FYBR Frontier Communications Parent Inc

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(a)  Except as expressly permitted by this Section 5.02, the Company shall and shall cause each of its Subsidiaries and its and their respective directors, officers and employees to, and shall instruct and use reasonable best efforts to cause its other Representatives to, (i)(A) immediately cease any direct or indirect solicitation, discussions, communications or negotiations with, or assistance to, any Persons with respect to any proposal or offer that constitutes, or would reasonably be expected to lead to, a Takeover Proposal and (B) promptly following the date hereof (and in any event within two (2) Business Days) request the prompt return or destruction of all confidential information previously furnished in connection therewith and immediately terminate all physical and electronic data room access previously granted to any such Person or its Representatives, and (ii) not, directly or indirectly, (A) initiate, solicit or knowingly encourage, facilitate or assist in (including by way of furnishing non-public information) the submission of any inquiries regarding, or the making or announcement of any proposal or offer that constitutes, or would reasonably be expected to lead to, a Takeover Proposal, (B) engage in, continue or otherwise participate in any discussions, communications or negotiations regarding (except to notify any Person of the provisions of this Section 5.02), or furnish to any other Person any non-public information or provide access to the properties, books, Contracts, assets, records, personnel or Representatives of the Company and its Subsidiaries in connection with, or for the purpose of, encouraging, facilitating or assisting, the making or announcement of any proposal or offer that constitutes, or would reasonably be expected to lead to, a Takeover Proposal, (C) approve, adopt or enter into, or publicly recommend, endorse or declare advisable any confidentiality agreement (other than an Acceptable Confidentiality Agreement), letter of intent, memorandum of understanding, agreement in principle, merger agreement, acquisition agreement, option agreement, joint venture agreement, partnership agreement or other similar agreement providing for or relating to a Takeover Proposal or (D) waive, terminate, modify, amend, release or assign any provisions of any confidentiality or standstill agreement (or similar agreement) to which it is a party or fail to enforce, to the fullest extent permitted under applicable Law, the provisions of any such agreement (it being understood that the Company shall be entitled to waive or release any preexisting explicit or implicit standstill provisions or similar agreements with any Person or group of Persons to the extent reasonably necessary to allow a third party to make a Takeover Proposal that does not result from a material violation of Section 5.02(a), if the Board of Directors of the Company has determined in good faith, after consultation with its outside legal counsel, that failure to so waive or release such standstill would be inconsistent with its fiduciary duties under applicable Law).

 

(b)  Notwithstanding anything contained in Section 5.02(a), if at any time on or after the date hereof and prior to obtaining the Company Stockholder Approval, the Company or any of its Representatives receives a written Takeover Proposal, which Takeover Proposal did not result from any material breach of Section 5.02(a), (i) the Company and its Representatives may contact and engage in discussions with such Person or group of Persons making the Takeover Proposal or its or their Representatives to the extent reasonably necessary to clarify the terms and conditions thereof or to notify such Person or group of Persons or its or their Representatives of the provisions of this Section 5.02 and (ii) if the Board of Directors of the Company or any duly authorized committee thereof determines in good faith, after consultation with its financial advisors and outside legal counsel, that (A) such written Takeover Proposal constitutes or would reasonably be expected to result in a Superior Proposal and (B) the failure to take the following actions would be inconsistent with the directors’ fiduciary duties under applicable Law (provided that the Company shall promptly (and in any event within twenty-four hours) notify Parent in writing of such determination), then the Company and any of its Representatives may (x) enter into an Acceptable Confidentiality Agreement with the Person or group of Persons making such Takeover Proposal and furnish pursuant to an Acceptable Confidentiality Agreement information (including non-public information) with respect to the Company and its Subsidiaries and/or provide access to the properties, books, Contracts and records of the Company and its Subsidiaries, in each case, to the Person or group of Persons who has made such Takeover Proposal and its or their respective Representatives and financing sources; provided that the Company shall substantially concurrently provide to Parent any material non-public information concerning the Company or any of its Subsidiaries that is provided to any Person given such access which was not previously provided to Parent or its Representatives, and (y) engage in or otherwise participate in discussions or negotiations with the Person or group of Persons making such Takeover Proposal and its or their Representatives.  The Company agrees that it shall not, and shall cause its Subsidiaries not to, enter into any confidentiality or other agreement with any Person (relating to a Takeover Proposal or otherwise) that prohibits or otherwise would prevent the provision of any information to Parent in accordance with, or the Company from otherwise complying with, this Agreement.  The parties hereto acknowledge and agree that any contacts, disclosures, discussions or negotiations permitted under this Section 5.02(b), including any public announcement that the Company or the Board of Directors of the Company has made any determination contemplated under this Section 5.02(b) to take or engage in any such actions, shall not constitute an Adverse Recommendation Change.

 

(c)  Following the date of this Agreement and prior to the Company Stockholder Approval, the Company shall (i) promptly (and in any event within twenty-four hours of receipt by the Company or any of its Subsidiaries or their respective Representatives) notify Parent in the event that the Company or any of its Subsidiaries or its or their Representatives receives a Takeover Proposal or any inquiry or proposal or requests for non-public information or discussions that may reasonably be expected to lead to a Takeover Proposal and shall disclose to Parent the material terms and conditions of any such Takeover Proposal or inquiry or proposal and the identity of the Person or group of Persons making such Takeover Proposal or inquiry or proposal, (ii) keep Parent reasonably informed on a current basis of the status, details and material developments with respect to any such Takeover Proposal or inquiry or proposal (including in each case any material changes thereto) and (iii) provide to Parent as soon as practicable after receipt or delivery thereof (and in any event within twenty-four hours of receipt by the Company or any of its Subsidiaries or their respective Representatives) copies of all correspondence and other written and electronic material exchanged between the Company or any of its Subsidiaries or Representatives and any Person that describes any of the material terms or conditions of any Takeover Proposal or inquiry or proposal.  For the avoidance of doubt, all information provided to Parent pursuant to this Section 5.02(c) will be subject to the terms of the Nondisclosure Agreement.

 

(d)  None of the Board of Directors of the Company or any duly authorized committee thereof shall (i)(A) fail to include the Company Board Recommendation in the Proxy Statement, (B) withdraw or qualify (or modify in a manner adverse to Parent), or publicly propose to withdraw or qualify (or modify in a manner adverse to Parent), the Company Board Recommendation, (C) recommend or endorse the approval or adoption of, or approve, adopt or otherwise declare advisable, or publicly propose to recommend, endorse, approve, adopt or otherwise declare advisable, any Takeover Proposal  or (D) fail to recommend against acceptance by the holders of Company Common Stock of a tender or exchange offer that constitutes a Takeover Proposal within ten (10) Business Days of commencement thereof pursuant to Rule 14d-2 of the Exchange Act, or recommend in favor of, or publicly state that it takes no position with respect to, or that it is unable to take a position with respect to, any such offer (each action described in this clause (i) being referred to as an “Adverse Recommendation Change”), or (ii) execute or enter into (or authorize, publicly recommend, cause or permit the Company or any of its Subsidiaries to execute or enter into) any confidentiality agreement, letter of intent, memorandum of understanding, agreement in principle, merger agreement, acquisition agreement, option agreement, joint venture agreement, partnership agreement or other similar agreement providing for or relating to a Takeover Proposal, other than any Acceptable Confidentiality Agreement (each, a “Company Acquisition Agreement”).  Notwithstanding the foregoing or any other provision of this Agreement to the contrary, prior to obtaining the Company Stockholder Approval, but not after, the Board of Directors of the Company or any duly authorized committee thereof may (I) make an Adverse Recommendation Change in response to an Intervening Event or (II) with respect to a Takeover Proposal that did not result from a material breach of Section 5.02(a), (x) make an Adverse Recommendation Change or (y) terminate this Agreement pursuant to Section 7.01(d)(ii) and cause the Company to enter into a Company Acquisition Agreement with respect to such Takeover Proposal, in either case, if the Board of Directors of the Company or any duly authorized committee thereof has determined in good faith, after consultation with its financial advisors and outside legal counsel, that (x) in the case of clauses (I) and (II), failure to take such action would be inconsistent with the directors’ fiduciary duties under applicable Law and (y) in the case of clause (II), such Takeover Proposal constitutes a Superior Proposal; provided, however, that the Board of Directors of the Company or any duly authorized committee thereof shall not, and shall cause the Company not to, take any action set forth in clause (I) or clause (II), unless (1) the Company has given Parent at least five Business Days’ prior written notice of its intention to take such action (which notice itself shall not constitute an Adverse Recommendation Change, and which notice shall specify the identity of the party making such Superior Proposal and the material terms thereof or, in the case of an Intervening Event, specifying the details thereof), (2) the Company has negotiated, and has caused its Representatives to negotiate, in good faith with Parent during such notice period, to the extent Parent wishes to negotiate, to enable Parent to propose in writing a binding offer to effect revisions to the terms of this Agreement such that it would cause such Takeover Proposal to no longer constitute a Superior Proposal or for such Intervening Event to no longer warrant a Company Adverse Recommendation Change and (3) following the end of such notice period, the Board of Directors of the Company or any duly authorized committee thereof shall have considered in good faith such binding offer, and shall, after consultation with its financial advisors and outside legal counsel, have determined that such Takeover Proposal would continue to constitute a Superior Proposal or that such Intervening Event continues to warrant a Company Adverse Recommendation Change if the revisions proposed in such binding offer were to be given effect (it being understood and agreed that any change to pricing or any other material amendment or revision to the terms of such Takeover Proposal or any material change to the facts and circumstances relating to an Intervening Event, in each case  that was previously the subject of a notice hereunder (if applicable, after having been determined by the Board of Directors of the Company or any duly authorized committee thereof to no longer constitute a Superior Proposal) shall require the Company to deliver a new notice as provided above and provide a new notice period, except that such new notice and matching period in connection with any such amendment or revision shall be for three Business Days rather than five Business Days); provided, further that any purported termination of this Agreement pursuant to this sentence shall be void and of no force and effect unless the termination is in accordance with Section 7.01 and, to the extent required under the terms of this Agreement, the Company pays or causes to be paid to Parent the Company Termination Fee in accordance with Section 7.03 (to the extent due and payable thereunder) prior to or concurrently with such termination so long as Parent has timely provided the Company with wire instructions for such payment.

 

(e)  Nothing in this Section 5.02 or elsewhere in this Agreement shall prohibit the Company or the Board of Directors of the Company or any duly authorized committee thereof from (i) taking and disclosing to the stockholders of the Company a position contemplated by Rule 14e-2(a), Rule 14d-9 or Item 1012(a) of Regulation M-A promulgated under the Exchange Act or (ii) making any disclosure to the stockholders of the Company that is required by applicable Law or if the Board of Directors of the Company or any duly authorized committee thereof determines in good faith, after consultation with the Company’s outside legal counsel, that the failure of the Board of Directors of the Company or any duly authorized committee thereof to make such disclosure would be inconsistent with the directors’ exercise of their duties to the Company’s stockholders under applicable Law; provided that no Company Adverse Recommendation Change shall be made except in compliance with Section 5.02(d).

 

(f)  The Company hereby agrees that (i) any breach of, or failure to comply with, this Section 5.02 by any of its Subsidiaries or its or their respective directors, officers or employees and (ii) any actions taken by the Company’s or its Subsidiaries’ other Representatives that, notwithstanding the Company’s use of its reasonable best efforts in accordance herewith, would constitute a breach or violation of this Section 5.02 if taken by the Company or such Subsidiary, in the case of each of clauses (i) and (ii), shall be deemed a breach of Section 5.02 this Agreement by the Company.

 

(g)  As used in this Agreement, “Acceptable Confidentiality Agreement” means (x) any confidentiality agreement entered into by the Company from and after the date of this Agreement that contains confidentiality provisions that are not materially less favorable in the aggregate to the Company than those contained in the Nondisclosure Agreement, except that such confidentiality agreement need not include explicit or implicit standstill provisions or otherwise restrict the making of or amendment or modification to Takeover Proposals on a confidential basis, but shall not contain any exclusivity provision or other term that would restrict, in any manner, Parent’s ability to consummate the transactions contemplated by this Agreement, or (y) any confidentiality agreement entered into prior to the date of this Agreement, it being understood that the Company shall be entitled to waive or release any preexisting explicit or implicit standstill provisions or similar agreements with any Person or group of Persons to the extent reasonably necessary to allow a third party to make a Takeover Proposal that does not result from a material violation of Section 5.02(a), if the Board of Directors of the Company has determined in good faith, after consultation with its outside legal counsel, that failure to so waive or release such standstill would be inconsistent with its fiduciary duties under applicable Law.

 

(h)  As used in this Agreement, “Intervening Event” means a material event, occurrence, development or state of facts or circumstances that was not known to the Board of Directors of the Company prior to the execution of this Agreement (or if known, the consequences of which were not known or reasonably foreseeable); provided, however, that in no event shall any material event, occurrence, development or state of facts or circumstances resulting from or relating to any of the following give rise to an Intervening Event:  (i) any Takeover Proposal; (ii) the public announcement of discussions among the parties regarding a potential transaction, the public announcement, execution, delivery or performance of this Agreement, the identity of Parent or the public announcement, pendency or consummation of the transactions contemplated hereby; (iii) any change in the trading price or trading volume of shares of Company Common Stock or any change in the Company’s credit rating (although, for purposes of clarity, any underlying facts, events, changes, developments or set of circumstances, with respect to this clause (iii) relating to or causing such change may be considered, along with the effects or consequences thereof); or (iv) the fact that the Company has exceeded or met any projections, forecasts, revenue or earnings predictions or expectations of the Company or any securities analysts for any period ending (or for which revenues or earnings are released) on or after the date hereof (although for purposes of clarity, any underlying facts, events, changes, developments or set of circumstances relating to or causing such material improvement or improvements may be considered, along with the effects or consequences thereof).

 

(i)  As used in this Agreement, “Takeover Proposal” shall mean any inquiry, proposal or offer from any Person or group (other than Parent and its Subsidiaries) relating to, in a single transaction or series of related transactions, any direct or indirect (i) acquisition of 25% or more of the consolidated assets of the Company and its Subsidiaries (based on the fair market value thereof, as determined in good faith by the Board of Directors of the Company or any duly authorized committee thereof), including through the acquisition of one or more Subsidiaries of the Company owning such assets, (ii) acquisition of securities representing 25% or more of the voting power of the then outstanding Company Common Stock, (iii) tender offer or exchange offer that if consummated would result in any Person or group beneficially owning securities representing 25% or more of the voting power of the then outstanding Company Common Stock or (iv) merger, consolidation, share exchange, business combination, recapitalization, liquidation, dissolution or similar transaction involving the Company pursuant to which such Person or group (or the stockholders of any Person) would acquire, directly or indirectly, 25% or more of the consolidated assets of the Company and its Subsidiaries (based on the fair market value thereof, as determined in good faith by the Board of Directors of the Company or any duly authorized committee thereof) or securities representing 25% or more of the aggregate voting power of the Company’s then outstanding securities or of the surviving entity in a merger, consolidation, share exchange or other business combination involving the Company or the resulting direct or indirect parent of the Company or such surviving entity, in each case, other than the Transactions; provided, however, that this Agreement and the Transactions shall not be deemed a Takeover Proposal.

 

(j)  As used in this Agreement, “Superior Proposal” shall mean any bona fide written Takeover Proposal made after the date hereof that the Board of Directors of the Company or any duly authorized committee thereof has determined in its good faith judgment, after consultation with its financial advisors and outside legal counsel, (i) would be more favorable to the Company’s stockholders than the Transactions from a financial point of view and (ii) is reasonably capable of being completed, in each case taking into account all legal, regulatory, financial, financing and other aspects of such proposal and of this Agreement considered relevant by the Board of Directors of the Company or any duly authorized committee thereof; provided that for purposes of the definition of “Superior Proposal”, the references to “25%” in the definition of Takeover Proposal shall be deemed to be references to “50%”.

 

SECTION 5.03.  Efforts.  Subject to the terms and conditions of this Agreement (including Section 5.03(e)), each of the parties hereto shall cooperate with the other parties and use (and shall cause their respective Affiliates to use) reasonable best efforts (unless, with respect to any action, another standard of performance is expressly provided for herein) to (i) take, or cause to be taken, all actions, and do, or cause to be done, and assist and cooperate with the other parties hereto in doing, all things necessary, proper or advisable to cause the conditions to Closing to be satisfied as promptly as reasonably practicable and to consummate and make effective the Transactions, including preparing and filing promptly and fully all documentation to effect all necessary, proper and advisable filings, notices, petitions, statements, registrations, declarations, submissions of information, applications, reports and other documents, (ii) obtain all approvals, consents, registrations, waivers, permits, authorizations, exemptions, clearances, orders and other confirmations from any Governmental Authority or third party necessary, proper or advisable to consummate the Transactions, including the Regulatory Approvals, (iii) execute and deliver any additional instruments necessary to consummate the Transactions and (iv) defend or contest in good faith any Action brought by any Governmental Authority or a third party or any Judgment against any party hereto or any of its Subsidiaries that would prevent or impede, interfere with, hinder or delay in any material respect the consummation of the Transactions.

 

(b)  In furtherance and not in limitation of the foregoing, the Company and Parent shall each use (and shall cause their respective Affiliates to use) reasonable best efforts to (i) take all action necessary to ensure that no Takeover Law restricting or prohibiting any of the Transactions is or becomes applicable to any of the Transactions and (ii) if the restrictions of any Takeover Law become applicable to any of the Transactions, take all action necessary to ensure that the Transactions may be consummated as promptly as practicable on the terms contemplated by this Agreement

 

(c)  Parent shall exclusively control (but shall consult with the Company with respect to) (i) the timing and strategy for obtaining any approvals, consents, registrations, waivers, permits, authorizations, exemptions, clearances, orders and other confirmations from any Governmental Authority in connection with the Transactions and (ii) the overall development of the positions to be taken and the regulatory actions to be requested in any filing or submission with any Governmental Authority in connection with the Transactions and in connection with any investigation or other inquiry or Action by or before, or any negotiations with, any Governmental Authority relating to the Transactions and of all other regulatory matters incidental thereto.

 

(d)  In furtherance and not in limitation of the foregoing, each of the parties hereto agrees to (i) make (and cause their respective Affiliates to make) an appropriate filing of a Notification and Report Form pursuant to the HSR Act with respect to the Transactions no later than December 31, 2024, (ii) file any notification or application required to obtain the FCC Approval with respect to the Transactions as promptly as practicable (and in any event within 45 calendar days following the date hereof), (iii) file any notification or application required for the California PUC Approval with respect to the Transactions as promptly as practicable (and in any event within 45 calendar days following the date hereof), and (iv) file as promptly a reasonably practicable any other notification or application required to obtain any other clearance, approval or consent required in connection with the Transactions from any other Governmental Authority, in the case of each of the foregoing clauses (i)-(iv), unless otherwise agreed by the parties hereto.  Each of the Company, Parent and Merger Sub shall use its reasonable best efforts to supply (and cause their respective Affiliates to supply) as promptly as reasonably practicable any additional information and documentary material that may be reasonably requested by the relevant Governmental Authority with respect to the Antitrust Laws or the Communications Laws or in connection with the foregoing filings, notices, applications and notifications following submission thereof (subject, for the avoidance of doubt, to applicable confidentiality obligations).  Parent will pay, or cause to be paid, all filing fees incurred pursuant to this Section 5.03(d).

 

(e)  Without limiting the foregoing, Parent shall use reasonable best efforts to take (and shall cause its Affiliates to use reasonable best efforts to take) all actions necessary to secure (i) the expiration or termination of any applicable waiting period under the HSR Act or any other Antitrust Law and resolve any objections asserted with respect to, and avoid and eliminate each and every impediment to the consummation of, the Transactions under Antitrust Laws, and (ii) the FCC Approval, any State PUC Approval or Local Franchise Authority Approval, or any other applicable Law raised by any Governmental Authority, in each case of clauses (i) and (ii), in order to (I) prevent the entry of, or to have vacated, lifted, reversed or overturned, any Restraint that would prevent, prohibit, restrict or delay the consummation of the Transactions; and (II) obtain all approvals, consents, registrations, waivers, permits, authorizations, exemptions, clearances, orders and other confirmations from any Governmental Authority necessary to consummate the Transactions, including, in each case, (A) (1) executing settlements, undertakings, consent decrees, stipulations or other agreements with any Governmental Authority or with any other Person, (2) selling, divesting or otherwise conveying or holding separate particular assets or categories of assets or businesses of Parent, its Subsidiaries or any Affiliate of the foregoing, (3) agreeing to sell, divest or otherwise convey or hold separate any particular assets or categories of assets or businesses of the Company and its Subsidiaries contemporaneously with or subsequent to the Effective Time, (4) permitting the Company to sell, divest or otherwise convey or hold separate any of the particular assets or categories of assets or businesses of the Company or any of its Subsidiaries prior to the Effective Time or (5) agreeing to any other commitments, restrictions or modifications on the business or operations of the Company, Parent or any of their respective Affiliates (and, in each case, entering into agreements or stipulating to the entry of any Judgment by, or filing appropriate applications with, the Federal Trade Commission (the “FTC”), the Antitrust Division of the Department of Justice (the “DOJ”) or any other Governmental Authority under the Antitrust Laws, or the FCC, Team Telecom, the State PUCs or the Local Franchise Authorities, in connection with any of the foregoing and, in the case of actions by or with respect to the Company, by consenting to such action by the Company (including any consents required under this Agreement with respect to such action); provided that any such action shall be conditioned upon the Closing) (the actions described in the foregoing clause (A), the “Remedy Actions”), and (B) defending through litigation any claim asserted in court or administrative or other tribunal by or before any Governmental Authority in order to avoid the entry of, or to have vacated or terminated, any Restraint, whether temporary, preliminary or permanent, that would prevent the Closing on or prior to the Outside Date. Notwithstanding the foregoing or anything to the contrary contained in this Agreement, in no event shall (x) Parent or any of its Affiliates be required to take any actions (including any Remedy Actions) or agree to any restrictions, conditions, restraints or concessions (including any Remedy Actions), in each case with respect to Parent, the Company or any of their respective Affiliates (in each case, including the assets, business or operations thereof) that would, individually or in the aggregate, have or reasonably be expected to have, a material adverse effect (taking into account the expected costs and benefits thereof) on (1) the Company and its Subsidiaries, taken as a whole, or (2) Parent and its Subsidiaries, taken as a whole (whether prior to or following the Merger, including the Surviving Corporation and its Subsidiaries), in each case, with materiality determined by reference to a business the size of the Company and its Subsidiaries, taken as a whole (any such actions (including any Remedy Actions) or restrictions, conditions, restraints or concessions (including any Remedy Actions), individually or in the aggregate, satisfying the standard in this clause (x), a “Burdensome Condition”) and (y) the Company and any of its Subsidiaries and their respective Affiliates shall not be permitted to, without Parent’s prior written consent, take, make or otherwise permit itself to be subject to any Remedy Action in connection with securing the expiration or termination of any applicable waiting period under the HSR Act or any other Antitrust Law, resolving any objections asserted with respect to, or avoiding and eliminating any impediment to, the consummation of, the Transactions under Antitrust Laws, or with respect to the FCC Approval, any State PUC Approval or any Local Franchise Authority Approval, or any other applicable Law raised by any Governmental Authority.  Nothing in this Agreement shall require any party to take or agree to take any action with respect to its business or operations unless the effectiveness of such agreement or action is conditioned upon the Closing.  The Company shall not commit (and shall cause its Affiliates not to commit) to or agree with any Governmental Authority to (i) stay, toll or extend any applicable waiting period under the HSR Act or any other Antitrust Laws or in connection with the FCC Approval, any State PUC Approval or any Local Franchise Authority Approval or enter into a timing agreement, understanding or commitment with any Governmental Authority in connection with the foregoing, or (ii) withdraw (including, for the avoidance of doubt, by withdrawing and immediately re-filing) any application, filing or other submission in respect of the FCC Approval, any State PUC Approval or any Local Franchise Authority Approval, in each case of the foregoing clauses (i) and (ii), without the prior written consent of Parent.  With respect to any action referenced in the foregoing sentence that is taken by Parent or Merger Sub, Parent (A) shall consult with the Company and (B) shall not take any such action that would be reasonably expected to cause such approvals not to be obtained by the Outside Date.

 

(f)  Each of the Company, Parent and Merger Sub shall not enter into any material transaction relating to the acquisition of any business, assets, equity interests or property of another Person with the intention to, or that would be reasonably likely to, (i) materially hinder or delay the expiration or termination of any waiting period under the HSR Act or the obtaining of approval of the Antitrust Division of the DOJ or FTC as necessary, or any other Governmental Authority under any other Antitrust Laws or  receipt of the Required Regulatory Approvals or (ii) otherwise materially delay the consummation of the Transactions contemplated by this Agreement.

 

(g)  In furtherance and not in limitation of (but subject to the limitations in) the foregoing, each of the parties hereto shall use (and shall cause their respective Affiliates to use) reasonable best efforts to (i) promptly cooperate in all respects with each other in connection with any necessary, proper or advisable submissions, consents, approvals, filings, petitions, statements, licenses, permits, authorizations, declarations, notifications, registrations, submissions of information, applications, reports, waivers, exemptions, clearances, orders, confirmations and other documents with the FTC, DOJ, FCC, Team Telecom, the State PUCs, the Local Franchise Authorities or any other Governmental Authority in connection with the Transactions and in connection with any investigation or other inquiry by or before the FTC, DOJ, FCC, Team Telecom, the State PUCs, the Local Franchise Authorities or any other Governmental Authority relating to the Transactions, (ii) keep the other parties hereto informed in all material respects and on a reasonably timely basis of any material written or verbal communication received by such party from, or given by such party to, the FTC, DOJ, FCC, Team Telecom, the State PUCs, the Local Franchise Authorities or any other Governmental Authority (including by promptly sending the other parties a copy of all documents, written information, correspondence or other written communications) regarding any of the Transactions, (iii) subject to applicable Laws and the Nondisclosure Agreement relating to the exchange of information, and to the extent reasonably practicable, promptly consult with the other parties hereto with respect to information relating to the other parties hereto and their respective Subsidiaries, as the case may be, that appears in any filing made with, or written materials submitted to, the FTC, DOJ, FCC, Team Telecom, the State PUCs, the Local Franchise Authorities or any other Governmental Authority in connection with the Transactions, other than “Item 4 documents” as that term is used in the rules and regulations under the HSR Act, (iv) to the extent permitted by the FTC, DOJ, FCC, Team Telecom, the State PUCs, the Local Franchise Authorities or such other applicable Governmental Authority or other Person, give the other parties hereto the opportunity to attend and participate in any meeting or conference (whether in person, by telephone or otherwise) in connection with the Transactions, and (v) promptly obtain all consents, registrations, waivers, exemptions, approvals, confirmations, clearances, permits, certificates, orders, and authorizations necessary, proper or advisable to be obtained from, or renewed with, the FTC, DOJ, FCC, Team Telecom, the State PUCs, the Local Franchise Authorities and any other Governmental Authority.  Prior to submitting any document or any information relating to the Transactions or the parties (whether formally or informally, in draft form or final form) to the FTC, DOJ, FCC, Team Telecom, the State PUCs, the Local Franchise Authorities or any other Governmental Authority, a party shall send the other parties such document or information reasonably in advance of such submission and consider in good faith any comments made by the other party; provided that no such document or information shall be submitted by the Company to the FTC, DOJ, FCC, Team Telecom, the State PUCs, the Local Franchise Authorities or any other Governmental Authority relating to the Transactions without the prior written consent of Parent (such consent not to be unreasonably withheld, delayed or conditioned).

 

(h)  Notwithstanding anything to the contrary in this Section 5.03, each of the parties hereto (and each of their respective Affiliates) may, as each reasonably deems necessary or advisable:  (i) designate any competitively sensitive material provided to the others under this Section 5.03 as “outside counsel only” and such materials and the information contained therein shall be given only to the outside legal counsel of the recipient and will not be disclosed by such outside counsel to employees, officers or directors of the recipient and will not be disclosed by such outside counsel to employees, officers or directors of the recipient unless express written consent is obtained in advance from the source of the materials; (ii) redact documents and information as necessary to comply with contractual obligations, as necessary to avoid adversely impacting or jeopardizing any legal privilege or work product doctrine or as necessary to protect personal information; and (iii) exclude the others from any meeting or conference (whether in person, by telephone or otherwise) with any Governmental Authority to the extent it addresses any matters related to any information of the nature contemplated by the foregoing clauses (i) and (ii).

 

(i)  The Company shall (and shall cause its Affiliates to), in consultation with Parent, provide the notices and use commercially reasonably efforts to obtain the consents, waivers, approvals, confirmations and authorizations required to be set forth on Section 3.03(d) of the Company Disclosure Letter, unless otherwise agreed by Parent.

 

SECTION 5.04.  Public Announcements.  Unless and until an Adverse Recommendation Change has occurred, Parent and the Company shall consult (and shall cause their respective Representatives to consult) with each other before issuing, and give each other the opportunity to review and comment upon (which comments each party shall take into account in good faith), any press release or other public statements with respect to the Transactions, and shall not issue any such press release or make any such public statement prior to such consultation, except as may be required by applicable Law, Judgment, court process or the rules and regulations of any national securities exchange or national securities quotation system and except for any matters referred to in Section 5.02.  The parties hereto agree that the initial press release to be issued with respect to the Transactions following execution of this Agreement shall be in the form heretofore agreed to by the parties hereto (the “Announcement”).  Notwithstanding the foregoing, this Section 5.04 shall not apply to any press release or other public statement made by the Company or Parent which is consistent with the Announcement and the terms of this Agreement and does not contain any information relating to the Company, Parent or the Transaction that has not been previously announced or made public in accordance with the terms of this Agreement.

 

SECTION 5.05.  Access to Information; Confidentiality.  Subject to applicable Law and any applicable Judgment, between the date of this Agreement and the earlier of the Effective Time and the termination of this Agreement pursuant to Section 7.01, upon reasonable notice, the Company shall afford to Parent and Parent’s Representatives reasonable access during normal business hours to the Company’s and its Subsidiaries’ officers, employees, agents, properties, books, Contracts and records (other than any of the foregoing that relate to the negotiation and execution of this Agreement, or, except as expressly provided in Section 5.02, to any Takeover Proposal or any other transactions potentially competing with or alternative to the Transactions or proposals from other parties relating to any competing or alternative transactions or relating to any deliberation of the Board of Directors of the Company or any duly authorized committee thereof regarding any Takeover Proposal or Adverse Recommendation Change) and the Company shall furnish promptly to Parent, and Parent’s Representatives such information concerning its and its Subsidiaries’ business, personnel, assets, liabilities and properties as Parent may reasonably request (other than any information that the Company determines in its reasonable judgment relates to the negotiation and execution of this Agreement, or, except as expressly provided in Section 5.02, to any Takeover Proposal or any other transactions potentially competing with or alternative to the Transactions or proposals from other parties relating to any competing or alternative transactions or relating to any deliberation of the Board of Directors of the Company or any duly authorized committee thereof regarding any Takeover Proposal or Adverse Recommendation Change), in each case, in connection with the consummation of the Transactions (including for integration planning); provided that Parent and its Representatives shall conduct any such activities in such a manner as not to interfere unreasonably with the business or operations of the Company; provided, however, that the Company shall not be obligated to provide such access or information if the Company determines, in its reasonable judgment, that doing so would reasonably be expected to (i) result in the disclosure of Trade Secrets or competitively sensitive information to third parties, (ii) violate applicable Law, an applicable Judgment or a Contract or obligation of confidentiality owing to a third party, (iii) jeopardize the protection of an attorney-client privilege, attorney work product protection or other legal privilege, (iv) be materially adverse to the interests of the Company or any of its Subsidiaries in any pending or threatened Action, or (v) involve any environmental or other sampling or testing (provided, that the Company shall use commercially reasonable efforts to disclose any such information in a way that would avoid the consequences described in the foregoing).  All requests for information made pursuant to this Section 5.05 shall be directed to the executive officer or other Person designated by the Company.  Until the Effective Time, all information provided will be subject to the terms of the nondisclosure agreement dated as of December 6, 2023, by and between the Company and Parent (the “Nondisclosure Agreement”).

 

SECTION 5.06.  Indemnification and Insurance.  (a) From and after the Effective Time, each of Parent and the Surviving Corporation shall, and Parent shall cause the Surviving Corporation to, in each case, to the fullest extent permitted by applicable Law, (i) indemnify and hold harmless each current or former director or officer of the Company and its Subsidiaries and each other Person who at the Effective Time is, or at any time prior to the Effective Time was, indemnified or entitled to be indemnified by the Company or its Subsidiaries pursuant to the Company Charter Documents and the organizational documents of such Subsidiaries as in effect on the date of this Agreement or in any other agreement in existence as of the date of this Agreement providing for indemnification or advancement of expenses between the Company or any of its Subsidiaries and such Person (each, an “Indemnitee”) with respect to all claims, liabilities, losses, damages, judgments, fines, penalties, costs (including amounts paid in settlement or compromise) and expenses (including fees and expenses of legal counsel) in connection with any Action (whether civil, criminal, administrative or investigative), whenever asserted, based on or arising out of, in whole or in part, (A) the fact that an Indemnitee is or was a member, director, manager, officer, employee or agent of the Company or such Subsidiary or (B) acts or omissions by an Indemnitee in the Indemnitee’s capacity as a member, director, manager, officer, employee or agent of the Company or such Subsidiary or taken at the request of the Company or such Subsidiary (including in connection with serving at the request of the Company or such Subsidiary as a representative of another Person (including any employee benefit plan)), in each case under clause (A) or (B), at, or at any time prior to, the Effective Time (including any Action relating in whole or in part to the Transactions or relating to the enforcement of this provision or any other indemnification or expense advancement right of any Indemnitee) and (ii) assume (in the case of the Surviving Corporation, in the Merger without any further action) all obligations of the Company and such Subsidiaries to the Indemnitees in respect of indemnification, advancement of expenses and exculpation from liabilities for acts or omissions occurring at or prior to the Effective Time as provided in the Company Charter Documents and the organizational documents of such Subsidiaries as in effect on the date of this Agreement or in any agreement in existence as of the date of this Agreement providing for indemnification or advancement of expenses between the Company or any of its Subsidiaries and any Indemnitee.

 

(b)  Without limiting the foregoing, from and after the Effective Time, to the fullest extent permitted by applicable Law, Parent shall cause the certificate of incorporation and bylaws of the Surviving Corporation, and the Surviving Corporation shall cause the organizational documents of its Subsidiaries, to contain provisions no less favorable to the Indemnitees with respect to limitation of liabilities, indemnification and exculpation, in each case, of members, managers, directors and officers than are set forth as of the date of this Agreement in the Company Charter Documents and the organizational documents of such Subsidiaries as in effect on the date of this Agreement, which provisions shall not be amended, repealed or otherwise modified in a manner that would adversely affect the rights thereunder of any of the Indemnitees.  In addition, from and after the Effective Time, Parent shall, and shall cause the Surviving Corporation to, without requiring a preliminary determination of entitlement to indemnification, advance any reasonable and documented out of pocket expenses (including reasonable fees and expenses of legal counsel) of any Indemnitee under this Section 5.06 (including in connection with enforcing the indemnity and other obligations referred to in this Section 5.06) as incurred to the fullest extent permitted under applicable Law; provided, however, that, as a condition thereto, such Indemnitee shall be required to provide a written undertaking to repay such amounts if it is ultimately determined that such Indemnitee is not entitled to be indemnified under applicable Law.

 

(c)  None of Parent, the Surviving Corporation or any of its Subsidiaries shall settle, compromise or consent to the entry of any judgment in any threatened or actual litigation, claim or proceeding relating to any acts or omissions covered under this Section 5.06 (each, a “Claim”) for which indemnification would reasonably be expected to be sought by an Indemnitee hereunder, unless such settlement, compromise or consent includes an unconditional release of such Indemnitee from all liability arising out of such Claim or such Indemnitee otherwise consents in writing to such settlement, compromise or consent.

 

(d)  For the six-year period commencing immediately after the Effective Time, the Surviving Corporation shall maintain in effect the Company’s current directors’ and officers’ liability insurance covering acts or omissions occurring at or prior to the Effective Time with respect to those individuals who are currently (and any additional individuals who prior to the Effective Time become) covered by the Company’s directors’ and officers’ liability insurance policies on terms and scope with respect to such coverage, and in an amount, no less favorable to such individuals than those of such policy in effect on the date of this Agreement (or Parent may substitute therefor policies, issued by reputable insurers, of at least the same coverage with respect to matters existing or occurring prior to the Effective Time, including a “tail” policy); provided, however, that the Surviving Corporation shall not be required to pay an annual premium for such insurance policy in excess of 300% of the current annual premium paid by the Company for such insurance.  The Company shall have the right prior to the Effective Time to purchase a six-year prepaid “tail policy” on terms and conditions providing at least substantially equivalent benefits as the current policies of directors’ and officers’ liability insurance maintained by the Company and its Subsidiaries with respect to matters existing or occurring prior to the Effective Time, covering without limitation the Transactions, subject to the cap on the annual premium set forth in the proceeding sentence.  If such prepaid “tail policy” has been obtained by the Company, it shall be deemed to satisfy all obligations to obtain insurance pursuant to this Section 5.06(c) and the Surviving Corporation shall use reasonable best efforts to cause such policy to be maintained in full force and effect, for its full term, and to honor all of its obligations thereunder.

 

(e)  The provisions of this Section 5.06 are (i) intended to be for the benefit of, and shall be enforceable by, each Indemnitee, his or her heirs and his or her representatives and (ii) in addition to, and not in substitution for, any other rights to indemnification or contribution that any such Indemnitee may have under the Company Charter Documents, under the organizational documents of the Company’s Subsidiaries as in effect on the date of this Agreement or by contract or otherwise.  The obligations of Parent and the Surviving Corporation under this Section 5.06 shall not be terminated or modified in such a manner as to adversely affect the rights of any Indemnitee to whom this Section 5.06 applies unless (x) such termination or modification is required by applicable Law or (y) the affected Indemnitee shall have consented in writing to such termination or modification (it being expressly agreed that the Indemnitees to whom this Section 5.06 applies shall be third-party beneficiaries of this Section 5.06).

 

(f)  In the event that (i) Parent, the Surviving Corporation or any of their respective successors or assigns (A) consolidates with or merges into any other Person and is not the continuing or surviving corporation or entity of such consolidation or merger or (B) transfers or conveys all or substantially all of its properties and assets to any Person, or (ii) Parent or any of its successors or assigns dissolves the Surviving Corporation, then, in each such case, proper provision shall be made so that the successors and assigns of Parent or the Surviving Corporation shall assume all of the obligations thereof set forth in this Section 5.06.

 

(g)  Nothing in this Agreement is intended to, shall be construed to or shall release, waive or impair any rights to directors’ and officers’ insurance claims under any policy that is or has been in existence with respect to the Company or any of its Subsidiaries for any of their respective directors, officers or other employees, it being understood and agreed that the indemnification provided for in this Section 5.06 is not prior to or in substitution for any such claims under such policies.

 

(h)  Parent’s and the Surviving Corporation’s obligations under this Section 5.06 shall continue in full force and effect for a period of six years from the Effective Time; provided, however, that if any Claim (whether arising before, at or after the Effective Time) is brought against an Indemnitee on or prior to the sixth anniversary of the Effective Time, the provisions of this Section 5.06 shall continue in effect until the full and final resolution of such Claim.

 

SECTION 5.07.  Employee Matters.  (a) For a period of twelve (12) months following the Effective Time, or if earlier, until the date of termination of the relevant Continuing Employee, (such period, the “Comparability Period”), Parent shall, and shall cause the Surviving Corporation and its Subsidiaries to, provide the following to each Person who is an employee of the Company or any of its Subsidiaries immediately prior to the Effective Time (each, a “Continuing Employee”): (i) a base salary or wage rate, target annual cash bonus or commission-based opportunity, and target equity award opportunity, that are no less favorable, in each case, than those in effect immediately prior to the Effective Time, (ii) severance benefits to each Continuing Employee whose employment terminates during the Comparability Period in a manner that qualifies for such severance benefits that are no less favorable than those that would have been provided to such Continuing Employee under the applicable severance benefit plans, programs, policies, agreements and arrangements as in effect immediately prior to the Effective Time (after giving effect to any provisions relating to a “change in control”, “change of control” or other term of similar import), all of which are listed on Section 5.07(a) of the Company Disclosure Letter, and (iii) employee benefit plans and arrangements (other than (x) as provided in clause (i) and (ii), (y) defined benefit pension, supplemental retirement, post-retirement medical and life, and deferred compensation benefits and (z) change-in-control benefits, rights and features) to each Continuing Employee that are no less favorable in the aggregate than those provided to such Continuing Employee immediately prior to the Effective Time.  Notwithstanding the foregoing sentence, the terms and conditions of employment of each Continuing Employee whose terms and conditions of employment are subject to a Collective Bargaining Agreement shall be as required pursuant to such Collective Bargaining Agreement, as in effect during the Comparability Period.

 

(b)  Subject to Section 5.07(a), (x) from and after the Effective Time, Parent shall cause the Surviving Corporation (or one or more of its Subsidiaries, as applicable) to assume, honor and provide all the Company Plans in accordance with their terms in effect as of the Effective Time, and (y) Parent acknowledges that either Parent (or one of more of its Subsidiaries) or the Surviving Corporation (or one or more of its Subsidiaries), as applicable, shall be bound by each Collective Bargaining Agreement in accordance with its terms. Parent and the Company hereby acknowledge that the consummation of the Transactions constitutes a “change in control”, “change of control” or other term of similar import for purposes of any Company Plan that contains a definition of “change in control”, “change of control” or other term of similar import, as applicable.

 

(c)  With respect to all employee benefit plans of Parent, the Surviving Corporation and their respective Subsidiaries in which Continuing Employees commence to participate from and after the Effective Time, including any “employee benefit plan” (as defined in Section 3(3) of ERISA) (including any vacation, paid time-off and severance plans), for purposes of determining eligibility to participate, level of benefits, vesting and benefit accruals, each Continuing Employee’s service with the Company or any of its Subsidiaries (as well as service with any predecessor employer of the Company or any such Subsidiary, to the extent service with the predecessor employer was recognized by the Company or such Subsidiary) shall be treated as service with Parent, the Surviving Corporation or any of their respective Subsidiaries; provided, however, that, other than as required by applicable Law or the terms of the relevant employee benefit plan of Parent, such service is not required by this Section 5.07(c) to be recognized to the extent that such recognition would (x) result in any duplication of benefits for the same period of service or (y) cause a Continuing Employee to be eligible for any employee benefit plan of Parent or any of its Subsidiaries (including the Surviving Corporation and its Subsidiaries) as to which participation is closed or frozen.

 

(d)  Without limiting the generality of Section 5.07(a), Parent shall, or shall cause the Surviving Corporation and its Subsidiaries to, waive, or cause to be waived, any pre-existing condition limitations, exclusions, actively-at-work requirements and waiting periods under any welfare benefit plan maintained by Parent, the Surviving Corporation or any of their respective Subsidiaries in which Continuing Employees (and their eligible dependents) will be eligible to participate from and after the Effective Time, except to the extent that such pre-existing condition limitations, exclusions, actively-at-work requirements and waiting periods would not have been satisfied or waived under the comparable Company Plan immediately prior to the Effective Time.  Parent shall, or shall cause the Surviving Corporation and its Subsidiaries to, recognize the dollar amount of all co-payments, deductibles and similar expenses incurred by each Continuing Employee (and his or her eligible dependents) during the calendar year in which the Effective Time occurs for purposes of satisfying such year’s deductible and co-payment limitations under the relevant welfare benefit plans in which they will be eligible to participate from and after the Effective Time.

 

(e)  For each Continuing Employee who is eligible to receive an annual bonus, Parent shall, and shall cause the Surviving Corporation and its Subsidiaries to, pay such Continuing Employee a bonus payment for the year in which the Effective Time occurs in accordance with Section 5.07(e) of the Company Disclosure Letter.

 

(f)  The Company shall provide an updated Employee Census to Parent (i) not later than on a calendar quarterly basis, and (ii) ten (10) Business Days prior to the anticipated Closing Date.

 

(g)  The provisions of this Section 5.07 are solely for the benefit of the parties to this Agreement, and no provision of this Section 5.07 is intended to, or shall constitute the establishment or adoption of, or an amendment to, any employee benefit plan for purposes of ERISA or otherwise, and no current or former employee or any other individual associated therewith shall be regarded for any purpose as a third-party beneficiary of this Agreement or have the right to enforce the provisions hereof. No provision of this Agreement shall alter the at-will status of any current employee or otherwise limit or impair the right of Parent and its Subsidiaries to terminate the employment of any current employee at any time.

 

SECTION 5.08.  Notification of Certain Matters; Stockholder Litigation.  (a) Prior to the Effective Time, Parent shall give prompt notice to the Company, and the Company shall give prompt notice to Parent, of (i) to the extent permitted under applicable Law, any notice or other communication received by such party from any Governmental Authority in connection with this Agreement or the Transactions or from any Person alleging that the consent of such Person is or may be required in connection with the Transactions, if the subject matter of such communication or the failure of such party to obtain such consent could be material to the Company, the Surviving Corporation or Parent and (ii) any Actions commenced or, to such party’s Knowledge, threatened against such party in relation to this Agreement or the Transactions.  Each party shall promptly advise the other of any fact, change, event or circumstance that is reasonably likely to cause the failure of any condition to Closing set forth in Section 6.02 or Section 6.03, as applicable; provided, that any failure to give notice in accordance with the foregoing with respect to any breach shall not in and of itself be deemed to constitute the failure of any condition set forth in Section 6.02 or Section 6.03 to be satisfied.

 

(b)  The Company shall give Parent the opportunity to participate in the defense and settlement of any stockholder litigation against the Company or the Company’s directors relating to this Agreement or the Transactions.  The Company shall not settle or offer to settle any stockholder litigation against the Company or the Company’s directors relating to this Agreement or the Transactions without Parent’s prior written consent (such consent not to be unreasonably withheld, delayed or conditioned).

 

SECTION 5.09.  Merger Sub Expenditures and Distributions.  From the date of this Agreement until the Effective Time, Merger Sub shall not expend funds other than in connection with the Transactions and the payment of related expenses.

 

SECTION 5.10.  Parent Vote. (a) Parent shall vote or cause to be voted any shares of Company Common Stock beneficially owned by it or any of its Affiliates or with respect to which it or any of its Affiliates has the power (by agreement, proxy or otherwise) to cause to be voted, in favor of the approval of this Agreement at any meeting of stockholders of the Company at which this Agreement shall be submitted for approval and at all adjournments or postponements thereof.

 

(b)  Immediately following the execution and delivery of this Agreement, Parent, in its capacity as the sole stockholder of Merger Sub, will execute and deliver to Merger Sub and the Company a written consent adopting this Agreement in accordance with the DGCL.

 

SECTION 5.11.  Stock Exchange De-listing.  Parent and the Company shall use their reasonable best efforts to cause the shares of Company Common Stock to be de-listed from NASDAQ and de-registered under the Exchange Act as soon as reasonably practicable following the Effective Time.

 

SECTION 5.12.  Preparation of the Proxy Statement; Stockholders’ Meeting.  (a) As promptly as reasonably practicable after the execution of this Agreement (but in any event not more than 20 Business Days following the date of this Agreement) and subject to applicable Law, the Company shall prepare the Proxy Statement in preliminary form and file it with the SEC.  Subject to Section 5.02, the Board of Directors of the Company shall make the Company Board Recommendation to the Company’s stockholders and shall include such recommendation in the Proxy Statement.  Parent shall provide to the Company all information concerning Parent, Merger Sub and their respective Affiliates as may be reasonably requested by the Company in connection with the Proxy Statement and shall otherwise assist and cooperate with the Company in the preparation and filing of the Proxy Statement and the resolution of any comments thereto received from the SEC.  Each of the Company, Parent and Merger Sub shall correct any information provided by it for use in the Proxy Statement as promptly as reasonably practicable if and to the extent such information contains any untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading.  The Company shall notify Parent promptly upon the receipt of any comments from the SEC and of any request by the SEC for amendments or supplements to the Proxy Statement and shall supply Parent with copies of all written correspondence between the Company or any of its Representatives, on the one hand, and the SEC, on the other hand, with respect to the Proxy Statement.  The Company shall use its reasonable best efforts to respond as promptly as reasonably practicable to any comments received from the SEC concerning the Proxy Statement and to resolve such comments with the SEC, and shall use its reasonable best efforts to cause the definitive Proxy Statement to be disseminated to its stockholders as promptly as reasonably practicable after the resolution of any such comments.  Prior to any filing of the Proxy Statement (or any amendment or supplement thereto) or any dissemination thereof to the stockholders of the Company, or responding to any comments from the SEC with respect thereto, the Company shall provide Parent with a reasonable opportunity to review and to propose comments on such document or response, which the Company shall consider in good faith.  If at any time prior to the Closing any event or circumstance relating to the Company or any of its Subsidiaries or its or their respective officers or directors should be discovered by the Company which, pursuant to the Exchange Act, should be set forth in an amendment or a supplement to the Proxy Statement, the Company shall promptly inform Parent.  The Company shall cause the Proxy Statement to comply in all material respects with the applicable provisions of the Securities Act and the Exchange Act and the rules and regulations thereunder.

 

(b)  Notwithstanding any Adverse Recommendation Change but subject to Section 5.12(a) and applicable Law and to the extent not prohibited by any Judgment, the Company shall take all necessary actions in accordance with applicable Law, the Company Charter Documents and the rules of NASDAQ to duly call, give notice of, convene and hold a meeting of its stockholders (including any adjournment or recess thereof, the “Company Stockholders’ Meeting”) for the sole purpose of obtaining the Company Stockholder Approval, obtaining advisory approval of the compensation that the Company’s named executive officers may receive in connection with the Merger and voting on a proposal to adjourn the Company Stockholders’ Meeting, as soon as reasonably practicable and in any case no later than 25 Business Days after the SEC confirms that it has no further comments on the Proxy Statement.  Subject to Section 5.02, the Company shall (x) include the Company Board Recommendation in the Proxy Statement, (y) recommend at the Company Stockholders’ Meeting that the holders of Company Common Stock adopt this Agreement and (z) use its reasonable best efforts to obtain the Company Stockholder Approval.  Notwithstanding anything to the contrary contained in this Agreement, the Company may, in its reasonable discretion, adjourn or recess (but not postpone) the Company Stockholders’ Meeting (i) to allow reasonable additional time for the filing or mailing of any supplement or amendment to the Proxy Statement that the Company has determined is reasonably likely to be required under applicable Law and for such supplement or amendment to be disseminated and reviewed by the stockholders of the Company in advance of the Company Stockholders’ Meeting, (ii) to the extent required by a court of competent jurisdiction in connection with any proceedings in connection with this Agreement or the Transactions, (iii) if as of the time for which the Company Stockholders’ Meeting is originally scheduled (as set forth in the Proxy Statement) there are insufficient shares of Company Common Stock represented (either in person or by proxy) to constitute a quorum necessary to conduct the business of the Company Stockholders’ Meeting or (iv) to solicit additional proxies for the purpose of obtaining the Company Stockholder Approval; provided that, in the case of clauses (i), (iii) and (iv), the Company Stockholders’ Meeting (as so adjourned or recessed) shall not be held on a date that is later than thirty (30) days after the date on which the Company Stockholders’ Meeting was originally scheduled (excluding any adjournments required by applicable Law) without the consent of Parent (not to be unreasonably withheld, conditioned or delayed).

 

(c)  Nothing in this Section 5.12 shall be deemed to prevent the Company or the Board of Directors of the Company or any duly authorized committee thereof from taking any action they are permitted or required to take under, and in compliance with, Section 5.02 or applicable Law.

 

SECTION 5.13.  Section 16 Matters.  Prior to the Effective Time, the Company and Parent shall take all actions reasonably necessary or advisable to cause the disposition of equity securities of the Company and any acquisitions of equity securities of Parent (including any derivative securities) pursuant to the Merger and the other Transactions by each individual who is an officer or director of the Company subject to Section 16 of the Exchange Act to be exempt pursuant to Rule 16b-3 promulgated under the Exchange Act.

 

SECTION 5.14.  Financing Assistance and Cooperation.

 

(a)  The Company shall (and shall cause its Subsidiaries to)  use commercially reasonable efforts to provide to Parent, at Parent’s sole cost and expense, all cooperation and assistance that is customary and reasonably requested by Parent in connection with (i) any outstanding Indebtedness of the Company or any of its Subsidiaries or (ii) any financing sought by Parent in connection with the Transactions.

 

(b)  Notwithstanding anything to the contrary contained herein, nothing in this Section 5.14 shall require any such cooperation or assistance to the extent that it could result in the Company or any of its Subsidiaries being required to:

 

(i)  pledge any assets as collateral prior to the Effective Time;

 

(ii)  pay any fee, bear any cost or expense, enter into any definitive agreement that becomes effective prior to Closing, incur any other liability or give any indemnities to any third party or otherwise commit to take any similar action in connection with any financing undertaken by Parent in connection with the Transactions prior to the Closing;

 

(iii)  take any actions to the extent such actions would, in the Company’s reasonable judgment, (A) unreasonably interfere with the ongoing business or operations of the Company or any of its Subsidiaries, (B) subject any director, manager, officer or employee of the Company or any of its Affiliates to any actual or potential personal liability, (C) conflict with, or result in any violation or breach of, or default (with or without notice, or lapse of time or both) under, the organizational documents of the Company or any of its Subsidiaries, any applicable Law or Judgment or any material Contract to which the Company or any of its Subsidiaries is a party or by which any of their respective properties or assets is bound, (D) require any such entity to change any fiscal period or (E) cause (x) any closing condition set forth in Article VI of this Agreement to fail to be satisfied or (y) any other breach of this Agreement;

 

(iv)  waive or amend any terms of this Agreement;

 

(v)  commit to take any action under any certificate, document or instrument that is not contingent upon the Closing;

 

(vi)  provide access to or disclose information that the Company reasonably determines would jeopardize any attorney-client privilege of the Company or its applicable Subsidiary; provided, that the Company or such Subsidiary shall use commercially reasonable efforts to provide an alternative means of disclosing or providing such information;

 

(vii)  cause any director, manager or equivalent, or any officer or employee of the Company or any of its Subsidiaries to pass resolutions to approve any such financing or authorize the creation of any agreements, documents or actions in connection therewith, or to execute or deliver any certificate in connection with any such financing (other than any director, manager or equivalent, or officer or employee of the Company or any of its Subsidiaries who will continue in such a position following the Closing and the passing of such resolutions), in each case that are not contingent on the Closing or would be effective prior to the Closing;

 

(viii)  deliver any legal opinion or negative assurance letter (other than legal opinions or letters required to be delivered in connection with any offer to purchase or exchange, or any consent solicitations with respect to, any outstanding Indebtedness of the Company undertaken in connection with the Transactions and contingent on the Closing, to the extent such opinions or letters would not conflict with applicable Law and would be accurate in light of the facts and circumstances at the time delivered); or

 

(ix)  provide or prepare (A) pro forma financial statements, pro forma adjustments, projections or an as‑adjusted capitalization table, (B) any description of all or any component of any financing undertaken by Parent in connection with the Transactions, including any such description to be included in liquidity and capital resources disclosure or any “description of notes”, (C) risk factors relating to all or any component of the any financing undertaken by Parent in connection with the Transactions, (D) “segment reporting”, subsidiary financial statements or any information of the type required by Rule 3-09, Rule 3-10 or Rule 3-16 of Regulation S-X or (E) any information required by Regulation S-K Item 402 or by Items 10 through 14 of Form 10-K or any other information customarily excluded from an offering memorandum for private placements of non-convertible high-yield bonds pursuant to Rule 144A.

 

(c)  Parent shall promptly, upon request by the Company, reimburse the Company for all reasonable, documented out-of-pocket costs and expenses (including reasonable attorneys’ fees) incurred by the Company or any of its Subsidiaries and their respective Representatives in connection with any financing to be undertaken by Parent in connection with the Transactions, including the cooperation of the Company and its Subsidiaries and Representatives contemplated by this Section 5.14, and shall indemnify and hold harmless the Company, its Subsidiaries and their respective Representatives from and against any and all losses, damages, claims, costs or expenses suffered or incurred by any of them in connection with the arrangement of any financing undertaken by Parent in connection with the Transactions and any information used in connection with the foregoing, except to the extent such liabilities arise from (x) the gross negligence, bad faith or willful misconduct of the Company or any of its Subsidiaries and their respective Representatives, (y) any intentional misrepresentation in any financial statements or information provided by the Company specifically for use in connection with any financing undertaken by Parent in connection with the Transactions or (z) a material breach of this Agreement by the Company, in each case, as determined by a court of competent jurisdiction in a final and non-appealable decision.

 

SECTION 5.15.  Certain Tax Matters.  During the period from the date of this Agreement to the Effective Time, the Company shall promptly notify Parent of any material Action that is initiated, scheduled or pending against or with respect to it or any of its Subsidiaries in respect of any Tax.

 

SECTION 5.16.  Broadband Grants.  To the extent permitted by Law, the Company shall (and cause its Subsidiaries to) use reasonable best efforts to provide Parent written notice of any bid or submission for any Broadband Grant that is accepted.

 

SECTION 5.17.  Certain Agreements.  Prior to the Closing, and as promptly as reasonably practicable following the date hereof, the Company shall (and cause its Subsidiaries to) use reasonable best efforts to terminate all of the Contracts set forth on Section 5.17 of the Company Disclosure Letter.

 

SECTION 6.01.  Conditions to Each Party’s Obligation To Effect the Merger.  The respective obligations of each party hereto to effect the Merger shall be subject to the satisfaction (or written waiver by each party hereto, if permissible under applicable Law) at or prior to the Closing of the following conditions:

 

(a)  No Restraints.  No applicable Law and no Judgment enacted, promulgated, issued, entered, amended or enforced by any Governmental Authority of competent jurisdiction (collectively, “Restraints”) in the U.S. or any jurisdiction set forth in Section 6.01(a) of the Company Disclosure Letter (the “Applicable Jurisdictions”) shall be in effect enjoining, restraining or otherwise making illegal, preventing or prohibiting the consummation of the Merger or the Transactions;

 

(b)  HSR; Required Regulatory Approvals.  (i) The waiting period (and any extension thereof) applicable to the consummation of the Merger under the HSR Act shall have expired or early termination thereof shall have been granted; (ii) the FCC Approval shall have been received; and (iii) the consents, approvals or other clearances set forth in Section 6.01(b) of the Company Disclosure Letter shall have been obtained (the consents, approvals or clearances in clauses (ii) and (iii), collectively, the “Required Regulatory Approvals”).

 

(c)  Company Stockholder Approval.  The Company Stockholder Approval shall have been obtained.

 

SECTION 6.02.  Conditions to the Obligations of Parent and Merger Sub.  The obligations of Parent and Merger Sub to effect the Merger shall be subject to the satisfaction (or written waiver by Parent, if permissible under applicable Law) at or prior to the Closing of the following conditions:

 

(a)  Representations and Warranties.  The representations and warranties of the Company (i) set forth in Section 3.01(a) (Organization; Standing), Section 3.02(c) and (d) (Capitalization), Section 3.03(a), (b) and (c) (Authority), Section 3.19 (No Rights Agreement; Anti-Takeover Provisions) and Section 3.21 (Brokers and Other Advisors) shall be true and correct in all material respects as of the date hereof and as of the Closing Date with the same effect as though made as of the Closing Date (except to the extent expressly made as of an earlier date, in which case as of such earlier date), (ii) set forth in Section 3.02(a) and (b) (Capitalization) shall be true and correct in all respects, except for any inaccuracies that are de minimis, as of the date hereof and as of the Closing Date with the same effect as though made as of the Closing Date (except to the extent expressly made as of an earlier date, in which case as of such earlier date), (iii) set forth in Section 3.06(b) (no Material Adverse Effect) shall be true and correct in all respects as of the date hereof and as of the Closing Date with the same effect as though made as of the Closing Date and (iv) set forth in this Agreement, other than those Sections specifically identified in clauses (i), (ii) and (iii) of this paragraph, shall be true and correct (disregarding all qualifications or limitations as to “materiality”, “Material Adverse Effect” and words of similar import set forth therein) as of the date hereof and as of the Closing Date with the same effect as though made as of the Closing Date (except to the extent expressly made as of an earlier date, in which case as of such earlier date), except, in the case of this clause (iv), where the failure to be true and correct would not, individually or in the aggregate, have a Material Adverse Effect;

 

(b)  Compliance with Covenants.  The Company shall have complied with or performed in all material respects its obligations required to be complied with or performed by it at or prior to the Effective Time under this Agreement;

 

(c)  Company Closing Certificate.  The Company shall have delivered to Parent a certificate, dated as of the Closing Date and signed on behalf of the Company by an executive officer of the Company, certifying that the conditions set forth in Sections 6.02(a) and 6.02(b) have been satisfied; and

 

(d)  Regulatory Approvals.  (i) The approvals contemplated by Section 6.01(b)(i) and the Required Regulatory Approvals shall have been obtained without restrictions, conditions, restraints or concessions (including any Remedy Actions) that constitute, individually or in the aggregate, a Burdensome Condition and (ii) the Required Regulatory Approvals shall have become Final Orders.

 

SECTION 6.03.  Conditions to the Obligations of the Company.  The obligations of the Company to effect the Merger shall be subject to the satisfaction (or written waiver by the Company, if permissible under applicable Law) at or prior to the Closing of the following conditions:

 

(a)  Representations and Warranties.  The representations and warranties of Parent and Merger Sub set forth in this Agreement shall be true and correct in all respects (disregarding all qualifications or limitations as to “materiality”, “Parent Material Adverse Effect” and words of similar import set forth therein) as of the date hereof and as of the Closing Date with the same effect as though made as of the Closing Date (except to the extent expressly made as of an earlier date, in which case as of such earlier date), except where the failure to be true and correct has not had and would not reasonably be expected to have, individually or in the aggregate with all other failures to be true or correct, a Parent Material Adverse Effect;

 

(b)  Compliance with Covenants.  Parent and Merger Sub shall have complied with or performed in all material respects their obligations required to be complied with or performed by them at or prior to the Effective Time under this Agreement; and

 

(c)  Parent Closing Certificate.  Parent shall have delivered to the Company a certificate, dated as of the Closing Date and signed on behalf of Parent and Merger Sub by an executive officer of Parent, certifying that the conditions set forth in Sections 6.03(a) and 6.03(b) have been satisfied.

 

ARTICLE VII

 

 

SECTION 7.01.  Termination.  This Agreement may be terminated, and the Transactions abandoned, at any time prior to the Effective Time (except as otherwise expressly stated herein), whether before or after receipt of the Company Stockholder Approval:

 

(a)  by the mutual written consent of the Company and Parent;

 

(b)  by either of the Company or Parent:

 

(i)  if the Effective Time shall not have occurred on or prior to March 4, 2026 (such date, the “Initial Outside Date”, as it may be extended, the “Outside Date”); provided that (x) if, on the Initial Outside Date, any of the conditions set forth in Section 6.01(b), Section 6.01(a) (to the extent due to a Restraint relating to the HSR Act or the Required Regulatory Approvals) or Section 6.02(d) shall not have been satisfied or waived but all of the other conditions set forth in Article VI have been satisfied or waived (or in the case of conditions that by their nature are to be satisfied at the Closing, shall be capable of being satisfied on such date) (an “Outside Date Extension Event”), then the Initial Outside Date shall automatically be extended to June 4, 2026 (such date, the “First Extended Outside Date”) and (y) if, on the First Extended Outside Date, an Outside Date Extension Event shall exist, then the First Extended Outside Date shall automatically be extended to September 4, 2026; provided, further that the right to terminate this Agreement under this Section 7.01(b)(i) shall not be available to any party if the breach by such party of its representations and warranties set forth in this Agreement or the failure of such party to perform any of its obligations under this Agreement has been the principal cause of the events specified in this Section 7.01(b)(i) (it being understood that Parent and Merger Sub shall be deemed a single party for purposes of the foregoing proviso);

 

(ii)  if any Restraint in the U.S. or any Applicable Jurisdiction having the effect set forth in Section 6.01(a) (Legal Restraints) shall be in effect and shall have become final and nonappealable; provided that the party seeking to terminate this Agreement pursuant to this Section 7.01(b)(ii) shall have complied with its obligations pursuant to Section 5.03 of this Agreement; or

 

(iii)  if the Company Stockholders’ Meeting (including any adjournments thereof) shall have concluded and the Company Stockholder Approval shall not have been obtained;

 

(c)  by Parent:

 

(i)  if the Company shall have breached any of its representations or warranties or failed to perform any of its covenants or agreements set forth in this Agreement, which breach or failure to perform (A) would give rise to the failure of a condition set forth in Section 6.02(a) (Company Representations) or Section 6.02(b) (Company Compliance with Covenants) and (B) is incapable of being cured or, if capable of being cured by the Outside Date, the Company (x) shall not have commenced good-faith efforts to cure such breach or failure to perform within 30 calendar days following receipt by the Company of written notice of such breach or failure to perform from Parent stating Parent’s intention to terminate this Agreement pursuant to this Section 7.01(c)(i) and the basis for such termination or (y) is not thereafter continuing to take good-faith efforts to cure such breach or failure to perform; provided, however, that Parent shall not have the right to terminate this Agreement pursuant to this Section 7.01(c)(i) if Parent or Merger Sub is then in material breach of any of its representations, warranties, covenants or agreements hereunder; or

 

(ii)  if the Board of Directors of the Company or any duly authorized committee thereof shall have made an Adverse Recommendation Change; provided, however, that Parent shall no longer be entitled to terminate this Agreement pursuant to this Section 7.01(c)(ii) if the Company Stockholder Approval is obtained at the Company Stockholders’ Meeting; or

 

(d)  by the Company:

 

(i)  if either of Parent or Merger Sub shall have breached any of its representations or warranties or failed to perform any of its covenants or agreements set forth in this Agreement, which breach or failure to perform (A) would give rise to the failure of a condition set forth in Section 6.03(a) (Parent Representations) or Section 6.03(b) (Parent Compliance with Covenants) and (B) is incapable of being cured or, if capable of being cured by the Outside Date, either Parent or Merger Sub, as applicable (x) shall not have commenced good-faith efforts to cure such breach or failure to perform within 30 calendar days following receipt by Parent of written notice of such breach or failure to perform from the Company stating the Company’s intention to terminate this Agreement pursuant to this Section 7.01(d)(i) and the basis for such termination or (y) is not thereafter continuing to take good-faith efforts to cure such breach or failure to perform; provided, however, that the Company shall not have the right to terminate this Agreement pursuant to this Section 7.01(d)(i) if the Company is then in material breach of any of its representations, warranties, covenants or agreements hereunder; or

 

(ii)  prior to receipt of the Company Stockholder Approval, in connection with entering into a Company Acquisition Agreement in accordance with Section 5.02(d)(II) (Takeover Proposals not solicited in violation of the non-solicitation provisions); provided that prior to or concurrently with such termination the Company pays or causes to be paid the Company Termination Fee to the extent due and payable under Section 7.03(a) so long as Parent has timely provided the Company with wire instructions for such payment.

 

SECTION 7.02.  Effect of Termination.  In the event of the termination of this Agreement as provided in Section 7.01, written notice thereof shall be given to the other party or parties hereto, specifying the provision hereof pursuant to which such termination is made, and this Agreement shall forthwith become null and void (other than Section 5.05 (Access to Information; Confidentiality), this Section 7.02, Section 7.03 (Termination Fees) and Article VIII (Miscellaneous Provisions), all of which shall survive termination of this Agreement), and there shall be no liability on the part of Parent, Merger Sub, the Company or their respective directors, officers and Affiliates, except, subject to Section 7.03(d) (including the limitations on liability set forth therein), no such termination shall relieve any party from liability for damages to another party resulting from a Willful Breach of this Agreement or from Fraud (which liability the parties hereto acknowledge and agree shall not be limited to reimbursement of out-of-pocket fees, costs or expenses incurred in connection with the Transactions, and may include damages based on loss of the economic benefit of the Transactions to the parties hereto and the stockholders of the Company (in each case, taking into consideration all relevant matters, including other business opportunities or combination opportunities and the time value of money)).

 

SECTION 7.03.  Termination Fee.  (a) In the event that:

 

(i)  this Agreement is terminated by the Company or Parent pursuant to Section 7.01(b)(i) (termination after the Outside Date) or Section 7.01(b)(iii) (failure to receive the Company Stockholder Approval) or by Parent pursuant to Section 7.01(c)(i) (uncured breach of the Agreement by the Company); provided that (A) a bona fide Takeover Proposal shall have been publicly made, proposed or communicated by a third party after the date of this Agreement and (B) within twelve (12) months of the date this Agreement is terminated, the Company consummates any Takeover Proposal or enters into a definitive agreement with respect to any Takeover Proposal and such Takeover Proposal is subsequently consummated at any time; provided that, for purposes of clauses (A) and (B) of this Section 7.03(a)(i), the references to “25%” in the definition of Takeover Proposal shall be deemed to be references to “50%”; or

 

(ii)  this Agreement is terminated (A) by Parent pursuant to Section 7.01(c)(ii) (Adverse Recommendation Change) or (B) by the Company pursuant to Section 7.01(d)(ii) (entry into a Company Acquisition Agreement);

 

then, in any such event under clause (i) or (ii) of this Section 7.03(a), the Company shall pay or cause to be paid the Company Termination Fee to Parent or its designee by wire transfer of same-day funds so long as Parent has timely provided the Company with wire instructions for such payment (x) in the case of Section 7.03(a)(ii)(A), within two Business Days after such termination, (y) in the case of Section 7.03(a)(ii)(B), simultaneously with such termination or (z) in the case of Section 7.03(a)(i), concurrently with the consummation of or entry into an agreement with respect to the Takeover Proposal referred to therein; it being understood that in no event shall the Company be required to pay or cause to be paid the Company Termination Fee on more than one occasion.  As used herein, “Company Termination Fee” shall mean a cash amount equal to $320,000,000.

 

(b)  In the event this Agreement is terminated pursuant to (I) Section 7.01(b)(i) (termination on or after the Outside Date) and at the time of such termination all of the conditions set forth in Section 6.01 (Mutual Closing Conditions) and Section 6.02 (Conditions of Parent and Merger Sub to Closing), other than Section 6.02(d), have been satisfied or waived, except for any conditions set forth in (i) Section 6.01(b) (Required Regulatory Approvals) or (ii) Section 6.01(a) (Legal Restraints) (if the failure of such condition is due to any Restraint in the U.S. or any Applicable Jurisdiction) or (II) Section 7.01(d)(i) due to Parent’s breach of its obligations in Section 5.03, then Parent shall pay or cause to be paid to the Company or its designee a termination fee of $590,000,000 in cash (the “Reverse Termination Fee”) by wire transfer of same-day funds so long as Company has timely provided Parent with wire instructions for such payment (x) in the case of termination by the Company, within two Business Days after such termination or (y) in the case of termination by Parent, simultaneously with such termination.  Notwithstanding anything to the contrary in this Agreement, in no event shall Parent be obligated to pay the Reverse Termination Fee more than once.

 

(c)  Each of the parties hereto acknowledges that the agreements contained in this Section 7.03 are an integral part of the Transactions, and that without these agreements, the other parties hereto would not enter into this Agreement.  Accordingly, if the Company or Parent, as the case may be, fails to timely pay or cause to be paid any amount due pursuant to this Section 7.03, and, in order to obtain the payment, Parent or the Company, as the case may be, commences an Action which results in a judgment against the other party, with respect to Parent or Merger Sub, or parties, with respect to the Company, for the payment set forth in this Section 7.03, such paying party shall pay or cause to be paid the other party or parties, as applicable, its or their reasonable and documented costs and expenses (including reasonable and documented attorneys’ fees) in connection with such Action, together with interest on such amount at the prime rate as published in The Wall Street Journal in effect on the date such payment was required to be made through the date such payment was actually received.

 

(d)  Subject in all respects to the Company’s injunction, specific performance and equitable relief rights and related rights set forth in Section 8.08 (which shall be the Company’s sole and exclusive remedy for any breach of Section 5.03 prior to any termination of this Agreement), in circumstances in which a party is entitled to terminate this Agreement and the Company would receive the Reverse Termination Fee pursuant to Section 7.03(b), the Company’s right to receive the Reverse Termination Fee and the reimbursement and indemnification obligations of Parent under Section 7.03(c) shall be the sole and exclusive remedy of the Company and its Subsidiaries against Parent, Merger Sub or any of their respective former, current or future general or limited partners, stockholders, financing sources, managers, members, directors, officers or Affiliates (collectively, the “Parent Related Parties”) for any loss suffered as a result of the failure of the Transactions to be consummated or for a breach or failure to perform hereunder or otherwise relating to or arising out of this Agreement or the Transactions, and upon payment of such amount none of the Parent Related Parties shall have any further liability or obligation relating to or arising out of this Agreement or the Transactions. Subject in all respects to Parent’s injunction, specific performance and equitable relief rights and related rights set forth in Section 8.08 (which shall be Parent’s sole and exclusive remedy for any breach of Section 5.02 prior to any termination of this Agreement), in circumstances in which a party is entitled to terminate this Agreement and Parent would receive the Company Termination Fee pursuant to Section 7.03(a), Parent’s right to receive the Company Termination Fee and the reimbursement and indemnification obligations of the Company under Section 7.03(c) shall be the sole and exclusive remedy of the Parent Related Parties against the Company and its Subsidiaries and any of their respective former, current or future officers, directors, partners, stockholders, managers, members or Affiliates (collectively, “Company Related Parties”) for any loss suffered as a result of the failure of the Transactions to be consummated or for a breach or failure to perform hereunder or otherwise, and upon payment of such amount none of the Company Related Parties shall have any further liability or obligation relating to or arising out of this Agreement or the Transactions. While each of the Company and Parent may pursue both a grant of specific performance in accordance with Section 8.08 and the payment of the Reverse Termination Fee or the Company Termination Fee, as applicable, under Section 7.03, under no circumstances shall the Company or Parent be permitted or entitled to receive both a grant of specific performance that results in the Closing and any money damages, including all or any portion of the Reverse Termination Fee or the Company Termination Fee, as applicable.

 

ARTICLE VIII

 

 

SECTION 8.01.  No Survival of Representations and Warranties.  None of the representations or warranties in this Agreement or in any document or instrument delivered pursuant to or in connection with this Agreement shall survive the Effective Time.  This Section 8.01 shall not limit any covenant or agreement contained in this Agreement or in any document or instrument delivered pursuant to or in connection with this Agreement that by its terms applies in whole or in part after the Effective Time, which shall survive to the extent expressly provided for herein or therein.

 

SECTION 8.02.  Amendment or Supplement.  Subject to compliance with applicable Law, at any time prior to the Effective Time, this Agreement may be amended or supplemented in any and all respects by written agreement of the parties hereto; provided, however, that following receipt of the Company Stockholder Approval, there shall be no amendment or change to the provisions hereof which by Law would require further approval by the stockholders of the Company without such approval having first been obtained.

 

SECTION 8.03.  Extension of Time, Waiver, etc.  At any time prior to the Effective Time, either Parent or the Company may, subject to applicable Law, (a) waive any inaccuracies in the representations and warranties of the other party contained herein or in any document delivered pursuant hereto, (b) extend the time for the performance of any of the obligations or acts of the other party or (c) waive compliance by the other party with any of the agreements contained herein applicable to such party or, except as otherwise provided herein, waive any of such party’s conditions (it being understood that Parent and Merger Sub shall be deemed a single party for purposes of the foregoing clauses (a) through (c)); provided, however, that following receipt of the Company Stockholder Approval, there shall be no waiver or extension of this Agreement that would require further approval of the stockholders of the Company.  Notwithstanding the foregoing, no failure or delay by the Company, Parent or Merger Sub in exercising any right hereunder shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right hereunder.  Any agreement on the part of a party hereto to any such extension or waiver shall be valid only if set forth in an instrument in writing signed on behalf of such party.

 

SECTION 8.04.  Assignment.  Neither this Agreement nor any of the rights, interests or obligations hereunder shall be assigned, in whole or in part, by operation of Law or otherwise, by any of the parties hereto without the prior written consent of the other parties hereto (such consent not to be unreasonably withheld, delayed or conditioned); provided that Parent shall be permitted to assign, in whole or in part, any of its rights or interests (but not obligations) under this Agreement to one or more of its Subsidiaries without the consent of the Company so long as (x) such assignment would not result in a Parent Material Adverse Effect and (y) such Subsidiary is a United States person within the meaning of Section 7701(a)(30) of the Code.  No assignment by any party shall relieve such party of any of its obligations hereunder.  Subject to the immediately preceding two sentences, this Agreement shall be binding upon, inure to the benefit of, and be enforceable by, the parties hereto and their respective successors and permitted assigns.  Any purported assignment not permitted under this Section 8.04 shall be null and void.

 

SECTION 8.05.  Counterparts.  This Agreement may be executed in one or more counterparts (including by facsimile, electronic signature, PDF or electronic mail), each of which shall be deemed to be an original but all of which taken together shall constitute one and the same agreement and shall become effective when one or more counterparts have been signed by each of the parties hereto and delivered to the other parties hereto.

 

SECTION 8.06.  Entire Agreement; No Third-Party Beneficiaries.  This Agreement and the schedules and exhibits attached hereto and thereto, together with the Nondisclosure Agreement, constitutes the entire agreement, and supersedes all other prior agreements and understandings, both written and oral, among the parties and their Affiliates, or any of them, with respect to the subject matter hereof and thereof.  Notwithstanding anything in this Agreement to the contrary, the parties hereto acknowledge and agree that the Company Disclosure Letter is “facts ascertainable” as that term is used in Section 251(b) of the DGCL and does not form part of this Agreement but instead operates upon the terms of this Agreement as provided herein. This Agreement is not intended to and does not confer upon any Person other than the parties hereto any rights or remedies hereunder, except for:  (i) if the Effective Time occurs, the right of the Company’s stockholders to receive the Merger Consideration as provided in Section 2.01; (ii) if the Effective Time occurs, the right of the holders of Equity-Based Awards to receive such amounts as provided for in Article II; (iii) if the Effective Time occurs, the rights of the Indemnitees set forth in Section 5.06; (iv) the rights of the Parent Related Parties and the Company Related Parties set forth in Section 7.03(d); and (v) following the valid termination of this Agreement pursuant to Article VII, subject to Section 7.02 and the last sentence of this Section 8.06, the right of the Company, as sole and exclusive agent for and on behalf of the stockholders of the Company (which stockholders shall not be entitled to pursue such damages on their own behalf) (who are third party beneficiaries hereunder solely to the extent necessary for this clause (v) to be enforceable), to pursue any damages (including damages based on loss of the economic benefit of the Transactions to the stockholders of the Company), which are intended for the benefit of, and shall be enforceable by, the Persons referred to in clauses (i) through (v) above.  Notwithstanding anything herein to the contrary, the rights granted pursuant to clause (v) of this Section 8.06 and the provisions of Section 7.02 with respect to the recovery of damages based on the losses suffered by the stockholders of the Company (including the loss of the economic benefit of the Transactions to the stockholders of the Company) shall only be enforceable on behalf of the stockholders of the Company by the Company in its sole and absolute discretion, as the sole and exclusive agent for the stockholders of the Company (which stockholders shall not be entitled to pursue such enforcement on their own behalf); provided that, in such capacity as sole and exclusive agent for the stockholders of the Company, the Company shall (i) be entitled to reimbursement (from the stockholders of the Company) from any such recovery of damages of its reasonable and documented out-of-pocket costs and expenses (including reasonable and documented out-of-pocket attorneys’ fees determined by reference to standard hourly rates) that have been incurred by the Company in connection with acting as sole and exclusive agent for the stockholders of the Company pursuant to clause (v) of this Section 8.06 and (ii) not be liable to the stockholders of the Company for any action taken, suffered or omitted to be taken by it in good faith except to the extent that the Company’s gross negligence or willful misconduct was the cause of any direct loss to the stockholders of the Company.

 

SECTION 8.07.  Governing Law; Jurisdiction.  (a) This Agreement shall be governed by, and construed in accordance with, the Laws of the State of Delaware applicable to contracts executed in and to be performed entirely within that State, regardless of the laws that might otherwise govern under any applicable conflict of Laws principles.

 

(b)  All Actions arising out of or relating to this Agreement or the Transactions shall be heard and determined in the Court of Chancery of the State of Delaware (or, if the Court of Chancery of the State of Delaware declines to accept jurisdiction over any Action, any state or federal court within the State of Delaware).  The parties hereto hereby irrevocably (i) submit to the exclusive jurisdiction and venue of such courts in any such Action, (ii) waive the defense of an inconvenient forum or lack of jurisdiction to the maintenance of any such Action, (iii) agree to not attempt to deny or defeat such jurisdiction by motion or otherwise request for leave from any such court and (iv) agree to not bring any Action arising out of or relating to this Agreement or the Transactions in any court other than the Court of Chancery of the State of Delaware (or, if the Court of Chancery of the State of Delaware declines to accept jurisdiction over any Action, any state or federal court within the State of Delaware), except for Actions brought to enforce the judgment of any such court.  The consents to jurisdiction and venue set forth in this Section 8.07(b) shall not constitute general consents to service of process in the State of Delaware and shall have no effect for any purpose except as provided in this paragraph and shall not be deemed to confer rights on any Person other than the parties hereto.  Each party hereto agrees that service of process upon such party in any Action arising out of or relating to this Agreement shall be effective if notice is given by overnight courier at the address set forth in Section 8.10.  The parties hereto agree that a final judgment in any such Action shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by applicable Law; provided, however, that nothing in the foregoing shall restrict any party’s rights to seek any post-judgment relief regarding, or any appeal from, a final trial court judgment.

 

SECTION 8.08.  Specific Enforcement.  The parties hereto agree that irreparable damage for which monetary relief (including any fees payable pursuant to Section 7.03), even if available, would not be an adequate remedy, would occur in the event that any provision of this Agreement is not performed in accordance with its specific terms or is otherwise breached, including if the parties hereto fail to take any action required of them hereunder to consummate this Agreement and the Transactions.  Subject to the following sentence, the parties hereto acknowledge and agree that (a) the parties shall be entitled to an injunction or injunctions, specific performance or other equitable relief to prevent breaches of this Agreement and to enforce specifically the terms and provisions hereof in the courts described in Section 8.07(b) without proof of damages or otherwise, this being in addition to any other remedy to which they are entitled under this Agreement, (b) the provisions set forth in Section 7.03 are not intended to and do not adequately compensate for the harm that would result from a breach of this Agreement and shall not be construed to diminish or otherwise impair in any respect any party’s right to specific enforcement and (c) the right of specific enforcement is an integral part of the Transactions and without that right neither the Company nor Parent would have entered into this Agreement.  The parties hereto agree not to assert that a remedy of specific enforcement is unenforceable, invalid, contrary to Law or inequitable for any reason, and not to assert that a remedy of monetary damages would provide an adequate remedy or that the parties otherwise have an adequate remedy at law.  The parties hereto acknowledge and agree that any party seeking an injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the terms and provisions of this Agreement in accordance with this Section 8.08 shall not be required to provide any bond or other security in connection with any such order or injunction.  If, prior to the Outside Date, any party hereto brings any action, in each case, in accordance with Section 8.08, to enforce specifically the performance of the terms and provisions hereof by any other party, the Outside Date shall automatically be extended (x) for the period during which such action is pending, plus 20 Business Days or (y) by such other time period established by the court presiding over such action, as the case may be.

 

SECTION 8.09.  WAIVER OF JURY TRIAL.  EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE IT HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT AND ANY OF THE AGREEMENTS DELIVERED IN CONNECTION HEREWITH OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.  EACH PARTY CERTIFIES AND ACKNOWLEDGES THAT (A) NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, (B) IT UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF SUCH WAIVER, (C) IT MAKES SUCH WAIVER VOLUNTARILY AND (D) IT HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVER AND CERTIFICATIONS IN THIS SECTION 8.09.

 

SECTION 8.10.  Notices.  All notices, requests and other communications to any party hereunder shall be in writing and shall be deemed given if delivered personally, emailed (unless an automated message indicating non-delivery is received with respect thereto) or sent by nationally recognized overnight courier (providing proof of delivery) to the parties at the following addresses:

 

If to Parent or Merger Sub, to it at:

 

with a copy (which shall not constitute notice) to:

 

If to the Company, to it at:

 

with copies (which shall not constitute notice) to:

 

or such other address or email address as such party may hereafter specify by like notice to the other parties hereto.  All such notices, requests and other communications shall be in writing and shall be deemed to have been received (i) when personally delivered, (ii) when transmitted via electronic e-mail address set out below (unless an automated message indicating non-delivery is received with respect thereto)if received prior to 5:00 p.m. local time in the place of receipt and such day is a Business Day in the place of receipt, or (iii) the next succeeding Business Day following the day on which the same has been delivered prepaid to a reputable national overnight air courier service.

 

SECTION 8.11.  Severability.  If any term, condition or other provision of this Agreement is determined by a court of competent jurisdiction to be invalid, illegal or incapable of being enforced by any rule of Law or public policy, all other terms, provisions and conditions of this Agreement shall nevertheless remain in full force and effect.  Upon such determination that any term, condition or other provision is invalid, illegal or incapable of being enforced, the parties hereto shall negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible to the fullest extent permitted by applicable Law.

 

SECTION 8.12.  Definitions.  (a) As used in this Agreement, the following terms have the meanings ascribed thereto below:

 

“Affiliate” means, as to any Person, any other Person that, directly or indirectly, controls, or is controlled by, or is under common control with, such Person.  For this purpose, “control” (including, with its correlative meanings, “controlled by” and “under common control with”) shall mean the possession, directly or indirectly, of the power to direct or cause the direction of management or policies of a Person, whether through the ownership of securities or partnership or other ownership interests, by contract or otherwise.

 

“Antitrust Laws” means the Sherman Act, the Clayton Act, the HSR Act, the Federal Trade Commission Act, all applicable foreign antitrust Laws and all other applicable Laws issued by a Governmental Authority that are designed or intended to prohibit, restrict or regulate actions having the purpose or effect of monopolization or restraint of trade or lessening of competition through merger or acquisition.

 

“Broadband Grant” means any award of funding or financing to the Company or any of its Subsidiaries (i) by any Governmental Authority or (ii) pursuant to any plan or program operated by any Governmental Authority, in the case of clauses (i) and (ii), to support the construction, installation, expansion and maintenance of any fiber network or similar infrastructure network and related facilities.

 

“Business Day” means a day except a Saturday, a Sunday or other day on which the banking institutions in the City of New York, New York are authorized or required by Law or executive order to be closed.

 

“California PUC Approval” means the State PUC Approval and Local Franchise Authority Approval applicable to the State PUC Licenses and Local Franchise Authority Licenses, respectively, issued to the Company or any of its Subsidiaries by the California Public Utilities Commission.

 

“Code” means the Internal Revenue Code of 1986.

 

“Collective Bargaining Agreement” means each collective bargaining, works council or other labor union Contract or labor arrangement covering any employee of the Company or any of its Subsidiaries, excluding any national, industry or similar generally applicable Contract or arrangement.

 

“Commonly Controlled Entity” means any Person or entity that, together with the Company or any of its Subsidiaries, is treated as a single employer under Section 414(b), (c), (m) or (o) of the Code.

 

“Communications Act” means the Communications Act of 1934, as amended (47 U.S.C. §151 et seq.), and any similar or successor federal statute, and the rules, regulations, decisions and published policies of the FCC promulgated thereunder, all as the same may be in effect from time to time.

 

“Communications Laws” means (a) the Communications Act and all codified rules and orders adopted by the FCC; (b) state statutes governing intrastate telecommunications services, cable services and/or facilities and the rules, regulations, and published policies, procedures, orders and decisions of the State PUCs and the Local Franchise Authorities; and (c) any other Laws, published policies, procedures, orders or decisions regulating or overseeing communications facilities, communications services or revenues, including Laws relating to the occupancy or use of any public rights-of-way, promulgated or issued by any Governmental Authority (including the FCC, any State PUC or any Local Franchise Authority) with jurisdiction over any of the services offered by the Company or any of its Subsidiaries.

 

“Company Charter Documents” means the Company’s certificate of incorporation and bylaws, each as amended and/or restated, as the case may be, and as in effect on the date hereof.

 

“Company Credit Agreement” means the Amended and Restated Credit Agreement, dated as of April 30, 2021, by and among Frontier Communications Holdings, LLC, as borrower, the banks and other financial institutions party thereto as lenders, JPMorgan Chase Bank, N.A., as administrative agent for the lenders, and Goldman Sachs Bank USA, as revolver agent, as amended, restated, amended and restated, supplemented or otherwise modified from time to time.

 

“Company IT Assets” means the IT Assets owned, leased, licensed or controlled by the Company or any of its Subsidiaries and used in the conduct of the businesses of the Company or any of its Subsidiaries.

 

“Company Lease” means any lease, sublease, license or other agreement (including any amendments, guaranties or other agreements related thereto) pursuant to which the Company or any of its Subsidiaries leases, subleases, licenses, occupies or holds a leasehold in any Leased Real Property.

 

“Company RSU/PSU Exchange Ratio” means a fraction, the numerator of which is the Merger Consideration and the denominator of which is the average of the volume weighted average price per share of Parent Common Stock on the New York Stock Exchange (as reported by Bloomberg L.P. or, if not reported therein, in another authoritative source mutually selected by Parent and the Company) on each of the five (5) consecutive trading days ending with the second complete trading day immediately prior to the Closing Date.

 

“Company Plan” means each plan, program, policy, agreement or other arrangement covering current or former directors, employees or individual consultants of the Company or any of its Subsidiaries, that is (a) an employee welfare plan within the meaning of Section 3(1) of ERISA (whether or not subject to ERISA), (b) an employee pension benefit plan within the meaning of Section 3(2) of ERISA, other than any plan which is a “multiemployer plan” (as defined in Section 4001(a)(3) of ERISA), (c) an equity or equity-based agreement, program or plan, (d) an individual employment, consulting, change-in-control, severance, retention or other similar agreement or (e) a bonus, incentive, deferred compensation, profit-sharing, retirement, supplemental retirement, post-retirement, vacation, paid time off, severance or termination pay, benefit or fringe benefit plan, program, policy, agreement or other arrangement, in each case, that is sponsored, maintained or contributed to by the Company or any of its Subsidiaries or which the Company or any of its Subsidiaries is obligated to sponsor, maintain or contribute to or under which the Company or any of its Subsidiaries has any liability, other than any Collective Bargaining Agreement or any plan, program, policy, agreement or arrangement mandated by applicable Law.

 

“Contract” means any loan or credit agreement, indenture, debenture, note, bond, mortgage, deed of trust, lease, sublease, license, contract or other agreement.

 

“Copyright” has the meaning set forth in the definition of Intellectual Property.

 

“Cybersecurity Incident” means unauthorized access to, use or encryption of the Company IT Assets (including a ransomware or denial-of-service attack), or the unauthorized access, disclosure, use or encryption or loss of Personal Information or other non-public and confidential information owned, controlled by, or in the possession of, the Company or its Subsidiaries.

 

 

“Domain Name” has the meaning set forth in the definition of Intellectual Property.

 

“Equity Plans” means collectively, the Company’s 2021 Management Incentive Plan and 2024 Management Incentive Plan, each as may be amended from time to time, and the Restricted Stock Unit Award Agreements and Performance Stock Unit Award Agreements entered into thereunder, substantially of the forms filed as exhibits to the Company’s Annual Report on Form 10-K for the year ended December 31, 2023.

 

“Equity-Based Awards” means, collectively, Company RSUs and Company PSUs.

 

“ERISA” means the Employee Retirement Income Security Act of 1974.

 

“FCC” means the Federal Communications Commission, any bureau or division thereof acting on delegated authority, or any successor agency.

 

“FCC Approval” means the consents, approvals, declaratory rulings, or other authorizations from the FCC, including any applicable review and clearance (including any letters of assurance, letters of agreement, or other settlement agreements that may be required in connection with such clearance) by Team Telecom, in each case as set forth in Section 8.12(a) of the Company Disclosure Letter.

 

“FCC Licenses” means the licenses, permits and other authorizations, together with any renewals, extensions or modifications thereof, issued by the FCC to the Company or any of its Subsidiaries, with respect to the business of the Company or any of its Subsidiaries.

 

“Final Order” means an action or decision as to which (a) no request for a stay is pending, no stay is in effect and any deadline for filing such request that may be designated by statute or regulation has passed, (b) no timely filed petition (or petition for which timely filing has been waived by the applicable Governmental Authority) for rehearing or reconsideration or application for review is pending and the time for the filing of any such petition or application has passed, (c) the relevant Governmental Authority does not have the action or decision under reconsideration on its own motion and the time within which it may effect such reconsideration has passed and (d) no appeal is pending or in effect and any deadline for filing any such appeal that may be designated by statute or rule has passed; provided that, notwithstanding any such request for a stay, petition for rehearing or reconsideration, application for review or appeal, an action or decision shall be deemed a Final Order unless such request for a stay, petition for rehearing or reconsideration, application for review or appeal is reasonably likely to result in the vacating or rescission of the original action or decision or in its modification in a manner that would cause the condition set forth in Section 6.02(d)(i) not to be satisfied.

 

“Fraud” means the actual, knowing and intentional fraud of any party in connection with the representations and warranties set forth in Article III or Article IV.

 

“GAAP” means generally accepted accounting principles in the U.S., consistently applied.

 

“Governmental Authority” means any government, bureau, board, department, political subdivision, court, regulatory or administrative agency, commission or authority or other legislative, executive or judicial governmental entity or tribunal (in each case including any self-regulatory organization), whether federal, state or local, domestic, foreign or multinational or any arbitrational tribunal.

 

“Government Official” means any official, officer, employee or Representative of, or any Person acting in an official capacity for or on behalf of, any Governmental Authority, and includes any official or employee of any entity directly or indirectly owned or controlled by any Governmental Authority, and any officer or employee of a public international organization, as well as any Person acting in an official capacity for or on behalf of any such Governmental Authority, or for or on behalf of any such public international organization.

 

“HSR Act” means the Hart-Scott-Rodino Antitrust Improvements Act of 1976.

 

“Intellectual Property” means all intellectual property rights in any jurisdiction throughout the world, including the following:  (a) patents and patent applications, including all reissues, divisionals, revisions, renewals, extensions, provisionals, re-examinations, continuations and continuations-in-part of any of the foregoing (collectively, “Patent”); (b) trademarks, service marks, trade names, brand names, corporate names, trade dress, tag-lines, slogans, logos, uniform resource locators, and other indicia of source or origin, together with all goodwill associated with the foregoing, and all applications to register, registrations and renewals of registration thereof (collectively, “Trademark”); (c) copyrights and corresponding rights in copyrightable subject matter and works of authorship, database and design rights and data collections (in each case, whether published or unpublished), mask works, and all registrations and applications to register any of the foregoing, applications to register and registrations any of the foregoing (collectively, “Copyright”); (d) internet domain names and uniform resource locators (collectively, “Domain Name”); (e) trade secrets, confidential information, and confidential and proprietary know-how, inventions and invention disclosures (whether or not patentable), ideas, methodologies, processes, techniques, technical and other data, research and development information and plans, business and marketing plans, customer and supplier lists, designs, specifications, formulae, and other confidential and proprietary information (collectively, “Trade Secrets”); and (f) rights of publicity.

 

“IRS” means the Internal Revenue Service.

 

“IT Assets” means information technology, computers, telecommunications equipment, and other information technology systems, including controlled networks, peripherals, hardware (whether general purpose or special purpose), firmware, middleware, servers, workstations, routers, hubs, data, Software, computer systems, databases and documentation, reference and resource materials relating thereto.

 

“Knowledge” means (i) with respect to the Company, the actual knowledge, as of the date of this Agreement, of the individuals listed on Section 8.12(b) of the Company Disclosure Letter and (ii) with respect to Parent or Merger Sub, the actual knowledge, as of the date of this Agreement, of any of the officers or directors of Parent or Merger Sub.

 

“Leased Real Property” means the real property that is leased, subleased, or licensed by the Company or any of its Subsidiaries from any third party (in each case whether as tenant, subtenant or licensee) that is (i) greater than 50,000 square feet and (ii) material to the business of the Company and its Subsidiaries, taken as a whole.

 

“Lien” means any pledge, lien, claim, charge, mortgage, deed of trust, encumbrance, judgment, option, right of first refusal or offer, license, defect in title, limitations in voting rights or security interest of any kind or nature.

 

“Local Franchise Authority” means a Governmental Authority responsible for granting franchises, as such term is defined in the Communications Laws, that has jurisdiction over the operations of the Company or any of its Subsidiaries.

 

“Local Franchise Authority Approvals” means, collectively, the consents, approvals, decisions, orders, waivers, rulings or other authorizations (including the lapse, without objection, of a prescribed time under a statute or regulation that states that a transaction may be implemented if a prescribed time lapses following the giving of notice without an objection being made) from Local Franchise Authorities having jurisdiction over the assets, business and operations of the Company and its Subsidiaries, including with respect to authorizing access to the public rights-of-way, in each case as set forth on Section 8.12(c) of the Company Disclosure Letter.

 

“Local Franchise Authority License” means each franchise, as such term is defined in the Communications Laws, granted by a Local Franchise Authority authorizing the construction, upgrade, maintenance and operation of any part of any cable system, as such term is defined in the Communications Laws, including with respect to authorizing access to the public rights-of-way.

 

 

“Material Adverse Effect” means any state of facts, condition, development, effect, change, event or occurrence that, individually or in the aggregate, has, or would be reasonably expected to have, a material adverse effect on the business, properties, results of operations or financial condition of the Company and its Subsidiaries taken as a whole; provided, however, that none of the following, and no state of facts, condition, development, effect, change, event or occurrence arising out of, or resulting from, the following, shall constitute or be taken into account in determining whether a Material Adverse Effect has occurred, is continuing or would reasonably be expected to occur:  any state of facts, conditions, effect, development, change, event or occurrence (A) generally affecting the industry in which the Company and its Subsidiaries operate or the economy, credit, financial or capital markets, in the U.S. or elsewhere in the world, including changes in interest or exchange rates, monetary policy or inflation, or (B) arising out of, resulting from or attributable to (1) changes in applicable Law or in GAAP or in accounting standards or changes in the general legal, regulatory, political or social conditions, in each case arising after the date hereof, (2) the negotiation, execution, announcement or performance of this Agreement or the consummation of the Transactions (other than for purposes of any representation or warranty contained in Sections 3.03(d) and 3.04), including the impact thereof on relationships, contractual or otherwise, with customers, suppliers, distributors, partners, employees or regulators, or any litigation arising from allegations of breach of fiduciary duty or violation of Law relating to this Agreement or the Transactions, (3) acts of war (whether or not declared), military activity, sabotage, civil disobedience or terrorism, or any escalation or worsening of any such acts of war (whether or not declared), military activity, sabotage, civil disobedience, or terrorism, (4) earthquakes, fires, floods, hurricanes, tornados or other natural disasters, weather-related events, casualty events, force majeure events or other comparable events, (5) any action taken by the Company or its Subsidiaries that is required by this Agreement or that is taken with Parent’s written consent or at Parent’s written request, or the failure to take any action by the Company or its Subsidiaries if that action is prohibited by this Agreement (provided that this clause (5) shall not apply to any action omitted to be taken pursuant to Section 5.01 unless the Company has requested to take an action that is prohibited by Section 5.01 and Parent has unreasonably withheld, delayed or conditioned its written consent to such action), (6) the identity of Parent or Merger Sub, (7) any decline in the market price, or change in trading volume, of the shares of the Company, (8) any change or prospective change in the Company’s credit ratings, (9) any failure to meet any internal or public projections, forecasts, guidance, estimates, milestones, budgets or internal or published financial or operating predictions of revenue, earnings, cash flow or cash position (it being understood that the exceptions in clauses (7), (8) and (9) shall not prevent or otherwise affect the inclusion of the underlying cause of any such change, decline or failure referred to therein (if not otherwise falling within any of the exceptions provided by clause (A) or (B)) in any determination as to whether there has been or would reasonably be expected to be a Material Adverse Effect) or (10) any epidemic, pandemic or other health disease outbreak; provided further, however, that any effect, change, event or occurrence referred to in clause (A) or clauses (B)(1), (3), (4) or (10) may be taken into account in determining whether there has been, or would reasonably be expected to be, a Material Adverse Effect to the extent such state of facts, condition, development, effect, change, event or occurrence has a disproportionate adverse effect on the Company and its Subsidiaries, taken as a whole, as compared to other participants in the industry in which the Company and its Subsidiaries operate (in which case only the incremental disproportionate impact or impacts may be taken into account in determining whether there has been, or would reasonably be expected to be, a Material Adverse Effect).

 

“Open Source Software” means any Software licensed, provided, distributed under, or otherwise subject to any open source license, including any license meeting the Open Source Definition (as promulgated by the Open Source Initiative) or the Free Software Definition (as promulgated by the Free Software Foundation).

 

“Owned Company Intellectual Property” means all Intellectual Property owned or purported to be owned by the Company or any of its Subsidiaries.

 

“Owned Real Property” means the real property (together with all structures, facilities, improvements and fixtures located thereon and all other interests and rights appurtenant thereto) owned in fee simple by the Company or any of its Subsidiaries that is (i) greater than 50,000 square feet and (ii) material to the business of the Company and its Subsidiaries, taken as a whole.

 

“Parent Common Stock” means the common stock, par value $0.10 per share, of Parent.

 

“Parent Material Adverse Effect” means any effect, change, event or occurrence that would prevent or materially delay, interfere with, hinder or impair (i) the consummation by Parent or Merger Sub of any of the Transactions on a timely basis or (ii) the compliance by Parent or Merger Sub with its obligations under this Agreement.

 

“Patent” has the meaning set forth in the definition of Intellectual Property.

 

“Permitted Liens” means (i) easements, rights-of-way, encroachments, restrictions, conditions, covenants, Liens and other similar matters of public record affecting title to applicable real property incurred or suffered in the ordinary course of business and in each case which, individually or in the aggregate, do not and would not reasonably be expected to materially impair the use, utility or value of the applicable real property or otherwise materially impair the present or reasonably contemplated business operations at such location, (ii) zoning, entitlement, building and other land use regulations imposed by Governmental Authorities and that are not violated in any material respect by the current use of the property to which they relate, (iii) Liens for Taxes not yet due and payable or the amount or validity of which are being contested in good faith and by appropriate proceedings and for which adequate accruals or reserves have been established in the consolidated balance sheets included in the Company SEC Documents, (iv) mechanics’, materialmen’s, carriers’, workmen’s, warehouseman’s, repairmen’s, landlords’ liens and similar Liens granted or which arise in the ordinary course of business and that are not yet due and payable or the amount or validity of which are being contested in good faith by appropriate proceedings, (v) Liens securing payment, or any obligation, with respect to outstanding Indebtedness set forth on Section 8.12(d)(i) of the Company Disclosure Letter so long as there is no event of default (whether cured or uncured) under such Indebtedness, (vi) pledges or deposits under workmen’s compensation Laws, social security Laws, unemployment insurance Laws or similar legislation, or good-faith deposits in connection with bids, tenders, Contracts (other than for the payment of Indebtedness) or leases to which such entity is a party, or deposits to secure public or statutory obligations of such entity or to secure surety or appeal bonds to which such entity is a party, or deposits as security for contested Taxes, in each case incurred or made in the ordinary course of business, (vii) non-exclusive licenses of Intellectual Property granted in the ordinary course of business, (viii) Liens set forth on Section 8.12(d)(ii) of the Company Disclosure Letter, (ix) terms, conditions and restrictions under leases, subleases, licenses or occupancy agreements, including statutory Liens of landlords, affecting any leased real property, none of which materially interferes with the present use of such leased real property, (x) Liens that have been placed by any developer, landlord or other third party on leased real property or property over which the Company or any of its Subsidiaries have easement rights and subordination or similar agreements relating thereto, (xi) any matters shown by a current, accurate survey or physical inspection of real property and (xii) such other Liens that, individually or in the aggregate, are not substantial in character or amount and do not materially detract from the value of, or materially impair the existing use of, the asset or property affected by such Lien.

 

“Person” means an individual, corporation, limited liability company, partnership, joint venture, association, trust, unincorporated organization or any other entity, including a Governmental Authority.

 

“Personal Information” means (a) any information that relates to, identifies or is reasonably capable of being associated with a natural person; and (b) information that constitutes “personal information”, “personally identifiable information”, “personal data” or other similar terms under applicable Law.

 

“Privacy Laws” means all applicable Laws, each as amended from time to time, that regulate data privacy, data security, data protection or cybersecurity, in each case with respect to the collection, storage, use, disclosure, destruction or other processing, and transfer of Personal Information.

 

“Registered Company Intellectual Property” means all Patents registrations and applications therefor, Trademarks registrations and applications therefor, Copyrights registrations and applications therefor and Domain Names registrations included in the Owned Company Intellectual Property.

 

“Representatives” means, with respect to any Person, its officers, directors, employees, consultants, agents, financial advisors, investment bankers, attorneys, accountants, other advisors, Affiliates and other representatives.

 

“Revolving Credit Facility” means the revolving credit facility established under the Company Credit Agreement.

 

“Software” means all computer programs, including software implementations of algorithms, models and methodologies, application software, system software and firmware, and databases, including all source code and object code versions thereof, in any and all forms and media, and all related documentation, manuals, descriptions, design and development tools and work product, user interfaces and models.

 

“State PUC” means a state public utility commission, state public service commission or other similar state or local regulatory authority with jurisdiction over the operations of the Company or any of its Subsidiaries, including a Governmental Authority authorizing the construction, upgrade, maintenance or operation of any part of the Cable Systems (as defined in the Communications Laws) that are part of or maintained or operated by the Company or its Subsidiaries, but excluding, in such capacity, any Local Franchise Authority.

 

“State PUC Approvals” means, collectively, the consents, approvals, decisions, orders, waivers, rulings or other authorizations (including the lapse, without objection, of a prescribed time under a statute or regulation that states that a transaction may be implemented if a prescribed time lapses following the giving of notice without an objection being made) from State PUCs having jurisdiction over the assets, business and operations of the Company and its Subsidiaries (for the avoidance of doubt, other than the Local Franchise Authority Approvals), in each case as set forth in Section 8.12(e) of the Company Disclosure Letter.

 

“State PUC License” means any permit, license, authorization, certification, directive, consent order or consent decree of or from any State PUC, in each case, in connection with the operation of the business of the Company or any of its Subsidiaries, all renewals and extensions thereof, and all applications filed with such State PUC for which the Company or any of its Subsidiaries is an applicant (for the avoidance of doubt, other than the Local Franchise Authority Licenses).

 

“Subsidiary”, when used with respect to any Person, means (i) any corporation, limited liability company, partnership, association, trust or other entity of which securities or other ownership interests representing more than 50% of the ordinary voting power (or, in the case of a partnership, more than 50% of the general partnership interests) are, as of such date, owned by such Person or one or more Subsidiaries of such Person or by such Person and one or more Subsidiaries of such Person or (ii) of which such Person or one of its Subsidiaries is a general partner or manager.

 

“Tax Returns” means any reports, returns, estimates, declarations of estimated tax, information returns, filings, claims for refund or other information relating to, filed or required to be filed with a Governmental Authority in connection with Taxes (including, for the avoidance of doubt, Form TD F 90-22.1), including any schedules or attachments thereto, and any amendments to any of the foregoing.

 

“Taxes” means all taxes, imposts, levies, withholding or other like assessments or charges imposed by a Governmental Authority, in each case in the nature of a tax, including any U.S. federal, state, local or non-U.S. income, corporation, capital gains, alternative minimum, excise, gross receipts, digital services, ad valorem, sales, goods and services, value added, harmonized sales, use, employment, withholding, estimated, franchise, profits, gains, real property, transfer, payroll, stamp, environmental, customs duties, social security contributions, unemployment, disability, e-911 taxes or other similar taxes or charges (whether disputed or not), together with all interest, penalties and additions imposed with respect to such amounts.

 

“Team Telecom” means the Committee for the Assessment of Foreign Participation in the United States Telecommunications Services Sector, or any successor thereto.

 

“Trade Secret” has the meaning set forth in the definition of Intellectual Property.

 

“Trademark” has the meaning set forth in the definition of Intellectual Property.

 

“Transactions” means, collectively, the transactions contemplated by this Agreement, including the Merger.

 

“USAC” means the Universal Service Administrative Company (USAC).

 

“U.S. Treasury Regulations” means the regulations prescribed under the Code.

 

“Willful Breach” means a material breach of this Agreement resulting from a willful act or a willful failure to act that would, or would reasonably be expected to, result in or constitute a material breach of this Agreement.

 

The following terms are defined on the page of this Agreement set forth after such term below:

 

SECTION 8.13.  Fees and Expenses.  Except as otherwise expressly provided herein, whether or not the Transactions are consummated, all fees and expenses incurred in connection with this Agreement and the Transactions shall be paid by the party incurring or required to incur such fees or expenses, except as otherwise expressly set forth in this Agreement.

 

SECTION 8.14.  Transfer Taxes.  Except as expressly provided in Section 2.02(b)(iv), Parent shall bear and timely pay (or cause to be timely paid) all transfer, documentary, sales, use, stamp, registration, value-added and other similar Taxes and fees incurred as a result of the Merger, and Parent shall prepare and timely file (or cause to be prepared and timely filed), at its expense, any Tax Returns and other documentation with respect to such Taxes and fees.

 

SECTION 8.15.  Performance Guaranty.  Parent hereby guarantees the due, prompt and faithful performance and discharge by, and compliance with, all of the obligations, covenants, terms, conditions and undertakings of Merger Sub under this Agreement in accordance with the terms hereof, including any such obligations, covenants, terms, conditions and undertakings that are required to be performed, discharged or complied with following the Effective Time by the Surviving Corporation.

 

SECTION 8.16.  Interpretation.  (a) When a reference is made in this Agreement to an Article, Section, Exhibit or Schedule, such reference shall be to an Article of, a Section of, or an Exhibit or Schedule to, this Agreement unless otherwise indicated.  The table of contents and headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement.  Whenever the words “include”, “includes” or “including” are used in this Agreement, they shall be deemed to be followed by the words “without limitation”.  The words “hereof”, “herein” and “hereunder” and words of similar import when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement.  The words “date hereof” when used in this Agreement shall refer to the date of this Agreement.  The terms “or”, “any” and “either” are not exclusive.  The word “extent” in the phrase “to the extent” shall mean the degree to which a subject or other thing extends, and such phrase shall not mean simply “if”.  The word “will” shall be construed to have the same meaning and effect as the word “shall”.  The words “made available to Parent” and words of similar import refer to documents (A) posted to the “Forward” electronic datasite hosted by Datasite on behalf of the Company by 11:59 p.m. (New York City time) on the day prior to the date hereof, (B) included in the Filed SEC Documents or (C) delivered in person or electronically to Parent or Merger Sub or their respective Representatives by 11:59 p.m. (New York City time) on the day prior to the date hereof.  All accounting terms used and not defined herein shall have the respective meanings given to them under GAAP.  All terms defined in this Agreement shall have the defined meanings when used in any document made or delivered pursuant hereto unless otherwise defined therein.  The definitions contained in this Agreement are applicable to the singular as well as the plural forms of such terms and to the masculine as well as to the feminine and neuter genders of such term.  Any agreement, instrument or statute defined or referred to herein or in any agreement or instrument that is referred to herein means such agreement, instrument or statute as from time to time amended, modified or supplemented, including (in the case of agreements or instruments) by waiver or consent and (in the case of statutes) by succession of comparable successor statutes and references to all attachments thereto and instruments incorporated therein.  References herein to any statute includes all rules and regulations promulgated thereunder.  Unless otherwise specifically indicated, all references to “dollars” or “$” shall refer to the lawful money of the U.S.  References to a Person are also to its permitted assigns and successors.

 

(b)  The parties hereto have participated jointly in the negotiation and drafting of this Agreement and, in the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as jointly drafted by the parties hereto and no presumption or burden of proof shall arise favoring or disfavoring any party hereto by virtue of the authorship of any provision of this Agreement.

 

SECTION 8.17.  Certain Financing Provisions.  Notwithstanding anything in this Agreement to the contrary, the Company hereby agrees: (a) that any suit, legal action or proceeding, whether in law or in equity, whether in contract, in tort or otherwise, directly involving any Person (other than Parent, Merger Sub or any Affiliate thereof) that is an agent, arranger, lender or underwriter of, or otherwise a third party counterparty of Parent or Merger Sub with respect to any actual or potential Financing or any Affiliate of any such Person (collectively, with each of their respective Representatives acting as such, the “Financing Parties”), in each case, arising out of or relating to this Agreement, any Financing or any of the agreements entered into in connection with the Financing or any transaction contemplated hereby or thereby or the performance of any services thereunder (any such suit, legal action or proceeding, a “Financing Party Action”) shall be subject to the exclusive jurisdiction of any federal or state court in the County of New York, New York and any appellate court thereof (and each party hereto irrevocably submits itself and its property with respect to any Financing Party Action to the exclusive jurisdiction of such court); (b) that any Financing Party Action shall be governed by the laws of the State of New York (without giving effect to any conflicts of law principles that would result in the application of the laws of another state), except as expressly otherwise provided in any applicable agreement relating to the Financing; (c) not to bring or support, or permit any of its controlled Affiliates to bring or support, any Financing Party Action against any Financing Party in any forum other than any federal or state court in the County of New York, New York; (d) that it irrevocably waives, to the fullest extent that it may effectively do so, the defense of an inconvenient forum to the maintenance of any Financing Party Action in any such court; (e) knowingly, intentionally and voluntarily waives to the fullest extent permitted by applicable law trial by jury in any Financing Party Action brought against the Financing Parties; (f) that none of the Financing Parties will have any liability to the Company or to its respective Affiliates relating to or arising out of this Agreement, the Financing, any agreement relating thereto or any of the transactions contemplated hereby or thereby or the performance of any services thereunder, whether in law or in equity, whether in contract or in tort or otherwise (it being understood that nothing in this clause (f) shall affect the obligations of Parent, Merger Sub and their Affiliates under this Agreement); and (g) that (and each other party hereto agrees that) the Financing Parties are express third party beneficiaries of, and may enforce, the provisions of this Section 8.17, and which provisions shall not be amended in a manner adverse to any Financing Party without its prior written consent. “Financing” means any debt financing obtained by Parent or Merger Sub (or any of its Affiliates on its behalf) for the purpose of financing the transactions contemplated hereby.

 

[Signature page follows]

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed and delivered as of the date first above written.

 

 

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