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Previous: HICKORY TECH CORP, 10-Q, EX-27, 2000-08-11 |
Next: LIGHT MANAGEMENT GROUP INC, NT 10-Q, 2000-08-11 |
Exhibit 99
AGREEMENT FOR
SALE AND PURCHASE
OF ASSETS
DATED AS OF JULY 21, 2000
BETWEEN
HICKORY TECH CORPORATION,
THROUGH ITS WHOLLY-OWNED SUBSIDIARY,
AMANA COLONIES TELEPHONE COMPANY,
AS SELLER
AND
SOUTH SLOPE COOPERATIVE TELEPHONE COMPANY
AS BUYER
AGREEMENT FOR SALE AND PURCHASE OF ASSETS
This Agreement for Sale and Purchase of Assets is made and entered into effective as of the 21st day of July, 2000, by and between Hickory Tech Corporation, for and on behalf of its wholly owned subsidiary, Amana Colonies Telephone Company, Minnesota corporations ("Seller"), and South Slope Cooperative Telephone Company, an Iowa cooperative association ("Buyer").
NOW, THEREFORE, for and in consideration of the foregoing and the mutual covenants and agreements set forth in this Agreement, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Seller and Buyer make the following Agreement.
ARTICLE 1
SALE AND PURCHASE OF ASSETS
1.1 Sale and Transfer. Upon the terms and subject to the conditions hereinafter set forth, and pursuant to the documents of transfer as required by Section 4.3 of this Agreement, Seller agrees to sell, convey, transfer, assign and deliver to Buyer, and Buyer agrees to buy from Seller, as of the Closing Date, all of Seller's Assets described below and as listed on Schedule 1.1a hereto (the "Transferred Assets"). The items listed on Schedule 1.1b hereto (the "Excluded Assets") shall be retained by Seller. Buyer agrees to purchase the Transferred Assets from Seller as set forth in the following Sections, and which shall include without limitation the assets described on Schedule 1.1a and the assets described in the following Sections 1.2 through 1.11:
1.2 Central Office Real Estate/Right of First Refusal. The land on which the central telephone office of the Exchange is located, together with the central office building and other improvements (collectively, the "Central Office Real Estate"), as described on the attached Schedule 1.2, which the Buyer shall use only as a central telephone office. Buyer understands that the Central Office Real Estate is subject to a right of first refusal retained by Seller's predecessor in interest, namely Amana Society, Inc. Pursuant to the reserved right of first refusal, Amana Society, Inc. has the right of first refusal to repurchase (i) the land included in the Central Office Real Estate (the "Land") for the amount of $3,000.00, and/or (ii) any buildings, structures, or improvements then located on Land (collectively, the "Improvements") for the lesser of the fair market value or the amount offered by a Buyer. Seller shall provide Buyer with a copy of the right of first refusal agreement between Seller and Amana Society, Inc. within five (5) business days following the execution of this Agreement. These two separate rights of first refusal are exercisable in accordance with the following provisions. The parties agree that these rights of first refusal must be waived by Amana Society, Inc., or Amana Society, Inc. must fail to exercise the rights as provided in paragraph c below, as a condition to Buyer's obligation to close hereunder.
option(s) to repurchase the Land and/or Improvements in accordance with the price provisions contained in its retained right of first refusal and, at the option of the Amana Society, Inc., with such payment terms as are included in the notice. The election to exercise either of the options must be made in writing and mailed by certified mail to Seller. If exercised, Seller is bound to close on such transaction within 60 days after Amana Society, Inc. provides notice of such election, or at such other time as the parties may mutually agree.
1.3 Office Warehouse Space. To the extent assignable by Seller, the Seller will assign to Buyer the lessee's interest in its leased office/warehouse facility known as the former "Homestead Implement" building located at 4429 V Street, Homestead, Iowa. Notwithstanding its good faith efforts, in the event the Seller is unable to assign the lessee's interest in the lease for any reason the Buyer shall accept as full performance any performance that Seller can make, without reduction in the Purchase Price. The form of Assignment of Lease is attached hereto as Exhibit 1.3;
1.4 Telecommunications Plant—In Service and Under Construction. All transmission assets, including without limitation, all trunk lines and service lines (whether underground or above ground), pole placements, poles, posts, cross-arms, wire, cable, conduits, ducts, switches, fixtures, switchboards, test boards, frames, racks, motors, generators, batteries and other items of central office equipment, subscriber station equipment, including house wiring and protectors, instruments, connections, appliances and other equipment which is incorporated in or attached or connected to any of the lines or facilities included in the Exchange, together with all construction in progress that includes any of the preceding items (collectively, the "Telecommunications Plant");
1.5 Easements—Telecommunications Plant. Easements for the Telecommunications Plant, whether written or oral, recorded or unrecorded, underground and above ground, as more particularly described below. Seller shall provide Buyer with copies of all written easement agreements within five (5) business days following the execution of this Agreement. The Seller hereby discloses, without representation or warranty of any nature, that it uses the following easements for the placement and maintenance of, and access to, the entire Telecommunications Plant as it currently exists:
1.6 Supplies and Equipment. All supplies and equipment (excluding vehicles and test equipment) which are used in connection with the operation of the Exchange, except office supplies and office equipment which are specifically excluded from the Transferred Assets;
1.7 Easements Right-of-Way Privileges. Such easements, right-of-way privileges, rights of ingress and egress, leases, contracts, encroachment agreements and other interests in real estate, granted to or owned by the Seller, which give or vest in the Seller the right or privilege to construct, operate or maintain the Telecommunications Plant on real estate owned or held by third parties, together with all agreements and contracts which grant privileges for railroad, power line, telephone or telegraph line crossings or parallels, and or joint use of any assets;
1.8 Franchises / Licenses. All franchises, licenses, authorizations, ordinances, permits, or privileges owned or held by the Seller that are reasonably related to the construction, maintenance and operation of the Exchange;
1.9 Long Term Service Contract. All rights of Seller, to the extent assignable by Seller, to require Amana Society, Inc. to purchase long distance products and centrex/voice mail services from Seller for the remainder of a ten year period ending ten years after April 4, 1994. These Seller rights shall be assigned to Buyer pursuant to the form of Assignment attached hereto as Exhibit 1.9, to the extent the same is assignable by Seller. A copy of the long term service contract is also attached hereto as Exhibit 1.9;
1.10 Goodwill. All goodwill associated with the operation of the Exchange, including the benefit of the 20-year Noncompetition Covenant made by Amana Society, Inc., which shall be assigned to Buyer pursuant to the form of Assignment attached hereto as Exhibit 1.10, to the extent the same is assignable by Seller. A copy of the Noncompetition Covenant is also attached hereto as Exhibit 1.10; and
1.11 Records. All books, records, files, customer lists, maps, drawings, charts, blueprints, diagrams, engineering data, accounting data, correspondence and related items reasonably necessary and useful for the continued operation and maintenance of the Exchange.
1.12 Selected Asset Purchase; No Right to Use "Amana" Name. The transaction contemplated by this Agreement includes the sale and purchase only of the Transferred Assets described in this Agreement and the Schedules attached hereto, and does not contemplate the sale and purchase of certain excluded assets of the Exchange, such as cash, accounts receivable, prepaid expenses, office equipment and office supplies listed on Schedule 1.1b or the name, "Amana Colonies Telephone Company." Buyer recognizes that Amana Society, Inc. is the owner of certain designs, emblems, symbols, color schemes, logos, signs, trademarks and trade names, including the name and mark "Amana" (collectively, the "Trademarks"). The Buyer acknowledges and agrees that Amana Society, Inc. is the sole owner of the Trademarks, and the related goodwill that is associated with the Trademarks. The Buyer shall not hereby acquire any right, title or interest in such Trademarks, and does hereby disclaim any right, title, or interest in such Trademarks, and agrees that the Buyer shall not acquire any such rights under this Agreement.
The Transferred Assets, to the extent not transferred to Buyer pursuant to Exhibits 1.2c, 1.3, 1.5b or 1.9, shall be transferred to Buyer at the Closing pursuant to the terms of a Bill of Sale, substantially in accordance with Exhibit 1.12 attached hereto.
2.1. No General Assumption of Liabilities. Except as provided in Section 2.2 below or as otherwise provided in this Agreement, the Buyer does not assume any liabilities, obligations, or undertakings of the Seller of any kind or nature whatsoever, fixed or contingent, known or unknown, determined or determinable, due or not yet due, including but not limited to accounts payable, notes payable, accrued expenses, employee entitlements or taxes of any kind.
2.2 Customer Deposits. Notwithstanding the foregoing, on the Closing Date, the Seller shall deliver to Buyer a detailed list of all customer deposits, together with accrued interest (if any). Such list shall include each customer name, address, deposit amount, and date or conditions for return, together with good funds payable to Buyer for the total amount of all such deposits and accrued interest. At the Closing, Seller and
Buyer shall enter into an Assignment and Assumption Agreement for such customer deposit liability to be assumed by Buyer, and such Agreement shall include an appropriate release of liability for, and indemnification of, the Seller. The form of Assignment and Assumption Agreement is attached as Exhibit 2.2.
3.1. Purchase Price and Allocation. Buyer shall pay to Seller as full consideration for the transfer of the Transferred Assets, a total Purchase Price of Six Million Five Hundred Thousand Dollars ($6,500,000.00). No later than ten days prior to Closing, the Buyer and Seller shall have negotiated, in good faith, the allocation in Purchase Price among the Transferred Assets under the residual method as described in Section 1060 of the Internal Revenue Code. Buyer and Seller shall exchange at the Closing IRS Form 8594, Asset Allocation Statement, and the Buyer and Seller agree to report this transaction for tax purposes in accordance with such allocation, and to attach the applicable asset acquisition statement to their respective income tax returns for the taxable year of reporting this transaction.
3.2 Payment Terms. The above purchase price shall be paid by the Buyer to the Seller as follows:
If the transaction contemplated by this Agreement does not close because of a material breach (which shall not include the nonoccurrence of conditions precedent to Buyer's obligation to close set forth in Section 6.1) by the Buyer under this Agreement, the Good Faith Deposit shall be retained by Seller as liquidated damages and not as a penalty, and forfeiture of the Good Faith Deposit shall be Seller's sole and exclusive remedy for Buyer's breach. If the transaction contemplated by this Agreement does not close for any other reason, Seller shall timely return the Good Faith Deposit to Buyer.
3.3 Taxes and Governmental Charges. Buyer shall pay any and all sales, use, transfer, stamp, conveyance, value added or similar taxes, duties, excises or governmental charges imposed by any taxing jurisdiction, including all recording fees, notarial fees and other similar costs incurred in connection with the sale, transfer or assignment of the Transferred Assets or otherwise on account of this Agreement, except that Seller shall pay any accrued real or personal property taxes and franchise fees or other charges relating to operation of the Exchange prior to the Closing Date. Buyer, in its capacity as agent for Seller, shall assume Seller's obligation to pay all such accrued items for and on behalf of Seller, to the extent that the purchase price has been adjusted to reflect such items, and shall further submit timely evidence that Buyer has in fact paid such accrued items.
3.4 Costs. Each party shall pay at Closing its own brokerage and attorneys' fees, if any, incurred in connection with the sale of the Transferred Assets from Seller to Buyer.
4.1 Closing Date. Provided that all conditions precedent have been satisfied or waived prior to then, the transactions contemplated by this Agreement shall be closed at 10:00 a.m. at the Seller's offices in Mankato, Minnesota on the "Closing Date", which shall be the earlier of:
4.2 Closing Cut-Off. The Seller shall be entitled to all revenues and shall be liable for all costs and expenses of the Exchange for the period ending at the close of business on the Closing Date. The Buyer shall be entitled to all revenues and shall be liable for all costs and expenses of the Exchange for the period
beginning as of the commencement of business on the day following the Closing Date. The parties will work together in good faith to make a correct and complete determination of such amounts. The following provisions shall apply with respect to the monthly charges to customers of the Exchange for local exchange service ("Local Service Charges") and long distance calls made by customers ("Long Distance Charges").
To the extent any real estate interest is transferred under this Agreement, all applicable Real Estate taxes payable or accrued in the year of Closing shall be prorated between Seller and Buyer based upon the actual number of days elapsed in the calendar year. All other utilities and operating costs related to any real estate interest transferred under this Agreement shall be prorated as of the date of Closing.
4.3 Documents of Transfer to be Delivered by Seller to Buyer. On the Closing Date, the Seller shall deliver to the Buyer all documents and instruments necessary to transfer title to the Transferred Assets to Buyer, free and clear of any liabilities or liens, and shall take any action that is reasonably required to effectuate the transaction contemplated by this Agreement. Such documents shall include without limitation, a deed, bill of sale, and one or more assignments of easements. All closing documents, including instruments of conveyance, shall be in form reasonably acceptable to the Seller, Buyer and their respective counsel. Such documents shall include:
4.4 Deliveries by Buyer to Seller. At or prior to the Closing, Buyer will deliver to Seller:
4.5 Records to be Retained by Seller. Title to all of Seller's records, documents and papers of every kind and nature pertaining to the Exchange sold hereunder shall remain in Seller, but any thereof which Buyer may reasonably require for use in connection with the operation of the Exchange after the Closing Date shall either be delivered to Buyer or made available to it in such manner as may best meet the respective needs of the parties. In any case the party receiving or retaining such records shall make them available to the other during a period of five years following the Closing Date. After the expiration of said five-year period either party shall, before destroying any of such records received or retained by it, offer them to the other.
Seller shall promptly forward to Buyer all correspondence, mail, payments and documents received by Seller after the Closing Date which relate to the operations of the Exchange occurring prior to or after the Closing Date.
Buyer shall promptly forward to Seller all correspondence, mail, payments and documents received by it not related to the operation of the Exchange, such as matters concerning the Seller's income taxes, corporate charter or corporate governance.
ARTICLE 5
ENVIRONMENTAL CONDITIONS;
ASSETS SOLD "AS IS" AND "WHERE IS"
5.1 Plant and Facility; Offices; Asbestos; Hazardous Materials. Buyer acknowledges that the Seller's plant and facility and offices and adjacent structures, appurtenances, facilities and improvements thereon and the Transferred Assets may contain asbestos-containing or other hazardous materials. In addition, Buyer acknowledges that the Transferred Assets may contain other hazardous materials. Buyer also
acknowledges that it is aware that certain hazardous materials are used in maintenance and operations related to Seller's operations and the Transferred Assets, and that such hazardous materials may be present in the Transferred Assets. Buyer acknowledges that Seller has informed Buyer of the potential presence of asbestos-containing materials in the Transferred Assets and in the Land and Improvements, as well as other hazardous materials in the Transferred Assets, and Buyer acknowledges that the Purchase Price of the Transferred Assets reflects the potential presence of the asbestos-containing materials as well as hazardous materials and environmental claims or liabilities that may be associated with the Transferred Assets. Buyer understands and agrees that any responsibility for compliance with any environmental law, regulation or ordinance applicable to the ownership or use of the Transferred Assets following the Closing, including the costs of any remediation or cleanup associated with the Transferred Assets, or environmental claim or liability associated with the Transferred Assets, irrespective of when contamination occurred, is assumed by Buyer at the Closing.
SELLER HEREBY DISCLAIMS ALL WARRANTIES, WHETHER EXPRESSED OR IMPLIED WITH REGARD TO THE CONDITION OR SAFETY OF THE TRANSFERRED ASSETS OR THE PRESENCE OF HAZARDOUS MATERIALS IN THE TRANSFERRED ASSETS.
5.2 AS IS Sale. The Buyer acknowledges and represents that it has had full opportunity to evaluate the assets to be purchased hereunder and has made its own evaluation of any revenue Buyer might expect to derive from the use of such assets. The Seller makes no representations or warranties whatsoever with respect to the assets herein agreed to be purchased by Buyer, the profitability of the Exchange as previously conducted by Seller, or the ability of such assets to generate any revenues in the future. Buyer agrees to take the Transferred Assets "AS IS" and "WHERE IS" and without any representation or warranty of any nature, whether in fact or law, or whether expressed or implied as it relates to the any condition of the Transferred Assets. Buyer has made all legal, factual and other inquiries and investigations as Buyer deems necessary, desirable or appropriate with respect to the Transferred Assets, and Buyer is purchasing the Transferred Assets based on Buyer's own inspection and examination thereof.
BUYER UNDERSTANDS THAT THE SELLER MAKES NO REPRESENTATIONS, WARRANTIES OR GUARANTEES, WHETHER EXPRESS OR IMPLIED, OF ANY KIND, NATURE OR TYPE WHATSOEVER WITH RESPECT TO THE TRANSFERRED ASSETS, INCLUDING, WITHOUT LIMITATION, THE APPURTENANCES, FACILITIES AND IMPROVEMENTS THEREON, OR THE VALUE, MARKETABILITY, FEASIBILITY, DESIRABILITY, PROFITABILITY OR ADAPTABILITY THEREOF.
5.3 Disclaimer of Warranties. SELLER HEREBY DISCLAIMS ANY AND ALL REPRESENTATIONS OR WARRANTIES, EXPRESSED OR IMPLIED, EXCEPT AS SPECIFICALLY SET FORTH HEREIN. SELLER IS NOT WARRANTING THE CONDITION OR USEFULNESS OF THE TRANSFERRED ASSETS, OR THEIR VALUE.
6.1 Conditions to Buyer's Obligations. The obligation of Buyer to consummate the Transactions shall be subject to the satisfaction, on or prior to the Closing Date, of each of the following conditions, any of which may, to the extent allowed by law, be waived by Buyer:
6.2 Conditions to Seller's Obligations. The obligations of Seller to consummate the Transactions shall be subject to the satisfaction, on or prior to the Closing Date, of each of the following conditions, any of which may, to the extent allowed by law, be waived by Seller:
ARTICLE 7
REPRESENTATIONS AND WARRANTIES
7.1 Buyer's Representations and Warranties. Buyer represents and warrants to Seller that:
Buyer has obtained through its independent investigation, and understands the fair implications of this information. Buyer has not received from the Seller, or from anyone acting or claiming to act on behalf of the Seller, any accounting, tax, legal or other advice with respect to the Transferred Assets or the transactions related thereto, and Buyer is relying solely on advice of its own accounting, tax, legal and other advisors. Buyer has such knowledge, experience and sophistication in financial and business matters as to enable it to evaluate all of the merits and risks associated with the Transferred Assets and the transactions related thereto.
7.2 Seller's Limited Representations and Warranties. Seller represents and warrants to Buyer that:
Seller pursuant to such returns, reports, or otherwise, have been paid other than accrued property taxes that have been credited against the purchase price.
8.1 Covenants of Buyer. Buyer hereby covenants and agrees that from the execution date hereof to the Closing Date:
8.2 Covenants of Seller. Seller hereby covenants and agrees that from the execution date hereof to the Closing Date:
8.3 Mutual Covenants.
If the Transactions are not consummated for any reason, each party agrees to return to the other party all such Confidential Information, including all copies thereof, immediately on request. The obligations arising under this section shall survive any termination or abandonment of this Agreement.
regulations, expeditiously and practicably to consummate and make effective the Transactions, including, but not limited to, using its reasonable efforts to obtain all necessary actions, waivers, consents and approvals from third parties or governmental or regulatory bodies.
8.4 Employment of Key Exchange Employees. Following Closing, Buyer agrees in good faith to make offers of at-will employment to those key existing employees of the Seller identified in the attached Exhibit 8.4 upon the terms and conditions substantially as set forth in Exhibit 8.4. (For purposes of Section 8.4 and Exhibit 8.4, those employees identified in Exhibit 8.4 shall be referred to as the "At-Will Employees"). In doing so, the parties agree that neither this Agreement nor Exhibit 8.4 shall be construed as a contract of employment, and that as condition of their employment the At-Will Employees shall be required to sign a document in a form satisfactory to the Buyer which acknowledges the "at-will" nature of their employment with the Buyer. Furthermore, Seller acknowledges that it shall retain any and all liability relating to the employment of the At-Will Employees for the period of time in which the At-Will Employees were employed by the Seller, including, without limitation, liability arising from accrued and unpaid wages, paid time-off, vacation and/or sick leave, and workers' compensation claims.
9.1 Indemnity by Seller. The Seller agrees to indemnify, defend, and hold the Buyer harmless from and against any claim, damage, fine, or other expense (including reasonable attorney fees and costs) arising out of (i) the Seller's breach of any covenants, representations or warranties under this Agreement, (ii) acts or omissions that occurred with respect to the Seller's operation of the Exchange prior to the Closing Date, or (iii) any obligation of Seller not assumed by Buyer pursuant to the terms of this Agreement. In no event, however, shall Seller's liability hereunder exceed the sum of one million dollars ($1,000,000). The Seller shall pay these expenses upon demand. The Seller's obligations under this section shall be conditioned upon (i) prompt written notification of the nature and the amount of the claim, and (ii) waiting thirty (30) days from the receipt of such notice to provide an opportunity to settle such claim. The Seller may elect to contest the claim, and in that case, shall have thirty (30) days to secure the Buyer against the claim. The parties agree to cooperate fully with each other in the defense or settlement of any third party claim. The Buyer shall not settle any claim under this provision without prior written notice to the Seller, and the Seller's approval which shall not be withheld unreasonably.
9.2. Indemnity by Buyer. The Buyer agrees to indemnify, defend, and hold the Seller harmless from and against any claim, damage, fine, or other expense (including reasonable attorney fees and costs) arising out of (i) the Buyer's breach of any representations or warranties under this Agreement, or (ii) acts or omissions that occur with respect to the Buyer's operation of the Exchange after the Closing Date. In no event, however, shall Buyer's liability hereunder exceed the sum of one million dollars ($1,000,000). The Buyer shall pay these expenses upon demand. The Buyer's obligations under this section shall be conditioned upon (i) prompt written notification of the nature and the amount of the claim, and (ii) waiting thirty (30) days from the receipt of such notice to provide an opportunity to settle such claim. The Buyer may elect to contest the claim, and in that case, shall have thirty (30) days to secure the Seller against the claim. The parties agree to cooperate fully with each other in the defense or settlement of any third party claim. The Seller shall not settle any claim under this provision without prior written notice to the Buyer and the Buyer's approval which shall not be withheld unreasonably.
10.1 Termination By Buyer. If any condition precedent to Buyer's obligation to effect the Closing, as set forth in Section 6.1 is not satisfied and such condition is not waived, if waivable, by Buyer on or prior to the Closing Date, Buyer shall not be obligated to effect the Closing and may terminate this Agreement. Termination of this Agreement due to the nonoccurrence of such a condition shall not result in the forfeiture of the Good Faith Deposit.
10.2 Termination By Seller. If any condition precedent to Seller's obligation to effect the Closing, as set forth in Sections 6.2b, c, d, e or f is not satisfied and such condition is not waived, if waivable, by Seller on or prior to the Closing Date, Seller shall not be obligated to effect the Closing and may terminate this Agreement and retain the Good Faith Deposit in accordance with the provisions of Section 3.2. If, however, the conditions precedent to Seller's obligation to effect the Closing, as set forth in Sections 6.2a or 6.2g, are not satisfied and such conditions are not waived, if waivable, by Seller on or prior to the Closing Date, Seller may also terminate this Agreement, but in that event, the Good Faith Deposit shall be returned to Buyer.
10.3 Effect of Termination. In the event of the termination of this Agreement pursuant to Section 10.1 or 10.2, this Agreement shall thereafter become void, without further liability on the part of any party hereto or its respective shareholders, directors, officers or employees in respect thereof, except for the obligation, if any, to return the Good Faith Deposit as provided for in Section 3.2, and except that nothing herein shall relieve any party from liability for any breach of this Agreement prior to termination under Section 10.1 or 10.2.
ARTICLE 11
POST CLOSING MATTERS
11.1 Seller's Name Not Sold. Seller has retained the use of the Exchange name, "Amana Colonies Telephone Company", and has not sold that name, or the name "Amana" to Buyer.
11.2 Bulk Transfer Compliance. The parties agree that the transaction contemplated by this Agreement is not subject to the Iowa Bulk Transfer Act.
11.3 Announcements. The Seller shall have the right to review and comment on any announcements or notice the Buyer proposes to make to the public or to any customers and other relevant parties prior to the Closing Date. The Buyer shall make no public announcement of the transaction contemplated by this Agreement prior to the Closing Date, unless the prior consent of the Seller is obtained, which shall not be withheld unreasonably.
12.1 Arbitrability. All claims by Buyer or Seller by one against the other arising out of or related in any manner to this Agreement or Transferred Assets or the Transactions shall be resolved by arbitration, as prescribed herein.
12.2 Rules. A single arbitrator engaged in the practice of law and who has at least eight years of litigation experience shall conduct the arbitration under the then current commercial arbitration rules of the American Arbitration Association ("AAA"), unless otherwise provided herein. The arbitrator shall be selected in accordance with AAA procedures. The arbitration shall be conducted in Des Moines, Iowa.
12.3 Discovery; Damages; Expenses. The Buyer and Seller shall allow and participate in discovery in accordance with the Federal Rules of Civil Procedure. The arbitrator shall rule on unresolved discovery disputes. The arbitrator shall only have authority to award contractual damages and shall not have the authority to award punitive or exemplary damages, other non-compensatory damages or any other form of relief. Each party shall bear its own costs and attorneys' fees. The arbitrator's decision and award shall be final and binding, and judgment upon the award rendered by the arbitrator may be entered in any court having jurisdiction thereof.
12.4 Judicial or Administrative Action. If any party files a judicial or administrative action asserting claims subject to arbitration, as prescribed herein, and the other party successfully stays such action and/or compels arbitration of said claims, the party filing said action shall pay the other party's costs and expenses incurred in seeking such stay and/or compelling arbitration, including reasonable attorneys' fees.
13.1 Time of the Essence. Time is of the essence with respect to each and every term, condition, obligation and provision hereof, and failure to timely perform or remedy any of the terms, conditions, obligations or provisions hereof by either party shall constitute a material breach of and a noncurable default under this Agreement by the party so failing to perform (but which may be waived by the nonbreaching party).
13.2 Survival of Representations and Warranties. The representations and warranties made herein shall survive the Closing for a period of two (2) years beyond the Closing Date, and thereafter shall terminate.
13.3 Notices. All notices hereunder will be in writing and served by certified mail, return receipt requested. Notice shall be deemed to have been duly given on the date mailed by the notifying party. Notice shall be sent as follows:
| If to Seller: | ATTN: Robert D. Alton, Chief Executive Officer Hickory Tech Corporation 221 East Hickory Street P.O. Box 3248 Mankato, MN 56002-3248 Fax: (507) 625-9191 |
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| with a copy (which shall not constitute notice) to: |
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ATTN: Michael C. Karp Blethen Gage & Krause, PLLP 127 South Second Street P.O. Box 3049 Mankato, MN 56002-3049 Fax: (507) 345-8003 |
| If to Buyer: |
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ATTN: J. R. Brumley South Slope Cooperative Telephone Company 210 Tuttle Street P.O. Box 8 Norway, Iowa 52318-0008 Fax: (319) 227-7700 |
| with a copy (which shall not constitute notice) to: |
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ATTN: M. Daniel Waters Davis, Brown, Koehn, Shors & Roberts, P.C. 666 Walnut Street, Suite 2500 Des Moines, Iowa 50309-3993 Fax: (515) 288-2500 |
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13.4 Waivers. No failure of a party to enforce a provision of this Agreement will be construed as a general or a specific waiver of that provision, or of a party's right to enforce that provision, or of a party's right to enforce any other provision of this Agreement. No waiver of any breach of any covenant or other provision herein contained shall be deemed to be a waiver of any preceding or succeeding breach, or of any other covenant or provision herein contained. No extension of time for performance of any obligation or act shall be deemed to be an extension of the time for performance of any other obligation or act.
13.5 Headings. The subject headings of the sections and subsections of this Agreement are included only for purposes of convenience, and shall not affect the construction or interpretation of any of its provisions.
13.6 Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original, and when each of the parties hereto has executed and delivered to the other party one or more counterparts, this Agreement shall be binding and effective, even though no single counterpart has been executed by both of the parties.
13.7 Successors and Assigns. This Agreement shall be binding on and shall inure to the benefit of the parties hereto and their permitted successors and assigns; provided, however, that no assignment shall be permitted except as provided for in this Agreement.
13.8 Assignment. The rights and obligations of the parties to this Agreement or any interest in this Agreement shall not be assigned, transferred, hypothecated, pledged or otherwise disposed of without the prior written consent of the non-assigning party, which consent may be withheld in such party's sole discretion.
13.9 Additional Instruments and Assistance. Each party hereto shall from time to time execute and deliver such further instruments, provide additional information and render such further assistance as the other party or its counsel may reasonably request in order to complete and perfect the Transactions.
13.10 Governing Law. This Agreement and the legal relations among the parties shall be governed and by construed in accordance with the internal laws of the State of Iowa, without regard to conflict of laws rule. Any action or proceeding to enforce the terms and conditions of this Agreement shall be brought in an Iowa state court of competent jurisdiction, subject to the arbitration provisions of this Agreement.
13.11 Severability. If any term or provision of this Agreement is, to any extent, held or deemed to be invalid or unenforceable when applied to any person or circumstance, the remaining provisions of this Agreement and the enforcement of such provision to other persons or circumstances, or to another extent, shall not be affected thereby, and each provision of this Agreement shall be enforced to the fullest extent allowed by law.
13.12 Amendments. This Agreement may not be modified, changed, supplemented or terminated, nor may any obligations hereunder be waived by a party, except by written instrument signed by the party to be charged or by its agent duly authorized in writing or as otherwise expressly permitted herein.
13.13 No Construction Against the Drafting Party. Each party hereto acknowledges that such party and its counsel have reviewed this Agreement and participated in its drafting. This Agreement shall not be construed against either party for having prepared it.
13.14 Integration. This Agreement, including all schedules and exhibits attached hereto, constitutes the entire agreement between the parties, and there are no agreements, understandings, warranties or representations between the parties except as set forth or noted herein. This Agreement is not made for the benefit of any person, firm, corporation or association other than the parties hereto. The parties do not intend to confer any benefit hereunder on any person, firm or corporation other than the parties hereto.
13.15 Other Negotiations. Seller agrees that pending the Closing hereunder Seller will not enter into any agreement or negotiate with any other person or entity regarding the sale of the Exchange or the Transferred Assets.
13.15 Noncompetition. Seller covenants and agrees that, for a period of three (3) years after the Closing Date, neither Seller nor any firm, corporation, partnership, or other entity directly or indirectly owned, managed, operated, or controlled by Seller, nor any of Seller's shareholders or principal officers or its direct or indirect affiliates, will participate in the ownership, management, operation, or control of any business or organization any part of which engages in the business of operating a telephone or wireless communication system or any other system or service competitive with the Exchange, within twenty (20) miles of the Exchange.
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IN WITNESS WHEREOF, the parties to this Agreement have executed it effective as of the date first above written.
| BUYER: | SELLER: | |||||
| SOUTH SLOPE COOPERATIVE TELEPHONE COMPANY |
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HICKORY TECH CORPORATION |
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By: |
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Richard Netolicky Its President |
Robert D. Alton Its Chief Executive Officer |
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By: |
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Derald Kimm Its Secretary |
David A. Christensen Its Chief Financial Officer |
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| Date: |
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Date: |
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