Exhibit 2.1
SHARE EXCHANGE AGREEMENT
BY AND AMONG
WESTOWER CORPORATION,
MJA COMMUNICATIONS CORP.
AND
THE STOCKHOLDERS OF MJA COMMUNICATIONS CORP:
XXXXXXX X. XXXXXXXX, XXXXXXXXX X. XXXXXXXX
AND XXXX XXXXXXXX, III
DATED AS OF MAY 29, 1998
SHARE EXCHANGE AGREEMENT
CONTENTS
ARTICLE I SHARE EXCHANGE................................................................... 1
Section 1.1 Exchange of MJA Stock..................................................... 1
Section 1.2 Increase in Number of Westower Shares Issued to Stockholders.............. 2
Section 1.3 Articles of Share Exchange................................................ 3
Section 1.4 Exchange Ratio............................................................ 3
Section 1.5 Adjustment For Changes.................................................... 3
Section 1.6 Power of Attorney......................................................... 4
ARTICLE II CLOSING AND CLOSING DOCUMENTS................................................... 5
Section 2.1 Date, Time and Place of Closing........................................... 5
Section 2.2 Stockholders' Closing Documents; Deliveries to Westower................... 5
(a) Stock Certificates.......................................................... 5
(b) MJA Good Standing Certificates.............................................. 5
(c) Stockholders' Certificates.................................................. 5
(d) MJA Officer's Certificate................................................... 6
(e) Opinion Of Stockholders' Counsel............................................ 6
(f) Other Necessary Instruments................................................. 6
Section 2.3 Westower's Closing Documents: Deliveries to Stockholders.................. 6
(a) Stock Certificates.......................................................... 6
(b) Westower's Certificate...................................................... 6
(c) Opinion of Westower's Counsel............................................... 7
(d) Resolutions Authorizing Transaction......................................... 7
(e) Other Necessary Instruments................................................. 7
ARTICLE III REPRESENTATIONS AND WARRANTIES OF XXXXXXX X. XXXXXXXX, XXXX XXXXXXXX, III,
AND MJA................................................................................... 7
Section 3.1 Organization and Authority of MJA......................................... 7
Section 3.2 Power and Authority; Enforceability; No Violation......................... 7
Section 3.3 No Subsidiaries, Partnerships and Joint Ventures.......................... 8
Section 3.4 Financial Statements...................................................... 8
Section 3.5 No Undisclosed Liabilities................................................ 8
Section 3.6 No Dealings with Officers, Directors, Affiliates, or Stockholders of MJA.. 9
Section 3.7 Taxes..................................................................... 9
Section 3.8 Contracts................................................................. 11
Section 3.9 Facts Giving Rise to Possible Claims/Litigation........................... 11
Section 3.10 Customers and Suppliers.................................................. 11
Section 3.11 Accounts Receivable...................................................... 12
Section 3.12 Corporate Books and Records.............................................. 12
Section 3.13 Title to Properties...................................................... 12
Section 3.14 Conflicts with Laws; Other Instruments................................... 13
Section 3.15 Governmental Authorizations.............................................. 13
Section 3.16 Claims, Administrative Actions, and Lawsuits............................. 13
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Section 3.17 Leases; No Unowned Assets Utilized....................................... 14
Section 3.18 Insurance................................................................ 14
Section 3.19 Pooling of Interests..................................................... 15
Section 3.20 Absence of Certain Changes or Events..................................... 15
Section 3.21 Real Property: Business Locations........................................ 16
Section 3.22 Environmental Liabilities................................................ 17
Section 3.23 Absence of Questionable Payments......................................... 18
Section 3.24 MJA's Employees.......................................................... 19
Section 3.25 WARN..................................................................... 19
Section 3.26 Compliance with Laws..................................................... 20
Section 3.28 Employee Benefit Plans................................................... 20
(a) Benefit Plans............................................................... 20
(b) Pension and Welfare Benefit Plans........................................... 20
(c) Withdrawal Liability........................................................ 21
(d) No Prohibited Transactions.................................................. 21
(e) No PBGC Liability........................................................... 21
(f) Full Payment to Plans....................................................... 22
(g) Plans In Compliance with Laws............................................... 22
Section 3.29 Employee List............................................................ 22
Section 3.30 Full Disclosure.......................................................... 22
ARTICLE IV REPRESENTATIONS AND WARRANTIES OF STOCKHOLDERS.................................. 23
Section 4.1 Stock of MJA.............................................................. 23
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Section 4.2 Ownership of MJA Stock.................................................... 23
Section 4.3 Stockholders' Broker...................................................... 23
Section 4.4 Investment Intent: Resale of Westower Shares.............................. 24
Section 4.5 No Current Registration of Westower Shares................................ 24
Section 4.6 Information Related to Westower Shares.................................... 24
Section 4.7 Knowledgeable............................................................. 24
ARTICLE V REPRESENTATIONS AND WARRANTS OF WESTOWER......................................... 25
Section 5.1 Westower's Organization and Authority..................................... 25
Section 5.2 Westower's Compliance with Other Instruments.............................. 25
Section 5.3 Westower's Broker......................................................... 26
Section 5.4 Westower Shares........................................................... 26
Section 5.5 Filings with the SEC...................................................... 26
Section 5.6 Subsequent Events: Investment Information................................ 26
Section 5.7 Financial Statements...................................................... 27
Section 5.8 No Undisclosed Liabilities................................................ 27
Section 5.9 Taxes..................................................................... 27
Section 5.10 Accounts Receivable...................................................... 27
Section 5.11 Conflicts with Laws; Other Instruments................................... 27
Section 5.12 Governmental Authorizations.............................................. 28
Section 5.13 Claims, Administrative Actions, and Lawsuits............................. 28
Section 5.14 Insurance................................................................ 29
Section 5.15 Pooling of Interests..................................................... 29
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Section 5.16 Absence of Certain Changes or Events..................................... 29
Section 5.17 Environmental Liabilities................................................ 31
Section 5.18 Absence of Questionable Payments......................................... 32
Section 5.19 Compliance with Laws..................................................... 32
Section 5.20 Employee Benefit Plans................................................... 33
Employee Benefit Plans................................................................ 33
(a) Benefit Plans............................................................... 33
(b) Pension and Welfare Benefit Plans........................................... 33
(c) Withdrawal Liability........................................................ 33
(d) No Prohibited Transactions.................................................. 33
(e) No PBGC Liability........................................................... 34
(f) Full Payment to Plans....................................................... 34
(g) Plans In Compliance with Laws............................................... 34
Section 5.21 Blackout Period in Section 6.12.......................................... 35
Section 5.22 Full Disclosure.......................................................... 35
ARTICLE VI COVENANTS OF STOCKHOLDERS....................................................... 35
Section 6.1 Access to Plant and Records............................................... 35
Section 6.2 Ordinary Course of Business............................................... 35
Section 6.3 Maintenance of Property................................................... 36
Section 6.4 No New Material Agreements................................................ 36
Section 6.5 Compensation.............................................................. 36
Section 6.6 Indebtedness.............................................................. 36
Section 6.7 No Securities Issued...................................................... 37
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Section 6.8 Repurchase; Dividends..................................................... 37
Section 6.9 Termination Of Stockholders Agreement..................................... 37
Section 6.10 Cooperation.............................................................. 37
Section 6.11 Registration Required Prior To Sale of Westower Shares................... 37
Section 6.12 Blackout Period.......................................................... 38
Section 6.13 Share Exchange........................................................... 38
Section 6.14 Election to Close Books.................................................. 39
Section 6.15 Transfer of Permits...................................................... 39
ARTICLE VII COVENANTS OF WESTOWER.......................................................... 39
Section 7.1 Confidentiality........................................................... 39
Section 7.2 Westower's Cooperation.................................................... 40
Section 7.3 Registration and Listing of the Westower Shares........................... 40
Section 7.4 Tax Matters............................................................... 41
Section 7.5 Election to Close Books................................................... 41
ARTICLE VIII CONDITIONS PRECEDENT TO STOCKHOLDERS' OBLIGATIONS............................. 41
Section 8.1 Westower's Representations and Warranties................................. 42
Section 8.2 Westower's Delivery of Documents.......................................... 42
Section 8.3 Stockholder Approval...................................................... 42
Section 8.4 Other Approvals........................................................... 42
Section 8.5 No Litigation............................................................. 42
Section 8.6 Waivers and Consents Obtained............................................. 42
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ARTICLE IX CONDITIONS PRECEDENT TO WESTOWER'S OBLIGATIONS.................................. 43
Section 9.1 Representations and Warranties............................................ 43
Section 9.2 Lease Agreement........................................................... 43
Section 9.3 Stockholders' Delivery of Documents....................................... 43
Section 9.4 Other Approvals........................................................... 43
Section 9.5 No Litigation............................................................. 44
Section 9.6 Waivers and Consents Obtained............................................. 44
Section 9.7 Stockholder Approval...................................................... 44
Section 9.8 Affiliate Letter; Pooling of Interests.................................... 44
ARTICLE X INDEMNIFICATION.................................................................. 44
Section 10.1 Indemnification by Stockholders.......................................... 44
Section 10.2 Notice of Asserted Claims by Third Parties............................... 45
Section 10.3 Investigations; Waivers.................................................. 46
ARTICLE XI TERMINATION; WAIVER AND AMENDMENT............................................... 46
Section 11.1 Termination.............................................................. 46
Section 11.2 Waiver and Amendment..................................................... 47
ARTICLE XII MISCELLANEOUS.................................................................. 47
Section 12.1 Expenses................................................................. 47
Section 12.2 Compliance with Securities Laws.......................................... 48
Section 12.3 Exhibits Incorporated by Reference....................................... 48
Section 12.4 Notices.................................................................. 48
Section 12.5 Counterparts............................................................. 50
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Section 12.6 Party in Interest........................................................ 50
Section 12.7 Entire Agreement; Writing Required to Amend.............................. 50
Section 12.8 Partial Invalidity....................................................... 50
Section 12.9 Headings................................................................. 50
Section 12.10 Precedence of Documents................................................. 50
Section 12.11 Choice of Law; Forum Selection.......................................... 51
Section 12.12 Enforcement Cost........................................................ 51
Section 12.13 Equitable Remedies...................................................... 51
Section 12.14 Stockholder Access to Books and Records................................. 51
Section 12.15 Joint Approval of Press Release......................................... 52
Section 12.16 Survival................................................................ 52
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LIST OF EXHIBITS
MJA/STOCKHOLDER'S EXHIBITS WESTOWER EXHIBITS
-----------------------------------------------------------
Exhibit 3.1 Exhibit 2.3(b)
Exhibit 3.4 Exhibit 2.3(c)
Exhibit 3.6 Exhibit 5.7
Exhibit 3.7(a)
Exhibit 3.7(c)
Exhibit 3.8(a)
Exhibit 3.10(b)
Exhibit 3.13
Exhibit 3.14
Exhibit 3.15
Exhibit 3.16
Exhibit 3.17
Exhibit 3.18 - Where is it?
Exhibit 3.20
Exhibit 3.21
Exhibit 3.22
Exhibit 3.26
Exhibit 3.27
Exhibit 3.28 - Where is it?
Exhibit 3.29 - Where is it?
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SHARE EXCHANGE AGREEMENT
This Share Exchange Agreement ("Agreement") is entered as of the 29th day
of May 1998 by XXXXXXX X. XXXXXXXX, XXXXXXXXX X. XXXXXXXX and XXXX XXXXXXXX, III
(collectively the "Stockholders" and any of them individually a "Stockholder"),
MJA COMMUNICATIONS CORP., a Florida corporation ("MJA"), and WESTOWER
CORPORATION, a Washington corporation ("Westower").
RECITALS
X. Xxxxxxxx wishes to acquire from Stockholders, on the terms and
conditions set forth in this Agreement, all of the issued and outstanding shares
of MJA.
B. The Stockholders are the owners of 100 shares of $1 par value, common
stock of MJA (the "MJA Stock").
C. The MJA Stock represents all of the issued and outstanding capital
stock of MJA; and the Stockholders desire to exchange the MJA Stock for common
stock of Westower (each share of such stock being a "Westower Share") so as to
accomplish and effect a share exchange under the Business Corporation Act of the
State of Washington.
D. It is the intent of the parties that the transaction qualify as a
corporate reorganization under Section 368(a)(1)(B) of the Internal Revenue Code
of 1986, as amended (the "Code") and as a "pooling of interests" for financial
accounting purposes.
AGREEMENTS
NOW, THEREFORE, in consideration of the foregoing recitals and of the
mutual agreements contained herein, Stockholders and Westower hereby agree as
follows:
ARTICLE I
SHARE EXCHANGE
SECTION 1.1 EXCHANGE OF MJA STOCK
Subject to the terms and conditions of this Agreement at the Effective Time
(as defined below) all the issued and outstanding shares of MJA Stock held of
record by
the Stockholders in the number and type set forth below opposite the name of
each Stockholder, shall be automatically exchanged for the right to receive at
least an aggregate of 384,616 Westower Shares as set forth below opposite the
name of each Stockholder (the "Share Exchange") plus the additional Westower
Shares as set forth in Section 1.2 below. Upon the effectiveness of the Share
Exchange, Westower shall be deemed to be the holder of record of all the issued
and outstanding shares of MJA Stock, and MJA shall continue to be governed by
the laws of the State of Florida.
NUMBER OF TYPE OF SHARES MINIMUM
NAME OF STOCKHOLDER OF MJA STOCK NUMBER OF WESTOWER SHARES
---------------------------------------------------------------------------------------
Xxxxxxx X. Xxxxxxxx and 85 326,923
Xxxxxxxxx X. Xxxxxxxx
Xxxx Xxxxxxxx, III 15 57,693
Total Shares: 100 384,616
SECTION 1.2 INCREASE IN NUMBER OF WESTOWER SHARES ISSUED TO STOCKHOLDERS
If at the Closing (as defined below) the closing price on the preceding day
for the Westower Shares, as reported in the Wall Street Journal, is less than
Twenty-Six U.S. Dollars ($26.00) per share, then additional Westower Shares
shall be issued within 15 calendar days to the Stockholders pro rata with their
ownership of MJA shares so that the aggregate value of the Westower Shares
issued in exchange for the MJA Stock equals Ten Million U.S. Dollars
($10,000,000.00) valued at the closing price for Westower Shares on the day
preceding the Closing. If, however, at Closing, the closing price on the
preceding day for the Westower Shares, as reported in the Wall Street Journal,
is more than Twenty-Six U.S. Dollars ($26.00) per share, then no additional
Westower Shares shall be issued beyond the 384,616 Westower Shares set forth in
Section 1.1. above.
The Stockholders and Westower agree that on May 29, 1998--that date this
transaction closed--the Wall Street Journal reported a closing price for
Westower common stock of 25 3/16. As a result, the Westower Shares which
Stockholders are entitled, collectively, pursuant to this Section 1.2 to receive
an aggregate of 397,023 shares, of which Westower will cause the transfer agent
for its shares to issue the following: 337,470 to Xxxxxxx X. Xxxxxxxx and
Xxxxxxxxx X. Xxxxxxxx and 59,553 to Xxxx Xxxxxxxx, III. Westower shall request
that the transfer agent issue the stock with
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the restrictions set forth in this Agreement and deliver the shares by overnight
courier to the respective counsel for the Stockholders set forth in Section
12.4.
SECTION 1.3 ARTICLES OF SHARE EXCHANGE
The parties hereto agree that the Share Exchange contemplated pursuant to
Section 1.1 shall be effectuated, at the Effective Time (as such term is
hereinafter defined), pursuant to articles of share exchange ("Articles of Share
Exchange") in accordance with applicable provisions of the Washington Business
Corporation Act. Such Articles of Share Exchange shall be filed with Secretary
of State of the State of Washington together with any other filings and
recordings required by Washington law in connection with the Share Exchange as
soon as practicable after the Closing. The term Effective Time, as used herein,
means the time at which the Share Exchange becomes effective under the laws of
the State of Washington.
SECTION 1.4 EXCHANGE RATIO
At the Effective Time, each share of MJA Stock issued and outstanding
immediately prior to the Effective Time shall, by virtue of the Share Exchange
and without any action on the part of the holders thereof, automatically be
exchanged for the number of shares of Westower Shares equal to the number
obtained by dividing 384,616 by 100. Each certificate evidencing ownership of
MJA Stock outstanding immediately prior to the Effective Time shall, immediately
after the Effective Time, be exchanged for a certificate or certificates
evidencing ownership of the applicable number of Westower Shares.
SECTION 1.5 ADJUSTMENT FOR CHANGES
Attached hereto as Exhibit 3.4 is a balance sheet of MJA which has been
prepared by MJA and dated as of April 30, 1998 ("April 30 Balance Sheet") which
reflects the financial position of MJA as of such date. MJA will prepare, in
accordance with U.S. generally accepted accounting principles (GAAP) applied on
a basis consistent with MJA's past practice, and deliver to Westower a balance
sheet (the "Closing Date Balance Sheet") as of the Closing Date. The Closing
Date Balance Sheet shall reflect changes in the financial position between April
30, 1998 and the Closing Date. The equity of the Stockholders shown on the
Closing Date Balance Sheet will not have decreased by more than Two Hundred
Thousand Dollars (U.S.$200,000). This calculation will exclude the effects on
the MJA's balance sheet, prepared in accordance with U.S. generally accepted
accounting principles (GAAP) applied on a basis consistent with MJA's past
practice, caused by the following allowed transactions of MJA: (1) the
$1,500,000 distribution by MJA to Stockholders
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and (2) an aggregate of $250,000 in reasonable professional fees relating to the
transactions with Westower as of the Closing Date. If, after considering the
effect of these two allowed transactions, the decrease in the equity of the
Stockholders reflected on MJA's balance sheet as of the Closing Date is more
than $200,000, then the number of the Westower Shares distributed pro rata to
the Stockholders will be reduced by the amount of such decrease in excess of
$200,000 divided by U.S.$26.
SECTION 1.6 POWER OF ATTORNEY
The undersigned Stockholder of MJA is entering into this Agreement
pursuant to which his or her shares of MJA Stock will be exchanged for Westower
Shares,, and pursuant to which each Stockholder has agreed to indemnify Westower
against certain Damages (as defined in Section 10.1 hereof) in accordance with
the terms and procedures set forth in Article X hereof. In connection with the
foregoing, the undersigned Stockholder hereby irrevocably constitutes and
appoints Xxxxxxx X. Xxxxxxxx as attorney-in-fact (the "Attorney") of the
undersigned Stockholder, with Xxxx Xxxxxxxx, III to serve as the Attorney in the
event of the death or legal incapacitation of Xxxxxxx X. Xxxxxxxx, with full
power and authority of the Attorney to act, including full power of
substitution, in the name of and for and on behalf of the undersigned
Stockholder with respect to all matters arising after the date hereof in
connection with this Agreement and the indemnification of Westower, including,
but not limited to, the power and authority to take any and all of the following
actions:
(a) In connection with the indemnification of Westower, to accept on
behalf of the undersigned Stockholder notice from Westower of any claim with
regard to which Westower is entitled to indemnification pursuant to Section 10.1
hereof, to agree on behalf of the undersigned Stockholder to defend against such
claim, to retain legal counsel in connection with any and all matters relating
to such claim, to communicate with Westower and to agree with Westower on behalf
of the undersigned Stockholder to the resolution or settlement of such claim, to
agree to the amount of such indemnification payable by the Stockholders and to
agree to the proration of the indemnification amount among the Stockholders,
including the undersigned Stockholder; and
(b) To make, exchange, acknowledge and deliver all such orders,
receipts, notices, requests, instructions, certificates, letters, contracts and
other writings required by this Agreement after the date hereof, and in general
to do all things and take all actions that the Attorney, in his discretion,
deems necessary or proper in connection with this Agreement and the
indemnification of Westower as fully as could the undersigned Stockholder if
personally present and acting.
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The power of attorney granted hereby (i) is a special power of attorney coupled
with an interest and is irrevocable and (ii) shall survive the delivery of an
assignment or other transfer by the undersigned Stockholder of the whole or a
portion of his or her interest in the Westower Stock.
The undersigned Stockholder hereby agrees that the Attorney shall have no
liability to the undersigned Stockholder for any actions taken in good faith by
the Attorney on behalf of the undersigned Stockholder with respect to or
pursuant to the power of attorney granted under this Section 1.6.
ARTICLE II
CLOSING AND CLOSING DOCUMENTS
SECTION 2.1 DATE, TIME AND PLACE OF CLOSING
The sale of the MJA Stock contemplated hereunder shall take place at a
closing (the "Closing") to be held at 11:00 a.m. Pacific time on May 29, 1998,
as the parties may agree, at the offices of Westower located at 2653 151 Place
NE, Redmond, Washington, or at the offices of Xxxxxxx Coie LLP located at 0000
Xxxxx Xxxxxx, Xxxxxxx, Xxxxxxxxxx. The date on which the Closing occurs is
herein referred to as the Closing Date. All documents required to be delivered
or actions to be taken at the Closing shall be delivered or performed
simultaneously, and no delivery shall be considered to have been made and no
action shall be considered to have been performed until all such deliveries or
actions have been completed. As used herein, the term "Closing Documents" shall
refer to all or any of the documents and certificates enumerated in Section 2.2
and Section 2.3 below.
SECTION 2.2 STOCKHOLDERS' CLOSING DOCUMENTS; DELIVERIES TO WESTOWER
At the Closing, Stockholders shall deliver or cause to be delivered to
Westower the following documents (collectively, the "Stockholders' Closing
Documents"):
(a) STOCK CERTIFICATES
Certificates, executed in blank by the Stockholders, or certificates
accompanied by assignment separate from certificate executed by each of the
Stockholders representing all of the MJA Stock;
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(b) MJA GOOD STANDING CERTIFICATES
Certificates, issued by the Secretary of State of Florida, Georgia, North
Carolina and South Carolina indicating that MJA is qualified and in good
standing within such jurisdictions;
(c) STOCKHOLDERS' CERTIFICATES
A certificate signed by each of the Stockholders dated as of the Closing
Date in a form attached hereto as Exhibit 2.2(c). Such certificate, if and when
delivered, shall for all purposes of this Agreement constitute an additional
representation and warranty of the Stockholders to the same extent as if made in
this Agreement;
(d) MJA OFFICER'S CERTIFICATE
A certificate signed by an authorized officer of MJA dated as of the
Closing Date in a form attached hereto as Exhibit 2.2(d);
(e) OPINION OF STOCKHOLDERS' COUNSEL
An opinion or opinions of Gunster, Yoakley, Xxxxxx-Xxxxx & Xxxxxxx, P.A.
counsel for the Stockholders, dated as of the Closing Date, as to the matters
described in and in the form attached hereto as Exhibit 2.2(e); and
(f) OTHER NECESSARY INSTRUMENTS
Such other instruments as may be necessary or advisable and reasonably
required to effect the purposes hereof
SECTION 2.3 WESTOWER'S CLOSING DOCUMENTS: DELIVERIES TO STOCKHOLDERS
At the Closing, Westower shall deliver or cause to be delivered to
Stockholders the following documents (collectively, the Westower's Closing
Documents):
(a) STOCK CERTIFICATES
One or more Stock Certificates in the names of each of the Stockholders
representing Westower Shares to be delivered by Westower to each such
Stockholder pursuant to Section 1.1 above;
The manner of delivery will be dispatch by Westower's counsel of facsimiles
to Westower's transfer agent requesting that the Westower Shares in the amounts
set
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forth in Section 1.2 be delivered by overnight courier to the respective counsel
for the Stockholders set forth in Section 12.4;
(b) WESTOWER'S CERTIFICATE
A certificate dated as of the Closing Date in a form attached hereto as
Exhibit 2.3(b) signed by an authorized officer or representative of Westower.
Such certificate, if and when delivered, shall for all purposes of this
Agreement constitute an additional representation and warranty of Westower to
the same extent as if made in this Agreement;
(c) OPINION OF WESTOWER'S COUNSEL
An opinion or opinions of Xxxxxxx Coie LLP, counsel for Westower, dated as
of the Closing Date, as to the matters described in and in the form attached
hereto as Exhibit 2.3(c);
(d) RESOLUTIONS AUTHORIZING TRANSACTION
A certificate dated as of the Closing Date signed by the Secretary of
Westower evidencing all resolutions adopted by the Board of Directors of
Westower authorizing the transactions contemplated by this Agreement;
(e) OTHER NECESSARY INSTRUMENTS
Such other instruments as may be necessary or advisable and reasonably
required to effect the purposes hereof.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF
XXXXXXX X. XXXXXXXX, XXXX XXXXXXXX, III, AND MJA
Xxxxxxx X. Xxxxxxxx, Xxxx Xxxxxxxx, III, and MJA, to the best of their
knowledge formed after investigation and due diligence, represent and warrant,
jointly and severally, to Westower as follows:
SECTION 3.1 ORGANIZATION AND AUTHORITY OF MJA
MJA is a corporation duly incorporated, validly existing and its status is
active under the laws of the State of Florida and has all requisite power and
authority (corporate and other) to own, operate and lease its properties and
assets and to carry on its businesses in the same manner as such businesses are
now being conducted.
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MJA is qualified, and licensed as a foreign corporation, to do business in each
of the states listed on Exhibit 3.1, hereof, and, except as disclosed to
Westower, is in good standing in each of such states.
SECTION 3.2 POWER AND AUTHORITY; ENFORCEABILITY; NO VIOLATION
With respect to his or herself only, each Stockholder has full power and
authority to execute, deliver and perform his or her obligations under this
Agreement, and to consummate the transactions contemplated hereby. All actions
on the part of MJA and its respective officers, directors and shareholders
necessary for the authorization, execution, delivery and performance of this
Agreement and the consummation of the transactions contemplated hereby have been
taken. Assuming due authorization, execution, and delivery by Westower, this
Agreement has been duly executed and delivered by each Stockholder and
constitutes a legal, valid and binding obligation of such Stockholder,
enforceable against him or her in accordance with its terms, subject, as to
enforceability, to bankruptcy and equitable principles.
SECTION 3.3 NO SUBSIDIARIES, PARTNERSHIPS AND JOINT VENTURES
MJA owns no interest in any joint venture, other partnership, or in any
Subsidiary. The term "Subsidiary" as used in the preceding sentence shall mean:
(a) any corporation more than 40% of whose shares of stock having general voting
power under ordinary circumstances to elect a majority of the board of
directors, managers or trustees of such corporation, irrespective of whether or
not at the time stock of any other class or classes shall have or might have
voting power by reason of the happening of any contingency, are owned or
controlled directly or indirectly by MJA, or (b) any partnership 50% or more of
the partnership interests of which are owned or controlled, directly or
indirectly, by MJA.
SECTION 3.4 FINANCIAL STATEMENTS
Attached hereto as Exhibit 3.4 is a balance sheet of MJA dated as of April
30, 1998 ("April 30th Balance Sheet"). The Stockholders have heretofore
delivered to Westower accurate and complete copies of the balance sheet of MJA
at December 31 in each of 1996 and 1997, and the related statements of
operations and changes in financial position of MJA for each of the years then
ended (collectively, the "MJA Audited Financial Statements"). The December 31st
Balance Sheet and each of the MJA Audited Financial Statements present fairly,
in all material respects, the financial position of MJA at the respective dates
thereof, and the results of MJA' operations and changes in financial position,
for the periods indicated, all in conformity with GAAP. The April 30th Balance
Sheet presents fairly, in all material respects, the financial
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position of MJA at April 30, 1998, consistent with the past accounting and
business practices of MJA.
SECTION 3.5 NO UNDISCLOSED LIABILITIES
Except as disclosed on Exhibit 3.4 hereof, as of December 31, 1997 and as
of April 30, 1998 MJA had no known material liabilities or obligations of any
nature, whether absolute, accrued contingent or otherwise and whether due or to
become due, that were not reflected on the December 31st Balance Sheet, the
April 30th Balance Sheet or the MJA Audited Financial Statements, or in the
notes thereto, respectively (except those incurred by MJA in the ordinary course
of business thereafter or which are of a type not ordinarily reflected on a
balance sheet prepared in accordance with GAAP), and none of the Stockholders
knows nor does MJA know of any basis for assertion against MJA of any such
liability.
SECTION 3.6 NO DEALINGS WITH OFFICERS, DIRECTORS, AFFILIATES, OR STOCKHOLDERS
OF MJA
Except for the contractual agreements as listed on Exhibit 3.6 attached
hereto, as of the date of this Agreement, MJA does not have, directly or
indirectly, any contractual arrangements (including any express written
employment agreements) with any of its affiliates, stockholders, officers or
directors. Without limiting the generality of the foregoing sentence, as of the
date of this Agreement and as of the Closing Date, no affiliates, stockholder,
officer, director or employee of MJA is, directly or indirectly, under
circumstances which individually or in the aggregate are material to the
business of MJA, a joint investor or venturer with, or owner, lessor, lessee,
licenser or licensee of any real or personal property, tangible or intangible,
owned or used by, MJA or was or is a lender to or debtor of MJA.
SECTION 3.7 TAXES
(a) MJA has filed all Tax Returns that it was required to file. All
such Tax Returns were correct and complete in all respects. All Taxes owed by
MJA (whether or not shown on any Tax Return) have been paid or properly accrued.
Except as set forth on Exhibit 3.7(a), MJA is not currently the beneficiary of
any extension of time within which to file any Tax Return. No claim has ever
been made by an authority in a jurisdiction where MJA does not file Tax Returns
that it is or may be subject to taxation by that jurisdiction. There are no
liens on any of the assets of MJA that arose in connection with any failure (or
alleged failure) to pay any Tax.
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(b) MJA has withheld and paid all Taxes required to have been
withheld and paid in connection with amounts paid or owing to any employee,
independent contractor, creditor, stockholder, or other third party.
(c) There is no dispute or claim concerning any Tax Liability of MJA
either (A) claimed or raised by any authority in writing or (B) as to which any
of the Stockholders and the directors and officers (and employees responsible
for Tax matters) of MJA has knowledge based upon personal contact with any agent
of such authority. Exhibit 3.7(c) lists all Tax Returns filed with respect to
MJA that have been audited, and indicates those Tax Returns that currently are
the subject of audit. The Stockholders have delivered to the Buyer correct and
complete copies of all federal income Tax Returns, examination reports, and
statements of deficiencies assessed against or agreed to by MJA since December
31, 1995.
(d) MJA has not waived any statute of limitations in respect of Taxes
or agreed to any extension of time with respect to a Tax assessment or
deficiency.
(e) MJA has not filed a consent under Code section 341(f) concerning
collapsible corporations. MJA has not made any payments, is not obligated to
make any payments, and is not a party to any agreement that under certain
circumstances could obligate it to make any payments that will not be deductible
under Code section 280G. MJA has not been a United States real property holding
corporation within the meaning of Code section 897(c)(2) during the applicable
period specified in Code section 897(c)(1)(A)(ii). MJA is not a party to any
Tax allocation or sharing agreement. MJA (i) has not been a member of an
affiliated group filing a consolidated federal income Tax Return or (ii) has no
liability for the Taxes of any person under section 1.1502-6 of the treasury
regulations (or any similar provision of state, local, or foreign law), as a
transferee or successor, by contract, or otherwise.
(f) The unpaid Taxes of MJA (i) did not, as of April 30, 1998, exceed
the reserve for Tax liability (rather than any reserve for deferred Taxes
established to reflect timing differences between book and Tax income) set forth
on the face of the April 30, 1998 Balance Sheet (rather than in any notes
thereto), and (ii) do not exceed that reserve as adjusted for the passage of
time through the Closing Date in accordance with the past custom and practice of
MJA in filing their Tax Returns.
(g) MJA has made a valid election to be treated as an S corporation
within the meaning of Section 1361 of the Code ("S Corporation"), and such
election has been in effect for each of MJA's taxable years commencing from
incorporation and ending on or before the Closing Date. MJA has qualified and
will qualify as an
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X Xxxxxxxxxxx at all times from election up to and including the Closing Date.
MJA has not been and will not be subject to any Taxes pursuant to Section
1363(d) or Section 1374 of the Code at any time up to and including the Closing
Date.
(h) "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, capital stock, franchise, profits, withholding, social
security (or similar), unemployment, disability, real property, personal
property, sales, use, transfer, registration, value added, alternative or add-on
minimum, estimated, or other tax of any kind whatsoever, including any interest,
penalty, or addition thereto, whether disputed or not.
(i) "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.
SECTION 3.8 CONTRACTS
Exhibit 3.8(a) contains a true and complete list of all contracts,
agreements, arrangements and understandings, or written, to which MJA is a party
or by which MJA is bound which (1) could result in an obligation of more than
$50,000 to MJA or which could result in receipt of more than $50,000 by MJA or
(2) are between MJA and an entity controlled by Xxxxxxx X. Xxxxxxxx, including,
without limitation, all guaranties, promissory notes and security agreements,
license agreements, purchase and supply agreements, and agreements relating to
the borrowing of money. To MJA's Knowledge, except as set forth in such Schedule
3.8(a), all such contracts are valid, binding and enforceable in accordance with
their terms against each party thereto and are in full force and effect; MJA has
performed in all material respects all obligations imposed on it thereunder;
and, other than payment defaults by MJA, to MJA's Knowledge neither MJA nor any
other party thereto is in default thereunder, nor is there any event that with
notice or lapse of time, or both, would constitute a default thereunder. True
and complete copies of each such contract entered into outside the normal course
of MJA's business have been delivered to Westower. MJA has not received notice,
nor is MJA otherwise aware, that any party to any such contract intends to
cancel, terminate or refuse to renew such contract or to exercise or decline to
exercise any option or right thereunder. Without limiting the generality of the
foregoing, (1) MJA no longer any obligation to First Union or its successor in
interest under any guaranty, line of credit, (2) MJA has not pledged collateral
to secure the obligations owed by Xxxxxxx X. Xxxxxxxx to First Union, and (3)
MJA has not entered into contracts with corporations controlled by Xxxxxxx X.
Xxxxxxxx except
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as disclosed to Westower. The term "MJA Knowledge," as used in this Agreement,
shall mean to the knowledge, formed after reasonable investigation and due
diligence, of any of the officers of MJA.
SECTION 3.9 FACTS GIVING RISE TO POSSIBLE CLAIMS/LITIGATION
To MJA's Knowledge, there are no facts that could furnish the basis for a
dispute with MJA or a claim that could be brought against MJA in litigation or
arbitration.
SECTION 3.10 CUSTOMERS AND SUPPLIERS
Exhibits 3.10(a) and 3.10(b), attached hereto, respectively, set forth (a)
a complete and accurate list of customers accounting for 2% or more of MJA's
revenues in any given fiscal year during the past two fiscal years, showing the
approximate total revenues from each such customer during such periods and (b) a
complete and accurate list of MJA's suppliers from whom MJA purchased 5% or more
of its goods or services in any given year during the past two fiscal years.
SECTION 3.11 ACCOUNTS RECEIVABLE
Except as disclosed on Exhibit 3.4, all accounts and notes receivable of
MJA reflected on the December 31st Balance Sheet are bona fide, and have arisen
in the ordinary course of business. Except as disclosed on Exhibit 3.4, the
April 30th Balance Sheet contains adequate provisions for doubtful accounts in
accordance with GAAP. Notwithstanding the foregoing, except as disclosed on
Exhibit 3.4, Stockholders do not warrant collectibility of any particular
accounts and notes receivable contained in the accounts and notes receivable
reflected on the December 31st Balance Sheet or the April 30th Balance Sheet.
SECTION 3.12 CORPORATE BOOKS AND RECORDS
MJA has furnished to Westower's representatives for their examination true
and complete copies of (a) MJA's Articles of Incorporation and Bylaws of MJA as
currently in effect, including all amendments thereto, (b) MJA's minute books,
which books are substantially complete in all material respects, and (c) MJA's
stock transfer books. Such minutes reflect all documented meetings of MJA's
shareholders and Board of Directors and any committees thereof since MJA's
inception, and accurately reflect in all material respects the events of and
actions taken at such meetings
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SECTION 3.13 TITLE TO PROPERTIES
Except as to liens disclosed in Exhibit 3.13 (the "Existing Lien") and the
Permitted Liens, MJA owns good and marketable title, free and clear of all
mortgages, liens, pledges, charges and encumbrances, to all the properties and
assets reflected on the December 31st Balance Sheet and the April 30th Balance
Sheet. The term Permitted Liens, as used herein, shall include municipal and
zoning ordinances, rights of way, mineral reservations, recorded easements, such
state of facts an accurate survey would show, building and use restrictions and
covenants, liens imposed by law, imperfections, irregularities and defects
incurred in the ordinary course of business or obligations not yet due to
carriers, warehousemen, laborers, materialmen and the like and liens for real
and personal property taxes, assessments or like governmental charges not yet
delinquent and payable without penalty.
SECTION 3.14 CONFLICTS WITH LAWS; OTHER INSTRUMENTS
Except as to matters disclosed in Exhibit 3.14, neither the execution and
delivery of this Agreement nor the consummation of the transactions contemplated
hereby nor compliance by any Stockholder or MJA with any of the provisions
hereof will: (a) to MJA's Knowledge, conflict with, or result in a breach or
contravention of, or in a default or the creation of any lien under, any of the
terms, conditions or provisions of any note, bond, mortgage indenture, license,
agreement or other instrument or obligations (including without limitation MJA'
Articles of Incorporation and By-laws) to which MJA is a party or by which it or
any of its properties or assets may be bound, except where such breach or
default will not have a material adverse effect on MJA's business or (b) violate
any order, writ, injunction or decree applicable to MJA or any of its or their
properties or assets. To MJA's Knowledge no consent, approval or other action
by any governmental authority is required in connection with the execution,
delivery and performance by the Stockholders of this Agreement. Except for the
risk of a general economic downturn or moratoria affecting MJA's business of the
types described in documents Westower has caused to be filed with the SEC, to
MJA's Knowledge, there are no changes in any regulation, ordinance, law, order
or other requirement materially affecting any property or operation of MJA or
any condemnation proceeding pending, or threatened, which will prohibit MJA from
continuing the use of any of its properties or assets or from continuing to
operate its business substantially in the manner in which it has been conducted
prior to the Closing Date.
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SECTION 3.15 GOVERNMENTAL AUTHORIZATIONS
Except as set forth on Exhibit 3.15, to MJA's Knowledge, MJA has,
consistent with good business practice, all such licenses, permits, clearances
and other authorizations from the United States federal, state and local as well
as all foreign national provincial and local, authorities as MJA deems necessary
for the conduct of its business and operations for which the failure to have
such licenses, permits, clearances, and other authorizations would have a
material adverse effect on MJA's business.
SECTION 3.16 CLAIMS, ADMINISTRATIVE ACTIONS, AND LAWSUITS
Except as disclosed in Exhibit 3.16 hereof and except as to those matters
which have been settled or otherwise resolved prior to the date hereof, MJA is
not aware of and has not been served with, any notice or claim by any
governmental agency, customer, employee or any other party whatsoever relating
to: (a) the business or operations of MJA; (b) any infringement or
misappropriation of any patent or other intellectual property right in
connection with performance of the services provided by MJA and/or any equipment
manufactured or sold by MJA; (c) any environmental claim associated with
operations of MJA or the ownership or operation of any property or properties by
MJA; (d) any claim of non-compliance by MJA under the Occupational Safety and
Health Act, any foreign safety laws or other applicable governmental safety
regulation; (e) any negligence claims or errors and omissions claims with
respect to any services performed by MJA prior to the Closing Date or any goods
or products sold by MJA prior to the Closing Date; (f) any violation of any term
or condition of any permit or license held by MJA; (g) any Workers' Compensation
statutes (other than matters as are not reportable on Form OSHA 200) and any
other applicable worker health or safety, equal employment opportunity or
discrimination, wage and hour, collective bargaining agreement, wrongful
discharge, personnel or other employment related statutes, laws or common law
rights of any type or description; or (h) any litigation of any type related in
any way to the business and operations of MJA.
SECTION 3.17 LEASES; NO UNOWNED ASSETS UTILIZED
On Exhibit 3.17 are listed the real property leases and material operating
leases of MJA. Other than the assets reflected on the December 31st Balance
Sheet and the assets that are the subject of the leases listed on Exhibit 3.17,
there are no other material assets or properties necessary or utilized in the
business and operations of MJA. To MJA's Knowledge, all of the leases disclosed
in Exhibit 3.17 hereof are in good standing and are valid and effective in
accordance with their respective terms
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and, to MJA's Knowledge, no material breach or default of MJA or by any other
party thereto exists or has been asserted with respect to any thereof, including
but not limited to a failure on the part of MJA to pay any rents that have
accrued under any such leases.
SECTION 3.18 INSURANCE
On Exhibit 3.18 hereof is a list of all policies of fire, liability, title
and other forms of insurance held by MJA and of all material claims pending
thereunder, copies of all of which have been made available to Westower. All
such policies will be in force on the Closing Date in accordance with their
respective terms, including without limitation, with respect to any insured
losses resulting from occurrences prior to the Closing Date. MJA is not in
material default with respect to any provisions of any such policy and has not
failed to give any notice or failed to present any material claim thereunder, as
to which it has knowledge, in due and timely fashion.
SECTION 3.19 POOLING OF INTERESTS
To MJA's Knowledge, there are no facts relating to MJA or Stockholders that
preclude the transactions contemplated by this Agreement from qualifying for
"pooling of interests" accounting treatment. Stockholders are not aware of any
affiliates of MJA owning shares of Westower. Stockholders do not intend to make
any disposition of the Westower shares contrary to the restrictions in the
affiliates letter described in Section 9.8.
SECTION 3.20 ABSENCE OF CERTAIN CHANGES OR EVENTS
Except as to matters disclosed in Exhibit 3.20 hereof, since December 31,
1997, as relates to MJA, there has not been:
(a) any loss, damage or destruction in the nature of a casualty loss
or otherwise, whether covered by insurance or not, of any asset or assets, the
destruction of which, taken singly or in the aggregate is material to the
business and operations of MJA;
(b) except for the risk of a general economic downturn or moratoria
affecting MJA's business of the types described in documents Westower has caused
to be filed with the SEC, to the knowledge of Stockholders, the adoption,
promulgation or rescission of any statute, regulation, order, ordinance or other
law, the adoption, promulgation or rescission of which materially and adversely
affects any of the business and operations of MJA as they are currently being
conducted;
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(c) any material failure to maintain the books and records of MJA in
the usual, regular and ordinary manner and in accordance with good business
practice and GAAP;
(d) any declaration, setting aside or payment of any dividend, or
other distribution, in respect of any capital stock of MJA or any direct or
indirect redemption, purchase or other acquisition of any capital stock of MJA
by or on behalf of MJA;
(e) any issuance or sale by MJA of any of its or their stock, bonds
or other securities;
(f) any labor controversy or the threatening of any strike, work
stoppage or slowdown materially affecting the business or assets of MJA;
(g) any sale, sale/lease back transfer, or other disposition of any
material tangible asset of MJA (material for purposes of this Section being any
transaction or agreement having a value in excess of $100,000), except in the
ordinary course of business, other than agreements relating to the purchase and
sale of inventory and/or contract equipment in the ordinary course of business
in excess of $100,000, or any sale, assignment, transfer or other disposition of
any of its material patents, trademarks, trade names, brand names, copyrights,
licenses or other intangible assets;
(h) any amendment, termination or waiver of any right of material
value belonging to MJA;
(i) any increase in the compensation payable or to become payable by
MJA to any of its or their officers, employees or agents, other than normal
merit and cost-of-living increases in accordance with the general prevailing
practices of MJA existing prior to the date of this Agreement;
(j) any changes with respect to MJA's ordinary and customary
practices with respect to the invoicing of customers, the collection of any of
the accounts receivable, and payment of any accounts payable; or
(k) except for the risk of a general economic downturn or moratoria
affecting MJA's business of the types described in documents Westower has caused
to be filed with the SEC, any material change in the nature of the business of
MJA.
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SECTION 3.21 REAL PROPERTY: BUSINESS LOCATIONS
Except as to the properties at the locations disclosed on Exhibit 3.21
hereof, MJA own no real property. All of the offices, manufacturing facilities
and/or warehouse facilities, (collectively, the "MJA Facilities" and any of them
singly a "MJA Facility") maintained or utilized by MJA, whether owned, rented or
occupied, in the conduct of any of their businesses are and on the Closing Date
will be located on the owned properties described on Exhibit 3.21 hereof or on
the leased properties described on Exhibit 3.17 hereof. MJA has not, and to
MJA's Knowledge the owner of any of the MJA Facilities has not, heretofore
received any notice of any pending condemnation or similar proceeding or charge
affecting the MJA Facilities or any portion thereof, is not aware that any such
proceeding or charge is contemplated; and, except as listed on Exhibit 3.21
hereto, has not received any notice of a proposed increase in assessed valuation
of any of the MJA Facilities. To MJA's Knowledge: (a) the existing water,
sewer, gas and electricity lines, storm sewer and other utility systems on any
of the MJA Facilities as of the date hereof are adequate to serve the utility
needs of such facilities for the business purposes presently conducted thereon;
(b) there are no material structural defects in any of the buildings or other
improvements related to any of the MJA Facilities; (c) the heating, electrical,
plumbing and drainage at, or servicing each of the MJA Facilities and all
facilities and equipment relating thereto are in working order; (d) MJA has
received no notice that a default exists or breach exists and, to MJA's
Knowledge, no default or breach exists under any of the covenants, conditions,
restrictions, rights-of-way or easements affecting any real property associated
with any of the MJA Facilities or any portion of any such facilities; and (e) no
fact or condition exists which would result in the termination of the current
access from any of the MJA Facilities to any presently existing highways and
roads adjoining or situated on any such facilities
SECTION 3.22 ENVIRONMENTAL LIABILITIES
Except as disclosed on Exhibit 3.22 hereof or as may be determined or
disclosed to Westower in the work performed for Westower in connection with this
Agreement, to MJA's Knowledge, in the operation of the business of MJA prior to
the Closing Date, including but not limited to the ownership or operation of any
real properties, MJA: (a) is not aware that it is in violation of any existing
common law or any federal foreign, state or local laws, regulations, statutes or
ordinances relating to personal injury arising out of Hazardous Substances (as
such term is hereinafter defined) or protection of the environment
(collectively, the "Environmental Laws"); (b) possesses all of the material
permits, licenses, approvals and identification numbers required under any
Environmental Laws for the operation of each of the
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MJA Facilities in the manner in which any such facility is presently operated,
all of which permits, licenses, approvals and identification numbers are
described on Exhibit 3.19 hereof; (c) is in compliance in all material respects
with all permits, licenses and approvals required by any of the Environmental
Laws for the operation of each of MJA Facilities in the manner in which each
such facility is currently being operate, except for such non-compliance as
would not be reasonably expected to lead to imposition of penalties or similar
sanctions by regulatory agencies; (d) is not aware of any conditions that will
affect the continued validity after the Closing Date of all such permits,
licenses and approvals required by any Environmental Laws for the operation of
any of the MJA Facilities in the manner in which it is currently being operated;
(e) is not aware of the existence of any pending or threatened suits,
proceedings, investigations or claims with respect to sites of, or the
operations conducted at any of the MJA Facilities relating to the enforcement of
any Environmental Laws or to determine the existence of any environmental
liabilities; (f) is not aware of the existence of any pending or threatened
suits, proceedings or claims by any third parties for damages or injunctive
relief arising out of the presence of any emissions, discharges, releases or
threatened releases, storage, transportation or the handling of pollutants,
contaminants, regulated wastes or hazardous wastes (collectively, the Hazardous
Substances) on or off the sites of any of MJA Facilities allegedly caused,
directly or indirectly, by the operations of MJA at any such facility; (g) is
not aware of the existence of any citizen complaint relating to the site of any
of the MJA Facilities or the operations of MJA at any such facility; (h) other
than normal wear and tear on equipment that may alter its performance, is not
aware of any existing circumstances that may interfere with the continued
compliance with any existing permit, license or approval required by statute or
regulations for the operation of any of the MJA Facilities in the manner in
which it is presently operated, except for such non-compliance as would not be
reasonably expected to lead to imposition of penalties or similar sanctions by
regulatory agencies; (i) is not aware of the occurrence of any spill discharge,
deposit or other release of any Hazardous Substances, in excess of reportable
quantities under Federal or state environmental laws and which has led or is
likely to lead to enforcement actions by governmental agencies, at any of the
MJA Facilities caused, directly or indirectly, by MJA; (j) is not aware of any
asbestos conditions at any of the MJA Facilities; (k) is not aware of any
transformers, fixtures or other electrical equipment containing PCB's installed
in, affixed to or located at any of the MJA Facilities; (l) is not aware of any
storage tanks, in excess of 250 gallons, for petroleum or hazardous substances
located at any of the MJA Facilities, whether above ground, underground or
within a structure; (m) is not aware of any current or prior use of the premises
of the MJA Facilities which would give rise to liability under any Environmental
Laws; and (a) is not aware of any potential liability under any Environmental
Laws arising out of any pre-Closing utilization of or operations at any
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of the MJA Facilities by MJA or other third parties and has not been placed on
notice of any claim of any governmental agency or other regulatory body claiming
violation of any Environmental Laws or requiring any remediation or cleanup with
respect to any of the MJA Facilities or requiring any change in the means or
methods of operation of any such facility.
SECTION 3.23 ABSENCE OF QUESTIONABLE PAYMENTS
To MJA's Knowledge, neither MJA nor any of its directors, officers, agents,
employees or any other Person acting on behalf of MJA has used any of MJA's
funds for improper or unlawful contributions, payments, gifts or entertainment,
or made any unlawful expenditures relating to political activity to governmental
officials or others. Neither MJA nor any of its current directors, officers,
agents, employees or any other Person acting on behalf of MJA has accepted or
received any improper or unlawful contributions, payments, gifts or
expenditures. MJA has at all times complied, and is in compliance, in all
material respects with the applicable provisions of the U.S. Foreign Corrupt
Practices Act, as amended, and other applicable domestic and foreign laws and
regulations relating to corrupt practices and similar matters.
SECTION 3.24 MJA'S EMPLOYEES
Except as disclosed on Exhibit 3.16, to MJA's Knowledge there are no
outstanding claims for wages, vacations, or other benefits or compensation of
any type or description, whether currently payable or deferred under any defined
benefit pension plan, any defined contribution pension plan, any implied or
deemed employee benefit or plan, or any welfare plan or otherwise or any other
policy, program or practice, whether formal or informal, by any of MJA'
employees or any other individuals covered by or eligible under such plans or
programs, other than wages that will become due for current pay periods and/or
benefits that have accrued through the Closing Date and will become payable in
the future. To the best knowledge of Stockholders after due diligence and
investigation and except as disclosed on Exhibit 3.16 hereof, Stockholders are
aware of no claimed, threatened or existing claims by any of MJA' employees with
respect to any applicable Workers' Compensation, worker health or safety, equal
employment opportunity or discrimination, wage and hour, wrongful discharge,
personnel or other employment related statutes, laws or common law rights of any
type or description. Except as disclosed on Exhibit 3.16 hereof, there is no
collective bargaining agreement in existence between MJA and a collective
bargaining representative for any of MJA' employees, Except as disclosed on
Exhibit 3.16 hereof, during the one (1) year period immediately preceding the
date of this Agreement, Stockholders and MJA are not aware of any union
organizing activities or proceedings involving, or any petitions for election of
or demands for
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recognition by, a labor union or labor organization as the exclusive bargaining
agent for any of MJA's employees. MJA had not received notice of any proceeding
involving MJA currently pending before the National Labor Relations Board,
including but not limited to any wherein a labor organization is seeking
representation of any of MJA's employees.
SECTION 3.25 WARN
MJA has not taken, or caused to be done, any action which may cause or have
the effect of causing any of the provisions of Worker Adjustment and Retraining
Notification Act ("WARN") to be applied or become applicable to MJA,
Stockholders or Westower. As of the date of this Agreement Stockholders and MJA
do not, and will not as of the Closing Date unless prior notice is given by
Stockholders to Westower, know of any fact or facts which could cause MJA,
Stockholders or Westower to be deemed to have engaged in a plant closing or mass
lay-off (as those terms are defined in WARN).
SECTION 3.26 COMPLIANCE WITH LAWS
Except as provided in Exhibit 3.26 hereto, to MJA's Knowledge, MJA has
complied in all material respects with and is currently complying in all
material respects with all applicable federal state and local statutes,
regulations, orders, ordinances and other laws material to the ownership and use
of the properties of MJA, the utilization of any properties leased by MJA and
the operation of the business of MJA.
SECTION 3.28 EMPLOYEE BENEFIT PLANS
(a) BENEFIT PLANS
Exhibit 3.28 hereof contains an accurate and complete list of each bonus,
deferred compensation, hospitalization or other medical stock purchase, pension,
life or other insurance, profit sharing or retirement plan or arrangement, and
other employee benefit plan or arrangement maintained or contributed to by MJA,
whether formal or informal and whether legally binding or not. MJA and the
Stockholders have heretofore delivered to Westower true and complete copies of
the documents governing all such plans or arrangements as in effect on the date
hereof and at all times hereafter to and including the date of Closing. MJA has
no plan or commitment, whether formal or informal and whether legally binding or
not, to create any additional such plan or arrangement or to modify or change
any existing plan or arrangement, except with respect to the MJA's 401(k) Profit
Sharing Plan, which is
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being revised to reflect changes in the laws governing tax-qualified pension
plans made by the Tax Reform Act of 1986 and other legislative and regulatory
actions. MJA has heretofore delivered to Westower a complete copy of the most
recent draft of the MJA 401(k) Profit Sharing Plan.
(b) PENSION AND WELFARE BENEFIT PLANS
Exhibit 3.28 sets forth a true and complete list of each of the "employee
pension benefit plans" and the "employee welfare benefit plans, as such terms
are defined in Sections 3(2) and 3(1) of the Employee Retirement Income Security
Act of 1974, as amended ("ERISA"), currently maintained by or contributed to by
MJA (collectively, the "Plans") and the fiscal year end for each. To MJA's
Knowledge, each of the Plans has been administered in compliance with its terms
and all filing, reporting, disclosure and other requirements of ERISA and the
requirements of the Code have been satisfied with respect to each of the Plans.
(c) WITHDRAWAL LIABILITY
Except as disclosed on Exhibit 3.28 hereto, MJA's Knowledge, no amount of
"withdrawal liability" (as that term is used in Section 4201 of ERISA) has been
or is reasonably expected to be assessed against MJA, nor is MJA otherwise aware
of any facts or circumstances that could lead to assessment of withdrawal
liability, nor has MJA been notified by any multi-employer plan (as that term is
defined in Section 4001(a)(3) or ERISA) that such multi-employer plan is in
reorganization or insolvency within the meaning of Section 4241 or Section 4245
of ERISA or that such multi-employer plan intends to terminate or has terminated
under Section 4041A of ERISA. To MJA's Knowledge, MJA has not withdrawn, either
partially or completely, from any multi-employer plans listed on Exhibit 3.28
hereof.
(d) NO PROHIBITED TRANSACTIONS
To MJA's Knowledge, neither any of the Plans nor any trust created
thereunder, nor any trustee or administrator thereof, has engaged in a
"prohibited transaction" (as such term is defined in Section 406 of ERISA) in
connection with which any of the Plans, any such trust, or any trustee or
administrator thereof, or any party dealing with the Plans or any such trust
could be subject to either a civil penalty assessed pursuant to Section 502(i)
of ERISA or a tax imposed by Section 4975 of the Code.
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(e) NO PBGC LIABILITY
As of the date of this Agreement, MJA is not aware and has received no
notice that it has incurred any liability to the Pension Benefit Guaranty
Corporation ("PBGC") with respect to any of the Plans or with respect to any
other employee benefit plan maintained or contributed to by MJA that has been
terminated or otherwise discontinued prior to the date of this Agreement. To
the best of MJA's Knowledge, the PBGC has not instituted proceedings to
terminate any of the Plans. MJA HAS NOT received any notice of and has no
knowledge of a "reportable event" (within the meaning of Section 4043(b) of
ERISA). Except as is set forth on Exhibit 3.28 hereof, no Plan to which Title
IV of ERISA applies has been terminated whose "date of termination" (within the
meaning of Section 4048 of ERISA) occurred after September 1, 1974. To MJA's
Knowledge, no event has occurred and there exists no condition or set of
circumstances as of the date of this Agreement, which presents a material risk
as of such date of the termination of any of the Plans which could result in any
liability on the part of MJA to the PBGC.
(f) FULL PAYMENT TO PLANS
Full payment has been made of all amounts which MJA is required to pay
under the terms of each of the Plans as a contribution to the Plans as of the
last day of the most recent fiscal year of each of the Plans ended prior to the
date of this Agreement. Except as disclosed on Exhibit 3.28 hereto, to MJA's
Knowledge none of the Plans nor any trust established thereunder has incurred
any "accumulated funding deficiency" (as defined in Section 302 of ERISA and
Section 412 of the Code), whether or not waived, as of the last day of the most
recent fiscal year of each of the Plans ended prior to the date of this
Agreement or the most recent contribution date as required under the terms of
any such Plans if later.
(g) PLANS IN COMPLIANCE WITH LAWS
To MJA's Knowledge, each of the employee benefit plans maintained or
contributed to by MJA, including, without limitation, the Plans, is in
compliance with applicable federal, state and local laws, including but not
limited to ERISA and the applicable laws of jurisdictions outside of the United
States. To the best of MJA's Knowledge each of the Plans that is intended to be
"qualified" has been administered in accordance with the requirements of Section
401(a) of the Code, but no determination letter has been requested or received
from the IRS with respect to qualification of such Plans, and no facts or
circumstances exist which would adversely affect the qualified status of the
Plans, except that the MJA's 401(k) Profit Sharing Plan is being revised to
reflect changes in the laws governing tax-qualified pension
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plans made by the Tax Reform Act of 1986 and other legislative and regulatory
actions. Except as may be disclosed on Exhibit 3.16 no matter relating to any of
the Plans is pending before any court or governmental agency. None of the
representations set forth in this subsection (g) are given with respect to any
multi-employer plan (as defined in Section 4001(a)(3) of ERISA) to which MJA
contributes or has contributed.
SECTION 3.29 EMPLOYEE LIST
The list of MJA Employees attached hereto as Exhibit 3.29 list each
employee of MJA who has been employed by MJA for a period of at least one year
before the date of Closing.
SECTION 3.30 FULL DISCLOSURE
No information furnished by MJA to Westower in connection with this
Agreement (including, but not limited to, the MJA Financial Statements and all
information in the Schedules and Exhibits hereto) is false or misleading in any
material respect. MJA has not made any untrue statement of a material fact or
omitted to state a material fact necessary in order to make the statements made
or information delivered in or pursuant to this Agreement not misleading.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF STOCKHOLDERS
Stockholders, jointly and severally, represent and warrant to Westower as
follows:
SECTION 4.1 STOCK OF MJA
The authorized capital stock of MJA consists of one hundred (100) shares of
$1 par value common stock. The MJA Stock constitutes all of the capital stock
of MJA which is issued and outstanding, all of which stock is validly issued and
outstanding, fully paid and non-assessable. No person has any preemptive right
to purchase or subscribe for any of the common stock of MJA or any other
securities of MJA arising out of any issuance or sale by MJA of any shares of
its authorized but unissued common stock or any other securities of MJA prior to
the Closing Date. There are no outstanding securities of MJA which are
convertible into or exchangeable for any shares of its capital stock and there
is no existing contract, option, warrant, call or similar commitment of any
character granted or issued by
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MJA calling for or relating to the issuance or transfer of shares of capital
stock or any other securities of MJA.
SECTION 4.2 OWNERSHIP OF MJA STOCK
Each of the Stockholders owns and holds of record the number of shares of
MJA Stock which are to be delivered by said Stockholder pursuant to Section 1.1
hereof. Each of the Stockholders has good title to said shares of Stock free
and clear of all claims, liens, charges and encumbrances of any nature
whatsoever. Each of the Stockholders has full power over said shares of MJA
Stock subject to no proxy, shareholders' agreement or voting trust other than as
provided herein, and has full right, power and authority to consummate the Share
Exchange in the manner provided for in this Agreement.
SECTION 4.3 STOCKHOLDERS' BROKER
Stockholders have not utilized the services of any broker in arranging for
the transactions contemplated by this Agreement. There are no investment
bankers, brokers or other like entities that will claim from Westower any
broker's, finder's, or like fee on account of services performed for
Stockholders in connection with the consummation of the transactions
contemplated by this Agreement. Westower acknowledges and agrees that Suncoast
Capital Corp. will be paid $215,000 by MJA pursuant to its advisory agreement
with MJA.
SECTION 4.4 INVESTMENT INTENT: RESALE OF WESTOWER SHARES
The Westower Shares received by the Stockholders with respect to the Share
Exchange are being obtained by the Stockholders for investment, for his or her
own account, not as a nominee or agent and not with a view to any distribution,
sale or subdivision thereof.
SECTION 4.5 NO CURRENT REGISTRATION OF WESTOWER SHARES
The Stockholders each acknowledge and understand that the Westower Shares
issued to him or her as part of the Share Exchange have not been registered with
the Securities and Exchange Commission or with any state official or agency and
are being offered and issued pursuant to exemptions from registrations set forth
in the Securities Act of 1933 and applicable state blue sky laws, and that no
governmental agency has recommended or endorsed the Westower Shares or made any
finding or determination relating to the fairness of the Share Exchange.
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SECTION 4.6 INFORMATION RELATED TO WESTOWER SHARES
The Stockholders have each received and had an opportunity to review the
following documents: (a) Final Prospectus filed October 10, 1997; (b) Form 8A
filed October 14, 1997 and (c) Form 10-Q filed January 15, 1998 (hereinafter,
collectively the Westower Information.). Each of the Stockholders acknowledges
that Westower has made available to the Stockholders the opportunity to ask
questions and receive answers concerning Westower, this Agreement and the
Westower Shares and to obtain any additional information which Westower
possesses or can acquire without unreasonable effort or expense that is
necessary to verify the accuracy of such additional information and/or the
Westower Information.
SECTION 4.7 KNOWLEDGEABLE
Each of the Stockholders possess such knowledge and experience in financial
and business matters or has been advised by such persons who do possess such
knowledge that he or she is capable of evaluating the merits and risks of the
investment in Westower Shares contemplated by the Share Exchange.
ARTICLE V
REPRESENTATIONS AND WARRANTS OF WESTOWER
Westower represents and warrants to Stockholders as follows:
SECTION 5.1 WESTOWER'S ORGANIZATION AND AUTHORITY
Westower is a corporation duly organized, validly existing and is in good
standing under the laws of the State of Washington. Westower has the full power
and authority to execute and deliver this Agreement and carry out and perform
its undertakings and obligations under this Agreement and each of Westower's
Closing Documents. The execution and delivery by Westower of this Agreement and
the consummation by Westower of the transactions contemplated in this Agreement,
including the execution and performance of each of Westower's Closing Documents,
have been duly authorized by all proper and requisite proceedings and will not
conflict with or breach any provision of any agreement or other instrument
(including Westower's Articles of Incorporation and By-laws) to which Westower
is a party or by which it or its properties or assets is bound. This Agreement
has been, and each of Westower's Closing Documents will be, duly and validly
executed and delivered by Westower. Assuming due authorization, execution and
delivery by Stockholders, this Agreement is, and each of Westower's Closing
Documents will be, the legal valid and binding obligation of Westower,
enforceable against it in accordance with their
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respective terms, subject, as to enforceability, to bankruptcy and other
equitable principles. Westower has all requisite power and authority to own,
lease and operate its properties and is duly licensed and qualified to do
business and in good standing in each of the states in which the nature or
character of its business and operations require it to be qualified.
SECTION 5.2 WESTOWER'S COMPLIANCE WITH OTHER INSTRUMENTS
Westower will not be on the Closing Date in violation of any term of, or
will have obtained a waiver of any applicable violation of, its Certificate of
Incorporation or by-laws or any indenture, contract, agreement or instrument
affecting or related to Westower Shares to which Westower is a party, or any
judgment, decree or order binding upon Westower or its properties. The
execution, delivery and performance of and compliance with this Agreement and
Westower's Closing Documents will not result in any such violation for which
such a waiver has not been obtained or be in conflict with or constitute a
default under any such term, or result in the creation of any mortgage, pledge,
lien, encumbrance or charge upon any of the Westower Shares to exchanged for MJA
Stock hereunder. No consent, approval or other action by any governmental
authority is required in connection with the execution, delivery and performance
by Westower of this Agreement.
SECTION 5.3 WESTOWER'S BROKER
Westower has not utilized the services of any broker in arranging for the
transactions contemplated by this Agreement. There are no investment bankers,
brokers or other like entities that will claim from Stockholders any broker's,
finder's, or like fee on account of services performed for Westower in
connection with the consummation of the transactions contemplated by this
Agreement.
SECTION 5.4 WESTOWER SHARES
The Westower Shares, when issued, delivered and exchanged for the MJA Stock
in accordance with this Agreement and the Articles of Share Exchange, will be
duly and validly issued and outstanding, fully paid and nonassessable, and will
not have been issued in violation of or subject to any preemptive rights.
SECTION 5.5 FILINGS WITH THE SEC
Westower has made all filings with the SEC that it has been required to
make within the past three years under the Securities Act of 1933, as amended
(the Securities Acts), and the Securities Exchange Act of 1934, as amended (the
Exchange
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Acts and collectively, the "Public Reports"). Each of the Public Reports has
complied with the Securities Act and the Exchange Act in all material respects.
None of the Public Reports, as of their respective dates, contained any untrue
statement of a material fact or omitted to state a material fact necessary in
order to make the statements made therein, in light of the circumstances under
which they were made, not misleading.
SECTION 5.6 SUBSEQUENT EVENTS: INVESTMENT INFORMATION
Subsequent to the respective dates as of which information is given in the
Public Reports, there has been no material adverse change or any fact known to
Westower and not disclosed to the Stockholders that could reasonably be expected
to result in a material adverse change in the business or financial condition of
Westower, and, except as disclosed in the Public Reports, there is no litigation
or governmental proceeding to which Westower is a party or to which any property
of Westower is subject or that is pending or, to the knowledge of Westower,
contemplated against Westower that might result in any material adverse change
in the business or financial condition of Westower.
SECTION 5.7 FINANCIAL STATEMENTS
The February 28, 1998 Balance Sheet attached hereto as Exhibit 5.7 presents
fairly, in all material respects, the financial position of Westower as of that
date, and the results of Westower's operations and changes in financial
position, for the periods indicated, all in conformity with GAAP, consistent
with past accounting practices and business practices. "Material" as used in
this Section means within Four Hundred Thousand U.S. Dollars ($400,000) of
Westower's actual financial condition.
SECTION 5.8 NO UNDISCLOSED LIABILITIES
Westower had no known material liabilities or obligations of any nature,
whether absolute, accrued contingent or otherwise and whether due or to become
due, that were not reflected on the balance sheet attached as Exhibit 5.7 or in
the notes thereto, respectively (except those incurred by Westower in the
ordinary course of business thereafter or which are of a type not ordinarily
reflected on a balance sheet prepared in accordance with GAAP), and Westower is
not aware of any basis for assertion against Westower of any such liability.
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SECTION 5.9 TAXES
Westower has paid or adequately accrued for all material tax obligations,
and Westower has filed all its material tax returns which have become due and
for which no extension have been sought.
SECTION 5.10 ACCOUNTS RECEIVABLE
All accounts and notes receivable of Westower reflected on the balance
sheet attached as Exhibit 5.7 are bona fide, and have arisen in the ordinary
course of business. The balance sheet attached as Exhibit 5.7 contains adequate
provisions for doubtful accounts in accordance with GAAP. Notwithstanding the
foregoing, Westower does not warrant collectibility of any particular accounts
and notes receivable contained in the accounts and notes receivable reflected on
the balance sheet attached as Exhibit 5.7.
SECTION 5.11 CONFLICTS WITH LAWS; OTHER INSTRUMENTS
Neither the execution and delivery of this Agreement nor the consummation
of the transactions contemplated hereby nor compliance by any Westower with any
of the provisions hereof will: (a) to Westower's Knowledge, conflict with, or
result in a breach or contravention of, or in a default or the creation of any
lien under, any of the terms, conditions or provisions of any note, bond,
mortgage indenture, license, agreement or other instrument or obligations
(including without limitation Westower's Articles of Incorporation and By-laws)
to which Westower is a party or by which it or any of its properties or assets
may be bound, except where such breach or default will not have a material
adverse effect on Westower's business or (b) violate any order, writ, injunction
or decree applicable to Westower or any of its or their properties or assets.
To Westower's Knowledge no consent, approval or other action by any governmental
authority is required in connection with the execution, delivery and performance
by Westower of this Agreement. Except for the risk of a general economic
downturn or moratoria affecting Westower's business of the types described in
documents Westower has caused to be filed with the SEC, to Westower's Knowledge,
there are no changes in any regulation, ordinance, law, order or other
requirement materially affecting any property or operation of Westower or any
condemnation proceeding pending, or threatened, which will prohibit Westower
from continuing the use of any of its properties or assets or from continuing to
operate its business substantially in the manner in which it has been conducted
prior to the Closing Date. "Westower's Knowledge" as used in this Agreement
means the knowledge of its corporate officers which knowledge is formed after
reasonable investigation and due diligence.
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SECTION 5.12 GOVERNMENTAL AUTHORIZATIONS
Westower has, consistent with good business practice, all such licenses,
permits, clearances and other authorizations from the United States federal,
state and local as well as all foreign national provincial and local,
authorities as Westower deems necessary for the conduct of its business and
operations for which the failure to have such licenses, permits, clearances, and
other authorizations would have a material adverse effect on Westower's
business.
SECTION 5.13 CLAIMS, ADMINISTRATIVE ACTIONS, AND LAWSUITS
Except as to those matters which have been settled or otherwise resolved
prior to the date hereof, Westower is not aware of and has not been served with,
any notice or claim by any governmental agency, customer, employee or any other
party whatsoever relating to: (a) the business or operations of Westower; (b)
any infringement or misappropriation of any patent or other intellectual
property right in connection with performance of the services provided by
Westower and/or any equipment manufactured or sold by Westower; (c) any
environmental claim associated with operations of Westower or the ownership or
operation of any property or properties by Westower; (d) any claim of non-
compliance by Westower under the Occupational Safety and Health Act, any foreign
safety laws or other applicable governmental safety regulation; (e) any
negligence claims or errors and omissions claims with respect to any services
performed by Westower prior to the Closing Date or any goods or products sold by
Westower prior to the Closing Date; (f) any violation of any term or condition
of any permit or license held by Westower; (g) any Workers' Compensation
statutes (other than matters as are not reportable on Form OSHA 200) and any
other applicable worker health or safety, equal employment opportunity or
discrimination, wage and hour, collective bargaining agreement, wrongful
discharge, personnel or other employment related statutes, laws or common law
rights of any type or description; or (h) any litigation of any type related in
any way to the business and operations of Westower.
SECTION 5.14 INSURANCE
Westower has all policies of fire, liability, title and other forms of
insurance material to its business. All such policies will be in force on the
Closing Date in accordance with their respective terms, including without
limitation, with respect to any insured losses resulting from occurrences prior
to the Closing Date. Westower is not in material default with respect to any
provisions of any such policy and has not failed to give any notice or failed to
present any material claim thereunder, as to which it has knowledge, in due and
timely fashion.
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SECTION 5.15 POOLING OF INTERESTS
To Westower's Knowledge, there are no facts relating to Westower that
preclude the transactions contemplated by this Agreement from qualifying for
"pooling of interests" accounting treatment.
SECTION 5.16 ABSENCE OF CERTAIN CHANGES OR EVENTS
Since February 28, 1998, as relates to Westower, there has not been:
(a) any loss, damage or destruction in the nature of a casualty loss
or otherwise, whether covered by insurance or not, of any asset or assets, the
destruction of which, taken singly or in the aggregate is material to the
business and operations of Westower;
(b) except for the risk of a general economic downturn or moratoria
affecting Westower's business of the types described in documents Westower has
caused to be filed with the SEC, to the knowledge of Stockholders, the adoption,
promulgation or rescission of any statute, regulation, order, ordinance or other
law, the adoption, promulgation or rescission of which materially and adversely
affects any of the business and operations of Westower as they are currently
being conducted;
(c) any material failure to maintain the books and records of
Westower in the usual, regular and ordinary manner and in accordance with good
business practice and GAAP;
(d) any declaration, setting aside or payment of any dividend, or
other distribution, in respect of any capital stock of Westower or any direct or
indirect redemption, purchase or other acquisition of any capital stock of
Westower by or on behalf of Westower;
(e) any issuance or sale by Westower of any of its or their stock,
bonds or other securities;
(f) any labor controversy or the threatening of any strike, work
stoppage or slowdown materially affecting the business or assets of Westower;
(g) any sale, sale/lease back transfer, or other disposition of any
material tangible asset of Westower (material for purposes of this Section being
any transaction or agreement having a value in excess of $100,000), except in
the ordinary course of business, other than agreements relating to the purchase
and sale of inventory and/or contract equipment in the ordinary course of
business in excess of
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$100,000, or any sale, assignment, transfer or other disposition of any of its
material patents, trademarks, trade names, brand names, copyrights, licenses or
other intangible assets;
(h) any amendment, termination or waiver of any right of material
value belonging to Westower;
(i) any increase in the compensation payable or to become payable by
Westower to any of its or their officers, employees or agents, other than normal
merit and cost-of-living increases in accordance with the general prevailing
practices of Westower existing prior to the date of this Agreement;
(j) any changes with respect to Westower's ordinary and customary
practices with respect to the invoicing of customers, the collection of any of
the accounts receivable, and payment of any accounts payable; or
(k) except for the risk of a general economic downturn or moratoria
affecting Westower's business of the types described in documents Westower has
caused to be filed with the SEC, any material change in the nature of the
business of Westower.
SECTION 5.17 ENVIRONMENTAL LIABILITIES
To Westower's Knowledge, in the operation of the business of Westower prior
to the Closing Date, including but not limited to the ownership or operation of
any real properties, Westower: (a) is not aware that it is in violation of any
existing common law or any federal foreign, state or local laws, regulations,
statutes or ordinances relating to personal injury arising out of Hazardous
Substances (as such term is hereinafter defined) or protection of the
environment (collectively, the "Environmental Laws"); (b) possesses all of the
material permits, licenses, approvals and identification numbers required under
any Environmental Laws for the operation of each of the Westower Facilities in
the manner in which any such facility is presently operated, (c) is in
compliance in all material respects with all permits, licenses and approvals
required by any of the Environmental Laws for the operation of each of Westower
Facilities in the manner in which each such facility is currently being
operated, except for such non-compliance as would not be reasonably expected to
lead to imposition of penalties or similar sanctions by regulatory agencies; (d)
is not aware of any conditions that will affect the continued validity after the
Closing Date of all such permits, licenses and approvals required by any
Environmental Laws for the operation of any of the Westower Facilities in the
manner in which it is currently being operated; (e) is not aware of the
existence of any pending or threatened suits,
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proceedings, investigations or claims with respect to sites of, or the
operations conducted at any of the Westower Facilities relating to the
enforcement of any Environmental Laws or to determine the existence of any
environmental liabilities; (f) is not aware of the existence of any pending or
threatened suits, proceedings or claims by any third parties for damages or
injunctive relief arising out of the presence of any emissions, discharges,
releases or threatened releases, storage, transportation or the handling of
pollutants, contaminants, regulated wastes or hazardous wastes (collectively,
the Hazardous Substances) on or off the sites of any of Westower Facilities
allegedly caused, directly or indirectly, by the operations of Westower at any
such facility; (g) is not aware of the existence of any citizen complaint
relating to the site of any of the Westower Facilities or the operations of
Westower at any such facility; (h) other than normal wear and tear on equipment
that may alter its performance, is not aware of any existing circumstances that
may interfere with the continued compliance with any existing permit, license or
approval required by statute or regulations for the operation of any of the
Westower Facilities in the manner in which it is presently operated, except for
such non-compliance as would not be reasonably expected to lead to imposition of
penalties or similar sanctions by regulatory agencies; (i) is not aware of the
occurrence of any spill discharge, deposit or other release of any Hazardous
Substances, in excess of reportable quantities under Federal or state
environmental laws and which has led or is likely to lead to enforcement actions
by governmental agencies, at any of the Westower Facilities caused, directly or
indirectly, by Westower; (k) is not aware of any asbestos conditions at any of
the Westower Facilities; (1) is not aware of any transformers, fixtures or other
electrical equipment containing PCB's installed in, affixed to or located at any
of the Westower Facilities; (m) is not aware of any storage tanks, in excess of
250 gallons, for petroleum or hazardous substances located at any of the
Westower Facilities, whether above ground, underground or within a structure;
(n) is not aware of any current or prior use of the premises of the Westower
Facilities which would give rise to liability under any Environmental Laws; and
(a) is not aware of any potential liability under any Environmental Laws arising
out of any pre-Closing utilization of or operations at any of the Westower
Facilities by Westower or other third parties and has not been placed on notice
of any claim of any governmental agency or other regulatory body claiming
violation of any Environmental Laws or requiring any remediation or cleanup with
respect to any of the Westower Facilities or requiring any change in the means
or methods of operation of any such facility.
SECTION 5.18 ABSENCE OF QUESTIONABLE PAYMENTS
To Westower's Knowledge, neither Westower nor any of its directors,
officers, agents, employees or any other Person acting on behalf of Westower has
used any of
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Westower's funds for improper or unlawful contributions, payments, gifts or
entertainment, or made any unlawful expenditures relating to political activity
to governmental officials or others. Neither Westower nor any of its current
directors, officers, agents, employees or any other Person acting on behalf of
Westower has accepted or received any improper or unlawful contributions,
payments, gifts or expenditures. Westower has at all times complied, and is in
compliance, in all material respects with the applicable provisions of the U.S.
Foreign Corrupt Practices Act, as amended, and other applicable domestic and
foreign laws and regulations relating to corrupt practices and similar matters.
SECTION 5.19 COMPLIANCE WITH LAWS
To Westower's Knowledge, Westower has complied in all material respects
with and is currently complying in all material respects with all applicable
federal state and local statutes, regulations, orders, ordinances and other laws
material to the ownership and use of the properties of Westower, the utilization
of any properties leased by Westower and the operation of the business of
Westower.
SECTION 5.20 EMPLOYEE BENEFIT PLANS
EMPLOYEE BENEFIT PLANS
(a) BENEFIT PLANS
Westower has no plan or commitment, whether formal or informal and whether
legally binding or not, to create any additional such plan or arrangement or to
modify or change any existing plan or arrangement, except with respect to the
Westower's 401(k) Profit Sharing Plan, which is being revised to reflect changes
in the laws governing tax-qualified pension plans made by the Tax Reform Act of
1986 and other legislative and regulatory actions.
(b) PENSION AND WELFARE BENEFIT PLANS
Each of the "employee pension benefit plans" and the "employee welfare
benefit plans, as such terms are defined in Sections 3(2) and 3(1) of the
Employee Retirement Income Security Act of 1974, as amended ("ERISA"), currently
maintained by or contributed to by Westower is referred to in this Section as
the "Plans. To Westower's Knowledge, each of the Plans has been administered in
compliance with its terms and all filing, reporting, disclosure and other
requirements of ERISA and the requirements of the Code have been satisfied with
respect to each of the Plans.
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(c) WITHDRAWAL LIABILITY
No amount of "withdrawal liability" (as that term is used in Section 4201
of ERISA) has been or is reasonably expected to be assessed against Westower,
nor is Westower otherwise aware of any facts or circumstances that could lead to
assessment of withdrawal liability, nor has Westower been notified by any multi-
employer plan (as that term is defined in Section 4001(a)(3) or ERISA) that such
multi-employer plan is in reorganization or insolvency within the meaning of
Section 4241 or Section 4245 of ERISA or that such multi-employer plan intends
to terminate or has terminated under Section 4041A of ERISA. To Westower's
Knowledge, Westower has not withdrawn, either partially or completely, from any
multi-employer plans.
(d) NO PROHIBITED TRANSACTIONS
To Westower's Knowledge, neither any of the Plans nor any trust created
thereunder, nor any trustee or administrator thereof, has engaged in a
"prohibited transaction" (as such term is defined in Section 406 of ERISA) in
connection with which any of the Plans, any such trust, or any trustee or
administrator thereof, or any party dealing with the Plans or any such trust
could be subject to either a civil penalty assessed pursuant to Section 502(i)
of ERISA or a tax imposed by Section 4975 of the Code.
(e) NO PBGC LIABILITY
As of the date of this Agreement, Westower is not aware and has received no
notice that it has incurred any liability to the Pension Benefit Guaranty
Corporation ("PBGC") with respect to any of the Plans or with respect to any
other employee benefit plan maintained or contributed to by Westower that has
been terminated or otherwise discontinued prior to the date of this Agreement.
To Westower's Knowledge, the PBGC has not instituted proceedings to terminate
any of the Plans. Westower has not received any notice of and has no knowledge
of a "reportable event" (within the meaning of Section 4043(b) of ERISA). No
Plan to which Title IV of ERISA applies has been terminated whose "date of
termination" (within the meaning of Section 4048 of ERISA) occurred after
September 1, 1974. To Westower's Knowledge, no event has occurred and there
exists no condition or set of circumstances as of the date of this Agreement,
which presents a material risk as of such date of the termination of any of the
Plans which could result in any liability on the part of Westower to the PBGC.
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(f) FULL PAYMENT TO PLANS
Full payment has been made of all amounts which Westower is required to pay
under the terms of each of the Plans as a contribution to the Plans as of the
last day of the most recent fiscal year of each of the Plans ended prior to the
date of this Agreement. To Westower's Knowledge none of the Plans nor any trust
established thereunder has incurred any "accumulated funding deficiency" (as
defined in Section 302 of ERISA and Section 412 of the Code), whether or not
waived, as of the last day of the most recent fiscal year of each of the Plans
ended prior to the date of this Agreement or the most recent contribution date
as required under the terms of any such Plans if later.
(g) PLANS IN COMPLIANCE WITH LAWS
To Westower's Knowledge, each of the employee benefit plans maintained or
contributed to by Westower, including, without limitation, the Plans, is in
compliance with applicable federal, state and local laws, including but not
limited to ERISA and the applicable laws of jurisdictions outside of the United
States. To the best of Westower's Knowledge each of the Plans that is intended
to be "qualified" has been administered in accordance with the requirements of
Section 401(a) of the Code, but no determination letter has been requested or
received from the IRS with respect to qualification of such Plans, and no facts
or circumstances exist which would adversely affect the qualified status of the
Plans, except that the Westower's 401(k) Profit Sharing Plan is being revised to
reflect changes in the laws governing tax-qualified pension plans made by the
Tax Reform Act of 1986 and other legislative and regulatory actions. No matter
relating to any of the Plans is pending before any court or governmental agency.
None of the representations set forth in this subsection (g) are given with
respect to any multi-employer plan (as defined in Section 4001(a)(3) of ERISA)
to which Westower contributes or has contributed.
SECTION 5.21 BLACKOUT PERIOD IN SECTION 6.12
The restrictions imposed on Stockholders by Section 6.12 hereof are no more
restrictive than the similar restrictions imposed on the Chief Executive Officer
of Westower and the Chief Financial Officer.
SECTION 5.22 FULL DISCLOSURE
No information furnished by Westower to Westower in connection with this
Agreement (including, but not limited to, the financial statement attached as
Exhibit 5.7 and all information in the Schedules and Exhibits hereto) is false
or misleading in
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any material respect. Westower has not made any untrue statement of a material
fact or omitted to state a material fact necessary in order to make the
statements made or information delivered in or pursuant to this Agreement not
misleading.
ARTICLE VI
COVENANTS OF STOCKHOLDERS
Except as to the covenants in Sections 6.9 through 6.15, which apply post-
Closing, Stockholders hereby covenant and agree from the date hereof to the
Closing Date that, except for transactions expressly authorized by this
Agreement, including transactions consented to in writing by Westower, they will
or they will cause MJA to comply with the following:
SECTION 6.1 ACCESS TO PLANT AND RECORDS
MJA will afford to the authorized representatives of Westower such access
during regular business hours to the properties, books and records of MJA as
Westower may from time to time reasonably request by prior notice.
SECTION 6.2 ORDINARY COURSE OF BUSINESS
MJA will operate its business substantially as now operated and only in the
ordinary course, and, to the extent consistent with such operation, it will use
its best efforts to preserve intact its present business organization, to keep
available the services of its present officers and key employees and to preserve
its relationships with persons having business dealings with it. MJA will
maintain its or their books, accounts and records in the usual, regular and
ordinary manner in conformity with GAAP.
SECTION 6.3 MAINTENANCE OF PROPERTY
MJA will maintain all of its assets in customary repair, order and
condition, reasonable wear and use and damage by unavoidable casualty excepted,
and take all steps necessary to maintain its intangible assets, including
without limitation, its patents, trademarks, tradenames, brand names, copyrights
and any pending applications therefor.
SECTION 6.4 NO NEW MATERIAL AGREEMENTS
MJA will not enter into any material leases, sale/lease back transactions,
agreements for the purchase of fixed assets, exclusive services agreements, or
other material agreements (material for purposes of this Section being any
transaction or
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agreement having a value in excess of $100,000), other than agreements relating
to the purchase and sale of inventory and/or contract equipment in the ordinary
course of business in excess of $100,000.
SECTION 6.5 COMPENSATION
MJA will not: (a) grant any increase in compensation other than normal
merit and cost-of-living increases in accordance with MJA' general prevailing
practices existing prior to the date of this Agreement to any officer, employee
or agent, or (b) enter into or amend any bonus, incentive compensation, deferred
compensation, profit sharing, retirement, pension, group insurance, death
benefit or other fringe benefit plan, trust agreement, or arrangement, or any
employment, compensation or consulting agreement except as required by law.
SECTION 6.6 INDEBTEDNESS
MJA will not create, incur, assume guarantee or otherwise become liable
with respect to any indebtedness for money borrowed or voluntarily create,
incur, assume or guarantee any other indebtedness or obligation other than in
the ordinary course of business.
SECTION 6.7 NO SECURITIES ISSUED
MJA will not issue any shares of its common stock or enter into any
contract, or grant any option, warrant or right, calling for the issuance of any
shares, and will not create any securities convertible into any such shares or
convertible into securities in turn so convertible, or enter into any contract,
or grant any option, warrant or right, calling for the issuance of any such
convertible security.
SECTION 6.8 REPURCHASE; DIVIDENDS
Except for the distribution of $1,500,000 to the Stockholders, which will
be part return of capital and part a distribution, MJA will not redeem,
repurchase or otherwise acquire any common shares of MJA, or, without the
consent of Westower, declare or pay any dividend in cash, securities or other
property.
For the covenants in Sections 6.9 through 6.15, Stockholders hereby
covenant and agree, except for transactions authorized by this Agreement,
including transactions consented to in writing by Westower, they will or they
will cause MJA to comply with the following:
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SECTION 6.9 TERMINATION OF STOCKHOLDERS AGREEMENT
Each of the Stockholders agrees that he or she will enter into an agreement
or agreement with the other Stockholders and MJA, effective on or prior to the
Closing Date, providing for the termination of any stockholders agreement among
the Stockholders with respect to the MJA Shares.
SECTION 6.10 COOPERATION
The Stockholders will cooperate and will cause MJA to cooperate fully with
Westower in promptly taking any and all action or executing any and all
documents appropriate to consummate the transactions contemplated by this
Agreement, including but not limited to, cooperation in the filing of and the
supply of any information required in order to complete the preparation by
Westower of the Registration Statement (as such term is hereinafter defined) and
any amendments thereto that may be requested or required by the Securities and
Exchange Commission.
SECTION 6.11 REGISTRATION REQUIRED PRIOR TO SALE OF WESTOWER SHARES
Each of the Stockholders agrees that he or she will not sell, transfer or
otherwise assign any of the Westower Shares received by him or her until such
time as permitted under Rule 144 of the Securities and Exchange Commission or a
Registration Statement to be filed by Westower pursuant to the provisions of
Section 7.3 below becomes effective and during such time as such Stockholder may
be engaged in a distribution of any of the Westower Shares, such Stockholder
will comply with the provisions of the Securities Act of 1933 and the Securities
Exchange Act of 1934. In order to evidence such agreement, the Stockholders
further agrees that following legend may be placed by Westower upon the
certificates representing the Westower Shares: THE SHARES REPRESENTED BY THIS
CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 BUT HAVE
BEEN ACQUIRED FOR INVESTMENT BY THE REGISTERED OWNER. THE REOFFER, RESALE, OR
REDISTRIBUTION OF THESE SHARES MAY NOT BE MADE EXCEPT IN COMPLIANCE WITH THE
SECURITIES ACT OF 1933 AND WITH THE PROVISIONS OF CERTAIN AGREEMENTS TO WHICH
THE CORPORATION IS A PARTY. COPIES OF SAID AGREEMENTS ARE ON FILE WITH THE
SECRETARY OF THE CORPORATION.
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SECTION 6.12 BLACKOUT PERIOD
At any time after the effective date of the Registration Statement, if
Westower is negotiating or involved in a significant transaction ("significant"
for purposes of this Section being defined as an acquisition or disposition of,
or a merger with, a business entity having assets or revenues exceeding 10% of
Westower's consolidated assets or consolidated revenues) on written notice from
Westower that it requires the suspension by the Stockholders of the distribution
of any of the Westower Shares, then the Stockholders shall cease distributing
the Westower Shares for such period of time (Blackout Periods), not to exceed
120 days from the time notice is sent until Westower informs the stockholders
that the Blackout Period has been terminated. Upon notice by Westower to the
Stockholders of such determination, the Stockholders covenant and agree that
they shall (a) keep the fact of any such notice strictly confidential (b)
promptly halt any offer, sale, trading or transfer of any of the Westower Shares
for the duration of the Blackout Period, and (c) promptly halt any use,
publication, dissemination or distribution of the shelf registration provided
for herein, each prospectus included therein, and any amendment or supplement
thereto by it and any of its affiliates for the duration of the Blackout Period.
SECTION 6.13 SHARE EXCHANGE
Each of the Stockholders agrees that promptly following the execution of
this Agreement he or she will approve the Plan of Share Exchange and will cause
MJA to approve and execute the Plan of Share Exchange and to provide Westower
with all materials and information necessary for Westower to file the Articles
of Share Exchange with the Secretary of State of the State of Washington and
will take all actions and do all things necessary, proper or advisable in order
to consummate the Share Exchange and effect all the transactions contemplated by
this Agreement.
SECTION 6.14 ELECTION TO CLOSE BOOKS
Each of the Stockholders agrees to that promptly following the Closing he
or she take whatever steps are necessary to cause MJA to sign and deliver to the
Internal Revenue Service the Election to Close Books Upon S Corporation
Termination and will execute the Consent of Shareholders to such election.
SECTION 6.15 TRANSFER OF PERMITS
Xxxxxxx X. Xxxxxxxx controls X. X. Xxxxxxxx Construction Corp. and, he and
X.X. Xxxxxxxx Construction Corp. will cause the licenses, permits, clearances,
and
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authorizations listed on Exhibit 3.15 to be transferred to MJA or will apply
for new such licenses, permits, clearances, and authorizations in the name of
MJA.
ARTICLE VII
COVENANTS OF WESTOWER
Westower hereby covenants and agrees:
SECTION 7.1 CONFIDENTIALITY
For itself and its affiliates, that it shall maintain in confidence and
neither disclose to any third party nor make commercial use of all or any part
of any information disclosed by Stockholders or MJA in connection with the
transactions contemplated hereunder; provided, however, that the obligations
contained in this Section shall not apply to such portions of such information
which were known to Westower without obligation of confidentiality prior to
disclosure to Westower by Stockholders or MJA, as the case may be, as
demonstrated by competent documentary evidence in Westower's possession, or
which properly became available to Westower, under conditions which do not
restrict further disclosure, from a third party source who shall not have
obtained such information either directly or indirectly from Stockholders or MJA
or which now or hereafter comes into the public domain without fault on the part
of Westower, or its employees. With respect to information disclosed to
Westower related to the business and operations of MJA, the foregoing obligation
of confidentiality shall apply prior to the Closing of the transactions
contemplated by this Agreement, or, if no such Closing takes place, for a period
of two (2) years from the date of this Agreement.
SECTION 7.2 WESTOWER'S COOPERATION
Westower agrees that promptly following the signing of this Agreement it
will approve the Plan of Share Exchange and will file the Articles of Share
Exchange with the secretary of State of the State of Washington. Westower will
cooperate fully with Stockholders and MJA in promptly taking any and all action
or executing any and all documents appropriate to consummate the transactions
contemplated by this Agreement.
SECTION 7.3 REGISTRATION AND LISTING OF THE WESTOWER SHARES
(a) Westower will use all commercially reasonable efforts: (a) to file
with the Securities and Exchange Commission, within one hundred and eighty (180)
days of the Closing Date, a registration statement ("Registration Statement") on
Form S-3
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(or other form appropriate for registration of the Westower Shares for resale to
the public) under the Securities Act of 1933; and (b) thereafter, subject to
reasonable diligence and practicality, to cause such Registration Statement to
become effective and to remain effective until the date that is the earlier of:
(i) the date on which all of the Westower Shares have been sold by the
Stockholders or (ii) one year after the Closing Date. To the extent that any of
the Westower Shares are not listed with the American Stock Exchange on the date
of this Agreement, on or before the date that Westower files the Registration
Statement, Westower shall file with the American Stock Exchange a listing
application with respect to such shares. Westower agrees that any legend placed
on certificates representing the Westower Shares which restricts resale of the
Westower Shares will be removed, upon the effectiveness of the Registration
Statement.
(b) Notwithstanding the foregoing, the Company shall not be obligated to
effect any such registration pursuant to this Section 7.3 if (i) Form S-3 is not
available for such offering by the Stockholders, or (ii) the Company shall
furnish a certificate signed by the President of the Company stating that in the
good faith judgment of the Board of Directors of the Company, it would be
seriously detrimental to the Company and its shareholders for such Registration
Statement to be filed and it is therefore essential to defer the filing of such
Registration Statement, in which event the Company shall have the right to defer
such filing for up to two periods of no more than 120 days each after delivery
of such certificate under this Section 2
(c) If (but without any obligation to do so) Westower decides to register
(including for this purpose a registration effected by Westower for shares other
than the Westower shares) any of its common stock on a form that would be
suitable for a registration involving Registrable Securities , the Company shall
promptly give each Stockholder written notice thereof. Upon the written request
of each such Stockholder given within 20 days after mailing of such written
notice by the Westower, Westower shall use commercially reasonable efforts to
cause to be registered under the 1933 Securities Act (as amended) all of the
Registrable Securities specified in such written request. In the event that
Westower decides, for any reason, not to complete the registration of shares of
common stock other than the Registrable Securities, the Company shall have no
obligation under this Section 7.3 to continue with the registration of the
Registrable Securities.
For purposes of this Section 7.3, the term "Registrable Securities" means
any common stock of Westower issued or issuable in exchange for or in
replacement of, the Westower Shares, excluding in all cases, however, (i) any
Registrable Securities sold by a person in a transaction in which rights under
this Agreement are not
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assigned, (ii) any Registrable Securities sold in a public offering pursuant to
a Registration Statement filed with the SEC or sold to the public pursuant to
Rule 144 promulgated under the Act, or (iii) any Registrable Securities which
may be sold in the public market in a three-month period without registration
under the Act pursuant to Rule 144.
SECTION 7.4 TAX MATTERS
Westower makes no representation or warranty with respect to, and expressly
disclaims any responsibility for, any Tax consequences to the Stockholders
arising out of the structure or terms of this Agreement, or the negotiation or
consummation hereof. Each of the Stockholders have consulted with his or her
own tax advisor in such matter and shall be solely responsible for any such Tax
consequences.
SECTION 7.5 ELECTION TO CLOSE BOOKS
Westower agrees that promptly following the Closing it will cooperate in
efforts, or cause MJA, to sign and deliver to the Internal Revenue Service the
Election to Close Books Upon S Corporation Termination and will execute the
Consent of Shareholders to such election.
ARTICLE VIII
CONDITIONS PRECEDENT TO STOCKHOLDERS' OBLIGATIONS
The obligations of Stockholders to consummate the transactions provided for
in this Agreement are, at the option of Stockholders, subject to satisfaction of
the following conditions at or before the Closing Date:
SECTION 8.1 WESTOWER'S REPRESENTATIONS AND WARRANTIES
All the covenants, terms and conditions of this Agreement to be complied
with or performed by Westower at or before the Closing Date shall have been
complied with and performed in all material respects. The representations and
warranties made by Westower in this Agreement shall be true and correct in all
material respects at and as of the Closing Date with the same force and effect
as though such representations and warranties had been made at and as of the
Closing Date, except that any representation or warranty that by its terms is
made with reference to a specific date shall have been correct in all material
respects as of such date. A representation or warrant that is expressly subject
to a materiality limitation shall not be subject to a
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further materiality limitation as a result of the use of the phrase "in all
material respects" in the preceding sentence.
SECTION 8.2 WESTOWER'S DELIVERY OF DOCUMENTS
Westower shall have duly executed and delivered, or caused to be executed
and delivered, to Stockholders, this Agreement and Westower's Closing Documents.
SECTION 8.3 STOCKHOLDER APPROVAL
This Agreement and the Plan of Share Exchange shall have been approved and
adopted by the affirmative vote of the Stockholders.
SECTION 8.4 OTHER APPROVALS
All authorizations, consents, orders or approvals of any United States
federal or state governmental agency necessary for the consummation of the Share
Exchange or the transactions contemplated hereby (other than such actions,
approvals or filings which, pursuant to the terms of this Agreement, are to take
place on or after the Closing) shall have been filed, occurred or been obtained.
SECTION 8.5 NO LITIGATION
No administrative investigation, action, suit or proceeding seeking to
enjoin the consummation of the transactions contemplated under this Agreement
shall be pending or threatened.
SECTION 8.6 WAIVERS AND CONSENTS OBTAINED
Westower shall have obtained all such consents, waivers, orders and
approvals as may be necessary so as to cure, resolve or otherwise avoid any
conflict, breach or default, lien creation or violation that would have been
caused by consummation of the transactions contemplated hereunder had such
consents, waivers, orders and approvals not been obtained.
ARTICLE IX
CONDITIONS PRECEDENT TO WESTOWER'S OBLIGATIONS
The obligation of Westower to consummate the transactions provided for in
this Agreement are, at the option of Westower, subject to satisfaction of the
following conditions at or before the Closing Date:
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SECTION 9.1 REPRESENTATIONS AND WARRANTIES
All the covenants, terms and conditions of this Agreement to be complied
with or performed by Stockholders on or before the Closing Date shall have been
complied with and performed in all material respects. The representations and
warranties made by Stockholders in this Agreement shall be true and correct in
all material respects at and as of the Closing Date with the same force and
effect as though such representations and warranties had been made at and as of
the Closing Date, except that any representation or warranty that by its terms
is made with reference to a specific date shall have been correct in all
material respects as of such date. A representation or warrant that is
expressly subject to a materiality limitation shall not be subject to a further
materiality limitation as a result of the use of the phrase "in all material
respects" in the preceding sentence.
SECTION 9.2 LEASE AGREEMENT
MJA shall have entered into a valid and binding Lease Agreement, and
recorded in the appropriate real property records Memorandum of Lease, in form
suitable to Westower for MJA's continued use of the real property at its office
in Palm Beach Gardens for an initial term of 2 years, with an option for MJA to
renew such Lease Agreement for a term of five years upon the exercise of such
option.
SECTION 9.3 STOCKHOLDERS' DELIVERY OF DOCUMENTS
Stockholders shall have duly executed and delivered, or caused to be
executed and delivered, to Westower this Agreement and the Stockholders' Closing
Documents.
SECTION 9.4 OTHER APPROVALS
All authorizations, consents, orders or approvals of any United States
federal or state governmental agency necessary for the consummation of the Share
Exchange or the transactions contemplated hereby (other than such actions,
approvals or filings which, pursuant to the terms of this Agreement, are to take
place on or after the Closing) shall have been filed, occurred or been obtained.
SECTION 9.5 NO LITIGATION
No administrative investigation, action, suit or proceeding seeking to
enjoin the consummation of the transactions contemplated under this Agreement
shall be pending or threatened.
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SECTION 9.6 WAIVERS AND CONSENTS OBTAINED
Stockholders shall have obtained all such consents, waivers, orders and
approvals related to those matters listed on Exhibit 3.14 hereof, as may be
necessary so as to cure, resolve or otherwise avoid any conflict, breach or
default, lien creation or violation that would have been caused by consummation
of the transactions contemplated hereunder had such consents, waivers, orders
and approvals not been obtained.
SECTION 9.7 STOCKHOLDER APPROVAL
This Agreement and the Plan of Share Exchange shall have been approved and
adopted by the affirmative vote of the Stockholders.
SECTION 9.8 AFFILIATE LETTER; POOLING OF INTERESTS
An affiliate letter in a form acceptable to Westower's accountants shall
have been signed by the Stockholders, and each officer and director of MJA. MJA
or its affiliates shall not have taken any action inconsistent with accounting
for the transactions contemplated by this Agreement as a pooling of interests or
Westower's accountants shall have advised Westower that the transactions
contemplated by this Agreement cannot be accounted for under the pooling of
interests method.
ARTICLE X
INDEMNIFICATION
SECTION 10.1 INDEMNIFICATION BY STOCKHOLDERS
Subject to consummation of the Closing and the further provisions of this
Section 10.1, Stockholders hereby severally (in proportion to their share
ownership in MJA)agree to indemnify and hold Westower, its subsidiaries,
parents, affiliates, officers, directors, agents and employees (collectively,
the "Westower Indemnified Parties") harmless from and against and with respect
to any Damages to any Westower Indemnified Parties as hereinafter defined,
provided that: (a) the Stockholders have received notice from Westower of a
claim for indemnification under this Section with respect to the matters covered
by Section 3.7 prior to the expiration of the applicable statute of limitations
with respect to such matters, and (b) the Stockholders have received notice from
Westower of a claim for indemnification under Section 10.2 with respect to all
other matters within one (1) year from the Closing Date. The term "Damages," as
used herein, shall include any claim, action, loss, cost, expense, liability,
penalty or interest or damage, including,
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without limitation, reasonable counsel fees, and all reasonable costs and
expenses of all actions, suits, proceedings, demands, assessments, claims and
judgments resulting from, occurring in connection with, or arising out of any
breach of any representation, warranty or covenant by any of the Stockholders
made in the Agreement or in any of the Stockholders' Closing Documents.
Notwithstanding anything to the contrary set forth in this Article X,
indemnification of the Westower Indemnified Parties by the Stockholders shall in
excess of the aggregate for any amounts in excess Ten Million U.S. Dollars
($10,000,000) plus attorneys' fees and other cost included in Damages.
Notwithstanding anything to the contrary set forth in this Agreement, with
respect to claims for indemnification pursuant to this Section 10.1, Westower
Indemnified Parties will not be entitled to any indemnification, defense or
holding harmless, from the Stockholders, and the Stockholders will not be
required to indemnify, defend or hold harmless any of the Westower Indemnified
Parties, for any Damages unless and until, and only to the extent that, such
claims exceed Two Hundred Fifty Thousand U.S. Dollars ($250,000) in the
aggregate, at which time the Stockholders shall be liable for all such Damages
including the first $250,000.
The representations and warranties of the Stockholders and MJA herein
contained shall survive the Closing (y) with respect to matters covered by
Section 3.7 of this Agreement, solely for the period ending on the expiration of
the applicable statutes or limitations, and (z) with respect to all other
representations and warranties contained in Article III and IV of this
Agreement, solely for a period of one (1) year from the Closing Date.
The rights of the Westower Indemnified Parties under this Article X shall
be their exclusive remedy with respect to any claim for Damages; provided,
however, that the foregoing clause of this sentence shall not be deemed a waiver
by any party to this Agreement of any of its rights or remedies arising by
reason of any claim of fraud.
SECTION 10.2 NOTICE OF ASSERTED CLAIMS BY THIRD PARTIES
If any claim or assertion of liability is made or asserted by a third party
against a Westower Indemnified Party based on any liability or obligation which,
if established, would entitle the Westower Indemnified Party to indemnification
by the Stockholders, such Westower Indemnified Party shall with reasonable
promptness give to the Stockholders written notice of the claim or assertion of
liability and request the Stockholders defend the same, attaching to such notice
copies of any documents evidencing such claim which the Westower Indemnified
Party has received. Failure to so notify the Stockholders shall not relieve the
Stockholders of any liability that the Stockholders might have to a Westower
Indemnified Party. Within ten (10) days after
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such notice shall have been given, the Stockholders shall in writing advise the
Westower Indemnified Party whether they elect to defend against such claim. The
failure of the Stockholders to give such advice within such ten (10) period
shall be deemed an election not to defend against such claim. In the event that
such advice of election to defend is given within such ten (10) day period, then
the Stockholders shall have the right to defend, at their expense, actively and
in good faith against such claim with counsel of their own choice, which counsel
choice shall be subject to the reasonable approval of Westower, including,
without limitation, the right to settle and compromise such claim and to take
such appeals as may be necessary or desirable in connection therewith. The
Westower Indemnified Parties shall cooperate and assist in the defense of such
claim, to the extent reasonably requested by the Stockholders and, in the event
that the Westower Indemnified Parties desire additional counsel, they may retain
such counsel as they may select at their expense. Counsel selected by the
Stockholders and the Westower Indemnified Parties shall consult with and advise
each other, but the control of all such litigation, including the compromise or
settlement thereof and the taking of appeals, shall be determined by counsel for
the Stockholders.
SECTION 10.3 INVESTIGATIONS; WAIVERS
The right of the Westower Indemnified Parties to the indemnification
provided in this Article X shall remain in effect notwithstanding any
investigation at any time by or on behalf of any party hereto or any waiver by
any party hereto of any condition to such party's obligations to consummate the
transactions contemplated hereby.
ARTICLE XI
TERMINATION; WAIVER AND AMENDMENT
SECTION 11.1 TERMINATION
This Agreement may be terminated in any one of the following ways:
(a) At any time on or prior to the Closing Date by the mutual consent
in writing of the Stockholders and Westower; or,
(b) On the Closing Date: (i) by the Stockholders, in writing, if the
conditions set forth in Article VIII above hereof shall not have been met; or
(ii) by Westower, in writing, if the conditions set forth Article IX above shall
not have been met; or,
(c) By Stockholders or Westower, if the Closing shall not have
occurred on or prior to May 31, 1998.
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SECTION 11.2 WAIVER AND AMENDMENT
(a) Westower, by written instrument signed by its authorized officer
or representative, or the Stockholders, by a written instrument signed by
Xxxxxxx X. Xxxxxxxx as representative of the Stockholders, may at any time
extend the time for the performance of any of the obligations or other acts of
any other party hereto and may waive, with respect to such other party, (i) any
inaccuracies in the representations and warranties contained in this Agreement
or in any document delivered pursuant hereto, (ii) compliance with any of the
covenants, undertakings or agreements, or satisfaction of any of the conditions
to its obligations, contained in this Agreement, or (iii) the performance
(including performance to the satisfaction of a party) of any obligation set out
herein. Any waiver by any party of a condition to its obligation to perform this
Agreement and the subsequent Closing hereunder shall be in writing and shall be
without prejudice to the rights or remedies it may have arising out of any
subsequent or different breach of the same or any other any representation,
warranty, covenant or other agreement hereunder. Any waiver or extension
hereunder executed by Xxxxxxx X. Xxxxxxxx as representative of the Stockholders
shall likewise serve as a waiver or extension by all of the other Stockholders
as well without further consent or writing by each of the Stockholders
individually.
(b) The provisions of this Agreement may not be changed, modified or
amended except by way of a writing duly executed by each of the parties hereto.
Any modification or amendment hereunder executed by Xxxxxxx X. Xxxxxxxx as
representative of the Stockholders, shall likewise serve as a modification or
extension by all of the Stockholders as well without a further consent or
writing by each of the Stockholders individually.
ARTICLE XII
MISCELLANEOUS
SECTION 12.1 EXPENSES
Other than the expense of MJA's professional advisors to the extent of
$250,000 to be paid by MJA, each party shall pay its own expenses for the
preparation and execution of this Agreement and in connection with the
transactions contemplated hereby, whether or not this Agreement goes to Closing
or terminates pursuant to the provisions of Article XI hereof. Likewise,
Stockholders shall be responsible for payment of any expenses related to the
preparation, execution and obtaining of any of Stockholders' Closing Documents
and Westower shall be responsible for any expenses related to the preparation,
execution and obtaining of any of Westower's Closing Documents. Following the
Closing, in the event that MJA receives any bills or
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invoices for expenses that the Stockholders have agreed to pay pursuant to the
provisions of this Section 12.1, then Westower shall promptly forward such bills
or invoices to the Stockholders. The Stockholders will make payment of such
bills or invoices promptly and in accordance with their terms of payment.
SECTION 12.2 COMPLIANCE WITH SECURITIES LAWS
The Stockholders each agree, with respect to any reoffer, resale or
redistribution of any of the Westower Shares received in connection with the
Share Exchange, that they each will agree to comply with any federal or state
securities laws, including but not limited to the Securities Act of 1933 which
relate to any such reoffer, resale or redistribution.
SECTION 12.3 EXHIBITS INCORPORATED BY REFERENCE
All exhibits and schedules to this Agreement referenced in this Agreement
are, by such reference, incorporated herein.
SECTION 12.4 NOTICES
Any notice, request, instruction or other document to be given hereunder by
any party or parties hereto to the other parties will be effective upon receipt
by the other parties if given in writing, delivered personally, mailed by
registered or certified mail, postage paid, sent by commercial overnight
delivery service, fees prepaid, or sent by confirmed facsimile transmission to
the following addresses or facsimile transmission numbers:
(a) If to Stockholders, addressed to:
Xxxxxxx X. Xxxxxxxx
0000 Xxxxxxx Xxxx
Xxxx Xxxxx Xxxxxxx, Xxxxxxx 00000
With a courtesy copy to:
Xxxxxxx Xxxxxxxx
Gunster, Yoakley Xxxxxx-Xxxxx & Xxxxxxx, P.A.
Xxxxxxxx Point, Suite 500 East
000 Xxxxx Xxxxxx Xxxxx
Xxxx Xxxx Xxxxx, Xxxxxxx 00000-0000
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Facsimile Transmission Number: 000-000-0000
Confirmation Number: 561-655-1980
Xxxx Xxxxxxxx, III
X.X. Xxx 00000
Xxxx Xxxx Xxxxx, XX 00000
Xxxxx X. XxXxxxxx
Bond Xxxxxxxxx & King
0000 Xxxxx Xxxxxxx Xxxxxxx
Xxxx Xxxxx, XX 00000
(b) If to Westower, addressed to:
Mr. Xxxxx Xxxxx
Westower Corporation
2653 000 Xxxxx XX
Xxxxxxx, XX 00000
Facsimile Transmission Number:
Confirmation Number:
With a courtesy copy to:
Xxxx Xxxxxx
Xxxxxxx Coie LLP
One Bellevue Center
000-000xx Xxxxxx X.X. Xxxxx 0000
Xxxxxxxx, XX 00000
Facsimile Transmission Number: 000-000-0000
Confirmation Number: 000-000-0000
Failure to send a courtesy copy of any notice as provided above shall not make
the provision of such notice defective. Any party hereto may direct in writing
that notices or courtesy copies thereof be sent to other or additional addresses
by like notice.
SECTION 12.5 COUNTERPARTS
This Agreement may be executed in one or more counterparts, each of which
shall be deemed to be an original instrument, but all of which together shall
constitute
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but one instrument. Confirmation by electronic transmission of a facsimile
signature page shall be binding on any party so confirming.
SECTION 12.6 PARTY IN INTEREST
This Agreement is made solely for the benefit of Westower and each of the
Stockholders, and no other person, partnership, trust association or corporation
shall acquire or have any right under or by virtue of this Agreement. This
Agreement shall be binding on the parties hereto and their respective
successors, heirs and assigns.
SECTION 12.7 ENTIRE AGREEMENT; WRITING REQUIRED TO AMEND
This Agreement, including the Exhibits hereto, constitutes the entire
agreement among the parties with respect to the subject matter hereof and
supersedes all prior agreements and understandings of the parties in connection
therewith. No covenant or condition not expressed in this Agreement shall
affect or be effective to interpret, change or restrict this Agreement.
SECTION 12.8 PARTIAL INVALIDITY
If any term, provision, covenant or condition of this Agreement is held by
any court of competent jurisdiction to be invalid, void or unenforceable, the
remainder of the provisions hereof shall continue in full force and effect.
SECTION 12.9 HEADINGS
The sections headings provided in this Agreement are for convenience only
and are in no way intended to affect the meaning or import of any of the
language contained in this Agreement.
SECTION 12.10 PRECEDENCE OF DOCUMENTS
In the event that there is a conflict between the terms of this Agreement
and any other agreement, document, instrument and writing executed or entered
into by any of the parties hereto with respect to any of the transactions
contemplated by this Agreement, the terms and conditions of this Agreement shall
take precedence.
SECTION 12.11 CHOICE OF LAW; FORUM SELECTION
This Agreement shall be governed by and construed according to the laws of
the State of Washington. The federal and state courts located in King County,
State of Washington, shall have the exclusive jurisdiction over any dispute
under this
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Agreement, and each of the undersigned consents to personal jurisdiction in such
court.
SECTION 12.12 ENFORCEMENT COST
Except as provided in Article X, if any civil action, arbitration, or other
legal proceeding is brought for the enforcement of this Agreement, or because of
an alleged dispute, breach, default, or misrepresentation in connection with any
provision of this Agreement, the successful or prevailing party or parties shall
be entitled to recover reasonable attorneys' fees, sales and use taxes, court
cost, and all expenses if not taxable court costs (including, without
limitation, all such fees, taxes, costs, and expenses incident to arbitration,
appellate, bankruptcy, and post-judgment proceedings), incurred in that civil
action, arbitration or legal proceeding, in addition to any other relief to
which such party or parties may be entitled. Attorneys' fees shall include,
without limitation, paralegal fees, investigative fees, administrative costs,
sales and use taxes, and all other charges billed by the attorney to the
prevailing party.
SECTION 12.13 EQUITABLE REMEDIES
Each of the parties acknowledges that the parties will be irreparably
damaged (and damages at law would be an inadequate remedy) if this Agreement is
not specifically enforced. Therefore, in the event of a breach or threatened
breach by any party of any provision of this Agreement, then the other parties
shall be entitled, in addition to all other rights or remedies, to an injunction
restraining such breach, without being required to show any actual damage or to
post an injunction bond, and/or to a decree for specific performance of the
provisions of this Agreement.
SECTION 12.14 STOCKHOLDER ACCESS TO BOOKS AND RECORDS
Within 10 days of receipt of notice in writing of any audit of, or
deficiency notice to, MJA or the Stockholders which Westower receives with
respect to taxes for years ending on or prior to the Closing Date, Westower will
furnish a copy of such notice to Stockholders. Westower shall cooperate with
and give Stockholders reasonable access during normal business hours on advance
notice to the records of MJA for the period under examination and shall use its
best efforts to furnish any other documents or instruments necessary to enable
the Stockholders' representatives to properly defend the audit, deficiency or
other proceedings. If the Stockholders' exercise their right to prepare and
prosecute a tax refund claim, Westower will give Stockholders reasonable access
to the records of MJA and any other documents and instruments necessary to
enable the Stockholders' representatives to properly prepare and prosecute the
refund claim.
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SECTION 12.15 JOINT APPROVAL OF PRESS RELEASE
All press releases and public announcements related to this Agreement and
the transactions contemplated thereby must be approved in advance by Westower
and the Attorney appointed under Section 1.6.
SECTION 12.16 SURVIVAL
Without limiting of any other provision hereof, all provisions of this
Agreement which by their terms require or may require performance after the
Closing shall survive the Closing and for such period following the Closing as
may be required for Westower, MJA or Stockholders', as the case may be, to
fulfill their respective obligations thereunder; such provisions shall terminate
by their terms thereafter.
IN WITNESS WHEREOF, the parties to this Agreement have duly executed this
Agreement.
/s/ Xxxxxxx X. Xxxxxxxx
______________________________
XXXXXXX X. XXXXXXXX
/s/ Xxxxxxxxx X. Xxxxxxxx
______________________________
XXXXXXXXX X. XXXXXXXX
/s/ Xxxx Xxxxxxxx, III
______________________________
XXXX XXXXXXXX, III
WESTOWER CORPORATION
By: /s/ Xxxxx Xxxxx Attest:
__________________________ _____________________________
Name: XXXXX XXXXX
Title: CHIEF FINANCIAL OFFICER
MJA COMMUNICATIONS CORP.
By: /s/ Xxxx Xxxxxxxx,III Attest: /s/ Xxxxxxx X. Xxxxxxxx
__________________________ _____________________________
Name: PRESIDENT
Title: Authorized Representative
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STATE OF FLORIDA )
) ss.
COUNTY OF PALM BEACH )
I, the undersigned notary public in and for the county aforesaid, do hereby
certify that I am satisfied that XXXXXXX X. XXXXXXXX personally did appear
before me this day; that he is the same XXXXXXX X. XXXXXXXX named in the
foregoing instrument; that he did acknowledge that he had signed and delivered
the foregoing instrument as his free and voluntary act and deed for the uses and
purposes therein expressed, who is personally known to me or who has produced a
motor vehicle driver's license as identification and who did not take an oath.
GIVEN UNDER my hand and official seal this 29th day of May, 1998.
/s/ Xxxxxxx X. Xxxxxxxx
--------------------------------------------------
(Signature of Notary)
Stamp of Xxxxxxx X. Xxxxxxxx
--------------------------------------------------
(Print or stamp name of Notary)
NOTARY PUBLIC in and for the State of Florida,
residing at .
-------------------------------------
My Commission Expires: .
--------------------------
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STATE OF FLORIDA )
) ss.
COUNTY OF PALM BEACH )
I, the undersigned notary public in and for the county aforesaid, do hereby
certify that I am satisfied that XXXXXXXXX X. XXXXXXXX personally did appear
before me this day; that she is the same XXXXXXXXX X. XXXXXXXX named in the
foregoing instrument; that she did acknowledge that she had signed and delivered
the foregoing instrument as her free and voluntary act and deed for the uses and
purposes therein expressed, who is personally known to me or who has produced a
motor vehicle driver's license as identification and who did not take an oath.
GIVEN UNDER my hand and official seal this 29th day of May, 1998.
/s/ Xxxxxxx X. Xxxxxxxx
--------------------------------------------------
(Signature of Notary)
Stamp of Xxxxxxx X. Xxxxxxxx
--------------------------------------------------
(Print or stamp name of Notary)
NOTARY PUBLIC in and for the State of Florida,
residing at .
-------------------------------------
My Commission Expires: .
--------------------------
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STATE OF FLORIDA )
) ss.
COUNTY OF PALM BEACH )
I, the undersigned notary public in and for the county aforesaid, do hereby
certify that I am satisfied that XXXX XXXXXXXX, III personally did appear before
me this day; that he is the same XXXX XXXXXXXX, III named in the foregoing
instrument; that he did acknowledge that he had signed and delivered the
foregoing instrument as his free and voluntary act and deed for the uses and
purposes therein expressed, who is personally known to me or who has produced a
motor vehicle driver's license as identification and who did not take an oath.
GIVEN UNDER my hand and official seal this 29th day of May, 1998.
/s/ Xxxxxxx X. Xxxxxxxx
--------------------------------------------------
(Signature of Notary)
Stamp of Xxxxxxx X. Xxxxxxxx
--------------------------------------------------
(Print or stamp name of Notary)
NOTARY PUBLIC in and for the State of Florida,
residing at .
-------------------------------------
My Commission Expires: .
--------------------------
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