EXHIBIT 10.1
UNIT PURCHASE AGREEMENT
BY AND BETWEEN
VIASAT, INC.
AND
WILDBLUE COMMUNICATIONS, INC.
DECEMBER 12, 2001
TABLE OF CONTENTS
1. Definitions..............................................................1
2. Purchase and Sale of the Units and the Closing...........................3
(a) Purchase and Sale of the Units....................................3
(b) The Closing.......................................................3
(c) Deliveries at the Closing.........................................3
3. Representations and Warranties Concerning the Transaction................5
(a) Organization of the Seller........................................5
(b) Authorization of Transaction......................................5
(c) Noncontravention..................................................5
(d) Brokers' Fees.....................................................5
(e) Investment........................................................5
(f) The Units.........................................................6
(g) Tax Advice........................................................6
(h) Company Delivery..................................................6
4. Representations and Warranties of the Buyer..............................6
(a) Organization of the Buyer.........................................6
(b) Authorization of Transaction......................................6
(c) Noncontravention..................................................7
(d) Brokers' Fees.....................................................7
(e) Investment........................................................7
(f) Tax Advice........................................................7
5. Post-Closing Covenants...................................................7
(a) General...........................................................7
(b) Litigation Support................................................7
(c) Confidentiality...................................................8
(d) Intellectual Property.............................................8
(e) Escrow Agreement..................................................9
(f) Certain Taxes.....................................................9
6. Remedies for Breaches of this Agreement..................................9
(a) Indemnification by the Seller.....................................9
(b) Limitations on Indemnification by the Seller......................9
(c) Indemnification by the Buyer.....................................10
(d) Limitation on Indemnification by the Buyer.......................10
(e) Notice; Defense of Claims........................................11
(f) Non-Exclusive Remedy.............................................11
(g) Indemnification Payments.........................................12
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7. Miscellaneous...........................................................12
(a) Press Releases and Public Announcements..........................12
(b) No Third-Party Beneficiaries.....................................12
(c) Entire Agreement.................................................12
(d) Succession and Assignment........................................12
(e) Counterparts.....................................................12
(f) Headings.........................................................13
(g) Notices..........................................................13
(h) Governing Law....................................................14
(i) Amendments and Waivers...........................................14
(j) Severability.....................................................14
(k) Expenses.........................................................14
(l) Construction.....................................................14
(m) Incorporation of Exhibits, Annexes and Schedules.................14
(n) Specific Performance.............................................15
(o) Mediation/Arbitration............................................15
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UNIT PURCHASE AGREEMENT
This Unit Purchase Agreement (this "Agreement") is entered into as of
December 12, 2001 by and between ViaSat, Inc., a Delaware corporation (the
"Buyer"), and Wildblue Communications, Inc., a Delaware corporation (the
"Seller"). The Buyer and the Seller are referred to collectively herein as the
"Parties."
The Seller owns the Units (as defined below) representing all of its
equity interests in U.S. Monolithics, LLC, an Arizona limited liability company
(the "Company").
This Agreement contemplates a transaction in which (a) the Buyer will
purchase from the Seller, and the Seller will sell to the Buyer, the Units, (b)
the Buyer will become a substitute member of the Company, and (c) the Buyer and
the Seller will amend certain existing agreements by and between them, on the
terms set forth herein.
Now, therefore, in consideration of the premises and the mutual promises
herein made, and in consideration of the representations, warranties, and
covenants herein contained, the Parties agree as follows.
1. Definitions.
"Adverse Consequences" means all actions, suits, proceedings, hearings,
investigations, charges, complaints, claims, demands, injunctions, judgments,
orders, decrees, rulings, damages, dues, penalties, fines, costs, amounts paid
in settlement, Liabilities, obligations, Taxes, liens, losses, expenses, and
fees, including arbitration costs, court costs and reasonable attorneys' fees
and expenses.
"Affiliate" has the meaning set forth in Rule 12b-2 of the regulations
promulgated under the Securities Exchange Act of 1934, as amended.
"Agreement" has the meaning set forth in the preface above.
"Buyer" has the meaning set forth in the preface above.
"Buyer Indemnified Party" has the meaning set forth in Section 6(a)
below.
"Closing" has the meaning set forth in Section 2(b) below.
"Closing Date" has the meaning set forth in Section 2(b) below.
"Code" means the Internal Revenue Code of 1986, as amended.
"Company" has the meaning set forth in the preface above.
"Confidential Information" means any information concerning the
businesses and affairs of the Company that is not already generally available to
the public.
"D&L Agreement" has the meaning set forth in Section 3(h) below.
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"Escrow Agreement" means the Escrow Agreement in form and substance as
set forth in Exhibit A hereto.
"Liability" means any liability (whether known or unknown, whether
asserted or unasserted, whether absolute or contingent, whether accrued or
unaccrued, whether liquidated or unliquidated, and whether due or to become
due), including any liability for Taxes.
"New Development Agreement" means the Agreement for Satellite Modem and
Wildblue Satellite Terminal and Satellite Modem Termination System Development,
Production and Purchase by and between the Buyer and the Seller in form and
substance as set forth in Exhibit B hereto.
"Operating Agreement" means the Company's Amended and Restated Operating
Agreement (as amended to date).
"Party" has the meaning set forth in the preface above.
"Patent Application" has the meaning set forth in Section 5(d) below.
"Person" means an individual, a partnership, a corporation, an
association, a joint stock company, a trust, a joint venture, an unincorporated
organization, or a governmental entity (or any department, agency, or political
subdivision thereof).
"Pledge Agreement" means the Pledge and Security Agreement in form and
substance as set forth in Exhibit D hereto.
"Purchase Price" has the meaning set forth in Section 2(a) below.
"SEC" means the United States Securities and Exchange Commission.
"Secured Note" means the secured promissory note in the aggregate
principal amount of Six Million U.S. Dollars (US$6,000,000) in form and
substance as set forth in Exhibit C-1 hereto.
"Securities Act" means the Securities Act of 1933, as amended.
"Security Interest" means any mortgage, pledge, lien, encumbrance,
charge, or other security interest of any kind.
"Seller" has the meaning set forth in the preface above.
"Seller Indemnified Party" has the meaning set forth in Section 6(c)
below.
"Tax" means any federal, state, local, or foreign income, gross
receipts, license, payroll, employment, excise, severance, stamp, occupation,
premium, windfall profits, environmental (including taxes under Code Section
59A), customs duties, membership interests, franchise, profits, withholding,
social security (or similar), unemployment, disability, real property, personal
property, sales, use, transfer, registration, value added, alternative or add-on
minimum,
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estimated, or other tax or similar charge of any kind whatsoever, including any
interest, penalty, or addition thereto, whether disputed or not.
"Tax Return" means any return, declaration, report, claim for refund, or
information return or statement relating to Taxes, including any schedule or
attachment thereto, and including any amendment thereof.
"Units" means 16,153,846.15 Class B Units (as defined in the Operating
Agreement).
"Unsecured Note" means the unsecured promissory note in the aggregate
principal amount of Five Hundred Thousand U.S. Dollars (US$500,000) in form and
substance as set forth in Exhibit C-2 hereto.
2. Purchase and Sale of the Units and the Closing.
(a) Purchase and Sale of the Units. On and subject to the terms
of this Agreement, the Buyer shall purchase from the Seller, and the Seller
shall sell to the Buyer the Units, which Units represent all of the Seller's
equity interests in the Company, for consideration of Ten Million U.S. Dollars
(US$10,000,000) (the "Purchase Price") payable as follows: (i) the Secured Note,
(ii) the Unsecured Note, and (iii) a credit of Three Million Five Hundred
Thousand U.S. Dollars (US$3,500,000) against the Seller's payment obligations to
the Buyer under the New Development Agreement.
(b) The Closing. The closing of the transactions contemplated
by this Agreement (the "Closing") shall take place at the offices of Latham &
Watkins, 12636 High Bluff Drive, Suite 300, San Diego, CA 92130 commencing at
9:00 a.m. local time on December 12, 2001, or such other date as the Buyer and
the Seller may mutually determine (the "Closing Date").
(c) Deliveries at the Closing.
(i) At the Closing, the Seller will deliver to the
Buyer:
(A) this Agreement duly executed by the Seller;
(B) certificates representing the Units, duly
endorsed in blank or accompanied by duly executed
assignment documents provided, however, that
certificates representing 9,692,307.69 of the Units duly
endorsed in blank or accompanied by duly executed
assignment documents shall be delivered to the Escrow
Agent (as defined in the Escrow Agreement) by the
Seller, on behalf of the Buyer, and shall be governed by
the Escrow Agreement;
(C) an officer's certificate attaching
resolutions duly adopted by the Seller's board of
directors approving this Agreement and the transactions
contemplated hereby;
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(D) an opinion, addressed to the Buyer, and
dated as of the Closing Date, in form and substance
reasonably satisfactory to the Buyer;
(E) reasonable evidence that David M. Brown and
Thomas E. Moore have resigned as managers of the Company
as of the Closing;
(F) reasonable evidence that the Company has
waived all rights of first offer with respect to the
Units under Section 14.7 of the Operating Agreement;
(G) the New Development Agreement duly executed
by the Seller;
(H) the Pledge Agreement duly executed by the
Seller;
(I) the Escrow Agreement duly executed by the
Seller;
(J) the Patent Assignment in form and substance
as set forth in Exhibit E attached hereto duly executed
by the Seller; and
(K) all other certificates, opinions,
instruments, and other documents reasonably required of
the Seller to effect the transactions contemplated
hereby, in each case reasonably satisfactory in form and
substance to the Buyer.
(ii) At the Closing, the Buyer will deliver to the
Seller:
(A) this Agreement duly executed by the Buyer;
(B) the Secured Note and the Unsecured Note,
each duly executed by the Buyer;
(C) an officer's certificate attaching
resolutions duly adopted by the Buyer's board of
directors approving this Agreement and the transactions
contemplated hereby;
(D) an opinion, addressed to the Seller, and
dated as of the Closing Date, in form and substance
reasonably satisfactory to the Seller;
(E) reasonable evidence that the Buyer has
agreed in writing to be bound by the Operating Agreement
and to become a substitute member of the Company;
(F) the New Development Agreement duly executed
by the Buyer;
(G) the Pledge Agreement duly executed by the
Buyer;
(H) the Escrow Agreement duly executed by the
Buyer; and
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(I) all other certificates, opinions,
instruments, and other documents reasonably required of
the Buyer to effect the transactions contemplated
hereby, in each case reasonably satisfactory in form and
substance to the Seller.
3. Representations and Warranties Concerning the Transaction. The Seller
hereby represents and warrants to the Buyer that:
(a) Organization of the Seller. The Seller is duly organized,
validly existing, and in good standing under the laws of the State of Delaware
with all requisite corporate power and authority to carry on its business as
currently conducted and to own, lease, use and operate its assets.
(b) Authorization of Transaction. The Seller has full corporate
power and authority to execute and deliver this Agreement and to perform its
obligations hereunder. This Agreement constitutes the valid and legally binding
obligation of the Seller, enforceable in accordance with its terms and
conditions, except as enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws now or hereafter in
effect relating to or affecting creditors' rights generally and subject to the
limitations imposed by general equitable principles. The Seller need not give
any notice to, make any filing with, or obtain any authorization, consent, or
approval of any government, governmental agency or third party in order to
consummate the transactions contemplated by this Agreement, other than such
notices, filings, authorizations, consents and approvals the failure to obtain
or make would not have a material adverse effect on the Buyer or the Company.
(c) Noncontravention. Subject to the Company delivering the
waiver contemplated by Section 2(c)(i)(F), neither the execution and the
delivery of this Agreement nor the consummation of the transactions contemplated
hereby will (i) violate any constitution, statute, regulation, rule, injunction,
judgment, order, decree, ruling, charge, or other restriction of any government,
governmental agency, or court to which the Seller is subject or any provision of
its charter or bylaws or (ii) conflict with, result in a breach of, constitute a
default under, result in the acceleration of, create in any party the right to
accelerate, terminate, modify, or cancel, or require any notice under any
material agreement, contract, lease, license, instrument, or other arrangement
to which the Seller is a party or by which it is bound or to which any of its
assets is subject (or result in the imposition of any Security Interest upon any
of its assets).
(d) Brokers' Fees. The Seller has no Liability or obligation to
pay any fees or commissions to any broker, finder, or agent with respect to the
transactions contemplated by this Agreement for which the Buyer could become
liable or obligated.
(e) Investment. The Seller (i) understands that the Secured Note
and the Unsecured Note have not been, and will not be, registered under the
Securities Act, or under any state securities laws, and are being offered and
sold in reliance upon federal and state exemptions for transactions not
involving any public offering, (ii) is acquiring the Secured Note and the
Unsecured Note solely for its own account for investment purposes, and not with
a view to the distribution thereof, (iii) is a sophisticated investor with
knowledge and experience in business and financial matters, (iv) has received
certain information concerning the Buyer and has had the
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opportunity to obtain additional information as desired in order to evaluate the
merits and the risks inherent in holding the Secured Note and the Unsecured
Note, and (v) is an Accredited Investor.
(f) The Units. The Seller holds of record and owns beneficially
the Units, free and clear of any restrictions on transfer (other than any
restrictions under the Securities Act and state securities laws), Taxes,
Security Interests, options, warrants, purchase rights, contracts, commitments,
equities, claims, and demands. The Seller is not a party to any option, warrant,
purchase right, or other contract or commitment that could require the Seller to
sell, transfer, or otherwise dispose of any of the Units (other than this
Agreement). The Seller is not a party to any voting trust, proxy, or other
agreement or understanding with respect to the voting of any of the Units. Upon
the consummation of the transactions contemplated hereby, the Buyer will acquire
good and marketable title to the Units, free and clear of any restrictions on
transfer (other than any restrictions under the Securities Act and state
securities laws), Taxes, Security Interests, options, warrants, purchase rights,
contracts, commitments, equities, claims and demands.
(g) Tax Advice. The Seller has reviewed with its own tax
advisors the federal, state and local tax consequences of the transactions
contemplated by this Agreement. The Seller is relying solely on such advisors
and not on any statements or representations of the Company or the Buyer or any
of their respective agents.
(h) Company Delivery. The Company has delivered to the Seller
the First Article Prototype in accordance with Section 1.2 of the Development
and License Agreement dated March 24, 2000 between iSKY, Inc. (now known as the
Seller) and the Company (the "D&L Agreement") that meets all requirements and
specifications under the D&L Agreement. The Company is not in default under, or
in breach of, the D&L Agreement.
4. Representations and Warranties of the Buyer. The Buyer represents and
warrants to the Seller that:
(a) Organization of the Buyer. The Buyer is a corporation duly
organized, validly existing, and in good standing under the laws of the State of
Delaware with all requisite corporate power and authority to carry on its
business as currently conducted and to own, lease, use and operate its assets.
(b) Authorization of Transaction. The Buyer has full corporate
power and authority to execute and deliver this Agreement and to perform its
obligations hereunder. This Agreement constitutes the valid and legally binding
obligation of the Buyer, enforceable in accordance with its terms and
conditions, except as enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws now or hereafter in
effect relating to or affecting creditors' rights generally and subject to the
limitations imposed by general equitable principles. The Buyer need not give any
notice to, make any filing with, or obtain any authorization, consent, or
approval of any government or governmental agency in order to consummate the
transactions contemplated by this Agreement, other than such notices, filings,
authorizations, consents and approvals the failure to obtain or make would not
have a material adverse effect on the Seller.
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(c) Noncontravention. Neither the execution and the delivery of
this Agreement nor the consummation of the transactions contemplated hereby will
(i) violate any constitution, statute, regulation, rule, injunction, judgment,
order, decree, ruling, charge, or other restriction of any government,
governmental agency, or court to which the Buyer is subject or any provision of
its charter or bylaws or (ii) conflict with, result in a breach of, constitute a
default under, result in the acceleration of, create in any party the right to
accelerate, terminate, modify, or cancel, or require any notice under any
material agreement, contract, lease, license, instrument, or other arrangement
to which the Buyer is a party or by which it is bound or to which any of its
assets is subject.
(d) Brokers' Fees. The Buyer has no Liability or obligation to
pay any fees or commissions to any broker, finder, or agent with respect to the
transactions contemplated by this Agreement for which the Seller could become
liable or obligated.
(e) Investment. The Buyer (i) understands that the Units have
not been, and will not be registered under the Securities Act, or under any
state securities laws, and are being offered and sold in reliance upon federal
and state exemptions for transactions not involving any public offering, (ii) is
familiar with SEC Rule 144, as presently in effect, and understands the resale
limitations imposed thereby and by the Securities Act, including without
limitation, the fact that the Buyer may not be able to sell the Units pursuant
to Rule 144 unless current information about the Company is available to the
public, which information is not now available and there are no present plans to
make such information available, (iii) is not acquiring the Units with a view to
or for sale in connection with any distribution thereof within the meaning of
the Securities Act, (iv) is a sophisticated investor with knowledge and
experience in business and financial matters, (v) has received certain
information concerning the Company and has had the opportunity to obtain
additional information as desired in order to evaluate the merits and the risks
inherent in holding the Units, (vi) is able to bear the economic risk and lack
of liquidity inherent in holding the Units, and (vii) is an Accredited Investor.
(f) Tax Advice. The Buyer has reviewed with its own tax advisors
the federal, state and local tax consequences of the transactions contemplated
by this Agreement. The Buyer is relying solely on such advisors and not on any
statements or representations of the Company or any of its agents.
5. Post-Closing Covenants. The Parties agree as follows with respect to
the period following the Closing.
(a) General. In case at any time after the Closing any further
action is necessary or desirable to carry out the purposes of this Agreement,
each of the Parties will take such further action (including the execution and
delivery of such further instruments and documents) as the other Party may
reasonably request, all at the sole cost and expense of the requesting Party
(unless the requesting Party is entitled to indemnification therefor under
Section 6 below).
(b) Litigation Support. In the event and for so long as any
Party actively is contesting or defending against any action, suit, proceeding,
hearing, investigation, charge, complaint, claim, or demand in connection with
(i) any transaction contemplated under this
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Agreement or (ii) any fact, situation, circumstance, status, condition,
activity, practice, plan, occurrence, event, incident, action, failure to act,
or transaction on or prior to the Closing Date involving the Company, the other
Party will cooperate with the contesting or defending Party and its counsel in
the contest or defense, make available its personnel, and provide such testimony
and access to its books and records as shall be necessary in connection with the
contest or defense, all at the sole cost and expense of the contesting or
defending Party (unless the contesting or defending Party is entitled to
indemnification therefor under Section 6 below).
(c) Confidentiality. The Seller will treat and hold as such all
Confidential Information, refrain from using any Confidential Information except
in connection with this Agreement, and deliver promptly to the Buyer or destroy,
at the request and option of the Buyer, all tangible embodiments (and all
copies) of the Confidential Information that are in its possession (except as
permitted under existing agreements between the Seller and the Company). In the
event that the Seller is requested or required (by oral question or request for
information or documents in any legal proceeding, interrogatory, subpoena, civil
investigative demand, or similar process) to disclose any Confidential
Information, that Seller will notify the Buyer promptly of the request or
requirement so that the Buyer may seek an appropriate protective order or waive
compliance with the provisions of this Section 5(c). If, in the absence of a
protective order or the receipt of a waiver hereunder, the Seller is, on the
advice of counsel, compelled to disclose any Confidential Information to any
tribunal or else stand liable for contempt, the Seller may disclose the
Confidential Information to the tribunal; provided, however, that the Seller
shall use its reasonable efforts to obtain, at the request of the Buyer, an
order or other assurance that confidential treatment will be accorded to such
portion of the Confidential Information required to be disclosed as the Buyer
shall designate. The foregoing provisions shall not apply to any Confidential
Information that is generally available to the public immediately prior to the
time of disclosure.
(d) Intellectual Property. The Company filed U.S. Patent
Application No. 09/810,995 dated March 16, 2001 (the "Patent Application")
directed towards RF forward power detection method using DC current detection.
The Company will provide a copy of the Patent Application to the Seller, and, as
soon as reasonably practicable after the Closing Date but in no event later than
ten (10) business days after receiving a copy of the Patent Application from the
Company, the Seller shall provide access to the Patent Application to all of the
Seller's current employees (and shall make commercially reasonable efforts to
provide such access to the Seller's former employees), if any, who the Seller
reasonably believes might have contributed or presented a claim for inventorship
in the Patent Application. Within ten (10) business days of receipt of the
Patent Application from the Company, the Seller shall identify all such
employees that the Seller reasonably believes should be named as inventors on
the Patent Application, if any. If there are such employees of the Seller who
the Seller reasonably believes should be added as inventors on the Patent
Application, the Seller shall promptly notify the Company in writing. The Seller
shall assign, and shall ensure that all such inventors (if necessary) assign,
all their rights, title, and interest in the Patent Application to the Buyer or
the Company as designated in writing by the Buyer. If the Seller concludes that
none of its employees should be added as inventors on the Patent Application, it
shall so notify the Buyer promptly in writing. The Seller shall treat the Patent
Application as Confidential Information, shall provide the Buyer a list of all
employees who reviewed the Patent Application and shall return to the Company
any and all copies of the Patent Application. The Seller shall use commercially
reasonable efforts to
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ensure that none of its current or former employees or any other Person keeps
any copies of the Patent Application.
(e) Escrow Agreement. The Parties shall negotiate in good faith
and enter into an escrow agreement on or prior to January 31, 2002, in form and
substance reasonably acceptable to each Party to provide an escrow for any
payment obligations of the Seller to the Buyer that will become due after
January 31, 2002, upon the delivery to the Seller by the Buyer of certain items
in accordance with Section 17.1 of the New Development Agreement, it being
understood that the Buyer shall, on behalf of the Seller, deliver to the escrow
agent identified in the escrow agreement the amount of any such obligation up to
Five Hundred Thousand U.S. Dollars (US$500,000) and any such amount delivered to
the escrow agent by the Buyer shall be offset against any amounts due to the
Seller by the Buyer under the Unsecured Note.
(f) Certain Taxes. All transfer, documentary, sales, use, stamp,
registration and other such Taxes and fees (including any penalties and
interest) incurred in connection with this Agreement shall be paid by the Seller
when due, and the Seller will, at its own expense, file all necessary Tax
Returns and other documentation with respect to all such transfer, documentary,
sales, use, stamp, registration and other Taxes and fees, and, if required by
applicable law, the Buyer will, and will cause its Affiliates to, join in the
execution of any such Tax Returns and other documentation.
6. Remedies for Breaches of this Agreement.
(a) Indemnification by the Seller. The Seller shall indemnify
and hold the Buyer and its Affiliates, successors and assigns and Persons
serving as officers, directors, partners, managers, stockholders, members,
employees and agents thereof (individually a "Buyer Indemnified Party" and
collectively the "Buyer Indemnified Parties") harmless from and against any
Adverse Consequences that may be sustained or suffered by any of them arising
out of or based upon any of the following matters:
(i) fraud, intentional misrepresentation or the willful
breach of any representations, warranties or covenants of the
Seller under this Agreement or in any certificate, Schedule,
Annex or Exhibit delivered pursuant hereto; and
(ii) any breach of the representations and warranties
set forth in Section 3 or any covenant, agreement or obligation
of the Seller under this Agreement.
(b) Limitations on Indemnification by the Seller. Anything
contained in this Agreement to the contrary notwithstanding, the Liability of
the Seller to provide any indemnification to any Buyer Indemnified Party and the
right of the Buyer Indemnified Parties to indemnification under Section 6(a)
shall be subject to the following provisions:
(i) No claims for indemnification shall be made under
this Agreement against the Seller, and no indemnification shall
be payable to any Buyer Indemnified Party, with respect to
claims pursuant to Section 6(a)(ii) above, after the date that
is one year following the Closing (except for those claims that
were initiated prior to such one-year limitation).
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(ii) In no event shall the maximum aggregate Liability
of the Seller under Section 6(a)(ii) exceed the Purchase Price.
(iii) The Seller shall not be liable under Section
6(a)(ii) until the amount otherwise due to the Buyer Indemnified
Parties exceeds $100,000 in the aggregate, in which case the
Seller will be liable to the applicable Buyer Indemnified
Parties for the full amount due (including all amounts below
$100,000); provided, however, that this Section 6(b)(iii) shall
not apply to the Seller's payment obligations under Section
5(f).
(iv) Claims for indemnification with respect to matters
set forth in Section 6(a)(i) shall not be subject to any of the
limitations set forth in this Section 6(b).
(c) Indemnification by the Buyer. The Buyer shall indemnify and
hold the Seller and its Affiliates, successors and assigns and Persons serving
as officers, directors, partners, managers, stockholders, members, employees and
agents thereof (individually a "Seller Indemnified Party" and collectively the
"Seller Indemnified Parties") harmless from and against any Adverse Consequences
that may be sustained or suffered by any of them arising out of or based upon
any of the following matters:
(i) fraud, intentional misrepresentation or the willful
breach of any representations, warranties or covenants of the
Buyer under this Agreement or in any certificate, Schedule,
Annex or Exhibit delivered pursuant hereto;
(ii) any breach of the representations and warranties
set forth in Section 4 or any covenant, agreement or obligation
of the Buyer under this Agreement; and
(iii) any Liability arising from or in connection with
the ownership of the Units that arises after the Closing Date,
except to the extent such Adverse Consequences are attributable
to acts or circumstances occurring prior to the Closing Date.
(d) Limitation on Indemnification by the Buyer. Anything
contained in this Agreement to the contrary notwithstanding, the Liability of
the Buyer to provide any indemnification to any Seller Indemnified Party and the
right of the Seller Indemnified Parties to indemnification under Section 6(c)
shall be subject to the following provisions:
(i) No claims for indemnification shall be made under
this Agreement against the Buyer, and no indemnification shall
be payable to any Seller Indemnified Party, with respect to
claims asserted pursuant to Section 6(c)(ii) above, after the
date that is one year following the Closing (except for those
claims that were initiated prior to such one-year limitation).
(ii) In no event shall the maximum aggregate Liability
of the Buyer under Section 6(c)(ii) exceed the Purchase Price.
(iii) The Buyer shall not be liable under Section
6(c)(ii) until the amount otherwise due to the Seller
Indemnified Parties exceeds $100,000 in the
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aggregate, in which case the Buyer will be liable to the Seller
Indemnified Parties for the full amount due (including all
amounts below $100,000); provided, however, that this Section
6(d)(iii) shall not apply to the Buyer's obligations under
Section 6(c)(iii) above.
(iv) Claims for indemnification with respect to the
matters set forth in Section 6(c)(i) shall not be subject to any
of the limitations set forth in this Section 6(d).
(e) Notice; Defense of Claims. An indemnified party shall make
claims for indemnification hereunder by giving written notice thereof to the
indemnifying party promptly on discovery and in any event within the period in
which indemnification claims can be made hereunder. If indemnification is sought
for a claim or Liability asserted by a third party, the indemnified party shall
also give written notice thereof to the indemnifying party promptly after it
receives notice of the claim or Liability being asserted, but the failure to do
so shall not relieve the indemnifying party from any Liability except to the
extent that it is materially prejudiced by the failure or delay in giving such
notice. Such notice shall summarize the basis for the claim for indemnification
and any claim or Liability being asserted by a third party. Within twenty (20)
days after receiving such notice the indemnifying party shall give written
notice to the indemnified party stating whether it disputes the claim for
indemnification and whether it will defend against any third party claim or
Liability at its own cost and expense. If the indemnifying party fails to give
notice that it disputes an indemnification claim within twenty (20) days after
receipt of notice thereof, it shall be deemed to have accepted and agreed to the
claim, which shall become immediately due and payable. The indemnifying party
shall be entitled to direct the defense against a third-party claim or Liability
with counsel selected by it (subject to the consent of the indemnified party,
which consent shall not be unreasonably withheld or delayed) as long as the
indemnifying party is conducting a good faith and diligent defense. The
indemnified party shall at all times have the right to fully participate at its
own expense in the defense of a third-party claim or Liability, directly or
through counsel; provided, however, that if the named parties to the action or
proceeding include both the indemnifying party and the indemnified party and the
indemnified party is advised that representation of both parties by the same
counsel would be inappropriate under applicable standards of professional
conduct, the indemnified party may engage separate counsel at the expense of the
indemnifying party. If no such notice of intent to dispute and defend a
third-party claim or Liability is given by the indemnifying party, or if such
good faith and diligent defense is not being or ceases to be conducted by the
indemnifying party, the indemnified party shall have the right, at the expense
of the indemnifying party, to undertake the defense of such claim or Liability
(with counsel selected by the indemnified party), and to compromise or settle
it, with consent of the indemnifying party, which consent shall not be
unreasonably withheld or delayed. If the third party claim or Liability is one
that by its nature cannot be defended solely by the indemnifying party, then the
indemnified party shall make available such information and assistance as the
indemnifying party may reasonably request and shall cooperate with the
indemnifying party in such defense, at the expense of the indemnifying party.
(f) Non-Exclusive Remedy. The foregoing indemnification
provisions are in addition to, and not in derogation of, any statutory,
equitable, or common law remedy any Party may have for breach of representation,
warranty, or covenant. No Seller Indemnified Party shall make any claim for
indemnification against the Company by reason of the fact that he or it was a
11
manager, officer, employee, member or agent of the Company or was serving at the
request of the Company as a partner, manager, trustee, director, officer,
employee, or agent of another entity (whether such claim is for judgments,
damages, penalties, fines, costs, amounts paid in settlement, losses, expenses,
or otherwise and whether such claim is pursuant to any statute, charter
document, bylaw, operating agreement, contract or otherwise) with respect to any
action, suit, proceeding, complaint, claim, or demand brought by the Buyer
against the Seller (whether such action, suit, proceeding, complaint, claim, or
demand is pursuant to this Agreement, applicable law, or otherwise).
(g) Indemnification Payments. Any payments by a Party pursuant
to Section 6 shall be considered an adjustment to the Purchase Price for all
income and local tax purposes.
7. Miscellaneous.
(a) Press Releases and Public Announcements. No Party shall
issue any press release or make any public announcement relating to the subject
matter of this Agreement without the prior written approval of the Buyer and the
Seller; provided, however, that any Party may make any public disclosure it
believes in good faith is required by applicable law or any listing or trading
agreement concerning its publicly-traded securities (in which case the
disclosing Party will use its commercially reasonable efforts to advise the
other Party prior to making the disclosure).
(b) No Third-Party Beneficiaries. Except as specifically set
forth herein, this Agreement shall not confer any rights or remedies upon any
Person other than the Parties and their respective successors and permitted
assigns.
(c) Entire Agreement. This Agreement (including the Exhibits,
Annexes and Schedules identified herein) constitutes the entire agreement
between the Parties and supersedes any prior understandings, agreements, or
representations by the Parties, written or oral, to the extent they related in
any way to the subject matter hereof.
(d) Succession and Assignment. This Agreement shall be binding
upon and inure to the benefit of the Parties and their respective successors and
permitted assigns. No Party may assign either this Agreement or any of its
rights, interests, or obligations hereunder without the prior written approval
of the other party; provided, however, that the Buyer may (i) assign any or all
of its rights and interests hereunder to one or more of its Affiliates and (ii)
designate one or more of its Affiliates to perform its obligations hereunder (in
any or all of which cases the Buyer nonetheless shall remain responsible for the
performance of all of its obligations hereunder).
(e) Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original but all of which
together will constitute one and the same instrument. Each Party shall accept
the facsimile signature of the other Party hereto and shall be bound by its own
facsimile signature; provided, however, that the Parties shall exchange original
signatures by overnight mail.
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(f) Headings. The section headings contained in this Agreement
are inserted for convenience only and shall not affect in any way the meaning or
interpretation of this Agreement.
(g) Notices. All notices, requests, demands, claims, and other
communications hereunder shall be in writing. Any notice, request, demand,
claim, or other communication hereunder shall be deemed duly given three
business days after it is sent by registered or certified mail, return receipt
requested, postage prepaid, and addressed to the intended recipient as set forth
below:
If to the Seller:
Wildblue Communications, Inc.
4600 South Syracuse, Suite 500
Denver, CO 80237
Fax No.: 720-554-7500
Attn: David Brown, General Counsel
Copy to:
Brownstein Hyatt & Farber, P.C.
410 Seventeenth Street
22nd Floor
Denver, CO 80202
Fax No.: 303-223-0970
Attn: John L. Ruppert, Esq.
If to the Buyer:
ViaSat, Inc.
6155 El Camino Real
Carlsbad, CA 92009-1699
Fax No.: 760-929-3926
Attn: Keven K. Lippert, Esq.
Copy to:
Latham & Watkins
12636 High Bluff Drive, Suite 300
San Diego, CA 92130-2071
Fax No.: 858-523-5450
Attn: Craig M. Garner, Esq.
Any Party may send any notice, request, demand, claim, or other communication
hereunder to the intended recipient at the address set forth above using any
other means (including personal delivery, expedited courier, messenger service,
telecopy, telex, or ordinary mail). Each such notice, request, demand, claim, or
other communication shall be deemed to have been duly given
13
(i) if by fax, when such fax has been transmitted to the fax number set forth in
this Section 7(g) and evidence of receipt is received or (ii) if given by any
other means, upon delivery or refusal of delivery at the address set forth in
this Section 7(g). Any Party may change the address to which notices, requests,
demands, claims, and other communications hereunder are to be delivered by
giving the other Party notice in the manner herein set forth.
(h) Governing Law. This Agreement shall be governed by and
construed in accordance with the domestic laws of the State of California
without giving effect to any choice or conflict of law provision or rule
(whether of the State of California or any other jurisdiction) that would cause
the application of the laws of any jurisdiction other than the State of
California.
(i) Amendments and Waivers. No amendment or waiver of any
provision of this Agreement shall be valid unless the same shall be in writing
and signed by the Buyer and the Seller. No waiver by any Party of any default,
misrepresentation, or breach of warranty or covenant hereunder, whether
intentional or not, shall be deemed to extend to any prior or subsequent
default, misrepresentation, or breach of warranty or covenant hereunder or
affect in any way any rights arising by virtue of any prior or subsequent such
occurrence.
(j) Severability. Any term or provision of this Agreement that
is invalid or unenforceable in any situation in any jurisdiction shall not
affect the validity or enforceability of the remaining terms and provisions
hereof or the validity or enforceability of the offending term or provision in
any other situation or in any other jurisdiction.
(k) Expenses. Each Party will bear its own costs and expenses
(including legal fees and expenses) incurred in connection with this Agreement
and the transactions contemplated hereby. The Seller agrees that the Company has
not borne and shall not bear the Seller's costs and expenses (including any of
their brokers' fees, legal fees and expenses) in connection with this Agreement
or any of the transactions contemplated hereby.
(l) Construction. The Parties have participated jointly in the
negotiation and drafting of this Agreement. In the event an ambiguity or
question of intent or interpretation arises, this Agreement shall be construed
as if drafted jointly by the Parties and no presumption or burden of proof shall
arise favoring or disfavoring any Party by virtue of the authorship of any of
the provisions of this Agreement. Any reference to any federal, state, local, or
foreign statute or law shall be deemed also to refer to all rules and
regulations promulgated thereunder, unless the context requires otherwise. The
word "including" shall mean including without limitation. The Parties intend
that each representation, warranty, and covenant contained herein shall have
independent significance. If any Party has breached any representation,
warranty, or covenant contained herein in any respect, the fact that there
exists another representation, warranty, or covenant relating to the same
subject matter (regardless of the relative levels of specificity) that the Party
has not breached shall not detract from or mitigate the fact that the Party is
in breach of the first representation, warranty, or covenant.
(m) Incorporation of Exhibits, Annexes and Schedules. The
Exhibits, Annexes and Schedules identified in this Agreement are incorporated
herein by reference and made a part hereof.
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(n) Specific Performance. Each Party acknowledges and agrees
that the other Party would be damaged irreparably in the event any of the
provisions of this Agreement are not performed in accordance with their specific
terms or otherwise are breached. Accordingly, each Party shall be entitled to an
injunction or injunctions to prevent breaches of the provisions of this
Agreement and to enforce specifically this Agreement and the terms and
provisions hereof in any action instituted in any court of the United States or
any state thereof having jurisdiction over the Parties and the matter (subject
to the provisions set forth in Section 7(o) below), in addition to any other
remedy to which it may be entitled, at law or in equity.
(o) Mediation/Arbitration. If a dispute arises out of or relates
to this Agreement, or the breach thereof, the Buyer and the Seller shall
negotiate in good faith to settle such dispute, controversy or claim within
fifteen (15) calendar days of notice thereof. If the Buyer and the Seller are
unable to resolve such dispute, controversy or claim arising out of this
Agreement or the performance, breach or termination thereof within fifteen (15)
calendar days, it shall be settled by arbitration in accordance with the
Commercial Arbitration Rules of the American Arbitration Association. The place
of arbitration shall be Denver, Colorado. The arbitration shall be conducted by
a neutral arbitrator selected by mutual agreement of the Buyer and the Seller
within ten days after notice by either party to the other requesting such
arbitration. If the Buyer and the Seller fail to agree within ten days on the
selection of the arbitrator, an arbitrator shall be promptly appointed by the
American Arbitration Association. Prior to issuing a final arbitration award,
the arbitrator shall provide the Buyer and the Seller with a preliminary ruling
and allow the Buyer and the Seller a reasonable period (not to exceed five (5)
business days) to respond in writing to the preliminary ruling. Judgment upon
the arbitration award rendered may be entered in any court having jurisdiction.
The prevailing party shall be entitled to all costs of arbitration including,
but not limited to, reasonable attorneys' fees and out-of-pocket expenses. The
Parties shall be entitled to discovery in the same manner as though the dispute
was within the jurisdiction of the County Court, Denver, Colorado. Except as
otherwise required by law (or by the fiduciary duties of the Buyer's directors),
all information resulting from or otherwise pertaining to any dispute shall be
nonpublic and handled by the Buyer, the Seller and their respective agents in
such a way as to prevent the public disclosure of such information.
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IN WITNESS WHEREOF, the Parties hereto have executed this Agreement on
as of the date first above written.
BUYER SELLER
VIASAT, INC., a Delaware corporation WILDBLUE COMMUNICATIONS, INC.,
a Delaware corporation
By: /s/ Gregory D. Monahan By: /s/ David M. Brown
------------------------------------ ---------------------------------
Name: Gregory D. Monahan Name: David M. Brown
Title: VP General Counsel and Secretary Title: Vice President
[SIGNATURE PAGE TO UNIT PURCHASE AGREEMENT]