EXHIBIT 10.16
ASSET PURCHASE AGREEMENT
By and Between
AMERICAN TOWER SYSTEMS, INC.
DB CONSULTANTS, INC.
Dated as of
May 21, 1997
TABLE OF CONTENTS
ARTICLE 1 DEFINED TERMS...................................................................................1
ARTICLE 2 SALE AND PURCHASE OF ASSETS.....................................................................1
2.1 Agreement to Sell and Buy..............................................................1
2.2 Assumption of Liabilities and Obligations. ............................................1
2.3 Closing; Purchase Price................................................................3
2.4 Accounts Receivable....................................................................3
ARTICLE 3 REPRESENTATIONS AND WARRANTIES OF DBC...........................................................4
3.1 Organization and Business; Power and Authority; Effect of Transaction..................4
3.2 Financial and Other Information. .....................................................5
3.3 Changes in Condition...................................................................5
3.4 Materiality............................................................................5
3.5 Title to Properties; Leases............................................................5
3.6 Compliance with Private Authorizations.................................................5
3.7 Compliance with Governmental Authorizations and Applicable Law.........................6
3.8 Intangible Assets......................................................................7
3.9 Related Transactions...................................................................7
3.10 Solvency...............................................................................7
3.12 Employee Retirement Income Security Act of 1974........................................7
3.13 Absence of Sensitive Payments..........................................................7
3.14 Inapplicability of Specified Statutes..................................................8
3.15 Employment Arrangements................................................................8
3.16 Material Agreements....................................................................8
3.17 Ordinary Course of Business............................................................8
3.18 Broker or Finder.......................................................................9
ARTICLE 4 REPRESENTATIONS AND WARRANTIES OF ATS...........................................................9
4.1 Organization and Business; Power and Authority; Effect of Transaction..................9
4.2 Broker or Finder......................................................................10
4.3 Solvency..............................................................................10
4.4 No Legal Action.......................................................................10
ARTICLE 5 CLOSING CONDITIONS.............................................................................10
5.1 Conditions to Obligations of Each Party to effect the Transactions....................10
5.2 Conditions to Obligations of ATS......................................................11
5.3 Conditions to Obligations of DBC......................................................12
ARTICLE 6 INDEMNIFICATION................................................................................12
6.1 Survival..............................................................................12
6.2 Indemnification.......................................................................12
6.3 Limitation of Liability...............................................................13
6.4 Notice of Claims......................................................................13
6.5 Defense of Third Party Claims.........................................................14
6.6 Exclusive Remedy......................................................................14
ARTICLE 7 GENERAL PROVISIONS.............................................................................14
7.1 Amendment.............................................................................14
7.2 Waiver................................................................................14
7.3 Fees, Expenses and Other Payments.....................................................14
7.4 Notices...............................................................................14
7.5 Specific Performance; Other Rights and Remedies.......................................15
7.6 Severability..........................................................................16
7.7 Counterparts..........................................................................16
7.8 Section Headings......................................................................16
7.9 Governing Law.........................................................................16
7.10 Further Acts..........................................................................16
7.11 Entire Agreement......................................................................17
7.12 Assignment............................................................................17
7.13 Parties in Interest...................................................................17
7.14 Arbitration...........................................................................17
7.15 Mutual Drafting.......................................................................17
APPENDIX A: Definitions
SCHEDULES: DBC Disclosure Schedule
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ASSET PURCHASE AGREEMENT
This Asset Purchase Agreement (this "Agreement") is dated as of May 21,
1997 by and between American Tower Systems, Inc., a Delaware corporation
("ATS"), and DB Consultants, Inc., a Texas corporation ("DBC").
WHEREAS, DBC is engaged in the business of identifying and locating and
managing communication sites for third parties (the "DBC Business"); and
WHEREAS, ATS desires to purchase and DBC desires to sell the DBC Assets
and the DBC Business on the terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the above premises and the
covenants and agreements contained herein, the parties, intending to be legally
bound, do hereby covenant and agree as follows:
ARTICLE 1
DEFINED TERMS
As used herein, unless the context otherwise requires, the terms
defined in Appendix A shall have the respective meanings set forth therein.
Terms defined in the singular shall have a comparable meaning when used in the
plural, and vice versa, and the reference to any gender shall be deemed to
include all genders. Unless otherwise defined or the context otherwise clearly
requires, terms for which meanings are provided in this Agreement shall have
such meanings when used in the DBC Disclosure Schedule and each Collateral
Document executed or required to be executed pursuant hereto or thereto or
otherwise delivered, from time to time, pursuant hereto or thereto. References
to "hereof", "herein" or similar terms are intended to refer to the Agreement as
a whole and not a particular Section, and references to "this Section" are
intended to refer to the entire Section and not a particular subsection thereof.
The term "either party" shall, unless the context otherwise requires, refer to
DBC and ATS.
ARTICLE 2
SALE AND PURCHASE OF ASSETS
2.1 Agreement to Sell and Buy. Subject to the terms and conditions set
forth in this Agreement, DBC hereby agrees to sell, assign, transfer and deliver
to ATS at the Closing, and ATS agrees to purchase at the Closing, the DBC Assets
and the DBC Business, free and clear of any Liens of any nature whatsoever
except for Permitted Liens. For purposes of this Agreement, the term "DBC
Assets" shall mean all of the Assets of DBC set forth on Schedule 2.1 of the DBC
Disclosure Schedule.
2.2 Assumption of Liabilities and Obligations.
(a) At the Closing, ATS shall assume and agree to pay, discharge and
perform the following obligations and liabilities of DBC (collectively, the "DBC
Assumed Obligations"): (i) all of the obligations and liabilities of DBC under
the DBC Assumable Agreements, and (ii) all obligations and liabilities of DBC
with respect to the ownership and operation of the DBC Assets and the conduct of
the DBC Business, on and
after the Closing Date; provided, however, that notwithstanding the foregoing,
ATS shall not assume and agree to pay, and shall not be obligated with respect
to, the DBC Nonassumed Obligations.
(b) ATS shall not assume or become obligated to perform any debt,
liability or obligation of DBC relating to any of the following matters
(collectively, the "DBC Nonassumed Obligations"):
(i) the ownership or operation of the DBC Assets or the
conduct of the DBC Business prior to the Closing Date, including
without limitation Taxes, unfunded pension costs, any Employment
Arrangement of DBC (including without limitation any obligation to any
DBC Employee for severance benefits, vacation time or sick leave), and
any of the following to the extent same arise from Events occurring
prior to or existing on the Closing Date: products liability, Legal
Actions or other Claims, and obligations and liabilities relating to
Environmental Law;
(ii) any obligations or liabilities under the DBC Assumable
Agreements relating to the period prior to the Closing;
(iii) any insurance policies of DBC;
(iv) those required to be disclosed in the DBC Disclosure
Schedule which are not so disclosed or which, if disclosed, Section
2.2(b)(iv) of the DBC Disclosure Schedule indicates that such
obligation or liability will not be assumed;
(v) any liability or obligation from or relating to breach of
any warranty or any misrepresentation by DBC under this Agreement or
any Collateral Document;
(vi) any liability or obligation from or relating to breach or
violation of, or failure to perform, any of DBC's obligations,
covenants, agreements or undertakings set forth in this Agreement or
any Collateral Document, including without limitation Article 5 of this
Agreement;
(vii) any obligation or liability relating to any asset of DBC
not included in the DBC Assets.
(viii) any obligation or liability with respect to capitalized
lease obligations or Indebtedness for Money Borrowed;
(ix) any Taxes, fees, expenses or other amounts required to be
paid by DBC pursuant to the provisions of this Agreement or any
Collateral Document; and
(x) any Contract with any Affiliate of DBC, other than those,
if any, set forth in Section 2(b)(x) of the DBC Disclosure Schedule.
All DBC Nonassumed Obligations shall remain and be the obligations and
liabilities solely of DBC.
(c) Notwithstanding anything contained in this Agreement to the
contrary, except as set forth in Section 2.2(c) of the DBC Disclosure Schedule,
all items of income and expense (including without limitation with respect to
rent, utility charges, Pro Ratable Taxes and wages, salaries and accrued but
unused vacation of DBC employees) arising from the ownership or operation of the
DBC Assets or the conduct of the DBC Business shall be prorated as of 12:01
a.m., Eastern time, on the Closing Date, with DBC entitled to and responsible
for any such items on or prior to the Closing Date and ATS entitled to and
responsible for any such items relating to any subsequent period. For these
purposes, Pro Ratable Taxes attributable to a period that begins before and ends
after the Closing Date shall be treated on a "closing of the books" basis
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as two partial periods, one ending at the close of the Closing Date and the
other beginning on the day after the Closing Date, except that Pro Ratable Taxes
(such as property Taxes) imposed on a periodic basis shall be allocated on a
daily basis. If either party shall have received any such revenues or paid any
such expenses or charges which, pursuant to the terms hereof, the other party is
entitled to or responsible for, it shall furnish the other party with a detailed
statement of any such items as soon as practicable after receipt or payment
thereof. The parties shall use their best efforts to agree upon such items and
other adjustments prior to the Closing Date and, in any event, except as set
forth in Section 2.2(c) of the DBC Disclosure Schedule, within sixty (60) days
thereafter. If the parties are unable within such period to agree upon such
items and other adjustments, DBC and ATS shall, within the following ten (10)
days, jointly designate a nationally known independent public accounting firm to
be retained to review such items and other adjustments. The fees and other
expenses of retaining such independent public accounting firm shall be borne
equally by DBC and ATS. Such firm shall report its conclusions as to such items
and other adjustments pursuant to this Section and such report shall be
conclusive on all parties to this Agreement and not subject to dispute or
review. Upon such agreement or determination by such independent accounting
firm, DBC or ATS, as the case may be, shall promptly reimburse the other party
for any income received or expenses paid by the other party and not previously
reimbursed or any other adjustment required by this Section.
Nothing contained in this Section 2.2(c) is intended or shall be deemed
to amend or modify the indemnification provisions of Article 8 nor to reallocate
responsibility for the matters set forth therein.
2.3 Closing; Purchase Price. The closing of the Transactions (the
"Closing") shall take place at ▇▇▇▇▇▇▇▇ & Worcester LLP, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, at 10:00 a.m., local time, on May 21, 1997 or such
other date, prior to the Termination Date, as the parties may agree (the
"Closing Date"). At the Closing, each of the parties shall deliver such bills of
sale, assignments, assumptions of liabilities, opinions and other instruments
and documents as are described in this Agreement or as may be otherwise
reasonably requested by the parties and their respective counsel. The purchase
price for the DBC Assets and the DBC Business (the "Purchase Price") shall be an
amount equal to $3,137,000 subject to adjustment as provided in Section 2.2(d)
plus an amount equal to the Prepaid Expenses and minus an amount equal to the
sum of (i) the DBC Nonassumed Obligations, if any, which ATS agrees to assume,
and (ii) Prepaid Revenues.
2.4 Accounts Receivable. At the closing, DBC shall appoint ATS its
agent for the purpose of collecting all Accounts Receivable relating to the DBC
Business. DBC shall deliver to ATS on or as soon as practicable after the
Closing Date a complete and detailed statement showing the name, amount and age
of each Accounts Receivable of the DBC Business. Subject to and limited by the
following, revenues relating to the Accounts Receivable relating to the DBC
Business will be for the account of DBC. ATS shall use the same procedures and
efforts which it uses with respect to its own accounts receivable to collect the
Accounts Receivable with respect to the DBC Business for a period of ninety (90)
days after the Closing Date (the "Collection Period"). Any payment received by
ATS during the Collection Period from any customer with an account which is an
Accounts Receivable with respect to the DBC Business shall first be applied in
reduction of the Accounts Receivable, unless the customer contests the validity
of such application. If the customer contests the validity of any payment
received by ATS during the Collection Period to be applied in reduction of the
Accounts Receivable, then ATS shall promptly notify DBC and any payment with
respect to which application is contested as aforesaid shall be placed in an
escrow arrangement reasonably satisfactory to ATS and DBC until the validity of
the application is determined. During the Collection Period, ATS shall furnish
DBC with a list of, and pay over to DBC, the amounts collected with respect to
the Accounts Receivable with respect to the DBC Business on a monthly basis and
forward to DBC, promptly upon receipt or delivery, as the case may be, copies of
all correspondence relating to Accounts Receivable. ATS shall provide DBC with a
final accounting on or before the fifteenth (15th) day following the end of the
Collection Period. Upon the request of either party at and after such time, the
parties shall meet to mutually
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and in good faith analyze any uncollected Accounts Receivable to determine if
the same, in their reasonable business judgment, are deemed to be collectable
and if ATS desires to retain such Accounts Receivable. As to each such Accounts
Receivable, the parties shall negotiate a good faith value of such Accounts
Receivable, which ATS shall pay to DBC if ATS, in its sole discretion, chooses
to retain such Accounts Receivable. DBC shall retain the right to collect any of
its Accounts Receivable as to which the parties are unable to reach agreement as
to a good faith value, and ATS agrees to turn over to DBC any payments received
against any such Accounts Receivable. ATS shall not be obligated to use any
extraordinary efforts to collect any of the Accounts Receivable assigned to it
for collection hereunder or to refer any of such Accounts Receivable to a
collection agency or to any attorney for collection, and ATS shall not make any
such referral or compromise, nor settle or adjust the amount of any such
Accounts Receivable, except with the approval of DBC. ATS shall not incur any
liability to DBC for any uncollected account unless ATS shall have engaged in
willful misconduct or gross negligence in the performance of its obligations set
forth in this Section. During and after the Collection Period, without specific
agreement with ATS to the contrary, neither DBC nor its agents shall make any
direct solicitation of the Accounts Receivable for collection purposes, except
for Accounts Receivable retained by DBC after the Collection Period.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF DBC
DBC hereby represents, warrants and covenants to, and agrees with, ATS
as follows:
3.1 Organization and Business; Power and Authority; Effect of
Transaction.
(a) DBC is a corporation duly organized, validly existing and in good
standing under the laws of its jurisdiction of organization, has all requisite
power and authority (corporate and other) to own or hold under lease its
properties and to conduct its business as now conducted.
(b) DBC has all requisite corporate power and corporate authority and
has in full force and effect all Governmental Authorizations and Private
Authorizations, except for those set forth in Section 3.1(b) of the DBC
Disclosure Schedule or those the failure of which to obtain do not and will not
have, individually or in the aggregate, any material adverse effect on DBC,
necessary to enable it to execute and deliver, and to perform its obligations
under, this Agreement and each Collateral Document executed or required to be
executed by it pursuant hereto or thereto or to consummate the Transactions; and
the execution, delivery and performance of this Agreement and each Collateral
Document executed or required to be executed by it pursuant hereto or thereto
have been duly authorized by all requisite corporate or other action on the part
of either of the DBC. This Agreement has been duly executed and delivered by DBC
and constitutes, and each Collateral Document executed or required to be
executed by it pursuant hereto or thereto or to consummate the Transactions when
executed and delivered by DBC will constitute, legal, valid and binding
obligations of DBC, enforceable in accordance with their respective terms,
except as such enforceability may be limited by bankruptcy, moratorium,
insolvency and similar laws affecting the rights and remedies of creditors and
obligations of debtors generally and by general principles of equity.
(c) Except as set forth in Section 3.1(c) of the DBC Disclosure
Schedule, and except for matters which would have no material adverse effect on
the DBC, neither the execution and delivery by DBC of this Agreement or any
Collateral Document executed or required to be executed by it pursuant hereto or
thereto, nor the consummation by DBC of the Transactions, nor compliance with
the terms, conditions and provisions hereof or thereof by DBC:
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(i) will conflict with, or result in a breach or violation of,
or constitute a default under, any Organic Document of DBC or any
Applicable Law on the part of DBC, or will conflict with, or result in
a breach or violation of, or constitute a default under, or permit the
acceleration of any obligation or liability in, or but for any
requirement of giving of notice or passage of time or both would
constitute such a conflict with, breach or violation of, or default
under, or permit any such acceleration in, any Contractual Obligation
of DBC, other than those constituting DBC Nonassumed Obligations;
provided, however, that DBC makes no representation and warranty that
any Contractual Obligation which requires a consent to its assignment
will not be breached if such consent is not obtained prior to the
Closing and the rights of DBC thereunder are nevertheless assigned to
ATS; or
(ii) will require DBC to make or obtain any Governmental
Authorization, Governmental Filing or Private Authorization including
without limitation under the FCA.
(d) DBC has no Subsidiaries.
3.2 Financial and Other Information. The DBC has heretofore furnished
to ATS copies of the internally prepared cash basis income and expense
statements of the DBC Business listed in Section 3.2 of the DBC Disclosure
Schedule (the "DBC Statements"). The DBC Statements are true, accurate and
complete cash basis income and expense statements in all material respects, do
not contain any untrue statement of a material fact, and fairly present the cash
flow of the DBC Business for the respective periods covered thereby, subject to
normal nonmaterial adjustments. ATS acknowledges that no representations have
been made by DBC that (a) the past financial performance of DBC as reflected in
the DBC Statements (and on the Tax Returns furnished pursuant to the provisions
of Section 3.11) are in any way reflective of future financial performance and
(b) that certain amounts of income included in the DBC Statements (and on the
Tax Returns furnished pursuant to the provisions of Section 3.11) are derived
from sources other than the DBC Assets.
3.3 Changes in Condition. Since the date of the most recent statements
constituting a part of the DBC Statements, except to the extent specifically
described in Section 3.3 of the DBC Disclosure Schedule, there has been no
material adverse change in the DBC Assets or the DBC Business. There is no Event
known to DBC which materially adversely affects, or (so far as DBC can now
reasonably foresee) is likely to materially adversely affect, the DBC Assets or
the DBC Business, except to the extent specifically described in Section 3.3 of
the DBC Disclosure Schedule.
3.4 Materiality. The representations and warranties set forth in this
Article would in the aggregate be true and correct even without the materiality
exceptions or qualifications contained therein or set forth in the DBC
Disclosure Schedule, except for such exceptions and qualifications including
without limitation those set forth in the DBC Disclosure Schedule which, in the
aggregate for all such representations and warranties, are not and could not
reasonably be expected to be materially adverse to the DBC Assets or the DBC
Business.
3.5 Title to Properties; Leases. DBC does not own or lease any real
property or lease any personal property that is part of the DBC Assets or own
any material items of tangible personal property and, therefore, no real
property or any material items of tangible personal property or any interest
therein is being transferred.
3.6 Compliance with Private Authorizations. Section 3.6 of the DBC
Disclosure Schedule sets forth a true, accurate and complete list and
description of each Private Authorization which individually is material to the
DBC Assets or the DBC Business. DBC has obtained all Private Authorizations
which are necessary for the ownership or operation of the DBC Assets or the
conduct of the DBC Business which, if
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not obtained and maintained, could, individually or in the aggregate, materially
adversely affect DBC; provided, however, that the representations and warranties
set forth in this Section are not intended to apply to (a) any of the consents
required in order to assign the DBC Assets to ATS pursuant to the provisions of
this Agreement, and (b) the failure of DBC to obtain any or all of the consents
required in order to assign the DBC Assets to ATS pursuant to the provisions of
this Agreement. All of such Private Authorizations are valid and in good
standing and are in full force and effect. DBC is not in breach or violation of,
or in default in the performance, observance or fulfillment of, any such Private
Authorization, and no Event exists or has occurred, which constitutes, or but
for any requirement of giving of notice or passage of time or both would
constitute, such a breach, violation or default, under any such Private
Authorization, except for such defaults, breaches or violations as do not and
will not have in the aggregate any material adverse effect on DBC; provided,
however, that the foregoing representation and warranty is not intended to apply
to the failure of DBC to obtain all consents required in order to assign the DBC
Assets to ATS pursuant to the provisions of this Agreement. No such Private
Authorization is the subject of any pending or, to DBC's knowledge, threatened
attack, revocation or termination.
3.7 Compliance with Governmental Authorizations and Applicable Law.
(a) Except as otherwise specifically described in Section 3.7(a) of the
DBC Disclosure Schedule, there is no Governmental Authorization required under
Applicable Laws (i) to own and operate the DBC Business, as currently conducted
or proposed to be conducted on or prior to the Closing Date, or (ii) that is
necessary to permit DBC to execute and deliver this Agreement and to perform its
obligations hereunder; provided, however, that the foregoing representation and
warranty is not intended to apply to consents of Persons (other than
Authorities) required in order to assign the DBC Assets to ATS pursuant to the
provisions of this Agreement.
(b) Except as otherwise specifically described in Section 3.7(b) of the
DBC Disclosure Schedule, neither DBC nor any director or officer thereof (in
connection with ownership or operation of the DBC Assets or the conduct of the
DBC Business) is in or is charged by any Authority with or, to DBC's knowledge,
at any time since January 1, 1993 has been in or has been charged by any
Authority with, or, to DBC's knowledge, is threatened or under investigation by
any Authority with respect to, breach or violation of, or default in the
performance, observance or fulfillment of, any Applicable Law relating to the
ownership and operation of the DBC Assets or the conduct of the DBC Business. In
particular, but without limiting the generality of the foregoing, there are no
applications, complaints or Legal Actions pending or, to DBC's knowledge,
threatened before or by any Authority (x) relating to the ownership or operation
of the DBC Assets or the conduct of the DBC Business which, individually or in
the aggregate, are reasonably likely to result in the imposition of any
restriction of such a nature as would adversely affect the ownership or
operation of the DBC Assets or the conduct of the DBC Business; (y) involving
charges of illegal discrimination by DBC under any federal or state employment
Laws, or (z) involving Environmental Laws or zoning laws, except as otherwise
specifically described in Section 3.7(b) of the DBC Disclosure Schedule.
(c) Except as otherwise specifically described in Section 3.7(c) of the
DBC Disclosure Schedule, no Event exists or has occurred, which, to DBC's
knowledge, constitutes, or but for any requirement of giving of notice or
passage of time or both would constitute, such a breach, violation or default,
under any Applicable Law, except for such breaches, violations or defaults as do
not and will not have, individually or in the aggregate, any material adverse
effect on the DBC Assets or the DBC Business.
(d) With respect to matters, if any, of a nature referred to in Section
3.7(b) or 3.7(c) of the DBC Disclosure Schedule, except as otherwise
specifically described in Section 3.7(d) of the DBC Disclosure Schedule, all
such information and matters set forth in the DBC Disclosure Schedule, if
adversely determined
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against DBC, will not, individually or in the aggregate, have a materially
adverse effect on the DBC Assets or the DBC Business.
3.8 Intangible Assets. There are no Intangible Assets (other than
Private Authorizations) required for the ownership or operation of the DBC
Assets or the conduct of the DBC Business as currently owned, operated and
conducted or proposed to be owned, operated and conducted on or prior to the
Closing Date. DBC, to its knowledge, does not wrongfully infringe upon or
unlawfully use any Intangible Assets owned or claimed by another, and DBC has
not received any notice of any claim or infringement relating to any such
Intangible Asset.
3.9 Related Transactions. DBC is not a party or subject to any
Contractual Obligation relating to the ownership or operation of the DBC Assets
or the conduct of the DBC Business between DBC and any of its officers,
directors, shareholders, employees or, to the knowledge of DBC, any Affiliate of
any thereof, including without limitation any Contractual Obligation providing
for the furnishing of services to or by, providing for rental of property, real,
personal or mixed, to or from, or providing for the lending or borrowing of
money to or from or otherwise requiring payments to or from, any such Person,
other than (i) Employment Arrangements listed or described in Section 3.15 of
the DBC Disclosure Schedule, (ii) Contractual Obligations between DBC and any of
its directors, shareholders, officers, employees or Affiliates of DBC or any of
the foregoing, which constitute assets other than DBC Assets or DBC Nonassumed
Obligations, or (iii) as specifically set forth in Section 3.9 of the DBC
Disclosure Schedule.
3.10 Solvency. As of the execution and delivery of this Agreement, DBC
is, and immediately prior to and after giving effect to the consummation of the
Transactions will be, solvent.
3.11 Tax Matters.
(a) DBC is not a "consenting corporation" within the meaning of Section
341(f) of the Code. DBC has at all times been taxable as a Subchapter C
corporation under the Code, and has never been a member of any consolidated
group for Tax purposes, except as otherwise set forth in Section 3.11(a) of the
DBC Disclosure Schedule.
(b) The information shown on the federal income Tax Returns of DBC for
each of the most recent four tax years (true and complete copies of which have,
to the extent requested by ATS, been furnished by DBC to ATS) is true, accurate
and complete in all material respects and fairly and accurately reflects the
information purported to be shown. Federal Tax Returns of DBC have not been
examined by the Internal Revenue Service, and DBC has not been notified of any
proposed examination, except as shown in Section 3.11(b) of the DBC Disclosure
Schedule.
(c) DBC is not a party to any tax sharing agreement or arrangement.
3.12 Employee Retirement Income Security Act of 1974. DBC (which for
purposes of this Section shall include any ERISA Affiliate) is not making any
contribution to or sponsoring, and has not at any time since its organization
made any contribution to or sponsored, any Plan or Benefit Arrangement which is
subject to ERISA.
3.13 Absence of Sensitive Payments. Neither DBC nor, to DBC's
knowledge, any of its officers, directors, employees, agents or other
representatives, has with respect to the DBC Assets or the DBC Business (a) made
any contributions, payments or gifts to or for the private use of any
governmental official, employee or agent where either the payment or the purpose
of such contribution, payment or gift is illegal
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under the laws of the United States or the jurisdiction in which made or (b)
established or maintained any unrecorded fund or asset for any purpose or made
any false or artificial entries on its books.
3.14 Inapplicability of Specified Statutes. DBC is not a "holding
company", or a "subsidiary company" or an "affiliate" of a "holding company", as
such terms are defined in the Public Utility Holding Company Act of 1935, as
amended, or an "investment company" or a company "controlled" by or acting on
behalf of an "investment company", as defined in the Investment Company Act of
1940, as amended, or a "carrier" or a person which is in control of a "carrier",
as defined in section 11301 of Title 49, U.S.C.
3.15 Employment Arrangements. Section 3.15 of the DBC Disclosure
Schedule contains a true, accurate and complete list of all employees and
consultants of DBC involved in the ownership or operation of the DBC Assets or
the conduct of the DBC Business (the "DBC Employees"), together with each such
employee's title or the capacity in which he or she is employed and the basis
for the DBC Employees' compensation. DBC has no obligation or liability,
contingent or other, under any Employment Arrangement with any DBC Employee,
other than those listed or described in Section 3.15 of the DBC Disclosure
Schedule. Except as described in Section 3.15 of the DBC Disclosure Schedule,
(a) none of the DBC Employees is now, or since January 1, 1993 has been,
represented by any labor union or other employee collective bargaining
organization, and DBC is not and never has been a party to any labor or other
collective bargaining agreement with respect to any of the DBC Employees, (b)
there are no pending grievances, disputes or controversies with any union or any
other employee or collective bargaining organization of the DBC Employees, or
threats of strikes, work stoppages or slowdowns or any pending demands for
collective bargaining by any such union or other organization, (c) neither DBC
nor any of the DBC Employees is now, or has since January 1, 1993 been, subject
to or involved in or, to DBC's knowledge, threatened with, any union elections,
petitions therefore or other organizational or recruiting activities, in each
case with respect to the DBC Employees, and (d) none of the DBC Employees has
notified DBC that he or she does not intend to continue employment with DBC
until the Closing or with ATS following the Closing. DBC has performed in all
material respects all obligations required to be performed under all Employment
Arrangements and is not in material breach or violation of or in material
default or arrears under any of the terms, provisions or conditions thereof.
3.16 Material Agreements. Listed on Section 3.16 of the DBC Disclosure
Schedule are all Material Agreements relating to the ownership or operation of
the DBC Assets or the conduct of the business of the DBC Business or to which
DBC is a party or to which it is bound or which any of the DBC Assets is
subject. True, accurate and complete copies of each of such Material Agreements
have been made available by DBC to ATS and DBC has provided ATS with photocopies
of all such Material Agreements requested by ATS. All of such Material
Agreements are valid, binding and legally enforceable obligations of DBC and, to
DBC's knowledge, all other parties thereto, except as such enforceability may be
limited by bankruptcy, moratorium, insolvency and similar laws affecting the
rights and remedies of creditors and obligations of debtors generally and by
general principles of equity. DBC has duly complied with all of the material
terms and conditions of each such Material Agreement and has not done or
performed, or failed to do or perform (and there is no pending or, to the
knowledge of DBC, Claim threatened in writing that DBC has not so complied, done
and performed or failed to do and perform) any act which would invalidate or
provide grounds for the other party thereto to terminate (with or without
notice, passage of time or both) such Material Agreement or impair the rights or
benefits, or increase the costs, of DBC under any of such Material Agreements in
any material respect.
3.17 Ordinary Course of Business. DBC, from the date of the most recent
DBC Financial Statements to the date hereof, except (i) as may be described on
Section 3.17 of the DBC Disclosure Schedule, or (ii) as may be required or
expressly contemplated by the terms of this Agreement, with respect to the DBC
Assets and the DBC Business:
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(a) has operated its business in all material respects in the
normal, usual and customary manner in the ordinary and regular course
of business, consistent with prior practice;
(b) except in each case in the ordinary course of business,
consistent with prior practice:
(i) has not incurred any obligation or liability
(fixed, contingent or other) individually having a value in
excess of $20,000;
(ii) has not sold or otherwise disposed of or
contracted to sell or otherwise dispose of any of its
properties or assets having a value in excess of $20,000;
(iii) has not entered into any individual commitment
having a value in excess of $20,000; and
(iv) has not canceled any debts or claims;
(c) has not created or permitted to be created any Lien on any
of its property;
(d) has not increased the compensation payable or to become
payable to any of the DBC Employees other than in the ordinary course
of business or otherwise materially altered, modified or changed the
terms of their employment, except for its officers;
(e) has not waived any rights of material value under any
Contractual Obligation constituting a part of the DBC Assets without
fair and adequate consideration;
(f) has not experienced any work stoppage; and
(g) except in the ordinary course of business, has not entered
into, amended or terminated any Private Authorizations or Material
Agreement constituting a part of the DBC Assets.
3.18 Broker or Finder. No Person assisted in or brought about the
negotiation of this Agreement or the Transactions in the capacity of broker,
agent or finder or in any similar capacity on behalf of DBC.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF ATS
ATS represents, warrants and covenants to, and agrees with, DBC as
follows:
4.1 Organization and Business; Power and Authority; Effect of
Transaction.
(a) ATS is a corporation duly organized, validly existing and in good
standing under the laws of its jurisdiction of incorporation and has all
requisite power and authority (corporate and other) to own or hold under lease
its properties and to conduct its business as now conducted.
(b) ATS has all requisite corporate power and corporate authority
necessary to enable it to execute and deliver, and to perform its obligations
under, this Agreement and each Collateral Document executed or required to be
executed by it pursuant hereto or thereto or to consummate the Transactions; and
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the execution, delivery and performance of this Agreement and each Collateral
Document executed or required to be executed by it pursuant hereto or thereto
have been duly authorized by all requisite corporate or other action on the part
of ATS. This Agreement has been duly executed and delivered by ATS and
constitutes, and each Collateral Document executed or required to be executed by
it pursuant hereto or thereto or to consummate the Transactions when executed
and delivered by ATS will constitute, legal, valid and binding obligations of
ATS, enforceable in accordance with their respective terms, except as such
enforceability may be limited by bankruptcy, moratorium, insolvency and similar
laws affecting the rights and remedies of creditors and the obligations of
debtors generally and by general principles of equity.
(c) Except for matters which would have no material adverse effect on
ATS, neither the execution and delivery by ATS of this Agreement or any
Collateral Document executed or required to be executed by it pursuant hereto or
thereto, nor the consummation by ATS of the Transactions, nor compliance with
the terms, conditions and provisions hereof or thereof by ATS:
(i) will conflict with, or result in a breach or violation of,
or constitute a default under, any Organic Document of ATS or any
Applicable Law on the part of ATS, or will conflict with, or result in
a breach or violation of, or constitute a default under, or permit the
acceleration of any obligation or liability in, or but for any
requirement of giving of notice or passage of time or both would
constitute such a conflict with, breach or violation of, or default
under, or permit any such acceleration in, any Contractual Obligation
of ATS; or
(ii) will require ATS to make or obtain any Governmental
Authorization, Governmental Filing or Private Authorization including
without limitation under the FCA.
4.2 Broker or Finder. No Person assisted in or brought about the
negotiation of this Agreement or the Transactions in the capacity of broker,
agent or finder or in any similar capacity on behalf of ATS.
4.3 Solvency. As of the execution and delivery of this Agreement, ATS
is, and immediately prior to and after giving effect to the consummation of the
Transactions will be, solvent.
4.4 No Legal Action. There are no Legal Actions pending or, to the
knowledge of ATS, threatened against ATS or any of its Affiliated Entities,
officers or directors, that question or may affect the validity of this
Agreement or the right of ATS to consummate the transactions contemplated
hereunder.
ARTICLE 5
CLOSING CONDITIONS
5.1 Conditions to Obligations of Each Party to effect the Transactions.
The respective obligations of each party to effect the Transactions shall,
except as hereinafter provided in this Section, be subject to the satisfaction
at or prior to the Closing Date of the following conditions, any or all of which
may be waived, in whole or in part, to the extent permitted by Applicable Law:
(a) As of the Closing Date, no Legal Action shall be pending
before or threatened in writing by any Authority seeking to enjoin,
restrain, prohibit or make illegal or to impose any materially adverse
conditions in connection with, the consummation of the Transactions, it
being understood and agreed that a written request by any Authority for
information with respect to the Transactions, which information could
be used in connection with such Legal Action, shall not in itself be
deemed to be a threat of any such Legal Action;
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(b) All authorizations, consents, waivers, orders or approvals
required to be obtained from all Authorities, and all filings,
submissions, registrations, notices or declarations required to be made
by ATS and DBC with any Authority, prior to the consummation of the
Transactions, shall have been obtained from, and made with, all such
Authorities, except for such authorizations, consents, waivers, orders,
approvals, filings, registrations, notices or declarations the failure
to obtain or make would not, in the reasonable business judgment of
ATS, have a material adverse effect on the DBC Assets or the DBC
Business; and
(c) The transactions contemplated by the Other Agreement shall
be consummated simultaneously with the Closing.
5.2 Conditions to Obligations of ATS. The obligation of ATS to effect
the Transactions shall be subject to the satisfaction of the following
conditions, any or all of which may be waived, in whole or in part, to the
extent permitted by Applicable Law:
(a) All agreements, certificates, opinions and other documents
required to be delivered pursuant to the provisions of this Agreement
shall be reasonably satisfactory in form, scope and substance to ATS
and its counsel, and ATS and its counsel shall have received all
information and copies of all documents, including records of corporate
proceedings, which they may reasonably request in connection therewith,
such documents where appropriate to be certified by proper Authorities
or corporate officers;
(b) DBC shall have furnished ATS and, at ATS' request, any
bank or other financial institution providing credit to ATS, with a
favorable opinion, dated the Closing Date of ▇▇▇▇▇▇ ▇▇▇▇▇▇, Esq.,
counsel for DBC, or other counsel to DBC reasonably acceptable to ATS,
with respect to the matters set forth in Sections 3.1(a), (b) and (c)
and 3.7(b) (to such counsel's knowledge);
(c) DBC shall have furnished ATS with such certificates and
other documents evidencing the truth of its representations,
warranties, covenants and agreements and the performance of its
agreements or conditions as ATS or its counsel shall have reasonably
requested;
(d) DBC shall have delivered or cause to be delivered to ATS
all of the Collateral Documents and other agreements, documents and
instruments required to be delivered by DBC to ATS at or prior to the
Closing pursuant to the terms of this Agreement;
(e) ATS shall have received advice from its independent
accountants to the effect that, if requested by ATS, an unqualified
report (as to the scope of the audit, access to the books and records
and the cooperation of management) on the financial statements
(consisting of balance sheets for each of the fiscal years ended
December 31, 1995 and 1996 and statements of operations and cash flow
for each of the three years in the period ended December 31, 1996) of
the DBC Business in conformity with GAAP and Regulation S-X under the
Securities Act could be prepared; and
(f) The individual named therein shall have executed and
delivered to ATS an indemnity agreement (the "Indemnity Agreement"), in
form, scope and substance reasonably satisfactory to ATS.
5.3 Conditions to Obligations of DBC. The obligation of DBC to effect
the Transactions shall be subject to the satisfaction of the following
conditions, any or all of which may be waived, in whole or in part, to the
extent permitted by Applicable Law:
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(a) All agreements, certificates, opinions and other documents
required to be delivered pursuant to the provisions of this Agreement
shall be reasonably satisfactory in form, scope and substance to DBC
and its counsel, and DBC and its counsel shall have received all
information and copies of all documents, including records of corporate
proceedings, which they may reasonably request in connection therewith,
such documents where appropriate to be certified by proper Authorities
or corporate officers;
(b) ATS shall have furnished DBC and, at DBC's request, any
bank of other financial institution providing credit to DBC, with
favorable opinions, dated the Closing Date of ▇▇▇▇▇▇▇▇ & Worcester LLP,
counsel for ATS, with respect to the matters set forth in Sections 4.1
and 4.4;
(c) ATS shall have furnished DBC with such certificates and
other documents evidencing the truth of its representations,
warranties, covenants and agreements and the performance of its
agreements or conditions as DBC or its counsel shall have reasonably
requested; and
(d) ATS shall have delivered or cause to be delivered to DBC
all of the Collateral Documents and other agreements, documents and
instruments required to be delivered by ATS to DBC at or prior to the
Closing pursuant to the terms of this Agreement.
ARTICLE 6
INDEMNIFICATION
6.1 Survival. The representations and warranties of the parties
contained in or made pursuant to Sections 3 and 4 of this Agreement or any
Collateral Document shall survive the Closing and shall remain operative and in
full force and effect for a period of (a) one (1) year after the Closing Date or
(b) the applicable statute of limitations in the case of matters of a nature
referred to in Sections 3.1, 3.11, 3.12, 4.1 and 4.4, regardless of any
investigation or statement as to the results thereof made by or on behalf of any
party hereto. The covenants and agreements of the parties contained in or made
pursuant to all of the other Sections of this Agreement or any Collateral
Document shall survive the Closing and shall remain operative and in full force
and effect for the statute of limitations applicable to contractual obligations.
The term "Indemnity Period" shall mean the applicable period with respect to
which a representation, warranty, covenant or agreement survives the Closing as
provided in this Section. Any Claim for indemnification, no matter how arising,
not asserted by written notice to the Indemnifying Party prior to the expiration
of the applicable Indemnity Period and for which arbitration for such Claim
pursuant to Section 7.14 of this Agreement is not commenced within sixty (60)
days of said written notice shall be waived and of no force and effect.
6.2 Indemnification. Each of DBC and ATS (the "Indemnifying Party")
agrees that on and after the Closing it shall, subject to survival periods set
forth in Section 6.1, indemnify and hold harmless the other (the "Indemnified
Party") from and against any and all damages, claims, losses, expenses, costs,
obligations and liabilities, including without limitation liabilities for all
reasonable attorneys', accountants' and experts' fees and expenses including
those incurred to enforce the terms of this Agreement or any Collateral Document
executed by it (collectively, "Loss and Expense" provided, however, that Loss
and Expense shall, in the case of damages, be limited to actual damages and
shall not include any type of punitive, consequential (including without
limitation loss of anticipated profits) or any other measure of damages
permitted by Applicable Law or otherwise), suffered directly by the Indemnified
Party by reason of, or arising out of:
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(a) any breach of representation or warranty made by the
Indemnifying Party pursuant to this Agreement or any Collateral
Document executed by it or any failure by the Indemnifying Party to
perform or fulfill any of its respective covenants or agreements set
forth in this Agreement or any Collateral Document executed by it; or
(b) any Legal Action or other Claim by any third party
relating to the Indemnifying Party or, in the case of ATS, the
ownership or operations of the DBC Assets or the conduct of the
business of the DBC Business to the extent such Legal Action or other
Claim has also resulted in a breach of representation or warranty by
the Indemnifying Party pursuant to this Agreement or any Collateral
Document executed by it; or
(c) in the case of DBC as the Indemnifying Party, by reason
of, or arising out of, (i) DBC Nonassumed Obligations or (ii) the
ownership and operation of the DBC Assets and the DBC Business prior to
the Closing Date; or
(d) in the case of ATS as the Indemnifying Party, by reason
of, or arising out of, (i) DBC Assumed Obligations or (ii) the
ownership and operation of the DBC Assets and the DBC Business from and
after the Closing Date, except for Events arising prior to or existing
on the Closing Date, unless they are part of the DBC Assumed
Obligations.
6.3 Limitation of Liability.
(a) Notwithstanding the provisions of Section 6.2, after the Closing,
except as otherwise provided in Section 6.6, each Indemnified Party's rights to
indemnification shall be subject to the following limitations: (i) the
Indemnified Party shall be entitled to recover its Loss and Expense in respect
of any Claim only in the event that the aggregate Loss and Expense for all
Claims exceeds, in the aggregate, $25,000, in which event the Indemnified Party
shall be entitled to recover all such Loss and Expense (including without
limitation such $25,000), and (ii) in no event shall the aggregate amount
required to be paid by an Indemnifying Party pursuant to the provisions of this
Article exceed $410,000, except for any Loss or Expense arising out of matters
of a nature referred to in Sections 3.1 and 4.1 as to which the limitations set
forth in this clause (ii) shall not apply.
(b) In the case any event shall occur which would otherwise entitle
either party to assert a claim for indemnification hereunder, no Loss and
Expense shall be deemed to have been sustained by such party to the extent of
any proceeds received by such party from any insurance policies with respect
thereto.
6.4 Notice of Claims. If an Indemnified Party believes that it has
suffered or incurred any Loss and Expense, it shall notify the Indemnifying
Party promptly in writing, and in any event within the applicable time period
specified in Section 6.1, describing such Loss and Expense, all with reasonable
particularity and containing a reference to the provisions of this Agreement in
respect of which such Loss and Expense shall have occurred. If any Legal Action
is instituted by a third party with respect to which an Indemnified Party
intends to claim any liability or expense as Loss and Expense under this
Article, such Indemnified Party shall promptly notify the Indemnifying Party of
such Legal Action, but the failure to so notify the Indemnifying Party shall not
relieve such Indemnifying Party of its obligations under this Article, except to
the extent such failure to notify prejudices such Indemnifying Party's ability
to defend against such Claim.
6.5 Defense of Third Party Claims. The Indemnifying Party shall have
the right to conduct and control, through counsel of their own choosing,
reasonably acceptable to the Indemnified Party, any third party Legal Action or
other Claim, but the Indemnified Party may, at its election, participate in the
defense
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thereof at its sole cost and expense; provided, however, that if the
Indemnifying Party shall fail to defend any such Legal Action or other Claim,
then the Indemnified Party may defend, through counsel of its own choosing, such
Legal Action or other Claim, and (so long as it gives the Indemnifying Party at
least fifteen (15) days' notice of the terms of the proposed settlement thereof
and permits the Indemnifying Party to then undertake the defense thereof) settle
such Legal Action or other Claim and recover the amount of such settlement or of
any judgment and the reasonable costs and expenses of such defense. The
Indemnifying Party shall not compromise or settle any such Legal Action or other
Claim without the prior written consent of the Indemnified Party, which consent
shall not unreasonably be withheld, delayed or conditioned if the terms and
conditions of such compromise or settlement proposed by the Indemnifying Party
and agreed to in writing by the claimant in such Legal Action or other Claim
(the "Settlement Proposal") (a) include a full release of the Indemnified Party
from the Legal Action or other Claim which is the subject of the Settlement
Proposal, and (b) if the Indemnified Party is ATS, do not include any term or
condition which would restrict in any material manner the continued ownership or
operations of the DBC Assets or the conduct of the DBC Business in substantially
the manner then being theretofore owned, operated and conducted by ATS.
6.6 Exclusive Remedy. Except for (a) fraud constituting dishonesty or
willful or intentional gross misrepresentation or willful or intentional gross
breach of warranty, covenant or agreement; provided, however, that any Claim
with respect to fraud constituting dishonesty or willful or intentional gross
misrepresentation or willful or intentional gross breach of warranty, covenant
or agreement, no matter how arising, not asserted by written notice to the party
alleged to have committed the same prior to May 21, 1999 and for which
arbitration with respect to such Claim pursuant to Section 7.14 of this
Agreement is not commenced within sixty (60) days of said written notice shall
be waived and of no force and effect; or (b) specific performance and injunctive
relief as provided in Section 7.5, the indemnification provided in this Article
shall be the sole and exclusive post-Closing remedy available to either party
against the other party for any Claim under this Agreement.
ARTICLE 7
GENERAL PROVISIONS
7.1 Amendment. This Agreement may be amended from time to time by the
parties hereto at any time prior to the Closing Date but only by an instrument
in writing signed by the parties hereto.
7.2 Waiver. At any time prior to the Closing Date, except to the extent
not permitted by Applicable Law, ATS or DBC may extend the time for the
performance of any of the obligations or other acts of the other, subject,
however, to the provisions with respect to the Termination Date, waive any
inaccuracies in the representations and warranties of the other contained herein
or in any document delivered pursuant hereto, and waive compliance by the other
with any of the agreements, covenants or conditions contained herein. Any such
extension or waiver shall be valid only if set forth in an instrument in writing
signed by the party or parties to be bound thereby.
7.3 Fees, Expenses and Other Payments. All costs and expenses incurred
in connection with this Agreement and the consummation of the Transactions,
including without limitation fees and disbursements of counsel, financial
advisors and accountants incurred by the parties hereto, shall be borne solely
and entirely by the party which has incurred such costs and expenses.
7.4 Notices. All notices and other communications which by any
provision of this Agreement are required or permitted to be given shall be given
in writing and shall be (a) mailed by first-class or express
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mail, or by recognized courier service, postage prepaid, (b) sent by telex,
telegram, telecopy or other form of rapid transmission, confirmed by mailing (by
first class or express mail, or by recognized courier service, postage prepaid)
written confirmation at substantially the same time as such rapid transmission,
or (c) personally delivered to the receiving party (which if other than an
individual shall be an officer or other responsible party of the receiving
party). All such notices and communications shall be mailed, sent or delivered
as follows:
(a) If to ATS:
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇, Chief Financial Officer
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇▇▇ & Worcester LLP
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
(b) If to DBC:
▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇'▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇, P.C.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
or to such other person(s), telex or facsimile number(s) or address(es) as the
party to receive any such communication or notice may have designated by written
notice to the other party.
7.5 Specific Performance; Other Rights and Remedies. Each party
recognizes and agrees that in the event the other party should refuse to perform
any of its obligations under this Agreement or any Collateral Document, the
remedy at law would be inadequate and agrees that for breach of such provisions,
each party shall, in addition to such other remedies as may be available to it
at law or in equity, be entitled to injunctive relief and to enforce its rights
by an action for specific performance to the extent permitted by Applicable Law.
The parties agree that the dispute underlying Claims of any action for specific
performance shall be decided by arbitration in accordance with the provisions of
Section 7.14. All actions for injunctive relief, specific performance or other
relief shall be determined in accordance with the governing law provisions of
Section 7.9. Nothing herein contained shall be construed as prohibiting each
party from pursuing any other remedies available to it pursuant to the
provisions of and subject to the limitations
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contained in this Agreement for such breach or threatened breach.
Notwithstanding the foregoing or any provision of this Agreement to the
contrary, after the Closing Date ATS shall not be entitled to specific
performance or any other remedy to the extent that the cost to DBC arising from
the enforcement or exercise of such remedy would exceed the amount of the
indemnification required by Section 6.3, for all costs and expenses incurred in
connection with its performance of or compliance with the remedy exercised or
enforced.
7.6 Severability. If any term or provision of this Agreement shall be
held or deemed to be, or shall in fact be, invalid, inoperative, illegal or
unenforceable as applied to any particular case in any jurisdiction or
jurisdictions, or in all jurisdictions or in all cases, because of the
conflicting of any provision with any constitution or statute or rule of public
policy or for any other reason, such circumstance shall not have the effect of
rendering the provision or provisions in question invalid, inoperative, illegal
or unenforceable in any other jurisdiction or in any other case or circumstance
or of rendering any other provision or provisions herein contained invalid,
inoperative, illegal or unenforceable to the extent that such other provisions
are not themselves actually in conflict with such constitution, statute or rule
of public policy, but this Agreement shall be reformed and construed in any such
jurisdiction or case as if such invalid, inoperative, illegal or unenforceable
provision had never been contained herein and such provision reformed so that it
would be valid, operative and enforceable to the maximum extent permitted in
such jurisdiction or in such case. Notwithstanding the foregoing, in the event
of any such determination the effect of which is to affect materially and
adversely either party, the parties shall negotiate in good faith to modify this
Agreement so as to effect the original intent of the parties as closely as
possible to the fullest extent permitted by Applicable Law in an acceptable
manner to the end that the Transactions are fulfilled and consummated to the
maximum extent possible.
7.7 Counterparts. This Agreement may be executed in several
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument, binding upon all of the
parties. In pleading or proving any provision of this Agreement, it shall not be
necessary to produce more than one of such counterparts.
7.8 Section Headings. The headings contained in this Agreement are for
reference purposes only and shall not in any way affect the meaning or
interpretation of this Agreement.
7.9 Governing Law. The validity, interpretation, construction and
performance of this Agreement shall be governed by, and construed in accordance
with, the applicable laws of the United States of America and the laws of the
Commonwealth of Massachusetts applicable to contracts made and performed in such
State and, in any event, without giving effect to any choice or conflict of laws
provision or rule that would cause the application of domestic substantive laws
of any other jurisdiction. Anything in this Agreement to the contrary
notwithstanding, including without limitation the provisions of Article 6, in
the event of any dispute between the parties which results in a Legal Action,
the prevailing party shall be entitled to receive from the non-prevailing party
reimbursement for reasonable legal fees and expenses incurred by such prevailing
party in such Legal Action. In the event of any Legal Action among the parties
arising out of this Agreement, the parties agree to submit the matter to the
appropriate state or federal court sitting in Suffolk County, Massachusetts and
the parties agree to submit to the jurisdiction of such courts.
7.10 Further Acts. Each party agrees that at any time, and from time to
time, before and after the consummation of the transactions contemplated by this
Agreement, it will do all such things and execute and deliver all such
Collateral Documents and other assurances, as any other party or its counsel
reasonably deems necessary or desirable in order to carry out the terms and
conditions of this Agreement and the transactions contemplated hereby or to
facilitate the enjoyment of any of the rights created hereby or to be created
hereunder.
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7.11 Entire Agreement. This Agreement (together with the DBC Disclosure
Schedule and the other Collateral Documents delivered in connection herewith),
constitutes the entire agreement of the parties and supersedes all prior
agreements and undertakings, both written and oral, between the parties, with
respect to the subject matter hereof, including without limitation that certain
letter of intent, dated March 6, 1997, between the parties. The parties have not
made or relied upon any warranties or representations except those specifically
set forth in this Agreement.
7.12 Assignment. This Agreement shall not be assignable by either party
and any such assignment shall be null and void, except that it shall inure to
the benefit of and by binding upon any successor to any party by operation of
law, including by way of merger, consolidation or sale of all or substantially
all of its assets, and ATS may assign its rights and remedies hereunder to any
bank or other financial institution which has loaned funds or otherwise extended
credit to it.
7.13 Parties in Interest. This Agreement shall be binding upon and
inure solely to the benefit of each party, and nothing in this Agreement,
express or implied, is intended to or shall confer upon any Person any right,
benefit or remedy of any nature whatsoever under or by reason of this Agreement,
except as otherwise provided in Section 7.12.
7.14 Arbitration. Subject to the provisions of Section 2.2(d) and the
right to seek injunctive relief and specific performance in accordance with the
provisions of Section 7.5 which shall take precedence over the provisions of
this Section, any controversy or claim arising out of or relating to this
Agreement, or the breach thereof, shall be determined by arbitration in
accordance with the governing law provisions of Section 7.9 and the then
existing commercial arbitration rules of the American Arbitration Association
before a panel of three (3) arbitrators in Boston, Massachusetts, selected
within thirty (30) days of the commencement of such arbitration, with each
participant selecting one arbitrator and the two so selected selecting the third
(or the third being selected by the American Arbitration Association if
agreement on a third is not reached within thirty (30) days); and the parties
hereto agree that any judgment or award rendered by such arbitrators shall be a
final and binding determination as to such matter or matters and may be entered
in any court having jurisdiction thereof; provided, however, that in the case of
damages, the parties shall, except in the case of a fraud constituting
dishonesty or willful or intentional gross misrepresentation or willful or
intentional gross breach of warranty, covenant or agreement, be limited to
actual damages and shall not be entitled to any type of punitive, consequential
(including without limitation loss of anticipated profits) or any other measure
of damages permitted by Applicable Law or otherwise. The arbitrators shall award
fees and expenses (including reasonable attorney fees and expenses) to the
prevailing party or, if they determine there is no prevailing party, as they may
otherwise determine.
7.15 Mutual Drafting. This Agreement is the result of the joint efforts
of DBC and ATS, and each provision hereof has been subject to the mutual
consultation, negotiation and agreement of the parties and there shall be no
construction against either party based on any presumption of that party's
involvement in the drafting thereof.
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IN WITNESS WHEREOF, ATS and DBC have caused this Agreement to be
executed as of the date first written above by their respective officers
thereunto duly authorized.
American Tower Systems, Inc.
By:_____________________________________
Name:
Title:
DB Consultants, Inc.
By:______________________________________
Name:
Title:
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APPENDIX A
DEFINITIONS
As used in this Agreement, unless the context otherwise requires, the
following terms (or any variant in the form thereof) have the following
respective meanings. Terms defined in the singular shall have a comparable
meaning when used in the plural, and vice versa, and the reference to any gender
shall be deemed to include all genders. Unless otherwise defined or the context
otherwise clearly requires, terms for which meanings are provided herein shall
have such meanings when used in the DBC Disclosure Schedule, and each Collateral
Document executed or required to be executed pursuant hereto or thereto or
otherwise delivered, from time to time, pursuant hereto or thereto. References
to "hereof", "herein" or similar terms are intended to refer to the Agreement as
a whole and not a particular Section, and references to "this Section" are
intended to refer to the entire Section and not a particular subsection thereof.
The term "either party" shall, unless the context otherwise requires, refer to
DBC and ATS.
Acceptance Notice shall have the meaning given to it in Section 2.2(c).
Accounts Receivable shall mean (a) any and all rights to the payment of
money or other forms of consideration of any kind at any time now or hereafter
owing or to be owing to DBC attributable to the ownership or operation of the
DBC Business (whether classified under the Uniform Commercial Code of any state
as accounts, contract rights, chattel paper, general intangibles or otherwise),
including without limitation accounts receivable, letters of credit and the
right to receive payment thereunder, chattel paper, insurance proceeds, contract
rights, notes, drafts, instruments, documents, acceptances, and all other debts,
obligations and liabilities in whatever form now or hereafter owing from any
other Person, all guarantees, security and Liens for the payment of any thereof,
and all of DBC's rights to goods, now owned or hereafter acquired, sold
(delivered, undelivered, in transit or returned) which may be represented
thereby; and (b) all proceeds of any of the foregoing.
adverse, adversely, when used alone or in conjunction with other terms
(including without limitation "affect," "change" and "effect") shall mean any
Event which is reasonably likely, in the reasonable business judgment of ATS, to
be expected to (a) adversely affect the validity or enforceability of this
Agreement or the likelihood of consummation of the Transactions, or (b)
adversely affect the business, operations, management, properties or prospects,
or the condition, financial or other, or results of operation of the DBC
Business, or (c) impair DBC's ability to fulfill its obligations under the terms
of this Agreement, or (d) adversely affect the aggregate rights and remedies of
ATS under this Agreement. Notwithstanding the foregoing, and anything in this
Agreement to the contrary notwithstanding, any Event generally affecting the
economy or the tower communications business shall not be deemed to constitute
such a change, affect or effect.
Affiliate, Affiliated shall mean, with respect to any Person, (a) any
other Person at the time directly or indirectly controlling, controlled by or
under direct or indirect common control with such Person, (b) any other Person
of which such Person at the time owns, or has the right to acquire, directly or
indirectly, twenty percent (20%) or more of any class of the capital stock or
beneficial interest, (c) any other Person which at the time owns, or has the
right to acquire, directly or indirectly, twenty percent (20%) or more of any
class of the capital stock or beneficial interest of such Person, (d) any
executive officer or director of such Person, (e) with respect to any
partnership, joint venture or similar Entity, any general partner thereof, and
(f) when used with respect to an individual, shall include any member of such
individual's immediate family or a family trust.
Agreement shall mean this Agreement as originally in effect, including,
unless the context otherwise specifically requires, this Appendix A, the DBC
Disclosure Schedule and all exhibits hereto, and as any of the same may from
time to time be supplemented, amended, modified or restated in the manner herein
or therein provided.
Applicable Law shall mean any Law of any Authority, whether domestic or
foreign, including without limitation the FCA and all federal and state
securities and Environmental Laws, to which a Person is subject or by which it
or any of its business or operations is subject or any of its property or assets
is bound.
Assets shall mean the business and the tangible and intangible assets
used in connection with the conduct of the business or operations of the DBC
Business, which business and assets are being exchanged, transferred or
otherwise conveyed hereunder, which are the following:
(a) the Private Authorizations;
(b) the Contracts (other than the DBC Nonassumed Obligations);
(c) all Intellectual Property and other proprietary
information, which relate to the DBC Business, including without
limitation, technical information and data, machinery and equipment
warranties, maps, computer discs and tapes, plans, diagrams, blueprints
and schematics, including filings with all Authorities which relate to
the DBC Business;
(d) all claims, choses in action and rights under warranties
relating to the DBC Business or any of the DBC Assets;
(e) all books and records relating to the ownership or
operation of the DBC Assets or the conduct of the DBC Business,
including executed copies of Material Agreements and other written
Contracts, and all records required by Applicable Law to be kept,
subject to the right of the conveying party to have such books and
records made available to it for such time as may be reasonably
required in connection with audits, defense or prosecution of lawsuits,
or other legitimate business purposes. The records described herein
shall not include corporate seals, certificates of incorporation,
minute books, stock books, tax returns or other records having to do
with the corporate organization of DBC; and
(f) any and all products, profits and proceeds of, and
including without limitation any Claims with respect to, any of the
foregoing.
ATS shall have the meaning given to it in the Preamble.
Authority shall mean any governmental or quasi-governmental authority,
whether administrative, executive, judicial, legislative or other, or any
combination thereof, including without limitation any federal, state,
territorial, county, municipal or other government or governmental or
quasi-governmental agency, arbitrator, authority, board, body, branch, bureau,
central bank or comparable agency or Entity, commission, corporation, court,
department, instrumentality, master, mediator, panel, referee, system or other
political unit or subdivision or other Entity of any of the foregoing, whether
domestic or foreign., including without limitation the FCC.
Benefit Arrangement shall mean any material benefit arrangement that is
not a Plan, including (a) any employment or consulting agreement (b) any
arrangement providing for insurance coverage or workers' compensation benefits,
(c) any incentive bonus or deferred bonus arrangement, (d) any arrangement
providing
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termination allowance, severance or similar benefits, (e) any equity
compensation plan, (f) any deferred compensation plan, and (g) any compensation
policy and practice, but only to the extent that it covers or relates to any
officer, employee or other Person involved in the ownership and operation of the
Assets or the conduct of the business of the DBC Business.
Claims shall mean any and all debts, liabilities, obligations, losses,
damages, deficiencies, assessments and penalties, together with all Legal
Actions, pending or threatened, claims and judgments of whatever kind and nature
relating thereto, and all fees, costs, expenses and disbursements (including
without limitation reasonable attorneys' and other legal fees, costs and
expenses) relating to any of the foregoing.
Closing shall have the meaning given to it in Section 2.3.
Closing Date shall have the meaning given to it in Section 2.3.
COBRA shall mean the Consolidated Omnibus Budget Reconciliation Act of
1985, as amended, as set forth in Section 4980B of the Code and Part 6 of
Subtitle B of Title I of ERISA.
Code shall mean the Internal Revenue Code of 1986, and the rules and
regulations thereunder, all as from time to time in effect, or any successor
law, rules or regulations, and any reference to any statutory or regulatory
provision shall be deemed to be a reference to any successor statutory or
regulatory provision.
Collateral Document shall mean the Indemnity Agreement, bills of sale,
assignments of intangibles, assumption agreements with respect to the DBC
Assumed Obligations, other instruments of conveyance and assignment sufficient
to vest in ATS title to all of the other DBC Assets and the DBC Business, and
any other agreement, certificate, contract, instrument, notice, opinion or other
document delivered pursuant to the provisions of this Agreement or any
Collateral Document.
Collection Period shall have the meaning given to it in Section 2.4.
Contract, Contractual Obligation shall mean any agreement, arrangement,
commitment, contract, covenant, indemnity, undertaking or other obligation or
liability which involves the ownership or operation of the DBC Assets or the
conduct of the DBC Business.
Control (including the terms "controlled," "controlled by" and "under
common control with") means the possession, directly or indirectly or as trustee
or executor, of the power to direct or cause the direction of the management or
policies of a Person, or the disposition of such Person's assets or properties,
whether through the ownership of stock, equity or other ownership, by contract,
arrangement or understanding, or as trustee or executor, by contract or credit
arrangement or otherwise.
DBC shall have the meaning given to it in the Preamble.
DBC Assets shall have the meaning given to it in Section 2.1.
DBC Assumable Agreements shall mean all obligations and liabilities of
DBC under all Leases, Material Agreements, Governmental Authorizations, Private
Authorizations and other Contractual Obligations not required to be listed on
Section 3.16 of the DBC Disclosure Schedule entered into in the ordinary course
of business and relating to the ownership or operation of any of the DBC Assets
or the
conduct of the DBC Business.
DBC Assumed Obligations shall have the meaning given to it in Section
2.2(b).
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DBC Business shall have the meaning given them in the first Whereas
paragraph.
DBC Disclosure Schedule shall mean the DBC Disclosure Schedule dated as
of the date of this Agreement delivered by DBC to ATS.
DBC Employees shall have the meaning given it in the Section 3.15.
DBC Nonassumed Obligations shall have the meaning given to it in
Section 2.2(b).
DBC Statements shall have the meaning given to it in Section 3.2(b).
DBC's knowledge means the actual knowledge of any officer or senior
manager of DBC, as such knowledge exists on the date of this Agreement and no
later date, after reasonable review of DBC's records.
Employment Arrangement shall mean, with respect to DBC, any employment,
consulting, retainer, severance or similar contract, agreement, plan,
arrangement or policy (exclusive of any which is terminable within thirty (30)
days without liability, penalty or payment of any kind by DBC or any Affiliate),
or providing for severance, termination payments, insurance coverage (including
any self-insured arrangements), workers compensation, disability benefits, life,
health, medical, dental or hospitalization benefits, supplemental unemployment
benefits, vacation or sick leave benefits, pension or retirement benefits or for
deferred compensation, profit-sharing, bonuses, stock options, stock purchase or
appreciation rights or other forms of incentive compensation or post-retirement
insurance, compensation or post-retirement insurance, compensation or benefits,
or any collective bargaining or other labor agreement, whether or not any of the
foregoing is subject to the provisions of ERISA, but only to the extent that it
covers or relates to any officer, employee or other Person involved in the
ownership or operation of the DBC Assets or the conduct of the DBC Business.
Encumber shall mean to suffer, accept, agree to or permit the
imposition of a Lien.
Entity shall mean any corporation, firm, unincorporated organization,
association, partnership, limited liability company, trust (inter vivos or
testamentary), estate of a deceased, insane or incompetent individual, business
trust, joint stock company, joint venture or other organization, entity or
business, whether acting in an individual, fiduciary or other capacity, or any
Authority.
Environmental Law shall mean any Law relating to or otherwise imposing
liability or standards of conduct concerning pollution or protection of the
environment, including without limitation Laws relating to emissions,
discharges, releases or threatened releases of Hazardous Materials or other
chemicals or industrial pollutants, substances, materials or wastes into the
environment (including, without limitation, ambient air, surface water, ground
water, mining or reclamation or mined land, land surface or subsurface strata)
or otherwise relating to the manufacture, processing, generation, distribution,
use, treatment, storage, disposal, cleanup, transport or handling of pollutants,
contaminants, chemicals or industrial, toxic or hazardous substances, materials
or wastes. Environmental Laws shall include without limitation the Comprehensive
Environmental Response, Compensation and Liability Act (42 U.S.C. Section 6901
et seq.), the Hazardous Material Transportation Act (49 U.S.C. Section 1801 et
seq.), the Resource Conservation and Recovery Act (42 U.S.C. Section 6901 et
seq.), the Federal Water Pollution Control Act (33 U.S.C. Section 1251 et seq.),
the Clean Air Act (42 U.S.C. Section 7401 et seq.), the Toxic Substances Control
Act (15 U.S.C. Section 2601 et seq.), the Occupational Safety and Health Act (29
U.S.C. Section 651 et seq.), the Federal Insecticide Fungicide and Rodenticide
Act (7 U.S.C. Section 136 et seq.), and the Surface Mining Control and
Reclamation Act of 1977 (30 U.S.C. Section 1201 et seq.), and any analogous
federal, state, local or foreign, Laws, and the rules and regulations
promulgated thereunder all as from time to time in effect, and
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any reference to any statutory or regulatory provision shall be deemed to be a
reference to any successor statutory or regulatory provision.
Environmental Permit shall mean any Governmental Authorization required
by or pursuant to any Environmental Law.
ERISA shall mean the Employee Retirement Income Security Act of 1974,
and the rules and regulations thereunder, all as from time to time in effect, or
any successor law, rules or regulations, and any reference to any statutory or
regulatory provision shall be deemed to be a reference to any successor
statutory or regulatory provision.
ERISA Affiliate shall mean any Person that is treated as a single
employer with DBC under Sections 414(b), (c), (m) or (o) of the Code or Section
4001(b)(1) of ERISA.
Event shall mean the existence or occurrence of any act, action,
activity, circumstance, condition, event, fact, failure to act, omission,
incident or practice, or any set or combination of any of the foregoing.
FCA shall mean the Communication Act of 1934, and the rules and
regulations thereunder, all as from time to time in effect, or any successor
law, rules or regulations, and any reference to any statutory or regulatory
provision shall be deemed to be a reference to any successor statutory or
regulatory provision.
FCC shall mean the Federal Communications Commission and shall include
any successor Authority.
GAAP shall mean means, except to the extent that a deviation therefrom
is expressly required by this Agreement, such principles applied on a consistent
basis, (i) as set forth in Opinions of the Accounting Principles Board of the
American Institute of Certified Public Accountants ("AICPA") and/or in
statements of the Financial Accounting Standards Board that are applicable in
the circumstances as of the date in question, (ii) when not inconsistent with
such opinions and statements, as set forth in other AICPA publications and
guidelines and/or (iii) that otherwise arise by custom for the particular
industry, all as the same shall exist on the date of this Agreement.
Governmental Authorizations shall mean all approvals, concessions,
consents, franchises, licenses, permits, plans, registrations and other
authorizations of all Authorities, including without limitation the United
States Forest Service and the Federal Aviation Administration, in connection
with the ownership or operation of the DBC Assets or the conduct of the DBC
Business.
Governmental Filings shall mean all filings, including franchise and
similar Tax filings, and the payment of all fees, assessments, interest and
penalties associated with such filings, with all Authorities.
Hazardous Materials shall mean and include any substance, material,
waste, constituent, compound, chemical, natural or man-made element or force (in
whatever state of matter): (a) the presence of which requires investigation or
remediation under any Environmental Law, or (b) that is defined as a "hazardous
waste" or "hazardous substance" under any Environmental Law; or (c) that is
toxic, explosive, corrosive, etiologic, flammable, infectious, radioactive,
carcinogenic, mutagenic or otherwise hazardous and is regulated by any
applicable Authority or subject to any Environmental Law; or (d) the presence of
which on the real property owned or leased by such Person causes or threatens to
cause a nuisance upon any such real property or to adjacent properties or poses
or threatens to pose a hazard to the health or safety of persons on or about any
such real property; or (e) the presence of which on adjacent properties could
constitute a trespass by such Person; or (f) that contains gasoline, diesel fuel
or other petroleum hydrocarbons, or any by-products or fractions thereof,
natural gas, polychlorinated biphenyls ("PCBs") and PCB-containing equipment,
radon or
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other radioactive elements, ionizing radiation, electromagnetic field radiation
and other non-ionizing radiation, sonic forces and other natural forces, lead,
asbestos or asbestos-containing materials ("ACM"), or urea formaldehyde foam
insulation.
Indebtedness shall mean, with respect to any Person, (a) all items,
except items of capital stock or of surplus or of general contingency or
deferred tax reserves or any minority interest in any Subsidiary of such Person
to the extent such interest is treated as a liability with indeterminate term on
the consolidated balance sheet of such Person, which in accordance with GAAP
would be included in determining total liabilities as shown on the liability
side of a balance sheet of such Person, (b) all obligations secured by any Lien
to which any property or asset owned or held by such Person is subject, whether
or not the obligation secured thereby shall have been assumed, and (c) to the
extent not otherwise included, all Contractual Obligations of such Person
constituting capitalized leases and all obligations of such Person with respect
to Leases constituting part of a sale and leaseback arrangement.
Indebtedness for Money Borrowed shall mean, with respect to DBC, money
borrowed and Indebtedness represented by notes payable and drafts accepted
representing extensions of credit, all obligations evidenced by bonds,
debentures, notes or other similar instruments, the maximum amount currently or
at any time thereafter available to be drawn under all outstanding letters of
credit issued for the account of such Person, all Indebtedness upon which
interest charges are customarily paid by such Person, and all Indebtedness
(including capitalized lease obligations) issued or assumed as full or partial
payment for property or services, whether or not any such notes, drafts,
obligations or Indebtedness represent Indebtedness for money borrowed, but shall
not include (a) trade payables, (b) expenses accrued in the ordinary course of
business, (c) customer advance payments and customer deposits received in the
ordinary course of business, or (d) conditional sales agreements not prohibited
by the terms of this Agreement.
Indemnity Agreement shall have the meaning given to it in Section
5.2(h).
Intangible Assets shall mean all assets and property lacking physical
properties the evidence of ownership of which must customarily be maintained by
independent registration, documentation, certification, recordation or other
means, and shall include, without limitation, concessions, copyrights,
franchises, license, patents, permits, service marks, trademarks, trade names,
and applications with respect to any of the foregoing, technology and know-how.
Intellectual Property shall mean the following, but solely and
exclusively to the extent it relates to the DBC Business, and not otherwise: any
and all research, information, inventions, designs, procedures, developments,
discoveries, improvements, patents and applications therefor, trademarks and
applications therefor, service marks, trade names, copyrights and applications
therefor, logos, trade secrets, drawing, plans, systems, methods,
specifications, computer software programs, tapes, discs and related data
processing software (including without limitation object and source codes) owned
by such Person or in which it has an ownership interest and all other
manufacturing, engineering, technical, research and development data and
know-how made, conceived, developed and/or acquired by such Person, which relate
to the manufacture, production or processing of any products developed or sold
by such Person or which are within the scope of or usable in connection with
such Person's business as it may, from time to time, hereafter be conducted or
proposed to be conducted.
Law shall mean any (a) administrative, judicial, legislative or other
action, code, consent decree, constitution, decree, directive, enactment,
finding, guideline, law, injunction, interpretation, judgment, order, ordinance,
policy statement, proclamation, promulgation, regulation, requirement, rule,
rule of law, rule of public policy, settlement agreement, statute, or writ of
any Authority, domestic or foreign; (b) the common law, or other legal or
quasi-legal precedent; or (c) arbitrator's, mediator's or referee's award,
decision, finding
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or recommendation; including, in each such case or instance, any interpretation,
directive, guideline or request, whether or not having the force of law
including, in all cases, without limitation any particular section, part or
provision thereof.
Lease shall mean any lease of property, whether real, personal or
mixed, and all amendments thereto.
Legal Action shall mean, with respect to any Person, any and all
litigation or legal or other actions, arbitrations, counterclaims,
investigations, proceedings, requests for material information by or pursuant to
the order of any Authority or suits, at law or in arbitration, equity or
admiralty, whether or not purported to be brought on behalf of such Person,
affecting such Person or any of such Person's business, property or assets.
Lien shall mean any of the following: mortgage; lien (statutory or
other); or other security agreement, arrangement or interest; hypothecation,
pledge or other deposit arrangement; assignment; charge; levy; executory
seizure; attachment; garnishment; encumbrance (including any easement,
exception, reservation or limitation, right of way, and the like); conditional
sale, title retention or other similar agreement, arrangement, device or
restriction; preemptive or similar right; any financing lease involving
substantially the same economic effect as any of the foregoing; the filing of
any financing statement under the Uniform Commercial Code or comparable law of
any jurisdiction; restriction on sale, transfer, assignment, disposition or
other alienation; or any option, equity, claim or right of or obligation to, any
other Person, of whatever kind and character.
Loss and Expense shall have the meaning given to it in Section 6.2.
material, materially or materiality for the purposes of this Agreement,
shall, unless specifically stated to the contrary, be determined without regard
to the fact that various provisions of this Agreement set forth specific dollar
amounts.
Material Agreement shall mean, with respect to DBC, any Contractual
Obligation which (a) was not entered into in the ordinary course of business,
(b) was entered into in the ordinary course of business which (i) involved the
purchase, sale or lease of goods or materials, or purchase of services,
aggregating more than $20,000 during any of the last three fiscal years, (ii)
extends for more than three (3) months, or (iii) is not terminable on thirty
(30) days or less notice without penalty or other payment, (c) involves a
capitalized lease obligation or Indebtedness for Money Borrowed, (d) is or
otherwise constitutes a written agency, broker, dealer, license,
distributorship, sales representative or similar written agreement, (e)
accounted for more than three percent (3%) of the revenues of the DBC Business
in any of the last three fiscal years or is likely to account for more than
three percent (3%) of revenues of the DBC Business during the current fiscal
year, (f) is with the United States Forest Service or any other Authority, or
(g) involves the management by DBC of any communication tower of any other
Person.
Multiemployer Plan shall mean a Plan which is a "multiemployer plan"
within the meaning of Section 4001(a)3 of ERISA.
Organic Document shall mean, with respect to a Person which is a
corporation, its charter, its by-laws and all shareholder agreements, voting
trusts and similar arrangements applicable to any of its capital stock and, with
respect to a Person which is a partnership, its agreement and certificate of
partnership, any agreements among partners, and any management and similar
agreements between the partnership and any general partners (or any Affiliate
thereof).
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PBGC shall mean the Pension Benefit Guaranty Corporation and any Entity
succeeding to any or all of its functions under ERISA.
Permitted Liens shall mean (a) Liens for current taxes not yet due and
payable, (b) such imperfections of title, easements, encumbrances and mortgages
or other Liens, if any, as are not, individually or in the aggregate,
substantial in character, amount or extent and do not materially detract from
the value, or materially interfere with the present use, of the property subject
thereto or affected thereby, or otherwise materially impair the conduct of the
DBC Business, and (c) such other Liens as are permitted by the provisions of
this Agreement to be in place on the Closing Date.
Person shall mean any natural individual or any Entity.
Personal Property shall mean all of the machinery, equipment, tools,
vehicles, furniture, leasehold improvements, office equipment, plant, inventory,
spare parts and other tangible personal property which are owned or leased by
DBC and used or useful as of the date hereof in the conduct of the business or
operations of the DBC Business, plus such additions thereto and deletions
therefrom arising in the ordinary course of business between the date hereof and
the Closing Date.
Plan shall mean, with respect to any Person and at a particular time,
any employee benefit plan which is covered by ERISA and in respect of which such
Person or an ERISA Affiliate is (or, if such plan were terminated at such time,
would under Section 4069 of ERISA be deemed to be) an "employer" as defined in
Section 3(5) of ERISA, but only to the extent that it covers or relates to any
officer, employee or other Person involved in the ownership and operation of the
Assets or the conduct of the business of the DBC Business.
Prepaid Expense shall mean any item which in accordance with GAAP would
be treated as an expense and which has been paid by DBC prior to the Closing and
relates to a period subsequent to the Closing.
Prepaid Revenue shall mean any item which in accordance with GAAP would
be treated as revenue and which has been received by DBC prior to the Closing
and relates to a period subsequent to the Closing.
Private Authorizations shall mean all approvals, concessions, consents,
franchises, licenses, permits, and other authorizations of all Persons (other
than Authorities) including without limitation those with respect to
Intellectual Property.
Pro Ratable Taxes shall mean real estate and other property Taxes, ad
valorem Taxes, gross receipts Taxes and similar Taxes, but shall not include
federal, state or local income Taxes, franchise Taxes or other Taxes measured by
or based upon income or gain on sale or other disposition of property or assets.
Purchase Price shall have the meaning given to it in Section 2.3.
Regulations shall mean the federal income tax regulations promulgated
under the Code, as such Regulations may be amended from time to time. All
references herein to specific sections of the Regulations shall be deemed also
to refer to any corresponding provisions of succeeding Regulations, and all
references to temporary Regulations shall be deemed also to refer to any
corresponding provisions of final Regulations.
Subsidiary shall mean, with respect to a Person, any Entity a majority
of the capital stock ordinarily entitled to vote for the election of directors
of which, or if no such voting stock is outstanding, a majority of the equity
interests of which, is owned directly or indirectly, legally or beneficially, by
such Person or any other Person controlled by such Person.
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Tax (and "Taxable", which shall mean subject to Tax), shall mean, with
respect to any Person, (a) all taxes (domestic or foreign), including without
limitation any income (net, gross or other including recapture of any tax items
such as investment tax credits), alternative or add-on minimum tax, gross
income, gross receipts, gains, sales, use, leasing, lease, user, ad valorem,
transfer, recording, franchise, profits, property (real or personal, tangible or
intangible), fuel, license, withholding on amounts paid to or by such Person,
payroll, employment, unemployment, social security, excise, severance, stamp,
occupation, premium, environmental or windfall profit tax, custom, duty or other
tax, or other like assessment or charge of any kind whatsoever, together with
any interest, levies, assessments, charges, penalties, addition to tax or
additional amount imposed by any Taxing Authority, (b) any joint or several
liability of such Person with any other Person for the payment of any amounts of
the type described in (a) and (c) any liability of such Person for the payment
of any amounts of the type described in (a) as a result of any express or
implied obligation to indemnify any other Person.
Tax Claim shall mean any Claim which relates to Taxes, including
without limitation the representations and warranties set forth in Section 3.11.
Tax Return or Returns shall mean all returns, consolidated or otherwise
(including without limitation information returns), required to be filed with
any Authority with respect to Taxes.
Taxing Authority shall mean any Authority responsible for the
imposition of any Tax.
Transactions shall mean the transactions contemplated to be consummated
on or prior to the Closing Date, including without limitation the purchase and
sale of the DBC Assets and the DBC Business and the execution, delivery and
performance of the Collateral Documents.
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