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Exhibit 2.2
SECURITIES PURCHASE AGREEMENT
THIS SECURITIES PURCHASE AGREEMENT (the "Agreement") is
dated as of October 22, 1999 by and between East/West Communications, Inc.,
a Delaware corporation (the "Issuer"), and Omnipoint Corporation, a Delaware
corporation ("Omnipoint", or the "Purchaser").
RECITALS
WHEREAS, concurrently herewith, Issuer and Omnipoint are
entering into an Agreement and Plan of Merger (the "Merger Agreement"),
pursuant to which, among other things, the Issuer will merge with and into
Omnipoint; and
WHEREAS, upon the terms and conditions set forth in this
Agreement, Issuer has determined to issue and sell, and Purchaser have
determined to purchase, 300,000 shares of Issuer's Class A Common Stock, par
value $0.01 per share (the "Stock");
WHEREAS, the Issuer and the Purchaser desire to set
forth certain rights of the Purchaser with respect to the Stock; and
WHEREAS, it is a condition to the purchase and sale of
the Stock hereunder that the Merger Agreement continue to be in full force
and effect on the closing date of such purchase and sale of Stock.
AGREEMENT
NOW, THEREFORE, in consideration of the mutual
covenants, conditions and promises hereinafter set forth, the parties hereby
agree as follows:
ARTICLE I
PURCHASE AND SALE OF STOCK
Section 1.1 Closing. Subject to the terms and conditions of this
Agreement, at the Closing, Issuer will issue, sell and deliver 300,000 shares of
Stock to Omnipoint for a purchase price of $10 per share payable to Issuer on
the Closing Date.
Section 1.2 Conversion Rights. In the event that between the Closing
Date and the earlier of (i) the Effective Time and (ii) the date on which the
Merger Agreement is terminated, the Issuer issues any shares of Additional
Company Capital Stock (as defined in the Merger Agreement) (other than Company
Common Stock), the Purchaser shall have the right, at its sole option, to
convert all or a portion of its Stock into shares of Additional Company Capital
Stock issued by the Issuer in any Issuance pursuant to and in accordance with
Section 6.2 of the Merger Agreement (the "Conversion Right"). The Purchaser
shall have the right to convert its Stock on the same terms and conditions as
any other purchaser of shares of such Additional Company Capital Stock pursuant
to such
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Issuance. In the event that the Purchaser exercises the Conversion Right
and converts a portion of its Stock into shares of Additional Company Capital
Stock in accordance herewith, notwithstanding anything to the contrary contained
herein, the Converted Shares shall be automatically converted into shares of
Issuer's Class A Common Stock on the Right of First Refusal End Date based on a
purchase price of $10 per share of Issuer's Class A Common Stock.
Section 1.3 Use of Proceeds. Issuer shall use the
proceeds from the sale of the Stock to (i) repay the principal and interest on
loans from the Federal Communications Commission relating to the Issuer's PCS
licenses, and (ii) pay certain legal and accounting expenses incurred in
connection with this Agreement and the transactions contemplated by this
Agreement and the Merger Agreement and general corporate purposes, subject to
the limitations set forth in Section 6.4. Issuer agrees to use any remaining
proceeds to redeem Company Preferred Stock for the Per Share Exchange Amount
immediately prior to the Effective Time, unless, in each case, the Issuer or
Omnipoint should determine that such payment would result in Omnipoint acquiring
less than ninety percent (90%) of the fair market value of the Issuer's "net
assets" and less than seventy percent (70%) of the fair market value of the
Issuer's "gross assets", measured for this purpose, immediately prior to the
Effective Time pursuant to the Merger Agreement. For purposes of determining the
percentage of the Issuer's "net assets" and "gross assets" to be acquired by
Omnipoint, the following assets will be treated as held by the Issuer
immediately prior to, but not acquired by Omnipoint pursuant to the Merger: (i)
assets disposed of by the Issuer prior to the Merger and in contemplation
thereof (including, without limitation, any assets disposed of by the Issuer,
other than in the ordinary course of business, pursuant to a plan or intention
existing during the period ending on the Closing Date (as defined in the Merger
Agreement) and beginning with the commencement of negotiations (whether formal
or informal) with Omnipoint regarding the Merger); (ii) assets used by the
Issuer to pay the Issuer's stockholders, if any, who perfect dissenters' rights
in connection with the Merger; (iii) assets used by the Issuer to pay
reorganization expenses or other liabilities incurred in connection with the
Merger; and (iv) assets used to make distributions, redemptions or other
payments (except for regular, normal distributions) in respect of the capital
stock of the Issuer (including payments treated as such for tax purposes) that
are made prior to the Merger and are part of the plan of the Merger.
ARTICLE II
CLOSING
Section 2.1 Time and Place of Closing. Subject to the conditions set
forth in Section 8.1, the closing of the transactions contemplated by Section
3.1 (the "Closing") shall take place at the offices of Piper & Marbury L.L.P.,
0000 Xxxxxxxxxx Xxxxxx, X.X., Xxxxxxxxxx, X.X. 00000, at 10:00 a.m. local time
on the date hereof (the "Closing Date"). At the Closing, Issuer shall deliver to
Purchaser duly executed and issued stock certificates evidencing the Shares
purchased thereby against payment of the purchase price therefor by wire
transfer of immediately available funds to the account specified therefor by
Issuer.
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ARTICLE III
REPRESENTATIONS AND WARRANTIES OF ISSUER
Section 3.1 Representations and Warranties of Issuer.
The Issuer hereby represents and warrants to the Purchaser:
(1) Incorporation of Representations and
Warranties in Merger Agreement. The representations and warranties of Issuer
set forth in Section 4 of the Merger Agreement (together with the Disclosure
Schedule) are hereby incorporated herein by reference, and are hereby made by
Issuer to Purchaser as of the date hereof and the Closing Date, in their
entirety with the same force and effect.
(2) Additional Representations and Warranties.
Issuer hereby represents and warrants to Purchaser the shares of Stock
being issued to Purchaser hereunder, when issued and paid for pursuant to the
terms of this Agreement, will be duly authorized, validly issued, fully paid and
nonassessable, and will be free and clear of any Liens, and shall not be subject
to any preemptive rights of the holders of any other class or series of the
capital stock of Issuer.
(3) Power and Authority; No Violation. The
Issuer has full power and authority to execute, deliver and perform its
obligations under this Agreement and to consummate the transactions contemplated
hereby. This Agreement and all transactions contemplated hereby have been duly
and validly authorized by all necessary action on the part of Issuer and this
Agreement constitutes a legal, valid and binding obligation of Issuer
enforceable in accordance with its terms except as such enforceability may be
limited by bankruptcy, insolvency, moratorium or other similar laws affecting or
relating to enforcement of creditors' rights generally. Neither the execution,
delivery or performance of this Agreement nor the consummation of the
transactions contemplated hereby by Issuer will, with or without the giving of
notice or the passage of time, or both, (i) conflict with, result in a default
or loss of rights (or give rise to any right of termination, cancellation or
acceleration) under, or result in the creation of any Lien, pursuant to (A) any
provision of the certificate of incorporation, by-laws, stockholders agreements
or other constituent documents of Issuer; (B) any material note, bond,
indenture, mortgage, deed of trust, contract, agreement, lease or other
instrument or obligation to which Issuer is a party or by which Issuer or its
property may be bound or affected; or (C) any law, order, judgment, ordinance,
rule, regulation or decree to which Issuer is a party or by which it or its
property is bound or affected, other than such exceptions in the case of
subclauses (A), (B) and (C) which would not reasonably be expected to have a
material adverse effect on the transactions contemplated hereby or on the
Issuer; (ii) give rise to any right of first refusal or similar right with
respect to any interest, or any properties or assets, of Issuer; or (iii) give
rise to the Company's right to redeem any shares of Stock. No permit, consent,
approval, authorization, qualification or registration of, or declaration to or
filing with, any governmental or regulatory authority or agency or third party
is required to be obtained or made by Issuer in connection with the execution
and delivery of this Agreement or the consummation of the transactions
contemplated hereby or thereby in order to (A) render this Agreement or the
transactions contemplated hereby or thereby valid and effective and (B) enable
Issuer to sell the Stock.
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(4) Legal Matters. There is no claim, legal
action, counterclaim, suit, arbitration, governmental investigation or other
legal, administrative or tax proceeding, nor any order, decree or judgment, in
progress or pending, or to the knowledge of Issuer threatened, against the
Issuer relating to the right of Issuer to perform its obligations under this
Agreement, nor does Issuer know or have reason to be aware of any basis for the
same. There is outstanding no order, writ, injunction, judgment or decree of any
court, governmental agency or arbitration tribunal applicable to Issuer or
binding upon it or its property which would individually or in the aggregate
impair in any material respect the performance of the obligations of Issuer
hereunder or the consummation of the transactions contemplated by this Agreement
other than orders or decrees involving the wireless telephone industry in
general.
(5) Investment Company Act. Issuer is not an
"investment company" within the meaning of the Investment Company Act of 1940,
as amended.
(6) No Brokers. Except with respect to the
$150,000 placement fee to be paid by the Issuer to Gabelli & Company, Inc. upon
consummation of the transactions contemplated by this Agreement, no agent,
broker, investment banker, person or firm is or will be entitled to any broker's
or finder's fee or any other commission or similar fee directly or indirectly in
connection with such transactions based in any way on any arrangements,
agreements or understandings made by or on behalf of Issuer or an affiliate
thereof, as defined in Rule 405 under the Securities Act of 1933, as amended (an
"Affiliate"), and Issuer hereby agrees to indemnify the Investor and agrees to
hold harmless the Investor against and in respect of any claims for brokerage
and other commissions relating to such transactions based in any way on any
arrangements, agreements or understandings made by or on behalf of Issuer or an
Affiliate thereof.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF PURCHASER
The Purchaser hereby represents and warrants to Issuer:
Section 4.1 Authorization. It has the full power and
authority to enter into this Agreement and to perform all of its obligations
hereunder. The execution, delivery and performance of this Agreement by it have
been duly authorized by all necessary corporate action, and this Agreement
constitutes a valid and binding obligation of it enforceable against it in
accordance with its terms except as may be limited by bankruptcy, insolvency,
reorganization, moratorium and other similar laws affecting creditors' rights
generally and by equitable principles of general applicability. The execution,
delivery and performance of this Agreement by it do not (a) violate any
provision of its certificate of incorporation, by-laws or other constituent
documents, (b) conflict with or constitute a default under any material
agreement, indenture or instrument to which it is a party or by which it or its
property is bound or (c) violate any statute or order of any court or
Governmental Body applicable to it, except in each case set forth in clauses (b)
or (c) which would not reasonably be expected to have a material adverse effect
on its business taken as a whole or the transactions contemplated hereby.
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Section 4.2 Investment Representations. It is an
Accredited Investor within the definition set forth in Rule 501(a) under the
Securities Act of 1933, as amended (the "Securities Act"). It is acquiring the
Shares it is purchasing hereunder for its own account, for investment, and not
with a view to, or for sale in connection with, the distribution thereof or of
any interest therein, in violation of state or federal law. It understands that
such shares have not been registered under the Securities Act, and that such
Shares may not be sold or otherwise disposed of unless registered under the
Securities Act and applicable state securities laws or exempted from
registration therefrom.
ARTICLE V
REGISTRATION RIGHTS
Section 5.1 Demand Registrations.
(1) Right to Demand Registration. In the event
that the Merger Agreement is terminated (other than pursuant to Section
10.1(d) of the Merger Agreement), the holders of not less than twenty (20%)
percent of the shares of Stock beneficially owned by the Purchaser (the
"Registrable Securities") (collectively, the "Offerors"), may request
registration under the Securities Act of all or part of their Registrable
Securities. Within seven days after receipt of any such request, Issuer will
give written notice of such request to all other holders of securities of the
Issuer entitled to notice of or the right to participate in such registrations
("Other Registrable Securities") and will include in such registration all Other
Registrable Securities with respect to which Issuer has received written
requests for inclusion therein within 20 days after the receipt of Issuer's
notice. A registration requested pursuant to this Section 5.1(a) is referred to
herein as a "Demand Registration".
A request pursuant to this Section shall state the
number of Registrable Securities requested to be registered, the intended method
of disposition thereof and the jurisdictions in which registration is desired.
In connection with any registration subject to this Section 5.1(a), the holders
of Registrable Securities included in such registration shall enter into such
underwriting, lock-up and other agreements, and shall execute and complete such
questionnaires and other documents, as are customary in a primary offering.
(2) Number of Demand Registrations. The holders
of Registrable Securities will be entitled to request two (2) Demand
Registrations, and Issuer will pay all Registration Expenses in connection
therewith. A registration will not constitute a Demand Registration (i) until it
has become effective, or (ii) if after it has become effective, the offering of
Registrable Securities pursuant to such registration is interfered with by any
stop order, injunction or other order or requirement of the SEC or other
governmental agency or court.
(3) Priority on Demand Registrations. Issuer
will not include in any Demand Registration any securities which are not
Registrable Securities or Other Registrable Securities without the written
consent of the Offerors not to be unreasonably withheld (and the Offerors may
not withhold their written consent if the Demand Registration is an underwritten
offering and the managing underwriters advise Issuer and the Offerors in writing
that in their opinion the number of Registrable Securities and other securities
requested to be included therein does not exceed the
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number of securities which can be sold in such offering without materially
adversely affecting such sale). If Other Registrable Securities are permitted to
be included in a Demand Registration which is an underwritten offering and the
managing underwriters advise Issuer in writing that in their opinion the number
of Registrable Securities and Other Registrable Securities requested to be
included exceeds the number of securities which can be sold in such offering
without materially adversely affecting such sale, Issuer will include in such
registration prior to the inclusion of any securities which are not Registrable
Securities the number of Registrable Securities requested to be included which
in the opinion of such managing underwriters can be sold, pro rata among the
respective holders of such Registrable Securities on the basis of the amount of
such securities owned.
(4) Restrictions on Demand Registrations.
Issuer may postpone for up to three months in the aggregate during any twelve
month period any filing or the effectiveness of any registration statement for a
Demand Registration if the Board of Directors of Issuer determines (and Issuer
so certifies by written notice to the Offerors) that such Demand Registration
might reasonably be expected to have an adverse effect on any proposal or plan
by Issuer or any of its Subsidiaries to engage in any material corporate
transaction; provided that in such event, the Offerors initiating the request
for such Demand Registration will be entitled to withdraw such request.
(5) Selection of Underwriters. In the case of a
Demand Registration, the Offerors will have the right to select the
investment banker(s) and manager(s) to administer the offering, subject to
Issuer's approval which will not be unreasonably withheld.
Section 5.2 Piggyback Registrations.
(1) Right to Piggyback Registrations. Whenever
Issuer proposes to register any of its Common Stock under the Securities Act
(other than any registration SEC Form S-4 or SEC Form S-8 or any successor
forms), Issuer will give prompt written notice (in any event within ten business
days after its receipt of notice of any exercise of other demand registration
rights) to the holders of Registrable Securities of its intention to effect such
a registration and will use its best efforts to include in such registration all
Registrable Securities with respect to which Issuer has received written
requests for inclusion therein within 20 days after the receipt of Issuer's
notice by such holders. A request pursuant to this Section 5.2(a) shall state
the number of Registrable Securities requested to be registered. In connection
with any registration subject to this Section 5.2(a), the holders of Registrable
Securities included in such registration shall enter into such underwriting,
lock-up and other agreements, and shall execute and complete such questionnaires
and other documents, as are customary in a secondary offering. Issuer shall have
the right to terminate or withdraw any registration initiated by it under this
Section 5.2(a) prior to the effectiveness of such registration whether or not
any holders of Registrable Securities have elected to include any securities in
such registration. All registrations requested pursuant to this Section 5.2(a)
are referred to herein as "Piggyback Registrations". No registration effected
under this Section 5.2(a) shall relieve Issuer of its obligation to effect a
Demand Registration pursuant to Section 5.1.
(2) Priority on Primary Registrations. If a
Piggyback Registration is an underwritten primary registration on behalf of
Issuer, and the managing underwriters advise Issuer
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in writing that in their opinion the number of securities requested to be
included in such registration exceeds the number which can be sold without
materially adversely affecting such sale, Issuer will include in such
registration (regardless of whether any holder initially requested such
registration) (i) first, the securities Issuer proposes to sell, (ii) second,
those Registrable Securities requested to be included by the holders thereof
which in the opinion of such managing underwriters can be sold, pro rata among
the respective holders thereof on the basis of the amount of such securities
owned, and (iii) third, all Other Registrable Securities requested to be
included in such registration, pro rata among the holders thereof on the basis
of the number of shares owned by such holders.
(3) Priority on Secondary Registrations. If a
Piggyback Registration is an underwritten secondary registration on behalf
of holders of Issue's securities (and in which Issuer is not issuing any
securities under such registration), and the managing underwriters advise Issuer
in writing that in their opinion the number of securities requested to be
included in such registration exceeds the number which can be sold without
materially adversely affecting such offering, Issuer will include in such
registration (i) first, the securities requested to be included in such
registration by the holder or holders who requested such registration (such
holders being entitled to participate in accordance with the relative
priorities, if any, as may exist among them) and (ii) second, Registrable
Securities and all Other Registrable Securities requested to be included in such
registration, pro rata among the holders thereof on the basis of the number of
shares owned by such holders.
(4) Selection of Underwriters. In the case of a
Piggyback Registration which is a primary registration on behalf of
Issuer, Issuer will have the right to select any investment banker(s) and
manager(s) of nationally recognized standing to administer the offering.
Section 5.3 No Inconsistent Agreement. Any right given
by Issuer to any holder or prospective holder of Issuer's securities in
connection with the registration of securities shall be conditioned such that it
shall be consistent with the rights of the holders of Registrable Securities
provided in this Agreement and shall not materially adversely affect the right
of the holders of Registrable Securities to participate in Piggyback
Registrations in the manner set forth in this Agreement.
Section 5.4 Lockup Agreement.
(1) Each Purchaser agrees, and prior to
transferring Registrable Securities will cause its proposed transferee to agree,
if requested by Issuer and the managing underwriters of Registrable Securities,
not to sell or otherwise transfer or dispose of any other Registrable Securities
(or other securities) of Issuer for a period not to exceed 30 days prior to or
up to 180 days following the effective date of a registration statement of
Issuer filed under the Securities Act, provided that all officers and directors
and stockholders owning ten percent (10%) or more (on a fully diluted basis,
treating all outstanding options, rights and warrants to acquire equity
securities of Issuer as fully exercised, and treating all securities convertible
into or exchangeable for equity securities of Issuer as fully converted or
exchanged) of Issuer's equity securities shall enter into similar agreements.
Such agreement shall be in writing in a form satisfactory to Issuer and such
underwriter. Issuer may
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impose stop transfer instructions with respect to the shares (or securities)
subject to the foregoing restriction until the end of said 90-day period.
(2) Issuer agrees not to effect any public sale
or distribution of its equity securities, or any securities convertible
into or exchangeable or exercisable for such securities, during the ten days
prior to and during the 90-day period beginning on the effective date of any
underwritten Demand Registration (except as part of such underwritten
registration or pursuant to registrations on Form S-4 or Form S-8 or any
successor form or forms not available for registering capital stock for sale to
the public at large), unless all of the Registrable Securities included in such
registration have been sold.
Section 5.5 Termination of Certain Rights and
Obligations. Notwithstanding the foregoing provisions of this Agreement, the
rights to registration pursuant to Sections 5.1 and 5.2, the obligations of
Purchaser pursuant to Section 5.4(1), and the obligations of Issuer and the
holders of 25% or more of its equity securities pursuant to Section 5.4(2) shall
terminate as to any particular Registrable Securities that shall have been (a)
sold in a registered public offering, (b) sold through a broker, dealer or
underwriter in a public distribution or a public securities transaction in which
the transferee receives a certificate without a securities legend, (c) sold or
distributed pursuant to Rule 144 or (d) eligible for sale under Rule 144 within
a 60-day period.
Section 5.6 Registration Procedures. Whenever the
Offerors have requested that any Registrable Securities be registered pursuant
to this Agreement, Issuer will use its best efforts to effect the registration
and the sale of such Registrable Securities in accordance with the intended
method of disposition thereof, and pursuant thereto Issuer will expeditiously:
(1) prepare and file with the SEC a registration
statement with respect to such Registrable Securities and use its best
efforts to cause such registration statement to become and remain effective for
a period of not less than three months; provided that before filing a
registration statement or prospectus or any amendments or supplements thereto,
Issuer will furnish to the counsel selected by the Offerors requesting such
registration statement copies of all such documents proposed to be filed, which
documents will be subject to the review of such counsel before such filing is
made, and Issuer will comply with any reasonable request made by such counsel to
make changes to the extent such documents do not comply in all material respects
with the Securities Act;
(2) prepare and file with the SEC such amendments
(including post-effective amendments) and supplements to such registration
statement and the prospectus used in connection therewith as may be necessary to
keep such registration statement effective for a period of not less than three
months and to comply with the provisions of the Securities Act with respect to
the disposition of all securities covered by such registration statement during
such period in accordance with the intended methods of disposition by the
sellers thereof set forth in such registration statement;
(3) furnish to each seller of Registrable
Securities such number of conformed copies of such registration statement, each
amendment and supplement thereto (in each case including all exhibits), the
prospectus included in such registration statement (including each preliminary
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prospectus) and such other customary documents as such seller may reasonably
request in order to facilitate the disposition of the Registrable Securities
owned by such seller;
(4) use its best efforts to register or qualify
such Registrable Securities under such other securities or blue sky laws of
such jurisdictions as any seller reasonably requests and do any and all other
acts and things which may be reasonably necessary or advisable to enable such
seller to consummate the disposition in such jurisdictions of the Registrable
Securities owned by such seller (provided that Issuer will not be required to
(i) qualify generally to do business in any jurisdiction where it would not
otherwise be required to qualify but for this subparagraph, (ii) subject itself
to taxation in any such jurisdiction, or (iii) consent to service of process
except as required by the securities or blue sky laws in any such jurisdiction);
(5) notify each seller of such Registrable
Securities at any time when a prospectus relating thereto is required to be
delivered under the Securities Act of Issuer's becoming aware that the
prospectus included in such registration statement, as then in effect, contains
an untrue statement of a material fact or omits any material fact necessary to
make the statements therein not misleading in light of the circumstances under
which they were made, and, at the written request of any such seller, Issuer
will prepare a supplement or amendment to such prospectus so that, as thereafter
delivered to the Purchaser of such Registrable Securities, such prospectus will
not contain an untrue statement of a material fact or omit to state any material
fact necessary to make the statements therein not misleading in light of the
circumstances under which they were made;
(6) use its best efforts to cause all such
Registrable Securities covered by such registration statement to be listed or
quoted on the principal securities exchange or national automated quotation
system, if any, on which similar securities issued by Issuer are then listed or
quoted.
(7) provide a transfer agent and registrar for
all such Registrable Securities covered by such registration statement not
later than the effective date of such registration statement;
(8) in the event the offering is an underwritten
offering, use its best efforts to obtain a "cold comfort" letter from the
independent public accountants for Issuer in customary form and covering such
matters of the type customarily covered by such letters;
(9) enter into such customary agreements
(including underwriting agreements in customary form) and take all such other
actions as the holders of a majority of the Registrable Securities being sold or
the underwriters, if any, reasonably request in order to expedite or facilitate
the disposition of such Registrable Securities; and
(10) upon execution and delivery of such
customary confidentiality agreements as Issuer shall reasonably request, make
available for inspection by any seller of Registrable Securities covered by such
registration statement, any underwriter participating in any disposition
pursuant to such registration statement, and any attorney, accountant or other
agent retained by any such seller or underwriter, all pertinent financial and
other records, pertinent corporate documents and properties
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of Issuer, and cause Issuer's officers, directors, employees and independent
accountants to supply all information reasonably requested by any such seller,
underwriter, attorney, accountant or agent in connection with such registration
statement.
Issuer will make generally available to the holders of
Registrable Securities an earnings statement (which need not be audited) for
the twelve months beginning after the effective date of a registration statement
as soon as reasonably practicable after the end of such period, which earnings
statement shall satisfy Section 11(a) of the Securities Act.
Issuer will, at all times after Issuer has filed a
registration statement with the SEC pursuant to the requirements of either the
Securities Act or the Exchange Act, file all reports required to be filed by it
under the Securities Act and the Exchange Act and the rules and regulations
adopted by the SEC thereunder, and take such further action as any holder or
holders of Registrable Securities may reasonably request, all to the extent
required to enable such holders to be eligible to sell Registrable Securities
pursuant to Rule 144 adopted by the SEC under the Securities Act, as such rule
may be amended from time to time, or any successor rule or regulation hereafter
adopted by the SEC. Upon request, Issuer will deliver to holders of Registrable
Securities a written statement as to whether it has complied with such
requirements.
Section 5.7 Registration Expenses.
(1) All expenses incident to Issuer's
performance of or compliance with this Agreement, including, without limitation,
all registration and filing fees, fees and expenses of compliance with
securities or blue sky laws, word processing, duplicating and printing expenses,
messenger and delivery expenses, and fees and disbursements of counsel for
Issuer and all independent certified public accountants (including, but not
limited to, fees and disbursements relating to the "cold comfort" letter
described in Section 5.6(8)) and other Persons retained by Issuer (all such
expenses being herein called "Registration Expenses"), will be borne by Issuer.
Discounts and commissions to underwriters shall not be considered Registration
Expenses for purposes of this Agreement and will be borne by the holders of
Registrable Securities. Issuer will, in any event, pay its internal expenses
(including, without limitation, all salaries and expenses of its officers and
employees performing legal or accounting duties), the expense of any annual
audit or quarterly review, the expense of any liability insurance and the
expenses and fees for listing the securities to be registered on each securities
exchange on which similar securities issued by Issuer are then listed or on a
national automated quotation system.
(2) In connection with each Demand Registration
and Piggyback Registration, Issuer will reimburse the holders of Registrable
Securities covered by such registration for the reasonable fees and
disbursements of one counsel chosen by the holders of a majority of the
Registrable Securities included in such registration, provided that the costs
and expenses of such counsel in connection with any such registration will not
exceed $25,000.
(3) To the extent expenses are not required to
be paid by Issuer, each holder of securities included in any registration
hereunder will pay those expenses allocable to the registration
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of such holder's securities so included, and any expenses not so allocable will
be borne by all sellers of securities included in such registration in
proportion to the aggregate selling price of the securities to be so registered.
Section 5.8 Indemnification.
(1) In the event of any registration of any
Registrable Securities under the Securities Act pursuant to this Agreement,
Issuer agrees to indemnify, to the fullest extent permitted by law, each holder
of Registrable Securities covered by the applicable registration statement, its
respective officers, directors, shareholders or general or limited partners or
members and each Person who controls such holder within the meaning of the
Securities Act (each, a "Purchaser Indemnitee"), as follows:
(2) against all losses, claims, damages,
liabilities and expenses to which a Purchaser Indemnitee may become subject
under the Securities Act, common law or otherwise, insofar as such losses,
claims, damages, liabilities or expenses arise out of or are caused by any
untrue or alleged untrue statement of material fact contained in any
registration statement, prospectus or preliminary prospectus or any amendment
thereof or supplement thereto relating to such securities or any omission or
alleged omission of a material fact required to be stated therein or necessary
to make the statements therein not misleading in light of the circumstances
under which they were made, except insofar as the same are caused by or
contained in any information furnished in writing to Issuer by any holder of
Registrable Securities expressly for use therein or by any holder of Registrable
Securities' failure to deliver a copy of the registration statement or
prospectus or any amendments or supplements thereto;
(3) against all losses, claims, damages,
liabilities and expenses to the extent of the aggregate amount paid in
settlement of any litigation, or investigation or proceeding by any governmental
agency or body, commenced or threatened, or of any claim whatsoever based upon
any such untrue statement of a material fact or omission of a material fact, or
any such alleged untrue statement of a material fact or omission of a material
fact, if such settlement is effected with the prior written consent of Issuer,
except insofar as the same are caused by or contained in any information
furnished in writing to Issuer by any holder of Registrable Securities expressly
for use therein or by any holder's failure to deliver a copy of the registration
statement or prospectus or any amendments or supplements thereto; and
(4) against all expenses reasonably incurred by
such holder in connection with investigating, preparing or defending against any
litigation, or investigation or proceeding by any governmental agency or body,
commenced or threatened, or any claim whatsoever based upon any such untrue
statement of a material fact or omission of a material fact, or any such alleged
untrue statement of a material fact or omission of a material fact, to the
extent that any such expense is not paid under clause (i) or (ii) above, except
insofar as the same are caused by or contained in any information furnished in
writing to Issuer by any holder of Registrable Securities expressly for use
therein or by such holder's failure to deliver a copy of the registration
statement or prospectus or any amendments or supplements thereto.
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In connection with an underwritten offering, Issuer will indemnify such
underwriters, their officers and directors and each Person who controls such
underwriters within the meaning of the Securities Act to the same extent as
provided above with respect to the indemnification of the Purchaser Indemnitees.
(5) In connection with any registration
statement in which a holder of Registrable Securities is participating, each
such holder will furnish to Issuer in writing such information and affidavits as
Issuer reasonably requests for use in connection with any such registration
statement or prospectus and, to the extent permitted by law, will indemnify
Issuer, its directors and officers and each Person who controls Issuer within
the meaning of the Securities Act (each, an "Issuer Indemnitee") against any
losses, claims, damages, liabilities and expenses resulting from any untrue
statement of material fact contained in the registration statement, prospectus
or preliminary prospectus or any amendment thereof or supplement thereto or any
omission of a material fact required to be stated therein or necessary to make
the statements therein not misleading, but only to the extent that such untrue
statement or omission is contained in any information or affidavit so furnished
in writing by such holder expressly for use in the preparation of such
registration statement, prospectus or preliminary prospectus; provided that the
obligation to indemnify will be several, not joint and several, among such
holders of Registrable Securities and the liability of each such holder of
Registrable Securities will be in proportion to and limited to the net amount
received by such holder from the sale of Registrable Securities pursuant to such
registration statement, prospectus or preliminary prospectus.
(6) Any Person entitled to indemnification
hereunder will (i) give prompt written notice to the indemnifying party of any
claim with respect to which it seeks indemnification and (ii) unless in such
indemnified party's reasonable judgment a conflict of interest between such
indemnified and indemnifying parties may exist with respect to such claim,
permit such indemnifying party to assume the defense of such claim with counsel
reasonably satisfactory to the indemnified party. If such defense is assumed,
the indemnifying party will not be subject to any liability for any settlement
made by the indemnified party without its consent (but such consent will not be
unreasonably withheld). An indemnifying party who is not entitled to, or elects
not to, assume the defense of a claim will not be obligated to pay the fees and
expenses of more than one counsel for all parties indemnified hereunder by such
indemnifying party with respect to such claim, unless in the reasonable judgment
of any indemnified party a conflict of interest may exist between such
indemnified party and any other of such indemnified parties with respect to such
claim in which case such indemnified party shall have the right to employ one
counsel. Failure to give prompt written notice shall not release the
indemnifying party from its obligations hereunder, except to the extent that the
indemnifying party is actually prejudiced by such failure to give notice.
(7) The indemnification provided for under this
Agreement will remain in full force and effect regardless of any
investigation made by or on behalf of the indemnified party or any officer,
director or controlling Person of such indemnified party and will survive the
transfer of securities. Issuer also agrees to make such provisions as are
reasonably requested by any indemnified party for contribution to such party in
the event Issuer's indemnification is unavailable for any reason.
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Section 5.9 Contribution. In order to provide for just
and equitable contribution in circumstances under which the indemnity
contemplated by Section 5.8 is for any reason not available, the parties
required to indemnify by the terms thereof shall contribute to the aggregate
losses, claims, damages, liabilities and expenses of the nature contemplated by
such indemnity agreement incurred by any Purchaser Indemnitee, any Issuer
Indemnitee and one or more of the underwriters, except to the extent that
contribution is not permitted under Section 11(f) of the Securities Act. In
determining the amounts which the respective parties shall contribute, there
shall be considered the parties' relative fault concerning the matter with
respect to which the claim was asserted, knowledge and access to information
concerning the matter with respect to which the claim was asserted, the
opportunity to correct and prevent any statement or omission and any other
equitable considerations appropriate under the circumstances. Issuer and each
Person selling securities agree with each other that no seller of Registrable
Securities shall be required to contribute any amount in excess of the amount
such seller would have been required to pay to an indemnified party if the
indemnity under Section 6.8 were available. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. Issuer and each such seller agree with each other,
and the underwriters of the Registrable Securities if requested by such
underwriters, that it would not be equitable if the amount of such contribution
were determined by pro rata or per capita allocation (even if the underwriters
were treated as one entity for such purpose) or for the underwriters' portion of
such contribution to exceed the percentage that the underwriting discount bears
to the initial public offering price of the Registrable Securities. For purposes
of this Section 5.9, each Person, if any, who controls an underwriter within the
meaning of Section 15 of the Securities Act shall have the same rights to
contribution as such underwriter, and each director and each officer of Issuer
who signed the registration statement, and each Person, if any, who controls
Issuer or a seller of Registrable Securities within the meaning of Section 15 of
the Securities Act, shall have the same rights to contribution as Issuer or a
seller of Registrable Securities, as the case may be.
Section 5.10 Participation in Underwritten Registrations.
No Person may participate in any registration hereunder which is underwritten
unless such Person (a) agrees to sell such Person's securities on the basis
provided in any underwriting arrangements approved by the Person or Persons
entitled hereunder to approve such arrangements and (b) completes and executes
all questionnaires, powers of attorney, indemnities, underwriting agreements and
other documents required under the terms of such underwriting arrangements.
Section 5.11 Recapitalization of Nonvoting Stock. At any
time any holder of non-voting Registrable Securities wishes to sell such shares
pursuant to a public offering of shares of voting common stock, Issuer shall
cause such shares to be recapitalized into or exchanged for shares of voting
common stock, such recapitalization or exchange to become effective at such time
as the registration statement pertaining to such shares has been filed with and
declared effective by the SEC.
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ARTICLE VI
ADDITIONAL RIGHTS AND COVENANTS
Section 6.1 Cooperation and Full Access. Issuer shall
give to Purchaser and its counsel, accountants, advisers and other
representatives, reasonable access at all times during reasonable business hours
and on reasonable notice, to all the offices, properties, contracts, books,
records, personnel and affairs of Issuer or in any way relating to or connecting
with the business or its assets. Issuer shall furnish, and shall direct its
independent accountants and legal counsel to furnish, to Purchaser all such
documents and information concerning the assets, properties, liabilities and
affairs of Issuer as Purchaser may from time to time reasonably request.
Section 6.2 Right of First Refusal. Subject to Paragraph
(9) of this Section 6.2, in the event that the Merger Agreement is terminated
for any reason (other than pursuant to Section 10.1(d) of the Merger Agreement),
Purchaser shall have a right of first refusal (the "Right of First Refusal")
with respect to the sale, exchange or other disposition of any or all of the PCS
licenses held by Issuer (each, a "PCS License" and collectively, the "PCS
Licenses") other than any sale, exchange or other disposition of any PCS License
to any Affiliate of Issuer who agrees to be bound by and comply with the
provisions of this Section 6.2. In the event that the Merger Agreement is
terminated for any reason (other than pursuant to Section 10.1(d) of the Merger
Agreement), Issuer shall not sell, exchange or otherwise dispose of any PCS
License (other than any sale, disposition or exchange of any PCS License to any
Affiliate of Issuer who agrees to be bound by and comply with the provisions of
this Section 6.2) unless it shall have first complied with this Section 6.2. The
Right of First Refusal shall operate as set forth below, and extend for two (2)
years from the date of termination of the Merger Agreement:
(1) Within three (3) business days of
commencement of the negotiation of a term sheet, letter of intent, or letter of
interest, in each case, with respect to any sale, exchange or other disposition
of any PCS License, whether binding or non-binding, or preparation of a
definitive agreement to sell, exchange or otherwise dispose of one or more of
its PCS Licenses (each, a "Negotiation"), Issuer shall deliver to Purchaser a
written notice of such Negotiation and shall use commercially reasonable efforts
to inform Purchaser of such Negotiation in a timely manner and to provide
Purchaser with all information as may be reasonably requested with respect to
such Negotiation including, without limitation, any documentation with respect
thereto. Upon agreement of the definitive terms of a proposed transaction,
Issuer shall provide to Purchaser a written notice of any bona fide proposed
sale, exchange or other disposition of one or more PCS Licenses which shall (w)
identify the PCS License or Licenses proposed to be sold, exchanged or otherwise
disposed of (the "Subject Licenses"), (x) describe the consideration and other
terms upon which the Subject Licenses are to be sold, exchanged or otherwise
disposed of, (y) identify the persons or entities to or with whom the Subject
Licenses are to be sold, exchanged or otherwise disposed of (the "Proposed
Buyer"), and (z) offer to sell, exchange or dispose of the Subject Licenses to
Purchaser on equivalent or better terms (the "First Refusal Offer").
(2) To accept a First Refusal Offer,
Purchaser must deliver a written notice to Issuer within 30 days of receipt of
the First Refusal Offer, setting forth Purchaser's irrevocable
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election to accept the First Refusal Offer to purchase all but not less than all
the Subject Licenses on the terms set forth therein (the "Acceptance"). The
Acceptance will be accompanied by reasonable written evidence demonstrating that
Purchaser has sufficient cash on hand or commitments (the terms of which are
consistent with customary commercial lending practices for fully-underwritten
financing commitments) available to consummate the transactions contemplated by
the Acceptance. If Purchaser does not deliver such evidence together with the
Acceptance in form and substance reasonably acceptable to Issuer, Purchaser
shall be deemed to have failed to deliver the Acceptance within the 30-day time
period contemplated by the first sentence of this Section 6.2(2).
(3) In the event that a proposed
transaction with a Proposed Buyer envisions receipt by the Issuer of
consideration other than cash for the Subject Licenses, Purchaser's Acceptance
of a First Refusal Offer may include consideration in the form of cash, one or
more promissory notes, the capital stock the Purchaser (or its successor or
parent entity), or any combination thereof (the "Purchaser's Consideration").
If, within three days of receipt of the Acceptance, Issuer disputes that
Purchaser's Consideration is equal to or greater in value than the offer of the
Proposed Buyer (the "Proposed Buyer's Consideration"), Issuer shall so inform
Purchaser in writing and such dispute shall be resolved as follows:
(a) If Issuer informs
Purchaser that it deems Purchaser's Acceptance to be inferior to the proposed
transaction agreed to with the Proposed Buyer, then the parties shall engage
Xxxxx & Co. (the "Bank") to determine whether Purchaser's Consideration is
inferior to Proposed Buyer's Consideration, and recommend what changes, if any,
would make Purchaser's Consideration equal in value to Proposed Buyer's
Consideration (the "Recommendation"). The determinations of the Bank shall be
binding, final and conclusive upon Issuer and Purchaser.
(b) In the event that
Purchaser's Consideration is appraised to be equal to or greater in value than
Proposed Buyer's Consideration, Issuer shall pay all costs of the Recommendation
hereunder. In the event that Purchaser's Consideration is appraised to be
inferior to Proposed Buyer's Consideration, Purchaser shall be pay all costs of
the Recommendation hereunder.
(c) In the event that the Bank
has determined that Purchaser's Consideration is inferior to Proposed Buyer's
Consideration, Purchaser shall have three (3) days to submit a revised
Acceptance containing the changes set forth in the Recommendation (the "Revised
Acceptance"). If Purchaser submits the Revised Acceptance within such three (3)
day period to Issuer, Issuer shall accept the Revised Acceptance and shall
proceed to consummate the transaction with Purchaser, as set forth in Section
6.2(b).
(4) If Issuer fails to notify Purchaser of
its challenge to Purchaser's Acceptance within three (3) days after its
receipt thereof, Issuer shall be deemed to have accepted the Acceptance and
shall proceed to consummate the transaction with Purchaser, as set forth in
Section 6.2(6).
(5) If Purchaser fails to deliver the
Acceptance within the 30-day time period referred to in Section 6.2(2), or the
Revised Acceptance within the 3-day period referred to in Section
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6.3(d), Issuer shall be free to proceed with the sale, exchange or other
disposition of the Subject Licenses to the Proposed Buyer.
(6) If Purchaser delivers to Issuer an
Acceptance within the 30-day time frame contemplated by Section 6.2(2) or the
Revised Acceptance within the 3-day time frame contemplated by Section
6.2(3)(d), as the case may be, and otherwise complies with the requirements of
Section 6.2(2), Issuer and Purchaser shall proceed to consummate the sale of the
Subject Licenses by Issuer to Purchaser contemplated by the Acceptance or the
Revised Acceptance, as the case may be, as soon as practicable and in any event
on or before the fifteenth (15th) day following the later of (i) expiration or
termination of the applicable waiting period under the HSR Act (as defined in
the Merger Agreement) and (ii) receipt of the written consent of the FCC to the
transfer of such Subject Licenses (the "Right of First Refusal FCC Consent").
Notwithstanding the foregoing, if the applicable waiting period under the HSR
Act has not expired or been terminated within 270 days, or the Right of First
Refusal FCC Consent has not been obtained within 360 days (the "Consent Period
End Date"), in each case, of the date of Acceptance or the Revised Acceptance,
as the case may be, Issuer shall be free to proceed with the sale, exchange or
other disposition of such Subject Licenses to any third party on any terms
acceptable to Issuer at any time without again complying with the terms of this
Section 6.2.
(7) Purchaser and Issuer shall cooperate
as necessary to prepare and file, within five (5) business days following
receipt by Issuer of the Acceptance or the Revised Acceptance, as the case may
be, from Purchaser, (i) the notification forms required pursuant the HSR Act,
and (ii) such applications to the FCC as required to obtain the Right of First
Refusal FCC Consent. Thereafter, Issuer and Purchaser shall cooperate as
reasonably necessary to obtain expiration or termination of the waiting period
required under the HSR Act, and to obtain the Right of First Refusal FCC
Consent.
(8) This Section 6.2 shall terminate and
be of no further force and effect on the second anniversary of the date on
which the Merger Agreement is terminated (the "Right of First Refusal End
Date").
(9) In the event that either (i) with
respect to any First Refusal Offer, the Right of First Refusal FCC Consent is
not obtained by the Consent Period End Date with respect to such First Refusal
Offer based on the FCC's rejection or denial of an application to assign the
Subject Licenses of such First Refusal Offer to the Purchaser for a reason that
would also apply to any application for Issuer to assign to Purchaser any of the
PCS Licenses that were not included in the Subject Licenses, or (ii) the Merger
Agreement is terminated as a result of failure to receive FCC Consent based on
the FCC's rejection or denial of an application to approve the Merger due to the
Purchaser's ineligibility to hold any of the PCS Licenses, the Purchaser shall
no longer have the Right of First Refusal or the rights provided by this Section
6.2; provided, that, notwithstanding anything to the contrary contained herein,
the Purchaser may assign the Right of First Refusal and its rights under this
Section 6.2 to another purchaser of its choosing that shall be eligible to hold
any of the PCS Licenses in accordance with the applicable FCC rules and
regulations.
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Section 6.3 Transactions, Agreements, etc. Except as
expressly provided in the Merger Agreement, Issuer shall not enter into any
transaction or contract, or take (or omit to take) any action which would, or is
reasonably likely to, (i) result in any of Issuer's representations or
warranties contained in this Agreement not being true and correct as of the
Subsequent Closing Date or (ii) prevent Issuer from performing, satisfying and
complying with all of its covenants and agreements contained in this Agreement.
Section 6.4 Fees and Expenses.
(a) Issuer shall incur no more than
$500,000 in legal and accounting fees and expenses in connection with the
negotiation, documentation and consummation of the transactions contemplated by
this Agreement and the Merger Agreement.
(b) Simultaneously with the
execution of this Agreement, Issuer shall place in escrow $150,000 (such amount,
together with all interest thereon, collectively the "Escrow Fund"). In the
event the Merger Agreement is terminated in accordance with its terms, the
Escrow Fund shall be released to Gabelli & Company, Inc. in full satisfaction of
all of Issuer's obligations for payment of investment banker, broker, finder or
similar fees. In the event that the transactions contemplated by the Merger
Agreement have been consummated, at the Closing (as defined in the Merger
Agreement), the Escrow Fund shall be released to Purchaser.
Section 6.5 Restrictions on Transfer.
(a) Purchaser understands and agrees
that the Stock it will be acquiring has not been registered under the
Securities Act of 1933 (the "Securities Act"), and that, accordingly, the Stock
will not be transferable except as permitted under various exemptions contained
in the Securities Act, or upon satisfaction of the registration and prospectus
delivery requirements of the Securities Act. Purchaser acknowledges that it must
bear the economic risk of its investment in the Stock for an indefinite period
of time because the Stock has not been registered under the Securities Act and
therefore cannot be sold unless they are subsequently registered or an exemption
from registration is available.
(b) Purchaser agrees with Issuer as
follows:
(i) The certificates
evidencing the shares of Stock it has agreed to purchase, and each certificate
issued in transfer thereof, will bear the following legend:
"THE SECURITIES EVIDENCED BY THIS
CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933 AND MAY NOT BE
SOLD OR TRANSFERRED UNLESS THERE IS AN
EFFECTIVE REGISTRATION STATEMENT COVERING
SUCH SECURITIES OR THE COMPANY
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RECEIVES AN OPINION OF COUNSEL (WHICH
COUNSEL AND OPINION ARE REASONABLY
SATISFACTORY TO THE COMPANY) STATING THAT
SUCH SALE OR TRANSFER IS EXEMPT FROM THE
REGISTRATION AND PROSPECTUS DELIVERY
REQUIREMENTS OF SUCH ACT."
(ii) The certificates representing the
Shares and each certificate issued in transfer thereof, will also bear
any legend required under any applicable state securities laws.
(iii) Absent an effective registration
statement under the Securities Act covering the disposition of the
Company's securities acquired by Purchaser, Purchaser will not sell, transfer,
assign, pledge, hypothecate or otherwise dispose of any or all of such
securities without first providing the Issuer with an opinion of counsel (which
counsel and opinion are reasonably satisfactory to the Issuer) that such
disposition is exempt from the registration and prospectus delivery requirements
of the Securities Act and has been registered or qualified under (or is exempt
from the registration and qualification requirement of) any applicable state
securities laws.
ARTICLE VII
CLOSING CONDITIONS
Section 7.1 Conditions to Purchaser's Obligations at the
Closing. The obligations of Purchaser under this Agreement are subject to the
fulfillment on or before the Closing of each of the following conditions:
(1) Performance. Issuer shall have executed and
delivered certificates representing the Shares, and shall have performed
and complied with all agreements, covenants and conditions contained in this
Agreement that are required to be performed or complied with by it on or before
the Closing.
(2) Proceedings and Documents. All corporate
and other proceedings in connection with the transactions contemplated at the
Closing and all documents incident thereto shall be reasonably satisfactory in
form and substance to Purchaser and its counsel, and Purchaser shall have
received all such counterpart original, certified and other copies of such
documents as Purchaser may reasonably request.
(3) No Adverse Action. There shall not have
been adopted or enacted any statute, rule or regulation prohibiting or
imposing any material condition on the transactions contemplated by this
Agreement, nor shall there have been instituted or pending any action or
proceeding by or before any court or governmental authority or other regulatory
or administrative agency or commission, domestic or foreign, by any government
or governmental authority, nor shall there be any determination by any
government, governmental authority, regulatory or administrative agency or
commission which, in either case, seeks to restrain, enjoin or impose any
material condition on the transactions contemplated by this Agreement or the
Merger Agreement, or would require Issuer or
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Purchaser, in the reasonable opinion of Purchaser, to take any action or do
anything in connection with the foregoing that may reasonably be expected to
have a material adverse effect to their respective businesses or materially
impair the ownership or operation of all or a material portion of the business,
assets or properties presently owned by Issuer or any of its Subsidiaries or to
be acquired by Purchaser pursuant to the Merger Agreement.
(4) Opinion of Company Counsel. Purchaser shall
have received from Xxxxxx & Xxxxxxx, counsel to Issuer, a legal opinion
addressed to Purchaser, dated as of the Closing Date, in the form and substance
reasonably satisfactory to Purchaser.
(5) Consents. All consents, approvals and
authorizations of, and filings, registrations and qualifications with, any
governmental authority or any other party on the part of Issuer required in
connection with the consummation of the transactions contemplated hereby shall
have been obtained or made and shall be in full force and effect.
(6) Secretary's Certificate. Purchaser shall
have received a Certificate of the Secretary of Issuer (i) certifying that no
document has been filed relating to or affecting the Charter of Issuer after the
date of the Certificate of the Secretary of State of the State of Delaware
delivered pursuant to clause (iii) of this subsection, (ii) certifying the names
and true signatures of each officer of Issuer who has been authorized to execute
and deliver this Agreement and any other document delivered by Issuer pursuant
to the Closing, (iii) attaching thereto a copy of the Charter certified as of a
recent date by the Secretary of State of Delaware, and a true and complete copy
of Bylaws of Issuer, as in full force and effect at the Closing Date and (iv)
attaching copies of resolutions duly adopted by the Board of Directors (and
stockholders, if applicable) authorizing the execution and delivery of this
Agreement and each of the other documents delivered by Issuer pursuant to the
Closing, the issuance, delivery and sale of the Shares and the performance of
the transactions contemplated by this Agreement, and certifying that such
resolutions were duly adopted, are in full force and effect and have not been
rescinded or amended as of the Closing Date.
(7) Voting Agreement. Purchaser shall have
received a Voting Agreement, in the form circulated among the parties with this
Agreement, executed by Issuer stockholder Aer Force Communications, Inc.
(8) Additional Documents. Purchaser shall have
received such certificates, documents and information as they may
reasonably request in order to establish satisfaction of the conditions set
forth in this Article VII.
Section 7.2 Conditions to Issuer's Obligations at the
Closing. The obligations of Issuer to Purchaser under this Agreement are subject
to the fulfillment on or before the Closing of each of the following conditions
by Purchaser:
(1) Payment of Purchase Price. Purchaser shall
have delivered the purchase price for its Shares in accordance with Section 1.1.
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(2) Consents. All consents, approvals and
authorizations of, and filings, registrations and qualifications with, any
governmental authority or any other party on the part of Purchaser required in
connection with the consummation of the transactions contemplated hereby shall
have been obtained or made and shall be in full force and effect.
(3) Secretary's Certificate. Issuer shall have
received a Certificate of the Secretary of Purchaser (i) certifying that no
document has been filed relating to or affecting the Charter of Purchaser after
the date of the Certificate of the Secretary of State of the State of Delaware
delivered pursuant to clause (iii) of this subsection, (ii) certifying the names
and true signatures of each officer of Purchaser who has been authorized to
execute and deliver this Agreement and any other document delivered by Purchaser
pursuant to the Closing, (iii) attaching thereto a copy of the Charter certified
as of a recent date by the Secretary of State of Delaware, and a true and
complete copy of Bylaws of Purchaser, as in full force and effect at the Closing
Date and (iv) attaching copies of resolutions duly adopted by the Board of
Directors (and stockholders, if applicable) authorizing the execution and
delivery of this Agreement and each of the other documents delivered by
Purchaser pursuant to the Closing, the issuance, delivery and sale of the Shares
and the performance of the transactions contemplated by this Agreement, and
certifying that such resolutions were duly adopted, are in full force and effect
and have not been rescinded or amended as of the Closing Date.
ARTICLE VIII
TERMINATION
8.1 Termination. This Agreement may be terminated:
(1) by mutual written agreement of the parties
hereto; or
(2) by either Issuer or Purchaser upon
consummation of the transactions contemplated by the Merger Agreement.
8.2 Effect of Termination. If this Agreement is terminated
pursuant to Section 8.1, this Agreement shall become void and of no effect
without liability of any party (or any stockholder, director, officer, employee,
agent, consultant or representative of such party) to the other parties hereto,
except that the agreements set forth in Article V (Registration Rights) shall
survive the termination of this Agreement and shall terminate in accordance with
the terms, if any, set for in that Article. No such termination shall relieve
any Party of any liability or damages resulting from any breach by such party of
this Agreement.
8.3 Fees and Expenses. All costs and expense incurred in
connection with this Agreement shall be paid by the party incurring such cost or
expense whether or not the transactions contemplated hereby occur.
ARTICLE IX
MISCELLANEOUS
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Section 9.1 Notices. All notices, requests and
other communications to any party hereunder shall be in writing (including
facsimile transmission) and shall be given,
if to Purchaser, to:
Omnipoint Corporation
Three Bethesda Metro Center
Xxxxx 000
Xxxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxx
Phone: (000) 000-0000
Fax: (000) 000-0000
with copies to:
Piper & Marbury L.L.P.
0000 Xxxxxxxxxx Xxxxxx, X.X.
Xxxxxxxxxx, X.X. 00000
Attention: Xxxxx X. Xxxxxx, Xx., Esq.
Phone: (000) 000-0000
Fax: (000) 000-0000
If to Issuer, to:
East/West Communications, Inc.
000 Xxxxxxxxxx Xxxxxx
Xxx, Xxx Xxxx 00000
Attention: Xxxxxxxx X. Xxxx
Phone: (000) 000-0000
Fax: (000) 000-0000
With a copy to:
Xxxxxx & Xxxxxxx
0000 Xxxxxxxxxxxx Xxxxxx, X.X.
Xxxxx 0000
Xxxxxxxxxx, X.X. 00000
Attention: Xxxxx Xxxxxx, Esq.
Xxxxxx X. Xxxxxx, Esq.
Phone: (000) 000-0000
Fax: (000) 000-0000
or such other address or facsimile number as such party may hereafter specify
for the purpose by notice to the other parties hereto. All such notices,
requests and other communications shall be
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deemed received on the date of receipt by the recipient thereof if received
prior to 5:00 p.m. on a Business Day, in the place of receipt. Otherwise, any
such notice, request or communication shall be deemed not to have been received
until the next succeeding Business Day in the place of receipt.
Section 9.2 Survival of Warranties. The warranties, representations,
certifications and covenants of Issuer and Purchaser contained in or made
pursuant to this Agreement shall survive each of (a) the execution and delivery
of this Agreement, and (b) the Closing, for a period of six months following the
Closing, and shall in no way be affected by any investigation of the subject
matter thereof made by or on behalf of Purchaser.
Section 9.3 Indemnification. Issuer agrees to indemnify the
Purchaser and its Affiliates, and the shareholders, members, managers, officers,
employees, agents and or legal representatives of any of them (each, a
"Purchaser Indemnified Party") and to hold each Purchaser Indemnified Party
harmless from and against any and all direct or indirect liabilities, claims,
losses, damages, costs and expenses of any kind (including, without limitation,
the reasonable fees and disbursements of such Purchaser Indemnified Party's
counsel in connection with any investigative, administrative or adjudicative
proceeding, whether or not either Purchaser shall be designated a party
thereto), together with any and all costs and expenses associated with the
investigation of the same and/or the enforcement of the provisions hereof
(collectively, "Losses"), which may be incurred by such Purchaser Indemnified
Party relating to, based upon, resulting from or arising out of (a) the breach
by Issuer of any representation, warranty, covenant or agreement of Issuer
contained herein, (b) this Agreement or the transactions contemplated hereby,
subject, in the case of the registration rights described in Article V, to the
provisions set forth in Section 5.8. Issuer shall reimburse each Purchaser
Indemnified Party promptly for all such Losses as they are incurred by such
Purchaser Indemnified Party.
Purchaser agrees to indemnify the Issuer and its
Affiliates, and the shareholders, members, managers, officers, employees, agents
and or legal representatives of any of them (each, an "Issuer Indemnified
Party") and to hold each Issuer Indemnified Party harmless from and against any
and all direct or indirect liabilities, claims, losses, damages, costs and
expenses of any kind (including, without limitation, the reasonable fees and
disbursements of such Issuer Indemnified Party's counsel in connection with any
investigative, administrative or adjudicative proceeding, whether or not either
Purchaser shall be designated a party thereto), together with any and all costs
and expenses associated with the investigation of the same and/or the
enforcement of the provisions hereof (collectively, "Losses"), which may be
incurred by such Issuer Indemnified Party relating to, based upon, resulting
from or arising out of (a) the breach by Purchaser of any representation,
warranty, covenant or agreement of Purchaser contained herein, (b) this
Agreement or the transactions contemplated hereby, subject, in the case of the
registration rights described in Article V, to the provisions set forth in
Section 5.8. Purchaser shall reimburse each Issuer Indemnified Party promptly
for all such Losses as they are incurred by such Issuer Indemnified Party.
Notwithstanding any other provisions hereof, no
indemnified party shall be entitled to make a claim against an indemnitor (an
"Indemnitor") in respect of any breach of this Agreement except to the extent
that the aggregate amount of such damages exceeds the amount of FIFTY
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THOUSAND DOLLARS ($50,000) (the "Threshold Amount"); provided, however, that
once such aggregate has been exceeded, such Indemnitor shall only be liable for
the amount that such damages exceed the Threshold Amount. Notwithstanding any
other provision of the Agreement, neither the indemnity obligation of Issuer nor
the indemnity obligation of Purchaser will exceed the amount payable by
Purchaser for the Stock pursuant to Section 1.1.
Section 9.4 Amendments; No Waivers.
(1) Subject to applicable law, any provision of
this Agreement may be amended or waived, but only if, such amendment or
waiver is in writing and is signed, in the case of an amendment, by each party
to this Agreement or, in the case of a waiver, by each party against whom the
waiver is to be effective.
(2) No failure or delay by any party in
exercising any right, power or privilege hereunder shall operate as a waiver
thereof nor shall any single or partial exercise thereof preclude any other or
further exercise thereof or the exercise of any other right, power or privilege.
The rights and remedies herein provided shall be cumulative and not exclusive of
any rights or remedies provided by law.
Section 9.5 Successors and Assigns. The provisions of
this Agreement shall be binding upon and inure to the benefit of the parties
hereto and their respective successors and assigns; provided that no party may
assign, delegate or otherwise transfer any of its rights or obligations under
this Agreement without the consent of each other party hereto.
Section 9.6 Governing Law. This Agreement shall be
governed by and construed in accordance with the laws of the State of Delaware,
without regard to the conflicts of law rules of such State.
Section 9.7 Jurisdiction. Any suit, action or proceeding
seeking to enforce any provision of, or based on any matter arising out of or in
connection with, this Agreement or the transactions contemplated hereby shall be
brought in any federal court located in the State of Delaware or any Delaware
state court, and each of the parties hereby consents to the exclusive
jurisdiction of such courts (and of the appropriate appellate courts therefrom)
in any such suit, action or proceeding and irrevocably waives, to the fullest
extent permitted by law, any objection that it may now or hereafter have to the
laying of the venue of any such suit, action or proceeding in any such court or
that any such suit, action or proceeding brought in any such court has been
brought in an inconvenient forum. Process in any such suit, action or proceeding
may be served on any party anywhere in the world, whether within or without the
jurisdiction of any such court.
Section 9.8 WAIVER OF JURY TRIAL. EACH OF THE PARTIES
HERETO HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL
PROCEEDING ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY.
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Section 9.9 Counterparts; Effectiveness. This Agreement may be
signed in any number of counterparts, each of which shall be an original, with
the same effect as if the signatures thereto and hereto were upon the same
instrument. This Agreement shall become effective when each party hereto shall
have received counterparts hereof signed by all of the other parties hereto.
Section 9.10 Entire Agreement; No Third Party Beneficiaries. This
Agreement constitutes the entire agreement between the parties with respect to
the subject matter of this Agreement and supersedes all prior agreements and
understandings, both oral and written, between the parties with respect to the
subject matter of this Agreement. Except as specifically set forth herein, this
Agreement is not intended to confer upon any Person other than the parties
hereto any rights or remedies.
Section 9.11 Captions. The captions herein are included for
convenience of reference only and shall be ignored in the construction or
interpretation hereof.
Section 9.12 Definitions, Gender, Number, etc. Unless otherwise
defined herein, capitalized terms used herein shall have the meanings specified
in the Merger Agreement for all purposes of this Agreement, applicable to both
the singular and plural forms of any of the terms defined herein. When a
reference is made in this Agreement to a Section or Article such reference shall
be to a Section or Article of this Agreement unless otherwise indicated.
Whenever the words "include," "includes" or "including" are used in this
Agreement, they shall be deemed to be followed by the words "without
limitation." The use of any gender herein shall be deemed to include the neuter,
masculine and feminine genders wherever necessary or appropriate.
Section 9.13 Severability. If any term, provision, covenant or
restriction of this Agreement is held by a court of competent jurisdiction or
other authority to be invalid, void or unenforceable, the remainder of the
terms, provisions, covenants and restrictions of this Agreement shall remain in
full force and effect and shall in no way be affected, impaired or invalidated
so long as the economic or legal substance of the transactions contemplated
hereby is not affected in any manner materially adverse to any party. Upon such
a determination, the parties shall negotiate in good faith to modify this
Agreement so as to effect the original intent of the parties as closely as
possible in an acceptable manner so that the transactions contemplated hereby be
consummated as originally contemplated to the fullest extent possible.
Section 9.14 Specific Performance. The parties hereto agree that
irreparable damage would occur if any provision of this Agreement were not
performed in accordance with the terms hereof and that the parties shall be
entitled to an injunction or injunctions to prevent breaches of this Agreement
or to enforce specifically the performance of the terms and provisions hereof in
any federal court located in the State of Delaware or any Delaware state court,
in addition to any other remedy to which they are entitled at law or in equity.
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[Signatures on next page.]
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed by their respective authorized officers as of
the day and year first above written.
OMNIPOINT CORPORATION
By: /s/ XXXXXXX X. XXXXX
----------------
Xxxxxxx X. Xxxxx
President
EAST/WEST COMMUNICATIONS, INC.
By: /s/ XXXXXXXX X. XXXX
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Xxxxxxxx X. Xxxx
Chairman
