1
Exhibit 2.5
STOCK PURCHASE AGREEMENT
BETWEEN
NORTHWEST BROADCASTING, L.P.
AND
SPECTRASITE HOLDINGS, INC.
Dated as of December 30, 1999
2
TABLE OF CONTENTS
ARTICLE 1 DEFINED TERMS............................................1
Section 1.1 Defined Terms.......................................1
Section 1.2 Terms Defined Elsewhere in this Agreement...........5
Section 1.3 Clarifications......................................5
ARTICLE 2 PURCHASE AND SALE OF SHARES..............................6
Section 2.1 Basic Transaction...................................6
Section 2.2 Purchase Price......................................6
ARTICLE 3 REPRESENTATIONS AND WARRANTIES OF SELLER RELATING TO
SELLER..................................................6
Section 3.1 Organization........................................6
Section 3.2 Authorization of Transaction; Consents..............6
Section 3.3 Noncontravention....................................7
Section 3.4 Brokers' Fees.......................................7
Section 3.5 The Shares..........................................7
Section 3.6 Disclosure..........................................7
ARTICLE 4 REPRESENTATIONS AND WARRANTIES OF BUYER..................7
Section 4.1 Organization of Buyer...............................7
Section 4.2 Authorization of Transaction; Consents..............8
Section 4.3 Noncontravention....................................8
Section 4.4 Brokers' Fees.......................................8
Section 4.5 Investment..........................................8
Section 4.6 SEC Filings.........................................9
Section 4.7 Disclosure..........................................9
ARTICLE 5 REPRESENTATIONS AND WARRANTIES OF SELLER CONCERNING THE
COMPANY.................................................9
Section 5.1 Organization, Qualification, and Corporate Power....9
Section 5.2 Capitalization......................................9
Section 5.3 Noncontravention; Consents.........................10
Section 5.4 Brokers' Fees......................................10
Section 5.5 Title to Assets....................................10
Section 5.6 Subsidiaries and Investments.......................11
-i-
3
TABLE OF CONTENTS
(continued)
Section 5.7 Financial Statements...............................11
Section 5.8 Events Subsequent to Most Recent Fiscal Year End...11
Section 5.9 Undisclosed Liabilities............................11
Section 5.10 Legal Compliance...................................12
Section 5.11 Tax Matters........................................12
Section 5.12 Governmental Licenses..............................13
Section 5.13 Real Property......................................13
Section 5.14 Intellectual Property..............................15
Section 5.15 Tangible Assets....................................15
Section 5.16 Contracts..........................................15
Section 5.17 Notes and Accounts Receivable; Accounts Payable....16
Section 5.18 Powers of Attorney.................................16
Section 5.19 Insurance..........................................16
Section 5.20 Litigation.........................................17
Section 5.21 Employees..........................................17
Section 5.22 Employee Benefits..................................18
Section 5.23 Guaranties.........................................20
Section 5.24 Environmental, Health and Safety Matters...........20
Section 5.25 Certain Business Relationships with the Company and
Its Affiliates....................................21
Section 5.26 Bank Accounts and Credits..........................21
Section 5.27 Inventory..........................................21
Section 5.28 Product and Service Warranty.......................21
Section 5.29 Year 2000 Compliance...............................22
Section 5.30 Disclosure.........................................22
ARTICLE 6 COVENANTS...............................................22
Section 6.1 Conduct of Business of the Company.................22
Section 6.2 Seller's Actions...................................24
Section 6.3 Other Actions......................................24
Section 6.4 Notification of Certain Matters....................24
-ii-
4
TABLE OF CONTENTS
(continued)
Section 6.5 Access to Information..............................25
Section 6.6 Cooperation; Further Assurances....................25
Section 6.7 Public Announcements...............................25
Section 6.8 Confidentiality....................................25
Section 6.9 Expenses; Taxes....................................26
Section 6.10 Control of the Company's Operations................26
Section 6.11 Xxxx-Xxxxx-Xxxxxx Filing...........................26
Section 6.12 Other Buyer Transactions...........................26
Section 6.13 Consents...........................................27
Section 6.14 Employee Benefits Matters..........................27
Section 6.15 Real Estate Matters................................27
Section 6.16 Tax Matters........................................28
Section 6.17 Intercompany Accounts..............................29
Section 6.18 Standby Letter of Credit...........................29
Section 6.19 Schedule Updates...................................29
Section 6.20 Post-Closing Covenants.............................29
Section 6.21 Insurance..........................................30
Section 6.22 Release............................................30
ARTICLE 7 CONDITIONS TO BUYER'S OBLIGATIONS.......................31
Section 7.1 Performance by the Company and Seller..............31
Section 7.2 Truth of Representations and Warranties............31
Section 7.3 Receipt of Consents................................31
Section 7.4 HSR Act and other Governmental Authorizations......31
Section 7.5 Deliveries.........................................31
Section 7.6 Material Adverse Effect............................31
Section 7.7 Repayment of Indebtedness and Certain Other
Obligation........................................32
Section 7.8 Affiliate Loans....................................32
Section 7.9 Certain Proceedings................................32
Section 7.10 Seller Actions.....................................32
ARTICLE 8 CONDITIONS TO THE OBLIGATIONS OF SELLER.................33
-iii-
5
TABLE OF CONTENTS
(continued)
Section 8.1 Performance by Buyer...............................33
Section 8.2 Truth of Representations and Warranties............33
Section 8.3 HSR Act............................................33
Section 8.4 Deliveries.........................................33
Section 8.5 Certain Proceedings................................33
Section 8.6 Buyer Actions......................................33
ARTICLE 9 CLOSING.................................................33
Section 9.1 Closing............................................33
Section 9.2 Deliveries and Actions by Seller...................34
Section 9.3 Deliveries and Actions by Buyer....................35
ARTICLE 10 TERMINATION.............................................35
Section 10.1 Termination........................................35
Section 10.2 Effect of Termination..............................36
ARTICLE 11 INDEMNIFICATION.........................................37
Section 11.1 Survival of Representations and Warranties.........37
Section 11.2 Indemnification by Seller..........................37
Section 11.3 Indemnification by Buyer...........................38
Section 11.4 Procedure for Indemnification......................39
Section 11.5 Indemnification Escrow.............................40
Section 11.6 Limitations on Indemnification; Exclusive Remedy...41
ARTICLE 12 MISCELLANEOUS...........................................43
Section 12.1 Governing Law......................................43
Section 12.2 Successors and Assigns.............................43
Section 12.3 Entire Agreement; Amendment........................43
Section 12.4 Notices, Etc.......................................43
Section 12.5 Delays or Omissions................................44
Section 12.7 Severability.......................................44
Section 12.8 Headings...........................................45
Section 12.9 Arbitration........................................45
Section 12.10 Exclusive Benefit..................................45
-iv-
6
TABLE OF CONTENTS
(continued)
Section 12.11 Construction.......................................45
Section 12.12 Exhibits and Schedules.............................45
Section 12.13 Time is of the Essence.............................45
-v-
7
STOCK PURCHASE AGREEMENT
This STOCK PURCHASE AGREEMENT is made and entered into as of December
30, 1999, by and between NORTHWEST BROADCASTING, L.P., a Delaware limited
partnership (the "Seller"), and SPECTRASITE HOLDINGS, INC., a Delaware
corporation (the "Buyer").
RECITALS
Seller owns all of the issued and outstanding capital stock of
Stainless, Inc., a Pennsylvania corporation (the "Company"), which is engaged in
the business of fabricating communications towers. Seller desires to sell to
Buyer, and Buyer desires to acquire from Seller, all of the issued and
outstanding capital stock of the Company, and the parties desire to enter into
this Agreement to set forth the terms and conditions of such purchase and sale.
NOW, THEREFORE, intending to be bound legally, and in consideration of
the mutual covenants and agreements set forth herein, the receipt and legal
sufficiency of which are hereby acknowledged, the parties agree as follows:
ARTICLE 1
DEFINED TERMS
Section 1.1.......Defined Terms. All capitalized terms not otherwise defined
elsewhere in this Agreement shall have the meanings ascribed to such terms in
this Section 1.1.
"Accredited Investor" has the meaning set forth in Regulation D
promulgated under the Securities Act.
"Affiliate" of any Person means any other Person directly or
indirectly controlling, controlled by or under common control with such Person
and any officer, director, general partner or family member of such Person. For
purposes of this definition, "control" as applied to any Person means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of such Person, whether through the
ownership of voting securities, by contract or otherwise. Without limiting the
foregoing, for purposes of this definition, SEPA shall be considered an
"Affiliate" of Seller and the Company.
"Business" means the business conducted by the Company, including the
engineering, fabrication, construction and maintenance of television and radio
transmission towers for entities in the broadcasting industry, and including the
business activities of the Company conducted at the Pine Forge facilities.
"Code" means the Internal Revenue Code of 1986, as amended.
"Compensation Arrangement" means any plan or compensation arrangement
other than an Employee Plan, whether written or unwritten, which provides to
employees, former employees, officers, directors, independent contractors or
shareholders of the Company, any
8
compensation or other benefits, whether deferred or not, in excess of base
salary or wages, including any bonus or incentive plan, stock rights plan,
deferred compensation arrangement, life insurance, stock purchase plan,
severance pay plan, change of control arrangements, and any other employee
fringe benefit plan.
"Consent" means the consents, permits and approvals of all Governmental
Authorities and other third parties (or notices to such parties) necessary to
consummate the sale of the Shares from Seller to Buyer and the other
transactions contemplated by this Agreement in a lawful manner and without
causing a default under, conflict with, or acceleration, violation or
termination of, any legal requirement or contract or agreement to which the
Seller or the Company is a party or bound, whether or not such consent is listed
on Schedule 3.2 or Schedule 5.3.
"Contracts" means all contracts, leases, non-governmental licenses and
other agreements and undertakings (including leases for personal or real
property and employment agreements), written or oral (including any amendments
and other modifications thereto) to which the Company is a party or which are
binding upon the Company or that relate to the assets or operations of the
business of the Company.
"Employee Plan" means any retirement or welfare plan or arrangement or
any other employee benefit plan as defined in Section 3(3) of ERISA which covers
employees, former employees, officers or directors of the Company, which the
Company or any ERISA Affiliate sponsors, maintains or by which the Company or
any ERISA Affiliate is bound on behalf of the employees, former employees,
officers or directors of the Company or to which the Company or any ERISA
Affiliate contributes or is required to contribute on behalf of the employees,
former employees, officers or directors of the Company.
"Environmental, Health and Safety Requirements" means all applicable
federal, state, local and foreign statutes, regulations, ordinances and other
provisions having the force or effect of law, all judicial and administrative
orders, all contractual obligations and all common law concerning public health
and safety, worker health and safety, and pollution or protection of the
environment, including all those relating to the presence, use, production,
generation, handling, transportation, treatment, storage, disposal,
distribution, labeling, testing, processing, discharge, release, threatened
release, control or cleanup of any hazardous materials, substances or wastes,
chemical substances or mixtures, pesticides, pollutants, contaminants, toxic
chemicals, petroleum products or byproducts, asbestos, polychlorinated
biphenyls, noise or radiation, each as amended and in effect at the time the
applicable representations and warranties and indemnities are made.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
"ERISA Affiliate" means each entity which is treated as a single
employer with the Company under Code ss.414(b), (c), (m), (n) or (o).
"FAA" means the Federal Aviation Administration.
"FCC" means the Federal Communications Commission.
-2-
9
"GAAP" means United States generally accepted accounting principles as
in effect from time to time.
"Governmental Authority" means any federal, state, local political
subdivision or other governmental or regulatory department, court, commission,
board, bureau, agency, authority or instrumentality, foreign or domestic.
"Governmental Licenses" means all licenses, permits, authorizations,
determinations and registrations issued by the FCC, the FAA or any other
Governmental Authority to the Company in connection with the conduct of the
Business.
"Intellectual Property" means (a) all inventions (whether patentable or
unpatentable and whether or not reduced to practice), all improvements thereto,
and all patents, patent applications, and patent disclosures, together with all
reissuances, continuations, continuations-in-part, revisions, extensions, and
reexaminations thereof, (b) all trademarks, service marks, trade dress, logos,
trade names and corporate names, together with all translations, adaptations,
derivations and combinations thereof and including all goodwill associated
therewith, and all applications, registrations, and renewals in connection
therewith, (c) all copyrightable works, all copyrights, and all applications,
registrations and renewals in connection therewith, (d) all mask works and all
applications, registrations and renewals in connection therewith, (e) all trade
secrets and confidential business information (including ideas, research and
development, know-how, formulas, compositions, manufacturing and production
processes and techniques, technical data, designs, drawings, specifications,
customer and supplier lists, pricing and cost information, and business and
marketing plans and proposals), (f) all computer software (including data and
related documentation), (g) all other proprietary rights, and (h) all copies and
tangible embodiments thereof (in whatever form or medium).
"Knowledge" means actual knowledge after reasonable investigation.
"Liability" means any liability (whether known or unknown, whether
asserted or unasserted, whether absolute or contingent, whether accrued or
unaccrued, whether liquidated or unliquidated, and whether due or to become
due), including any liability for Taxes.
"Liens" means any mortgage, pledge, lien, charge, claim, option,
conditional sales, security interest or other encumbrance, restriction or
limitation of any nature whatsoever.
"Material Adverse Effect" means any material adverse effect on, or
change in, the business, financial condition, net worth, assets, liabilities,
personnel, operations or results of operations of the Company or the ability of
Seller to execute, deliver or perform this Agreement and the other agreements
and documents contemplated hereby to which Seller is a party.
"Most Recent Balance Sheet" means the balance sheet contained within
the Most Recent Financial Statements.
"Multiemployer Plan" means a plan, as defined in ERISA ss.3(37) to
which Seller, the Company, or any ERISA Affiliate has contributed, is
contributing or is required to contribute.
-3-
10
"Multiple Employer Plan" means a plan, as defined in ERISA Section
4063(a), which Seller, the Company, or any ERISA Affiliate sponsors or maintains
or to which Seller, the Company, or any ERISA Affiliate contributed, is
contributing or is required to contribute.
"Ordinary Course of Business" means the ordinary course of business
consistent with past custom and practice (including with respect to quantity and
frequency).
"PBGC" means the Pension Benefit Guaranty Corporation.
"Person" means an individual, a partnership, a corporation, a limited
liability company, an association, a joint stock company, a trust, a joint
venture, an unincorporated organization, a governmental entity (or any
department, agency, or political subdivision thereof) or any other type of
entity.
"Prohibited Transaction" has the meaning set forth in ERISA ss.406 and
Code ss.4975.
"Real Property" means all real property, interests in real property,
leaseholds and subleaseholds, purchase options, easements, licenses, rights of
access, and rights of way and all buildings and other improvements owned,
leased, used or held by the Company, including the real property owned by SEPA
in Pine Forge, Pennsylvania, but excluding the real property owned by the
Company in Perkasie, Pennsylvania and the real property owned by SEPA in North
Wales, Pennsylvania.
"Securities Act" means the Securities Act of 1933, as amended.
"Securities Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"SEPA" means Stainless Enterprises of Pennsylvania, Inc.
"Shares" means the shares of common stock of the Company, par value
$1.00 per share.
"Subsidiary" means, with respect to the Company, any entity of which
the Company (either alone or through or together with any other Subsidiary),
owns directly or indirectly, stock or other equity interests constituting 50% or
more of the voting or economic interest in such entity.
"Tax" or "Taxes" means any and all taxes, fees, duties, tariffs,
imposts and other charges of any kind imposed by any governmental or taxing
authority, including: federal, state, local or foreign income, gross receipts,
windfall profits, severance, property, motor vehicle, ad valorem, value added,
production, sales, use, license, excise, franchise, capital, transfer,
recordation, payroll, employment, excise, severance, stamp, occupation, premium,
environmental (including taxes under Code ss.59A), customs duties, social
security (or similar), unemployment, disability, withholding, alternative or
add-on minimum, or other tax or governmental assessment, together with any
interest, additions, or penalties with respect thereto and any interest in
respect of such additions or penalties, whether disputed or not.
"Tax Return" means any return, declaration, report, claim for refund,
information return or other statement or document (including any related or
supporting information, any schedule or
-4-
11
attachment thereto and any amendment thereof) filed or required to be filed
with any federal, state, local or foreign taxing authority in connection with
the determination, assessment, collection, administration or imposition of an
Tax.
Section 1.2.......Terms Defined Elsewhere in this Agreement. In addition to the
defined terms in Section 1.1, the following is a list of defined terms used in
this Agreement and a reference to the Section hereof in which such term is
defined:
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Buyer Preamble
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Buyer Indemnified Parties Section 11.2
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Cash Consideration Section 2.2(b)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
CERCLA Section 5.24(e)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Claimant Section 11.4(a)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Closing Section 9.1
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Closing Date Section 9.1
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
COBRA Section 5.22(h)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Company Recitals
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Escrow Agent Section 11.5
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Financial Statements Section 5.6
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
HSR Act Section 6.11
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Indemnification Funds Section 11.5
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Indemnifying Party Section 11.4(a)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Losses Section 11.2
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Material Consents Section 7.3
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Material Contracts Section 5.16
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Material Governmental Licenses Section 5.12
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Most Recent Financial Statements Section 5.6
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Most Recent Fiscal Month End Section 5.6
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Most Recent Fiscal Year End Section 5.6
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Permitted Liens Section 5.5
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Post-Closing Escrow Agreement Section 11.5
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Purchase Price Section 2.2(a)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Representatives Section 6.5
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
SEC Section 4.6
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Seller Preamble
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Seller Indemnified Parties Section 11.3
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
SWDA Section 5.24(e)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Systems Section 5.29
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Termination Date Section 10.1(b)(i)
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Treasury Regulations Section 5.11(f)
-------------------------------------------------------------------------------
Section 1.3 Clarifications. Words used herein, regardless of the gender and
number specifically used, shall be deemed and construed to include any other
gender and any other number as the context requires. Use of the word "including"
herein shall be deemed and
-5-
12
construed to mean "including but not limited to."Except as specifically
otherwise provided in this Agreement in a particular instance, a reference
to a Section or Schedule is a reference to a Section of this Agreement or a
Schedule attached hereto, and the terms "hereof," "herein" and other like
terms refer to this Agreement as a whole, including the Schedules hereto, and
not solely to any particular part hereof.
ARTICLE 2
PURCHASE AND SALE OF SHARES
Section 2.1 Basic Transaction. Subject to the terms and conditions of this
Agreement, Buyer agrees to purchase from Seller, and Seller agrees to sell to
Buyer, all of the issued and outstanding Shares, constituting all of the issued
and outstanding capital stock of the Company, free and clear of all Liens, for
the consideration specified in Section 2.2.
Section 2.2 Purchase Price. Subject to Section 6.15 and Section 7.7, Buyer
agrees to pay to Seller at the Closing Forty Million Dollars ($40,000,000) (the
"Purchase Price") in cash payable by wire transfer of immediately available
funds to an account designated by Seller in writing not later than two business
days before the Closing Date. The cash paid to Seller pursuant to this Section
2.2 may be referred to hereinafter as the "Cash Consideration."
ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF SELLER RELATING TO SELLER
Seller hereby represents and warrants to Buyer that the statements
contained in this Article 3 are true, correct and complete as of the date of
this Agreement.
Section 3.1 Organization . Seller is duly organized, validly existing and in
good standing as a limited partnership under the laws of the State of Delaware.
The ownership and structure chart (dated April 15, 1997) provided to Buyer with
respect to Seller and the Company is true and complete in all material respects
as of the date of this Agreement.
Section 3.2 Authorization of Transaction; Consents. Seller has full power and
authority to execute and deliver this Agreement and the agreements contemplated
hereby and to perform its obligations hereunder and thereunder. The execution,
delivery and performance by Seller of this Agreement and the other documents to
be delivered by Seller pursuant to this Agreement have been duly authorized by
all necessary partnership action on the part of Seller. This Agreement and the
other documents to be delivered by Seller pursuant to this Agreement have been
duly executed and delivered (or, in the case of any such documents to be
executed and delivered at Closing, when executed and delivered will be duly
executed and delivered) and constitute (or, in the case of any such documents to
be executed and delivered at Closing, when executed and delivered will
constitute) the valid and legally binding obligation of Seller, enforceable
against it in accordance with its terms and conditions. Except for any notices
that may be required pursuant to the HSR Act or as set forth in Schedule 3.2,
Seller does not need to give any notice to, make any filing with, or obtain any
authorization, consent or approval of any
-6-
13
Governmental Authority or other third party in order to consummate the
transactions contemplated by this Agreement and the agreements contemplated
hereby and the transactions contemplated hereby and thereby in a lawful manner
and without causing a default under, conflict with, or acceleration,
violation or termination of any material legal requirement or material
contract or agreement to which the Seller or the Company is a party or bound.
Section 3.3 Noncontravention. Except for any notices that may be required
pursuant to the HSR Act or as otherwise set forth in Schedule 3.2, neither the
execution and delivery of this Agreement and the agreements contemplated hereby
by Seller, nor the consummation of the transactions contemplated hereby and
thereby by Seller, will (A) violate any material statute, regulation, rule,
injunction, judgment, order, decree, ruling, charge or other restriction of any
Governmental Authority to which Seller or the Company is subject or any
provision of their organizational documents or (B) conflict with, result in a
breach of, constitute a default under, result in the acceleration of, create in
any party the right to accelerate, terminate, modify, or cancel, or require any
notice under any material agreement, contract, lease, license, instrument, or
other arrangement to which Seller or the Company is a party or by which either
of them is bound or to which any of their assets are subject.
Section 3.4 Brokers' Fees. Seller has no liability or obligation to pay any fees
or commissions to any broker, finder, or agent with respect to the transactions
contemplated hereby.
Section 3.5 The Shares. Seller owns beneficially and of record one hundred (100)
Shares, which constitute all of the issued and outstanding shares of capital
stock of the Company and are free and clear of any restrictions on transfer,
Taxes, Liens, options, warrants, purchase rights, contracts, commitments,
equities, claims and demands. Seller is not a party to any option, warrant,
purchase right or other contract or commitment that could require it to sell,
transfer or otherwise dispose of any capital stock of the Company (other than
this Agreement) or that would require the Company to issue any capital stock of
the Company to any Person. Seller is not a party to any voting trust, proxy or
other agreement or understanding with respect to the voting of any capital stock
of the Company, other than this Agreement, or any other agreement or
understanding relating to the Company or its capital stock.
Seller or its Affiliates acquired directly or indirectly the Shares on September
19, 1997.
Section 3.6 Disclosure. The representations and warranties contained in this
Article 3 do not contain any untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements and information
in this Article 3 not misleading.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer represents and warrants to Seller that the statements contained
in this Article 4 are true, correct and complete as of the date of this
Agreement.
Section 4.1 Organization of Buyer. Buyer is a corporation duly organized,
validly existing and in good standing under the laws of the State of Delaware.
Buyer is duly authorized to conduct business and is in good standing under the
laws of each jurisdiction where such
-7-
14
qualification is required, except where the failure to be so qualified would
not have a material adverse effect on the business, financial condition, net
worth, assets, liabilities, personnel, operations or results of operation
of Buyer and its Subsidiaries taken as a whole or the ability of Buyer to
execute, deliver or perform this Agreement and the other agreements and
documents contemplated hereby to which Buyer is a party.
Section 4.2 Authorization of Transaction; Consents. Buyer has full power and
authority to execute and deliver this Agreement and the agreements contemplated
hereby and to perform its obligations hereunder and thereunder. The execution,
delivery and performance by Buyer of this Agreement and the other documents to
be delivered by Buyer pursuant to this Agreement have been duly authorized by
all necessary corporate action on the part of Buyer. This Agreement and the
other documents to be delivered by Buyer pursuant to this Agreement have been
duly executed and delivered (or, in the case of any such documents to be
executed and delivered at Closing, when executed and delivered will be duly
executed and delivered) and constitute (or, in the case of any such documents to
be executed and delivered at Closing, when executed and delivered will
constitute) the valid and legally binding obligation of Buyer, enforceable
against it in accordance with its terms and conditions. Except for any notices
that may be required pursuant to the HSR Act or as otherwise set forth on
Schedule 4.2, Buyer does not need to give any notice to, make any filing with,
or obtain any authorization, consent, or approval of any Governmental Authority
or other third party in order to consummate the transactions contemplated by
this Agreement and the agreements contemplated hereby in a lawful manner and
without causing a default under, conflict with, or acceleration, violation or
termination of any material legal requirement or material contract or agreement
to which the Buyer is a party or bound.
Section 4.3 Noncontravention. Except for any notices that may be required
pursuant to the HSR Act or as otherwise set forth on Schedule 4.2, neither the
execution and delivery by Buyer of this Agreement and the agreements
contemplated hereby, nor the consummation of the transactions contemplated
hereby and thereby by Buyer, will (A) violate any material statute, regulation,
rule, injunction, judgment, order, decree, ruling, charge, or other restriction
of any Governmental Authority to which Buyer is subject or any provision of its
certificate of incorporation or bylaws or (B) conflict with, result in a breach
of, constitute a default under, result in the acceleration of, create in any
party the right to accelerate, terminate, modify, or cancel, or require any
notice under any material agreement, contract, lease, license, instrument, or
other arrangement to which Buyer is a party or by which it is bound or to which
any of its assets is subject.
Section 4.4 Brokers' Fees. Buyer has no liability or obligation to pay any fees
or commissions to any broker, finder or agent with respect to the transactions
contemplated by this Agreement except for the broker fee payable to
Communications Equity Associates.
Section 4.5 Investment. Buyer (A) understands that the Shares, if any, have not
been, and will not be, registered under the Securities Act, or under any state
securities laws, and are being offered and sold in reliance upon federal and
state exemptions for transactions not involving any public offering, (B) is
acquiring the Shares solely for its own account for investment purposes and not
with a view to the distribution thereof, within the meaning of the Securities
Act, (C) is a sophisticated investor with knowledge and experience in business
and
-8-
15
financial matters, (D) has received certain information concerning Seller
and the Company and has had the opportunity to obtain additional information as
desired in order to evaluate the merits and the risks inherent in holding the
Shares, (E) is able to bear the economic risk and lack of liquidity inherent in
holding the Shares, and (F) is an Accredited Investor.
Section 4.6 SEC Filings. Buyer's filings with the Securities and Exchange
Commission (the "SEC") did not at the time they were filed contain any untrue
statement of a material fact or omit to state any material fact required to be
stated or necessary in order to make the statements made in those reports, in
light of the circumstances under which they were made, not misleading.
Section 4.7 Disclosure. The representations and warranties contained in this
Article 4 do not contain any untrue statement of a material fact or omit to
state any material fact necessary in order to make the statements and
information contained in this Article 4 not misleading.
ARTICLE 5
REPRESENTATIONS AND WARRANTIES OF SELLER CONCERNING THE COMPANY
Seller represents and warrants to Buyer that the statements contained
in this Article 5 are true, correct and complete as of the date of this
Agreement.
Section 5.1 Organization, Qualification, and Corporate Power. The Company is a
corporation duly organized, validly existing, and in good standing under the
laws of the Commonwealth of Pennsylvania. The Company is duly authorized to
conduct business and is in good standing under the laws of the jurisdictions set
forth on Schedule 5.1. There are no jurisdictions where failure of the Company
to be so qualified would have a Material Adverse Effect. The Company has full
power and authority necessary to carry on the businesses in which it is engaged
and to own and use the properties owned and used by it. Schedule 5.1 lists the
directors and officers of the Company. Seller has delivered, or made available
on November 17, 1999 in the due diligence data room located at Xxxxxxxxxxxx Xxxx
& Xxxxxxxxx'x Washington, D.C. offices, to Buyer correct and complete copies of
the articles of incorporation and bylaws of the Company (as amended to date) and
complete copies of the minute books (containing the records of meetings of the
stockholders, the board of directors and any committees of the board of
directors) for the period since September 19, 1997 and has afforded Buyer the
opportunity to inspect the minute books in the possession of Seller or the
Company for the period prior to September 19, 1997, the stock certificate books
and the stock record books of the Company. The Company is not in default under
or in violation of any provision of its articles of incorporation or bylaws.
Section 5.2 Capitalization. The entire authorized capital stock of the Company
consists of 1,000,000 shares of common stock, par value $1.00 per share, of
which 100 shares are issued and outstanding and held by Seller (and no shares
are held in treasury) and 1,000,000 shares of preferred stock, par value $0.10,
none of which is issued and outstanding. Other than as set forth in the
preceding sentence, there are no authorized or issued and outstanding capital
-9-
16
stock or other securities of the Company. All of the Shares have been duly
authorized, are validly issued, fully paid and nonassessable, not subject to
preemptive rights and held of record and beneficially by Seller. All of the
Shares were issued in accordance with all applicable securities laws. There are
no outstanding or authorized options, warrants, purchase rights, redemption
rights, subscription rights, conversion rights, exchange rights or other
contracts or commitments of any character that could require the Company to
issue, sell or otherwise cause to become outstanding any of its capital stock.
There are no outstanding or authorized stock appreciation, phantom stock, profit
participation or similar rights with respect to the Company. There are no voting
trusts, proxies or other agreements or understandings with respect to the voting
of the capital stock of the Company or otherwise relating to the capital stock
of the Company.
Section 5.3 Noncontravention; Consents. Except for notices that may be required
pursuant to the HSR Act or as otherwise set forth in Schedule 5.3, neither the
execution and the delivery of this Agreement and the agreements contemplated
hereby by Seller, nor the consummation of the transactions contemplated hereby
and thereby by Seller, will (i) violate any material statute, regulation, rule,
injunction, judgment, order, decree, ruling, charge or other restriction of any
Governmental Authority to which the Company is subject or any provision of the
articles of incorporation or bylaws or other similar governing instrument of the
Company or (ii) conflict with, result in a breach of, constitute a default
under, result in the acceleration of, create in any party the right to
accelerate, terminate, modify or cancel, or require any notice under any
material agreement, contract, lease, license, instrument or other arrangement to
which the Company is a party or by which it is bound or to which any of its
assets is subject or result in the imposition of any Lien upon any of its
assets. Except as set forth in Schedule 5.3, the Company does not need to give
any notice to, make any filing with, or obtain any authorization, consent or
approval of any Governmental Authority or other third party in order for the
parties hereto to consummate the transactions contemplated by this Agreement in
a lawful manner and without causing a default under, conflict with, or
acceleration, violation or termination of, any material legal requirement or
material contract or agreement to which the Company is a party or bound.
Section 5.4 Brokers' Fees. The Company does not have any liability or obligation
to pay any fees or commissions to any broker, finder, or agent with respect to
the transactions contemplated by this Agreement.
Section 5.5 Title to Assets. The Company has good and marketable title to, or a
valid leasehold interest in, the personal properties and assets used by it,
located on its premises, as shown on the Most Recent Balance Sheet or acquired
after the date thereof, free and clear of all Liens, except for (i) liens for
current taxes not yet due and payable or which are being contested in good faith
by appropriate proceedings and with respect to which appropriate reserves are
being maintained in accordance with GAAP, (ii) inchoate materialmen's,
mechanics', workmen's and repairmen's liens incurred in the Ordinary Course of
Business which are not yet due, (iii) easements and rights of way which do not
materially adversely affect the marketability or use or value of the applicable
parcel of real estate as presently used, and (iv) the Liens set forth in
Schedule 5.5 which shall be removed when indicated in Schedule 5.5 at or prior
to Closing (the "Permitted Liens").
-10-
17
Section 5.6 Subsidiaries and Investments. The Company has no direct or indirect
Subsidiaries. The Company does not control directly or indirectly or have any
direct or indirect equity participation in any Person.
Section 5.7 Financial Statements. Attached hereto as Schedule 5.7 are the
following financial statements (collectively the "Financial Statements"): (i)
audited balance sheets and statements of income, changes in stockholders' equity
and cash flow as of and for the fiscal years ended December 31, 1998 (the "Most
Recent Fiscal Year End") and for the period beginning September 19, 1997 and
ending December 31, 1997, for the Company; and (ii) unaudited balance sheets and
statements of income, changes in stockholders' equity and cash flow (the "Most
Recent Financial Statements") as of and for the ten month period ended October
31, 1999 (the "Most Recent Fiscal Month End") for the Company. The Financial
Statements (including the notes thereto) have been prepared in accordance with
GAAP applied on a consistent basis throughout the periods covered thereby,
present fairly the financial condition of the Company as of such dates and the
results of operations of the Company for such periods, are correct and complete
in all material respects, and are consistent with the books and records of the
Company (which books and records are correct and complete).
Section 5.8 Events Subsequent to Most Recent Fiscal Year End. Since the Most
Recent Fiscal Year End, no Material Adverse Effect has occurred. Without
limiting the generality of the foregoing, since that date, except as set forth
on Schedule 5.8:
(i) The Company has not sold, leased, transferred, or assigned any of its
assets, tangible or intangible, which are necessary for the operation of the
Business, other than for a fair consideration in the Ordinary Course of
Business;
(ii) The Company has not issued any note, bond or other debt security or
created, incurred, assumed or guaranteed any indebtedness for borrowed money or
capitalized lease obligation;
(iii) The Company has not declared, set aside or paid any dividend or made any
distribution with respect to its capital stock or other equity interest (whether
in cash or in kind) or redeemed, purchased, or otherwise acquired any of its
capital stock or other equity;
(iv) The Company has not made any loan or advance to or made any distribution
to, or entered into any other transaction with, any of its directors, officers
or employees or with Seller or any of its Affiliates; and
(v) The Company has not committed to any of the foregoing.
Section 5.9 Undisclosed Liabilities. Except as set forth on Schedule 5.9, the
Company does not have any Liability, except for (i) Liabilities set forth on the
face of the Most Recent Balance Sheet and (ii) Liabilities which have arisen
after the date of the Most Recent Balance Sheet in the Ordinary Course of
Business (none of which results from, arises out of, relates to, is in the
nature of or was caused by any breach of contract, breach of warranty, tort,
infringement or violation of law) (such Liabilities that are either set forth on
Schedule 5.9 or covered by clauses (i) or (ii) above are referred to as
"Disclosed Liabilities" and all other Liabilities of the Company are referred to
as "Undisclosed Liabilities"). Schedule 5.9 lists all
-11-
18
capitalized lease or similar obligations of the Company. The Company is
not liable for any other indebtedness (including indebtedness for borrowed
money and purchase money financing arrangements).
Section 5.10 Legal Compliance. The Company has complied in all material respects
with all applicable laws (including rules, regulations, codes, plans,
injunctions, judgments, orders, decrees, rulings, and charges thereunder) of all
Governmental Authorities, and to the Knowledge of Seller, no action, suit,
proceeding, hearing, investigation, charge, complaint, claim, demand, or notice
has been filed or commenced against the Company alleging any failure so to
comply. To the Knowledge of Seller, the Company is not subject to FAA or FCC
licensing requirements or other rules and regulations.
Section 5.11 Tax Matters.
(a) The Company has (i) duly filed or caused to be filed in a timely manner all
Tax Returns that it was required to file with the appropriate Governmental
Authorities, and (ii) paid or made adequate provision in the Financial
Statements in accordance with GAAP for the payment of all Taxes owed by the
Company for all taxable periods or portions thereof through the Closing Date.
All of the Tax Returns referred to in clause (i) above are true, correct and
complete in all material respects. The Company 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.
(b) The Company has not executed any waiver or extension of any statute of
limitations on the assessment or collection of any Tax of the Company or with
respect to any liability arising therefrom. None of the Tax Returns filed by or
on behalf of the Company is currently being audited by any Governmental
Authority, and there are no other examinations, requests for information or
other administrative or judicial proceedings pending with respect to Taxes of
the Company. Neither the Internal Revenue Service nor any other Governmental
Authority has asserted any deficiency or claim for additional Taxes against, or
any adjustment of Taxes relating to, the Company. No claim has been made in
writing by any Governmental Authority in a jurisdiction where the Company does
not file Tax Returns that it is or may be subject to taxation by that
jurisdiction.
(c) Schedule 5.11 lists, for the Company, all jurisdictions in which it is
required to file a state Tax Return and indicates, for each such jurisdiction,
whether it files a consolidated, combined or unitary Tax Return with another
entity.
(d) Seller has delivered to Buyer: (i) true, correct and
complete copies of all Tax Returns filed by or on behalf of the Company with
respect to taxable periods ending on or after December 31, 1996, and all backup
schedules and work papers related thereto, and (ii) all examination reports and
statements of deficiency asserted against or agreed to by or on behalf of the
Company with respect to Taxes since January 1, 1996.
(e) There are no proposed reassessments of any property owned
by the Company that would affect the Taxes of the Company after the Closing
Date. There are no Tax liens on any assets of the Company, other than liens for
current Taxes not yet due and payable.
-12-
19
(f) Except as set forth on Schedule 5.11(f), the Company has
no liability for the Taxes of any Person (other than the Company) pursuant to
Section 1.1502-6 of the Treasury Regulations promulgated under the Code (the
"Treasury Regulations"), any comparable provisions of any state, local or
foreign Tax law in respect of a consolidated, combined or unitary Tax Return, or
by contract or otherwise. As of the Closing, there will be no tax sharing
agreements or similar arrangements in effect with respect to or involving the
Company.
(g) No consent under Section 341(f) of the Code has been
filed with respect to the Company.
(h) The Company does not have (i) any income or gain
reportable for a period ending after the Closing Date but attributable to a
transaction (e.g., an installment sale) occurring in, or a change in accounting
method made for, a taxable period ending on or prior to the Closing Date which
resulted in a deferred reporting of income or gain from such transaction or from
such change in accounting method, (ii) any income or gain that has been deferred
as a result of having arisen out of any "intercompany transaction," within the
meaning of Section 1.1502-13(b) of the Treasury Regulations, or (iii) any
"excess loss account," within the meaning of Section 1.1502-19(a) of the
Treasury Regulations, in the stock of any Subsidiary.
(i) The Company has not been a "United States real property
holding corporation," within the meaning of Section 897(c)(2) of the Code during
the applicable period specified in Section 897(c)(1)(A)(ii) of the Code.
(j) The Company has not entered into any compensatory
agreements with respect to the performance of services which payment thereunder
would result in a non-deductible expense to the Company pursuant to Section 280G
of the Code.
Section 5.12 Governmental Licenses. Schedule 5.12 sets forth a list of all
material Governmental Licenses of the Company together with all amendments and
modifications thereto and all applications relating thereto (such Governmental
Licenses, the "Material Governmental Licenses"). The Material Governmental
Licenses constitute all of the licenses, permits and authorizations necessary to
conduct the business of the Company as currently operated in compliance in all
material respects with all laws, rules and regulations of all Governmental
Authorities. The Company is in compliance in all material respects with all of
the requirements of the Material Governmental Licenses. All of the Material
Governmental Licenses are valid and in full force and effect and no suspension,
cancellation or termination of any of the Material Governmental Licenses is
pending or, to the Knowledge of Seller, threatened. Except as set forth on
Schedule 5.12 and based solely on the terms of such Material Governmental
License, each Material Governmental License will continue to be valid and in
full force and effect on identical terms following the consummation of the
transactions contemplated hereby.
Section 5.13 Real Property. Schedule 5.13 lists all of the Real Property.
------------- -------------
(a) As of the Closing Date the Company will have good and marketable title to
the parcel of Real Property located in Pine Forge, Pennsylvania, free and clear
of any Liens, except for Permitted Liens;
-13-
20
(b) With respect to any leased Real Property, the Company has a valid leasehold
interest to such parcel of Real Property, free and clear of any Liens other than
Permitted Liens, and assuming compliance by the Company with the terms of the
lease, the Company has a right of quiet enjoyment of such parcel of Real
Property;
(c) There are no pending or, to the Knowledge of Seller, threatened condemnation
proceedings, lawsuits or administrative actions relating to the Real Property or
other matters affecting adversely the current use, occupancy, or value thereof;
(d) To Seller's belief, the legal description for the Pine Forge parcel
contained in the deed transferring such parcel to the Company will describe such
parcel fully and adequately, the buildings and improvements are located within
the boundary lines of the described parcels of land, are not in violation of
applicable setback requirements, zoning laws and ordinances (and none of the
properties or buildings or improvements thereon are subject to "permitted
non-conforming use" or "permitted non-conforming structure" classifications),
and do not encroach on any easement which may burden the land, and the land does
not serve any adjoining property for any purpose inconsistent with the use of
the land, and the property is not located within any flood plain or subject to
any similar type restriction for which any permits or licenses necessary to the
use thereof have not been obtained;
(e) Other than as disclosed on Schedule 5.13, there are no leases, subleases,
licenses, concessions or other agreements, written or oral, granting to any
party or parties the right of use or occupancy of any portion of such parcel of
Real Property other than the Company;
(f) With respect to the Pine Forge Real Property, there are no outstanding
options or rights of first refusal to purchase such parcel of Real Property, or
any portion thereof or interest therein;
(g) Other than as disclosed on Schedule 5.13, as of the Closing Date, there will
not be any parties (other than the Company) in possession of the Company's Real
Property;
(h) To Seller's belief: all facilities located on the Company's Real Property
are supplied with utilities and other services necessary for the operation of
such facilities, including gas, electricity, water, telephone, sanitary sewer
and storm sewer, all of which services are adequate in accordance with all
applicable laws, ordinances, rules and regulations and are provided via public
roads or via permanent, irrevocable, appurtenant easements benefiting such
parcel of real property, the facilities are in good order and repair, and in a
good, safe, substantial condition, free from material defects; all plumbing,
heating, electrical and air conditioning systems and equipment and systems
therein are in good order and repair and operating condition; the facilities are
constructed and completed strictly in compliance with all applicable laws and
accepted standards of good materials and workmanship, all electrical, plumbing,
heating and air-conditioning and exterior drainage systems, in or on the Real
Property are in good condition and working order;
(i) To Seller's belief, all owned Real Property abuts on and has direct
vehicular access to a public road, or has access to a public road via a
permanent, irrevocable,
-14-
21
appurtenant easement benefiting the parcel of real property, and access to
the property is provided by paved public right-of-way with adequate curb cuts
available;
(j) Seller has delivered to Buyer true and complete copies of any deed or lease
for the Real Property showing the current holder of such Real Property; and
(k) The Company does not own or hold title to any of the
parcels of real property located at the former corporate headquarters in North
Wales, Pennsylvania.
Section 5.14 Intellectual Property. Except as set forth on Schedule 5.14, the
Company owns or has the right to use pursuant to license, sublicense, agreement
or permission all Intellectual Property necessary for the operation of the
business of the Company as presently conducted. To the Knowledge of Seller, the
Company has not interfered with, infringed upon, misappropriated, or otherwise
come into conflict with any Intellectual Property rights of third parties, and
the Company has not received any complaint, claim, demand or notice alleging any
such interference, infringement, misappropriation or violation (including any
claim that the Company must license or refrain from using any Intellectual
Property rights of any third party). To the Knowledge of Seller, no third party
has interfered with, infringed upon, misappropriated or otherwise come into
conflict with any Intellectual Property rights of the Company. Schedule 5.14
identifies all registered or registrable Intellectual Property of the Company
and each pending application therefor and identifies each license, agreement or
other permission which the Company has granted to any third party with respect
to any of its Intellectual Property.
Section 5.15 Tangible Assets. The Company owns or leases all buildings,
machinery, equipment and other tangible assets necessary for the conduct of the
Business as presently conducted. The tangible assets are in a condition which is
reasonably satisfactory for the present operation of the Business. Schedule 5.15
sets forth a list of all items of tangible assets of the Company, including the
location thereof, having a book value of $25,000 or more.
Section 5.16 Contracts. Schedule 5.16 contains a true and complete list of all
Contracts for the construction of towers which have not been completed or which
have continuing obligations (including but not limited to indemnification or
warranty obligations), any executory Contract which involves expenditures or
receivables of more than $50,000 and any executory Contract which cannot be
terminated or completed within one (1) year from the Closing Date for less than
$10,000 ("Material Contracts"). Seller has delivered, or made available on
November 17, 1999 in the due diligence data room located at Xxxxxxxxxxxx Xxxx &
Xxxxxxxxx'x Washington, D.C. offices, to Buyer a correct and complete copy of
each written Material Contract (as amended to date) and a written summary
setting forth the terms and conditions of each oral Material Contract. Each
Material Contract is legal, valid, binding, enforceable against the Company and,
to the Knowledge of Seller, each other party thereto, and in full force and
effect in accordance with its terms. Each Material Contract will continue to be
legal, valid, binding, enforceable and in full force and effect on identical
terms following the consummation of the transactions contemplated hereby.
Neither the Company, nor to the Knowledge of Seller, any other party thereto is
in material breach or default under any Material Contract, and to the Knowledge
of Seller, no event has occurred which with notice or lapse of time would
constitute a breach or default under any Material Contract, or permit
termination, modification or acceleration, or reduce the amount of payments due
the Company, or give rise to
-15-
22
any liquidated damages, under any Material Contract. No party to any
Material Contract has repudiated any provision of such Contract.
Section 5.17 Notes and Accounts Receivable; Accounts Payable. All notes,
accounts receivable (except intercompany accounts that are being cancelled
pursuant to Section 6.17 hereof), unbilled work in process and other debts due
of the Company are reflected properly on their books and records, are valid
receivables subject to no setoffs or counterclaims, are current and collectible,
and will be collected in accordance with their terms at their recorded amounts,
subject only to the reserve for bad debts set forth on the face of the Most
Recent Balance Sheet. Since September 19, 1997, the Company has paid on a timely
basis all of their accounts payable and such accounts payable arose in the
Ordinary Course of Business.
Section 5.18 Powers of Attorney . Schedule 5.18 lists all outstanding
powers of attorney executed on behalf of the Company.
Section 5.19 Insurance. Schedule 5.19 sets forth the following information with
respect to each insurance policy (including policies providing property,
casualty, liability, and workers' compensation coverage and bond and surety
arrangements) to which the Company is a party, a named insured, or otherwise the
beneficiary of coverage:
(a) the name of the insurer, the name of the policyholder and the name of
each covered insured;
(b) the policy number and the period of coverage;
(c) the scope (including an indication of whether the coverage was on a claims
made, occurrence or other basis) and amount (including a description of how
deductibles and ceilings are calculated and operate) of coverage; and
(d) a description of any retroactive premium adjustments or other loss-sharing
arrangements.
With respect to each such insurance policy: (A) the policy is legal, valid,
binding, enforceable and in full force and effect; (B) based solely on the terms
of the policy, the policy will continue to be legal, valid, binding, enforceable
and in full force and effect on identical terms following the consummation of
the transactions contemplated hereby; (C) neither the Company nor, to the
Knowledge of Seller, any other party to the policy is in breach or default
thereunder (including with respect to the payment of premiums or the giving of
notices), and to the Knowledge of Seller, no event has occurred which, with
notice or the lapse of time, would constitute such a breach or default, or
permit termination, modification or acceleration, under the policy; and (D) to
the Knowledge of Seller, no party to the policy has repudiated any provision
thereof. The Company has been covered since September 19, 1997 by insurance in
scope and amount, which, to Seller's good faith belief, is customary and
reasonable for the businesses in which it has engaged during such period.
Schedule 5.19 describes any self-insurance arrangements affecting the Company.
Since September 19, 1997, except as set forth on Schedule 5.19, the Company has
not been subject to, nor has any insurer defended or settled, on behalf of the
Company or paid out money on behalf of the Company with respect to any workers'
compensation claim or any claim under any insurance policy where the aggregate
amount at issue exceeded $10,000.
-16-
23
Section 5.20 Litigation. Schedule 5.20 sets forth each instance in which the
Company (i) is subject to any outstanding injunction, judgment, order, decree,
ruling or charge or (ii) is a party to or, to the Knowledge of Seller, is
threatened to be made a party to any action, suit, proceeding, hearing or
investigation of, in or before any court or quasi-judicial or administrative
agency of any federal, state, local, or foreign jurisdiction or before any
arbitrator.
Section 5.21 Employees.
(a) Schedule 5.21 contains a correct and complete list of (i)
the names and positions of each of the employees, officers and directors of the
Company and of each employee of the Seller or any affiliate of the Seller whose
services relate primarily to the Business, (ii) the annual salary or hourly wage
of each such person, and (iii) any oral or written contracts or agreements that
provide for employment of any individual as an employee or independent
contractor of the Company and which does not permit the termination of such
contract or agreement, without penalty, upon no more than 30 days prior notice.
Seller has provided to Buyer correct and complete copies (or descriptions, if
oral) of all contracts or agreements listed in Schedule 5.21.
(b) No employees of the Company are presently members of any
collective bargaining unit with respect to their employment with the Company.
There are no collective bargaining agreements and no contracts or agreements
with labor unions, relating to, involving or affecting the employees of any of
the Company to which the Company is a party or by which it is bound, and the
Company has no obligation to bargain with any labor organization with respect to
any such persons. The Company is not currently, nor since September 19, 1997,
has it been, the subject of any certification or decertification drive, and, to
the Knowledge of Seller, no such organizing activity is threatened. To the
Knowledge of Seller, no union or other collective bargaining representative
claims to represent, has been certified as representing or has requested that
the Company recognize such union or collective bargaining representative as
representing any of the employees of the Company for collective bargaining
purposes. Neither Seller nor the Company has recognized or agreed to recognize
or is required to recognize any union as the collective bargaining
representative for any employee of the Company.
(c) There are no unfair labor practice charges pending against
the Company and, to the Knowledge of Seller, there are neither any demands for
recognition or any other requests or demands from a labor organization for
representative status with respect to any persons employed by the Company and no
such activity is threatened. Neither the Company nor the Business is currently,
or since September 19, 1997, has been, the subject of any strike, work stoppage,
picketing or work slowdown, or any other labor dispute, controversy or
proceeding, and to the Knowledge of Seller, no such activity is threatened. The
Company has complied in all material respects with all laws relating to the
employment and safety of labor, including provisions relating to wages, hours,
benefits, collective bargaining, discrimination, the payment of social security
and other payroll expenses, and all applicable occupational safety and health
acts, laws and regulations. The Company is not subject to any investigation or
other challenge relating to the misclassification of employees as independent
contractors. The Company is not required to comply with any government
contractor affirmative action obligations.
-17-
24
Section 5.22 Employee Benefits.
(a) Each Employee Plan and Compensation Arrangement is listed and described in
Schedule 5.22, and complete and accurate copies of (including any amendments to)
any such written Employee Plans and Compensation Arrangements (or related
insurance policies) have been furnished, or made available on November 17, 1999
in the due diligence data room located at Xxxxxxxxxxxx Xxxx & Xxxxxxxxx'x
Washington, D.C. offices, to Buyer along with copies of any employee handbooks
or similar documents describing such Employee Plans and Compensation
Arrangements. Any unwritten Employee Plans or Compensation Arrangements also are
listed in Schedule 5.22, and complete descriptions have been furnished to Buyer.
Except as disclosed in Schedule 5.22, neither Seller nor the Company is a party
to and does not have in effect or to become effective after the date of this
Agreement any plan, arrangement or other scheme which will become an Employee
Plan or Compensation Arrangement (including any bonus, cash or deferred
compensation, severance, medical, pension, profit sharing or thrift, stock
option, employee stock ownership, life or group insurance, death benefit,
vacation, sick leave, disability or trust agreement or arrangement), or any
amendment to an Employee Plan or Compensation Arrangement. Except for the
participation by Bend Broadcasting, LLC in the Stainless, Inc. 401(k) Savings
Plan, no Employee Plan or Compensation Arrangement is sponsored by, maintained
by or contributed to by any ERISA Affiliate, and no Employee Plan or
Compensation Arrangement provides benefits to the employees, former employees or
independent contractors of any ERISA Affiliate with respect to services
performed for the ERISA Affiliate by such employees, former employees or
independent contractors
(b) Seller has furnished to Buyer the Forms 5500 filed for each of the Employee
Plans (including all attachments and schedules), actuarial reports, summaries of
material modifications, summary annual reports, and any other employer notices
(including, governmental filings and descriptions of material changes to
Employee Plans or Compensation Arrangements) relating to the Employee Plans for
the last three plan years, and the current summary plan descriptions.
(c) Except as set forth in Schedule 5.22, each Employee Plan and Compensation
Arrangement has been administered in compliance with its own terms and in
material compliance with the provisions of ERISA, the Code, the Age
Discrimination in Employment Act and any other applicable Federal or state laws.
(d) Neither the Company nor any ERISA Affiliate is contributing to, is required
to contribute to, or has contributed within the last five years to, any
Multiemployer Plan or Multiple Employer Plan, and neither the Company nor any
ERISA Affiliate has incurred within the last five years, or reasonably expects
to incur, any "withdrawal liability," as defined under Section 4201 et seq. of
ERISA. Neither the Company nor any ERISA Affiliate has terminated within the
last five years an employee pension benefit plan, as defined under Section 3(2)
of ERISA, which was subject to Title IV of ERISA. Neither the Company nor any
ERISA Affiliate has ever engaged in a transaction to evade liability, as
described under Section 4069 of ERISA.
-18-
25
(e) At all times on or prior to the Closing, each Employee Plan, to the extent
such Employee Plan is intended to be tax-qualified, satisfies all minimum
coverage and minimum participation requirements, if any, imposed on such
Employee Plan by the applicable terms of the Code and ERISA.
(f) Neither Seller nor the Company is aware of the existence of any governmental
inspection, investigation, audit or examination of any Employee Plan or
Compensation Arrangement or of any facts which would lead them to believe that
any such governmental inspection, investigation, audit or examination is pending
or threatened. There exists no action, suit or claim (other than routine claims
for benefits) with respect to any Employee Plan or Compensation Arrangement
pending or, to the Knowledge of Seller, threatened against any of such plan or
arrangement, and neither Seller nor the Company possesses any knowledge of any
facts which could give rise to any such action, suit or claim.
(g) Neither the Company nor any ERISA Affiliate sponsors, maintains or
contributes to any Employee Plan or Compensation Arrangement that provides
medical benefit coverage to former employees of the Company, except to the
extent required by Section 4980B of the Code. Except as described in Schedule
5.22, neither the Company nor any ERISA Affiliate sponsors, maintains or
contributes to any Employee Plan or Compensation Arrangement that provides death
benefit coverage to former employees of the Company. To the extent any Employee
Plan or Compensation Arrangement provides death benefit coverage to former
employees of the Company, the benefits provided thereunder are fully insured and
have been provided in compliance with the applicable group term life insurance
policy.
(h) Except as described in Schedule 5.22, with respect to each Employee Plan
and, to the extent applicable, each Compensation Arrangement: (i) each Employee
Plan that is intended to be tax-qualified, and each amendment thereto, is the
subject of a favorable determination letter, and no plan amendment that is not
the subject of a favorable determination letter would affect the validity of an
Employee Plan's letter; (ii) no condition or event exists or is expected to
occur that could subject, directly or indirectly, the Company, Seller or any
ERISA Affiliate to any material liability, contingent or otherwise, or the
imposition of any Lien on the assets of the Company, Seller or any ERISA
Affiliate under the Code or Title IV of ERISA whether to the PBGC, the Internal
Revenue Service, or any other person; (iii) no Employee Plan is subject to
Section 302 or Title IV of ERISA; (iv) no Prohibited Transaction has occurred
which would subject the Company or any ERISA Affiliate to any liability; (v)
which provides severance or severance like benefits may be terminated by the
Company without any penalty and without any liability to pay severance benefits
in connection with any terminations of employment which occur after the date
such Employee Plan or Compensation Arrangement is terminated; (vi) which is a
"group health plan," as defined under Section 601 et seq of ERISA and 4980B of
the Code ("COBRA"), has provided "continuation coverage" to each "covered
employee" and "qualified beneficiary" entitled thereto (with each term as
defined under COBRA); and (vii) all contributions, premiums, payments or
liabilities accrued, in whole or in part, under each Employee Plan or
Compensation Arrangement or with respect thereto as of the Closing will be paid
by the Company or Seller, on or prior to Closing or shall be reflected on the
financial statements of the Company or Seller as of Closing and shall be paid
within the time period permitted by ERISA and the Code.
-19-
26
(i) Neither the execution and delivery of this Agreement nor the consummation of
the transactions contemplated hereby will (i) result in any material payment
(including, without limitation, severance, or unemployment compensation)
becoming due to any director or employee of the Company; (ii) result in the
acceleration of vesting under any Employee Plan or Compensation Arrangement; or
(iii) materially increase any benefits otherwise payable under any Employee
Plan; and any such payment or increase in benefits is fully deductible under the
Code, including but not limited to Sections 162, 280G and 404 of the Code.
Section 5.23 Guaranties. Except for guaranties that are disclosed on Schedule
5.23 and that will be terminated prior to Closing, the Company is not a
guarantor or otherwise liable for any Liability or obligation (including
indebtedness) of any other Person.
Section 5.24 Environmental, Health and Safety Matters. Except as set forth on
Schedule 5.24 and except for any matter relating to the real property,
facilities or operations at Perkasie, Pennsylvania or the property in North
Wales, Pennsylvania owned by SEPA:
(a) The Company has complied in all material respects and is in compliance in
all material respects with all Environmental, Health and Safety Requirements and
to Seller's Knowledge, each predecessor of the Company has complied in all
material respects with all Environmental, Health and Safety Requirements.
(b) Without limiting the generality of the foregoing, the Company has obtained
and complied with, and is in compliance with, in all material respects all
permits, licenses and other authorizations that are required pursuant to
Environmental, Health and Safety Requirements for the occupation of its
facilities and the operation of its business.
(c) The Company has not received any written or oral notice, report or other
information regarding any actual or alleged violation of Environmental, Health
and Safety Requirements or any Liability, including any investigatory, remedial
or corrective obligations, relating to any of them or its facilities arising
under Environmental, Health and Safety Requirements.
(d) To the Knowledge of Seller, none of the following exists at any property or
facility owned or operated by the Company: (i) underground storage tanks, (ii)
asbestos-containing material in any form or condition, (iii) materials or
equipment containing polychlorinated biphenyls, or (iv) landfills, surface
impoundments or regulated treatment, storage or disposal areas.
(e) None of the Company, or to Seller's Knowledge, the Company's predecessors
has treated, stored, disposed of, arranged for or permitted the disposal of,
transported, handled or released any substance, including any hazardous
substance, or owned or operated any property or facility (and no such property
or facility is contaminated by any such substance) in a manner that has given or
could reasonably be expected to give rise to material liabilities of the
Company, including any such liability for response costs, corrective action
costs, personal injury, property damage, natural resources damages or attorney
fees, pursuant to the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended
-20-
27
("CERCLA"), the Solid Waste Disposal Act, as amended ("SWDA") or any other
Environmental, Health and Safety Requirements.
(f) Neither this Agreement nor the consummation of the transaction that is the
subject of this Agreement will result in any obligations for site investigation
or cleanup, or notification to or consent of any Government Authorities or third
parties, pursuant to any of the so-called "transaction-triggered" or
"responsible property transfer" Environmental, Health and Safety Requirements.
(g) The Company has not, either expressly or by operation of law, assumed or
undertaken any material liability, including any obligation for corrective or
remedial action, of any other Person relating to Environmental, Health and
Safety Requirements.
Section 5.25 Certain Business Relationships with the Company and Its Affiliates.
Except as set forth in Schedule 5.25, neither Seller nor any Affiliate thereof
or of the Company has been involved in any business arrangement or relationship
with the Company within the past 12 months, and, except for the Pine Forge
property to be conveyed to the Company prior to Closing pursuant to Section
6.15(c), neither Seller nor any Affiliate thereof or of the Company owns or has
any right to use any asset, tangible or intangible, which is used in the
Business. There are no tax sharing agreements between the Company and Seller or
any of Seller's Affiliates.
Section 5.26 Bank Accounts and Credits . Schedule 5.26 lists all banks and
lending institutions with which the Company maintains any account or has a
credit facility, and sets forth the names of all individuals who have signing
authority for any such account.
Section 5.27 Inventory. The inventory of the Company consists of raw materials
and supplies, manufactured and purchased parts, goods in process and finished
goods, all of which is merchantable and fit for the purpose for which it was
procured or manufactured, and none of which is slow-moving, obsolete, damaged or
defective, subject only to the reserve for inventory writedown set forth on the
face of the Most Recent Financial Statements as adjusted for the passage of time
through the Closing Date in accordance with the past custom and practice of the
Company.
Section 5.28 Product and Service Warranty. Each product manufactured, sold,
leased or delivered, and each service performed, by the Company has been in
conformity in all material respects with all applicable contractual commitments
and all express and implied warranties, and the Company has no Liability for
replacement or repair thereof or other damages in connection therewith, subject
only to the reserve for product warranty claims set forth on the face of the
Most Recent Financial Statements as adjusted for the passage of time through the
Closing Date in accordance with the past custom and practice of the Company. No
product manufactured, sold, leased or delivered, and no service performed, by
the Company is subject to any guaranty, warranty or other indemnity beyond the
applicable standard terms and conditions of sale, lease or service. Schedule
5.28 includes copies of the standard terms and conditions of sale and service
for the Company (containing applicable guaranty, warranty, and indemnity
provisions).
-21-
28
Section 5.29 Year 2000 Compliance. Schedule 5.29 lists each of the computer
software programs, hardware, databases and embedded control systems used by the
Company (the "Systems") and describes the status of such Systems regarding their
ability (a) to accurately process time data (including calculating, comparing
and sequencing) from, into and between the twentieth and twenty-first centuries,
the years 1999 and 2000, and leap year calculations and (b) operate accurately
with other software and hardware that use standard format (4 digits) for
representation of the year.
Section 5.30 Disclosure. The representations and warranties contained in this
Article 5 do not contain any untrue statement of a material fact or omit to
state any material fact necessary in order to make the statements and
information contained in this Article 5 not misleading.
ARTICLE 6
COVENANTS
Section 6.1 Conduct of Business of the Company. Except as contemplated by this
Agreement or with the prior written consent of Buyer, during the period from the
date of this Agreement to the Closing, Seller shall cause the Company to conduct
its operations only in the Ordinary Course of Business consistent with past
practice, and Seller will use its reasonable best efforts to, and will cause the
Company to, preserve intact the business and organization of the Company, to
keep available the services of the present officers and key employees of the
Company, and to preserve the good will of customers, suppliers and all other
persons having business relationships with the Company.
(a) Except as otherwise contemplated by this Agreement, prior to the Closing,
Seller shall not permit the Company to, without the prior written consent of
Buyer:
(i) adopt any amendment to the articles of incorporation or bylaws of the
Company;
(ii) issue, reissue or sell, or authorize the issuance, reissuance or sale of
any additional shares or other equity interest in the Company or securities
convertible into any rights, warrants or options to acquire any additional
shares or other equity interest in the Company;
(iii) declare, set aside or pay any dividend or make any other distribution
(whether in cash, securities or property or any combination thereof) other than
as provided in Section 6.15 of this Agreement or pay any obligations or
Liabilities of the Company other than in the Ordinary Course of Business;
(iv) split, combine, subdivide, reclassify or redeem, purchase or otherwise
acquire, or propose to redeem or purchase or otherwise acquire, any of its
shares or other equity interest;
(v) increase the compensation or fringe benefits payable or to become payable to
its directors, officers or employees, or pay any benefit not required by any
existing
-22-
29
Employee Plan or Compensation Arrangement (including the granting of
stock options, stock appreciation rights, shares of restricted stock or
performance units) or grant any severance or termination pay to (except pursuant
to existing Employee Plans or Compensation Arrangements), or enter into, review,
terminate, amend or waive any material provision of any employment or severance
agreement with, any director, officer or other employee of the Company or
establish, adopt, enter into, or amend any collective bargaining agreement,
employment agreement, termination agreement, Employee Plan, or Compensation
Arrangement;
(vi) acquire, sell, lease, license, transfer, pledge, encumber, grant or dispose
of (whether by merger, consolidation, purchase, sale or otherwise) any assets,
including any capital stock or equity interest in any Subsidiary (other than as
provided in Section 6.15 of this Agreement or the acquisition and sale of
inventory or the disposition of used or excess equipment and the purchase of raw
materials, supplies and equipment, in either case in the Ordinary Course of
Business);
(vii) incur or assume or prepay any indebtedness for borrowed money, assume,
guarantee, endorse or otherwise become liable or responsible (whether directly,
contingently or otherwise) for the obligations of any other Person, or make any
loans, advances or capital contributions to, or investments in, any other
Person;
(viii) change any accounting policies or procedures, other than in the Ordinary
Course of Business or as required by GAAP;
(ix) waive, release, assign, settle or compromise any material rights, claims or
litigation;
(x) take any action that would make any representation or warranty set forth in
Article 5 to become untrue in any material respect;
(xi) make any Tax election or settle or compromise any material federal, state,
local or foreign income Tax Liability;
(xii) enter into any Contract except for any Contract entered into in the
Ordinary Course of Business or amend or terminate any existing Material
Contract;
(xiii) incur any Liability except for Liabilities incurred by the Company in the
Ordinary Course of Business (none of which results from, arises out of, relates
to, is in the nature of or was caused by any breach of contract, breach of
warranty, tort, infringement or violation of law);
(xiv) authorize or enter into any formal or informal binding written or other
agreement or otherwise make any binding commitment to do any of the foregoing;
(xv) make any material increase in the size or materially change the
composition of the workforce of the Company; or
-23-
30
(xvi) voluntarily recognize any union or other collective bargaining
representative as the collective bargaining representative for any of the
employees of the Company.
(b) Seller shall cause the Company to do the following:
(i) maintain its assets in good operating condition (ordinary wear and tear
excepted), with inventories of spare parts and expendable supplies being
maintained at levels consistent with past practices and to make all repairs or
replacements necessary to restore any assets to the condition represented and
warranted in Article 5 of this Agreement;
(ii) maintain the existing insurance policies in full force and effect;
(iii) maintain the books and records of the Company in accordance with past
practices;
(iv) furnish to Buyer within twenty days after the end of each month monthly
financial statements for the month just ended containing balance sheets and
statements of income and cash flow for such period which shall comply with the
representations and warranties set forth in Section 5.7;
(v) comply in all material respects with all laws, rules, regulations and with
all Contracts and Governmental Licenses and keep in full force and effect all
Material Governmental Licenses;
(vi) pay all of the obligations and Liabilities of the Company in the
Ordinary Course of Business; and
(vii) preserve the corporate existence of the Company and the Subsidiaries.
Section 6.2 Seller's Actions. Seller shall not sell, transfer or encumber any of
the Shares and shall not enter into any commitment to sell, transfer or encumber
any of the Shares. Seller shall cause the Company to comply with all of the
terms of this Agreement applicable to them, including Section 6.1. To the extent
that any covenant or agreement in this Article 6 requires Seller to cause or to
not permit (or words of similar import) the Company to take a certain action,
such covenant or agreement of Seller shall not be deemed breached by Seller so
long as the action at issue is related to a matter which is principally in
control of the Company's management and so long as Seller used its "reasonable
best efforts" to cause or to not permit the Company to take such action.
Section 6.3 Other Actions. During the period from the date hereof to the
Closing, Seller shall not, and shall cause the Company not to, take any action
that would, or that would reasonably be expected to, result in any of the
conditions to the transactions contemplated hereby set forth in Article 7 or 8
hereof not being satisfied or satisfaction thereof being delayed.
Section 6.4 Notification of Certain Matters. During the period from the date
hereof to the Closing, Seller shall promptly notify Buyer of the occurrence of
any fact or event that
-24-
31
would reasonably be expected (i) to cause any representation or warranty
of Seller contained in this Agreement to be untrue in any material respect,
(ii) to cause any covenant, condition or agreement of Seller hereunder not t
be complied with or satisfied in all material respects or (iii) to cause a
Material Adverse Effect. During the period from the date hereof to the
Closing, Buyer shall promptly notify Seller of the occurrence of any fact or
event that would reasonably be expected (i) to cause any representation
or warranty of Buyer to be untrue in any material respect or (ii) to cause any
covenant, condition or agreement of Buyer hereunder not to be complied with
or satisfied in all material respects.
Section 6.5 Access to Information. During the period from the date hereof to the
Closing, Seller shall cause the Company to: (i) provide to Buyer at Buyer's
expense (and its officers, directors, employees, accountants, consultants, legal
counsel, financial advisors, investment bankers, agents and other
representatives (collectively, "Representatives")) access at reasonable times
upon prior notice to Seller to the assets and properties, personnel and the
books and records of the Company and (ii) furnish promptly such information
concerning the business, properties, contracts, assets, liabilities, personnel
and other aspects of the Company as Buyer or its Representatives may reasonably
request.
Section 6.6 Cooperation; Further Assurances. Subject to the terms and conditions
provided in this Agreement and to applicable legal requirements, each of the
parties hereto agrees to use its commercially reasonable efforts to take, or
cause to be taken, all action, and to do, or cause to be done and to assist and
cooperate with the other parties hereto in doing, as promptly as practicable,
all things necessary, proper or advisable under applicable laws and regulations
to ensure that the conditions set forth in Articles 7 and 8 are satisfied and to
consummate and make effective the transactions contemplated by this Agreement.
No party to this Agreement shall take any action that is inconsistent with its
obligations under this Agreement. Notwithstanding the foregoing, Buyer shall not
be required to expend any monies to obtain any Consent to be obtained by Seller
or to accept any condition or change in terms (other than ministerial,
immaterial conditions or changes) to obtain any Consent to be obtained by
Seller.
Section 6.7 Public Announcements. The initial press release concerning the sale
of the Shares to Buyer shall be a joint press release reasonably acceptable to
both parties and, thereafter until the Closing, each party shall obtain the
consent of the other party (which consent will not be unreasonably withheld)
before issuing any press release or otherwise making any public statements with
respect to this Agreement or any of the transactions contemplated hereby and
shall not issue any such press release or make any such public statement prior
to obtaining such consent, except to the extent public disclosure may be
required to comply with applicable law, including under the securities laws or
the requirements of any securities exchange, as determined by the disclosing
party in good faith and after prior written notice to the other party hereto
(provided that Buyer has already informed Seller that Buyer intends to file a
registration statement with the Securities Exchange Commission on or about
December 30, 1999 that will include certain disclosures regarding this
Agreement).
Section 6.8 Confidentiality. Except for such disclosures to officers, directors,
employees, advisors and representatives as may be appropriate in furtherance of
this transaction and except for disclosures that may be required to comply with
applicable law, including under
-25-
32
the securities laws or the requirements of any securities exchange, each party
hereto shall keep, and cause its Affiliates, officers, directors, employees,
advisors and representatives to keep, confidential the terms and conditions
of this Agreement so long as they have not been made publicly available in
accordance with Section 6.7 hereof and all information of a confidential
nature obtained by it from the other party hereto or the Company in
connection with the transactions contemplated by this Agreement,regardless
of whether the Closing occurs (it being understood that after the Closing all
proprietary information of the Company shall be owned by and for the benefit
of Buyer). If this Agreement is terminated without a Closing, (i) each
party hereto will return to the other parties all documents and other
materials obtained from the other party in connection herewith and (ii) Buyer
shall not solicit or encourage or cause others to solicit or encourage any
employee of the Company to terminate his or her employment with the Company
and shall not hire any current or former employee of the Company for a period of
12 months after the end of the term of such employment.
Section 6.9 Expenses; Taxes. Whether or not the transaction contemplated by this
Agreement is consummated and except as otherwise expressly set forth herein, all
expenses, including brokers' fees, incurred in connection with this Agreement
and the transactions contemplated hereby shall be paid by the party incurring
such expenses, except that the filing fee under the HSR Act shall be entirely
borne by the Buyer and all such expenses of the Company shall be entirely borne
by Seller. All transfer Taxes payable as a result of this transaction shall be
borne entirely by Buyer, other than any transfer or other Taxes payable in
connection with or as a result of the real estate transfers contemplated by
Section 6.15 hereof, which shall be borne entirely by Seller.
Section 6.10 Control of the Company's Operations. Nothing contained in this
Agreement shall give Buyer, directly or indirectly, any right to control or
direct the Company's operations prior to the Closing.
Section 6.11 Xxxx-Xxxxx-Xxxxxx Filing. Seller and Buyer have filed the
pre-merger notifications which are required under the Xxxx-Xxxxx-Xxxxxx
Antitrust Improvements Act of 1976, as amended, and the regulations thereunder
(the "HSR Act") with respect to the transactions contemplated hereby. Each party
shall furnish to the other such necessary information and reasonable assistance
as any other party may request in connection with its preparation of necessary
filings or submissions pursuant to the provisions of the HSR Act. If the Federal
Trade Commission or the Department of Justice requests additional information
from the parties or imposes any condition upon the transactions contemplated
hereby, the parties will cooperate with each other, the Federal Trade Commission
and the Department of Justice; provided, however, that nothing herein shall
compel either party or any affiliate of such party to comply with any condition
imposed upon such party or such affiliate that is adverse to the interests of
such party or its affiliates as determined by such party in the exercise of its
reasonable business judgment.
Section 6.12 Other Buyer Transactions. Notwithstanding anything to the contrary
in this Agreement, nothing in this Agreement shall prevent or restrict Buyer and
its subsidiaries from engaging in any merger, acquisition, business
-26-
33
combination or other transaction (whether or not Buyer is the surviving
corporation), provided that such merger, acquisition, business
combination or other transaction would not prevent Buyer from complying with
or consummating its obligations under this Agreement.
Section 6.13 Consents. Seller shall, or shall cause the Company to, as soon as
practicable after the execution of this Agreement, give all notices of this
Agreement or the transaction contemplated hereby to Governmental Authorities and
other third parties to the extent required by any law, rule, regulation or
Contract. Except as disclosed on Schedule 5.3 (Item 3), Seller shall, and shall
cause the Company to, use commercially reasonable efforts to obtain, as soon as
practicable after the execution of this Agreement, all of the Consents without
any change in the terms of any Contract or License to which such Consent relates
(other than ministerial, immaterial changes or conditions). Seller shall
promptly notify Buyer of any difficulty in obtaining any Consents.
Section 6.14 Employee Benefits Matters.
(a) Prior to the Closing, Seller and the Company shall take any and all action
necessary or appropriate to (i) transfer to the Northwest Broadcasting Limited
Partnership 401(k) Savings Plan (the "Seller Plan") all of the assets and
liabilities of the Stainless, Inc. 401(k) Plan ("Company 401(k) Plan") which are
attributable to employees or former employees of any ERISA Affiliate which has
been a participating employer in the Company 401(k) Plan, including but not
limited to Bend Broadcasting, LLC, such transfer being conditioned upon the
receipt by Company 401(k) Plan of evidence reasonably acceptable to the trustee
of Company 401(k) Plan that the Seller Plan is intended to be tax-qualified
under Code Section 401(a), and (ii) terminate immediately prior to the Closing
the Company 401(k) Plan.
(b) If requested by Buyer, at the Closing Seller will cause the Company to pay
all normal year-end bonuses for 1999 to the Company employees (which Seller
estimates in good faith will be approximately $200,000). Notwithstanding the
previous sentence, Seller shall be entirely responsible for all payments that
may be due or may become due to Xxxx Xxxxxxxx and Xxx Xxxxx as a result of the
consummation of the transactions contemplated hereby.
(c) Seller shall assume and maintain full responsibility for
all liabilities, including but not limited to any applicable penalties imposed
by the Department of Labor or Internal Revenue Service, with respect to the
Company's failure to file complete and accurate Internal Revenue Service Forms
5500 with respect to its cafeteria plan, or any employee benefit plan, as
defined in Section 3(3) of ERISA, which was filed or required to be filed on or
before December 31, 1999.
Section 6.15 Real Estate Matters.
(a) During the period after the execution hereof to the Closing, Seller shall
cause the Company to provide to Buyer at Buyer's expense reasonable access to
the Real Property and reasonable cooperation upon prior notice to the Company in
connection with Buyer's Real Property due diligence for the sole purpose of
allowing Buyer and its agents to reasonably prepare surveys and title
commitments or policies.
-27-
34
(b) The real property parcel owned by the Company located in
Perkasie, Pennsylvania shall be transferred at or before the Closing to the
redevelopment agency of the local borough or to another person, at Seller's sole
cost and expense and without any cost or expense to Buyer or the Company. To the
extent any costs or expenses (including Taxes) resulting from such transfer are
known at Closing, such costs will be paid out of and reduce the Cash
Consideration paid to Seller at Closing.
(c) To the extent the real property parcel located in Pine
Forge, Pennsylvania is not owned by the Company, Seller shall cause it to be
transferred at or before the Closing to the Company, at Seller's sole cost and
expense and without any cost or expense to Buyer or the Company by means of a
capital contribution by Seller. To the extent any costs or expenses (including
Taxes) resulting from such transfer are known at Closing, such costs will be
paid out of and reduce the Cash Consideration paid to Seller at Closing. The
transfer shall be effected by a warranty deed in a form reasonably acceptable to
Buyer. As soon as practicable after the Closing Seller shall cause a
satisfactory release or other instrument to be delivered to Buyer that will
release of record in the real estate records the mortgage granted to Continental
Bank in or about 1971 that encumbers the title to the Pine Forge real property,
at Seller's sole cost and expense and without any cost or expense to Buyer or
the Company.
(d) To the extent still owned by the Company, Seller shall
cause the real property parcels located in North Wales, Pennsylvania to be
transferred out of the Company at or prior to Closing in a manner reasonably
acceptable to Buyer at Seller's sole cost and expense and without any cost or
expense to Buyer or the Company. To the extent any costs or expenses (including
Taxes) resulting from such transfer are known at Closing, such costs will be
paid out of and reduce the Cash Consideration paid to Seller at Closing.
(e) Seller shall cause the lease between the Company, as
landlord, and Nehemiah's Way of North Wales, Inc., as tenant, with respect to
the real property parcels located at 000 Xxxx Xxxxxxxxxx Xxxxxx, Xxxxx Xxxxx,
Xxxxxxxxxxxx and all of the Company's duties and obligations thereunder, to be
assigned to SEPA or a third party at or prior to the Closing at Seller's sole
cost and expense and without any cost or expense to Buyer or the Company.
Section 6.16 Tax Matters.
(a) Tax Returns. Seller and the Company shall be responsible
for the preparation and filing of, and the payment of Taxes with respect to, all
Tax Returns of the Company that are required to be filed after the date hereof
and on or prior to the Closing Date; provided, however, that in preparing such
Tax Returns, Seller and the Company shall consult with Buyer in good faith and
shall provide Buyer with drafts of such Tax Returns (together with the relevant
back-up information) for review and consent by Buyer, which consent shall not be
unreasonably withheld, at least 20 days prior to filing. All such Tax Returns
shall be prepared and filed in a manner consistent with the past custom and
practice of the Company.
(b) Retention of Records. From and after the date hereof until
the Closing, Seller shall cause the Company to retain all Tax Returns and all
books, records and other information relating to any Tax or Tax Return of the
Company, and to abide by all record retention agreements entered into with any
Governmental Authority.
-28-
35
(c) Within twenty (20) days following the Closing, Seller
shall (or shall cause the Company to) deliver to Buyer true, correct and
complete information, as of the end of the most recently concluded taxable year
of the Company, regarding: (i) the Tax basis of the assets of the Company and
the depreciation and amortization schedules relating to such assets, and (ii)
the earnings and profits, net operating loss carryovers, and other Tax
attributes, credits and carryover items (and any limitations applicable to any
of the foregoing) of the Company.
Section 6.17 Intercompany Accounts. Buyer and Seller hereby agree and
acknowledge that all of the receivables, payables and loans between the Company
(on the one hand) and Seller and its Affiliates (on the other hand) shall be
deemed automatically cancelled as of the Closing without further action by the
parties.
Section 6.18 Standby Letter of Credit. Buyer hereby agrees to take all
commercially reasonable actions necessary to assist Seller in obtaining a
release, subject to the occurrence of the Closing, of its obligation to maintain
a letter of credit in connection with the construction of a tower by the Company
in North Carolina.
Section 6.19 Schedule Updates. Following the execution of this Agreement, Seller
shall have the right to update the Schedules to this Agreement to disclose
matters that arise after and relate to the period following the execution of
this Agreement. If any such disclosed matters, individually or in the aggregate,
could reasonably be expected to have a Material Adverse Effect, Buyer will be
entitled to terminate this Agreement pursuant to Article 10. If Buyer does not
terminate this Agreement and closes the transactions contemplated by this
Agreement, such disclosed matters shall be deemed to have been disclosed on the
Schedules to this Agreement from the time of execution of this Agreement for all
purposes of Buyer's indemnification rights under Article 11.
Section 6.20 Post-Closing Covenants.
(a) General. If at any time after the Closing any further action is necessary or
desirable to carry out the purposes of this Agreement, each of the parties will
take such further action (including the execution and delivery of such further
instruments and documents) as any other party reasonably may request, all at the
sole cost and expense of the requesting party (unless the requesting party is
entitled to indemnification therefor under Article 11). Seller acknowledges and
agrees that from and after the Closing Buyer will be entitled to possession of
all documents, books, records (including Tax records), agreements, and financial
data of any sort relating to the Company.
(b) Transition. Seller shall not take any action that is designed or intended to
have the effect of discouraging any lessor, licensor, customer, supplier or
other business associate of the Company from maintaining the same business
relationships with the Company after the Closing as it maintained with the
Company prior to the Closing. Seller will refer all customer inquiries relating
to the businesses of the Company to the Buyer from and after the Closing.
-29-
36
(c) Covenant Not to Compete. For a period of three years from and after the
Closing Date, neither Seller nor its general partner nor any of its direct or
indirect subsidiaries, nor its Class B or Class C limited partners will engage
directly or indirectly in the business of the engineering, fabrication,
construction and maintenance of television and radio transmission towers;
provided, however, that no owner of less than 5% of the outstanding stock of any
publicly-traded corporation shall be deemed to engage solely by reason thereof
in the prohibited business. If the final judgment of a court of competent
jurisdiction declares that any term or provision of this Section 6.20(c) is
invalid or unenforceable, the parties agree that the court making the
determination of invalidity or unenforceability shall have the power to reduce
the scope, duration or area of the term or provision, to delete specific words
or phrases, or to replace any invalid or unenforceable term or provision with a
term or provision that is valid and enforceable and that comes closest to
expressing the intention of the invalid or unenforceable term or provision, and
this Agreement shall be enforceable as so modified after the expiration of the
time within which the judgment may be appealed.
(d) Pine Forge Environmental Due Diligence.
(1) At no time before or after the Closing shall
Buyer or its Affiliates (including the Company after the Closing)
undertake, or cause to be undertaken, any environmental sampling
(whether intrusive or non-intrusive), or analysis of soil, groundwater,
soil gas, surface water or any other surface or subsurface condition
at, on or under the real property or facilities at Pine Forge,
Pennsylvania, except if any of the foregoing is compelled or required
by a Governmental Authority or the lenders of Buyer or its Affiliates,
it being understood that subject to Section 11.6(e)(2) hereof and
subject to Section 6.20(d)(2) below, this Section 6.20(d)(1) shall in
no way prohibit Buyer or the Company from discharging any legal
obligation imposed on Buyer or the Company to remediate any
environmental condition at, on or under the real property or facilities
at Pine Forge or from making a claim for indemnification therefor
against Seller pursuant to Section 11.2 hereof.
(2) In the event any third party (other than Buyer or
its Affiliates if compelled or required by a Governmental Authority or
the lenders of Buyer or its Affiliates, and other than any other Person
acting on behalf of such Governmental Authority or lenders) undertakes,
or causes to be undertaken, any environmental due diligence that would
be prohibited by Section 6.20(d)(1) above were Buyer or its Affiliates
undertaking such due diligence, the indemnification provided in
Sections 11.2(e) and Section 11.2(f) shall immediately terminate and be
of no further force and effect, except as to claims thereunder that
have already been made by Buyer prior to such time, in respect of which
Buyer's indemnification rights shall survive as in effect before giving
effect to this Section 6.20(d)(2).
Section 6.21 Insurance. The parties agree that the Company and Buyer will not be
required after the closing to retain SEPA as an insured party under the
Company's insurance policies.
Section 6.22 Release. Seller, in its capacity as a stockholder of the Company,
and all persons claiming by, through, for or under Seller in such capacity
(collectively, the "Seller
-30-
37
Related Parties"), hereby agrees that except as provided in this Agreement
it has no claims or the basis for any claims against the Company or the
Company's respective present and former officers, directors, employees or
representatives, on account of any matter arising from the beginning of
time through the date of this Agreement, inclusive, and Seller agrees that
except as provided in this Agreement, neither Seller nor any Seller Related
Parties will ever bring any action or seek to recover upon or in respect of any
such matter arising from the beginning of time through the date of this
Agreement, inclusive.
ARTICLE 7
CONDITIONS TO BUYER'S OBLIGATIONS
The obligations of Buyer to consummate the transactions provided for in
this Agreement are subject to all of the conditions set forth below in this
Article 7, any of which may be waived in writing by Buyer.
Section 7.1 Performance by the Company and Seller. The Company and Seller shall
have performed in all material respects all of their agreements and covenants
under this Agreement required to be performed by them at or prior to the
Closing, except that the covenants set forth in Sections 6.14(a) and 6.15 shall
have been performed in all respects.
Section 7.2 Truth of Representations and Warranties. Each of the representations
and warranties of Seller contained in this Agreement (i) which are expressly
stated to be made solely as of the date of this Agreement or another specified
date shall be true and correct in all respects as of such date, and (ii) all
other representations and warranties of Seller shall be true and correct in all
respects at and as of the time of the Closing as though made at and as of that
time, except in each case of clauses (i) and (ii) to the extent that the
aggregate effect of the inaccuracies in such representations and warranties as
of the applicable times could not reasonably be expected to result in a Material
Adverse Effect.
Section 7.3 Receipt of Consents. All of the Consents indicated as material on
Schedule 3.2 or 5.3, including the North Wales office lease (the "Material
Consents") shall have been obtained and delivered to Buyer and shall be in full
force and effect as of the Closing and shall be in form and substance reasonably
satisfactory to Buyer without any conditions or changes in the underlying
Contract or License to which such Material Consent relates (other than
ministerial or immaterial conditions or changes).
Section 7.4 HSR Act and other Governmental Authorizations . All waiting periods
required under the HSR Act shall have expired or otherwise shall have been
terminated prior to the Closing, and the parties and the Company shall have
received all other authorizations, consents and approvals of Governmental
Authorities required to consummate the transactions contemplated hereby in a
lawful manner.
Section 7.5 Deliveries. Seller and the Company shall have made all of the
deliveries required by Section 9.2.
Section 7.6 Material Adverse Effect. Since October 31, 1999, no Material
Adverse Effect shall have occurred.
-31-
38
Section 7.7 Repayment of Indebtedness and Certain Other Obligations. All Company
indebtedness (including all indebtedness for borrowed money and purchase money
financing arrangements), and any obligations of the Company in the nature of
prepayment penalties, premiums, or termination penalties resulting from the
consummation of the transactions contemplated by this Agreement, shall have been
paid in full and discharged before the Closing at Seller's sole expense or
concurrently with the Closing out of the Cash Consideration otherwise payable to
Seller, except the capitalized lease of the Company. The guarantee of the
Company in favor of the Lenders under the Seller's credit facility shall have
been released and all claims of such lenders against the Company shall have been
released, such release to be reasonably satisfactory to Buyer.
Section 7.8 Affiliate Loans. All loans and other advances made by the Company to
Seller or any Affiliate thereof or to any employee, officer or director of the
Company or a family member thereof (excluding loans and advances to employees
for travel, business and moving expenses in the Ordinary Course of Business)
shall have been repaid, and Buyer shall have received evidence of such repayment
or shall have been cancelled in accordance with Section 6.17 hereof.
Section 7.9 Certain Proceedings. No writ, order, decree or injunction of a court
of competent jurisdiction or other Governmental Authority shall have been
entered against Buyer, Seller, or the Company that prohibits or restricts the
transactions contemplated hereby, limits or restricts the operation of the
Company's business as it is currently conducted, or otherwise restricts the
Company's exercise of full rights to own and operate its business after the
Closing, and no action, proceeding, investigation, regulation or legislation
shall have been instituted or threatened before any court or other Governmental
Authority which (i) questions the validity or legality of the transactions
contemplated hereby or seeks to enjoin, restrain, prohibit or obtain substantial
damages in respect of, or which is related to, or arising out of, this Agreement
or the consummation of the transactions contemplated hereby; (ii) seeks material
damages against Buyer, Seller, or the Company as a result of the transactions
contemplated hereby; or (iii) can otherwise reasonably be expected to materially
and adversely affect Buyer or the Company as a result of the consummation of the
transactions contemplated hereby.
Section 7.10 Seller Actions. All actions to be taken by Seller in connection
with the consummation of the transactions contemplated hereby and all
certificates, opinions, instruments and other documents required to effect the
transactions contemplated hereby shall be reasonably satisfactory in form and
substance to Buyer.
-32-
39
ARTICLE 8
CONDITIONS TO THE OBLIGATIONS OF SELLER
The obligations of Seller to consummate the transactions provided for
in this Agreement are subject to all of the conditions set forth below in this
Article 8, any of which may be waived in writing by Seller.
Section 8.1 Performance by Buyer. Buyer shall have performed in all material
respects all of its agreements and covenants under this Agreement required to be
performed by it at or prior to the Closing.
Section 8.2 Truth of Representations and Warranties. Each of the representations
and warranties of Buyer contained in this Agreement (i) specifically qualified
by materiality, shall be true and complete as so qualified, and (ii) if not
qualified by materiality, shall be true and complete in all material respects,
in each such case, on and as of the Closing Date, with the same effect as if
then made, except where any such representation or warranty is as of a specific
earlier date in which event it shall remain true and correct (as qualified) as
of such earlier date.
Section 8.3 HSR Act. All waiting periods required under the HSR Act shall have
expired or otherwise shall have been terminated prior to the Closing.
Section 8.4 Deliveries. Buyer shall have made all of the deliveries set
forth in Section 9.3.
Section 8.5 Certain Proceedings. No writ, order, decree or injunction of a court
of competent jurisdiction or other Governmental Authority shall have been
entered against Seller or the Company that prohibits or restricts the
transaction contemplated hereby and no action, proceeding, investigation,
regulation or legislation shall have been instituted or threatened before any
court or any other Governmental Authority which (i) questions the validity or
legality of the transactions contemplated hereby or seeks to enjoin, restrain,
prohibit or obtain substantial damages in respect of, or which is related to, or
arising out of, this Agreement or the consummation of the transactions
contemplated hereby, (ii) seeks material damages against Seller as a result of
the transactions contemplated hereby; or (iii) can otherwise reasonably be
expected to materially and adversely affect Seller as a result of the
consummation of the transactions contemplated hereby.
Section 8.6 Buyer Actions. All actions to be taken by Buyer in connection with
the consummation of the transactions contemplated hereby and all certificates,
opinions, instruments and other documents required to effect the transactions
contemplated hereby shall be reasonably satisfactory in form and substance to
Seller.
ARTICLE 9
CLOSING
Section 9.1 Closing. Subject to satisfaction or waiver of all of the conditions
of closing set forth in Articles 7 and 8, the closing of the transactions
contemplated hereby (the
-33-
40
"Closing") shall take place at the offices of Dow, Xxxxxx & Xxxxxxxxx, PLLC,
0000 Xxx Xxxxxxxxx Xxx., X.X., Xxxxx 000, Xxxxxxxxxx, X.X. 00000, at 10:00 a.m.,
local time, on the date specified by Buyer by notice to Seller, which
specified date shall be no later than ten business days after the conditions
of Closing set forth in Sections 7.3, 7.4, and 8.3 have been satisfied or
waived or on such other date as Buyer and Seller may mutually agree (the
"Closing Date").
Section 9.2 Deliveries and Actions by Seller. Seller shall deliver to
Buyer the following items at the Closing:
(a) Consents. Seller shall deliver to Buyer at Closing originals of the Material
Consents to be obtained by Seller or the Company and any other Consents which
have been obtained by them.
(b) Articles of Incorporation, Certified Bylaws and Certificates of Existence
and Good Standing for the Company. Seller shall deliver to Buyer at Closing (i)
copies of the articles of incorporation or other applicable governing
instruments and all amendments thereto of each of the Company and Seller
certified within twenty business days prior to the Closing by the Secretary of
State of the State in which such entity is organized, (ii) copies of the bylaws
or other applicable governing instruments of the Company certified by an
executive officer of the Company as being correct, complete and in full force
and effect on the Closing Date, and (iii) certificates of existence and good
standing of each of the Company and Seller dated within twenty business days of
the Closing Date issued by the Secretary of State of the State in which each
such entity is organized and in the case of the Company, qualified to conduct
business.
(c) Company's Closing Certificate. Seller shall deliver to Buyer at Closing a
certificate of an executive officer of Seller certifying (i) as to the
incumbency and signatures of the officers of Seller who executed this Agreement
and any other documents delivered pursuant to this Agreement, (ii) as to the
adoption of resolutions of its board of directors or corresponding governing
body and the board of directors of its corporate general partner which are in
full force and effect on the Closing Date without any amendments thereto
authorizing the execution and delivery of this Agreement and any other
agreements contemplated hereby and the performance of the obligations of Seller
hereunder and thereunder, and (iii) that the conditions to Buyer's obligations
to consummate the transactions contemplated by this Agreement set forth in
Sections 7.1 and 7.2 have been satisfied.
(d) Certificates. Seller shall deliver to Buyer the stock certificates
representing all of the issued and outstanding Shares duly endorsed for transfer
by Seller.
(e) Resignations and Releases. Seller shall deliver to Buyer resignations of the
officers and directors of the Company effective as of the Closing. Seller shall
deliver to Buyer releases of the officers and directors of the Company releasing
all claims they may have against the Company, in a form mutually satisfactory to
Buyer and Seller.
(f) Lien Searches. Seller shall deliver to Buyer lien, tax and judgment searches
in the Commonwealth of Pennsylvania and in the counties of Berks, Pennsylvania,
Bucks, Pennsylvania and Xxxxxxxxxx, Pennsylvania, and releases and terminations
of all Liens
-34-
41
on the Shares and the assets of the Company that are not Permitted
Liens described in clauses (i), (ii) and (iii) of the definition of Permitted
Liens.
(g) Opinion of Counsel. Seller shall deliver the favorable opinion of
Xxxxxxxxxxxx Xxxx & Xxxxxxxxx substantially in the form of Exhibit A.
(h) Other Evidence. Seller shall deliver to Buyer such other evidence of the
performance of all the covenants and satisfaction of all the conditions required
of Seller by this Agreement at or before Closing as Buyer or its counsel may
reasonably request.
Section 9.3 Deliveries and Actions by Buyer. Buyer shall deliver to
Seller the following items at the Closing:
-------------------------------
(a) Certificates of Existence, Good Standing and
Qualification. Buyer shall deliver to Seller at Closing a certified copy of its
certificate of incorporation and a certificate of good standing with respect to
Buyer, dated within twenty business days of the Closing Date, issued by the
Secretary of State of the State of Delaware.
(b) Buyer's Closing Certificate. Buyer shall deliver to Seller
at Closing a certificate of an executive officer of Buyer certifying (i) as to
the incumbency and signatures of the officers of Buyer who executed this
Agreement and the agreements contemplated hereby on behalf of Buyer, (ii) as to
the adoption of resolutions of the board of directors of Buyer which are in full
force and effect on the Closing Date authorizing the execution and delivery of
this Agreement and the agreements contemplated hereby and the performance of the
obligations of Buyer hereunder and thereunder, (iii) as to Buyer's bylaws and
all amendments thereto as being correct, complete and in full force and effect
on the Closing Date, and (iv) that the conditions to Seller's obligations to
consummate the transactions contemplated by this Agreement set forth in Sections
8.1 and 8.2 have been satisfied.
(c) Purchase Price. Buyer shall deliver to Seller by wire
transfer of immediately available funds the Purchase Price, subject to
adjustment pursuant to the provisions of Section 6.15 and Section 7.7.
(d) Opinion of Counsel. Buyer shall deliver the favorable
opinion of Dow, Xxxxxx & Xxxxxxxxx, PLLC substantially in the form of Exhibit B.
(e) Other Evidence. Buyer shall deliver to Seller such other
evidence of the performance of all the covenants and satisfaction of all the
conditions required of Buyer by this Agreement at or before Closing as Seller or
its counsel may reasonably request.
ARTICLE 10
TERMINATION
Section 10.1 Termination. This Agreement may be terminated and the
transactions contemplated hereby may be abandoned at any time
prior to the Closing:
(a) by mutual written agreement of Seller and Buyer;
-35-
42
(b) by either Seller or Buyer, if:
(i) the transaction contemplated hereby has not been consummated on or before
January 31, 2000 (the "Termination Date"); provided that the right to terminate
this Agreement pursuant to this Section 10.1(b)(i) shall not be available to a
party whose breach of any provision of this Agreement results in the failure of
such transaction to be consummated by the Termination Date; or
(ii) (A) there shall be any law or regulation that makes consummation of the
transaction contemplated hereby illegal or otherwise prohibited or (B) any
judgment, injunction, order or decree of any court or other Governmental
Authority having competent jurisdiction enjoining Seller or Buyer from
consummating such transaction is entered, and such judgment, injunction, order
or decree shall have become final.
(c) by Buyer if on any date determined for the Closing in accordance with
Section 9.1 each condition in Article 8 has been satisfied (or will be satisfied
by actions to be taken at the Closing) and either a condition set forth in
Article 7 has not been satisfied (or will not be satisfied by actions to be
taken at the Closing) or Seller has nonetheless refused to consummate the
Closing; provided that Buyer may not terminate pursuant to this Section 10.1(c)
if the failure of any condition set forth in Article 7 to be satisfied was
caused by Buyer's breach of or failure to perform any of its covenants and
agreements in accordance with this Agreement;
(d) by Seller if on any date determined for the Closing in accordance with
Section 9.1 each condition in Article 7 has been satisfied (or will be satisfied
by actions to be taken at the Closing) and either a condition set forth in
Article 8 has not been satisfied (or will not be satisfied by actions to be
taken at the Closing) or Buyer has nonetheless refused to consummate the
Closing; provided that Seller may not terminate pursuant to this Section 10.1(d)
if the failure of any condition set forth in Article 8 to be satisfied was
caused by Seller's breach of or failure to perform any of its covenants and
agreements in accordance with this Agreement; and
(e) by Buyer pursuant to its rights under Section 6.19 of
this Agreement.
The party desiring to terminate this Agreement pursuant to
this Section 10.1 (other than pursuant to Section 10.1(a)) shall give notice of
such termination to the other party hereto.
Section 10.2 Effect of Termination. If this Agreement is terminated pursuant to
Section 10.1, this Agreement shall become void and of no effect without
liability of any party hereto to the other parties hereto, except that (a) the
agreements contained in this Section 10.2 and in Sections 6.8 and 6.9 of this
Agreement shall survive the termination hereof, and (b) no such termination
shall relieve any party of any liability or damages resulting from any material
breach by such party of any representation, warranty, covenant or agreement set
forth in this Agreement. Each party shall have all remedies available to it at
law, equity or otherwise in the event the other party wrongfully refuses to
consummate the Closing or otherwise breaches this Agreement.
-36-
43
ARTICLE 11
INDEMNIFICATION
Section 11.1 Survival of Representations and Warranties. All of the
representations and warranties of the parties hereto contained in this Agreement
shall survive the Closing hereunder (even if the damaged party knew or had
reason to know of any misrepresentation or breach of warranty or covenant at the
time of Closing) and continue in full force and effect until the latest of: (a)
the date that is one year after the Closing Date, (b) the date of final
resolution of a claim that has been asserted in writing to the other party prior
to the expiration of the applicable survival period, and (c) as to the
representations and warranties made in Sections 3.2, 3.5, 4.2, 5.1, 5.2, 5.11
and 5.22 the expiration of the applicable statute of limitations (including all
periods of extension thereof) or, if later as to the representations and
warranties made in Section 5.11, until the final resolution of any claim
asserted in writing by a Governmental Authority.
Section 11.2 Indemnification by Seller. From and after the Closing, Seller shall
indemnify Buyer and its Affiliates (including the Company), officers, directors,
employees, stockholders and agents (the "Buyer Indemnified Parties") against and
hold them harmless from any liability, claim, damage, Tax or expense (including
reasonable legal fees and expenses) ("Losses") suffered or incurred by any Buyer
Indemnified Party as a result of, arising from or relating to the following:
(a) any breach of any representation or warranty of Seller contained in
this Agreement or any certificate delivered pursuant hereto;
(b) any breach of any covenant or agreement of Seller contained in this
Agreement;
(c) Undisclosed Liabilities resulting from or arising out of the conduct of the
Business prior to the Closing;
(d) the real property and facilities of the Company and its
Affiliates located in Perkasie, Pennsylvania and North Wales, Pennsylvania,
including any Environmental, Health and Safety Requirement matters relating
thereto and including Item 4 on Schedule 5.20 (Zoning Hearing Appeal);
(e) third party claims (i.e. claims by any Person other than
Buyer and its Affiliates, including the Company) as a result of, arising from or
relating to the presence of ground water contamination (as described in the
environmental surveys referred to in Item 1 of Schedule 5.24) at the real
property and facilities of the Company and its Affiliates located in Pine Forge,
Pennsylvania;
(f) any Environmental, Health and Safety Requirement matters
that relates to the real property and facilities of the Company and its
Affiliates located in Pine Forge, Pennsylvania and to the period prior to the
Closing that are not subject to indemnification pursuant to section 11.2(e)
above, including Item 3 on Schedule 5.24;
-37-
44
(g) the real estate transfers contemplated in Section 6.15
hereof, including any Taxes resulting from the sale, exchange, distribution or
other disposition of the property and facilities referred to in Section 6.15;
(h) the Saudi tower litigation (including Item 2 on Schedule
5.20 and any related arbitration costs), the Louisiana tower litigation
(including Item 3 on Schedule 5.20), the Gateway suit (including Item 5 on
Schedule 5.20), and the SEPA shareholder suits (including Items 1 and 6 on
Schedule 5.20);
(i) expenses of the Seller and the Company relating to the
consummation of the transactions contemplated by this Agreement, including fees
and expenses of attorneys, accountants, financial advisors and broker fees;
(j) the payments to Xxxx Xxxxxxxx and Xxx Xxxxx described
in Section 6.14(b);
(k) the Taxes of any Person for any taxable period beginning
on or before the Closing Date for which the Company is or becomes liable
pursuant to Section 1.1502-6 of the Treasury Regulations or pursuant to any
comparable provisions of state, local or foreign law, or by contract or
otherwise;
(l) dividends, distributions or payments made in violation of
the covenant set forth in Section 6.1(a)(iii);
(m) a breach of the covenants and agreements set forth in
Section 6.14(c);
(n) the Continental Bank mortgage referenced in Section
6.15(c); and
(o) any action, suit, proceeding, claim, demand, assessment or
judgment incident to the foregoing or incurred in investigating or to avoid the
same or to oppose the imposition thereof or in enforcing this indemnity.
Section 11.3 Indemnification by Buyer. From and after the Closing, Buyer shall
indemnify Seller and its Affiliates, officers, directors, employees,
stockholders and agents (the "Seller Indemnified Parties") against and hold them
harmless from any Losses suffered or incurred by any Seller Indemnified Parties
as a result of, arising from or relating to the following:
(a) any breach of any representation or warranty of Buyer contained in this
Agreement or in any certificate delivered pursuant hereto;
(b) any breach of any covenant or agreement of Buyer contained in this
Agreement;
(c) liabilities of the Company resulting from or arising out
of the conduct of the Business by the Company after the Closing and Disclosed
Liabilities of the Company resulting from or arising out of the conduct of the
Business prior to the Closing, in each case
-38-
45
unless and to the extent Buyer is entitled to indemnification therefore pursuant
to Section 11.2 hereof;
(d) any costs to Seller associated with the maintenance
of or payments under the Letter of Credit referenced in Section 6.18 hereof; and
(e) any action, suit, proceeding, claim, demand, assessment or
judgment incident to the foregoing or incurred investigating or to avoid the
same or to oppose the imposition thereof or in enforcing this indemnity.
Section 11.4 Procedure for Indemnification. The procedure for
indemnification shall be as follows:
(a) The party claiming indemnification (the "Claimant") shall promptly give
notice to the party from which indemnification is claimed (the "Indemnifying
Party") of any claim, whether between the parties or brought by a third party,
specifying in reasonable detail the factual basis for the claim, the amount
thereof, estimated in good faith, and the method of computation of such claim,
all with reasonable particularity and containing a reference to the provisions
of this Agreement in respect of which such indemnification claim shall have
occurred. If the claim relates to an action, suit, or proceeding filed by a
third party against the Claimant, such notice shall be given by the Claimant
promptly after written notice of such action, suit, or proceeding was given to
the Claimant; provided, however, that any delay in giving the notice shall not
impair the Claimant's rights hereunder unless such delay prejudices the
Indemnifying Party's ability to defend such claim.
(b) With respect to claims solely between the parties, following receipt of
notice from the Claimant of a claim, the Indemnifying Party shall have thirty
days to make such investigation of the claim as the Indemnifying Party deems
necessary or desirable. For the purposes of such investigation, the Claimant
agrees to make available to the Indemnifying Party and its authorized
representatives the information relied upon by the Claimant to substantiate the
claim. If the Claimant and the Indemnifying Party agree prior to the expiration
of such thirty day period (or any mutually agreed upon extension thereof) to the
validity and amount of such claim, the Indemnifying Party shall immediately pay
to the Claimant the full amount of the claim. If the Claimant and the
Indemnifying Party do not agree within such thirty day period (or any mutually
agreed upon extension thereof), the Claimant may seek appropriate remedies
pursuant to Section 12.9.
(c) With respect to any claim by a third party as to which the Claimant is
entitled to indemnification under this Agreement, the Indemnifying Party shall
have the right at its own expense, to participate in or assume control of the
defense, compromise or settlement of such claim (including the selection of
counsel reasonably satisfactory to the Claimant). The Claimant shall cooperate
fully in all respects with the Indemnifying Party in any such defense,
compromise or settlement, including by making available to the Indemnifying
Party all pertinent information under its control, subject to reimbursement for
actual out-of-pocket expenses incurred by the Claimant as the result of a
request by the Indemnifying Party. If the Indemnifying Party elects to assume
control of the defense of any third-party claim, the Claimant shall have the
right to participate in such defense with legal counsel of the Claimant's own
-39-
46
selection, but the fees and expenses of such counsel shall be Claimant's fees
and expenses unless (i) the Indemnifying Party has agreed to pay such fees and
expenses, (ii) the Indemnifying Party has failed to assume the defense of such
claim, within ten business days after receiving notice of such claim, (iii) the
employment of such counsel has been specifically authorized by the Indemnifying
Party, or (iv) the named parties to any proceeding in respect of the claim
(including any impleaded parties) include both the Indemnifying Party and the
Claimant and the Claimant has been advised by counsel that there may be one or
more legal defenses available to it which are different from or additional to
those available to the Indemnifying Party (in which case, if the Claimant
notifies the Indemnifying Party that it elects to employ separate counsel at the
expense of the Indemnifying Party, the Indemnifying Party shall not have the
right to assume the defense of such action, claim or proceeding on behalf of the
Claimant, it being understood, however, that the Indemnifying Party shall not,
in connection with any one such action, claim or proceeding or separate but
substantially similar or related actions, claims or proceedings in the same
jurisdiction arising out of the same general allegations or circumstances, be
liable for the reasonable fees and expenses of more than one separate firm of
attorneys at any time for the Claimant). If the Indemnifying Party does not (or,
as provided in clause (iv) of the preceding sentence, cannot) elect to assume
control or otherwise participate in the defense of any third-party claim, then
the Claimant may defend through counsel of its own choosing and (so long as it
gives the Indemnifying Party at least five business days prior written notice of
the terms of any proposed settlement thereof and permits the Indemnifying Party
to then undertake the defense thereof) settle such claim, action or suit, and to
recover from the Indemnifying Party the amount of such settlement or of any
judgment and the reasonable costs and expenses of such defense. The Indemnifying
Party shall not compromise or settle any third party claim, action or suit
without the prior written consent of the Claimant, which consent will not be
unreasonably withheld or delayed; provided, however, that in the event such
consent is unreasonably withheld and the compromise or settlement includes as an
unconditional term thereof a release of the Claimant from all liability relating
to such matter, then the Indemnifying Party's liability to the Claimant under
this Article 11 shall be limited to the amount it would have been if Claimant
had not withheld its consent
(d) If a claim, whether between the parties or by a third party, requires
immediate action, the parties will make every reasonable effort to reach a
decision with respect thereto as expeditiously as practicable.
(e) Following the Closing, Seller shall have no right of contribution against
the Company for any indemnification payment made by Seller hereunder or
otherwise, and Seller hereby waives any and all rights of contribution that it
may have against the Company.
Section 11.5 Indemnification Escrow. On the Closing Date, Buyer, Seller and
Wachovia Bank, N.A. the ("Escrow Agent") shall execute a Post-Closing Escrow
Agreement substantially in the form attached as Exhibit C (the "Post-Closing
Escrow Agreement") in accordance with which, on the Closing Date, Buyer shall
deposit Two Million Dollars ($2,000,000) of the Purchase Price with the Escrow
Agent (such deposit and all amounts held from time to time by the Escrow Agent
in respect of such deposit, including any interest or other earnings in respect
of such deposit, the "Indemnification Funds") in order to provide a fund for the
payment of any claims for which Buyer is entitled to indemnification as provided
in this Article 11. The Indemnification Funds shall be held and disbursed in
accordance with the terms
-40-
47
of this Agreement and the Post-Closing Escrow Agreement. On the first
business day following the one year anniversary of the Closing Date, any
Indemnification Funds not then subject to indemnification claims of Buyer
under this Agreement shall be released by the Escrow Agent to Seller. If at
any time before the one year anniversary of the Closing Date, Seller sells,
transfers or otherwise transfers all or substantially all of its assets, Seller
shall cause Six Million Dollars ($6,000,000) to be deposited with and held by
Union Bank of California in a segregated account that will not be available
to satisfy any obligations or liabilities of the Seller other than
obligations to Buyer pursuant to this Article 11, and Seller shall provide Buyer
with prompt reasonable evidence that such deposit has been made in accordance
with the foregoing. Seller shall cause the entire $6,000,000 to be so held in
such account until the one year anniversary of the Closing Date. If on the one
year anniversary of the Closing Date there are any outstanding claims for
indemnification by Buyer against Seller under this Article 11 and the stated
amount of such claims exceeds the amount of the Indemnification Funds then
remaining and being held by the Escrow Agent, Seller shall cause the amount of
such deficiency to continue to be so held in such account by Union Bank of
California until such time as the one or more claims giving rise to such
deficiency are resolved and Buyer has been paid any amounts to which it may be
entitled in connection therewith, and Seller may cause any amounts so held by
Union Bank of California in excess of such deficiency to be released to Seller.
So long as Seller is required to hold any monies in such account pursuant to
this Section 11.5, Seller shall provide Buyer with prompt reasonable evidence of
the amounts held in such account upon Buyer's request.
Section 11.6 Limitations on Indemnification; Exclusive Remedy.
(a) No claim for indemnification may be made under Sections 11.2(a) or 11.3(a)
(or under Sections 11.2 (o) or 11.3(e) to the extent such claim relates to a
claim under Sections 11.2(a) or 11.3(a)) unless made within the period of
survival of the applicable representation or warranty as described in Section
11.1. No claim for indemnification may be made under Sections 11.2(b), 11.2(c)
or 11.3(b) (or under Sections 11.2(o) or 11.3(e) to the extent such claim
relates to a claim under Sections 11.2(b), 11.2(c) or 11.3(b)) after the one
year anniversary of the Closing Date, excluding claims relating to covenants to
be performed after the Closing. No claim for indemnification may be made under
Section 11.2(f) (or under Section 11.2(o) to the extent such claim relates to a
claim under Section 11.2(f)) after the twenty-one (21) month anniversary of the
Closing Date. Claims for indemnification under the other provisions of Section
11.2 and 11.3 may be brought at any time after the Closing.
(b) Seller shall be obligated to indemnify Buyer under
Sections 11.2(a)-(c) only to the extent that the aggregate amount of any Losses
suffered or incurred by Buyer, as to which Buyer would be entitled to
indemnification thereunder, shall exceed $1,000,000, in which event any such
amounts shall be payable to the extent such amounts exceed $1,000,000.
(c) In no event shall Seller's aggregate liability under
Sections 11.2(a)-(c) exceed $8,000,000.
(d) The amount of any Losses for which indemnification is
provided under this Article shall be net of any amount actually recovered by the
Claimant under insurance policies with respect to such Losses. To the extent a
claim is covered by insurance, Claimant will diligently pursue recovery under
the appropriate insurance policies in order to mitigate any such
-41-
48
Losses but shall be entitled to make a claim against the other party
pursuant to this Article 11 in order to preserve its rights under this Article
11.
(e) (1) The indemnification provided in Sections 11.2(e) and
11.2(f) is personal to Buyer and its Affiliates. Following the Closing, if Buyer
shall (A) assign its indemnification rights under Sections 11.2(e) or 11.2(f) to
any Person (other than to an Affiliate of Buyer), (B) if the Company sells,
leases, or disposes of all or a substantial portion of its ownership interest in
the facility or real property assets at Pine Forge Pennsylvania to any Person
(other than an Affiliate of Buyer), or (C) violates any of the provisions of
Section 6.20(d)(1) hereof, the indemnification provided in Sections 11.2(e) and
11.2(f) shall immediately terminate and be of no further force and effect except
as to claims thereunder that have already been made by Buyer prior to such time,
in respect of which Buyer's indemnification rights shall survive as in effect
before giving effect to this Section 11.6(e).
(2) Following the Closing, Seller (or one or
more designee(s) of Seller reasonably satisfactory to Buyer), at its sole
expense, shall have the right to assume control of any investigation,
remediation, or other response to an environmental condition in respect of
which Seller acknowledges (based on the then known facts and
circumstances and subject to confirming that the condition is not attributable
to the Company's actions after the Closing) that Buyer is entitled to
dollar-for-dollar indemnification under Sections 11.2(e) or 11.2(f) (and
provided that the Seller's acknowledgment will not create any indemnity rights
in favor of Buyer that Buyer would not have if Seller did not assume control
pursuant to this provision). Such control shall include the selection of
consultants reasonably satisfactory to Buyer and control over negotiations with
Governmental Authorities (subject to Buyer's and the Company's right to be
present at and participate in such negotiations). If Seller elects to assume
control of any such investigation, remediation, or other response, Seller shall
be entitled to pursue any approach for industrial property, including
institutional controls, that is then satisfactory to the applicable Governmental
Authorities, but shall in all cases comply with applicable Environmental, Health
and Safety Requirements, provided that Seller shall keep Buyer and the Company
reasonably informed as to the status of any such matter or claim and shall
consult with Buyer and the Company and obtain their consent (which consent shall
not be unreasonably withheld), prior to undertaking (or agreeing to undertake)
any action that could reasonably be expected to have any material impact or
effect on the conduct of the Company's business at the Pine Forge facility or
that could result in any liability to the Company for which it is not entitled
to indemnification from Seller hereunder. Buyer and the Company will cooperate
with Seller and its representatives in connection with any such matter,
including providing Seller and its representatives reasonable access to the real
property and facilities at Pine Forge, making available to Seller all pertinent
information under Buyer or the Company's control, and consulting with Seller
regarding any communications to or from Governmental Authorities and other
Persons concerning any such matter or claim. If Seller does not elect to assume
control of any such investigation, remediation, or other response within a
timely period or if Seller fails to proceed with due diligence or fails to
comply with or in good faith contest any obligation imposed on Buyer or the
Company with respect to any matter for which Seller has assumed control, Buyer
and the Company shall have the right to assume control of any such
investigation, remediation, or other response through consultants and
representatives of its own choosing and (so long as it gives Seller at least
five business days prior written notice of the terms of any proposed settlement
thereof and permits
-42-
49
Seller to then assume control of such matter if time and circumstances
reasonably permit) settle such matter and recover from Seller all amounts to
which it is entitled under Article 11.
(f) The parties hereto agree that after Closing the sole
remedies of the parties are those set forth in this Article 11 (except with
respect to covenants to be performed after the Closing, including but not
limited to Section 6.20(c) and 11.5, in respect of a breach of which all
remedies of the parties shall be available, whether at law, equity or otherwise,
and except for the Escrow Agreement, which shall be governed in accordance with
its terms).
ARTICLE 12
MISCELLANEOUS
Governing Law. This Agreement shall be governed in all respects by
the laws of the State of Delaware, without regard to such state's conflict of
law rules.
Successors and Assigns. Except as otherwise expressly provided
herein, no party hereto may assign its or his rights and obligations hereunder
unless such party obtains the prior written consent of the other parties hereto;
provided, however, that Buyer shall have the right to assign to any of its
subsidiaries the right to acquire the Shares, but Buyer shall remain liable for
all of its obligations hereunder notwithstanding any such assignment. Except as
otherwise provided herein, this Agreement shall inure to the benefit of, and be
binding upon, the successors and permitted assigns of the parties hereto.
Entire Agreement; Amendment. This Agreement constitutes the full
and entire understanding and agreement among the parties with regard to the
subject matter hereof. Neither this Agreement nor any term hereof may be
amended, waived, discharged or terminated other than by a written instrument
signed by the party against whom enforcement of any such amendment, waiver,
discharge or termination is sought.
Notices, Etc. All notices and other communications required or
permitted hereunder shall be in writing and shall be sent by facsimile, or by
reputable overnight delivery service, postage prepaid, or otherwise delivered by
hand or by messenger, addressed as follows:
to Seller: Northwest Broadcasting, L.P.
0000 Xxxxxxxxxxx Xxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxx 00000
Attention: Xxxxx Xxxxx
Telephone: (000) 000-0000
Fax: (000) 000-0000
-43-
50
with a copy to: Xxxxxxxxxxxx Xxxx & Xxxxxxxxx
0000 X Xx., X.X.
Xxxxx 000, Xxxx Xxxxx
Xxxxxxxxxx, X.X. 00000
Attention: Xxxx X. Xxxx, Esq.
Telephone: (000) 000-0000
Fax: (000) 000-0000
to Buyer: SpectraSite Holdings, Inc.
000 Xxxxxxx Xxxxxx Xxxxx, Xxxxx 000
Xxxx, Xxxxx Xxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxx
Telephone: (000) 000-0000
Fax: (000) 000-0000
with a copy to: Dow, Xxxxxx & Xxxxxxxxx, PLLC
0000 Xxx Xxxxxxxxx Xxxxxx, X.X.
Xxxxx 000
Xxxxxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxx, Esq.
Telephone: 000-000-0000
Fax: 000-000-0000
Notice shall be deemed to be given on the date on which such notice is sent, if
sent by facsimile or by hand or messenger, or the next business day if such
notice is sent by overnight delivery service. Any party hereto may change its
address specified for notices herein by designating a new address by notice in
accordance with this Section, provided that such a notice shall be deemed to be
given upon receipt.
Section 12.5 Delays or Omissions. No delay or omission to exercise any right,
power or remedy hereunder shall impair any such right, power or remedy of any
party hereto, nor shall it be construed to be a waiver of any such breach or
default, or an acquiescence therein, or of or in any similar breach or default
thereafter occurring. Any waiver, permit, consent or approval of any kind or
character on the part of any party hereto of any breach or default under this
Agreement, or any waiver on the part of any party hereto of any provisions or
conditions of this Agreement, must be in writing and shall be effective only to
the extent specifically set forth in such writing or as provided in this
Agreement. Except as provided in Article 11, remedies, either under this
Agreement or by law or equity or otherwise afforded to any party hereto, shall
be cumulative and not alternative.
Section 12.6 Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, and all of which taken
together shall constitute one and the same instrument.
Section 12.7 Severability. In the event that any provision of this Agreement
becomes or is declared by a court of competent jurisdiction to be illegal,
unenforceable or void, this Agreement shall continue in full force and effect
without said provision; provided that no such
-44-
51
severability shall be effective if it materially changes the economic benefit
of this Agreement to any party.
Section 12.8 Headings. The subject headings of the sections of this Agreement
are included for purposes of convenience only and shall not affect the
construction or interpretation of any of its provisions.
Section 12.9 Arbitration. Any dispute arising hereunder (other than a dispute
relating to a breach or potential breach of covenants to be performed after the
Closing, including Section 6.20(c) and 11.5, which may be brought before a
court) shall be settled by arbitration in accordance with the Commercial
Arbitration Rules of the American Arbitration Association and judgment on the
award rendered by the arbitrator may be entered in any court having
jurisdiction. Such arbitration shall be conducted in Washington, D.C.
Section 12.10 Exclusive Benefit. Nothing in this Agreement is intended to confer
any rights or remedies, whether express or implied, under or by reason of this
Agreement, on any persons other than the parties hereto and their respective
successors and assigns, nor is anything in this Agreement intended to relieve or
discharge the obligation or liability of any third persons to any party to this
Agreement.
Section 12.11 Construction. The parties have participated jointly in the
negotiation and drafting of this Agreement. In the event an ambiguity or
question of intent or interpretation arises, this Agreement shall be construed
as if drafted jointly by the parties and no presumption or burden of proof shall
arise favoring or disfavoring any party by virtue of the authorship of any of
the provisions of this Agreement. Any reference to any federal, state, local or
foreign statute or law shall be deemed also to refer to all rules and
regulations promulgated thereunder, unless the context requires otherwise. The
parties intend that each representation, warranty and covenant contained herein
shall have independent significance. If any party has breached any
representation, warranty or covenant contained herein in any respect, the fact
that there exists another representation, warranty or covenant relating to the
same subject matter (regardless of the relative levels of specificity) which the
party has not breached shall not detract from or mitigate the fact that the
Party is in breach of the first representation, warranty, or covenant.
Section 12.12 Exhibits and Schedules. The Exhibits and Schedules identified in
this Agreement are incorporated herein by reference and made a part hereof. Any
item disclosed on a Schedule hereto shall be deemed to be disclosed on any other
applicable Schedule hereto if and to the extent such disclosure would reasonably
be deemed applicable to such other Schedule based on the text of such disclosure
(except that items disclosed on Schedule 5.9 shall not be deemed disclosed on
Schedule 5.16).
Section 12.13 Time is of the Essence.Time is of the essence in this Agreement.
-45-
52
IN WITNESS WHEREOF, each party hereto has caused this Agreement to
be duly executed as of the day and year first above written.
NORTHWEST BROADCASTING, L.P.
By: Northwest Broadcasting, Inc., its general partner
By: /s/ Xxxxx X. Xxxxx
_______________________
Name: Xxxxx X. Xxxxx
_______________________
Title: President
_______________________
SPECTRASITE HOLDINGS, INC.
By: /s/ Xxxxxxx X. Xxxxx
________________________
Name: Xxxxxxx X. Xxxxx
________________________
Title: President and Chief
Executive Officer
________________________
