obtain consents have a material
adverse effect on the Businesses, the Purchased Assets or their ownership or
operation by Buyer or the consummation of the transactions contemplated hereby.
No Seller has received notice that any party to any Contract listed on Exhibit
5.01(p) annexed hereto intends to cancel such Contract nor has any party given
any Seller notice of any alleged
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breach of any Contract or of its intent to take any legal action in order to
enforce its rights thereunder. All liabilities and obligations of any Seller
which are due and payable or which are to be performed on or before the Closing
Date under such Contracts have been, or will have been on the Closing Date,
duly paid in full or performed in all material respects.
(v) Exhibit 5.01(p) annexed hereto contains true and
complete copies of all forms of subscriber agreements used by any Seller.
(vi) No Seller has any Contracts with any Person (or group
of Affiliated Persons) which cover more than 2% of such Seller's wireless
telephone subscribers.
(vii) Each of the agreements between any Seller and its
agents or dealers, including those entered into between the date hereof and the
Closing Date as permitted by Section 4.01(c) hereof, contains or will at the
Closing Date contain a provision permitting such Seller, in its sole
discretion, to change the amount and rate of the fees or other consideration to
be paid to such agent or dealer upon ninety (90) days or less written notice by
such Seller to such agent or dealer.
(q) No Sale. No Seller has entered into any contract to sell,
mortgage or encumber any of its material assets.
(r) No Material Adverse Change. Since the date of the most recent
Operating Financial Statements, there has not been
(i) any material adverse change in the rate of any
Seller's generation of cash flow from operations, as opposed to cash flow from
financing operations and investment activities, after giving effect to
customary seasonal fluctuations of cash flow generation and after giving effect
to agents' commissions and other marketing expenses incurred in the ordinary
course of business consistent with past practices;
(ii) any incurrence, assumption or guarantee by any of
Sellers of Indebtedness other than pursuant to Contracts in existence on the
date hereof and set forth or described in Exhibit 5.01(p) annexed hereto or as
permitted pursuant to Section 4.01(c) hereof;
(iii) any creation by any of Sellers of any Lien on any of
the Purchased Assets other than pursuant to Contracts in existence on the date
hereof and set forth or described in Exhibit 5.01(p) annexed hereto or as
permitted pursuant to Section 4.01(c) hereof, each of which Liens will be
terminated and released on or prior to the Closing Date;
(iv) any making of any loan, advance or capital
contribution to or investment in any Person by any Seller other than as
permitted pursuant to Section 4.01(c) hereof;
(v) any damage, destruction or other casualty loss
affecting the Business or the Purchased Assets of any Seller which, after
giving effect to payments to such Seller under applicable insurance policies,
has had or is likely to have a material adverse effect on such Seller, its
financial condition or business;
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(vi) any repurchase, redemption or other acquisition by
Sellers of any outstanding interest in Sellers;
(vii) any change by any Seller in accounting principles or
methods; or
(viii) any other action taken by any Seller which, without
the prior written consent of Buyer, would not be permitted pursuant to Section
4.01(c) hereof.
(s) Equipment. Except for that being replaced as set forth on
Exhibit 4.01(q) annexed hereto, substantially all of Sellers' (i) wireless
telephone equipment, including system equipment, switch, cell site and test
equipment, (ii) mobile telephone equipment in inventory, and (iii) equipment
and software relating to any of Sellers' billing systems are in good working
condition and are suitable for the use for which they are intended.
(t) Transactions with Affiliates. No Seller nor any Affiliate of
any Seller, nor any shareholder, officer, director, partner, member, consultant
or employee of any thereof, is at the date hereof a party to any transaction
with any Seller which would survive the Closing Date, including any contract or
arrangement providing for the furnishing of services to or by, providing for
rental of real or personal property (including intellectual property) to or
from, or otherwise requiring payments to or from, any such Seller or Affiliate.
(u) No Other Business; No Subsidiaries. No Seller has conducted
any business other than the business of owning and operating wireless
telephone companies. No Seller has any subsidiaries nor is any Seller a partner
in any other partnership or joint venture, nor does any Seller own any equity
interest in any other entity.
(v) Investment Company Act. No Seller is an "investment company"
within the meaning of the Investment Company Act of 1940, as amended.
(w) Truth and Correctness. No representation or warranty by any
Seller or Partner herein, nor any written statement or certificate or other
instrument furnished to Buyer by any Seller or Partner pursuant hereto or in
connection with the transactions contemplated hereby, including the Exhibits
annexed hereto, contains any untrue statement of a material fact or omits or
will omit to state a material fact necessary to make the statements contained
herein or therein, in light of the circumstances under which such statements
are made, not misleading.
5.02 Buyer's Representations and Warranties. Buyer represents and
warrants to Sellers as follows:
(a) Due Incorporation. Buyer is a corporation duly organized,
validly existing and in good standing under the laws of the State of Washington
and has all requisite corporate power and authority to enter into this
Agreement and to perform its obligations hereunder.
(b) Authority. This Agreement and all transactions contemplated
hereby have been duly and validly authorized by all necessary corporate action
on the part of Buyer and this Agreement constitutes a legal, valid and binding
obligation of Buyer enforceable in accordance
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with its terms except as such enforceability may be limited by bankruptcy,
insolvency, moratorium or other similar laws affecting or relating to
enforcement of creditors' rights generally. Neither the execution, delivery or
performance of this Agreement nor the consummation of the transactions
contemplated hereby by Buyer will, with or without the giving of notice or the
passage of time, or both, conflict with, result in a default or loss of rights
(or give rise to any right of termination, cancellation or acceleration) under,
or result in the creation of any Lien, pursuant to (i) any provision of the
certificate of incorporation or by-laws of Buyer; (ii) any material note, bond,
indenture, mortgage, deed of trust, contract, agreement, lease or other
instrument or obligation to which Buyer is a party or by which it or its
property is bound or affected; or (iii) any law, order, judgment, ordinance,
rule, regulation or decree to which Buyer is a party or by which it or its
property is bound or affected. Except as described on Exhibit 5.02(b) annexed
hereto, no permit, consent, approval, authorization, qualification or
registration of, or declaration to or filing with any governmental or
regulatory authority or agency or third party is required to be obtained or
made by Buyer in connection with the execution and delivery of this Agreement
or the consummation of the transactions contemplated hereby in order to (A)
render this Agreement or the transactions contemplated hereby valid and
effective and (B) enable Buyer to purchase the Businesses and the Purchased
Assets as herein contemplated.
(c) Legal Matters. There is no claim, legal action, counterclaim,
suit, arbitration, governmental investigation or other legal, administrative or
tax proceeding, nor any order, decree or judgment, in progress or pending, or
to the knowledge of Buyer threatened, against or relating to Buyer's right to
perform its obligations under this Agreement, nor does Buyer know or have
reason to be aware of any basis for the same. There is outstanding no order,
writ, injunction, judgment or decree of any court, governmental agency or
arbitration tribunal which would individually or in the aggregate have a
material adverse effect on Buyer's obligations hereunder or the transactions
contemplated by this Agreement other than orders or decrees involving the
wireless telephone industry in general.
(d) Truth and Correctness. No representation or warranty by
Buyer, or any written statement or certificate or other instrument furnished to
Sellers by Buyer pursuant hereto or in connection with the transactions
contemplated hereby, contains or will contain any untrue statement of a
material fact or omits or will omit to state a material fact necessary to make
the statements contained herein or therein, in light of the circumstances under
which such statements are made, not misleading.
5.03 No Brokers. Buyer represents and warrants to Sellers and the
Partners that no agent, broker, investment banker, Person or firm is or will
be entitled to any broker's or finder's fee or any other commission or similar
fee directly or indirectly in connection with the transactions contemplated by
this Agreement based in any way on any arrangements, agreements or
understandings made by or on behalf of Buyer, and Buyer hereby agrees to
indemnify Sellers and the Partners and agrees to hold harmless Sellers against
and in respect of any claims for brokerage and other commissions relating to
such transactions based in any way on any arrangements, agreements or
understandings made by or on behalf of Buyer. Sellers and the Partners
represent and warrant, jointly and severally, to Buyer that, except for
Columbia Capital Corporation, no agent, broker, investment banker, Person or
firm is or will be entitled to any broker's or finder's fee
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or any other commission or similar fee directly or indirectly in connection
with the transactions contemplated by this Agreement based in any way on any
arrangements, agreements or understandings made by or on behalf of Sellers and
the Partners and Sellers and the Partners hereby agree, jointly and severally,
to indemnify Buyer and agree, jointly and severally, to hold harmless Buyer
against and in respect of any claims for brokerage and other commissions
relating to such transactions based in any way on any arrangements, agreements
or understandings made by or on behalf of any Seller and the Partners,
including those with Columbia Capital Corporation.
ARTICLE 6
CONDITIONS TO OBLIGATIONS
6.01. Conditions to Buyer's Obligation. The obligation of Buyer to
perform, fulfill or carry out its agreements, undertakings and obligations
herein made or expressed to be performed, fulfilled or carried out on the
Closing Date is and shall be subject to fulfillment of or compliance with, on
or prior to the Closing Date, the following conditions precedent, any of which
may be waived by Buyer, in its sole discretion, in whole or in part:
(a) Each of the representations and warranties of each Seller and
each Partner contained in this Agreement shall be deemed to have been made
again at and as of the time of the Closing and shall then be true in all
material respects except for changes contemplated by this Agreement. Each
Seller and each Partner shall have performed and complied in all material
respects, with all agreements, covenants and conditions required by this
Agreement to be performed or complied with by each of them prior to or at the
Closing. Buyer shall have been furnished with a certificate of each Seller and
each Partner signed by its Chairman, President, Vice Chairman or general
partner, as the case may be, dated the Closing Date, certifying to the
fulfillment of the foregoing conditions by such Seller or such Partner and to
the truth and correctness in all material respects, except for changes
contemplated by this Agreement, as of the Closing Date, of the representations
and warranties of such Seller or Partner contained herein.
(b) There shall not then be pending by any third party any suit or
proceeding to restrain or invalidate, in whole or in part, this Agreement or
the transactions herein contemplated.
(c) Buyer shall have been furnished with an opinion of Xxxxxxx &
Xxxxxx, counsel for Sellers and Partners, dated the Closing Date, substantially
in the form of Exhibit 6.01(c) annexed hereto.
(d) Buyer shall have been furnished with an opinion of Paul,
Hastings, Xxxxxxxx & Xxxxxx LLP, FCC counsel for Sellers, dated the Closing
Date, substantially in the form of Exhibit 6.01(d) annexed hereto.
(e) The waiting periods, if applicable, of the HSR Act shall have
expired or been terminated.
(f) All consents, approvals and actions of third parties including
all approvals from Federal, state and local authorities (including the FCC and
all public service commissions and
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public utility commissions or comparable bodies exercising jurisdiction over
Sellers) as may be required for the valid assignment and transfer to Buyer, as
of the Closing Date, of all right, title and interest in and to the Businesses
and the Purchased Assets, shall have been obtained or made pursuant to a Final
Order, which consents and approvals shall not contain any conditions or
restrictions which, in the case of FCC approvals, are not customary in
transactions of this nature, and which in the case of third party consents and
approvals, materially adversely affect any Seller or its business or financial
condition, or the value of the Businesses or the Purchased Assets, or the
consummation of the transactions contemplated hereby. "Final Order" means an
action or decision as to which: (i) no request for a stay is pending, no stay
is in effect, and any deadline for filing such request that may be designated
by statute or regulation has passed; (ii) no petition for rehearing or
reconsideration or application for review is pending and the time for filing
any such petition or application has passed; (iii) the FCC or public utility
commission, public service commission (or comparable bodies exercising
jurisdiction over any of Sellers or the Businesses) does not have the action or
decision under reconsideration on its own motion and the time for initiating
such reconsideration has passed; and (iv) no appeal is pending or in effect and
any deadline for filing any such appeal that may be designated by statute or
rule has passed. Notwithstanding anything to the contrary herein contained, it
shall not be a condition to Buyer's obligations under this Agreement for
Sellers to obtain each individual required consent (other than any consents of
the FCC, any public utility or public service commission (or comparable bodies
exercising jurisdiction over any of Sellers or the Businesses)) so long as the
failure to obtain any such individual consent would not individually or
together with all such other failures to obtain consents have a material
adverse effect on the Businesses, the Purchased Assets or their ownership or
operation by Buyer or the consummation of the transactions contemplated hereby.
(g) Sellers shall have delivered to Buyer such deeds, bills of
sale and other good and sufficient instruments of conveyance, transfer and
assignment, all in form and substance reasonably satisfactory to Buyer's
counsel, as shall be effective to vest in Buyer good and marketable title in
and to the Businesses and the Purchased Assets, free and clear of any Liens,
restrictions on transfer and rights of first refusal.
(h) Each Seller shall deliver to Buyer (i) if such Seller is a
corporation (A) copies of its certificate of incorporation certified by the
Secretary of State of the jurisdiction of its incorporation, (B) copies of its
by-laws certified by its secretary, and (C) certificates of good standing of
recent date from the jurisdiction of its incorporation and all jurisdictions in
which it is qualified to do business; (ii) if such Seller is a partnership, (A)
a copy of its partnership agreement certified by its general partner (other
than portions thereof which disclose the relative economic interests of the
partners thereof) and (B) certificates of good standing from the jurisdiction
of its organization and all jurisdictions in which it is qualified to do
business; and (iii) a lien and judgment search in the offices of the
Secretaries of State of the states of Colorado, Kansas, Minnesota, New Mexico,
Oklahoma, Texas and Utah and in the office of the county clerk of the
appropriate counties therein, dated not earlier than fifteen (15) Business Days
prior to the Closing Date, the results of which are consistent with the
representations of Sellers contained herein.
(i) Each Seller and each Partner, for itself and its Affiliates,
officers, directors and shareholders shall have delivered to Buyer
documentation (including a general release) in form
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reasonably satisfactory to Buyer evidencing the release and discharge of any
and all claims which it or its Affiliates, officers, directors and shareholders
may have against the Businesses or the Purchased Assets.
(j) Each Seller shall have delivered to Buyer a certified copy of
the resolution or resolutions duly adopted by its board of directors (and
shareholders if required) or general partner (and the consents of its partners
if required pursuant to its partnership agreement or other governing documents
or under the Delaware Revised Uniform Limited Partnership Act, as amended)
authorizing the execution, delivery and performance of this Agreement.
(k) No statute, rule or regulation shall have been enacted by any
state or Federal government or governmental agency in the United States which
would render the consummation of this Agreement unlawful.
(l) Each Seller shall have delivered to Buyer an affidavit
certifying as to such Seller's non-foreign status in accordance with Section
1445(b)(2) of the Code.
(m) The transactions contemplated by the Agreement and Plan of
Merger of even date herewith, among Buyer, Triad Cellular L.P., Minnesota
Cellular Corporation, Triad Investment Minnesota, Inc., Xxxxx X. Xxxxx, Xxxxx
Xxxxxxx, Xxxxx X. Xxxxxx, Triad Cellular Corporation ("TCC") and Triad
Minnesota L.P. (the "Merger Agreement") shall have been consummated, or shall
be consummated concurrently herewith, in accordance with the terms of such
Merger Agreement; provided, however, if the Merger Agreement shall have been
terminated by reason of a Stockholder's Failure (as defined in the Merger
Agreement), the consummation of the transactions contemplated by the Merger
Agreement shall not be a condition to the consummation of the transactions
contemplated hereby.
6.02. Conditions to Sellers' Obligation. The obligation of Sellers
to perform, fulfill or carry out their agreements, undertakings and obligations
herein made or expressed to be performed, fulfilled or carried out on the
Closing Date is and shall be subject to fulfillment of or compliance with, on
or prior to the Closing Date, the following conditions precedent, any of which
may be waived by Sellers, in their sole discretion, in whole or in part:
(a) Each of Buyer's representations and warranties contained in
this Agreement shall be deemed to have been made again at and as of the time of
the Closing and shall then be true in all material respects, except for changes
contemplated by this Agreement. Buyer shall have performed and complied in all
material respects with all agreements, covenants and conditions required by
this Agreement to be performed or complied with by Buyer prior to or at the
Closing. Sellers shall have been furnished with a certificate of Buyer's Chief
Executive Officer, Vice Chairman or Senior Vice President, dated the Closing
Date, certifying to the fulfillment of the foregoing conditions by Buyer and to
the truth and correctness in all material respects, except for changes
contemplated by this Agreement, as of the Closing Date, of the representations
and warranties of Buyer contained herein.
(b) There shall not then be pending by any third party any suit or
proceeding to restrain or invalidate this Agreement or the transactions
contemplated hereby; provided, however, if Buyer desires to close
notwithstanding any such suit or proceeding and agrees to indemnify and hold
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harmless Sellers from any damages, losses, liabilities and expenses (including
reasonable attorneys' fees and expenses) incurred by Sellers as a result of
such suit or proceeding, then Sellers shall nevertheless be obligated to
consummate the transactions contemplated hereby.
(c) Buyer shall have delivered to Sellers on the Closing Date the
Purchase Price as provided in Section 3.01(a) hereof.
(d) All consents, approvals and actions of third parties,
including all approvals from Federal, state and local authorities (including
the FCC and all public service commission and public utilities commission or
comparable bodies exercising jurisdiction over Sellers) as may be required for
the valid assignment and transfer by Sellers to Buyer of the Businesses and the
Purchased Assets shall have been obtained; provided, however, that such
consents, approvals and actions need not be Final Orders.
(e) Sellers shall have been furnished with an opinion of Xxxxx
Xxxx Xxxxx Constant & Xxxxxxxx, counsel for Buyer, dated the Closing Date,
substantially in the form of Exhibit 6.02(e) annexed hereto.
(f) Sellers shall have been furnished with a certified copy of the
resolution or resolutions duly adopted by the board of directors of Buyer
authorizing the execution, delivery and performance of this Agreement.
(g) No statute, rule or regulation shall have been enacted by any
state or Federal government or governmental agency in the United States which
would render the consummation of this Agreement unlawful.
(h) The waiting periods, if applicable, of the HSR Act shall have
expired or been terminated.
(i) The transactions contemplated by the Merger Agreement shall
have been consummated, or shall be consummated concurrently herewith, in
accordance with the terms of such agreement; provided, however, if the Merger
Agreement shall have been terminated by reason of a Stockholder's Failure (as
defined in the Merger Agreement), the consummation of the transactions
contemplated by the Merger Agreement shall not be a condition to the
consummation of the transactions contemplated hereby.
ARTICLE 7
SURVIVAL; INDEMNITY
7.01. Survival of Representations and Warranties. Notwithstanding any
investigation or review made at any time by or on behalf of any party hereto,
all representations and warranties contained in this Agreement or in the
Exhibits annexed hereto or in any of the agreements, certificates or
instruments delivered in connection herewith (other than the representations
and warranties contained in Section 5.01(i) (the "Title Representations"),
Section 5.01(h) and the first two sentences of Section 5.01(b) and the first
sentence of Section 5.02(b) (the "Authorization
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Representations"), Section 5.01(n) (the "Tax Representations"), Sections
5.01(o) and 5.01(k) (the "Employee Representations") and 5.01(g) (the
"Environmental Representations")) shall survive the Closing for a period of one
(1) year and one hundred and eighty (180) days after the Closing Date (the
"Indemnification Period") and shall thereupon expire together with any right to
indemnification (except with respect to any claim for breach of any such
representation or warranty for which written notice shall have been given prior
to the termination of the Indemnification Period to the party which made such
representation or warranty). The Environmental Representations shall survive
the Closing for a period of three (3) years after the Closing Date and the
Title Representations, the Authorization Representations, the Tax
Representations and the Employee Representations and the liabilities and
obligations of Sellers under Sections 3.05 and 7.03 hereof and under Article 8
hereof shall survive the Closing until the expiration of any applicable
statutes of limitation (such three (3) year period being the Indemnification
Period with respect to the Environmental Representations and such statutes of
limitations period being the Indemnification Period with respect to the Title
Representations, the Authorizations Representations, the Tax Representations
and the Employee Representations and the liabilities and obligations of Sellers
under Sections 3.05 and 7.03 hereof and under Article 8 hereof).
7.02. Sellers' and Partners' Indemnity.
(a) During the Indemnification Period (or thereafter solely with
respect to any claim for indemnification for which notice has been given prior
to the expiration of the Indemnification Period), in addition to any other
indemnification provided for under this Agreement, each Seller and each Partner
shall jointly and severally indemnify and hold harmless Buyer and its
Affiliates from and against any and all demands, claims, losses, liabilities,
actions or causes of action, assessments, actual damages (but excluding
consequential damages), fines, Taxes (including excise and penalty taxes),
penalties, costs and expenses (including interest, expenses of investigation,
reasonable fees and disbursements of counsel, accountants and other experts
(whether such reasonable fees and disbursements of counsel, accountants and
other experts relate to claims, actions or causes of action asserted by Buyer
against Sellers or asserted by third parties)) (collectively "Losses") incurred
or suffered by Buyer and its Affiliates and their respective officers,
directors, employees, shareholders, agents and representatives arising out of,
resulting from, or relating to:
(i) any breach of any of the representations or
warranties made by any Seller or any Partner in this Agreement or in any
agreement, certificate, Exhibit or other instrument delivered by any Seller or
any Partner pursuant to this Agreement;
(ii) any failure by any Seller or any Partner to perform
any of its covenants or agreements contained in this Agreement or in any
agreement, certificate, Exhibit or other instrument delivered by any Seller or
any Partner pursuant to this Agreement;
(iii) any and all liabilities of Sellers other than those
expressly assumed by Buyer pursuant to Section 3.04 hereof;
(iv) any liabilities arising out of, resulting from or
relating to the liabilities of Sellers, or any other member of any affiliated
group or "controlled group," within the meaning of
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Section 414(b), (c), (m) and (o) of the Code, of which any Seller was a member
on or prior to the Closing Date which liability exists by reason of such Seller
having been a member of such affiliated or controlled group, including
liabilities relating to (A) the funding, operation, maintenance,
administration, amendment or termination of, or the withdrawal or partial
withdrawal from, any employee plan relating to any period on or prior to the
Closing and including losses arising under Title IV of ERISA, Section 302 of
ERISA, Section 412 or 4971 of the Code, (B) compliance with COBRA under Section
4980B of the Code, and (C) environmental matters with respect to any operations
of, or properties owned, occupied or operated or formerly owned, leased or
operated by, any Seller or any other member of an affiliated group or
"controlled group" of which any Seller was a member prior to the Closing Date;
(v) Any failure by Buyer or any of Sellers to comply with
the provisions of any Bulk Sales laws of the uniform commercial code as in
effect in any state having jurisdiction over Sellers or the transactions
contemplated hereby.
(b) Notwithstanding anything to the contrary contained in Section
7.02(a), Sellers and Partners shall not be required to pay or reimburse Buyer
or its Affiliates, for Losses pursuant to Sellers' and Partners' joint and
several indemnification obligation pursuant to Section 7.02 which (when
aggregated with any Losses paid to Buyer, or Buyer's Affiliates, by Seller or
Seller's Affiliates pursuant to Article 7 of (i) the Merger Agreement, (ii) the
Agreement, of even date herewith, between Buyer and TCC with respect to the
acquisition by Buyer of rights to certain D and E Block PCS licenses, and (iii)
the Agreement, of even date herewith, between Buyer and TCLP with respect to
the acquisition by Buyer of the Texas 1 RSA; the Agreements referred to in
clauses (i), (ii) and (iii) above being referred to as the "Concurrent
Agreements") are in excess of One Hundred Million ($100,000,000) Dollars.
(c) Notwithstanding anything to the contrary contained in this
Section 7.02, neither Buyer nor its Affiliates shall be entitled to seek
indemnification under Section 7.02(a) for any Losses unless the aggregate
amount of Buyer's or its Affiliates' Losses in respect of all such matters,
when aggregated with the aggregate amount of Buyer's or its Affiliates' Losses
(as such terms are defined in the Concurrent Agreements) arising under the
Concurrent Agreements (as more particularly set forth in Article 7 of the
Concurrent Agreements), exceeds $375,000 in which event Buyer and its
Affiliates shall be entitled to seek indemnification under this Section 7.02
for the amount of such Losses in excess of $375,000; provided, however, that
the limitations set forth in this Section 7.02(c) shall not be taken into
account in determining the amount of the Working Capital and Reimbursable
Capital Expenditures determined in accordance with the procedure set forth in
Section 3.03(b) (which determination shall be made without any exclusions
whatsoever by reason of the foregoing); provided further, however, that the
foregoing limitation with respect to Buyer's or its Affiliates' right to
indemnification shall not be applicable to Losses arising from or relating to
(and Buyer and its Affiliates shall be entitled to indemnification for all such
Losses commencing with the first dollar of such Losses) (i) any breach of the
Title Representations, the Authorization Representations, the Tax
Representations, the Employee Representations and the liabilities and
obligations of Sellers under Sections 3.05 and 7.03 hereof and under Article 8
hereof; (ii) any Losses arising by reason of or relating to any inaccuracy or
omission relating to current assets or current liabilities included on the
Closing Date Balance Sheets, which affected in any way
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the determination of Working Capital or Reimbursable Capital Expenditures
pursuant to Section 3.03 hereof and which were known to, or should have been
reasonably foreseeable by, Sellers at the time of preparation of the Closing
Date Balance Sheets; or (iii) any Losses arising by reason of or relating to
any litigation listed on Exhibit 5.01(d) annexed hereto.
(d) As collateral security for Sellers' or Partners'
indemnification obligations under this Agreement and Seller's or its
Affiliates' indemnification obligations under the Concurrent Agreements,
Sellers, or their Affiliates shall deliver, or cause to be delivered, to a
national bank to be mutually agreed to (the "Escrow Agent") to be held in
escrow pursuant to the terms of an Escrow Agreement, in substantially the form
of Exhibit 7.02(d) annexed hereto (the "Escrow Agreement"), to be entered into
on the Closing Date, at Seller's option either Six Million ($6,000,000) Dollars
in cash or Four Hundred Eighty Thousand (480,000) shares of Buyer's Class A
Common Stock, no par value ("Shares"), issued in accordance with the Merger
Agreement (such cash or shares being referred to herein as the "Escrow Fund").
The Escrow Fund shall be held by the Escrow Agent pursuant to the Escrow
Agreement for a period of one (1) year and one hundred eighty (180) days after
the Closing Date; provided, however, that on the first anniversary of the
Closing Date the Escrow Fund shall be reduced to an amount equal to the lesser
of the balance of the Escrow Fund on such first anniversary or 75% (if the
Escrow Fund is originally funded with Shares, as measured by Shares) of the
original Escrow Fund (except to the extent any claims in excess of such reduced
amount have been asserted prior to such first anniversary). The Escrow
Agreement shall set forth the procedures for Buyer to make any claims against
the Escrow Fund, the circumstances under which such Escrow Fund shall be
distributed either to Buyer or to Sellers and procedures for the Sellers to
substitute cash in lieu of stock. Nothing contained in this Section 7.02(d) or
in the Escrow Agreement shall limit in any way Sellers' and Partners'
indemnification obligations under this Agreement or the indemnification
obligations of Sellers or their Affiliates, as applicable, under the Concurrent
Agreements; it being understood that, if the Escrow Fund is not sufficient to
satisfy such indemnification obligations, then Sellers, the Partners and
Sellers' Affiliates, as applicable, shall (subject to Section 7.02(b) hereof)
remain liable for such indemnification obligations as set forth in this
Agreement or in the Concurrent Agreements.
7.03. Tax Indemnification.
(a) During the Indemnification Period (or thereafter solely with
respect to any claim for indemnification for which notice has been given prior
to the expiration of the Indemnification Period, each Seller and each Partner
hereby agrees, jointly and severally, to indemnify and hold harmless Buyer and
its Affiliates from and against (i) all liability for Taxes of Sellers
(including any liability for Taxes by reason of Sellers being included in a
Federal or state consolidated, combined or unitary return and including any Tax
liabilities resulting from the transactions contemplated by this Agreement),
and amounts with respect to liability for Taxes pursuant to any written or
unwritten agreement for the allocation or payment of or with respect to Tax
liabilities or benefits ("Tax Sharing Arrangements"; such amounts being
included in the definition of "Taxes" for purposes of this Section 7.03), to
the extent such Taxes, in the aggregate, exceed the reserve therefor on the
Closing Date Balance Sheets and (ii) any liability for out-of-pocket fees,
costs and expenses (including reasonable attorney's fees) arising out of or
incident to any Tax indemnified hereunder. If any amount for which Sellers and
Partners are to indemnify Buyer and its Affiliates
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pursuant to the immediately preceding sentence is, subject to Sellers' rights
under Section 7.03(b), determined to be payable (whether as a payment of
estimated tax or otherwise) after the Closing Date, Sellers shall pay or cause
to be paid to Buyer such amount no later than the later of (A) five (5)
Business Days after Buyer gives notice to Sellers of both the amount due and
the date such amount is due and payable (the "Due Date") and (B) three (3)
Business Days before the Due Date. Amounts described in clause (ii) shall be
reimbursed as incurred. Any payment required to be made hereunder and not made
at the time specified in the preceding two sentences shall bear interest at the
prime rate of The Toronto-Dominion Bank as in effect from time to time or such
higher rate actually payable by the indemnified party on the delayed payment of
the Taxes being indemnified, calculated from the date such payment was required
to be made hereunder to the date such payment is actually received by the
indemnified party. "Taxes" shall mean all taxes of any kind, including those
on, or measured by or referred to as income, gross receipts, sales, use, ad
valorem, franchise, profits, license, withholding, payroll, employment, excise,
severance, stamp, occupation, premium, property or windfall profits taxes,
customs duties or similar fees, assessments or charges of any kind whatsoever,
together with any interest and any penalties, additions to tax or additional
amounts imposed by any taxing authority, domestic or foreign.
(b) If any claim or demand is asserted by any taxing authority in
writing with respect to a Tax indemnified hereunder, Buyer shall notify Sellers
of such claim or demand within fifteen (15) days of receipt thereof; provided,
however, that failure to give such notification shall not affect the
indemnified party's entitlement to indemnification hereunder except to the
extent the indemnifying party shall have been actually prejudiced as a result
of such failure. The indemnifying party shall have the right to control the
defense, compromise or settlement thereof; provided, however, that the
indemnifying party shall not be permitted to take any action with respect to an
issue that could adversely affect the Tax liability of the indemnified party
(with respect to liabilities not indemnified hereunder) unless the indemnified
party consents to such action. Without limiting the indemnifying party's
rights under the preceding sentence, the indemnified party shall be permitted
to participate in the defense of any such claim or demand, at its own expense.
The indemnified party shall cooperate fully in such defense as and to the
extent reasonably requested by the indemnifying party. Such cooperation shall
include the retention and (upon the indemnifying party's request) the provision
to the indemnifying party of records and information which are reasonably
relevant to such claims or demand and making employees available on a mutually
convenient basis to provide additional information and explanation of any
material provided hereunder.
7.04. Buyer's Indemnity.
(a) During the Indemnification Period (or thereafter solely with
respect to any claim for indemnification for which notice has been given prior
to expiration of the Indemnification Period), in addition to any other
indemnification provided for under this Agreement, from and after the Closing,
Buyer shall indemnify and hold harmless Sellers and their respective Affiliates
from and against any and all Losses (as defined in Section 7.02, except that
reasonable fees and disbursements of counsel, accountants and other experts
shall be included whether they relate to claims, actions or causes of action
asserted by Sellers against Buyer or asserted by third parties) incurred or
suffered by Sellers and their Affiliates and their respective officers,
directors, partners, employees, agents and representatives arising out of,
resulting from, or relating to:
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(i) any breach of any of the representations or
warranties made by Buyer in this Agreement or in any agreement, certificate or
other instrument delivered by Buyer pursuant to this Agreement; and
(ii) any failure by Buyer to perform any of its covenants
or agreements contained in this Agreement or in any agreement, certificate or
other instrument delivered by Buyer pursuant to this Agreement.
(b) Notwithstanding anything to the contrary contained in this
Section 7.04, neither Sellers nor their Affiliates shall be entitled to seek
indemnification under this Section 7.04 for any Losses unless the aggregate
amount of Sellers' and their Affiliates' Losses in respect of all such matters,
when aggregated with the aggregate amount of Sellers' or their Affiliates'
Losses (as such terms are defined in the Concurrent Agreements) arising under
the Concurrent Agreements (as more particularly set forth in Article 7 of the
Concurrent Agreements), exceeds $375,000 in which event Sellers and their
Affiliates shall be entitled to seek indemnification under this Section 7.04
for the amount of such Losses in excess of $375,000; provided, however, that
the limitations set forth in this Section 7.04(b) shall not be taken into
account in determining the amount of the Working Capital and Reimbursable
Capital Expenditures determined in accordance with the procedure set forth in
Section 3.03(b) (which determination shall be made without any exclusions
whatsoever by reason of the foregoing); provided further, however, that the
foregoing limitation with respect to Sellers' right to indemnification shall
not be applicable to Losses arising from or relating to (and Sellers shall be
entitled to indemnification for all such Losses commencing with the first
dollar of such Losses) any breach of the representation and warranty set forth
in the first sentence of Section 5.02(b) hereof.
7.05. Procedure.
(a) In the event that any party hereto shall sustain or incur any
Losses in respect of which indemnification may be sought by such party pursuant
to this Article 7, the party seeking such indemnification (the "Indemnitee")
shall assert a claim for indemnification by giving prompt (in the event of
claims arising by reason of the commencement of litigation against an
Indemnitee by third parties, in no event later than ten (10) days after service
of process, which process expressly indicates a claim for which Indemnitor (as
hereinafter defined) may be liable) written notice thereof (the "Notice"),
which shall describe in reasonable detail the facts and circumstances upon
which the asserted claim for indemnification is based, to the party providing
indemnification (the "Indemnitor") and shall thereafter keep the Indemnitor
reasonably informed with respect thereto; provided that failure of the
Indemnitee to give the Indemnitor prompt notice as provided herein shall not
relieve the Indemnitor of any of its obligations hereunder, except to the
extent that the Indemnitor is materially prejudiced by such failure. In case
any third party claim, action or proceeding (a "Claim") is brought against any
Indemnitee, the Indemnitor shall have the right to assume, conduct and control
the defense, compromise or settlement thereof, by written notice to the
Indemnitee of its intention to do so within thirty (30) days after receipt of
the Notice, with counsel reasonably satisfactory to the Indemnitee, at the
Indemnitor's own expense, and thereupon to prosecute in the name and on behalf
of the Indemnitee any available cross-claims, counter-claims or third-party
claims arising with respect to the Claim. If the Indemnitor shall assume the
defense of
Execution - 38 -
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such Claim, it shall not settle such Claim unless such settlement includes as
an unconditional term thereof the giving by the claimant or the plaintiff of a
release of the Indemnitee, reasonably satisfactory to the Indemnitee, from all
liability with respect to such Claim. As long as the Indemnitor is contesting
any such Claim in good faith and on a timely basis, the Indemnitee shall not
pay or settle any such Claim. Notwithstanding the assumption by the Indemnitor
of the defense of any Claim as provided in this Section 7.05 and without
limiting the Indemnitor's right to assume, conduct and control the defense,
compromise or settlement thereof, the Indemnitee shall be permitted to join in
the defense of such Claim and to employ counsel at its own expense.
(b) If the Indemnitor shall fail to notify the Indemnitee of its
desire to assume the defense of any such Claim within the prescribed 30-day
period set forth in Section 7.05(a), or shall notify the Indemnitee that it
will not assume the defense of any such Claim, then the Indemnitee may assume
the defense of any such Claim, in which event it may do so in such manner as it
may deem appropriate, and the Indemnitor shall be bound by any determinations
made in any litigation with respect to such Claim or any settlement thereof
effected by the Indemnitee, provided that any such determinations or settlement
shall not affect the right of the Indemnitor to dispute the Indemnitee's claim
for indemnification. The failure of the Indemnitor to assume the defense of
any Claim shall not be deemed a concession by Indemnitor that it is required to
indemnify the Indemnitee for the subject matter of such Claim.
(c) Amounts payable by the Indemnitor to the Indemnitee in respect
of any Losses for which any party is entitled to indemnification hereunder
shall be payable by the Indemnitor as incurred by the Indemnitee. Any
payments by any Indemnitor in indemnification hereunder shall be treated as
adjustments to the Purchase Price.
(d) The provisions of this Section 7.05 shall be subject to the
provisions of Section 7.03(b).
7.06. Indemnification Payments in Cash. All payments by Sellers to
Buyer or its Affiliates in respect of any indemnification obligation to Buyer
or its Affiliates shall be made by Sellers in cash, or at Sellers' option, if
the Escrow Fund contains shares of Class A Common Stock, by the delivery to
Buyer or its Affiliates of shares of its Class A Common Stock from the Escrow
Fund (valuing such shares so delivered at the average closing price on NASDAQ
of such shares for the six (6) Business Days immediately preceding the date of
the delivery of such shares).
7.07. Investigations; Waivers. The survival periods and rights to
indemnification provided for in this Article 7 shall remain in effect
notwithstanding any investigation at any time by or on behalf of any party
hereto or any waiver by any party hereto of any condition to such party's
obligations to consummate the transactions contemplated hereby.
7.08. Indemnity Sole Remedy. In the absence of fraud or of a suit
seeking specific performance as contemplated by this Agreement, the remedies
provided to each Seller and to Buyer by the foregoing provisions of this
Article 7 shall after the Closing Date be in lieu of any other remedies to
which the respective party is entitled at law or in equity for any breach or
noncompliance by a party with the provisions of this Agreement.
Execution - 39 -
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ARTICLE 8
EMPLOYEES AND EMPLOYEE BENEFIT PLANS
8.01. Employees.
(a) On or before thirty (30) days prior to the Closing Date, Buyer
will provide written notice to Sellers setting forth the identity of the
Employees it desires to employ after the Closing Date. Sellers agree to use
all reasonable efforts to assist Buyer in employing such Employees and, in this
regard, to terminate such Employees on or prior to the Closing Date.
(b) Upon reasonable notice, Sellers shall, and Partners shall
cause Sellers to, provide Buyer with access to the Employees during normal
business hours throughout the period on and before the Closing Date in
accordance with the procedure established in Section 4.01(b). Such access
shall be for the purpose of interviewing the Employees and providing transition
training for those Employees continuing in employment after the Closing Date.
(c) Buyer and Sellers shall consult regarding communications with
the Employees whom Buyer does not intend to retain after the Closing so as to
minimize any adverse impact on the Businesses. Upon the reasonable request of
Buyer, Sellers shall, and Partners shall cause Sellers to, use all
commercially reasonable efforts to minimize such impact, including enforcing
Sellers' rights under any confidential or non-compete agreement with such
Employees (other than the non-compete agreements of Xxxxx X. Xxxxx or Xxxxx X.
Xxxxxxx).
(d) Nothing contained in this Agreement shall confer upon any
Employee any right with respect to continued employment with Buyer. No
provision of this Agreement shall create any third-party rights in any
Employee, or beneficiary or dependent thereof, with respect to the
compensation, terms and conditions of employment and benefits that may be
provided to such Employee by the Buyer after the Closing Date.
8.02. Employee Benefit Plans.
(a) All medical, dental, vision, travel accident, accidental death
and dismemberment, and life insurance expenses incurred by Employees and their
dependents on or before the Closing Date, pursuant to Employee Plans,
irrespective of the time at which claims are presented, are the responsibility
of Sellers and shall be paid directly by Sellers or their medical, dental or
life insurance carrier to such Employees and dependents.
(b) Sellers shall be responsible for any medical, dental or life
insurance coverage due to any Employees and their dependents who retired on or
before the Closing Date.
(c) Sellers, jointly and severally, agree to fulfill their
obligations under continuation coverage rules of COBRA with respect to a
"qualifying event," within the meaning of Section 4980B(f) of the Code or
Section 603 of ERISA, occurring on or before the Closing Date with respect to
any Employees and their dependents.
Execution - 40 -
42
(d) All short-term, long-term and extended disability benefits
payable to Employees and their dependents who became disabled on or before the
Closing Date are the responsibility of Sellers and shall be paid directly by
Sellers or their insurance carriers to such Employees and their dependents.
(e) If any Employees are terminated from employment by a Seller as
a result of the transactions contemplated by this Agreement or otherwise, any
obligations arising out of such termination of employment, including severance,
accrued vacation pay, COBRA obligations, notices or compensation required under
the Worker Adjustment and Retraining Notification ("WARN") Act, employment
discrimination complaints, unfair labor practice charges, grievance under any
collective bargaining agreement, breach of contract claims, and wrongful
termination and related tort claims shall be the sole responsibility of such
Seller.
(f) Sellers and Partners hereby jointly and severally agree, until
expiration of all applicable statutes of limitations, to indemnify, hold
harmless and defend Buyer and its Affiliates from and against any and all
claims, damages, liabilities and expenses including reasonable attorney's fees
and disbursements of counsel, incurred by Buyer or any of its Affiliates
arising from or in connection with any failure of Sellers or their Affiliates
to discharge their responsibilities to pay benefits under paragraphs (a) - (e)
of this Section 8.01.
ARTICLE 9
MISCELLANEOUS
9.01. Expenses. Each party shall bear its own expenses incident to
the negotiation, preparation, authorization and consummation of this Agreement
and the transactions contemplated hereby, including all fees and expenses of
its counsel and accountants, whether or not such transactions are consummated.
9.02. Equitable Remedies. The parties hereto agree that irreparable
damage would occur in the event that any of the provisions of this Agreement
were not performed in accordance with the specific terms of the provisions or
were otherwise breached. It is accordingly agreed that the parties shall be
entitled to an injunction or injunctions to prevent breaches of this Agreement
and to enforce specifically the terms and provisions hereof in any court of the
United States or any state having jurisdiction, this being in addition to any
other remedy to which they are entitled at law or in equity. Each party agrees
that it will not assert, as a defense against a claim for specific performance,
that the party seeking specific performance has an adequate remedy at law.
9.03. Notices. All notices, claims and other communications
hereunder shall be in writing and shall be made by hand delivery, registered or
certified mail (postage prepaid, return receipt requested), facsimile, or
overnight air courier guaranteeing next day delivery (a) if to Buyer, to it at
Western Wireless Corporation, 0000 XX Xxxxxxxxx Xxxx, Xxxxxxxx, Xxxxxxxxxx
00000, Attention: Xxxx X. Xxxxxx, Esq. (Fax No. 000-000-0000), with a copy
(which shall not constitute notice) to Xxxxx Xxxx Xxxxx Constant & Xxxxxxxx, 00
Xxxxxxxxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxx X. Xxxxxxx, Esq.
(Fax No. 000-000-0000) or (b) if to any Seller or Partner, to it at 0000 Xxxx
Xxxx Xxxx, Xxxxx Xxxx, Xxxxxxxxxx 00000, Attention: Xxxxx Xxxxx (Fax
Execution - 41 -
43
No. 415-854-4512), with a copy (which shall not constitute notice) to Xxxxxxx &
Xxxxxx, 000 Xxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000, Attention: Xxxxxxx X.
Xxxxxxxx, Esq. (Fax No. 000-000-0000), or at such other address as any party
may from time to time furnish to the other parties by a notice given in
accordance with the provisions of this Section 9.03. All such notices and
communications shall be deemed to have been duly given at the time delivered by
hand, if personally delivered; five (5) Business Days after being deposited in
the mail, first class postage prepaid, return receipt requested, if mailed;
when receipt confirmed, if sent by facsimile; and the next Business Day after
timely delivery to the courier, if sent by an overnight air courier service
guaranteeing next day delivery.
9.04. Entire Agreement. This Agreement, together with the Exhibits
annexed hereto, contains the entire understanding among the parties hereto
concerning the subject matter hereof and may not be changed, modified, altered
or terminated except by an agreement in writing executed by the parties hereto.
Any waiver by any party of any of its rights under this Agreement or of any
breach of this Agreement shall not constitute a waiver of any other rights or
of any other or future breach.
9.05. Remedies Cumulative. Except as otherwise provided herein, each
and all of the rights and remedies in this Agreement provided, and each and all
of the rights and remedies allowed at law and in equity in like case, shall be
cumulative, and the exercise of one right or remedy shall not be exclusive of
the right to exercise or resort to any and all other rights or remedies
provided in this Agreement or at law or in equity.
9.06. Governing Law. This Agreement shall be construed in accordance
with and subject to the laws and decisions of the State of Washington
applicable to contracts made and to be performed entirely therein.
9.07. Counterparts. This Agreement may be executed in several
counterparts hereof, and by the different parties hereto on separate
counterparts hereof, each of which shall be an original; but such counterparts
shall together constitute one and the same instrument.
9.08. Waivers. No provision in this Agreement shall be deemed waived
by course of conduct, including the act of Closing, unless such waiver is in
writing signed by the parties and stating specifically that it was intended to
modify this Agreement.
9.09. Successors and Assigns. This Agreement shall be binding upon
and inure to the benefit of the parties hereto and to their respective
successors and assigns. No Seller and no Partner shall have the right to
assign this Agreement or any of its rights or obligations hereunder to any
Person; provided, however, that Buyer shall have the right to assign this
Agreement and its rights and obligations hereunder in accordance with Section
1.03 hereof.
9.10 Further Assurances. Buyer shall, at the request of Sellers and
Partners, and each Seller and each Partner shall, at the request of Buyer, from
time to time, execute and deliver such other assignments, transfers,
conveyances and other instruments and documents and do and perform such other
acts and things as may be reasonably necessary or desirable for effecting
complete consummation of this Agreement and the transactions herein
contemplated.
Execution - 42 -
44
9.11. Disclosures.
(a) Each of Buyer and each Seller and each Partner acknowledges
and confirms in connection with the negotiation of this Agreement and the
execution hereof, during the period from the date hereof through the Closing
Date, the parties hereto will have furnished to one another certain materials,
information, data and other documentation ("Disclosures") concerning their
business, financial condition and operations which are proprietary and
confidential. Each party acknowledges the party disclosing such Disclosures
considers them secret and confidential and asserts a proprietary interest
therein. Accordingly, each of Buyer and each Seller and each Partner covenants
and agrees that it shall maintain all Disclosures made by another party in
strict confidence and shall not use such Disclosures for its own benefit or
disclose them to third parties, except to its agents, representatives, bankers,
investment bankers, counsel and employees involved in evaluating the
transactions contemplated by this Agreement, its partners (and the partners or
other security holders thereof) or as otherwise required by law (including the
requirement of Buyer to disclose such terms under any Federal or state
securities laws); provided, however, that in no event shall Sellers be
permitted to disclose the Purchase Price or any information concerning the
calculation of the Purchase Price to any other Person (including its employees)
unless and until such time as such information otherwise becomes public.
(b) No public announcement by any party hereto with regard to the
transactions contemplated hereby or the material terms hereof (including the
Purchase Price) shall be issued by any party without the mutual prior consent
of the other parties, except in the event the parties are unable to agree on a
press release and legal counsel for one party is of the opinion that such press
release is required by law and such party furnishes the other parties a written
opinion of outside legal counsel, or other counsel reasonably acceptable to the
party being furnished such opinion, to that effect, then such party may issue
the legally required press release.
(c) This Agreement shall not restrict any party hereto from using
information already known to it, to which it is entitled under existing
agreements, or information generally in the public domain or any information
coming into its possession after it becomes public knowledge unless it became
public knowledge through a breach of this Agreement.
9.12. Termination.
(a) This Agreement may be terminated and the transactions
contemplated hereby may be abandoned, without further obligation of either
Seller or any Partner, or Buyer, at any time prior to the Closing Date as
follows:
(i) by mutual written consent duly authorized by the
general partners and board of directors, as applicable, of Sellers and Partners
and board of directors of Buyer; or
(ii) by Sellers and Partners or by Buyer if the Closing
shall not have occurred on or before the first anniversary of the date hereof,
or such later date, if any, as Sellers, Partners and Buyer shall agree in
writing; provided, that the party exercising such right is not in default of
its obligations under this Agreement in a manner which results in the failure
to satisfy the conditions to Closing of the other parties; or
Execution - 43 -
45
(iii) by Sellers and Partners or by Buyer if the
consummation of the transactions contemplated hereby shall be prohibited by a
final, non-appealable order, decree or injunction of a court of competent
jurisdiction or of the FCC.
(b) In the event of a termination of this Agreement, no party
hereto shall have any liability or further obligation to any other party to
this Agreement except that nothing herein will relieve any party from liability
for any breach of this Agreement.
9.13. Definitions; Etc.
Unless the context otherwise requires, the terms defined in any
Section of this Agreement shall have the meanings therein specified for all
purposes of this Agreement, applicable to both the singular and plural forms of
any of the terms defined herein. When a reference is made in this Agreement to
a Section, such reference shall be to a Section of this Agreement unless
otherwise indicated. Whenever the words "include", "includes" or "including"
are used in this Agreement, they shall be deemed to be followed by the words
"without limitation". The use of a gender herein shall be deemed to include the
neuter, masculine and feminine genders wherever necessary or appropriate.
Whenever the word "herein" or "hereof" is used in this Agreement, it shall be
deemed to refer to the Agreement and not to a particular Section of the
Agreement unless expressly stated otherwise.
Execution - 44 -
46
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the date first above written.
WESTERN WIRELESS CORPORATION
By: /s/ XXXX X. XXXXXXX
---------------------------------
Title: Chief Executive Officer
TRIAD TEXAS, L.P.
By: Triad Cellular Corporation, a
general partner
By: /s/ XXXXX X. XXXXX
-----------------------------------
Title: President
By: Triad Cellular L.P., a general
partner
By: Triad Cellular Corporation, its
general partner
By: /s/ XXXXX X. XXXXX
-----------------------------------
Title: President
TRIAD UTAH, L.P.
By: Triad Cellular Corporation,
a general partner
By: /s/ XXXXX X. XXXXX
----------------------------------
Title: President
By: Triad Cellular L.P., a
general partner
By: Triad Cellular Corporation,
its general partner
By: /s/ XXXXX X. XXXXX
-------------------------------
Title: President
47
TRIAD OKLAHOMA, L.P.
By: Triad Cellular Corporation, a
general partner
By: /s/ XXXXX X. XXXXX
---------------------------------
Title: President
By: Triad Cellular L.P., a
general partner
By: Triad Cellular Corporation, its
general partner
By: /s/ XXXXX X. XXXXX
---------------------------------
Title: President
TRIAD CELLULAR CORPORATION
By: /s/ XXXXX X. XXXXX
---------------------------------
Title: President
TRIAD CELLULAR L.P.
By: Triad Cellular Corporation, its
general partner
By: /s/ XXXXX X. XXXXX
---------------------------------
Title: President
