Exhibit 10.7
AGREEMENT
---------
This Agreement (the "Agreement") is made and entered into effective as of
September 28, 1999, by and between Pinnacle Towers III Inc., a Florida
corporation (the "Company") and Pinnacle Towers Inc., a Delaware corporation
("PT").
Background
PT owns 49 shares of Series A Convertible Preferred Stock of the Company
("Series A Preferred"). The parties hereto desire to: (a) effect the redemption
of 39.2 shares of Series A Preferred (the "Preferred Shares") from PT in
exchange for $39,200,000, payable in the form of a Convertible Promissory Note
in the form attached hereto as Exhibit A (the "Promissory Note"); (b) modify the
terms of the Series A Preferred; and (c) terminate that certain Servicing
Agreement between the parties and enter into a Cost and Expense Sharing and
Reimbursement Agreement, subject to the terms of this Agreement. Accordingly, in
consideration of the mutual covenants and agreements contained in this
Agreement, and in reliance on the representations and warranties specified
below, the parties agree as follows:
Terms
1. Redemption of Preferred Shares. In exchange for the consideration set
forth in Section 2 below, PT hereby transfers the Preferred Shares to the
Company, and the Company hereby redeems the Preferred Shares from PT. At the
time of execution of this Agreement, PT shall transfer or cause to be
transferred the certificate evidencing the Preferred Shares, duly endorsed for
transfer or accompanied by an appropriate stock power endorsed in blank, to the
Company. The Company shall reissue or cause the reissuance of a certificate
representing the remaining 9.8 shares of Series A Preferred held by PT.
2. Purchase Price and Method of Payment. The purchase price to be paid to
PT in exchange for the Preferred Shares shall be $39,200,000, payable at the
time of execution of this Agreement by the delivery of the Promissory Note.
3. Representations and Warranties of PT. PT represents and warrants to
the Company that the following statements contained in this Section 3 are
correct and complete as of the date of this Agreement:
(a) Organization. PT is duly organized, validly existing, and in good
------------
standing under the laws of Delaware.
(b) Authorization of Transaction. PT has full power and authority to
----------------------------
execute and deliver this Agreement and to perform its obligations
hereunder.
The Board of Directors of PT and Pinnacle Holdings, Inc., a Delaware
corporation and sole stockholder of PT, have duly authorized the execution,
delivery and performance of this Agreement, with Xxxxxx Xxx and Xxxxxx
Xxxxxx abstaining. This Agreement constitutes the valid and legally binding
obligation of PT, enforceable in accordance with its terms and conditions.
PT 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.
(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 PT is subject or any
provision of its certificate of incorporation 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 agreement, contract, lease, license,
instrument, or other arrangement to which PT is a party or by which it is
bound or to which any of its assets is subject.
(d) Preferred Shares. PT holds of record or owns beneficially the
----------------
Preferred Shares, free and clear of any interests or rights of third
parties and of any restrictions on transfer (other than restrictions under
the Securities Act of 1933, as amended and state securities laws), taxes,
mortgages, pledges, liens (other than a lien in favor of PT's lender, Bank
of America, N.A.), encumbrances, charges or other security interests,
options, warrants, purchase rights, contracts, commitments, equities,
claims, and demands. PT is not a party to any agreement, option, warrant,
purchase right, or other contract or commitment that could require PT to
sell, transfer, or otherwise dispose of the Preferred Shares. PT is not a
party to any voting trust, proxy, or other agreement or understanding with
respect to the voting of the Preferred Shares. Upon the delivery of the
Preferred Shares as contemplated by this Agreement, the Company will
receive valid marketable title to the Preferred Shares free and clear of
any pledge, lien, security interest, encumbrance, claim or equitable
interest.
4. Representations and Warranties of the Company. The Company
represents and warrants to PT that the following statements contained in this
Section 4 are correct and complete as of the date of this Agreement:
(a) Organization. The Company is duly organized, validly existing,
------------
and with active status under the laws of Florida.
2
(b) Authorization of Transaction. The Company has full 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 Company, enforceable in accordance with its terms
and conditions. The Company 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.
(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 Company is subject
or any provision of its certificate of incorporation 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 agreement, contract,
lease, license, instrument, or other arrangement to which the Company is a
party or by which it is bound or to which any of its assets is subject.
5. Consent to Amended and Restated Articles. PT hereby consents to
the modification of the terms of the Series A Preferred as set forth in the
Amended and Restated Articles of Incorporation in the form attached hereto as
Exhibit B (the "Amended and Restated Articles"), which consent is required by
Section 5(k) of the Amended and Restated Articles of the Company and deemed
satisfied by PT's execution of this Agreement. The parties agree that the
shares of Series A Preferred held by PT from the date of original issuance shall
have the preferences, qualifications, rights and privileges set forth in the
Amended and Restated Articles.
6. Cost and Expense Sharing and Reimbursement Agreement. The parties
entered into that certain Servicing Agreement, effective as of August 31, 1999,
pertaining to certain services to be performed by PT on behalf of the Company.
The parties hereby agree to terminate the Servicing Agreement, effective as of
August 31, 1999, and enter into a Cost and Expense Sharing and Reimbursement
Agreement in the form attached hereto as Exhibit C (the "Expense Sharing
Agreement"), which Expense Sharing Agreement shall govern the parties' rights
and obligations effective as of August 31, 1999.
3
7. Miscellaneous.
(a) No Third-Party Beneficiaries. This Agreement shall not confer any
----------------------------
rights or remedies upon any person other than the parties and their
respective successors and permitted assigns.
(b) Entire Agreement. This Agreement (including the documents
----------------
referred to herein) constitutes the entire agreement among the parties and
supersedes any prior understandings, agreements, or representations by or
among the parties, written or oral, to the extent they have related in any
way to the subject matter hereof.
(c) Succession and Assignment. This Agreement shall binding upon and
-------------------------
inure to the benefit of the parties named herein 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 parties.
(d) 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.
(e) 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.
(f) Notices. All notices, requests, demands, claims, and other
-------
communications hereunder will be in writing. Any notice, request, demand,
claim, or other communication hereunder shall be deemed duly given if
delivered personally, by overnight courier service (with proof of service),
by telecopy (if confirmed), or (and then two 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 the
recipient's signature to this Agreement or as follows:
If to the Company:
Pinnacle Towers III Inc.
0000 Xxxxxxxx Xxxxxxxxx, 0/xx/ Xxxxx
Xxxxxxxx, Xxxxxxx 00000
Attn: Xxxxxx X. Day
4
If to PT:
Pinnacle Towers Inc.
0000 Xxxxxxxx Xxxxxxxxx, 0/xx/ Xxxxx
Xxxxxxxx, Xxxxxxx 00000
Attn: Xxx Xxxxxxx
(g) Governing Law. This Agreement shall be governed by and construed
-------------
in accordance with the domestic laws of the State of Florida without giving
effect to any choice or conflict of law provision or rule (whether of the
State of Florida or any other jurisdiction) that would cause the
application of the laws of any jurisdiction other than the State of
Florida.
(h) Amendments and Waivers. No amendment of any provision of this
----------------------
Agreement shall be valid unless the same shall be in writing and signed by
all of the parties hereto. 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.
(i) 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.
(j) Construction. 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
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.
5
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first written above.
PINNACLE TOWERS INC.
By: _________________________________
Its: _________________________________
PINNACLE TOWERS III INC.
By: _________________________________
Xxxxxx X. Day, Vice President, Chief
Financial Officer and Secretary
6
Exhibit A
NEITHER THIS CONVERTIBLE PROMISSORY NOTE NOR THE VOTING COMMON STOCK INTO WHICH
IT IS CONVERTIBLE HAS BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR ANY APPLICABLE STATE SECURITIES LAWS. THEY MAY NOT BE SOLD, OFFERED
FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF A REGISTRATION STATEMENT IN
EFFECT WITH RESPECT TO THE SECURITIES UNDER SUCH ACT AND APPLICABLE LAWS OR SOME
OTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF SUCH ACT AND APPLICABLE
LAWS OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION
IS NOT REQUIRED.
PINNACLE TOWERS III INC.
CONVERTIBLE PROMISSORY NOTE
$39,200,000 ____________, __________
October __, 1999
PINNACLE TOWERS III INC., a Florida corporation (the "Company"), the
principal office of which is located at 0000 Xxxxxxxx Xxxxxxxxx, Xxxxx Xxxxx,
Xxxxxxxx, Xxxxxxx 00000, for value received hereby promises to pay to Pinnacle
Towers Inc., or its registered assigns, the sum of Thirty Nine Million Two
Hundred Thousand Dollars ($39,200,000), or such lesser amount as shall then
equal the outstanding principal amount hereof and any unpaid accrued interest
hereon, as set forth below. The outstanding principal under this Note shall be
due and payable in full within 30 days of the date demand is made therefor by
the Holder. Demand under this Note shall be given by the Holder to the Company
by written notice thereof in accordance with Section 11 below. Payment for all
amounts due hereunder shall be made at the Company's option by either wire
transfer or by mail to the registered address of the Holder.
The following is a statement of the rights of the Holder of this Note and
the conditions to which this Note is subject, and to which the Holder hereof, by
the acceptance of this Note, agrees:
1. Definitions. As used in this Note, the following terms, unless the
context otherwise requires, have the following meanings:
(a) "Company" includes any corporation which shall succeed to or
assume the obligations of the Company under this Note.
(b) "Holder," when the context refers to a holder of this Note, shall
mean any Person who shall at the time be the registered holder of this Note.
(c) "Person" means any individual, Company, partnership, joint
venture, trust, unincorporated organization or government or any agency or
political subdivision thereof.
2. Interest. Commencing on ___________________, and on each
________________ and _________________ thereafter until all outstanding
principal and interest on this Note shall have been paid in full, the Company
shall pay interest at the rate of eighteen percent (18%) per annum (the "Initial
Interest Rate") on the principal of this Note outstanding during the period
beginning on the date of issuance of this Note and ending on the date that the
principal amount of this Note becomes due and payable. In the event that the
principal amount of this Note is not paid in full when such amount becomes due
and payable, interest at the same rate as the Initial Interest Rate plus _____
percent (___%) shall continue to accrue on the balance of any unpaid principal
until such balance is paid.
3. Conversion.
3.1 Conversion. Any Holder of this Note has the right, at the
Holder's option (the "Option"), at any time prior to payment in full of the
principal balance of this Note, to convert this Note, in accordance with the
provisions of Section 3.2 hereof, in whole or in part, into fully paid and
nonassessable shares of the Company's Voting Common Stock, par value $0.001 per
share or Nonvoting Common Stock, par value $0.001 per share (the "Common
Stock"), at the option of the Holder from time to time. The number of shares of
Common Stock into which this Note may be converted ("Conversion Shares") shall
be determined by dividing the aggregate principal amount of this Note together
with all accrued interest to the date of conversion elected to be converted by
the Holder by the Conversion Price (as defined below) in effect at the time of
such conversion. The initial Conversion Price shall be equal to $25 (the
"Conversion Price").
3.2 Notice of Conversion Pursuant to Section 3.1. Before the Holder
shall be entitled to convert this Note into shares of Common Stock, it shall
surrender this Note at the office of the Company and shall give written notice
to the Company at its principal corporate office of the election to convert all
or a portion of the same pursuant to this Section 3 ("Notice of Conversion"),
and shall state therein the amount of the Note to be converted and the name or
names in which the certificate or certificates for shares of Common Stock are to
be issued. Such conversion shall be deemed to have been made immediately prior
to the close of business on the date of such surrender of the Note, and the
Person or Persons entitled to receive the shares of Common Stock issuable upon
such conversion shall
2
be treated for all purposes as the record holder or holders of such shares of
Common Stock as of such date.
3.3 Mechanics and Effect of Conversion. No fractional shares of
Common Stock shall be issued upon conversion of this Note. In lieu of the
Company issuing any fractional shares to the Holder upon the conversion of this
Note, the Company shall pay to the Holder the amount of outstanding principal
that is not so converted, such payment to be in the form as provided below. Upon
the conversion of this Note pursuant to Section 3.1 above, the Holder shall
surrender this Note, duly endorsed, at the principal office of the Company. At
its expense, the Company shall, as soon as practicable thereafter, issue and
deliver to such Holder at such principal office a certificate or certificates
for the number of shares of such Common Stock to which the Holder shall be
entitled upon such conversion (bearing such legends as are required by
applicable state and federal securities laws in the opinion of counsel to the
Company), together with any other securities and property to which the Holder is
entitled upon such conversion under the terms of this Note, including a check
payable to the Holder for any cash amounts payable as described above and a
replacement Note representing any amount of the Note not converted. Upon the
complete conversion of all of this Note, the Company shall be forever released
from all its obligations and liabilities under this Note, except that the
Company shall be obligated to pay the Holder, within ten (10) days after the
date of such conversion, any interest accrued and unpaid or unconverted to and
including the date of such conversion, and no more.
4. Prepayment. Prepayment of the principal of this Note is permitted, in
whole or in part, without premium or penalty of any kind; provided the Company
provides the Holder with thirty (30) days' prior written notice (unless notice
is waived in writing by the Holder) of its intention to prepay the principal of
this Note, in whole or in part, during which time the Holder may exercise the
Option by delivering to the Company the Notice of Conversion.
5. Conversion Price Adjustments.
5.1 Adjustments for Stock Splits and Subdivisions. In the event the
Company should at any time or from time to time after the date of issuance
hereof fix a record date for the effectuation of a split or subdivision of the
outstanding shares of Common Stock or the determination of holders of Common
Stock entitled to receive a dividend or other distribution payable in additional
shares of Common Stock or other securities or rights convertible into, or
entitling the holder thereof to receive directly or indirectly, additional
shares of Common Stock (hereinafter referred to as "Common Stock Equivalents")
without payment of any consideration by such holder for the additional shares of
Common Stock or the Common Stock Equivalents (including the additional shares of
Common Stock issuable upon
3
conversion or exercise thereof), then, as of such record date (or the date of
such dividend distribution, split or subdivision if no record date is fixed),
the Conversion Price of this Note shall be appropriately decreased so that the
number of shares of Common Stock issuable upon conversion of this Note shall be
increased in proportion to such increase of outstanding shares.
5.2 Adjustments for Reverse Stock Splits. If the number of shares of
Common Stock outstanding at any time after the date hereof is decreased by a
combination of the outstanding shares of Common Stock, then, following the
record date of such combination, the Conversion Price for this Note shall be
appropriately increased so that the number of shares of Common Stock issuable on
conversion hereof shall be decreased in proportion to such decrease in
outstanding shares.
5.3 Notices of Record Date, etc. In the event of:
(a) Any taking by the Company of a record of the holders of any
class of securities of the Company for the purpose of determining the holders
thereof who are entitled to receive any dividend (other than a cash dividend
payable out of earned surplus at the same rate as that of the last such cash
dividend theretofore paid) or other distribution, or any right to subscribe for,
purchase or otherwise acquire any shares of stock of any class or any other
securities or property, or to receive any other right; or
(b) Any capital reorganization of the Company, any
reclassification or recapitalization of the capital stock of the Company or any
transfer of all or substantially all of the assets of the Company to any other
Person or any consolidation or merger involving the Company; or
(c) Any voluntary or involuntary dissolution, liquidation or
windingup of the Company, the Company will mail to the holder of this Note at
least seven (7) days prior to the earliest date specified therein, a notice
specifying:
(i) The date on which any such record is to be taken for
the purpose of such dividend, distribution or right, and the amount and
character of such dividend, distribution or right; and
(ii) The date on which any such reorganization,
reclassification, transfer, consolidation, merger, dissolution, liquidation or
windingup is expected to become effective and the record date for determining
shareholders entitled to vote thereon.
5.4 Reservation of Stock Issuable Upon Conversion. The Company shall
at all times reserve and keep available out of its authorized but unissued
4
shares of Common Stock solely for the purpose of effecting the conversion of
this Note such number of its shares of Common Stock as shall from time to time
be sufficient to effect the conversion of the Note; and if at any time the
number of authorized but unissued shares of Common Stock shall not be sufficient
to effect the conversion of the entire outstanding principal amount of this
Note, in addition to such other remedies as shall be available to the holder of
this Note, the Company will use its best efforts to take such corporation action
as may, in the opinion of its counsel, be necessary to increase its authorized
but unissued shares of Common Stock to such number of shares as shall be
sufficient for such purposes.
6. Representations and Warranties of the Holder.
(a) The Holder by its acceptance of this Note acknowledges that it is
aware that this Note and the shares of Common Stock issuable to it by the
Company upon conversion of this Note have not been registered under the
Securities Act of 1933, as amended ("Act"), or the securities laws of any state
or other jurisdiction.
(b) The Holder warrants and represents to the Company that it has
acquired this Note, and, upon conversion of the Note, it will be acquiring the
Common Stock, for investment and not with a view to or for sale in connection
with any distribution of this Note or such Common Stock or with any intention of
distributing or selling this Note or such Common Stock.
(c) The Holder has no right to demand that the Company register this
Note or the shares of Common Stock issued or issuable under this Note.
7. Assignment. Subject to the restrictions on transfer described in
Section 11 below, the rights and obligations of the Company and the Holder of
this Note shall be binding upon and benefit the successors, assigns, heirs,
administrators and transferees of the parties.
8. Waiver and Amendment. Any provision of this Note may be amended,
waived or modified upon the written consent of the Company and the Holder.
9. Transfer of This Note or Securities Issuable on Conversion Hereof.
With respect to any offer, sale or other disposition of this Note or securities
into which such Note may be converted, the Holder will give written notice to
the Company prior thereto, describing briefly the manner thereof, together with
a written opinion of such Holder's counsel, to the effect that such offer, sale
or other distribution may be effected without registration or qualification
(under any federal or state law then in effect). Promptly upon receiving such
written notice and reasonably satisfactory opinion, if so requested, the
Company, as promptly as practicable, shall notify such Holder that such Holder
may sell or otherwise dispose
5
of this Note or such securities, all in accordance with the terms of the notice
delivered to the Company. If a determination has been made pursuant to this
Section 9 that the opinion of counsel for the Holder is not reasonably
satisfactory to the Company, the Company shall so notify the Holder promptly
after such determination has been made. Each Note thus transferred and each
certificate representing the securities thus transferred shall bear a legend as
to the applicable restrictions on transferability in order to ensure compliance
with the Act, unless in the opinion of counsel for the Company such legend is
not required. The Company may issue stop transfer instructions to its transfer
agent in connection with such restrictions.
10. Treatment of Note. To the extent permitted by generally accepted
accounting principles, the Company will treat, account and report the Note as
debt and not equity for accounting purposes and with respect to any returns
filed with federal, state or local tax authorities.
11. Notices. Any notice, request or other communication required or
permitted hereunder shall be in writing and shall be deemed to have been duly
given if personally delivered or if (and then two business days after) mailed by
registered or certified mail, postage prepaid, at the respective addresses of
the parties as set forth herein. Any party hereto may by notice so given change
its address for future notice hereunder.
12. No Shareholder Rights. Nothing contained in this Note shall be
construed as conferring upon the Holder or any other Person the right to vote or
to consent or to receive notice as a shareholder in respect of meetings of
shareholders for the election of directors of the Company or any other matters
or any rights whatsoever as a shareholder of the Company; and no dividends or
interest shall be payable or accrued in respect of this Note or the interest
represented hereby or the Conversion Shares obtained hereunder until, and only
to the extent that, this Note shall have been converted.
13. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Florida, excluding that body of law
relating to conflict of laws.
14. Heading; References. All headings used herein are used for
convenience only and shall not be used to construe or interpret this Note.
Except where otherwise indicated, all references herein to Sections refer to
Sections hereof.
6
IN WITNESS WHEREOF, the Company has caused this Note to be issued this
_____ day of ___________, 1999.
PINNACLE TOWERS III INC.
By_________________________________
Xxxxxx X. Day, Vice President
Name of Holder: ____________
Address: ___________________
___________________
7
Exhibit B
AMENDED AND RESTATED
ARTICLES OF INCORPORATION
OF
PINNACLE TOWERS III INC.
In accordance with Section 607.1007 of the Florida Business Corporation Act
("FBCA"), the Articles of Incorporation of Pinnacle Towers III Inc., a Florida
corporation (the "Corporation"), are hereby amended and restated to read in
their entirety as follows:
ARTICLE I. NAME
----------------
The name of the Corporation is:
PINNACLE TOWERS III INC.
ARTICLE II. ADDRESS
--------------------
The mailing address of the Corporation is:
0000 Xxxxxxxx Xxxxxxxxx
Xxxxxxxx, Xxxxxxx 00000
ARTICLE III. COMMENCEMENT OF EXISTENCE
---------------------------------------
The existence of the Corporation will commence at 12:01 A.M., the date of
filing of these Articles of Incorporation.
ARTICLE IV. PURPOSE
--------------------
The Corporation is organized to engage in any activity or business
permitted under the laws of the United States and Florida.
ARTICLE V. AUTHORIZED CAPITAL
------------------------------
A. AUTHORIZED SHARES. The total number of shares of capital stock that
-----------------
the Corporation has authority to issue is:
1. 1,960,440 shares of Voting Common Stock, par value $0.001 per
share (the "Voting Common");
-------------
2. 1,965,000 shares of Nonvoting Common Stock, par value $0.001 per
share (the "Nonvoting Common"); and
----------------
3. 1,000,000 shares of Preferred Stock, par value $0.001 per share
(the "Preferred Stock").
---------------
B. COMMON STOCK. The Voting Common and the Nonvoting Common are
------------
collectively referred to as the "Common Stock". The shares may be issued from
------------
time to time as authorized by the Board of Directors of the Corporation without
further approval of the shareholders of the Corporation, except as otherwise
provided herein or to the extent that such approval is required by statute, law,
rule or regulation. Shares of Common Stock will have the rights, preferences
and limitations set forth below. Capitalized terms used and not otherwise
defined in this Section B shall have the meaning set forth in Section 9.
1. Voting Rights. Except as otherwise provided in this Article V or
-------------
as otherwise required by applicable law, (a) holders of Voting Common shall be
entitled to one vote per share on all matters to be voted on by the shareholders
of the Corporation, and (b) holders of Nonvoting Common shall have no right to
vote on any matter to be voted on by the shareholders of the Corporation, except
as otherwise required by statute, law, rule or regulation.
2. Dividends. As and when dividends are declared or paid thereon,
---------
whether in cash, property or securities of the Corporation, the holders of
Common Stock shall be entitled to participate in such dividends ratably on a per
share basis; provided, that (i) if dividends are declared that are payable in
--------
shares of Voting Common or Nonvoting Common then dividends shall be payable at
the same rate on each such class of Common Stock and the dividends payable in
shares of Voting Common shall be payable to holders of Voting Common, and
dividends payable in shares of Nonvoting Common shall be payable to holders of
Nonvoting Common, and (ii) if the dividends consist of other voting securities
of the Corporation, then the Corporation shall make available to each holder of
Nonvoting Common, at such holder's request, dividends consisting of non-voting
securities of the Corporation which are otherwise identical to such other voting
securities.
3. Liquidation. The holders of Common Stock shall be entitled to
-----------
participate ratably on a per share basis in all distributions to the holders of
Common Stock in any liquidation, dissolution or winding up of the Corporation.
2
4. Stock Splits And Stock Dividends. If there are any shares of
--------------------------------
Common Stock issued and outstanding, the Corporation will not in any manner
subdivide (by stock split, stock dividend or otherwise) or combine (by reverse
stock split or otherwise) the outstanding shares of Common Stock of one class
unless the outstanding Common Stock of all the other classes will be
proportionately subdivided or combined. All such subdivisions will be payable
only in Voting Common only to the holders of Voting Common and in Nonvoting
Common only to the holders of Nonvoting Common.
5. Percentage Limits. No share of Common Stock will be sold or
-----------------
otherwise transferred (with or without consideration) to any individual if such
transfer would result in the ownership by such individual in combination with
four or fewer individuals (within the meaning of Section 542(a)(2) of the
Internal Revenue Code of 1986 (the "Code")) of more than fifty percent of the
aggregate value of all shares of all classes of capital stock of the Corporation
(the "Percentage Ownership Limit").
--------------------------
6. Distributions. Subject to any right of any holder of Preferred
-------------
Stock to receive any distribution whether in cash, property or securities and
whether by dividend, liquidation, distribution or otherwise ("Distribution"),
the holders of Common Stock will be entitled to receive any Distribution ratably
among such holders on the basis of the number of shares of Common Stock held by
such holders.
7. Approval by Voting Common. So long as any Voting Common remains
-------------------------
outstanding, without the prior written consent of the holders of
a majority of the outstanding shares of Voting Common, the
Corporation will not, nor will it permit any Subsidiary to (i)
issue any Senior Securities, Pari Passu Securities or Common
Stock, other than to issue up to 5,000 additional shares of
Nonvoting Common in order for it, in the judgment of any officer
of the Corporation, to obtain or maintain the status of the
Corporation as a Real Estate Investment Trust under Section 856-
860 of the Code; (ii) redeem, purchase or otherwise acquire
directly or indirectly any Pari Passu Securities or Common Stock,
(iii) sell, transfer, assign or dispose of or lease to one or
more Affiliates in one or more related series of transactions or
take any similar action with respect to any substantial portion
of the Corporation's assets, or make any material acquisition of
assets, other than pursuant to that certain Agreement for
Purchase and Sale effective as of August 31, 1999, between the
Corporation and Pinnacle Towers Inc., a Delaware corporation;
(iv) Incur in excess of $100,000 in Debt for borrowed money; (v)
enter into a transaction with an Affiliate
3
of the Corporation involving consideration in excess of $10,000;
(vi) directly or indirectly pay or declare any dividend or make
any distribution upon any Pari Passu Securities or any Common
Stock; or (v) Incur or suffer to exist any Lien on or with
respect to any property or assets now owned or hereafter acquired
to secure any Debt.
8. Reserved Shares. The Corporation will at all times reserve and
---------------
keep available out of its authorized Voting Common a sufficient number of shares
of Voting Stock to issue upon conversion of any shares of "Series A. Preferred"
(as defined herein) or indebtedness of the Corporation that is outstanding from
time to time that is convertible into Voting Common to satisfy the Corporation's
obligations to issue Voting Common upon any such conversions.
8. Definitions. As used herein or in Section V (C) hereof, the
-----------
following terms have the following respective meanings:
"Capital Lease Obligation" of the Corporation means the obligation to
------------------------
pay rent or other payment amounts under a lease of (or other Debt
arrangements conveying the right to use) real or personal property of the
Corporation which is required to be classified and accounted for as a
capital lease or a liability on the face of a balance sheet of the
Corporation in accordance with generally accepted accounting principles.
The stated maturity of such obligation shall be the date of the last
payment of rent or any other amount due under such lease prior to the first
date upon which such lease may be terminated by the lessee without payment
of a penalty. The principal amount of such obligation shall be the
capitalized amount thereof that would appear on the face of a balance sheet
of the Corporation in accordance with generally accepted accounting
principles.
"Debt" means (without duplication), with respect to the Corporation,
----
whether recourse is to all or a portion of the assets of the Corporation
and whether or not contingent, (i) every obligation of the Corporation for
money borrowed, (ii) every obligation of the Corporation evidenced by
bonds, debentures, notes or other similar instruments, including
obligations Incurred in connection with the acquisition of property, assets
or businesses, (iii) every reimbursement obligation of the Corporation with
respect to letters of credit, bankers' acceptances or similar facilities
issued for the account of the Corporation, (iv) every obligation of the
Corporation issued or assumed as the deferred purchase price of property or
services (including securities repurchase agreements but excluding trade
accounts payable or accrued liabilities arising in the ordinary course of
business which are not overdue or
4
which are being contested in good faith), (v) every Capital Lease
Obligation of the Corporation, (vi) all Receivables Sales of the
Corporation, together with any obligation of the Corporation to pay any
discount, interest, fees, indemnities, penalties, recourse, expenses or
other amounts in connection therewith, (vii) every obligation under
Interest Rate or Currency Protection Agreements of the Corporation and
(viii) every obligation of the type referred to in clauses (i) through
(vii) of another Person and all dividends of another Person the payment of
which, in either case, the Corporation has Guaranteed or is responsible or
liable, directly or indirectly, as obligor, Guarantor or otherwise. The
"amount" or "principal amount" of Debt at any time of determination as used
herein represented by (a) any contingent Debt, shall be the maximum
principal amount hereof, (b) any Debt issued at a price that is less than
the principal amount at maturity thereof, shall be the amount of the
liability in respect thereof determined in accordance with generally
accepted accounting principals, and (c) any Receivables Sale, shall be the
amount, if any, in connection with such Receivables Sale for which there is
recourse to the seller or any of its Subsidiaries.
"Guarantee" of the Corporation means any obligation, contingent
---------
or otherwise, of the Corporation guaranteeing, or having the economic
effect of guaranteeing, any Debt of any other Person (the "Primary
-------
Obligor") in any manner, whether directly or indirectly, and including,
-------
without limitation, any obligation of such Person, (i) to purchase or pay
(or advance or supply funds for the purchase or payment of) such Debt or to
purchase (or to advance or supply funds for the purchase of) any security
for the payment of such Debt, (ii) to purchase property, securities or
services for the purpose of assuring the holder of such Debt of the payment
of such Debt, or (iii) to maintain working capital, equity or other
financial statement condition or liquidity of the Primary Obligor so as to
enable the Primary Obligor to pay such Debt (and "Guaranteed",
"Guaranteeing" and "Guarantor" shall have the meanings correlative to the
foregoing); provided, however, that the Guarantee by the Corporation shall
not include endorsements by the Corporation for collection or deposit, in
either case, in the ordinary course of business.
"Incur" means, with respect to any Debt or other obligation of the
-----
Corporation, to create, issue, incur (by conversion, exchange or
otherwise), assume, Guarantee or otherwise become liable in respect of such
Debt or other obligation or the recording, as required pursuant to
generally accepted accounting principles or otherwise, of any such Debt or
other obligation on the balance sheet of the Corporation (and "Incurrence",
"Incurred", "Incurable" and "Incurring" shall have meanings correlative to
the foregoing); provided, however, that a change in generally accepted
accounting principles
5
that results in an obligation of the Corporation that exists at such time
becoming Debt shall not be deemed an Incurrence of such Debt.
"Interest Rate or Currency Protection Agreement" of the Corporation
----------------------------------------------
means any forward contract, futures contract, swap, option or other
financial agreement or arrangement (including, without limitation, caps,
floors, collars and similar agreements) relating to, or the value of which
is dependent upon, interest rates or currency exchange rates or indices.
"Junior Securities" means any capital stock or other equity securities
-----------------
of the Corporation, except for the Series A Preferred (as defined below),
Senior Securities and Pari Passu Securities.
"Liquidation Value" means, in relation to any Share, $1,000,000.
-----------------
"Pari Passu Securities" means shares of any series of preferred stock
---------------------
of the Corporation created and authorized in accordance with the Articles
of Incorporation of the Corporation, if the terms of such series expressly
provide that shares of such series will be "Pari Passu Securities" with
respect to the Series A Preferred.
"Person" means any individual, corporation, partnership, joint
------
venture, trust, unincorporated organization or government or any agency or
political subdivision thereof.
"Receivables" means receivables, chattel paper, instruments, documents
-----------
or intangibles evidencing or relating to the right to payment of money.
"Receivables Sale" of the Corporation means any sale of Receivables of
----------------
the Corporation (pursuant to a purchase facility or otherwise), other than
in connection with a disposition of the business operations of the
Corporation relating thereto or a disposition of defaulted Receivables for
purpose of collection and not as a financing arrangement.
"Senior Securities" means shares of any series of preferred stock of
-----------------
the Corporation created and authorized in accordance with the Articles of
Incorporation of the Corporation, if the terms of such other series
expressly provide that shares of such series will be "Senior Securities"
with respect to the Series A Preferred.
"Subsidiary" means any corporation of which the shares of outstanding
----------
capital stock possessing the voting power (under ordinary
6
circumstances) in electing the board of directors are, at the time as of
which any determination is being made, owned by the Corporation either
directly or indirectly through Subsidiaries.
C. PREFERRED STOCK.
---------------
1. Generally. Shares of Preferred Stock may be issued from time to
---------
time in one or more series. The Board of Directors of the Corporation without
further approval by the shareholders of the Corporation is hereby expressly
authorized to determine and alter all rights, preferences, privileges,
qualifications, limitations and restrictions of any such series (including,
without limitation, voting rights and the limitation and exclusion of voting
rights) of Preferred Stock and the number of shares constituting any such series
and the designation thereof, and to increase or decrease (but not below the
number of shares of such series then outstanding) the number of shares of any
series after the issuance of shares of that series. If the number of shares of
any series is so decreased, then the shares constituting such reduction will
resume the status that such shares had prior to the adoption of the resolution
originally fixing the number of shares of such series. No share of any series
of Preferred Stock will be sold or otherwise transferred (with or without
consideration) to any individual if such transfer would result in a violation of
the Percentage Ownership Limit.
2. Voting Rights. The holders of shares of Preferred Stock shall
-------------
not be entitled to vote except unless established by the Board of Directors or
otherwise required by statute, law, rule or regulation.
3. Stock to be Reserved. The Corporation will at all times reserve
--------------------
and keep available out of its authorized Preferred Stock, solely for the purpose
of paying dividends, such number of shares of Preferred Stock as shall be
required to satisfy only dividend requirements.
4. Retirement of Shares. Shares of Preferred Stock that are
--------------------
redeemed by the Corporation shall be permanently retired and shall not under any
circumstances be reissued.
5. Series A Convertible Preferred Stock.
------------------------------------
5(a). Designation and Number of Shares. The Corporation is hereby
--------------------------------
authorized to issue from time to time a total of 100 shares of Preferred Stock
to be designated Series A Convertible Preferred Stock, with $0.001 par value per
share, having the preferences, qualifications, rights and privileges set forth
herein (the "Series A Preferred"). Capitalized terms used and not otherwise
------------------
defined in this Section 5 shall have the meanings set forth in Section B(8)
above.
7
5(b). Rank.
----
(i) Priority. The Series A Preferred will rank with respect to
--------
dividend rights and rights on liquidation, winding up and dissolution: (a)
senior to the Common Stock and all other Junior Securities; (b) pari passu with
all Pari Passu Securities; and (c) junior to all Senior Securities.
(ii) Distributions. Any distribution made pursuant to dividend
-------------
rights or rights on liquidation, winding up, or dissolution will be made to the
holders of the Corporation's securities in accordance with the relative
priorities set forth above, and any such distribution will fully satisfy the
Corporation's obligations to the holders of a senior security prior to any
distribution to the holders of any Junior Security.
5(c). Dividends.
---------
(i). General Obligation. When and as declared by the
------------------
Corporation's Board of Directors and to the extent permitted under the FBCA of
the State of Florida, and subject to the terms of any Senior Securities, the
Corporation will pay preferential dividends to the holders of the Series A
Preferred as provided in this Section 5(c)(i). Dividends on each share of the
Series A Preferred (a "Share") will accrue on a daily basis at the rate of 18%
-----
per annum of the sum of the Liquidation Value thereof from time to time plus all
accumulated and unpaid dividends thereon from and including the date of issuance
of such Share to and including the first to occur of: (a) the date on which the
Liquidation Value of such Share (plus all accrued and unpaid dividends thereon)
is paid to the holder thereof in connection with the liquidation of the
Corporation; or (b) the date on which such Share is acquired by the Corporation.
Such dividends will accrue whether or not they have been declared and whether or
not there are profits, surplus or other funds of the Corporation legally
available for the payment of dividends. The date on which the Corporation
initially issues any Share will be deemed to be its "date of issuance"
regardless of the number of times transfer of such Share is made on the stock
records maintained by or for the Corporation and regardless of the number of
certificates which may be issued to evidence such Share.
(ii) Dividend Reference Dates. To the extent not paid on March
------------------------
31, June 30, September 30 or December 31 of any year, beginning with the first
such date after the date of issuance of the Share in question (each a "Dividend
--------
Reference Date"), all dividends which have accrued on each Share outstanding
--------------
during the three-month period (or other period, in the case of the first
Dividend Reference Date after the date of issuance of such Share) ending upon
each such Dividend Reference Date will be accumulated and will remain
accumulated and accrue dividends with respect to such Share until paid to the
holder thereof.
8
(iii) Distribution of Partial Dividend Payments. If at any time
-----------------------------------------
the Corporation pays less than the total amount of dividends then accrued with
respect to the Series A Preferred, such payment will be distributed pro rata
among the holders thereof based upon the rank and number of Shares held by each
such holder.
5(d). Liquidation. Subject to the terms of any Senior Securities,
-----------
upon any liquidation, dissolution or winding up of the Corporation (whether
voluntary or involuntary), each holder of Series A Preferred will be entitled to
be paid, after any required distribution or payment is made upon any Senior
Securities, before any distribution or payment is made upon any Junior
Securities, and on a pari passu basis (pro rata according to the relative
amounts to be paid) with any required distribution or payment to be made upon
any Pari Passu Securities, an amount in cash equal to the aggregate Liquidation
Value of all Shares held by such holder (plus all accrued and unpaid dividends
thereon), and the holders of Series A Preferred will not be entitled to any
further payment. If upon any such liquidation, dissolution or winding up of the
Corporation the Corporation's assets to be distributed among the holders of the
Series A Preferred and any Pari Passu Securities are insufficient to permit
payment to such holders of the aggregate amount which they are entitled to be
paid under this Section 5(d), then the entire assets available to be distributed
to the Corporation's shareholders will be distributed pro rata among the holders
of Series A Preferred and any Pari Passu Securities based upon the aggregate
Liquidation Value (plus all accrued and unpaid dividends) of the Series A
Preferred, and the comparable amount payable to the holders of any Pari Passu
Securities, held by each such holder. Neither the consolidation or merger of
the Corporation into or with any other entity or entities (whether or not the
Corporation is the surviving entity), nor the sale or transfer by the
Corporation of all or any part of its assets, nor the reduction of the capital
stock of the Corporation nor any other form of recapitalization or
reorganization affecting the Corporation will be deemed to be a liquidation,
dissolution or winding up of the Corporation within the meaning of this Section
5(d).
5(e). Voting Rights. Except as otherwise may be required herein or by
-------------
the FBCA, the holders of the Series A Preferred will not be entitled to notice
of any meeting of the shareholders of the Corporation and will not be entitled
to vote, together with any other shareholders or as a separate class, on any
matter to be voted on by the Corporation's shareholders.
5(e) Approval by Series A Preferred. So long as any Series A
------------------------------
Preferred remains outstanding, without the prior written consent of the holders
of a majority of the outstanding shares of Series A Preferred, the Corporation
will not, nor will it permit any Subsidiary to (i) issue any Senior Securities
or Pari Passu
9
Securities; (ii) redeem, purchase or otherwise acquire directly or indirectly
any Pari Passu Securities or Junior Securities; (iii) sell, transfer, assign or
dispose of or lease to one or more Affiliates in one or more related series of
transactions or take any similar action with respect to a majority of the
Corporation's assets; or (iv) directly or indirectly pay or declare any dividend
or make any distribution upon any Pari Passu Securities or any Junior
Securities.
5(f). Conversion Rights. Each share of Series A Preferred shall be
-----------------
convertible by the holder thereof at any time into a number of shares of voting
or nonvoting Common Stock or in any combination thereof as selected by the
holder equal to the Liquidation Value of such share plus, without duplication,
all accrued and unpaid dividends thereon divided by 25, with such number being
subject to such adjustments to account for any increase or decrease in the
number of outstanding shares of Common Stock that results from a stock split,
stock dividend, combination of shares, merger or other event affecting the
number of outstanding shares of Common Stock (the "Conversion Shares"), which
conversion shall be effective no later than one business day after a notice of
conversion is delivered by the holder thereof to the Corporation.
5(g). Registration of Transfer. The Corporation will keep at its
------------------------
principal office a register for the registration of Series A Preferred. Upon
the surrender of any certificate representing Series A Preferred at such place,
the Corporation will, at the request of the record holder of such certificate,
execute and deliver (at the Corporation's expense) a new certificate or
certificates in exchange therefor representing in the aggregate the number of
Shares represented by the surrendered certificate. Each such new certificate
will be registered in such name and will represent such number of Shares as is
requested by the holder of the surrendered certificate and will be substantially
identical in form to the surrendered certificate, and dividends will accrue on
the Series A Preferred represented by such new certificate from the date to
which dividends have been fully paid on such Series A Preferred represented by
the surrendered certificate.
5(h). Replacement. Upon receipt of evidence reasonably satisfactory
-----------
to the Corporation (provided that an affidavit of the registered holder will be
satisfactory) of the ownership and the loss, theft, destruction or mutilation of
any certificate evidencing Share(s), and in the case of any such loss, theft or
destruction, upon receipt of indemnity reasonably satisfactory to the
Corporation (provided that if the holder is a financial institution or other
institutional investor its own agreement will be satisfactory), or, in the case
of any such mutilation upon surrender of such certificate, the Corporation will
(at its expense) execute and deliver in lieu of such certificate a new
certificate of like kind representing the number of Shares of such Series
represented by such lost, stolen, destroyed or mutilated certificate and dated
the date of such lost, stolen, destroyed or mutilated
10
certificate, and dividends will accrue on the Series A Preferred represented by
such new certificate from the date to which dividends have been fully paid on
such lost, stolen, destroyed or mutilated certificate.
5(i). Amendment and Waiver. No amendment, modification or waiver
--------------------
will be binding or effective with respect to any provision of any of Sections
5(a) through 5(i) hereof without the prior written consent of the holders of a
majority of the Series A Preferred outstanding at the time such action is taken;
provided that no change in the terms hereof may be accomplished by merger or
consolidation of the Corporation with another corporation or entity unless the
Corporation has obtained the prior written consent of the holders of a majority
of the Series A Preferred then outstanding.
D. TRANSFER OF STOCK.
-----------------
1. Transfer Restrictions. Inasmuch as it is the intention of the
---------------------
Corporation and its shareholders that the Corporation satisfy the provisions of
the Code relating to qualification of the Corporation as a "real estate
investment trust," particularly Section 856(a)(5) of the Code, no holder of any
share of any capital stock may transfer any such share or any interest therein
to any other individual, firm, corporation, entity or other person if, as a
result of such transfer, either (i) beneficial ownership of all shares of all
classes of capital stock would be held by less than 100 persons (the "Aggregate
---------
Ownership Limit"), if beneficial ownership of all shares of all classes of
---------------
capital stock was held by 100 or more persons prior to such transfer, or (ii) a
violation of the Percentage Ownership Limit would occur.
2. Registration of Transfers. The Corporation will keep at its
-------------------------
principal office (or such other place as the Corporation reasonably designates)
a register for the registration of shares of Common Stock and Preferred Stock.
Upon the surrender at such place of any certificate representing shares of any
class of capital stock with respect to all of which a transfer would satisfy all
requirements of paragraph 1 of this Part D, the Corporation will, at the request
of the registered holder of such certificate, execute and deliver a new
certificate or certificates in exchange therefor representing in the aggregate
the number of shares of the class represented by the surrendered certificate,
and the Corporation forthwith will cancel such surrendered certificate. Each
such new certificate will be registered in such name and will represent such
number of shares of such class as is requested by the holder of the surrendered
certificate (so long as the requirements of this paragraph 2 and paragraph 1 of
this Part D are otherwise satisfied with respect to the capital stock
represented by such certificate) and will be substantially identical in form to
the surrendered certificate. The issuance of new certificates will be made
without charge to the holders of the surrendered certificates for any issuance
tax in
11
respect thereof or other cost incurred by the Corporation in connection with
such issuance.
3. Replacement. Upon receipt of evidence reasonably satisfactory to
-----------
the Corporation (an affidavit of the registered holder being satisfactory) of
the ownership and the loss, theft, destruction or mutilation of any certificate
evidencing one or more shares of any class of Common Stock or Preferred Stock,
and in the case of any such loss, theft or destruction, upon receipt of
indemnity reasonably satisfactory to the Corporation (provided that if the
holder is a financial institution or other institutional investor then its own
agreement will be satisfactory) or, in the case of any such mutilation upon
surrender of such certificate, the Corporation will (at its expense), execute
and deliver in lieu of such certificate a new certificate of like kind
representing the number of shares of such class represented by such lost,
stolen, destroyed or mutilated certificate and dated the date of such lost,
stolen, destroyed or mutilated certificate.
4. Amendment And Waiver. No amendment or waiver of any provision of
---------------------
this Part D will be effective without the prior approval of the holders of a
majority of the votes entitled to be cast by the holders of Voting Common.
E. UNAUTHORIZED TRANSFERS.
----------------------
1. Effect Of Unauthorized Transfers. Any transfer of any share of
--------------------------------
any class of capital stock of the Corporation in violation of the Percentage
Ownership Limit, the Aggregate Ownership Limit, and/or any other restriction or
requirement specified in this Article V (a "Purported Transfer") will be void
------------------
and of no legal effect. Any Purported Transfer will cause (without action on
the part of the Corporation, the transferee (the "Prohibited Transferee"), or
---------------------
the transferor) all shares (or interests therein) involved in such Purported
Transfer to be transferred to the Corporation, as trustee (in such capacity, the
"Trustee") in trust for the exclusive benefit of one or more organizations
-------
described in Section 501(c)(3) of the Code (the "Charitable Beneficiaries").
------------------------
The Trustee will be deemed to own such shares for the benefit of the Charitable
Beneficiaries on the day prior to the date of the Purported Transfer. Any
dividends or distributions paid by the Corporation to the Purported Transferee
prior to discovery of a Purported Transfer, will be disgorged and repaid to the
Corporation, as Trustee, by the Prohibited Transferee. Any dividend declared
after a Purported Transfer but unpaid will be rescinded as void ab initio with
respect to the Prohibited Transferee. Any dividends so disgorged or rescinded
will then be paid over to the Trustee and held in trust for the Charitable
Beneficiaries. Any vote taken by a Prohibited Transferee prior to the discovery
by the Corporation of a Purported Transfer will be rescinded as void ab initio.
With respect to the shares involved in the Purported Transfer, the Trustee will
be deemed to have an irrevocable proxy to vote such shares for the benefit of
the Charitable Beneficiaries.
12
2. Notification Of Proposed Transfers. In order that the Corporation
----------------------------------
may enforce the Aggregate Ownership Limit and the Percentage Ownership Limit, no
share of any class or series of capital stock of the Corporation will be
transferable by the holder thereof unless, not less than 30 days prior to any
such proposed transfer, the holder of any and all shares proposed to be
transferred ("Transferred Shares") delivers to the Corporation written notice of
------------------
its intention to effect such a transfer.
3. Legend. Each certificate for shares of capital stock of the
------
Corporation shall bear substantially the following legend:
"The shares represented by this certificate are subject to
restriction on transfer and ownership for the purpose of the
Corporation's maintenance of its status as a Real Estate
Investment Trust under the Code. Subject to certain further
restrictions and except as expressly provided in the
Corporation's articles of incorporation, as amended, any transfer
of any share of capital stock of the Corporation will be void and
of no legal effect if such transfer would result in (i) the
ownership by five or fewer individuals of more than fifty percent
of the aggregate value of all shares of capital stock of the
Corporation or (ii) beneficial ownership of all shares of common
stock would be held by less than 100 persons. Any shares of
capital stock purported to be transferred in violation of these
restrictions will be automatically transferred to the
Corporation, as trustee, for the benefit of one or more
charitable beneficiaries. A copy of the Corporation's articles of
incorporation, as amended, including the foregoing restrictions
on transfer, will be sent without charge to each shareholder who
so requests."
ARTICLE VI. ACTION BY SHAREHOLDERS
-----------------------------------
1. Shareholder Action by Unanimous Written Consent. Any action required
-----------------------------------------------
or permitted to be taken at an annual or special meeting of the
shareholders of the Corporation may be taken without a meeting,
without prior notice, and without a vote if the action is taken by
written consent of the holders of at least 95% of the outstanding
stock of each voting group entitled to vote thereon.
2. Record Date. For the purpose of determining the shareholders for any
-----------
purpose other than for determining shareholders entitled to notice of
and to vote at an annual or special shareholders meeting, the Board of
Directors shall fix a record date, which shall be not more than
seventy days before the date written notice of the record date is
13
delivered to the shareholders. If no record date is set by the Board
of Directors, the record date shall be determined as follows: for
determining shareholders entitled to demand a special meeting, the
record date is the date the first such demand is delivered to the
Corporation; and for determining shareholders entitled to a share
dividend, the record date is the date the Board of Directors
authorizes the dividend. For determining shareholders entitled to
notice of and to vote at an annual or special shareholders meeting the
record date is as of the close of business on the date that is seven
days after notice of the record date is first delivered or deemed
delivered to the shareholders entitled to notice thereof; provided,
however, that no record date shall occur within the last five calendar
days of a calendar quarter. When a determination of the shareholders
entitled to vote at any meeting has been made, that determination
shall apply to any adjournment of the meeting, unless the Board of
Directors fixes a new record date. The Board of Directors shall fix a
new record date if the meeting is adjourned to a date more than 120
days after the date fixed for the original meeting. Notwithstanding
anything contained herein to the contrary, irrespective of whether
prior action is required by the Board of Directors, the record date
for determining shareholders entitled to take action without a meeting
is the date a signed written consent is delivered to the Corporation
by the holders of at least 95% of the outstanding stock of each voting
group entitled to vote thereon.
3. Special Shareholder Meetings. No special meeting of the shareholders
----------------------------
of the Corporation shall occur within the last five calendar days of a
calendar quarter.
ARTICLE VII. INITIAL REGISTERED OFFICE AND AGENT
-------------------------------------------------
The street address of the current registered office of the Corporation is
0000 Xxxxx Xxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxx 00000, and the name of the
Corporation's current registered agent at that address is CT Corporation
Systems.
ARTICLE VIII. INITIAL BOARD OF DIRECTORS
-----------------------------------------
The Corporation shall have two directors initially. The number of
directors may be either increased or diminished from time to time, as provided
in the bylaws, but shall never be less than one. The names and street addresses
of the initial directors are:
Name Address
---- -------
14
Xxxxxx X. Day 0000 Xxxxxxxx Xxxxxxxxx, Xxxxx Xxxxx
Xxxxxxxx, Xxxxxxx 00000
Xxxxxx X. Xxxxxx 0000 Xxxxxxxx Xxxxxxxxx, Xxxxx Xxxxx
Xxxxxxxx, Xxxxxxx 00000
ARTICLE IX. BYLAWS
-------------------
The power to adopt, alter, amend or repeal bylaws shall be vested in the
Board of Directors and the shareholders, except that the Board of Directors may
not amend or repeal any bylaws or article or provision thereof without the
affirmative vote of the holders of the outstanding stock of each voting group
entitled to vote thereon if the bylaws provide that they or such article or
provision is not subject to amendment or repeal by the Board of Directors.
15
ARTICLE X. AMENDMENTS
----------------------
The Corporation reserves the right to amend, alter, change or repeal any
provision in these Articles of Incorporation in the manner prescribed by law,
and all rights conferred on shareholders are subject to this reservation.
16
IN WITNESS WHEREOF, the
undersigned has executed these
Amended and Restated Articles of
Incorporation this ___ day of
October, 1999.
____________________________
Xxxxxx X. Day, Secretary
17
CERTIFICATE TO AMENDED AND RESTATED ARTICLES OF
INCORPORATION OF PINNACLE TOWERS III INC.
The undersigned, Xxxxxx X. Day, Secretary of PINNACLE TOWERS III INC., a
Florida corporation (the "Corporation"), does hereby certify as follows:
1. In accordance with Sections 607.1006 and 607.1007 of the Florida
Statutes, the foregoing Amended and Restated Articles of Incorporation
were duly adopted by the Board of Directors and by the holders of a
majority of the Voting Common and Series A Preferred of the
Corporation on October ____, 1999. The number of votes cast for the
amendment by the Corporation's shareholders, constitutes a sufficient
number of votes to approve the amendment.
2. The undersigned officer of the Corporation has been duly authorized to
submit these Amended and Restated Articles of Incorporation of the
Corporation to the Department of State of Florida for filing in
accordance with Section 607.1007 of the Florida Statutes.
PINNACLE TOWERS III INC.
By:____________________________
Xxxxxx X. Day, Secretary
18
Exhibit C
COST AND EXPENSE SHARING AND REIMBURSEMENT AGREEMENT
----------------------------------------------------
THIS COST AND EXPENSE SHARING AND REIMBURSEMENT AGREEMENT (this
"Agreement") is effective as of the 31st day of August, 1999, by and between
PINNACLE TOWERS INC., a Delaware corporation ("PTI") and Pinnacle Towers III
Inc., a Florida corporation ("PT3").
WHEREAS, PT3 owns certain assets which it acquired from PTI; and
WHEREAS, in connection with the conduct of its business, PT3 considers it
necessary or convenient to avail itself of certain of PTI's personnel,
facilities and general and administrative overhead, and PTI is willing to make
such available to PT3; and
WHEREAS, PT3 has agreed to reimburse PTI for its allocable share of the
cost and expense of such shared personnel, facilities and general and
administrative overhead as determined in the manner hereinafter provided;
NOW, THEREFORE, in consideration of the representations, warranties,
covenants and agreements herein contained, the parties agree as follows:
1. Provision of Shared Costs and Expenses. During the term of this
--------------------------------------
Agreement, upon the reasonable request of PT3, PTI will make available to PT3
any of PTI's office and administrative personnel and facilities, consultants and
contractors, and general and administrative office overhead and costs, including
inter alia office space, record retention, photocopy facilities, facsimile and
telephone equipment, sales and marketing support, office supplies, and computer
services (collectively, the "Shared Costs and Expenses").
2. Reimbursement. PT3 agrees to reimburse PTI for the costs and expenses
-------------
incurred by PTI on behalf of or for the benefit of PT3 in an amount equal to the
sum of the following amounts (the "Reimbursement Amount") determined annually as
of the end of each calendar year:
(a) With respect to any Shared Costs and Expenses directly
attributable solely to PT3, an amount equal to the marginal or incremental
cost or expense thereof incurred by PTI; and
(b) With respect to any Shared Costs and Expenses not described in
(a) above, the pro rata share of such Shared Costs and Expenses based on
the product obtained by multiplying the gross amount of such Shared Costs
and Expenses by the quotient obtained by dividing the gross revenues of PT3
for the year by the sum of the gross revenues for the year of both PTI and
PT3, or an amount determined on such other reasonable basis as the parties
may mutually agree.
The Reimbursement Amount for each calendar year shall be determined no later
than three months after the end of such calendar year and payment of the
Reimbursement Amount shall be due on or before the April 10/th/ of the year
following the end of such calendar year.
3. Standard of Care. PTI agrees that it and its personnel shall exercise
----------------
the same degree of diligence, care and prudence in connection with matters
conducted on behalf of, or provided for the benefit of, PT3 as it exercises
matters conducted on its own behalf or provided for its own benefit.
4. Limitation of Liability.
-----------------------
(a) PTI and its Affiliates, and the officers, directors,
employees, shareholders, partners, representatives, consultants and
agents of PTI and its Affiliates (collectively, "Providing Parties")
shall not be liable to the party on whose behalf the Shared Costs and
Expenses are incurred, its Affiliates, or to any officer, director,
employee, shareholder, partner, representative, consultant or agent of
such party or its Affiliates (collectively, "Receiving Parties"), for
any liability, cost, damage, expense or loss, including, without
limitation, any special, indirect, consequential or punitive damages
(i) arising or allegedly arising out of any actions or failures to act
by any of the Providing Parties with respect to the Shared Costs and
Expenses to be provided hereunder, or (ii) as a result of the reliance
by any of the Receiving Parties on any advice or data that any of the
Providing Parties may provide pursuant to this Agreement; provided,
however, that the foregoing shall not apply to limit liability of a
party to the extent caused by such party's gross negligence or willful
misconduct.
(b) The Receiving Parties shall indemnify and hold harmless
each and every of the Providing Parties from and against any
liability, cost, damage, expense or loss (including court costs and
reasonable attorneys' fees) which such Providing Parties may sustain
or incur by reason of any claim, demand, suit or recovery by any
person or entity, directly resulting from acts or omissions committed
by the Receiving Party in connection with this Agreement; provided,
however, that no person may benefit from the foregoing indemnity in
the event of its gross negligence or willful misconduct.
5. Term. The term of this Agreement shall commence as of the date hereof
----
and end December 31, 2000, unless earlier terminated effective as of the end of
a calendar month by either party upon no less than two months' prior written
notice to the other party. The term of this Agreement shall automatically renew
for successive periods of one year each unless either party provides to the
other party notice in writing that this Agreement will not so renew and such
notice is given at least two months prior to the then termination date of this
Agreement. In the event this Agreement is terminated prior to the end of a
calendar year, the Reimbursement Amount shall be determined as of the effective
date of termination based on gross revenues of each party through the date of
termination.
2
6. Relationship of the Parties. In all matters relating to this
---------------------------
Agreement, each party hereto shall be solely responsible for the acts of its
employees, and employees of one party shall not be considered employees of the
other party. No party shall have any right, power or authority to create any
obligation, express or implied, on behalf of any other party. Nothing in this
Agreement is intended to create or constitute a joint venture or partnership
relationship between the parties hereto or persons referred to herein.
7. Force Majeure. PTI shall be excused from performance hereunder for
-------------
any period and to the extent that it is prevented from performance hereunder, in
whole or in part, as a result of delays caused by PT3 or any act of God, war,
civil disturbance, court order, strike, labor dispute, law or regulation of any
governmental authority, or other cause beyond the reasonable control of PTI.
Such nonperformance shall not be a default hereunder. PTI shall take all
reasonable actions to resume performance of its obligations hereunder as soon as
feasible.
8. Amendments and Waiver. No amendment, waiver or consent with respect
---------------------
to any provision of this Agreement shall in any event be effective, unless the
same shall be in writing and signed by the parties hereto, and then such
amendment, waiver or consent shall be effective only in the specific instance
and for the specific purpose for which given.
9. Notices. All notices, requests, demands and other communications
-------
hereunder shall be in writing and shall be, personally delivered or sent by
facsimile transmission with confirming copy sent by overnight courier (such as
Express Mail, Federal Express, etc.) and a delivery receipt obtained and
addressed to the intended recipient as follows:
If to PTI:
Pinnacle Towers Inc.
0000 Xxxxxxxx Xxxxxxxxx
Xxxxx Xxxxx
Xxxxxxxx, Xxxxxxx 00000
Attention: Xxx Xxxxxxx
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
If to PT3:
3
Pinnacle Towers III Inc.
0000 Xxxxxxxx Xxxxxxxxx
Xxxxx Xxxxx
Xxxxxxxx, Xxxxxxx 00000
Attention: Xxxxx Xxx
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
Any party may change its address or add or change parties for receiving notice
by written notice given to the others named above. Notices shall be deemed
given as of the date of receipt.
10. Counterparts. This Agreement may be executed in counterparts, each
------------
of which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
11. Successors and Assigns; Beneficiaries. This Agreement shall bind and
-------------------------------------
inure to the benefit of the parties named herein and their respective
successors and assigns. No party may assign any rights, benefits, duties or
obligations under this Agreement without the prior written consent of the other
party. Except as specifically provided in Section 4, no third party shall be
entitled to enforce any provision hereof; and no third party is intended to
benefit from this Agreement.
12. Entire Agreement. This Agreement and the documents referred to herein
----------------
contain the entire agreement and understanding among the parties with
respect to the transactions contemplated hereby and supersede all other
agreements, understandings and undertakings among the parties on the
subject matter hereof.
13. Partial Invalidity. In the event that any provision of this
------------------
Agreement shall be held invalid or unenforceable by any court or competent
jurisdiction, such holding shall not invalidate or render unenforceable any
other provision hereof.
14. Governing Law; Jurisdiction. This Agreement shall be interpreted in
---------------------------
accordance with the substantive laws of the State of Florida applicable to
contracts made and to be performed wholly within said State. All disputes,
legal actions, suits and proceedings arising out of or relating to this
Agreement shall be brought in a federal district or state court located in
Tampa, Florida. Each party hereby consents to the jurisdiction of the federal
district or state court in Tampa, Florida. Each party hereby irrevocably waives
all claims of immunity from jurisdiction and any right to object on the basis
that any dispute, action, suit or proceeding brought in the federal district or
state court of Tampa, Florida has been brought in an improper or inconvenient
venue or forum.
15. Disputes.
---------
(a) PTI and PT3 mutually desire that friendly
collaboration will develop between themselves. Accordingly, they
shall try to resolve in a friendly manner
4
all disagreements and misunderstandings connected with their
respective rights and obligations under this Agreement, including
any amendments hereof.
(b) (i) To the extent that any misunderstanding or
dispute cannot be resolved agreeably in a friendly manner, the
dispute will be mediated by a mutually acceptable mediator to be
chosen by PTI and PT3 within forty-five (45) days after written
notice by one of the parties demanding mediation. Neither party
may unreasonably withhold consent to the selection of a mediator,
however, by mutual agreement PTI and PT3 may postpone mediation
until each has completed specified but limited discovery with
respect to a dispute. The parties may also agree to attempt some
other form of alternative dispute resolution ("ADR") in lieu of
mediation, including by way of example and without limitation,
neutral fact-finding or a mini-trial.
(ii) Any dispute which the parties cannot resolve
through negotiation, mediation or other form of ADR within six
months of the date of the initial demand for it by one of the
parties may then be submitted to the courts for resolution. The
use of any ADR procedures will not be construed under the
doctrine of laches, waiver or estoppel to affect adversely the
rights of either party. Nothing in this Section 15 will prevent
either party from resorting to judicial proceedings if (A) good
faith efforts to resolve the dispute under these procedures have
been unsuccessful or (B) interim relief from a court is necessary
to prevent serious and irreparable injury to one party or to
others.
(c) Each of PT3 and PTI shall bear its costs of mediation
or ADR, but PT3 and PTI agree to share the costs of the mediation
of ADR equally.
16. Authorship. The parties hereto agree that the terms and language of
----------
this Agreement were the result of negotiations between the parties and, as a
result, there shall be no presumption that any ambiguities in this Agreement
shall be resolved against either party. Any controversy over construction of
this Agreement shall be decided without regard to events of authorship or
negotiation.
17. Defined Terms. All capitalized terms not defined herein shall have
-------------
the meanings ascribed to them in the Asset Purchase Agreement.
18. Recitals. The recitals hereto are true and correct and are by this
---------
reference incorporated herein.
5
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.
PINNACLE TOWERS INC.
_____________________________________
Xxxxxxx Xxxxxxx, President
PINNACLE TOWERS III INC.
_____________________________________
Xxxxxx X. Day, Vice President, Chief
Financial Officer and Secretary
6
