ASSET PURCHASE AGREEMENT dated as of February 28, 2007 by and among DIGITAL COMMUNICATION SERVICES, INC., the Shareholders of Digital Communication Services, Inc., and J&J LEASING PARTNERSHIP, a Texas General Partnership, the partners of J&J Leasing...
Exhibit
10.1
dated
as
of February 28, 2007
by
and
among
DIGITAL
COMMUNICATION SERVICES, INC.,
the
Shareholders of Digital Communication Services, Inc.,
and
J&J
LEASING PARTNERSHIP, a Texas General Partnership,
the
partners of J&J Leasing Partnership,
and
BCI
COMMUNICATIONS, INC.
THIS
ASSET PURCHASE AGREEMENT, dated as of February 28, 2007 (this “Agreement”), is
made by and among DIGITAL COMMUNICATION SERVICES, INC, a Texas corporation,
J&J LEASING PARTNERSHIP, a Texas general partnership, (collectively, the
“Companies”), Xxx Xxxxxx, an individual domiciled in Texas, Xxxx Xxxx, an
individual domiciled in Texas, who are collectively the sole shareholders and
partners of the Companies (the “Shareholders”), and BCI COMMUNICATIONS, INC, a
Delaware corporation (“Purchaser”), and the wholly owned subsidiary of Berliner
Communications, Inc. (“Berliner”).
WHEREAS,
the Companies desire to sell to Purchaser, and Purchaser desires to purchase
from the Companies, all of the Companies’ right, title and interest to the
Companies’ Transferred Assets (as defined herein), which include the Companies’
business and various assets, and in connection therewith Purchaser is willing
to
assume the Companies’ Assumed Liabilities (as defined herein); and
WHEREAS,
as an inducement and condition to Purchaser’s entering into this Agreement, the
Shareholders, who are now employees of the Companies, are, concurrently with
the
execution and delivery of this Agreement, entering into employment agreements
with Purchaser (the “Employment Agreements”); and
NOW,
THEREFORE, in consideration of the foregoing and the respective representations,
warranties, covenants, agreements and conditions hereinafter set forth, and
intending to be legally bound hereby, the parties hereto agree as
follows:
ARTICLE
I
SALE
AND PURCHASE OF ASSETS
AND
ASSUMPTION OF LIABILITIES
1.1 Certain
Definitions Related to the Companies’ Assets and Liabilities.
For the
purposes of this Agreement, the following terms shall have the meanings ascribed
to them below:
(a) “Companies
Retained Assets” shall mean the assets and properties of the Companies listed on
the Companies’ schedule of retained assets (the “Companies’ Retained Assets
Schedule”) attached to this Agreement.
(b) “Companies
Transferred Assets” shall mean all the assets and properties of the Companies
(i) including its business and various assets, (ii) including all of the assets
and properties listed on the Companies’ schedule of enumerated assets attached
to this Agreement (the “Companies Schedule of Enumerated Assets”), but (iii)
excluding the Companies Retained Assets.
(c) “Companies
Retained Liabilities” shall mean all of the debts, liabilities and obligations
of the Companies, excluding the Companies Assumed Liabilities, but including
(i)
those debts, liabilities and obligations listed on, or related to those listed
on, the schedule of the Companies’ retained liabilities (the “Companies Retained
Liability Schedule”) attached to this Agreement, and (ii) those debts,
liabilities and obligations arising under or related to any Employee Benefit
Plans (as defined herein) of the Companies, except for liabilities relating
to
Employee Benefit Plans that are to be assumed by or made the express
responsibility of Purchaser pursuant to the express terms of Section
4.5.
(d) “Companies
Assumed Liabilities” shall mean only
the
items
listed on the Companies’ schedule of assumed liabilities attached to this
Agreement (the “Companies Schedule of Assumed Liabilities”),
(e) “Initial
Cash Payment” shall mean (A) $2,000,000, less the amount equal to the Companies
Assumed Liabilities as defined herein.
(f) “Promissory
Note” shall mean a note in the amount of $1,750,000, with a term of three (3)
years, payable quarterly and bearing interest at a fixed rate equal to eight
and
one-quarter percent (8.25%) per annum. The Promissory Note shall be
substantially in the Form of the Promissory Note attached to this Agreement
as
Exhibit A, and will be secured by land and buildings purchased from J&J
Leasing Partners as evidenced by a Deed of Trust substantially in the form
attached hereto as Exhibit B.
(g)
“Warrant” shall mean a warrant to purchase 500,000 shares of BCI Communications,
Inc Common Stock, par value .00002, at an exercise price of $0.73 per share.
The
Warrant shall be substantially in the form of the Warrant attached to this
Agreement as Exhibit C.
1.2 Sale
and Purchase of the Companies Transferred Assets.
(a) Upon
the
terms and subject to the conditions contained herein, concurrent with the
execution and delivery of this Agreement, the Companies shall sell, transfer,
assign, convey and deliver to Purchaser all of the Companies’ right, title and
interest in all of the Companies Transferred Assets, in each case free and
clear
of all liens, mortgages, pledges, encumbrances, security interests, charges
or
other interests of other persons of every kind whatsoever, except for Permitted
Liens (as defined herein).
(b) Concurrently
with the execution and delivery of this Agreement, the Companies will deliver
to
Purchaser (i) such general warranty deeds, bills of sale with covenants of
general warranty, endorsements, assignments, consents and other good and
sufficient instruments of sale, transfer, assignment and conveyance, in form
and
substance satisfactory to Purchaser and its counsel, as shall be effective
to
vest in Purchaser good and marketable title to, and a valid and enforceable
legal interest in, each of the Companies Transferred Assets, (ii) all of the
Companies’ contracts, contract amendments, commitments, leases, books and
records and all other information related to the Companies Transferred Assets,
(iii) all financial and general corporate records of the Companies, and (iv),
such other documents, certificates and instruments as Purchaser may reasonably
request. In addition, the Companies and the Shareholders shall use their best
efforts to put Purchaser into actual possession and operating control of all
the
Companies Transferred Assets.
(c) Concurrently
with such sale, transfer, assignment, conveyance and delivery of the Companies
Transferred Assets, upon the terms and subject to the conditions of this
Agreement and in reliance upon the representations, warranties and covenants
of
the Companies and the Shareholders contained herein, Purchaser shall purchase
and accept all of the Companies’ right, title and interest, including but not
limited to any rights, claims and causes of actions against others, whether
or
not yet asserted, in the Companies Transferred Assets.
-2-
(d) Concurrently
with the execution and delivery of this Agreement and as an initial purchase
price for the Companies Transferred Assets, Purchaser shall pay to the
Companies, by wire transfer and in immediately available funds, the Initial
Cash
Payment, as well as deliver the Promissory Note, the Deed of Trust, and the
Warrant (the “Combined Initial Payment”).
1.3 Assumption
of the Companies Assumed Liabilities.
Concurrently with the execution and delivery of this Agreement, Purchaser shall
assume and shall agree to pay, perform and discharge, as and when due, the
Companies Assumed Liabilities and shall deliver to the Companies instruments
of
assumption or other documents in form and substance reasonably satisfactory
to
the Companies and its counsel to evidence such agreement and
assumption.
1.4 Contingent
Purchase Price Adjustment Related to Operating Results
(a) Purchaser
agrees to pay to Xxxxx Xxxxxx and Xxxxxxx Xxxx an additional contingent purchase
price of up to $1,000,000 (the “Aggregate Contingent Purchase Price”) in three
annual installments of $333,333.33 (each of which, the “Installment Sum”), if
and only if (i) certain performance objectives related to the combined operating
results of the Digital Communication Services, Inc. business and the now
existing operations of the Berliner Communications, Inc. business located in
Texas (together the “Texas Business”) are met and (ii) Messrs. Xxxxxx and Xxxx
are employed by Purchaser at the end of each Contingent Purchase Price Payment
Period unless terminated “Without Cause” as set forth below in Section 1.4(b).
The Texas Business operating results will be measured at the end of the twelve
month period beginning on the first day of March 2007, and on each of the
subsequent two anniversaries thereof (each such twelve-month period a
“Contingent
Purchase Price Payment Period”).
At
the end of each Contingent Purchase Price Payment Period, the Purchaser will
prepare financial statements for such period reflecting the operating results
of
the Texas Business (the “Actual Results”). Purchaser will compare the Actual
Results to the projected results presented on the Schedule of Projected
Financial Results attached hereto as Exhibit D (the “Projected Results”).
Provided that both the revenue and EBITDA (as defined below) reflected on the
Actual Results are no less than 80% of the Projected Results for the relevant
Contingent Purchase Price Payment Period, the Purchaser will pay the Installment
Sum to Xxxxx Xxxxxx and Xxxxxxx Xxxx within 30 days following the end of the
relevant Contingent Purchase Price Payment Period (the “Contingent Payment
Date”). If either gross revenue or EBITDA, calculated according to GAAP,
reflected on the Actual Results are less than 80% of the Projected Results,
no
portion of the Contingent Purchase Price shall be paid for such period and
the
right to earn the Installment Sum from that particular Contingent Purchase
Price
Payment Period will be forever lost. “EBITDA” shall mean earnings before
interest, taxes, depreciation and amortization as shown on the statement of
operations for each Contingent Purchase Price Payment Period. A termination
event that occurs after the Contingent Purchase Price Payment Period but before
the Contingent Payment Date shall not effect Purchaser’s obligation to make the
payment on any earned Installment Sum.
-3-
(b)
Notwithstanding the terms of Section 1.4 above, no Contingent Purchase Price
will be due or payable if both Messrs. Xxxxxx and Reiss are no longer employed
by the Purchaser on the last day of the Contingent Purchase Price Period,
unless
such termination resulted from a termination “Without Cause” as defined in their
respective Employment Agreements with the Purchaser. If either one of Messrs.
Xxxxxx or Reiss is no longer employed by the Purchase on the last day of
the
Contingent Purchase Price Period (and the termination was not a termination
“Without Cause” as defined in the his Employment Agreement), and the other is
still employed, then one-half of the Contingent Purchase Price shall be paid
to
the individual who is still employed with the Purchaser and nothing shall
be
paid to the other.
1.5 License
to Use Digitcom Name. For a period of one year from the date hereof, the
Companies grant to Purchaser a limited, exclusive license to use the name
“Digitcom” for or on invoices, letterhead, signage, or other marketing, press,
administrative or other uses as may be required in the ordinary course of
business.
ARTICLE
II
REPRESENTATIONS
AND WARRANTIES
OF
THE COMPANIES AND THE SHAREHOLDERS
Except
as
set forth in the applicable sections of the Companies’ Disclosure Schedule
attached hereto (the “Disclosure Schedule”), it being agreed that (a) a
disclosure in any one section of such Disclosure Schedule shall be deemed
disclosed in any other section of such disclosure if the relevance of such
disclosure to such other section is reasonably apparent, and (b) mere inclusion
of an item in the Disclosure Schedule as an exception to a representation or
warranty shall not be deemed an admission by the Companies or the Shareholders
that such item constitutes a material exception or a fact, event or circumstance
that would reasonably be expected to have Material Adverse Effect (as defined
herein), the Companies and the Shareholders, jointly and severally, represents
and warrants to Purchaser as follows:
2.1 Corporate
Organization.
The
Companies are corporations and/or partnerships duly organized, validly existing
and in good standing under the laws of their state of incorporation and/or
formation and have full corporate and/or partnership power and authority to
own
or lease their properties and assets and to carry on their business as it is
presently being conducted. The Companies are duly qualified or licensed in
the
State of Texas are in good standing in every jurisdiction where the character
of
its properties owned or leased or the nature of its activities makes such
qualification or license necessary.
-4-
2.2 No
Subsidiaries.
The
Companies have no subsidiaries and no interest, direct or indirect, in any
corporation, partnership, joint venture, limited liability company, business
trust or other business entity. In connection with the transactions contemplated
by this Agreement, Purchaser shall incur no liability or obligation of any
nature for any liability, debt, cost, expense or other obligation of any
corporation, partnership, joint venture, limited liability company, business
trust or other business entity (other than those disclosed in this Agreement
and
the schedules hereto) in which the Companies have an interest, direct or
indirect.
2.3 Certificate
of Incorporation; Bylaws.
(a) True
and
complete copies of the Certificate of Incorporation of Digital Services
Communications, Inc. and the Partnership Agreement of J&J Leasing
Partnership (the “Certificates of Incorporation”) are included in Section 2.3(a)
of the Disclosure Schedule.
(b) A
true
and complete copy of the Bylaws of Digital Services Communications, Inc. (the
“Bylaws”) are included in Section 2.3(b) of the Disclosure
Schedule.
2.4 Authorization.
Each of
the Shareholders and/or Partners and the Companies has the requisite power
(corporate or otherwise), capacity and authority to enter into this Agreement
and to consummate the transactions contemplated hereby. The execution, delivery
and performance of this Agreement and the consummation of the transactions
contemplated hereby have been duly authorized by the Board of Directors of
the
Companies and/or the General Partners and by the shareholders of the Companies,
and no additional proceedings (corporate or otherwise) on the part of the
Companies, their Board of Directors, any of its shareholders and/or General
Partners or, except as could not materially diminish the value to Purchaser
of
the transactions contemplated by this Agreement, any other person are necessary
to authorize the execution, delivery and performance of this Agreement and
the
consummation of the transactions contemplated hereby. This Agreement has been
duly executed and delivered and constitutes the valid and binding obligations
of
each of the Shareholders and/or General Partners the Companies, enforceable
against each of the Shareholders, General Partners and the Companies in
accordance with its terms.
2.5 Capitalization.
(a) All
Outstanding Target Shares are validly issued, fully paid and nonassessable
and
were not issued in violation of any preemptive or similar right. All of the
Outstanding Target Shares are owned by the Shareholders.
2.6 Noncontravention;
Consents; Filings.
The
execution, delivery and performance of this Agreement and the consummation
by
the Shareholders, General Partners and the Companies of the transactions
contemplated hereby and compliance by the Shareholders. General Partners and
the
Companies with the provisions hereof do not and will not (a) conflict with
or
violate any provision of the Certificate of Incorporation or Bylaws of either
of
the Companies, (b) require any filing with, or the permit, authorization,
consent or approval of, any court, arbitrator or arbitral tribunal,
administrative agency or commission or other governmental or regulatory
authority or agency (a “Governmental Entity”), (c) conflict with or violate any
order, writ, injunction, decree, statute, rule or regulation applicable to,
binding upon or enforceable against either the Shareholders or the Companies
or
any of their respective properties or assets, (d) constitute a breach of any
duty owed by the Shareholders or any other person acting in a representative
or
fiduciary capacity with respect to any shareholder or any person with any
beneficial interest in either of the Companies or any shareholder of the
companies, or (e) create any lien, charge, encumbrance, security interest,
claim
or right of others on or with respect to any Transferred Asset, or (f)
materially diminish the value of the transactions contemplated by this Agreement
to Purchaser, result in a violation or breach of, or constitute (with or without
notice or lapse of time or both) a default or give rise to any right of
termination, amendment, cancellation or acceleration under, or result in the
creation or imposition of any lien, charge, encumbrance, security interest,
claim or right of others of whatever nature upon any property or assets of
any
of the Shareholders or the Companies under, any note, bond, mortgage, indenture,
lease, license, contract, agreement, or other instrument or obligation to which
either the Shareholders or the Companies are a party or by which any of the
Shareholders, the Companies or any of their respective properties or assets
may
be bound.
-5-
2.7 Financial
Statements.
Section
2.7(a) of the Disclosure Schedule sets forth the audited balance sheets of
the
Companies as at December 31, 2005, and 2004, and the unaudited financial
statements through the month ended December 31, 2006, and the related audited
statements of operations, stockholders’ equity or deficit and cash flows for the
periods then ended. The balance sheet of the Companies as of December 31, 2006
is referred to in this Agreement as the “2006 Balance Sheet.” Such financial
statements (i) are true and complete in all material respects, and (ii) have
been prepared in accordance with GAAP applied on a consistent basis. Each of
the
balance sheets of the Companies referred to in this Section 2.7 reflects, as
of
the dates thereof, all claims against and all debts and liabilities of the
Companies, fixed or contingent, as at the date thereof, required to be shown
thereon under GAAP, and the related statements of operations, stockholders’
equity or deficit and cash flows fairly present the results of operations,
the
stockholders’ equity or deficit and cash flows of the Companies for the
respective periods indicated.
2.8 Books
and Records.
All
accounts, books and ledgers of the Companies have been properly and accurately
kept and completed in all material respects, and there are no material
inaccuracies or material discrepancies of any kind contained or reflected
therein. The Companies have none of its records, systems controls, data or
information recorded, stored, maintained, operated or otherwise wholly or partly
dependent on or held by any means (including any electronic, mechanical or
photographic process, whether computerized or not) which (including all means
of
access thereto and therefrom) are not under the exclusive ownership (excluding
licensed software programs) and direct control of the Companies.
2.9 No
Undisclosed Liabilities.
As of
the date of the 2006 Balance Sheet, except as set forth in Section 2.9 of the
Disclosure Schedule, the Companies have no debt, liability or obligation of
any
nature (absolute, accrued, contingent or otherwise) that is not fully reflected
on or reserved against in the 2006 Balance Sheet.
-6-
2.10 Interim
Changes.
Except
as set forth in Section 2.10 of the Disclosure Schedule, since the date of
the
2006 Balance Sheet, the Companies have been operated only in the ordinary course
of business consistent with past practice in all respects, and the Companies
have not:
(a) suffered
any changes, nor has there occurred or arisen any events, facts, circumstances
or conditions, that have had or could reasonably be expected to have, either
singly or in the aggregate, a material adverse effect on the business,
operations, condition (financial or otherwise), properties, liabilities, client
relations, or prospects of the Companies or on any Transferred Assets listed
on
the Schedule of Enumerated Assets (a “Material Adverse Effect”) or to materially
diminish the value to Purchaser of the transactions contemplated
hereby;
(b) made
any
capital expenditures which are more than $20,000 individually or $50,000 in
the
aggregate;
(c) employed,
engaged or entered into any new contract with or amended any existing contract
for the employment of, any person by the Companies or increased the compensation
or benefits of any employee of the Companies;
(d) sold,
assigned, transferred, conveyed, leased or otherwise disposed of or agreed
to
sell, assign, transfer, convey, lease or otherwise dispose of any portion of
its
properties or assets, except in the ordinary course of business and consistent
with past practice in all respects;
(e) suffered
any damage, destruction or loss of property related to the Companies, whether
or
not covered by insurance;
(f) declared,
paid or set aside for payment any dividend or other distribution (whether in
cash, stock or property or any combination thereof), directly or indirectly,
in
respect of the Companies’ capital stock or other securities;
(g) made
any
change in its accounting principles or methods;
(h) written
down the value of any inventory (including write-downs by reason of shrinkage
or
xxxx-down) or assets or written off as uncollectible any notes or accounts
receivable, except for such write-downs or write-offs in the ordinary course
of
business consistent with past practice in all respects, nor suffered any change
or experienced any condition which would require any such write-down or
write-off;
(i) paid,
loaned or advanced any amount, other than advances to employees for travel
and
entertainment expenses in the ordinary course of business and consistent with
past practice in all respects, or sold, transferred or leased any properties
or
assets (real, personal or mixed, tangible or intangible), other than properties
or assets of nominal value, to any of its employees, officers or directors
or
any affiliate or associate of any of its employees, officers or directors;
or
(j) agreed,
whether in writing or otherwise, to take any action described in this Section
2.10.
-7-
2.11 Litigation.
There
is no action, suit or proceeding by or before any Governmental Entity pending
nor, to the Actual Knowledge (as defined herein) of the Shareholders and the
Companies or which could have been discovered through reasonable investigation,
threatened, against or involving the Shareholders or the Companies, or affecting
any properties or assets of any of the Shareholders or the Companies. Neither
the Shareholders nor the Companies are aware of any reasonable basis for any
such claim, action, suit, inquiry, proceeding or investigation. Neither the
Shareholders nor the Companies are subject to any order, writ, injunction or
decree which could reasonably be expected to impair the ability of either the
Shareholders or the Companies to consummate the transactions contemplated hereby
or diminish the value of the transactions contemplated by this Agreement to
Purchaser.
2.12 No
Violation.
(a) The
Companies are not in violation or breach of, or in default under (and no event
has occurred which with notice or lapse of time or both would constitute such
a
breach, violation or default or give rise to any right of termination,
amendment, cancellation or acceleration under) any term, condition or provision
of (i) the Certificate of Incorporation or Bylaws of the Companies, (ii) any
order, writ, injunction, decree, statute, rule or regulation applicable to
the
Companies or any of its properties, assets or business or (iii) any note, bond,
mortgage, indenture, lease, license, contract, agreement or other instrument
or
obligation to which the Companies are a party or by which the Companies or
any
of its properties or assets may be bound.
(b) The
Shareholders and the Companies have obtained all permits, authorizations,
consents or approvals and made all notifications and applications to
Governmental Entities required under applicable law necessary to conduct
business as heretofore conducted which, if not obtained or made, could
reasonably be expected to (i) impair the ability of the Shareholders or the
Companies to consummate the transactions contemplated hereby or (ii) in the
aggregate have a Material Adverse Effect on the business of the Companies or
materially diminish the value of the transactions contemplated by this Agreement
to Purchaser.
2.13 Title
to Properties; Encumbrances.
Except
as set forth in Section 2.6 of the Disclosure Schedule or in Section 2.15(a)
of
the Disclosure Schedule with respect to Intellectual Property (as defined
herein), the Companies have good, marketable and valid title to all Transferred
Assets listed on the Schedule of Enumerated Assets. Except as set forth in
Section 2.6 of the Disclosure Schedule or in Section 2.15(a) of the Disclosure
Schedule with respect to Intellectual Property, the Companies have good,
marketable and valid title to all Transferred Assets. Except as set forth in
Section 2.6 of the Disclosure Schedule or in Section 2.15(a) of the Disclosure
Schedule with respect to Intellectual Property, all Transferred Assets are
free
and clear of all title defects or objections, liens, claims, charges, security
interests or other encumbrances of any nature whatsoever. Upon the consummation
of the transactions contemplated by this Agreement, the Companies will deliver,
and Purchaser shall receive, good, marketable and valid title to all Transferred
Assets. With respect to any real property transferred to Purchaser, such
property is held by J&J Leasing Partners free and clear of all liens, rights
of way, easements, restrictions, exceptions, variances, reservations, covenants
or other imperfections of title, if any, that do not materially detract from
the
value of or materially interfere with the present use of the property affected
thereby.
-8-
2.14 Condition
and Sufficiency of Assets.
(a) Each
of
the tangible Transferred Assets is in good condition (ordinary wear and tear
excepted) and is suitable for use in the business of the Companies as such
business has historically been conducted.
(b) The
Companies’ schedule of Enumerated Assets contains,
(i) in
Section 2.14(b)(i) thereof, a true and complete list of all real property owned
by the Companies or in which the Companies have an interest, other than
leases;
(ii) in
Section 2.14(b)(ii) thereof, a true and complete list of all leases under which
the Companies lease any real property;
(iii) in
Section 2.14(b)(iii) thereof, a true and complete list of all property other
than real property or Intellectual Property owned by Companies, including but
not limited to equipment, furniture and machinery;
(iv) in
Section 2.14(b)(iv) thereof, a true and complete list of all leases under which
the Companies lease any property other than real property that is material
to
the Companies’ business;
(v) in
Section 2.14(b)(v) thereof, a true and complete list of all contracts to which
the Companies are a party and that are material to its business
(vi) in
Section 2.14(b)(vi) thereof, a true and complete list of all Intellectual
Property (as defined herein) used by the Companies, including a list of all
trademarks, tradenames, service marks or service names used by the Companies
or
in which the Companies have an interest;
(vii) in
Section 2.14(b)(vii) thereof, a true and complete list, as of the date hereof,
of all accounts receivable of the Companies, including, with respect to each
such account receivable, the amount due thereunder to the
Companies;
(viii) in
Section 2.14(b)(viii) thereof, a true and complete list of the Companies’
Material inventory, all consigned inventory, and a general description of all
inventory not deemed Material to the satisfaction of Purchaser as of the date
hereof;
(ix) in
Section 2.14(b)(ix) thereof, a true and complete list of all insurance policies
under which the Companies are an insured person or otherwise has a beneficial
interest; and
(x) in
Section 2.14(b)(x) thereof, a true and complete list of all governmental and
commercial licenses, permits, authorizations and otherwise pertaining to the
Companies’ business, both: 1) those that the Companies currently have, or 2)
those that are required to conduct the Companies’ business in its ordinary
course, and an indication of whether or not such licenses are currently
effective, and
-9-
(xi) in
Section 2.14(xi) thereof, a true and complete list of all other assets or
properties of the Companies, of whatever nature, that are (A) material to the
business of the Companies, and (B) are not listed elsewhere on the Companies’
Schedule of Enumerated Assets.
(c) The
Transferred Assets comprise all of the Companies’ assets and properties used in
the conduct of its business and are sufficient to continue to carry such
business in the same manner in all respects as it has historically been
conducted by the Companies.
2.15 Intellectual
Property.
Except
as set forth in Section 2.15(a) of the Disclosure Schedule, the Companies have
all right, title and interest in, or a valid and binding license to use, all
Intellectual Property (as defined herein) that is a part of the Transferred
Assets. Except as set forth in Section 2.15(a) of the Disclosure Schedule,
no
claim of infringement or misappropriation arising from the use of Intellectual
Property that is part of the Transferred Assets is or has been made or is or
has
been threatened to be made in writing or, to the Best Knowledge of the Companies
and the Shareholders and General Partners, is or has been threatened to be
made
orally against either of the Companies, and, except as set forth in Section
2.15(a) of the Disclosure Schedule, to the Best Knowledge of the Companies,
the
Shareholders and the General Partners, the Companies are not infringing or
misappropriating any Intellectual Property of any other person or entity in
the
Companies’ use of any Intellectual Property that is part of the Transferred
Assets. The Companies have granted no license, franchise or permit in effect
on
the date hereof to any person or entity to use any Intellectual Property that
forms a part of the Transferred Assets. As used herein, “Intellectual Property”
shall mean patents and patent rights, copyrights and copyright rights, and
other
proprietary intellectual property, trade secrets, and proprietary information,
as well as all pending applications for, and registrations rights of, any of
the
foregoing.
2.16 Leases.
Section
2.16 of the Disclosure Schedule contains a summary, accurate in all respects,
of
the terms of all leases pursuant to which the Companies lease real property,
including but not limited to assignment rights and claims to such property,
whether or not asserted, or pursuant to which the Companies lease personal
property and which provide for lease payments in excess of $10,000 during any
twelve-month period. All such leases are valid, binding and enforceable against
the Companies and, to the Actual Knowledge of the Shareholders and the
Companies, any other party thereto in accordance with their terms, and are
in
full force and effect. There are no existing defaults by the Companies
thereunder, and the Companies are not in breach, violation or default (and
no
event which with the giving of notice or the passage of time or both would
constitute such a breach, violation or default or give rise to any right of
termination, amendment, renegotiation, cancellation or acceleration)
thereunder.
2.17 Bank
Accounts.
Section
2.17 of the Disclosure Schedule sets forth the names and locations of all banks,
trust companies, savings and loan associations and other financial institutions
at which the Companies maintain safe deposit boxes or accounts of any nature
and
the names of all persons authorized to draw thereon, make withdrawals therefrom
or have access thereto.
2.18 Taxes.
(a) All
Returns (as defined herein) required to be filed (taking into account
extensions) on or before the date hereof for Taxes (as defined herein) properly
attributable to periods ending on or before the date hereof by, or with respect
to any activities of, or property owned by either of the Companies, have been
or
will be filed in accordance with all applicable laws and are or, with respect
to
Returns yet to be filed, will be, true, correct and complete in all material
respects as filed; all Taxes shown as due on such Returns have been or will
be
timely paid; and reserves reflected on the 2006 Balance Sheet are sufficient
to
cover all Taxes (whether or not shown as due on any Return) accrued as of the
dates thereof, respectively, and, adjusted for the passage of time, will be
sufficient to cover all Taxes as of the date hereof; (b) all Taxes required
to
be withheld by both Companies have been withheld, and such withheld Taxes have
either been duly and timely paid to the proper Taxing Authorities (as defined
herein) or set aside in accounts for such purpose if not yet due; (c) no Return
filed by the Shareholders, General Partners or the Companies is currently under
audit by any Taxing Authority or is the subject of any judicial or
administrative proceeding, and to the Best Knowledge of the Shareholders,
General Partners and the Companies, respectively, no Taxing Authority is
threatening to commence any such audit; (d) no Taxing Authority is now asserting
against the Companies any deficiency or claim for Taxes or any adjustment of
Taxes and no issue has been raised by any Taxing Authority in any examination
which, by application of the same or similar principles, could reasonably be
expected to result in a proposed deficiency for any period not so examined;
(e)
the Companies are not subject to or bound by any Tax sharing agreement (or
other
arrangement or practice for the sharing of Taxes); (f) the Companies have never
been a member of a consolidated group within the meaning of Section 1504 of
the
Code; (g) neither the Shareholders nor the Companies have waived any statute
of
limitations with respect to any Tax or agreed to any extension of time for
filing any Return that has not been filed, and neither the Shareholders nor
the
Companies have consented to extend the period in which any Tax may be assessed
or collected by any Taxing Authority; (h) there are no liens for Taxes (other
than Taxes not yet due) upon any of the assets of the Companies; (i) the
Companies have no liability under Treasury Regulation 1.1502-6 (or any similar
provision of state, local or foreign law) or any liability as a transferee
or
successor, by contract or otherwise, for the Taxes of any person other than
the
Companies; (j) all income tax Returns for the Companies in respect of all years
not barred by the statute of limitations have heretofore been delivered by
the
Companies to Purchaser and such Returns are true, correct, and complete in
all
material respects, and all such Returns are listed in Section 2.18 of the
Disclosure Schedule; (k) there are no outstanding powers of attorney enabling
any party to represent the Companies with respect to Tax matters; (l) no consent
under Section 341(f) of the Internal Revenue Code of 1986, as amended (together
with the rules and regulations promulgated thereunder, the “Code”) has been
filed with respect to the Companies; and (m) for all relevant federal and state
purposes, Digital Communication Services, Inc. has been an S corporation at
all
times since February 1, 1996.
-10-
2.19 Contracts
and Commitments.
(a) Section
2.19(a) of the Disclosure Schedule sets forth a complete and accurate list
of
all
(i) credit
agreements, notes, indentures, security agreements, pledges, guarantees of
or
agreements to assume any such debt obligation of others or similar documents
relating to indebtedness for borrowed money (including interest rate or currency
swaps, xxxxxx or straddles or similar transactions) to which the Companies
are a
party or by which any of its assets are bound, restricted or
encumbered;
-11-
(ii) employment,
consulting, severance or termination agreements which require or may require
the
Companies to pay (A) more than $100,000 in any twelve-month period, or (B)
any
severance or termination pay liability or obligation;
(iii) agreements
by or among the shareholders of the Companies relating to or affecting the
acquisition, disposition or voting of the capital stock of the
Companies;
(b) Except
as
set forth in Section 2.19(b) of the Disclosure Schedule,
(i) the
Companies do not have any contract which is material to its business, operations
or prospects;
(ii) no
purchase contract of either of the Companies continue for a period of more
than
twelve months or requires payment of more than $10,000 in any twelve-month
period;
(iii) no
Employee Benefit Plan contains any severance or termination pay liability or
obligation;
(iv) the
Companies have no employee to whom it is paying base salary at the annual rate
of more than $100,000 for services rendered;
(v) the
Companies are not restricted by any agreement from carrying on its business
in
any respect anywhere in the world;
(vi) the
Companies do not have any outstanding loan to any person, other than advances
to
employees for travel and entertainment expenses in the ordinary course of
business; and
(vii) the
Companies do not have any power of attorney outstanding or any obligation or
liability (whether absolute, accrued, contingent or otherwise), as surety,
co-signer, endorser, co-maker, indemnitor or otherwise in respect of the
obligation of any person, corporation, partnership, joint venture, limited
liability company, association, organization or other entity.
2.20 Client
Relations.
Except
as set forth in Section 2.20 of the Disclosure Schedule, since December 31,
2004, there has not been, and as of the date hereof, to the Actual Knowledge
of
the Companies and the Shareholders and General Partners, there exists no set
of
facts or circumstances that could reasonably be expected to result in, any
adverse change in the Company’s relations with any of its current clients,
whether as a result of the transactions contemplated by this Agreement or
otherwise, provided, however, it is understood and agreed that neither the
Companies nor the Shareholders or General Partners make any representation
or
warranty concerning such relations following the consummation of the
transactions contemplated by this Agreement. Section 2.20 of the Companies
Disclosure Schedule sets forth the names of the Companies 10 largest clients
(measured by the Companies revenues for the fiscal year ended December 31,
2006)
as of the date hereof, and the projected revenues of such largest clients and
of
all clients in the aggregate for the fiscal year ending December 31, 2006.
All
such projections were made in good faith and upon a reasonable basis, but no
representation or warranty is made that such projections will in fact be
achieved. No current client of the Companies has advised the Companies in
writing or otherwise that it is terminating or considering terminating the
handling of its business by the Companies as a whole or in respect of any
particular product, project or service, or is planning to reduce its future
spending with the Companies in any manner, but no representation or warranty
is
made that such a termination or reduction will not occur after the consummation
of the transactions contemplated hereby.
-12-
2.21 Insurance.
Section
2.21 of the Disclosure Schedule contains an accurate list and description by
type of all policies of fire, liability, workmen’s compensation and other forms
of insurance, including, but not limited to, all group insurance programs in
effect for the Companies’ employees, owned or held by the Companies. All such
policies are in full force and effect, all premiums due with respect thereto
covering all periods up to and including the date hereof have been paid, and
no
written notice of cancellation or termination has been received with respect
to
any such policy. Except as set forth in the Section 2.21 of the Disclosure
Schedule, (a) such policies are sufficient for compliance with all material
requirements of law and of all material agreements to which the Companies are
a
party, (b) are valid, outstanding and enforceable policies, (c) provide
insurance coverage for the assets and operations of the Companies that is
adequate in light of risks of the Companies’ business as heretofore conducted,
(d) will remain in full force and effect through the respective dates set forth
in Section 2.21 of the Disclosure Schedule without the payment of additional
premiums, and (e) will not in any way be affected by, or terminate or lapse
by
reason of, the transactions contemplated by this Agreement. The Companies have
not been refused any insurance with respect to its assets or operations, nor
has
its coverage been limited, by any insurance carrier to which it has applied
for
any such insurance or with which it has carried insurance.
2.22 Labor
Matters; Unions.
None of
the employees of either of the Companies is represented by a union in connection
with his or her employment by the Companies. No labor organization or group
of
employees of the Companies has made a pending demand for recognition or
certification, and there are no representation or certification proceedings
or
petitions seeking a representation proceeding presently pending or, to the
Actual Knowledge of the Companies and the Shareholders after inquiry of the
Companies’ personnel manager, threatened to be brought or filed with the
National Labor Relations Board or any other labor relations tribunal or
authority. There are no organizing activities, strikes, work stoppages,
slowdowns, lockouts, arbitrations or grievances, or other labor disputes pending
or, to the Actual Knowledge of the Companies and the Shareholders after inquiry
with the Companies personnel manager, threatened against the Companies or
involving the Companies employees. The Companies are in compliance in all
material respects with all applicable laws respecting employment and employment
practices, terms and conditions of employment, wages and hours and occupational
safety and health.
2.23 Compliance
With Law.
The
operations of the Companies have been conducted in accordance with all
applicable laws, regulations and other requirements of all national governmental
authorities, and of all states, municipalities and other political subdivisions
and agencies thereof, having jurisdiction over the Companies.
-13-
2.24 No
Filings With Securities and Exchange Commission.
The
Companies have had, during the past five years, no legal obligation to file
any
form, report, schedule, statement, proxy statement or other document or
information with the Securities and Exchange Commission, and during the same
period the Companies have not filed with the Securities and Exchange Commission
any such form, report, schedule, statement, proxy statement or other document
or
information.
2.25 Environmental
Matters.
(a) The
Companies are in compliance with all applicable Environmental Laws (as defined
herein), which compliance includes, but is not limited to, the possession by
the
Companies of all permits and other governmental authorizations required under
applicable Environmental Laws, and compliance with the terms and conditions
thereof. Neither the Shareholders nor the Companies has received any
communication (written or oral), whether from a governmental authority, citizens
group, public-interest or not-for-profit organization, employee or any other
person or entity, that alleges that the Companies are not in such compliance,
and, to the Best Knowledge of the Shareholders and the Companies, there are
no
circumstances that may prevent or interfere with such compliance in the
future.
(b) There
is
no Environmental Claim (as defined herein) pending or, to the Actual Knowledge
of the Shareholders or the Companies, threatened against the Companies, or
affecting any properties or assets of the Companies, or, to the Actual Knowledge
of the Companies and the Shareholders, against any person or entity whose
liability for any Environmental Claim the Companies have or may have retained
or
assumed either contractually or by operation of law.
(c) There
are
no past or present actions, activities, circumstances, conditions, events or
incidents, including the release, emission, discharge, presence or disposal
of
any Materials of Environmental Concern (as defined herein) having occurred
or
occurring during the periods when the Companies leased or owned any real
property, that could reasonably be expected to form the basis of any
Environmental Claim against the Companies or affecting any properties or assets
of the Companies, or, to the Actual Knowledge of the Companies or Shareholders,
against any person or entity whose liability for any Environmental Claim the
Companies have or may have retained or assumed either contractually or by
operation of law.
(d) For
the
purposes of this Agreement, “Environmental Claim” means any claim, action, cause
of action, investigation or notice (written or oral) by any person or entity
alleging potential liability (including potential liability for investigatory
costs, cleanup costs, governmental response costs, natural resources damages,
property damages, personal injuries, or penalties) arising out of, based on
or
resulting from (i) the presence, or release into the environment, of any
Materials of Environmental Concern at any location, whether or not owned or
operated by the Companies or (ii) circumstances forming the basis of any
violation, or alleged violation, of any Environmental Law.
(e) For
the
purposes of this Agreement, “Environmental Laws” means all federal, state, local
and foreign laws and regulations relating to pollution or protection of human
health or the environment (including ambient air, surface water, ground water,
land surface or subsurface strata), including laws and regulations relating
to
emissions, discharges, releases or threatened releases of Materials of
Environmental Concern, or otherwise relating to the manufacture, processing,
distribution, use, treatment, storage, disposal, transport or handling of
Materials of Environmental Concern.
-14-
(f) For
the
purposes of this Agreement, “Materials of Environmental Concern” means
chemicals, pollutants, contaminants, wastes, toxic substances, petroleum and
petroleum products.
2.26 Benefit
Plans; Compliance with ERISA.
(a) For
the
purposes of this Agreement, the following terms shall have the meanings set
forth below:
(i) “ERISA”
means the Employee Retirement Income Security Act of 1974, as
amended.
(ii) “Employee
Benefit Plan” means any employee benefit plan, program, policy, practices, or
other arrangement providing benefits to any current or former employee, officer
or director of the Companies or any beneficiary or dependent thereof that is
sponsored or maintained by the Companies or to which the Companies contribute
or
are obligated to contribute, whether or not written, including any employee
welfare benefit plan within the meaning of Section 3(1) of ERISA, any employee
pension benefit plan within the meaning of Section 3(2) of ERISA (whether or
not
such plan is subject to ERISA) and any bonus, incentive, deferred compensation,
vacation, stock purchase, stock option, severance, employment, change of control
or fringe benefit plan, program or agreement.
(b) Section
2.26(b) of the Disclosure Schedule contains a complete list of all Employee
Benefit Plans.
(c) With
respect to each Employee Benefit Plan, the Companies have delivered to Purchaser
a true, correct and complete copy of (i) each writing, if any, constituting
a
part of such Employee Benefit Plan, including all plan documents, trust
agreements, insurance contracts and other funding vehicles; and (ii) the current
summary plan description and any material modifications thereto, if any (in
each
case, whether or not required to be furnished under ERISA).
(d) Section
2.26(d) of the Disclosure Schedule identifies each Employee Benefit Plan that
is
intended to be a “qualified plan” within the meaning of Section 401(a) of the
Code (“Qualified Plans”) and each Qualified Plan and its related trust is
“qualified” within the meaning of Section 401(a) of the Code. No events have
occurred that could adversely affect the qualified status of any Qualified
Plan
or the related trust.
(e) All
contributions required to be made to any Employee Benefit Plan by applicable
law
or regulation or by any plan document or other contractual undertaking, and
all
premiums due or payable with respect to insurance policies funding any Employee
Benefit Plan, for any period through the date hereof, either (i) have been
timely made or paid in full or (ii) to the extent not required to be made or
paid on or before the date hereof, shall be disclosed to Purchaser as soon
as
practicable following the date hereof with the understanding that such amounts
shall be reflected on the Opening Balance Sheet.
-15-
(f) With
respect to each Employee Benefit Plan, the Companies have complied, and is
now
in compliance, in all material respects with all provisions of ERISA, the Code
and all laws and regulations applicable to such Employee Benefit Plans and
each
Employee Benefit Plan has been administered in all material respects in
accordance with its terms.
(g) Neither
of the Companies nor any other person, including any fiduciary, has engaged
in
any “prohibited transaction” (as defined in Section 4975 of the Code or Section
406 of ERISA), which could subject any of the Employee Benefit Plans or their
related trusts, the Companies or any person that the Companies have an
obligation to indemnify, to any tax or penalty imposed under Section 4975 of
the
Code or Section 502 of ERISA.
(h) For
purposes of this Section 2.26, the term “employee” shall be considered to
include individuals rendering personal services to the Companies as independent
contractors.
2.27 Brokers
and Finders.
None of
the Shareholders, the Companies, their officers, directors or employees has
employed any broker or finder or incurred any liability for any investment
banking fees, brokerage fees, commissions or finders’ fees in connection with
the transactions contemplated by this Agreement.
2.28 Personnel.
(a) Section
2.28(a) of the Disclosure Schedule sets forth a true and complete list of (i)
the names and current salaries of all directors, officers and employees of
the
Companies (the “Company Employees”) and the family relationships, if any, among
such persons, and (ii) a statement as to whether, on the date hereof, any such
employee is absent from employment due to illness, vacation, disability,
military service, or other authorized absence (each, an “Inactive
Employee”).
(b) Section
2.28(b) of the Disclosure Schedule sets forth a summary of the Companies’
policies concerning pay raises for officers and other employees of the
Companies.
2.29 Insider
Interests.
Except
as set forth in Section 2.29 of the Disclosure Schedule, no shareholder,
officer, director or employee of either of the Companies has any interest in
any
property, real or personal, tangible or intangible, including Intellectual
Property, used in or pertaining to the business of the Companies.
2.30
CPO’s
and other Contracts.
All
Customer Purchase Orders and other contracts for the sale of goods and services
reflected in the Schedule of Backlog of the Companies (as attached to this
Agreement as Schedule 2.31) are valid and will upon performance by the Companies
of these contracts and Customer Purchase Orders entitle the Companies to receive
the payments contemplated therein.
-16-
2.31 Disclosure.
No
representation or warranty made by the Companies or the Shareholders in this
Agreement and no statement contained in any document (including the Disclosure
Schedule) or certificate furnished or to be furnished by the Companies or the
Shareholders to Purchaser or any of its representatives pursuant to the
provisions hereof or in connection with the transactions contemplated hereby,
contains or will contain any untrue statement of a material fact or omits or
will omit to state a material fact necessary in order to make not misleading
in
any respect, in light of the circumstances under which it was made, any such
representation, warranty, statement or certificate.
ARTICLE
III
REPRESENTATIONS
AND WARRANTIES OF PURCHASER
Purchaser
hereby represents to the Companies and the Shareholders as follows:
3.1 Corporate
Organization.
Purchaser is an corporation duly organized, validly existing and in good
standing under the laws of the State of Delaware.
3.2 Authorization.
Purchaser has the requisite corporate power and authority to enter into this
Agreement and to consummate the transactions contemplated hereby. The execution,
delivery and performance of this Agreement and the consummation of the
transactions contemplated hereby have been duly authorized by an officer of
Purchaser, and no additional proceedings (corporate or otherwise) on the part
of
Purchaser, its boards of directors, stockholders or any other person are
necessary to authorize the execution, delivery and performance of this Agreement
and the consummation of the transactions contemplated hereby. This Agreement
has
been duly executed and delivered and constitutes the valid and binding
obligation of Purchaser, enforceable against Purchaser in accordance with its
terms.
3.3 Noncontravention;
Consents; Filings.
The
execution, delivery and performance of this Agreement by Purchaser and the
consummation by Purchaser of the transactions contemplated hereby and compliance
by Purchaser with any of the provisions hereof do not and will not (a) conflict
with or violate any provision of the certificate of incorporation or bylaws
of
Purchaser (true and complete copies of which certificate of incorporation and
bylaws of Purchaser, as in effect as of the date hereof, have previously been
delivered by Purchaser to the Companies), (b) require any filing with, or
permit, authorization, consent or approval of, any Governmental Entity, or
(c)
conflict with or violate any order, writ, injunction, decree, statute, rule
or
regulation applicable to, binding upon or enforceable against Purchaser or
any
of its properties or assets, except, in the case of clause (c), for such
conflicts or violations which would not impair the ability of Purchaser and
Parent to consummate the transactions contemplated hereby.
3.4 Brokers
and Finders.
None of
Purchaser, its officers, directors, employees or affiliates has employed any
broker or finder or incurred any liability for any investment banking fees,
brokerage fees, commissions or finders’ fees in connection with the transactions
contemplated by this Agreement.
-17-
ARTICLE
IV
ADDITIONAL
AGREEMENTS
4.1 Further
Assurances.
Subject
to the terms and conditions of this Agreement, Purchaser, the Companies, and
the
Shareholders shall (and the Shareholders shall cause the Companies to) use
all
reasonable efforts (but without incurring any additional material financial
obligation) to take, or cause to be taken, all actions and to do, or cause
to be
done, all things necessary, proper or advisable to consummate and make effective
the transactions contemplated by this Agreement. From time to time after the
date hereof, and at the request of any party hereto and without further
consideration, any other party shall execute and deliver to the requesting
party
such documents, which shall contain reasonable representations and warranties
regarding the authority of such persons to execute, deliver and perform such
documents and the enforceability thereof, and take such other action (but
without incurring any additional material financial obligation) as the
requesting party may reasonably request in order to consummate more effectively
the transactions contemplated hereby.
4.2 Public
Announcements.
No
party to this Agreement other than Purchaser shall make or cause to be made
any
press release or public announcement or otherwise communicate with any news
media concerning this Agreement or the transactions contemplated hereby, except
as may be required by law.
4.3 Tax
Returns.
The
parties shall cooperate in all reasonable respects with each other to permit
the
parties, in accordance with applicable law, to promptly prepare and file, on
or
before the due date or any extension thereof, all federal, state and local
Returns relating to the Companies, the Shareholders and the General Partners
required to be filed by such parties, and the parties shall cooperate with
respect to all tax matters, including any federal or state tax
audit.
4.4 Definitions
Related to Knowledge.
For the
purposes of this Agreement, the following terms shall have the meanings ascribed
to them below:
(a) “Best
Knowledge” shall mean (i) with respect to any individual, the knowledge of such
individual after a reasonable investigation, and (ii) with respect to the
Companies, the collective Best Knowledge of Xxx Xxxxxx and Xxxx
Xxxx.
(b) “Actual
Knowledge” shall mean (i) with respect to an individual, the actual knowledge of
such individual, (ii) with respect to the Companies, the collective Actual
Knowledge of Xxx Xxxxxx and Xxxx Xxxx.
4.5 Employee
Matters.
(a) Effective
as of and contingent upon the consummation of the transactions contemplated
by
this Agreement, Purchaser shall offer employment, commencing as of the date
hereof, to all Employees of the Companies (i) at comparable levels of wages
and/or salary as provided by the Companies, (ii) to the extent practicable
under
the circumstances, in comparable positions, immediately prior to the date
hereof, and (iii) with employee benefits that are at least as favorable in
the
aggregate as those provided under the Employee Benefit Plans of the Companies
set forth in Section 2.26(b) of the Disclosure Schedule. Each
such
Employee of the Companies who accepts Purchaser’s offer of employment and who
becomes an employee of Purchaser effective as of the date hereof is hereinafter
referred to as a “Transferred Employee,” and the
“Hire
Date” for a Transferred Employee shall mean the date hereof, provided that, in
the case of an Inactive Employee, he or she actually returns to active service
with Purchaser.
-18-
(b) Effective
as of the Hire Date, Purchaser shall assume the liability of the Companies
in
respect of the Transferred Employees for accrued and unpaid salaries, wages
and
vacation and sick pay, but only to the extent such liability is reflected on
the
Opening Balance Sheet. The Companies shall remain responsible for payment of
any
and all retention, change in control or other similar compensation or benefits
which are or may become payable to Employees
of the Companies in
connection with the consummation of the transactions contemplated by this
Agreement.
(c) The
Companies shall remain solely responsible for any and all liabilities relating
to or arising out of the following: (i) any pay, benefits, damages or other
claims to, by or on behalf of Employees of the Companies who are not Transferred
Employees, including compensation or benefits or otherwise arising out of
employment or the termination of employment, and whether incurred on or before
the date hereof, and (ii) any benefits, damages or other claims to, by or on
behalf of any Transferred Employee, including compensation or benefits or other
liabilities or costs arising out of employment or the termination of employment,
on or before the Hire Date.
(d) Purchaser
shall be responsible for (i) claims for workers compensation and welfare
benefits (as described in Section 3(1) of ERISA (whether or not covered by
ERISA, but excluding severance pay)) (“Welfare Benefits”) that are incurred on
or prior to the Hire Date by the Employees of the Companies, and (ii) claims
relating to continuation of health coverage required pursuant to Section 4980B
of the Code or Part 6 of Subtitle B of Title I of ERISA (“COBRA Coverage”)
attributable to “qualifying events” occurring prior to the Hire Date with
respect to any Employees of the Companies, any former employees of the Companies
and any beneficiaries and dependents of any of the Employees of the Companies
or
such former employees, to the extent that such liabilities are reflected on
the
Opening Balance Sheet. Purchaser shall be solely responsible for (i) any
benefits, damages or other claims to, by or on behalf of any Transferred
Employee, including involving compensation or benefits or otherwise, arising
out
of employment or the termination of employment after the Hire Date, and (ii)
COBRA Coverage attributable to “qualifying events” occurring on or after the
applicable Hire Date with respect to Transferred Employees and their
beneficiaries and dependents.
(e) For
purposes of vesting of benefits under the employee benefit plans of Purchaser
and its affiliates providing benefits after a Transferred Employee’s Hire Date,
such Transferred Employee shall be credited with his or her years of service
with the Companies before such Hire Date, to the same extent as such Transferred
Employee was entitled, before such Hire Date, to vesting credit for such service
under any similar Employee Benefit Plans to the extent permitted by Purchasers
benefit providers. In addition, and without limiting the generality of the
foregoing, (i) unless a waiting period is required by Purchaser’s benefit
providers, each Transferred Employee shall be immediately eligible to
participate, in any and all employee benefit plans sponsored by Purchaser and
its affiliates for the benefit of Transferred Employees (such plans,
collectively, the “New Plans”) to the extent coverage under such New Plan
replaces coverage under a comparable Employee Benefit Plan in which such
Transferred Employee participated immediately before such Hire Date (such plans,
collectively, the “Old Plans”), and (ii) for purposes of each New Plan providing
medical, dental, pharmaceutical or vision benefits to any Transferred Employee,
Purchaser shall cause all pre-existing condition exclusions and actively-at-work
requirements of such New Plan to be waived for such Transferred Employee and
his
or her covered dependents, but only to the extent permitted by applicable law
and Purchaser’s benefit providers, and Purchaser shall cause any eligible
expenses incurred by such Transferred Employee and his or her covered dependents
during the portion of the plan year of the Old Plan ending on the date such
Transferred Employee’s participation in the corresponding New Plan begins to be
taken into account under such New Plan for purposes of satisfying all maximum
deductible, coinsurance and out-of-pocket requirements applicable to such
employee and his or her covered dependents for the applicable plan year as
if
such amounts had been paid in accordance with such New Plan to the extent
permitted by Purchaser’s benefit providers.
-19-
(f) Purchaser,
the Companies and the Shareholders agree to furnish each other with such
information concerning Employees of the Companies and the Employee Benefit
Plans
and to take all such other reasonable action, as is necessary and appropriate
to
effect the transactions contemplated by this Section 4.6, in each case, to
the
extent permitted under applicable law.
ARTICLE
V
INDEMNIFICATION
5.1 Survival
of Representations and Warranties.
Unless
otherwise specifically provided herein, all representations, warranties,
covenants and agreements of the Companies, the Shareholders and the General
Partners contained in this Agreement shall survive until the third anniversary
of the date hereof, except that all such representations and warranties of
the
Companies and the Shareholders set forth in Sections 2.10(c), 2.10(i), 2.18,
2.19(a)(ii), 2.19(b)(iii), 2.19(b)(iv), 2.26, 2.28 and, to the extent related
to
any of the foregoing, 2.30, shall survive until the end of the period of any
applicable statutes of limitations, as the same may be extended by agreement
with any Governmental Entity. All representations, warranties, covenants and
agreements of the Purchaser hereunder shall survive until the end of the period
of any applicable statute of limitations.
5.2 Indemnification
by the Companies, Shareholders and the General Partners.
After
the execution and delivery of this Agreement, each of the Companies, the
Shareholders and the General Partners, jointly and severally, agrees to
indemnify and hold harmless Purchaser and its subsidiaries
and affiliates and their respective officers, directors, employees and agents
(collectively, “Purchaser’s Indemnified Persons”), against and in respect of any
payments, demands, claims, suits, judgments, liabilities, losses, costs, damages
or expenses (including reasonable expenses of investigations and reasonable
attorneys’ or consultants’ fees) (“Damages”) incurred or sustained by any of
Purchaser’s Indemnified Persons (a) as a result of any breach by the Companies
or the Shareholders of the representations, warranties, covenants or agreements
made by the Companies or the Shareholders contained herein (but not including
the representations and warranties in Section 2.18 hereof, which are governed
by
Section 5.6 hereof), reading such representations and warranties without regard
to any qualifications as to materiality or Material Adverse Effect, or (b)
related to, arising from or in connection with any the Companies Retained
Liability.
-20-
5.3 Limitations
on Indemnity.
(a) With
respect to claims for indemnification under clause (a) of Section 5.2, none
of
Purchaser’s Indemnified Persons shall be entitled to make any claim for
indemnification for any breach of representation or warranty after the date
on
which the same ceases to survive pursuant to Section 5.1 hereof, provided,
however, that if prior to such date the Companies or Shareholders shall have
received written notification of a claim for indemnity from any of Purchaser’s
Indemnified Persons, which notice shall specify in reasonable detail the facts
and circumstances which form the basis for such claim, then such claim, if
diligently pursued, shall continue as a basis for indemnity until it is finally
resolved.
(b) With
respect to claims for indemnification under clause (b) of Section 5.2, any
of
Purchaser’s Indemnified Persons shall be entitled at any time to make any claim
for indemnification thereunder, and the obligations of the Companies and the
Shareholders under clause (b) of Section 5.2 shall be perpetual.
(c) Notwithstanding
anything to the contrary in this Agreement, the Companies and the Shareholders
shall not be liable in indemnity pursuant to clause (a) of Section 5.2 unless
and until the aggregate Damages that Purchaser would otherwise be entitled
to
claim pursuant to such clause exceeds $25,000 and then only to the extent that
such Damages exceed such amount.
(d) Notwithstanding
anything to the contrary in this Agreement, (i) the Companies and the
Shareholders shall not in the aggregate be liable in indemnity pursuant clause
(a) of Section 5.2 for more than the aggregate amount of all payments received
by the Companies, the Shareholders and/or the General Partners pursuant to
this
Agreement.
5.4 Indemnification
by Purchaser.
(a) After
the
execution and delivery of this Agreement, Purchaser agrees to indemnify and
hold
harmless the Shareholders, the General Partners, the Companies and their
subsidiaries, affiliates, and all such person’s respective officers, directors,
employees and agents (collectively, the “Companies’ Indemnified Persons”),
against and in respect of any Damages incurred or sustained by any of them
(i)
as a result of any breach by Purchaser of the representations, warranties,
covenants or agreements made by Purchaser contained herein, or (ii) related
to,
arising from or in connection with any the Companies Assumed
Liability.
-21-
(b) With
respect to claims for indemnification under clause (i) of Section 5.4(a) of
this
Agreement, none of the Companies’ Indemnified Persons shall be entitled to make
any such claim for indemnification for any breach of representation or warranty
after the date on which the same ceases to survive pursuant to Section 5.1
hereof, provided, however, that if prior to such date Purchaser shall have
received written notification of a claim for indemnity from the Companies’
Indemnified Person, which notice shall specify in reasonable detail the facts
and circumstances which form the basis for such claim, then such claim, if
diligently pursued, shall continue as a basis for indemnity until it is finally
resolved.
(c) With
respect to claims for indemnification under clause (ii) of Section 5.4(a) of
this Agreement, any of the Companies’ Indemnified Persons shall be entitled at
any time to make any claim for indemnification thereunder, and the obligations
of Purchaser thereunder shall be perpetual.
5.5 Indemnification
Procedures.
(a) An
indemnified party under Section 5.2 or Section 5.4 or any successor thereto
or
permitted assignee thereof (an “Indemnified Party”) shall give prompt written
notice to a party obligated under Section 5.2 or Section 5.4 to provide
indemnification (an “Indemnifying Party”) of any Damages in respect of which
such Indemnifying Party has a duty to provide indemnity to such Indemnified
Party under Section 5.2 or Section 5.4, except that any delay or failure so
to
notify the Indemnifying Party shall relieve the Indemnifying Party of its
obligations hereunder only to the extent the Indemnifying Party is actually
and
materially prejudiced by reason of such delay or failure.
(b) If
a
third party asserts a claim against any Indemnified Party for Damages (a “Third
Party Claim”), the Indemnifying Party shall assume the defense thereof,
including the employment of counsel reasonably satisfactory to the Indemnified
Party and the payment of all expenses. The Indemnified Party shall have the
right to employ separate counsel in such Third Party Claim and participate
in
the defense thereof, but the fees and expenses of such counsel shall be at
the
expense of the Indemnified Party unless there are actual or potential conflicts
of interest between the Indemnified Party and the Indemnifying Party or if
there
are defenses available to the Indemnified Party which are not available to
the
Indemnifying Party, in which case the fees and expenses of such counsel shall
be
paid by the Indemnifying Party, provided, however, that the
Indemnifying Party
shall be responsible for the fees and expenses of only one such counsel in
respect of a Third Party Claim for all Indemnified Parties. In the event that
the Indemnifying Party fails to assume the defense thereof within a reasonable
time under the circumstances after notice of any Third Party Claim, the
Indemnified Party shall have the right to undertake the defense, compromise
or
settlement of such Third Party Claim for the account of the Indemnifying Party,
subject to the right of the Indemnifying Party to assume the defense of such
Third Party Claim with counsel reasonably satisfactory to the Indemnified Party
at any time prior to the settlement, compromise or final determination thereof.
Anything in this Section 5.5(b) to the contrary notwithstanding, the
Indemnifying Party shall not, without the Indemnified Party’s prior written
consent, such consent not to be unreasonably withheld, settle or compromise
any
Third Party Claim or consent to the entry of any judgment with respect to any
Third Party Claim except that, the Indemnifying Party may, without the
Indemnified Party’s prior written consent, settle or compromise any such Third
Party Claim or consent to entry of any judgment with respect to any Third Party
Claim which requires solely that monetary damages be paid by the Indemnifying
Party and which includes as an unconditional term thereof the release by the
claimant or the plaintiff of the Indemnified Party from all liability in respect
of such Third Party Claim. In the event that the Indemnifying Party shall have
assumed the defense of any Third Party Claim, the Indemnified Party shall not,
without the Indemnifying Party’s prior written consent, such consent not to be
unreasonably withheld, settle or compromise any such Third Party
Claim.
-22-
(c) With
respect to any claim for Damages other than a Third Party Claim, the
Indemnifying Party shall have thirty days from receipt of notice from the
Indemnified Party of such claim within which to respond thereto. If the
Indemnifying Party does not respond within such thirty-day period, the
Indemnifying Party shall be deemed to have accepted responsibility to make
payment and shall have no further right to contest the validity of such claim.
If the Indemnifying Party notifies the Indemnified Party within such thirty-day
period that it rejects such claim in whole or in part, the Indemnified Party
shall be free to pursue such remedies as may be available to the Indemnified
Party under applicable law.
(d) Any
Indemnified Party shall, upon receipt of a written request therefor from the
Indemnifying Party, provide the Indemnifying Party with reasonable access to
books and records within the control of the Indemnified Party as the
Indemnifying Party shall reasonably request (i) in order to defend a Third
Party
Claim as to which indemnification is being sought and as to which the
Indemnifying Party has assumed the defense, or (ii) with respect to any claim
by
an Indemnified Party as to which indemnification is sought.
5.6 Tax
Indemnification and Other Tax Matters.
(a) Notwithstanding
anything to the contrary in this Agreement, neither the Companies nor the
Shareholders shall be liable to any of Purchaser’s Indemnified Persons pursuant
to Section 5.2 for any Taxes or for any liability incurred in connection with
or
imposed by any Taxing Authority, including any interest, penalties, fines,
or
additions to Tax, and such liability shall instead be governed exclusively
by
this Section 5.6. In the event and to the extent that there shall be a conflict
between the provisions of Section 5.2, Section 5.3, Section 5.4 or Section
5.5,
and the provisions of Section 5.6, this Section 5.6 shall control.
(b) The
Companies and the Shareholders (collectively, the “Tax Indemnifying Parties”),
covenants and agrees to indemnify and hold harmless Purchaser’s Indemnified
Persons, from and against (i) all Taxes of the Companies attributable to periods
or portions thereof ending on or before the execution and delivery of this
Agreement (including any Taxes arising under Section 1374 of the Code or under
similar provisions of state or local laws as a result of the transactions
contemplated by this Agreement); (ii) all Taxes arising as a result of any
adjustment by a Taxing Authority to the consequences of any payments made by
the
Companies to any of its employees during the previous three years of the date
of
this Agreement or any payments by the Companies to any of its employees pursuant
to this Agreement; and (iii) reasonable costs and expenses (including reasonable
attorneys’ fees and expenses) incurred by Purchaser’s Indemnified Persons with
respect to the imposition of such Taxes.
-23-
(c) (i)
Notwithstanding
anything in this Agreement to the contrary, if a written notice of deficiency,
proposed adjustment, assessment, audit, examination, or other claim with respect
to the Companies shall be delivered or sent to Purchaser, the Companies or
the
Shareholders, or a suit or dispute commenced or initiated against Purchaser,
the
Companies or the Shareholders by any Taxing Authority with respect to which
any
of Purchaser’s Indemnified Persons is entitled to indemnification from the Tax
Indemnifying Parties pursuant to Section 5.6(b) (a “Taxing Authority Claim”),
the person receiving such notice or named in such suit or dispute shall promptly
notify the Tax Indemnifying Parties in writing of the Taxing Authority Claim,
which notice shall apprise the Tax Indemnifying Parties in reasonable detail
of
the nature of the Taxing Authority Claim, and shall furnish a copy thereof
to
Purchaser and the Companies.
(ii) The
Tax
Indemnifying Parties shall (unless they provide notice to Purchaser that they
elect otherwise, which notice shall be given within thirty days of the date
upon
which the Tax Indemnifying Parties receive notice of a Taxing Authority Claim),
assume and control the defense of any Taxing Authority Claim involving any
Taxable period for which a Return was legally required to be filed relating
to
periods or portions thereof ending on or before the date hereof, at their own
cost and expense and with their own counsel. The Tax Indemnifying Parties shall
keep Purchaser informed of all developments and events relating to such Taxing
Authority Claim, and the Tax Indemnifying Parties shall not have the right
to
settle or compromise a Taxing Authority Claim in a manner that may adversely
affect Purchaser’s Tax position for any Taxable Period without the prior written
consent of Purchaser, which consent shall not be unreasonably withheld. If
the
Tax Indemnifying Parties shall not elect to assume and control the defense
of
such Taxing Authority Claim, Purchaser shall control the defense of such Taxing
Authority Claim without adversely affecting its rights to indemnification
hereunder.
(iii) Purchaser
shall control the defense of any Taxing Authority Claim for which the Tax
Indemnifying Parties are not required to indemnify Purchaser’s Indemnified
Persons pursuant to Section 5.6(b).
(iv) With
respect to the settlement, compromise or disposition of any Taxing Authority
Claim which Purchaser exclusively controls pursuant to this Section 5.6(c)(iii),
Purchaser shall provide the Tax Indemnifying Parties with a statement
calculating the Tax Indemnifying Parties’ indemnification obligation pursuant to
Section 5.6(b) prior to the proposed payment by Purchaser of such Taxing
Authority Claim. In the event Purchaser and the Tax Indemnifying Parties cannot
agree as to their respective amounts of liability, the Tax Indemnifying Parties
shall be responsible for the amount they have in good faith determined to be
their liability, which amount shall be finally determined in accordance with
the
dispute resolution method described in Section 5.6(c)(v).
(v) Disputes
relating to any amount to be paid pursuant to Section 5.6, and any other matters
which any provision of Section 5.6 specifically provides are to be resolved
pursuant to the method set forth in this Section 5.6(c)(v), shall be resolved
by
submission to an independent accounting firm mutually acceptable to Purchaser
and the Tax Indemnifying Parties, which shall, within thirty days after such
submission, make its determination which shall be binding, final and conclusive
on the Tax Indemnifying Parties and Purchaser. Payment shall be made within
ten
days of the resolution of such dispute. The fees and disbursements incurred
in
resolving such dispute shall be borne equally by Purchaser and the Tax
Indemnifying Parties.
-24-
(d) The
Tax
Indemnifying Parties and Purchaser shall cooperate fully as and to the extent
reasonably requested by the other such party in connection with the preparation
and filing of any Return, and any claim, audit, litigation or other proceeding,
with respect to Taxes of the Companies or Purchaser. The Shareholders shall
retain and (upon Purchaser’s or the Tax Indemnifying Parties’ reasonable
request) provide Purchaser with any copies (or originals if required) of records
and information that are reasonably relevant to any Return, claim, audit,
litigation or other proceeding with respect to any Tax liability of the
Companies for any Taxable period for which a Return was legally required to
be
filed before the date hereof (taking into account filing extensions granted
in
response to timely and proper applications).
(e) For
the
purposes of this Agreement, the following terms shall have the meanings set
forth below:
(i) “Tax”
(and with correlative meaning, “Taxes” and “Taxable”) means any net income,
gross income, sales and use, transfer, gains, excise, gross receipts, capital
stock, production, disability, estimated, alternative or add-on, ad valorem,
transfer, withholding, franchise, profits, license, payroll, employment, excise,
severance, stamp, business and occupation, premium, real or personal property,
land value increment, withholding, environmental, value-added or windfall profit
tax, custom, duty or other tax, governmental fee or other like assessment or
charge of any kind whatsoever imposed on the Companies or Purchaser by any
U.S.
federal, state, local or foreign governmental authority (a “Taxing Authority”)
responsible for the imposition of any such Tax, together with any interest
or
any penalty, addition to Tax or additional amount imposed with respect to any
of
the foregoing Taxes incurred in connection with the determination, settlement
or
litigation of any tax liability.
(ii) “Return”
means any tax return, statement, report or form (including estimated tax returns
and reports and information returns and reports) required to be filed with
any
Taxing Authority with respect to Taxes.
5.7 Confidentiality.
The
parties hereto agree to cooperate in such a manner as to preserve in full the
confidentiality of all confidential business records and attorney-client
privilege and work-product immunity. In connection therewith, each party hereto
agrees that
(a) it
will
use all reasonable efforts, in any action, suit or proceeding in which it has
assumed or participated in the defense, to avoid production of confidential
business records; and
(b) all
communication between any party hereto and counsel responsible for, or
participating in, the defense of any action, suit or proceeding shall, to the
extent possible, be made so as to preserve any applicable attorney-client
privilege or work-product
immunity.
-25-
5.8 Right
of Setoff.
Notwithstanding any other provision of this Agreement, Purchaser shall be
entitled to deduct from any payments owed to the Companies or the Shareholders
pursuant to this Agreement or otherwise the amount of any Damages incurred
or
sustained by any of Purchaser’s Indemnified Persons for which indemnification is
available pursuant to this Article V.
5.9 Remedies
Cumulative.
Except
as otherwise expressly provided herein, the remedies provided herein shall
be
cumulative and shall not preclude the assertion by any party hereto of any
other
rights or the seeking of any other remedies against any other party
hereto.
ARTICLE
VII
GENERAL
PROVISIONS
6.1 Amendment
and Waiver.
No
amendment of any provision of this Agreement shall in any event be effective
unless the same shall be in writing and signed by all of the parties hereto.
Any
failure of any party to comply with any obligation, agreement or condition
hereunder may only be waived in writing by the other parties, but such waiver
shall not operate as a waiver of, or estoppel with respect to, any subsequent
or
other failure. No failure by any party to take any action with respect to any
breach of this Agreement or default by any other party shall constitute a waiver
of such party’s right to enforce any provision hereof or to take any such
action.
6.2 Notices.
All
notices, requests and other communications hereunder shall be (i) in writing,
(ii) delivered personally, telecopied (if confirmed), delivered by a nationally
recognized overnight courier service (with proof of delivery), or mailed by
registered or certified mail (postage prepaid, return receipt requested), and
(iii) deemed given (A) upon receipt if personally delivered or telecopied (if
confirmed), (B) on the date delivered by a nationally recognized courier service
as set forth on its record of delivery, or (C) on the fifth day after the date
set forth on the receipt of certified or registered mailing, and (iv) addressed
to the parties at the following addresses (or at such other address for a party
as shall be specified by like notice):
(a) If
to the
Companies or Shareholders,
J&J
Leasing Partnership
X.X.
Xxx
000000
Xxxxxxxxx,
Xxxxx 00000
Facsimile:
[____________]
With
a
copy to,
Xxxxxxx
Xxxxx
Xxxxx
Xxxxxx P.C.
00000
Xxxxxx Xxxxxxx, Xxxxx 0000
Xxxxxx,
Xxxxx 00000
Facsimile:
000-000-0000
-26-
(b) If
to
Purchaser,
Xxxxxxx
Xxxxxxxx
Chief
Executive Officer
BCI
Communications
00
Xxxxxx
Xxxxxx
Xxxxxxx,
Xxx Xxxxxx 00000
Facsimile:
000-000-0000
With
a
copy to,
Xxxxxx
& Xxxxxx
000
Xxxxx
0 Xxxxx, Xxx. 000
Xxxxxxxxx,
Xxx Xxxxxx, 00000
Facsimile:
000 000-0000
Xxxx
Xxx
General
Counsel
BCI
Communications, Inc.
00
Xxxxxx
Xxxxxx
Xxxxxxx,
Xxx Xxxxxx 00000
Facsimile:
000-000-0000
6.3 Entire
Agreement; Assignment; Governing Law.
(a) This
Agreement constitutes the entire agreement, and supersedes all other agreements
and understandings, both written and oral, between the parties with respect
to
the subject matter hereof.
(b) This
Agreement shall not be assigned by any party (by operation of law or otherwise)
without the prior written consent of the other parties, except that (i)
Purchaser may assign this Agreement to any affiliate of Purchaser without the
consent of any other party, and (ii) Purchaser may assign this Agreement to
any
other person, provided, however, that, in either case, Purchaser shall each
remain fully liable for the performance of all its obligations
hereunder.
(c) This
Agreement shall be governed by and be construed in accordance with the laws
of
the State of New Jersey, without giving effect to the principles of conflicts
of
laws thereof.
6.4 Equitable
Remedies.
Each of
the parties hereby acknowledges and agrees that monetary damages would not
be a
sufficient remedy for, and other parties would be irreparably harmed by, any
breach by it of this Agreement and that each party shall be entitled to specific
performance and injunctive relief, without payment of bond or security, as
remedies for any such breach. Such remedies shall not be deemed to be the
exclusive remedies for a breach of this Agreement by a party but shall be in
addition to all other remedies available to the non-breaching parties at law
or
in equity.
-27-
6.5 Parties
in Interest.
This
Agreement shall be binding upon and inure solely to the benefit of each party
hereto and, subject to Section 6.3(b) hereof, their respective successors
(including executors and administrators) and assigns, and nothing in this
Agreement, express or implied, is intended to confer upon any other person
any
rights or remedies of any nature whatsoever under or by reason of this
Agreement.
6.6 Descriptive
Headings.
The
section and other headings contained in this Agreement and the Disclosure
Schedule are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement or the Disclosure
Schedule.
6.7 Interpretation.
(a) As
used
in this Agreement, unless expressly stated otherwise, (i) the word “or” is used
disjunctively and not exclusively; (ii) the word “including” is used without
limitation; and (iii) words of grammatical gender are used gender
neutrally.
(b) Ambiguities
in this Agreement shall be interpreted in the light of the intentions of the
parties at the time this Agreement was made and shall not be interpreted for
or
against any party on the basis that such party was responsible or primarily
responsible for the drafting of this Agreement.
6.8 Transaction
Costs.
Except
as otherwise expressly provided herein, all costs, fees and expenses incurred
by
the parties in connection with this Agreement, the transactions contemplated
by
this Agreement or the negotiations preceding this Agreement (including fees
and
disbursements of counsel, brokers, finders, investment bankers, accountants,
financial advisors or other professionals) shall be borne by the party incurring
them.
6.9 Severability.
If any
term, provision, covenant or restriction of this Agreement is held by a court
of
competent jurisdiction to be invalid, void or unenforceable, the remainder
of
the terms, provisions, covenants and restrictions of this Agreement shall remain
in full force and effect and shall in no way be affected, impaired or
invalidated.
6.10 Consent
to Exclusive Jurisdiction and Service of Process.
Any
legal action or proceeding arising out of or relating to this Agreement shall
be
brought solely in the federal or state courts located in Bergen County in the
State of New Jersey. The parties hereby accept for themselves and in respect
of
their property, generally and unconditionally, the exclusive jurisdiction of
the
aforesaid courts. The parties irrevocably waive any objection or defense which
they may now or hereafter have to the bringing of any such action or proceeding
in any of the aforesaid courts, including, without limitation, any objection
or
defense based upon lack of personal jurisdiction, improper venue, the doctrine
of forum non conveniens, or 28 U.S.C. § 1404, and the parties agree not to
seek the dismissal or transfer of any action or proceeding brought in any of
the
aforesaid courts upon any of such grounds. Each of the parties further
irrevocably consents to the service of process out of any of the aforementioned
courts in any such action or proceeding by the mailing of copies thereof by
registered mail, postage prepaid, to the party at the address specified in
this
Agreement in Section 6.2, such service to become effective fifteen days after
such mailing. Nothing herein shall in any way be deemed to limit the ability
of
any party hereto to serve any such legal process, summons, pleading or other
court paper in any other manner permitted by applicable law.
-28-
6.11 Counterparts.
This
Agreement may be executed in two or more counterparts, each of which shall
be
deemed an original, but all of which together shall constitute one and the
same
agreement.
-29-
IN
WITNESS WHEREOF, the parties hereto have executed, or caused their respective
officers thereunto duly authorized to execute, this Agreement as of the date
first written above.
|
DIGITAL
SERVICES COMMUNICATIONS,
INC.
|
||
| |
|
|
| By: | ||
|
Name: |
||
| Title: | ||
|
J&J
LEASING PARTNERSHIP
|
||
| |
|
|
| By: | ||
|
Name: Xxxxx
Xxxxxx
|
||
|
Title: General
Partner
|
||
|
And
|
||
| |
|
|
| By: | ||
|
Name: Xxxxxxx
Xxxx
|
||
|
Title: General
Partner
|
||
|
Xxx
Xxxxxx
|
||
|
|
||
|
Xxxx
Xxxx
|
||
|
BCI
COMMUNICATIONS, INC.
|
||
| |
|
|
| By: | ||
|
Name: Xxxxxxx
Xxxxxxxx
|
||
|
Title: Chief
Executive Officer
|
||
-30-
