EXHIBIT 2.2
AGREEMENT AND PLAN OF MERGER
By and Among
AMERICAN TOWER CORPORATION,
AMERICAN TOWERS, INC.
and
TELECOM TOWERS, L.L.C.
Dated as of
November 16, 1998
TABLE OF CONTENTS
Page
ARTICLE 1 DEFINED TERMS................................................................ 1
ARTICLE 2 THE MERGER................................................................... 2
2.1 The Merger............................................................... 2
2.2 Closing.................................................................. 2
2.3 Effective Time........................................................... 2
2.4 Effect of the Merger..................................................... 2
2.5 Certificate of Incorporation............................................. 2
2.6 Bylaws................................................................... 2
2.7 Directors and Officers................................................... 2
ARTICLE 3 CONVERSION OF INTERESTS...................................................... 3
3.1 Conversion of TCT Units.................................................. 3
3.2 Delivery of Merger Consideration......................................... 4
3.3 Option Securities and Convertible Securities; No Payment Rights.......... 4
3.4 Determination of Merger Consideration.................................... 4
ARTICLE 4 REPRESENTATIONS AND WARRANTIES OF TCT........................................ 5
4.1 Organization and Business; Power and Authority; Effect of Transaction.... 5
4.2 Financial and Other Information.......................................... 7
4.3 Material Statements and Omissions; Absence of Events..................... 7
4.4 Title to Properties; Leases.............................................. 7
4.5 Compliance with Private Authorizations................................... 8
4.6 Compliance with Governmental Authorizations and Applicable Law........... 9
4.7 Intangible Assets........................................................ 10
4.8 Related Transactions..................................................... 10
4.9 Insurance................................................................ 10
4.10 Tax Matters.............................................................. 10
4.11 Employee Retirement Income Security Act of 1974.......................... 11
4.12 Solvency................................................................. 13
4.13 Bank Accounts, Etc....................................................... 13
4.14 Employment and Consulting Arrangements................................... 13
4.15 Material Agreements...................................................... 13
4.16 Ordinary Course of Business.............................................. 14
4.17 Material and Adverse Restrictions........................................ 15
4.18 Broker or Finder......................................................... 15
4.19 Environmental Matters.................................................... 15
4.20 Capital Stock............................................................ 16
4.21 Year 2000 Compliant...................................................... 16
4.22 Materiality.............................................................. 16
ARTICLE 5 REPRESENTATIONS AND WARRANTIES OF ATC AND ATI................................ 17
5.1 Organization and Business; Power and Authority; Effect of Transaction.... 17
5.2 ATC SEC Reports.......................................................... 18
5.3 Material Statements and Omissions; Absence of Events..................... 18
5.4 Broker or Finder......................................................... 19
Page
5.5 Capital Stock............................................................ 19
5.6 Compliance with Governmental Authorizations and Applicable Law........... 19
5.7 Materiality.............................................................. 20
ARTICLE 6 COVENANTS.................................................................... 20
6.1 Access to Information; Confidentiality................................... 20
6.2 Agreement to Cooperate; Certain Other Covenants.......................... 21
6.3 Public Announcements..................................................... 22
6.4 Notification of Certain Matters.......................................... 22
6.5 No Solicitation.......................................................... 22
6.6 Conduct of Business by TCT Pending the Merger............................ 23
6.7 Preliminary Title Reports................................................ 25
6.8 Environmental Site Assessments........................................... 25
6.9 Solicitation of Employees................................................ 25
6.10 Certificate of Non-Foreign Status........................................ 25
6.11 Tax Returns and Other Reports............................................ 26
6.12 Section 754 Elections.................................................... 26
ARTICLE 7 CLOSING CONDITIONS........................................................... 26
7.1 Conditions to Obligations of Each Party.................................. 26
7.2 Conditions to Obligations of ATC and ATI................................. 26
7.3 Conditions to Obligations of TCT......................................... 29
ARTICLE 8 TERMINATION, AMENDMENT AND WAIVER............................................ 31
8.1 Termination.............................................................. 31
8.2 Effect of Termination.................................................... 31
ARTICLE 9 INDEMNIFICATION.............................................................. 32
9.1 Survival................................................................. 32
9.2 Indemnification.......................................................... 32
9.3 Limitation of Liability.................................................. 33
9.4 Notice of Claims......................................................... 33
9.5 Defense of Third Party Claims............................................ 33
9.6 Exclusive Remedy......................................................... 34
9.7 Indemnification of Directors and Officers................................ 34
ARTICLE 10 GENERAL PROVISIONS.......................................................... 35
10.1 Waivers; Amendments...................................................... 35
10.2 Fees, Expenses and Other Payments........................................ 36
10.3 Notices.................................................................. 36
10.4 Specific Performance; Other Rights and Remedies.......................... 37
10.5 Severability............................................................. 37
10.6 Counterparts............................................................. 38
10.7 Section Headings......................................................... 38
10.8 Governing Law; Venue..................................................... 38
10.9 Further Acts............................................................. 38
10.10 Entire Agreement......................................................... 38
10.11 Assignment............................................................... 39
10.12 Parties in Interest...................................................... 39
10.13 Mutual Drafting.......................................................... 39
10.14 TCT Disclosure Schedule.................................................. 39
10.15 ATC's Due Diligence...................................................... 40
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APPENDIX A: Definitions
EXHIBITS:
EXHIBIT A: Opinion of TCT Counsel (Section 7.2(b)).
EXHIBIT B: Registration Rights Agreement (Section 7.2(m)).
EXHIBIT C: TCT Investment Letter (Section 7.2(n)).
EXHIBIT D: ATC Noncompetition Agreements (Section 7.2(p)).
EXHIBIT E: Indemnity Escrow Agreement (Section 7.2(s)).
EXHIBIT F: Opinion of Xxxxxxxx & Worcester LLP (Section 7.3(b)).
EXHIBIT G: ATC Voting Agreement (Section 7.3(h)).
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AGREEMENT AND PLAN OF MERGER
----------------------------
Agreement and Plan of Merger, dated as of November 16, 1998, by and among
American Tower Corporation, a Delaware corporation ("ATC"), American Towers,
Inc., a Delaware corporation ("ATI"), and TeleCom Towers, L.L.C., a Delaware
limited liability company ("TCT").
W I T N E S S E T H:
WHEREAS, the Boards of Directors of ATC and ATI and the Management
Committee of TCT have determined that the merger (the "Merger") of TCT into ATI
on the terms and conditions set forth in this Agreement and Plan of Merger (this
"Agreement") is consistent with and in furtherance of the long-term business
strategy of each, and is fair to, and in the best interests of, the stockholder
of ATI and the members of TCT (the "TCT Members"); and
WHEREAS, this Agreement provides that TCT shall be merged with and into
ATI, and ATI shall be the surviving corporation; and
WHEREAS, the Boards of Directors of ATI and the Management Committee of TCT
have approved and adopted this Agreement and have directed that this Agreement
be submitted to the stockholder of ATI and the members of TCT, respectively, for
their adoption and approval; and
WHEREAS, the Board of Directors of ATC has approved and adopted this
Agreement and approved the Merger on behalf of ATI as the sole stockholder of
ATI; and
WHEREAS, as a condition of the willingness of ATC and ATI to enter into
this Agreement, and as an inducement thereto, TCT Members with the interests in
TCT required for TCT's approval of the Merger and this Agreement are delivering
their written consents approving and adopting the Merger and this Agreement;
NOW, THEREFORE, in consideration of the premises and the representations,
warranties, covenants and agreements herein contained and other valuable
consideration, the receipt and adequacy whereof are hereby acknowledged, the
parties hereto hereby, intending to be legally bound, represent, warrant,
covenant and agree as follows:
ARTICLE 1
DEFINED TERMS
As used herein, unless the context otherwise requires, the terms defined in
Appendix A shall have the respective meanings set forth therein. The term "TCT"
as used in Appendix A shall include all Subsidiaries of TCT, except as the
context otherwise clearly requires. Terms defined in the singular shall have a
comparable meaning when used in the plural, and vice versa, and the reference to
any gender shall be deemed to include all genders. Unless otherwise defined or
the context otherwise clearly requires, terms for which meanings are provided in
this Agreement shall have such meanings when used in the TCT Disclosure
Schedule, and each Collateral Document executed or required to be executed
pursuant hereto or thereto or otherwise delivered, from time to time, pursuant
hereto or thereto. References to "hereof," "herein" or similar terms are
intended to refer to the Agreement as a whole and not a particular section, and
references to "this Section" or "this Article" are intended to refer to the
entire section or article and not a particular subsection thereof. The term
"either party" shall, unless the context otherwise requires, refer to ATC and
ATI, on the one hand, and TCT, on the other hand.
ARTICLE 2
THE MERGER
2.1 The Merger. Upon the terms and subject to the conditions set forth in
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this Agreement, and in accordance with the Delaware General Corporation Law (the
"DCL"), and the Delaware Limited Liability Company Act (the "DLLCA"), at the
Effective Time, TCT shall be merged with and into ATI. As a result of the
Merger, the separate limited liability company existence of TCT shall cease and
ATI shall continue as the surviving Entity in the Merger (sometimes referred to,
as such, as the "Surviving Corporation").
2.2 Closing. Unless this Agreement shall have been terminated pursuant to
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Section 9.1 and subject to the satisfaction or, to the extent permitted by
Applicable Law, waiver of the conditions set forth in Article 8, the closing of
the Merger (the "Closing") will take place, at 10:00 a.m., on the Closing Date,
at the offices of Xxxxxxxx & Worcester LLP, Xxx Xxxx Xxxxxx Xxxxxx, Xxxxxx,
Xxxxxxxxxxxxx 00000, on the later of (a) January 4, 1999 and (b) a date set by
mutual agreement within ten (10) business days after the satisfaction of the
conditions set forth in Sections 7.1(b), 7.1(c) and 7.2(d) (unless any such
condition is waived by the party entitled to make such waiver) shall have been
satisfied or waived, unless another date, time or place is agreed to in writing
by the parties. The date on which the Closing occurs is herein referred to as
the "Closing Date."
2.3 Effective Time. Subject to the provisions of this Agreement, as
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promptly as practicable after the Closing, the parties hereto shall cause the
Merger to be consummated by filing a Certificate of Merger and any related
filings required under the DCL or the DLLCA with the Secretary of State of the
State of Delaware. The Merger shall become effective at such time as such
documents are duly filed as aforesaid, or at such later time as is specified in
such documents (the "Effective Time").
2.4 Effect of the Merger. The Merger shall have the effects provided for
--------------------
under the DCL and the DLLCA.
2.5 Certificate of Incorporation. The Certificate of Incorporation of
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ATI, as in effect immediately prior to the Effective Time, shall be the
Certificate of Incorporation of the Surviving Corporation until thereafter
changed or amended as provided therein or by Applicable Law.
2.6 Bylaws. The bylaws of ATI in effect at the Effective Time shall be
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the bylaws of the Surviving Corporation until amended in accordance with
Applicable Law and the Organic Documents of ATI.
2.7 Directors and Officers. From and after the Effective Time, until
----------------------
successors are duly elected or appointed and qualified, or upon their earlier
resignation or removal, in accordance with Applicable Law and the Organic
Documents of ATI, (a) the directors of ATI at the Effective Time shall be the
directors of the Surviving Corporation, and (b) the officers of ATI at the
Effective Time shall be the officers of the Surviving Corporation.
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ARTICLE 3
CONVERSION OF INTERESTS
3.1 Conversion of TCT Units At the Effective Time, by virtue of the
-----------------------
Merger and without any action on the part of ATC, ATI or TCT or their respective
stockholders or members, as the case may be:
(a) Each share of Common Stock, par value $.01 per share, of ATI
issued and outstanding immediately prior to the Effective Time shall remain
outstanding; and
(b) Each Class A Unit of TCT and each Class B Unit of TCT
(collectively, the "TCT Units") issued and outstanding immediately prior to
the Effective Time shall, by virtue of the Merger and without any action on
the part of the holder thereof, be converted into the right to receive its
pro-rata share of the Merger Consideration.
The term "Merger Price" shall mean an amount equal to the amount determined by
(i) subtracting from $155.0 million, the amount, if any, by which the
Indebtedness for Money Borrowed of TCT and its Subsidiaries at the Effective
Time (computed on a consolidated basis in accordance with GAAP) exceeds (ii) the
sum of (x) $30.0 million and (y) the aggregate amount (including acquisition
costs) TCT has paid subsequent to the execution and delivery of this Agreement
and prior to the Effective Time for any and all acquisitions including ComSites
USA and the remaining general partnership interests in Mid Pacific (for an
amount not in excess of $5.5 million) or capital expenditures, and (iii) adding
the amount by which the Current Balance as of the Effective Time exceeds zero or
subtracting the amount by which the Current Balance as of the Effective Time is
less than zero. The term "Merger Consideration" shall mean and shall be paid in
(i) shares (the "ATC Stock Consideration") of Class A Common Stock, par value
$.01 per share, of ATC (the "ATC Common Stock") in an amount equal to sixty
percent (60%) of the Merger Price (before adjustment pursuant to clause (iii) of
the immediately preceding sentence) and (ii) cash for the balance of the Merger
Price (the "Cash Consideration"). (For example, assuming Indebtedness for
Borrowed Money equal to $30.0 million and no capital expenditures, if the
Current Balance equals $10.0 million, the Merger Consideration shall be equal to
$165.0 million, payable $93.0 million in ATC Common Stock and $72.0 million in
Cash Consideration. With the same assumptions, if the Current Balance equals
($10.0 million), the Merger Consideration shall be equal to $145.0 million,
payable $93.0 million in ATC Common Stock and $52.0 million in Cash
Consideration.) The Cash Consideration and the ATC Stock Consideration shall be
paid or issued, as applicable, to each TCT Member in the same proportion that
the number of TCT Units held by such TCT Member bears to the aggregate number of
TCT Units held by all TCT Members, in all cases without distinction between
classes of TCT Units. For purposes of determining the number of shares of ATC
Common Stock issuable as the ATC Stock Consideration, the amount of the Merger
Price payable in ATC Common Stock will be divided by the Current Market Price,
subject to adjustment as provided in the following paragraph.
In the event the Closing Date Share Price is less than the Current Market
Price minus $3.50 per share (the "Floor Share Price"), the ATC Stock
Consideration shall be increased by a number of shares of ATC Common Stock
determined as follows:
(i) Divide the ATC Stock Consideration by the Floor Share Price;
(ii) Divide the ATC Stock Consideration by the Closing Date Share
Price; and
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(iii) Subtract the amount determined under paragraph (i) from the
amount determined under paragraph (ii).
In the event the Closing Date Share Price exceeds the Current Market Price plus
$3.50 per share (the "Ceiling Share Price") the ATC Stock Consideration shall be
decreased by a number of shares of ATC Common Stock determined as follows:
(i) Divide the ATC Stock Consideration by the Ceiling Share Price;
(ii) Divide the ATC Stock Consideration by the Closing Date Share
Price; and
(iii) Subtract the amount determined under paragraph (ii) from the
amount determined under paragraph (i).
At the Effective Time, all TCT Units shall no longer be outstanding and
shall automatically be canceled and retired and shall cease to exist, and each
holder of TCT Units shall have, instead, the right to receive, in accordance
with the provisions of Section 3.2, the Merger Consideration multiplied by the
number of TCT Units owned by such TCT Member. In lieu of issuing fractional
shares, ATC shall convert the holder's right to receive ATC Common Stock
pursuant to the provisions of this Section into a right to receive (i) the
highest whole number of shares of ATC Common Stock constituting the Merger
Consideration plus (ii) cash equal to the fraction of a share of ATC Common
Stock to which the holder would otherwise be entitled multiplied by the Fair
Market Value of one share of ATC Common Stock as of the Effective Time. As of
the Effective Time, the holders of TCT Units outstanding immediately prior to
the Effective Time shall cease to have any rights with respect to such TCT
Units, except as otherwise provided herein or by Applicable Law.
3.2 Delivery of Merger Consideration. At and after the Effective Time,
--------------------------------
each TCT Member, upon the execution and delivery to ATC of a certificate, in
substantially the form heretofore agreed upon by ATC and TCT, with respect to
such TCT Units and its ownership thereof, shall be entitled to receive (a) the
Cash Consideration and (b) a certificate for ATC Common Stock representing the
number of whole shares constituting the ATC Stock Consideration and cash in an
amount sufficient to make payment for any fractional share constituting a part
of the ATC Stock Consideration, in each case representing the Merger
Consideration with respect to the TCT Units formerly held by such TCT Member in
accordance with the provisions of this Article, subject, however, to the
provisions of the Indemnity Escrow Agreement. ATC shall be entitled to deduct
and withhold from Merger Consideration otherwise payable pursuant to this
Agreement such amounts of cash or ATC Common Stock as ATC shall deem necessary
to satisfy any requirement for deduction or withholding with respect to the
making of such payment under the Code, or any provision of state, local or
foreign tax law. To the extent that amounts are so withheld by ATC, such
withheld amounts shall be treated for all purposes of this Agreement as having
been paid to the TCT Member in respect of which such deduction and withholding
was made by ATC.
3.3 Option Securities and Convertible Securities; No Payment Rights. At
---------------------------------------------------------------
the Effective Time, each outstanding Option Security and each Convertible
Security of TCT, if any, whether or not then exercisable for or convertible into
TCT Units or other TCT securities, outstanding immediately prior to the
Effective Time, shall be canceled and retired and shall cease to exist, and the
holder thereof shall not be entitled to receive any consideration therefor.
3.4 Determination of Merger Consideration. Not later than ten (10) days
-------------------------------------
prior to the Closing Date, TCT shall submit to ATC its preliminary determination
of the amount of the Merger Consideration
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determined in accordance with the provisions of Section 3.1. Within seven (7)
days thereafter, ATC shall submit to TCT its objections, if any, to such
preliminary determination, specifying in reasonable detail the nature of such
objections. The parties shall use their reasonable business efforts to agree
upon the amount of the Merger Consideration, but in the event they are unable to
do so, then (a) the Merger shall be consummated (assuming that all other
conditions thereto shall have been satisfied), (b) the Merger Consideration at
the Effective Time shall be comprised of the Cash Consideration and the ATC
Stock Consideration as provided in this Section, and (c) a post-Effective Time
adjusting cash payment (if any) shall be made by ATC to the TCT Members as
provided in this Section. In the event the parties are unable to agree as
aforesaid, then (a) the ATC Stock Consideration at the Effective Time shall be
the ATC Stock Consideration determined by TCT, and (b) the Cash Consideration at
the Effective Time shall be the Cash Consideration determined by TCT reduced by
an amount equal to the sum (the "Adjustment Holdback") of (i) the difference
between the Cash Consideration determined by TCT and that determined by ATC, and
(ii) the difference (valued at the Current Market Price) between the ATC Stock
Consideration determined by TCT and that determined by ATC, in each case using
Merger Considerations determined pursuant to the provisions of Section 3.1. To
the extent the parties are unable to agree upon the amount of the Current
Balance, the Adjustment Holdback shall consist of cash, and to the extent the
parties are unable to agree upon the aggregate amount of acquisition expense and
capital expenditures of TCT referred to in clause (ii) of the second sentence of
Section 3.1, the Adjustment Holdback shall consist of ATC Common Stock and cash
in the proportions specified in Section 3.1. Under such circumstances, TCT and
ATC shall, within ten (10) days following the Effective Time, jointly designate
a nationally known independent public accounting firm to be retained to
determine the amount of the Current Balance and aggregate amount of acquisition
expenses and capital expenditures of TCT referred to in clause (ii) of the
second sentence of Section 3.1. The fees and other expenses of retaining such
independent public accounting firm shall be borne by ATC and TCT (prior to
Closing) and the TCT Members (out of the Adjustment Holdback after the Closing)
in inverse proportion to its determination of the contested amount of the Merger
Consideration. Such firm shall report its conclusions pursuant to this Section,
and such report shall be conclusive on all parties to this Agreement and not
subject to dispute or review. Upon determination by such independent accounting
firm (or sooner agreement of the Merger Consideration by the parties), ATC shall
deliver to the TCT Members, as their interests may appear, the amount of the
Adjustment Holdback, if any, to which they are entitled, together with interest
on the cash portion thereof at the rate of ten percent (10%) per annum.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF TCT
--------------------------------------
All representations and warranties, unless the context indicates otherwise,
exclude RCC which will be distributed by TCT to some or all TCT Members prior to
the Merger. TCT hereby represents and warrants to ATC and ATI as follows:
4.1 Organization and Business; Power and Authority; Effect of Transaction.
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(a) TCT is a limited liability company duly organized, validly existing and
in good standing under the laws of its jurisdiction of organization, has all
requisite power and authority (limited liability company and other) to own or
hold under lease its properties and to conduct its business as now conducted and
is duly qualified and in good standing as a foreign limited liability company in
each other jurisdiction (as shown on Section 4.1(a) of the TCT Disclosure
Schedule) in which the character of the property owned or leased by it or the
nature of its business or operations requires such qualification, except for
such qualifications the failure of which to obtain, individually or in the
aggregate, would not have a material adverse effect on TCT.
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(b) TCT has all requisite power and authority (limited liability company
and other) necessary to enable it to execute and deliver, and to perform its
obligations under, this Agreement and each Collateral Document executed or
required to be executed by it pursuant hereto or thereto and to consummate the
Transactions; and the execution, delivery and performance by TCT of this
Agreement and each Collateral Document executed or required to be executed by it
pursuant hereto or thereto have been duly authorized by all requisite limited
liability company or other action on the part of TCT, including without
limitation the requisite approval of the TCT Members, if any. The affirmative
vote of the holders of TCT Units representing a majority of the outstanding
voting power of all TCT Units is sufficient to approve and adopt this Agreement
and the transactions contemplated by this Agreement. This Agreement has been
duly executed and delivered by TCT and constitutes, and each Collateral Document
executed or required to be executed by it pursuant hereto or thereto or to
consummate the Transactions when executed and delivered by TCT will constitute,
legal, valid and binding obligations of TCT, enforceable in accordance with
their respective terms, except as such enforceability may be subject to
bankruptcy, moratorium, insolvency, reorganization, arrangement, voidable
preference, fraudulent conveyance and other similar Laws relating to or
affecting the rights of creditors and except as the same may be subject to the
effect of general principles of equity.
(c) Except as set forth in Section 4.1(c) of the TCT Disclosure Schedule,
neither the execution and delivery by TCT of this Agreement or any Collateral
Document executed or required to be executed by it pursuant hereto or thereto,
nor the consummation of the Transactions, nor compliance with the terms,
conditions and provisions hereof or thereof by TCT:
(i) will conflict with, or result in a breach or violation of, or
constitute a default under, any Organic Document of TCT or any Applicable
Law, or will conflict with, or result in a breach or violation of, or
constitute a default under, or permit the acceleration of any obligation or
liability in, or but for any requirement of giving of notice or passage of
time or both would constitute such a conflict with, breach or violation of,
or default under, or permit any such acceleration in, any Material
Agreement of TCT; or
(ii) will require TCT to make or obtain any Governmental
Authorization, Governmental Filing or Private Authorization, except (A)
filings under the Xxxx-Xxxxx-Xxxxxx Act, (B) for FCC approvals, and (C) the
filing of the Certificate of Merger with the Delaware Secretary of State.
(d) Except as set forth in Section 4.1(d) of the TCT Disclosure Schedule,
TCT does not have any Subsidiaries, and each such disclosed Subsidiary is (i)
wholly-owned unless noted otherwise in Section 4.1(d) of the TCT Disclosure
Schedule, (ii) a corporation or other Entity which is duly organized, validly
existing and in good standing under the laws of the respective state of
incorporation or formation set forth opposite its name on Section 4.1(d) of the
TCT Disclosure Schedule, and (iii) duly qualified and in good standing as a
foreign corporation or Entity in each other jurisdiction (as shown on Section
4.1(d) of the TCT Disclosure Schedule) in which the character of the property
owned or leased by it or the nature of its business or operations requires such
qualification, with full power and authority (corporate, partnership, limited
liability company and other) to carry on the business in which it is engaged,
except for such qualifications the failure of which to obtain, individually or
in the aggregate, would not have a material adverse effect on TCT. TCT owns,
directly or indirectly, all of the outstanding capital stock or equity interests
(as shown in Section 4.1(d) of the TCT Disclosure Schedule) of each Subsidiary,
free and clear of all Liens (except for restrictions on transfer of partnership
interests set forth in partnership agreements, as listed on Section 4.1(d)
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of the TCT Disclosure Schedule, and as described in the notes to the TCT
Financial Statements), and all such stock or other equity interests has been
duly authorized and validly issued and is fully paid and nonassessable. Except
as set forth in Section 4.1(d) of the TCT Disclosure Schedule, there are no
outstanding Option Securities or Convertible Securities, or agreements or
understandings of any nature whatsoever, relating to the authorized and unissued
or outstanding capital stock or equity interests of any Subsidiary of TCT.
Except as the context otherwise requires, the representations and warranties of
TCT set forth in this Article shall apply to each of such Subsidiaries with the
same force and effect as though each of them were named in each Section of this
Article.
4.2 Financial and Other Information. TCT has heretofore made available to
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ATC copies of the financial statements of TCT listed in Section 4.2 of the TCT
Disclosure Schedule (the "TCT Financial Statements"). The TCT Financial
Statements, including in each case the notes thereto, have been prepared in
accordance with GAAP applied on a consistent basis throughout the periods
covered thereby, except as otherwise noted therein, are true, accurate and
complete in all material respects, and fairly present the consolidated financial
condition and the consolidated results of operations and cash flow of TCT, on
the bases therein stated, as of the respective dates thereof, and for the
respective periods covered thereby subject, in the case of unaudited financial
statements, to normal nonmaterial year-end audit adjustments and accruals. The
Annual Tower Revenue Run Rate of TCT for the month of October 1998 was not less
than $1,050,000.
4.3 Material Statements and Omissions; Absence of Events. Neither any
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representation or warranty made by TCT contained in this Agreement or any
certificate, document or other instrument furnished or to be furnished by TCT
pursuant to the provisions hereof nor the TCT Disclosure Schedule contains or
will contain any untrue statement of a material fact or omits or will omit to
state any material fact required to make any statement contained herein or
therein, in light of the circumstances under which they were made, not
misleading. Since the date of the most recent financial statements constituting
a part of the TCT Financial Statements, except to the extent specifically
described in Section 4.3 of the TCT Disclosure Schedule, there has been no
change with respect to TCT which has had, or (so far as TCT can now reasonably
foresee) is likely to have, a material adverse effect on TCT. There is no Event
known to TCT which has had, or (so far as TCT can now reasonably foresee) is
likely to have, a material adverse effect on TCT, except to the extent
specifically described in Section 4.3 of the TCT Disclosure Schedule.
4.4 Title to Properties; Leases.
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(a) Section 4.4(a) of the TCT Disclosure Schedule contains a true, accurate
and complete description of real property owned by TCT. TCT has good
indefeasible, marketable and insurable title to all such real property (other
than easement and leasehold real property) and good indefeasible and marketable
title to all of its other property and assets, tangible and intangible
(collectively, the "TCT Assets"); all of the TCT Assets are so owned, in each
case, free and clear of all Liens, except (i) Permitted Liens, and (ii) Liens
set forth on Section 4.4(a) of the TCT Disclosure Schedule (which Liens shall be
released prior to the Closing). Except for financing statements evidencing
Liens referred to in the immediately preceding sentence (a true, accurate and
complete list and description of which is set forth in Section 4.4(a) of the TCT
Disclosure Schedule), no financing statements under the Uniform Commercial Code
and no other filing which names TCT as debtor or which covers or purports to
cover any of the TCT Assets is on file in any state or other jurisdiction, and
TCT has not signed or agreed to sign any such financing statement or filing or
any agreement authorizing any secured party thereunder to file any such
financing statement or filing. Except as disclosed in Section 4.4(a) of the TCT
Disclosure Schedule, all improvements on the real property owned or leased by
TCT which improvements are owned by TCT are in compliance with applicable
zoning, wetlands and land use laws, ordinances and regulations and applicable
title covenants, conditions, restrictions and reservations in all respects
necessary to conduct the operations
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as presently conducted, except for any instances of non-compliance which,
individually or in the aggregate, do not and will not have a material adverse
effect on the TCT Assets taken as a whole. Except as disclosed in Section 4.4(a)
of the TCT Disclosure Statement, all such improvements comply in all material
aspects with all Applicable Laws, Governmental Authorizations and Private
Authorizations. Except as disclosed in Section 4.4(a) of the TCT Disclosure
Statement, and except as would not, individually or in the aggregate, have a
material adverse effect on TCT, all of the transmitting towers, ground radials,
guy anchors, transmitting buildings and related improvements, if any, located on
the real property owned or leased by TCT are located entirely on such real
property. There is no pending or, to TCT's knowledge, threatened or contemplated
action to take by eminent domain or otherwise to condemn any material part of
any real property owned or leased by TCT. Except as set forth in Section 4.4(a)
of the TCT Disclosure Schedule, such transmitting towers, ground radials, guy
anchors, transmitting buildings and related improvements and other material
items of personal property, including equipment are, in TCT's reasonable
business judgment, in a state of good repair and maintenance and sound operating
condition, normal wear and tear excepted, have been maintained in a manner
consistent with generally accepted standards of sound engineering practice, and,
currently permit the TCT Business to be operated in all material respects in
accordance with the terms and conditions of all Applicable Laws, Governmental
Authorizations and Private Authorizations.
(b) Section 4.4(b) of the TCT Disclosure Schedule contains a true, accurate
and complete description of all Leases under which any real property used in the
business of TCT (the "TCT Business") is leased to TCT by any Person or by TCT to
any Person. Except as otherwise set forth in Section 4.4(b) of the TCT
Disclosure Schedule, each Lease under which TCT holds real or personal property
constituting a part of the TCT Assets has been duly authorized, executed and
delivered by TCT or its predecessor in interest thereunder and, to its
knowledge, each of the other parties thereto, and is a legal, valid and binding
obligation of TCT, and, to its knowledge, each of the other parties thereto,
enforceable in accordance with its terms, except as such enforceability may be
limited by bankruptcy, moratorium, insolvency and similar Laws affecting the
rights and remedies of creditors and obligations of debtors generally and by
general principles of equity. Except as would not, individually or in the
aggregate, have a material adverse effect on the TCT Assets or the TCT Business
taken as a whole, TCT has a valid leasehold interest in and enjoys peaceful and
undisturbed possession under all Leases pursuant to which it holds any such real
property or tangible personal property, subject to the terms of each Lease and
Applicable Law. None of the fixed assets or equipment comprising a part of the
TCT Assets is subject to contracts of sale, and none is held by TCT as lessee or
as conditional sales vendee under any Lease or conditional sales contract and
none is subject to any title retention agreement, except as set forth in Section
4.4(b) of the TCT Disclosure Schedule. True, accurate and complete copies of
each of such Leases will be made available by TCT to ATC and TCT will provide
ATC with photocopies of all such Leases requested by ATC (or true, accurate and
complete descriptions thereof have been set forth in Section 4.4(b) of the TCT
Disclosure Schedule, with respect to those that are oral). Except as would not,
individually or in the aggregate, have a material adverse effect on the TCT
Assets or the TCT Business taken as a whole, all of such Leases are valid and
subsisting and in full force and effect; neither TCT nor, to TCT's knowledge,
any other party thereto, has failed to duly comply with all of the material
terms and conditions of each such Lease or has done or performed, or failed to
do or perform (and no Claim is pending or, to the knowledge of TCT, threatened
to the effect that TCT has not so complied, done and performed or failed to do
and perform) any act which would invalidate or provide grounds for the other
party thereto to terminate (with or without notice, passage of time or both)
such Leases or impair the rights or benefits, or increase the costs, of TCT
under any of such Leases in any material respect.
4.5 Compliance with Private Authorizations. Section 4.5 of the TCT
--------------------------------------
Disclosure Schedule sets forth a true, accurate and complete list and
description of each Private Authorization which individually is material to the
TCT Assets or the TCT Business. TCT has obtained all Private Authorizations
that are
-8-
necessary for the ownership or operation of the TCT Assets or the conduct of the
TCT Business, as currently conducted or proposed to be conducted on or prior to
the Closing Date, which, if not obtained and maintained, could, individually or
in the aggregate, have a material adverse effect on TCT. Except as would not,
individually or in the aggregate, have a material adverse effect on the TCT
Assets or the TCT Business taken as a whole, all of such Private Authorizations
are valid and in good standing and are in full force and effect. TCT is not in
material breach or violation of, or in default in the performance, observance or
fulfillment of, any such Private Authorization, and no Event exists or has
occurred which constitutes, or but for any requirement of giving of notice or
passage of time or both would constitute, such a material breach, violation or
default, under any such Private Authorization. No such Private Authorization
that is material to the TCT Business is the subject of any pending or, to TCT's
knowledge, threatened attack, revocation or termination.
4.6 Compliance with Governmental Authorizations and Applicable Law.
--------------------------------------------------------------
(a) Section 4.6(a) of the TCT Disclosure Schedule contains a true, complete
and accurate description of each material Governmental Authorization required
under Applicable Law (i) to own and operate the TCT Assets and conduct the TCT
Business, as currently conducted or proposed to be conducted on or prior to the
Closing Date, all of which are in full force and effect or (ii) that is
necessary to permit TCT to execute and deliver this Agreement and to perform its
obligations hereunder. TCT has obtained all Governmental Authorizations that
are necessary for the ownership or operation of the TCT Assets or the conduct of
the TCT Business as now conducted and which, if not obtained and maintained,
would, individually or in the aggregate, have any material adverse effect on
TCT. None of the Governmental Authorizations listed in Section 4.6(a) of the
TCT Disclosure Schedule is subject to any restriction or condition that would
limit in any material respect the ownership or operations of the TCT Assets or
the conduct of the TCT Business as currently conducted, except for restrictions
and conditions generally applicable to Governmental Authorizations of such type.
The Governmental Authorizations listed in Section 4.6(a) of the TCT Disclosure
Schedule are valid and in good standing, are in full force and effect and are
not impaired in any material respect by any act or omission of TCT or its
officers, directors, employees or agents, and the ownership and operation of the
TCT Assets and the conduct of the TCT Business are in accordance in all material
respects with the Governmental Authorizations. All material reports, forms and
statements required to be filed by TCT with all Authorities with respect to the
TCT Business have been filed and are true, complete and accurate in all material
respects. No such Governmental Authorization is the subject of any pending or,
to TCT's knowledge, threatened challenge or proceeding to revoke or terminate
any such Governmental Authorization.
(b) Except as otherwise specifically set forth in Section 4.6(b) of the TCT
Disclosure Schedule, since January 1, 1998, TCT has conducted its business and
owned and operated its property and assets in accordance with all Applicable
Laws and Governmental Authorizations, except for such breaches, violations and
defaults as, individually or in the aggregate, have not had and are not
reasonably likely to have a material adverse effect on TCT. Except as otherwise
specifically described in Section 4.6(b) of the TCT Disclosure Schedule, TCT is
not is in and is not charged by any Authority with, and, to TCT's knowledge, is
not threatened or under investigation by any Authority with respect to, any
breach or violation of, or default in the performance, observance or fulfillment
of, any Applicable Law relating to the ownership and operation of the TCT Assets
or the conduct of the TCT Business which will, individually or in the aggregate,
have a material adverse effect on TCT. Except as otherwise specifically
described in Section 4.6(b) of the TCT Disclosure Schedule, no Event exists or
has occurred, which constitutes, or but for any requirement of giving of notice
or passage of time or both would constitute, such a breach, violation or
default, under any Governmental Authorization or any Applicable Law, except for
such breaches, violations or defaults as, individually or in the aggregate, have
not had and reasonably would not have a material adverse effect on
-9-
TCT. With respect to matters, if any, of a nature referred to in Section 4.6(b)
of the TCT Disclosure Schedule, except as otherwise specifically described in
Section 4.6(b) of the TCT Disclosure Schedule, all such information and matters
set forth in the TCT Disclosure Schedule, if adversely determined against TCT,
individually or in the aggregate, would not reasonably be expected to have a
material adverse effect on TCT.
(c) Except as set forth in Section 4.6(c) of the TCT Disclosure Schedule,
there have not been since the formation of TCT and there are no Legal Actions of
any kind pending or, to the knowledge of TCT, threatened at law, in equity or
before any Authority against TCT or any of its officers or Management Committee
representatives relating to the ownership or operation of the TCT Assets or the
conduct of the TCT Business. Such disclosed Legal Actions, if determined
adversely to TCT, individually or in the aggregate, would not reasonably be
expected to not have a material adverse effect on TCT; such disclosed Legal
Actions could not materially and adversely affect the ability of TCT to perform
its obligations under this Agreement, nor are there any judgments or orders
outstanding against TCT that could have such effect.
4.7 Intangible Assets. Section 4.7 of the TCT Disclosure Schedule sets
-----------------
forth a true, accurate and complete description of all Intangible Assets (other
than Governmental Authorizations and Private Authorizations and Leases) relating
to the ownership and operation of the TCT Assets or the conduct of the TCT
Business held or used by TCT, including without limitation the nature of TCT's
interest in each and the extent to which the same have been duly registered in
the offices as indicated therein. Except as set forth in Section 4.7 of the TCT
Disclosure Schedule, no Intangible Assets (except Governmental Authorizations,
Private Authorizations, and the Intangible Assets so set forth) are required for
the ownership or operation of the TCT Assets or the conduct of the TCT Business
as currently owned, operated and conducted or proposed to be owned, operated and
conducted on or prior to the Closing Date. TCT does not, to its knowledge,
wrongfully infringe upon or unlawfully use any Intangible Assets owned or
claimed by another, and TCT has not received any notice of any claim or
infringement relating to any such Intangible Asset.
4.8 Related Transactions. TCT is not a party or subject to any
--------------------
Contractual Obligation relating to the ownership or operation of the TCT Assets
or the conduct of the TCT Business between TCT and any of its officers or
Management Committee representatives or, to the knowledge of TCT, any member of
the Immediate Family of any thereof or any Affiliate of any of the foregoing,
including without limitation any Contractual Obligation providing for the
furnishing of services to or by, providing for rental of property, real,
personal or mixed, to or from, or providing for the lending or borrowing of
money to or from or otherwise requiring payments to or from, any such Person,
other than (a) Employment Arrangements listed or described in Section 4.14 of
the TCT Disclosure Schedule, (b) Contractual Obligations between TCT and any of
its officers, Management Committee representatives or Affiliates of TCT or any
of the foregoing, that will be terminated, at no cost or expense to ATC, prior
to the Closing, or (c) as specifically set forth in Section 4.8 of the TCT
Disclosure Schedule.
4.9 Insurance. TCT maintains, with respect to the TCT Assets and the TCT
---------
Business, policies of fire and extended coverage and casualty, liability and
other forms of insurance in such amounts and against such risks and losses as
are set forth in Section 4.9 of the TCT Disclosure Schedule.
4.10 Tax Matters. TCT has, in accordance with all Applicable Laws, filed
-----------
all Tax Returns that it was required to file, and has paid, or made adequate
provision on the most recent balance sheet forming part of the TCT Financial
Statements for the payment of, all material Taxes which have or may become due
and payable pursuant to said Tax Returns other than those Taxes being contested
in good faith for which adequate provision has been made. The Tax Returns of
TCT have been prepared in all material respects in accordance with all
Applicable Laws. All material Taxes which TCT is required by law to withhold
and collect have been duly withheld and collected, and have been paid over, in a
timely manner, to the proper
-10-
Taxing Authorities to the extent due and payable. TCT has not executed any
waiver to extend, or otherwise taken or failed to take any action that would
have the effect of extending, the applicable statute of limitations in respect
of any Tax liabilities of TCT for the fiscal years prior to and including the
most recent fiscal year. Adequate provision has been made on the most recent
balance sheet forming part of the TCT Financial Statements for all Taxes accrued
through the date of such balance sheet in accordance with GAAP whether disputed
or not, and there are, to TCT's knowledge, no past transactions or matters which
could result in additional Taxes of a material nature being imposed on TCT for
which an adequate reserve has not been provided on such balance sheet. TCT has
at all times been classified as a partnership under the Code and, except as set
forth in Section 4.10 of the TCT Disclosure Schedule, has been similarly
classified under all state and local income Tax Laws to which it is subject; TCT
has never been a publicly traded partnership treated as a corporation under
Section 7704 of the Code, and, except as set forth in Section 4.10 of TCT
Disclosure Schedule, has never been similarly classified under state and local
income Tax Laws to which it is subject. TCT has never been a member of any
"affiliated group" of corporations, within the meaning of Section 1504(a) of the
Code. TCT is not a party to any tax sharing agreement or arrangement.
At all times during its existence, each member of TCT has been a "United
States person" as defined in Section 7701(a)(30) of the Code as then in effect.
TCT has complied with all material withholding obligations under Sections
1445(e)(1) or 1446 of the Code, and under any comparable provisions of state or
local income Tax Laws.
Except as disclosed in Section 4.10 of the TCT Disclosure Schedule and for
Taxes of a nature referred to in Section 10.2, the completion of the
Transactions will not (either alone or upon the occurrence of any additional or
subsequent Event) result in TCT being subject to additional Taxes which,
individually or in the aggregate, are material.
4.11 Employee Retirement Income Security Act of 1974.
-----------------------------------------------
(a) TCT (which for purposes of this Section shall include any ERISA
Affiliate of TCT) currently sponsors, maintains and contributes only to the
Plans and Benefit Arrangements set forth in Section 4.11(a) of the TCT
Disclosure Schedule. TCT has delivered or made available to ATC true, complete
and correct copies of (i) each Plan and Benefit Arrangement (or, in the case of
any unwritten Plans or Benefit Arrangements, reasonable descriptions thereof),
(ii) the two most recent annual reports on Form 5500 (including all schedules
and attachments thereto) filed with the Internal Revenue Service with respect to
each Plan or Benefit Arrangement (if any such report was required by Applicable
Law), (iii) the most recent summary plan description (or similar document) for
each Plan for which such a summary plan description is required by Applicable
Law or was otherwise provided to plan participants or beneficiaries, and (iv)
each trust agreement and insurance or annuity contract or other funding or
financing arrangement relating to any Plan. To the knowledge of TCT, each such
Form 5500 and each such summary plan description (or similar document) does not,
as of the date hereof, contain any material misstatements. Except as set forth
in Section 4.11(a) of the TCT Disclosure Schedule, TCT does not contribute to or
have an obligation to contribute to, and has not at any time contributed to or
had an obligation to contribute to, and no Plan listed in Section 4.11(a) of the
TCT Disclosure Schedule is, (i) an employee pension benefit plan within the
meaning of Section 3(2) of ERISA, (ii) a Multiemployer Plan, or (iii) a Plan
subject to Section 412 of the Code, Section 302 of ERISA or Title IV of ERISA.
TCT has no actual or potential liability under Title IV of ERISA. TCT does not
maintain any Plan that provides for post-retirement medical or life insurance
benefits, and TCT does not have any obligation or liability with respect to any
such Plan previously maintained by TCT, except as the provisions of COBRA may
apply to any former employees of TCT. Except as set forth in Section 4.11(a) of
the TCT Disclosure Schedule, as to all Plans and Benefit Arrangements listed in
Section 4.11(a) of the TCT Disclosure Schedule:
-11-
(i) all such Plans and Benefit Arrangements comply and have been
administered in form and in operation, in all material respects, in
accordance with their respective terms and with all Applicable Laws and TCT
has not received any notice from any Authority that it is currently or is
going to be disputing or investigating such compliance;
(ii) none of the assets of any such Plan are invested in employer
securities or employer real property;
(iii) there are no Claims (other than routine Claims for benefits or
actions seeking quali fied domestic relations orders) pending or, to TCT's
knowledge, threatened involving such Plans or the assets of such Plans,
and, to TCT's knowledge, no facts exist which are reasonably likely to give
rise to any such Claims (other than routine Claims for benefits or actions
seeking qualified domestic relations orders);
(iv) all material contributions to, and material payments from, the
Plans and Benefit Arrangements that may have been required to be made in
accordance with the terms of the Plans and Benefit Arrangements, and any
applicable collective bargaining agreement, have been made. All such
contributions to, and payments from, the Plans and Benefit Arrangements,
except those payments to be made from a trust qualified under Section
401(a) of the Code, for any period ending before the Closing Date that are
not yet, but will be, required to be made, will be properly accrued and
reflected on the financial books and records of TCT;
(v) no Event has occurred which would result in imposition on TCT of
any material liability for (A) any breach of fiduciary duty damages under
Section 409 of ERISA, (B) a civil penalty assessed pursuant to subsections
(c), (i) or (l) of Section 502 of ERISA or (C) a tax imposed pursuant to
Chapter 43 of Subtitle D of the Code;
(vi) TCT has not incurred any material liability to a Plan (other
than for contributions not yet due) which liability has not been fully
paid or accrued for payment as of the date hereof;
(vii) except as otherwise set forth in Section 4.11(a) of the TCT
Disclosure Schedule, no current or former employee of TCT will be entitled
to any additional benefits or any acceleration of the time of payment or
vesting of any benefits under any Plan or Benefit Arrangement as a result
of the transactions contemplated by this Agreement;
(viii) no compensation payable by TCT to any of its employees under
any existing Plan or Benefit Arrangement (including by reason of the
transactions contemplated hereby) will be subject to disallowance under
Section 162(m) of the Code; and
(ix) any amount that could be received (whether in cash or property
or by virtue of the vesting of property) as a result of any of the
transactions contemplated by this Agreement by any employee, officer,
director or independent contractor of TCT who is a "disqualified
individual" (as such term is defined in proposed Regulation Section 1.280G-
1) under any employment arrangement would not be characterized as an
"excess parachute payment" (as such term is defined in Section 280G(b)(1)
of the Code), except for any amount that is approved by the stockholders of
TCT on or before the Closing Date in the manner provided in Section
280G(b)(5) of the Code.
-12-
(b) The execution, delivery and performance by TCT of this Agreement and
the Collateral Documents executed or required to be executed by TCT pursuant
hereto and thereto will not involve any prohibited transaction within the
meaning of ERISA or Section 4975 of the Code with respect to any Plan listed in
Section 4.11(a) of the TCT Disclosure Schedule.
4.12 Solvency. As of the execution and delivery of this Agreement, TCT
--------
is, and immediately prior to and immediately after giving effect to the
consummation of the Merger will be, Solvent.
4.13 Bank Accounts, Etc. Section 4.13 of the TCT Disclosure Schedule
------------------
contains a true, accurate and complete list as of the date hereof of all banks,
trust companies, savings and loan associations and brokerage firms in which TCT
has an account or a safe deposit box and the names of all Persons authorized to
draw thereon, to have access thereto, or to authorize transactions therein, the
names of all Persons, if any, holding valid and subsisting powers of attorney
from TCT and a summary statement as to the terms thereof. TCT agrees that prior
to the Closing Date it will not make or permit to be made any change affecting
any bank, trust company, savings and loan association, brokerage firm or safe
deposit box or in the names of the Persons authorized to draw thereon, to have
access thereto or to authorize transactions therein or in such powers of
attorney, or open any additional accounts or boxes or grant any additional
powers of attorney, without in each case first notifying ATC in writing.
4.14 Employment and Consulting Arrangements. Section 4.14 of the TCT
--------------------------------------
Disclosure Schedule contains a true, accurate and complete list of all TCT
employees and consultants, exclusive of consultants whose services for TCT are
terminable within thirty (30) days without liability, penalty or payment of any
kind by TCT or any Affiliate of TCT (the "TCT Employees"), together with each
such Person's title or the capacity in which he or she is employed or retained
and each such Person's compensation. TCT has no obligation or liability,
contingent or other, under any Employment Arrangement with any TCT Employee,
other than (i) those listed or described in Section 4.14 of the TCT Disclosure
Schedule, (ii) those incurred in the ordinary and usual course of business, or
(iii) such obligations or liabilities as do not and will not have, in the
aggregate, any material adverse effect on TCT. Except as described in Section
4.14 of the TCT Disclosure Schedule, (a) none of the TCT Employees is now, or
since its organization has been, represented by any labor union or other
employee collective bargaining organization, and TCT is not, and never has been,
a party to any labor or other collective bargaining agreement with respect to
any of the TCT Employees, (b) there are no pending grievances, disputes or
controversies with any union or any other employee or collective bargaining
organization of such employees, or threats of strikes, work stoppages or
slowdowns or any pending demands for collective bargaining by any such union or
other organization, and (c) neither TCT nor any of such employees is now, or has
since its organization been, subject to or involved in or, to TCT's knowledge,
threatened with, any union elections, petitions therefor or other organizational
activities, in each case with respect to the TCT Employees. TCT has performed
in all material respects all obligations required to be performed under all
Employment Arrangements and is not in material breach or violation of or in
material default or arrears under any of the terms, provisions or conditions
thereof.
4.15 Material Agreements. Listed on Section 4.15 of the TCT Disclosure
-------------------
Schedule are all Material Agreements (other than Leases, Private Authorizations
and Governmental Authorizations) relating to the ownership or operation of the
TCT Assets or the conduct of the TCT Business or to which TCT is a party or to
which it is bound or to which any of the TCT Assets is subject. True, accurate
and complete copies of each of such Material Agreements have been made available
by TCT to ATC, and TCT will provide ATC with photocopies of all such Material
Agreements requested by ATC (or true, accurate and complete descriptions thereof
have been set forth in Section 4.15 of the TCT Disclosure Schedule with respect
to Material Agreements comprised of site leases and site licenses granted by TCT
to third parties and with respect to Material Agreements that are oral). All of
such Material Agreements are valid, binding and
-13-
legally enforceable obligations of TCT and, to its knowledge, all other parties
thereto, except as such enforceability may be limited by bankruptcy, moratorium,
insolvency and similar Laws affecting the rights and remedies of creditors and
obligations of debtors generally and by general principles of equity. Except as
would not, individually or in the aggregate, have a material adverse effect on
the TCT Assets or the TCT Business taken as a whole, neither TCT nor, to its
knowledge, any other party thereto, has failed to duly comply with all of the
material terms and conditions of each such Material Agreement or has done or
performed, or failed to do or perform (and no Claim is pending or, to the
knowledge of TCT, threatened in writing to the effect that TCT has not so
complied, done and performed or failed to do and perform) any act which would
invalidate or provide grounds for the other party thereto to terminate (with or
without notice, passage of time or both) such Material Agreement or impair the
rights or benefits, or materially increase the costs, of TCT under any of such
Material Agreement.
4.16 Ordinary Course of Business. TCT, from the date of the most recent
---------------------------
TCT Financial Statements to the date hereof, except (i) as may be described on
Section 4.16 of the TCT Disclosure Schedule, (ii) as may be required or
expressly contemplated by the terms of this Agreement, or (iii) as may be
described in the TCT Financial Statements, including the notes thereto:
(a) has operated its business in all material respects in the normal,
usual and customary manner in the ordinary and regular course of business,
consistent with prior practice;
(b) except in each case in the ordinary course of business, consistent
with prior practice:
(i) has not incurred any obligation or liability (fixed,
contingent or other) individually having a value in excess of $50,000;
(ii) has not sold or otherwise disposed of or contracted to sell
or otherwise dispose of any of its properties or assets having a value
in excess of $50,000;
(iii) has not entered into any individual commitment having a
value in excess of $50,000; and
(iv) has not canceled any debts or claims;
(c) has not created or permitted to be created any Lien on any of the
TCT Assets, except for Permitted Liens;
(d) has not made or committed to make any additions to its property or
any purchases of equipment, except in the ordinary course of business
consistent with past practice or for normal maintenance and replacements;
(e) has not increased the compensation payable or to become payable to
any of the TCT Employees other than increases in the ordinary course of
business, or otherwise materially altered, modified or changed the terms of
their employment;
(f) has not suffered any material damage, destruction or loss (whether
or not covered by insurance) or any acquisition or taking of property by
any Authority;
(g) has not waived any rights of material value without fair and
adequate consideration;
-14-
(h) has not experienced any work stoppage;
(i) except in the ordinary course of business, has not entered into,
amended or terminated any Lease, Governmental Authorization, Private
Authorization, Material Agreement or Employment Arrangement, or any
transaction, agreement or arrangement with any Affiliate of TCT;
(j) has not issued or sold, or agreed to issue or sell, any shares of
TCT Units, other shares of capital stock, Convertible Securities or Option
Securities;
(k) has not made, paid or declared any Distribution; and
(l) has not entered into any transactions or series of related
transactions which individually or in the aggregate is material to the TCT
Assets or the TCT Business.
4.17 Material and Adverse Restrictions. TCT is not a party to or subject
---------------------------------
to, nor is any of the TCT Assets subject to, any Employment Arrangement, Lease,
Material Agreement or Private Authorization which, individually or in the
aggregate, has had or, as far as TCT can now reasonably foresee, have, a
material adverse effect on TCT, except as set forth in Section 4.17 of the TCT
Disclosure Schedule and except for matters affecting the communications site
industry generally and assuming the TCT Business continues to be operated
substantially as in the past.
4.18 Broker or Finder. No Person assisted in or brought about the
----------------
negotiation of this Agreement or the Merger in the capacity of broker, agent or
finder or in any similar capacity on behalf of TCT or any TCT Member.
4.19 Environmental Matters. Except as set forth in Section 4.19 of the
---------------------
TCT Disclosure Schedule, TCT:
(a) has not been notified that it is potentially liable under, has not
received any request for information or other correspondence concerning its
potential liability with respect to any site or facility under, and, to
TCT's knowledge, is not a "potentially responsible party" under, the
Comprehensive Environmental Response, Compensation and Liability Act of
1980, as amended, the Resource Conservation Recovery Act, as amended, or
any similar state Law;
(b) has not entered into or received any consent decree, compliance
order or administrative order issued pursuant to any Environmental Law;
(c) is not a party in interest or in default under any judgment,
order, writ, injunction or decree of any Final Order issued pursuant to any
Environmental Law;
(d) has, to its knowledge, obtained all material Environmental Permits
required under Environmental Laws, and has filed all material applications,
notices and other documents required to be filed prior to the date of this
Agreement to effect the timely renewal or issuance of all Environmental
Permits for the continued ownership or operation of the TCT Assets or
conduct of the TCT Business in the manner currently owned, operated and
conducted or proposed to be owned, operated and conducted prior to the
Closing Date;
(e) is in compliance in all material respects with all Environmental
Laws, and is not the subject of or, to TCT's knowledge, threatened with any
Legal Action involving a demand for damages or other potential liability,
including any Lien, with respect to violations or breaches of any
Environmental Law;
-15-
(f) has not conducted or received any site assessment, audit or other
investigation as to material environmental matters at any property
currently owned, leased, operated or occupied by TCT;
(g) has not installed or used any above ground or underground storage
tanks, friable asbestos, polychlorinated biphenyls or urea formaldehyde
foam insulation on any property currently owned, leased or operated by TCT
and, to its knowledge, there are no above ground or underground storage
tanks, friable asbestos, polychlorinated biphenyls or urea formaldehyde
foam insulation on any property currently owned, leased or operated by TCT;
and
(h) has no knowledge of any past or present Event related to TCT's
properties, operations or business, which Event, individually or in the
aggregate, could reasonably be expected to interfere with or prevent
continued compliance in all material respects with all Environmental Laws
applicable to the ownership or operation of the TCT Assets to the conduct
of the TCT Business substantially in the manner now conducted, or which,
individually or in the aggregate, may form the basis of any material Claim
for or arising out of the release or threatened release into the
environment of any Hazardous Material.
Section 4.19 of the TCT Disclosure Schedule sets forth a true, correct and
complete list of all existing Phase I environmental site assessment reports (an
"Environmental Report") on each parcel of Real Property owned or leased by TCT
for which an Environmental Report has previously been prepared for TCT (true,
correct and complete copies of which have heretofore been delivered by TCT to
ATC).
4.20 Capital Stock. The authorized and outstanding equity interests of TCT
-------------
are as set forth in Section 4.20 of the TCT Disclosure Schedule. All of the
outstanding TCT Units have been duly authorized and validly issued, are fully
paid and nonassessable and are not subject to any preemptive or similar rights
and are owned of record and, to TCT's knowledge, beneficially as shown in
Section 4.20 of the TCT Disclosure Schedule. No certificates have been issued
evidencing ownership of TCT Units. Except as set forth in Section 4.20 of the
TCT Disclosure Schedule, TCT has not granted or issued, nor has TCT agreed to
grant or issue, any TCT Units, other equity interests, or any Option Security or
Convertible Security, and TCT is not a party to or bound by any agreement, put
or commitment pursuant to which it is obligated to purchase, redeem or otherwise
acquire any equity interests in TCT or any Option Security or Convertible
Security.
4.21 Year 2000 Compliant. TCT has reviewed the areas within their
-------------------
business and operations which TCT believes could be materially and adversely
affected by the "Year 2000 Problem" (that is, the risk that computer
applications used by TCT may be unable to recognize and perform properly date-
sensitive functions involving certain dates prior to and any date on or after
December 31, 1999). Based on such reviews, TCT believes that the "Year 2000
Problem" will not have a material adverse effect on TCT. Except as set forth in
Section 4.21 of the TCT Disclosure Schedule, to TCT's knowledge, each hardware,
software and firmware product (collectively "Software") used by TCT in its
business is Year 2000 compliant, except for such noncompliance that does not and
could not reasonably be expected to have a material adverse effect on TCT.
4.22 Materiality. The representations and warranties set forth in this
-----------
Article are true and correct as of the date hereof without the materiality
exceptions or qualifications contained therein, except to the
-16-
extent that the failure of such representations and warranties to be so true and
correct, individually or in the aggregate, would not have a material adverse
effect on TCT.
ANYTHING IN THIS ARTICLE TO THE CONTRARY NOTWITHSTANDING, ATC AND ATI
ACKNOWLEDGE AND AGREE THAT TCT HAS NOT HERETOFORE DELIVERED TO THEM THE TCT
DISCLOSURE SCHEDULE AND THAT IT WILL BE DELIVERED PURSUANT TO THE PROVISIONS OF
SECTION 10.14.
ARTICLE 5
REPRESENTATIONS AND WARRANTIES OF ATC AND ATI
---------------------------------------------
Each of ATC and ATI, jointly and severally, hereby represents and warrants
to TCT and the TCT Members as follows:
5.1 Organization and Business; Power and Authority; Effect of Transaction.
---------------------------------------------------------------------
(a) Each of ATC and ATI is a corporation duly organized, validly existing
and in good standing under the laws of its jurisdiction of organization, has all
requisite power and authority (corporate and other) to own or hold under lease
its properties and to conduct its business as now conducted and is duly
qualified and in good standing as a foreign corporation in each other
jurisdiction in which the character of the property owned or leased by it or the
nature of its business or operations requires such qualification, except for
such qualifications the failure of which to obtain, individually or in the
aggregate, would not have a material adverse effect on ATC.
(b) Each of ATC and ATI has all requisite power and authority (corporate
and other) necessary to enable it to execute and deliver, and to perform its
obligations under, this Agreement and each Collateral Document executed or
required to be executed by it pursuant hereto or thereto and to consummate the
Transactions; and the execution, delivery and performance by ATC and ATI of this
Agreement and each Collateral Document executed or required to be executed by it
pursuant hereto or thereto have been duly authorized by all requisite corporate
or other action on the part of ATC and ATI. This Agreement has been duly
executed and delivered by ATC and ATI and constitutes, and each Collateral
Document executed or required to be executed by each of them pursuant hereto or
thereto or to consummate the Transactions when executed and delivered by ATC and
ATI will constitute, legal, valid and binding obligations of each of ATC and
ATI, enforceable in accordance with their respective terms, except as such
enforceability may be limited by bankruptcy, moratorium, insolvency and similar
Laws affecting the rights and remedies of creditors and obligations of debtors
generally and by general principles of equity.
(c) Except to the extent necessary under its credit facilities, neither the
execution and delivery by ATC and ATI of this Agreement or any Collateral
Document executed or required to be executed by each of them pursuant hereto or
thereto, nor the consummation of the Transactions, nor compliance with the
terms, conditions and provisions hereof or thereof by ATC and ATI:
(i) will conflict with, or result in a breach or violation of, or
constitute a default under, any Organic Document of ATC or ATI or any
Applicable Law, or will conflict with, or result in a breach or violation
of, or constitute a default under, or permit the acceleration of any
obligation or liability in, or but for any requirement of giving of notice
or passage of time or both would constitute such a conflict with, breach or
violation of, or default under, or permit any such acceleration in, any
Material Obligation of ATC or ATI; or
-17-
(ii) will require ATC or ATI to make or obtain any Governmental
Authorization, Governmental Filing or Private Authorization, except (A)
filings contemplated by the Registration Rights Agreement, (B) filings
under the Xxxx-Xxxxx-Xxxxxx Act, (C) for FCC approvals, (D) the filing with
the Commission of such reports under Section 13(a) or 15(d) of the Exchange
Act as may be required in connection with this Agreement and the
transactions contemplated hereby, (E) the filing of the Certificate of
Merger with the Delaware Secretary of State, and appropriate documents with
the relevant authorities of other states in which ATI is qualified to do
business, (F) the filing of a Supplemental Listing Application with the New
York Stock Exchange, and (G) such other Governmental Authorizations,
Governmental Filings, and Private Authorizations the failure of which to be
made or obtained would not, individually or in the aggregate, have a
material adverse effect on ATC.
5.2 ATC SEC Reports. ATC has heretofore made available to TCT its Annual
---------------
Report on Form 10-K for its most recent fiscal year for which such a report has
been filed and its Quarterly Reports on Form 10-Q for all fiscal quarters for
which such a report has been filed (collectively, the "ATC SEC Documents"). As
of the respective dates thereof, the ATC SEC Documents were prepared in all
material respects in accordance with the Exchange Act and did not contain any
untrue statement of a material fact or omit to state any material fact required
to be stated therein or necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading. ATC has timely
filed all forms, reports and documents with the SEC required to be filed by it
pursuant to the Securities Act and the Exchange Act which complied as to form,
at the time such form, document or report was filed, in all material respects
with the applicable requirements of the Securities Act and the Exchange Act.
The consolidated financial statements of ATC included in the ATC SEC Documents
(the "ATC Financial Statements"), including in each case the notes thereto, have
been prepared in accordance with GAAP applied on a consistent basis throughout
the periods covered thereby, except as otherwise noted therein, are true,
accurate and complete in all material respects, and fairly present the
consolidated financial condition and the consolidated results of operations and
cash flow of ATC, on the bases therein stated, as of the respective dates
thereof, and for the respective periods covered thereby subject, in the case of
unaudited financial statements, to normal nonmaterial year-end audit adjustments
and accruals. As of the respective dates thereof, all forms, reports and
documents to be filed by ATC with the SEC pursuant to the Securities Act and the
Exchange Act between the date of this Agreement and the Closing Date will comply
as to form, at the time such form, document or report is filed, in all material
respects with the applicable requirements of the Securities Act and the Exchange
Act and will not contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading.
5.3 Material Statements and Omissions; Absence of Events. Neither any
----------------------------------------------------
representation or warranty made by ATC or ATI contained in this Agreement or any
certificate, document or other instrument furnished or to be furnished by ATC or
ATI pursuant to the provisions hereof nor the ATC SEC Documents contains or will
contain any untrue statement of a material fact or omits or will omit to state
any material fact required to make any statement contained herein or therein, in
light of the circumstances under which they were made, not misleading. Since
the date of the most recent financial statements constituting a part of the ATC
Financial Statements, except to the extent specifically described in the ATC SEC
Documents, there has been no change with respect to ATC or any of its
Subsidiaries that has had a material adverse effect on ATC. There is no Event
known to ATC which has had or (so far as ATC can now reasonably foresee) is
likely to have a material adverse effect on ATC, except to the extent
specifically described in the ATC SEC Documents. ATC is not aware of any
impending or contemplated Event that would cause any of the representations and
warranties made by it in this Article not to be true, correct and complete on
the date of such Event as if made on that date.
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5.4 Broker or Finder. No Person assisted in or brought about the
----------------
negotiation of this Agreement or the Transactions in the capacity of broker,
agent or finder or in any similar capacity on behalf of ATC or ATI.
5.5 Capital Stock. The authorized and outstanding capital stock of ATC,
-------------
as of the date set forth therein, is as set forth in the most recent ATC SEC
Documents. All of such outstanding capital stock has been, and, when issued in
accordance with the terms of this Agreement, the ATC Common Stock to be issued
upon consummation of the Merger will be, duly authorized and validly issued,
fully paid and nonassessable and not subject to any preemptive or similar
rights, and free and clear of all Liens attributable to any action or failure to
act of ATC or any of the Subsidiaries. Since the date as of which information
is set forth in the most recent ATC SEC Documents, ATC has not issued (a) any
shares of common stock of any class, except (i) upon conversion of shares of one
class into shares of another class, (ii) upon exercise of options referred to in
the most recent ATC Financial Statements, (iii) pursuant to the consummation of
acquisitions referred to in the ATC SEC Documents, or (iv) pursuant to the
consummation of an acquisition as part of which an aggregate of 1,430,879 shares
of ATC Common Stock were issued, or (b) any Convertible Securities or Option
Securities, except for the issue of stock options under its 1997 Stock Option
Plan, as amended and restated. Except as disclosed in the ATC SEC Documents,
all outstanding shares of capital stock of the Significant Subsidiaries (as
defined for purposes of Regulations S-X under the Exchange Act and including, in
any event, ATI) of ATC are owned by ATC (in the case of ATI and certain of such
other Significant Subsidiaries) or a direct or indirect wholly-owned Subsidiary
of ATC.
5.6 Compliance with Governmental Authorizations and Applicable Law.
--------------------------------------------------------------
(a) ATC and its Subsidiaries have conducted their respective business and
owned and operated their respective property and assets in accordance with all
Applicable Laws (including without limitation all Environmental Laws) and
Governmental Authorizations, except for such breaches, violations and defaults
as, individually or in the aggregate, have not had and are not reasonably likely
to have a material adverse effect on ATC. Neither ATC nor any of its
Subsidiaries, as of the date of this Agreement, is in, or is charged by any
Authority with, or, to ATC's knowledge, is threatened or under investigation by
any Authority with respect to, any breach or violation of, or default in the
performance, observance or fulfillment of, any Applicable Law (including without
limitation any Environmental Laws) relating to the ownership and operation of
their respective assets or the conduct of their respective businesses which,
individually or in the aggregate, has had or will have a material adverse effect
on ATC. No Event exists or has occurred, as of the date of this Agreement,
which constitutes, or but for any requirement of giving of notice or passage of
time or both would constitute, such a breach, violation or default, under any
Governmental Authorization or any Applicable Law (including without limitation
any Environmental Law), except for such breaches, violations or defaults as,
individually or in the aggregate, have not had and will not have a material
adverse effect on ATC.
(b) There are, as of the date of this Agreement, no Legal Actions of any
kind pending or, to the knowledge of ATC, threatened at law, in equity or before
any Authority against ATC or any of its Subsidiaries or the officers or
directors of any thereof relating to the ownership or operation of their
respective assets or the conduct of their respective businesses which, if
determined adversely to ATC, individually or in the aggregate, will have a
material adverse effect on ATC or which could materially and adversely affect
the ability of ATC or ATI to perform its obligations under this Agreement, nor
are there any judgments or orders outstanding against ATC or ATI that could have
such effect.
-19-
5.7 Materiality. The representations and warranties set forth in this
-----------
Article are true and correct as of the date hereof without the materiality
exceptions or qualifications contained therein, except to the extent that the
failure of such representations and warranties to be so true and correct,
individually or in the aggregate, would not have a material adverse effect
on ATC.
ARTICLE 6
COVENANTS
6.1 Access to Information; Confidentiality.
--------------------------------------
(a) Each party shall afford to the other party and its accountants,
counsel, financial advisors and other representatives (the "Representatives")
full access during normal business hours throughout the period prior to the
Closing Date to all of its (and its Subsidiaries') properties, books, contracts,
insurance policies, studies and reports, environmental studies and reports,
commitments and records (including without limitation Tax Returns) and, during
such period, shall furnish promptly upon written request (i) a copy of each
report, schedule and other document filed or received by any party pursuant to
the requirements of any Applicable Law or filed by it with any Authority in
connection with the Merger or any other report, schedule or documents which may
have a material effect on the businesses, operations, properties, prospects,
personnel, condition (financial or other), or results of operations of their
respective businesses, (ii) to the extent not provided for pursuant to the
immediately preceding clause, in the case of TCT, all financial records,
ledgers, work papers and other sources of financial information possessed or
controlled by it or its accountants deemed by ATC or its Representatives
necessary or useful for the purpose of performing an audit of the business and
assets of TCT, and (iii) such other information concerning any of the foregoing
as ATC or TCT shall reasonably request. All Confidential Information furnished
pursuant to the provisions of this Agreement, including without limitation this
Section, will be kept confidential and shall not, without the prior written
consent of the party disclosing such Confidential Information, be disclosed by
the other party in any manner whatsoever, in whole or in part, and, except as
required by Applicable Law (including without limitation in connection with any
registration, proxy or information statement or similar document filed pursuant
to any federal or state securities Law) shall not be used for any purposes,
other than in connection with the Merger. Except as otherwise herein provided,
each party agrees to reveal such Confidential Information only to those of its
Representatives or other Persons who it believes need to know such Confidential
Information for the purpose of evaluating and consummating the Merger. For
purposes of this Agreement, "Confidential Information" shall mean any and all
information (excluding information that (i) has been or is obtained from a
source independent of the disclosing party that, to the receiving party's
knowledge, is not subject to any confidentiality restriction, (ii) is or becomes
generally available to the public other than as a result of unauthorized
disclosure by the receiving party, or (iii) is independently developed by the
receiving party without reliance in any way on information provided by the
disclosing party or a third party independent of the disclosing party that, to
the receiving party's knowledge, is not subject to any confidentiality
restriction) related to the business or businesses of ATC, ATI and their
respective Affiliates or TCT and its Affiliates, including any of their
respective successors and assigns.
(b) Notwithstanding the provisions of Section 6.1(a), (i) each party may
disclose such information as it may reasonably determine to be necessary in
connection with seeking all Governmental and Private Authorizations or that is
required by Applicable Law to be disclosed, including without limitation in any
registration, proxy or information statement or other document required to be
filed under any federal or state securities Law, and (ii) ATC may, with the
prior written consent of TCT, which consent
-20-
shall not be unreasonably withheld, delayed or conditioned, disclose the subject
matter of this Agreement to Persons with whom TCT has a business or contractual
relationship in connection with ATC's due diligence investigation of TCT. In the
event that this Agreement is terminated in accordance with its terms, each party
shall promptly redeliver all written Confidential Information provided pursuant
to this Section or any other provision of this Agreement or otherwise in
connection with the Merger and shall not retain any copies, extracts or other
reproductions in whole or in part of such written material, other than one copy
thereof which shall be delivered to independent counsel for such party which
shall be bound by the provisions of Section 6.1(a).
(c) Anything in this Section or elsewhere in this Agreement to the contrary
notwithstanding, either party may disclose information received or retained by
it in accordance with the provisions of this Agreement if it can demonstrate (i)
such information is generally available to or known by the public from a source
other than the party seeking to disclose such information or (ii) was obtained
by the party seeking to disclose such information from a source other than the
other party, provided that such source was not bound by a duty of
confidentiality to the other party or another party with respect to such
information.
(d) No investigation pursuant to this Section or otherwise shall affect any
representation or warranty in this Agreement of any party or any condition to
the obligations of the parties hereto.
(e) The provisions of this Section shall apply to all Subsidiaries of ATC
and TCT.
6.2 Agreement to Cooperate; Certain Other Covenants.
-----------------------------------------------
(a) Each of the parties hereto shall use reasonable business efforts (x) to
take, or cause to be taken, all actions and to do, or cause to be done, all
things necessary, proper or advisable under Applicable Law to consummate the
Merger and the other Transactions, and (y) to refrain from taking, or cause to
be taken, any action and to refrain from doing or causing to be done, anything
which could impede or impair the consummation of the Merger or the consummation
of the other Transactions, including, in all cases, without limitation using its
reasonable business efforts (i) to prepare and file with the applicable
Authorities as promptly as practicable after the execution of this Agreement all
requisite applications and amendments thereto, together with related
information, data and exhibits, necessary to request issuance of orders
approving the Merger by all such applicable Authorities, (ii) to obtain all
necessary or appropriate waivers, consents and approvals, (iii) to effect all
necessary registrations, filings and submissions (including without limitation
filings within five (5) business days of the date of this Agreement under the
Xxxx-Xxxxx-Xxxxxx Act and all filings necessary for ATI to own and operate the
TCT Assets and the TCT Business), (iv) to lift any injunction or other legal bar
to the Merger (and, in such case, to proceed with the Merger as expeditiously as
possible), and (v) to obtain the satisfaction of the conditions specified in
Article 8, and (vi) to advise the other of, in the case of TCT, any changes that
would be required in the TCT Disclosure Schedule if the applicable
representations and warranties set forth in Article 4 did not refer to the date
of this Agreement and, in the case of ATC, of the information with respect to
its authorized and issued capital stock, other than as a consequence of matters
heretofore disclosed by ATC to TCT, including without limitation those set forth
in the ATC SEC Documents.
(b) The parties shall cooperate with one another in the preparation of all
Tax Returns, questionnaires, applications or other documents (i) regarding any
Taxes or transfer, recording, registration or other fees which become payable in
connection with the Merger that are required to be filed on or before the
Closing Date; and (ii) to allocate under Section 1060 of the Code all the
consideration under this Agreement provided by ATC and ATI in conformity with
the past practice of ATC and ATI and with a third-party appraisal of fixed
assets to be obtained by ATI at its sole expense.
-21-
(c) TCT shall cooperate and use its reasonable business efforts to cause
its independent accountants to reasonably cooperate with ATC in order to enable
ATC, at its sole and absolute discretion and expense, to have its independent
accountants prepare audited financial statements for TCT described in Section
6.2(g). TCT will use its reasonable business efforts to ensure that such
financial statements will have been prepared in accordance with GAAP applied on
a basis consistent with the TCT Financial Statements and will present fairly the
financial condition, results of operation and cash flow of TCT. Without limiting
the generality of the foregoing, TCT agrees that it will (i) consent to the use
of such audited financial statements in any registration, proxy or information
statement or other document filed by ATC or any of its Affiliates under the
Securities Act or the Exchange Act and (ii) execute and deliver, and cause its
officers to execute and deliver, such "representation" letters as are
customarily delivered in connection with audits and as ATC's independent
accountants may reasonably request under the circumstances.
In the event that, within forty-five (45) days of the date of this
Agreement, ATC enters into an agreement that requires it to file a registration
statement on Form S-4 under the Securities Act or commences preparation of such
a Registration Statement, ATC and TCT will enter into an amendment to this
Agreement providing, among other things, that (i) ATC shall, if permitted by the
SEC, register under the Securities Act the shares of ATC Common Stock issuable
pursuant to the consummation of the Merger, (ii) the form of TCT Investment
Letter shall be appropriately revised and the Persons from whom it is required
to be delivered shall be limited to those Persons who may be deemed to be
"affiliates" of TCT, within the meaning of the applicable rules and regulations
of the SEC under the Securities Act.
6.3 Public Announcements. Until the Closing or the termination of this
--------------------
Agreement, each party shall consult with the other before issuing any press
release or otherwise making any public statements with respect to this Agreement
or the Merger and shall not issue any such press release or make any such public
statement without the prior written approval of the other. Notwithstanding the
foregoing, the parties acknowledge and agree that they may, without each other's
prior consent, issue such press releases or make such public statements as may
be required by Applicable Law, in which case the issuing party shall use all
reasonable efforts to consult with the other party and agree upon the nature,
content and form of such press release or public statement.
6.4 Notification of Certain Matters. Each party shall give prompt notice
-------------------------------
to the other of the occurrence or non-occurrence of any Event the occurrence or
non-occurrence of which would be reasonably likely to cause (a) any
representation or warranty made by it contained in this Agreement to be untrue
or inaccurate in any material respect or (b) any failure by it to comply with or
satisfy, or be able to comply with or satisfy, in any material respect, any
covenant, condition or agreement to be complied with or satisfied by it under
this Agreement in any material respect, such that, in any such case, one or more
of the conditions of Closing would not be satisfied; provided, however, that the
delivery of any notice pursuant to this Section shall not limit or otherwise
affect the rights and remedies available hereunder to the party receiving such
notice or the obligations of the party delivering such notice and shall not, in
any event, affect the representations, warranties, covenants and agreements of
the parties or the conditions to their respective obligations under this
Agreement.
6.5 No Solicitation. Unless and until this Agreement has been terminated,
---------------
TCT shall not, and shall not permit any TCT Member to, nor shall it or any of
them knowingly permit any of its or any of their Representatives (including,
without limitation, any investment banker, financial adviser, broker, finder,
attorney, accountant or other agent or representative retained by it or any of
them) to, initiate, solicit, encourage or facilitate, or any of their
Representatives (including, without limitation, any investment banker, broker,
finder, attorney or accountant retained by it or any of them) to, initiate,
solicit or facilitate, directly
-22-
or indirectly, any inquiries or the making of any proposal with respect to any
Alternative Transaction, engage in any discussions or negotiations concerning,
or provide to any other Person any information or data relating to, it for the
purposes of, or otherwise cooperate in any way with or assist or participate in,
or facilitate any inquiries or the making of any proposal which constitutes, or
may reasonably be expected to lead to, a proposal to seek or effect any
Alternative Transaction, or agree to or endorse any Alternative Transaction. If
TCT, any TCT Member or its or any of their Representatives receives any inquiry
with respect to an Alternative Transaction while this Agreement is in effect,
TCT or such TCT Member shall inform the inquiring party that it is not entitled
to enter into discussions or negotiations relating to an Alternative
Transaction. The provisions of this Section shall apply to all Subsidiaries of
TCT other than RCC.
6.6 Conduct of Business by TCT Pending the Merger. Except as set forth in
---------------------------------------------
Section 6.6 of the TCT Disclosure Schedule or as otherwise contemplated by this
Agreement, after the date hereof and prior to the Closing Date or earlier
termination of this Agreement, unless ATC shall otherwise consent in writing,
TCT shall, and shall cause each of its Subsidiaries (other than RCC) to:
(a) conduct its business in the ordinary and usual course of business
and consistent with past practice;
(b) not (i) amend or propose to amend its Organic Documents, (ii)
split, combine or reclassify (whether by stock dividend or otherwise) its
outstanding capital stock or issue or authorize the issuance of any other
securities in respect of, in lieu of, or in substitution for shares of its
capital stock, or (iii) declare, set aside, pay or make any Distribution,
whether in cash, stock, property or otherwise;
(c) not issue, sell, pledge or dispose of, or agree to issue, sell,
pledge or dispose of, any TCT Units, other equity interests in TCT,
Convertible Securities or Option Securities;
(d) not (i) incur or become contingently liable with respect to any
Indebtedness for Money Borrowed, other than (x) borrowings, in addition to
those permitted or consented to pursuant to the provisions of clause (y)
immediately following, not to exceed the sum of (I) the principal amount of
borrowings presently outstanding and (II) $3.0 million in the aggregate
outstanding at any one time, and (y) borrowings necessary to finance
acquisitions and construction projects permitted or consented pursuant to
the provisions of paragraph (e) below, (ii) redeem, purchase, acquire or
offer or agree to redeem, purchase or acquire any of its equity interests,
including without limitation any TCT Units, other equity interests,
Convertible Securities or Option Securities, (iii) sell, lease, license,
pledge, dispose of or encumber any properties or assets or sell any
businesses other than (x) dispositions in the ordinary course of business,
(y) Liens arising in accordance with the provisions of Indebtedness for
Money Borrowed in effect on the date hereof and in accordance with their
present terms, and (z) leases of towers and shelter space to third-party
customers in the ordinary course of business and in accordance with past
practices and policies, or (iv) make any loans, advances or capital
contributions to, or investments in, any other Person, except to officers
and employees of TCT for travel, business or relocation expenses in the
ordinary course of business;
(e) not enter into or agree to enter into any Restricted Transaction
(or group of related Restricted Transactions), whether for its own account
or for any other Person, if (i) the aggregate amount reasonably expected to
be expended by TCT or any of its Subsidiaries in connection with such
individual Restricted Transaction (together with any group of related
Restricted Transactions) exceeds $3.0 million, or (ii) the aggregate amount
to be expended in connection with all Restricted Transactions (together
with any group of related Restricted Transactions) exceeds $10.0 million;
provided, however, that the foregoing restriction shall not apply to any
Restricted Transaction pursuant to agreements which are described in
Section 6.6(e) of the TCT Disclosure Schedule;
-23-
(f) use reasonable business efforts to preserve intact its business
organization and goodwill, keep available the services of its present
officers and key employees, and preserve the goodwill and business
relationships with customers and others having business relationships with
them and not engage in any action, directly or indirectly, with the intent
to adversely impact the transactions contemplated by this Agreement;
(g) confer on a regular and frequent basis with one or more
representatives of ATC to report material operational matters and the
general status of ongoing operations;
(h) not adopt, enter into, amend or terminate any employment,
severance, special pay arrangement with respect to termination of
employment or other similar arrangements or agreements with any directors,
officers or key employees without the prior approval of ATC;
(i) maintain with financially responsible insurance companies
insurance on the TCT Assets and the TCT Business in such amounts and
against such risks and losses as are consistent with past practice;
(j) not make any Tax election that could reasonably be likely to have
a material adverse effect on TCT or settle or compromise any material Tax
liability;
(k) except in the ordinary course of business or except as would not,
individually or in the aggregate, have a material adverse effect on TCT,
not modify, amend or terminate any Material Agreement to which TCT is a
party or by which any of the TCT Assets may be bound or to which any of
them may be subject or waive, release or assign any material rights or
claims thereunder;
(l) not make any material change to its accounting methods, principles
or practices, except as may be required by GAAP;
(m) not enter into any Lease or other agreement with respect to any
antennae site on any of its towers, whether presently owned or hereafter
acquired by TCT other than in the ordinary course of business and in
accordance with past practices and policies;
(n) except as set forth in Section 4.14 of the TCT Disclosure
Schedules, (i) not grant to any executive officer or other key employee of
TCT any increase in compensation, except for normal increases in the
ordinary course of business consistent with past practice or as required
under Benefit Arrangements set forth in Section 4.14 of the TCT Disclosure
Schedule, (ii) not grant to any such executive officer any increase in
severance or termination pay, except as was required under any Benefit
Arrangements set forth in Section 4.14 of the TCT Disclosure Schedule,
(iii) not adopt or, except in the ordinary course of business, amend any
Plan or Benefit Arrangement (including change any actuarial or other
assumption used to calculate funding obligations with respect to any Plan,
or change the manner in which contributions to any Plan are made or the
basis on which such contributions are determined) and (iv) except in the
ordinary course, not enter into, amend in any material respect or terminate
any Governmental Authorization, material Private Authorization or material
Contract;
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(o) not voluntarily take or permit to be taken any action which if
taken between the end of its most recent fiscal quarter and prior to the
date of this Agreement would have been required to be noted as an exception
on Section 4.16 of the TCT Disclosure Schedule, other than pursuant to the
conduct of its business in the ordinary and usual course of business and
consistent with past practice; and
(p) not authorize or enter into any agreement that would violate any
of the foregoing.
In the event that TCT or any of its Subsidiaries desires to take any of the
actions prohibited by the provisions of this Section, TCT shall give prompt
written notice to ATC, referring to the provisions of this Section. In the
event that ATC does not object to the taking of such action within ten (10)
business days of receipt of such notice and all material information requested
by ATC with respect thereto, TCT or such Subsidiary shall have the right to take
such action.
6.7 Preliminary Title Reports. As promptly as practicable after the
-------------------------
execution of this Agreement, ATC may obtain at its expense a standard
preliminary title report (the "Title Report") dated on or after the date of this
Agreement issued by such title company or companies as TCT and ATC shall
mutually reasonably agree with respect to each parcel of Real Property owned or
leased by TCT or any of its Subsidiaries (other than RCC).
6.8 Environmental Site Assessments. As promptly as practicable after the
------------------------------
execution of this Agreement, ATC may at its own cost and expense obtain, and
deliver to TCT full and complete copies of, an Environmental Report on each
parcel of Real Property owned or leased by TCT or any of its Subsidiaries for
which an Environmental Report has not heretofore been delivered by TCT to ATC
(or as to which ATC has heretofore indicated that the existing Environmental
Report raises questions of potential liability which has had or could be
reasonably expected to have a material adverse effect on TCT). Site assessments
shall be conducted by such consultants and professionals as ATC and TCT shall
mutually reasonably agree and shall be arranged at times mutually convenient to
the parties. Each of TCT and ATC shall be entitled to have representatives
present at the time such site assessments are conducted and to have copies of
all correspondence with the company preparing such Environmental Reports.
6.9 Solicitation of Employees. If this Agreement is terminated, each of
--------------------------
ATC and TCT agrees that neither it nor any of its Affiliates will, for a period
of twelve (12) months from the date of such termination, solicit or actively
seek to hire any individual who during such period is employed by ATC or any of
its Affiliates or TCT or any of its Affiliates, as the case may be, whether or
not such individual would commit breach of such individual's employment
agreement or contract in leaving such employment; provided, however, that the
foregoing shall not prevent ATC or TCT (or any of their respective Affiliates)
from soliciting or actively seeking to hire any such key employee who (i)
initiates employment discussions with it, (ii) is not employed by ATC or TCT, as
the case may be, on the date TCT or ATC (or any of their respective Affiliates),
as the case may be, first solicits such key employee, or (iii) soliciting
through general advertisement, including without limitation on the Internet.
6.10 Certificate of Non-Foreign Status. Prior to the Closing Date, TCT
---------------------------------
shall use its reasonable business efforts to obtain on behalf of itself and ATC
(in connection with potential deduction and withholding obligations under
Sections 1445 or 1446 of the Code), from each TCT Member a certificate of non-
foreign status of such member that meets the requirements of both Section
1.1445-2(b) of the Regulations and Section 5.04 of Revenue Procedure 89-31,
1989-1 C.B. 895, it being understood that the failure to obtain any such
certificates shall not be deemed to be a breach of this Section. TCT shall
furnish to ATC on the Closing Date a copy of such certificates of non-foreign
status.
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6.11 Tax Returns and Other Reports. TCT's former tax matters partner
-----------------------------
(within the meaning of Section 6231 of the Code) will prepare and file all Tax
Returns and other reports, filings, and amendments required to be filed by TCT
or delivered to the TCT members after the Effective Time, provided however that
ATC and ATI shall be provided the opportunity to review and comment upon such
reports, filings, and amendments prior to their filing or delivery. The parties
hereto agree that the Merger is being effected as a convenient mechanism to sell
TCT's assets to ATI and then liquidate TCT, and accordingly the parties will
treat the Merger for income Tax purposes as a sale by TCT of all of its assets
followed by a liquidation of TCT.
6.12 Section 754 Elections. At the request of ATC, TCT and ATC shall use
---------------------
reasonable business efforts to cooperate to cause each Subsidiary of TCT that is
identified by ATC to implement an election under Section 754 of the Code and
under comparable provisions of all state and local income Tax Laws.
ARTICLE 7
CLOSING CONDITIONS
------------------
7.1 Conditions to Obligations of Each Party. The respective obligations
---------------------------------------
of each party to consummate the Merger shall, except as hereinafter provided in
this Section, be subject to the satisfaction at or prior to the Closing Date of
the following conditions, any or all of which may be waived, in whole or in
part, to the extent permitted by Applicable Law:
(a) As of the Closing Date, no Legal Action shall be pending before
any Authority seeking to enjoin, restrain, prohibit or make illegal or to
impose any materially adverse conditions in connection with, the
consummation of the Merger, it being understood and agreed that a written
request by any Authority for information with respect to the Merger, which
information could be used in connection with such Legal Action, shall not
in itself be deemed to be a Legal Action pending before any such Authority;
(b) Any waiting period (and any extension thereof) applicable to the
consummation of the Merger under the Xxxx-Xxxxx-Xxxxxx Act shall have
expired or been terminated without any condition that has a material
adverse effect on TCT or any of its Members or any Affiliate thereof;
(c) Except with respect to the Xxxx-Xxxxx-Xxxxxx Act (which is
addressed in Section 7.1(b)), all authorizations, consents, waivers, orders
or approvals required to be obtained from all Authorities, and all filings
(other than the Certificate of Merger), submissions, registrations, notices
or declarations required to be made by any of the parties with any
Authority, prior to the consummation of the Merger, shall have been
obtained from, and made with, all such Authorities, except for such
authorizations, consents, waivers, orders, approvals, filings,
registrations, notices or declarations the failure to obtain or make would
not have a material adverse effect on TCT; and
(d) The ATC Common Stock to be issued as part of the Merger
Consideration shall have been listed for trading on The New York Stock
Exchange, subject to official notice of issuance.
7.2 Conditions to Obligations of ATC and ATI. The obligation of ATC to
----------------------------------------
cause ATI to, and of ATI to, consummate the Merger shall be subject to the
satisfaction of the following conditions, any or all of which may be waived, in
whole or in part, by ATC and ATI to the extent permitted by Applicable Law:
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(a) All agreements, certificates, opinions and other documents
required to be delivered pursuant to the provisions of this Agreement shall
be reasonably satisfactory in form, scope and substance to ATC and its
counsel, and ATC and its counsel shall have received all information and
copies of all documents, including records of corporate proceedings, which
they may reasonably request in connection therewith, such documents where
appropriate to be certified by proper Authorities or corporate officers;
(b) TCT shall have furnished ATC and, at ATC's request, any bank or
other financial institution providing credit to ATC, with one or more
favorable opinions, dated the Closing Date, of counsel for TCT, reasonably
satisfactory to ATC, covering the matters set forth in Exhibit A and made a
part hereof, and in forms and scope reasonably satisfactory to ATC, and
with respect to such other matters arising after the date of this Agreement
as ATC or its counsel may reasonably request;
(c) (i) The representations and warranties of TCT contained in this
Agreement (other than in Section 4.20) shall be true and correct at and as
of the Closing Date with the same force and effect as though made on and as
of such date, except (x) to the extent such representations and warranties
expressly speak as of an earlier date (in which case such representations
and warranties shall continue to be true and correct as of such earlier
date) and (y) to the extent that the failure of such representations and
warranties to be true and correct, individually or in the aggregate, would
not have a material adverse effect on TCT; provided, however, that for the
purpose of this clause (y), representations and warranties that are
qualified as to materiality (including by reference to "material adverse
effect") shall not be deemed to be so qualified; (ii) the representations
and warranties of TCT set forth in Section 4.20 of this Agreement shall be
true and correct; provided, however, such untruth shall be disregarded for
purposes of this Section 7.2(c) if, by adjusting the Merger Consideration
at Closing, the untruth is rendered harmless and such adjustment either
does not require the approval of the TCT Members, or such approval has been
obtained, in accordance with the DLLCA: (iii) each and all of the
agreements and covenants to be performed or satisfied by TCT or any of the
TCT stockholders hereunder at or prior to the Closing Date shall have been
duly performed or satisfied in all material respects; and (iv) TCT shall
have furnished ATC with such certificates and other documents evidencing
the truth of such representations, warranties, covenants and agreements and
the performance of such agreements or conditions as ATC or its counsel
shall have reasonably requested;
(d) Other than those which, individually or in the aggregate, the
failure of which to obtain would not have a material adverse effect on the
TCT Assets or the TCT Business taken as a whole, all authorizations,
consents, waivers, orders or approvals required by the provisions of this
Agreement to be obtained from all Persons (other than Authorities) prior to
the consummation of the Merger, including without limitation those required
in order for TCT to continue to own all of the TCT Assets and continue to
operate the TCT Business as conducted immediately prior to the Closing
(including without limitation, at the cost and expense of TCT, all
modifications, if any, of Private Authorizations, Leases and Material
Agreements of TCT set forth in Section 7.2(d) of the TCT Disclosure
Schedule) shall have been obtained, without the imposition, individually or
in the aggregate, of any condition or requirement which could have a
material adverse effect on TCT;
(e) Between the date of this Agreement and the Closing Date, there
shall not have occurred and be continuing any material adverse change in
TCT from that reflected in the most recent TCT Financial Statements;
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(f) The TCT Members and TCT shall have delivered or cause to be
delivered to ATC all of the Collateral Documents and other agreements,
documents and instruments required to be delivered by the TCT Members or
TCT to ATC at or prior to the Closing pursuant to the terms of this
Agreement;
(g) ATC shall have received a letter from its independent accountants
to the effect that an unqualified report (as to the scope of the audit,
access to the books and records and the cooperation of management) on the
financial statements (consisting of a balance sheet for the fiscal year
ended December 31, 1997, and statements of operations and cash flow for the
period ended December 31, 1997) of TCT could be prepared by them in
conformity with GAAP and Regulation S-X under the Securities Act;
(h) As of the Closing Date, except as otherwise set forth in Section
4.6(a) of the TCT Disclosure Schedule, no Legal Action shall be pending
before any Authority which could, individually or in the aggregate, have a
material adverse effect on TCT, it being understood and agreed that a
written request by any Authority for information with respect to the
Merger, which information could be used in connection with such Legal
Action, shall not be deemed to be a Legal Action pending before any such
Authority;
(i) The Environmental Reports prepared pursuant to the provisions of
Section 6.8 shall not indicate the likelihood of potential liability which
has had or could reasonably be likely to have a material adverse effect on
TCT, and no Event or Events shall have occurred subsequent to the date
hereof, which, individually or in the aggregate, would cause the
representations and warranties of TCT set forth in Section 4.19 (without
regard to knowledge) to be inaccurate or incomplete in any material
respect;
(j) ATC shall have received, at its expense, a commitment to issue
standard ALTA title insurance policies insuring TCT's or any of its
Subsidiaries' (other than RCC) leasehold or fee interest in the parcels of
land representing at least 95% of TCT net revenues on which each of its
towers is located and the improvements located thereon and the Title Report
shall not disclose any exception, other than Permitted Liens (and liens on
real property owned by other Persons as to which TCT has a ground lease),
and no Event or Events shall have occurred subsequent to the date hereof,
which, individually or in the aggregate, would cause the representations
and warranties of TCT set forth in Section 4.4 (without regard to
knowledge) to be inaccurate or incomplete in any material respect;
(k) All Convertible Securities and Option Securities of TCT, if any,
outstanding immediately prior to the Closing shall be canceled or converted
to TCT Units and, from and after the Closing, shall no longer be of any
force or effect;
(l) ATC shall have received, at its expense, a report with respect to
each of the towers of TCT and any of its Subsidiaries, of such structural
engineers as are reasonably satisfactory to ATC and TCT, that shall
indicate that towers representing at least 95% of TCT net revenues (i) are
structurally sound and in good operating condition, (ii) are in compliance
with all Applicable Laws, Governmental Authorizations, Private
Authorizations and issuance requirements, and (iii) do not require
structural or other material repairs (other than those set forth in Section
7.2(l) of the TCT Disclosure Schedule heretofore delivered to ATC) costing
more than $250,000 in the aggregate; provided, however, that to the extent
the aggregate amount of such repairs is in excess of $250,000,
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ATC shall not be entitled to terminate this Agreement but the Cash
Consideration shall be reduced by an amount equal to the excess of (x) the
aggregate amount of such repairs over (y) $250,000;
(m) Cox shall have executed and delivered to ATC an agreement
substantially in the form attached hereto as Exhibit B and made a part
hereof, amended to reflect the fact that Cox shall be entitled to one (1)
demand registration on Form S-1 under the Securities Act (the
"Registration Rights Agreement");
(n) Each TCT Member that owns Class B TCT Units shall have executed
and delivered to ATC an investment letter substantially in the form of
Exhibit C attached hereto and made a part hereof (the "TCT Investment
Letters");
(o) The Annual Tower Revenue Run Rate of TCT for the month ended
immediately prior to the Closing Date shall have been not less than
$1,050,000, increased for the period between October 31, 1998 and such
month end at an annual rate of 15%, compounded annually;
(p) Cox and each of the executive officers of TCT shall have executed
and delivered to ATC agreements substantially in the form attached hereto
as part of Exhibit D and made a part hereof (the "ATC Noncompetition
Agreements");
(q) All instruments evidencing Indebtedness for Money Borrowed of TCT
or any of its Subsidiaries shall permit the repayment thereof by ATC
without premium or penalty;
(r) Any employment agreement or other arrangement between TCT and any
of Messrs. Madigan, Sivertsen, X. Xxxxx, X. Xxxxx and Xxxxxxxx will be
terminated, at no cost to ATC or ATI, and any Contractual Obligation
between TCT and any TCT Member or any member of the Immediate Family of any
TCT Member, or any Affiliate of any of the foregoing, that is to survive
the Merger shall, to the extent requested by ATC, be amended, at no cost to
ATC or ATI, to contain terms and conditions satisfactory to ATC; and
(s) Each of the Persons named therein shall have executed and
delivered to ATC an agreement substantially in the form attached hereto as
Exhibit E and made a part hereof (the "Indemnity Escrow Agreement") and ATC
shall have been permitted to make the deposits contemplated thereby.
7.3 Conditions to Obligations of TCT. The obligation of TCT to consummate
--------------------------------
the Merger shall be subject to the satisfaction of the following conditions, any
or all of which may be waived, in whole or in part, by TCT to the extent
permitted by Applicable Law:
(a) All agreements, certificates, opinions and other documents
required to be delivered pursuant to the provisions of this Agreement shall
be reasonably satisfactory in form, scope and substance to TCT and its
counsel, and TCT and its counsel shall have received all information and
copies of all documents, including records of corporate proceedings, which
they may reasonably request in connection therewith, such documents where
appropriate to be certified by proper Authorities or corporate officers;
(b) ATC shall have furnished TCT, with favorable opinions, dated the
Closing Date, of Xxxxxxxx & Worcester LLP, counsel for ATC, substantially
in the form attached hereto as Exhibit F
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and made a part hereof, and with respect to such other matters arising
after the date of this Agreement as TCT or its counsel may reasonably
request;
(c) (i) The representations and warranties of ATC and ATI contained in
this Agreement (other than in Section 5.5) shall be true and correct at and
as of the Closing Date with the same force and effect as though made on and
as of such date, except (x) to the extent such representations and
warranties expressly speak as of an earlier date (in which case such
representations and warranties shall be true and correct as of such earlier
date) and (y) to the extent that the failure of such representations and
warranties to be true and correct, individually or in the aggregate, would
not have a material adverse effect on ATC; provided, however, that for the
purpose of this clause (y), representations and warranties that are
qualified as to materiality (including by reference to "material adverse
effect") shall not be deemed to be so qualified; (ii) the representations
and warranties of ATC set forth in Section 5.5 of this Agreement shall be
true and correct; provided, however, such untruth shall be disregarded for
purposes of this Section 7.3(c) if, by adjusting the Merger Consideration
at Closing, the untruth is rendered harmless and such adjustment either
does not require the approval of the ATC or ATI stockholders, or such
approval has been obtained, in accordance with the DCL; (iii) each and all
of the agreements and covenants to be performed or satisfied by ATC or ATI
hereunder at or prior to the Closing Date shall have been duly performed or
satisfied in all material respects; and (iv) ATC and ATI shall have
furnished TCT with such certificates and other documents evidencing the
truth of such representations, warranties, covenants and agreements and the
performance of such agreements or conditions as TCT or its counsel shall
have reasonably requested;
(d) ATC and ATI shall have delivered or cause to be delivered to TCT
all of the Collateral Documents and other agreements, documents and
instruments required to be delivered by ATC and ATI to TCT at or prior to
the Closing pursuant to the terms of this Agreement;
(e) Between the date of this Agreement and the Closing Date, there
shall not have occurred and be continuing any material adverse change in
ATC from that reflected in the most recent ATC Financial Statements;
(f) As of the Closing Date, no Legal Action shall be pending before
any Authority which could, individually or in the aggregate, be reasonably
expected to have a material adverse effect on ATC, it being understood and
agreed that a written request by any Authority for information with respect
to the Merger, which information could be used in connection with such
Legal Action, shall not be deemed to be a Legal Action pending before any
such Authority;
(g) ATC shall have executed and delivered the Registration Rights
Agreement and permitted Cox and such other TCT Members as so request, in
their sole and absolute discretion, to become signatories thereto;
(h) ATC shall have delivered to Cox an agreement substantially in the
form of Exhibit G attached hereto and made a part hereof (the "ATC Voting
Agreement") executed by the ATC stockholders named therein and any
individual nominated pursuant thereto shall have been elected a director of
ATC; and
(i) ATC shall have executed and delivered to TCT the Indemnity Escrow
Agreement.
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ARTICLE 8
TERMINATION, AMENDMENT AND WAIVER
---------------------------------
8.1 Termination. This Agreement may be terminated at any time prior to
-----------
the Effective Time only pursuant to the following provisions:
(a) by mutual consent of TCT and ATC; or
(b) by ATC or TCT if any permanent injunction, decree or judgment of
any Authority preventing consummation of the Merger shall have become final
and nonappealable; or
(c) by TCT in the event (i) TCT is not in material breach of this
Agreement and none of its representations or warranties shall have become
and continue to be untrue in any manner that would cause the condition set
forth in Section 7.2(c) not to be satisfied, and (ii) either (A) the Merger
has not been consummated on or prior to June 30, 1999, or (B) ATC or ATI is
in material breach of this Agreement or any of its representations or
warranties shall have been or become and continue to be untrue in any
manner that would cause the conditions set forth in Section 7.3(c) not to
be satisfied, and such a breach or untruth exists and is not capable of
being cured by and will prevent or delay consummation of the Merger by or
beyond June 30, 1999; or
(d) by ATC in the event (i) neither ATC nor ATI is in material breach
of this Agreement and none of its representations or warranties shall have
become and continue to be untrue in any manner that would cause the
condition set forth in Section 7.3(c) not to be satisfied, and (ii) either
(A) the Merger has not been consummated on or prior to June 30, 1999, or
(B) TCT is in material breach of this Agreement or any of TCT's
representations or warranties shall have been or become and continue to be
untrue in any manner that would cause the conditions set forth in Section
7.2(c) not to be satisfied, and such a breach or untruth exists and is not
capable of being cured by and will prevent or delay consummation of the
Merger by or beyond June 30, 1999; or
(e) by ATC or TCT in the event the Merger has not been consummated on
or prior to the Termination Date.
The term "Termination Date" shall mean September 30, 1999 or such other
date as the parties may, from time to time, mutually agree.
The right of ATC or TCT to terminate this Agreement pursuant to this
Section shall remain operative and in full force and effect regardless of any
investigation made by or on behalf of any party, any Person controlling any such
party or any of their respective Representatives whether prior to or after the
execution of this Agreement.
8.2 Effect of Termination. Except as provided in Sections 6.1 (with
---------------------
respect to confidentiality), 6.3 and 10.2 and this Section, in the event of the
termination of this Agreement pursuant to Section 8.1, this Agreement shall
forthwith become void, there shall be no liability on the part of any party, or
any of their respective stockholders, officers or directors, to the other and
all rights and obligations of any party shall cease; provided, however, that
such termination (including without limitation any termination pursuant to the
provisions of Section 8.1(e)) shall not relieve any party from liability for any
willful or intentional misrepresentation or breach of any of its warranties,
covenants or agreements set forth in this Agreement. In the event this Agreement
is terminated by either party pursuant to Section 8.1 (c) or 8.1(d) because of
the
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intentional or wilful breach of covenant or agreement of the other party
(including without limitation the refusal of the other party to consummate the
Merger notwithstanding the fact that all of its conditions to do so have been
satisfied), the terminating party shall be entitled to liquidated damages in the
amount of $10,000,000, it being agreed that such amount shall constitute full
payment for any and all damages suffered by the nondefaulting party by reason of
such intentional or wilful breach of covenant or agreement. ATC and TCT agree
in advance that actual damages would be difficult to ascertain and that
$10,000,000 is a fair and equitable amount to reimburse TCT or ATC, as the case
may be, for damages sustained due to ATC's or TCT's failure to consummate the
Merger for the reasons specified in the immediately preceding sentence.
Notwithstanding the foregoing, the liquidated damages provisions set forth
herein are not exclusive remedies and each party shall have the right, in its
sole and absolute discretion, to seek specific performance of this Agreement
pursuant to the provisions of Section 10.4. Anything in this Agreement to the
contrary notwithstanding, although a party may have multiple reasons for
terminating this Agreement, it shall not be entitled to collect liquidated or
other damages more than once.
ARTICLE 9
INDEMNIFICATION
---------------
9.1 Survival. The representations and warranties of the parties contained
--------
in or made pursuant to this Agreement or any Collateral Document shall survive
the Closing and shall remain operative and in full force and effect for a period
of twelve (12) months after the Closing Date, except that in the case of matters
of a nature referred to in Sections 4.1, 4.20, 5.1 and 5.5 which shall survive
and remain operative and in full force and effect for a period of twenty-four
(24) months after the Closing Date, regardless of any investigation or statement
as to the results thereof made by or on behalf of any party hereto. The
covenants and agreements of the parties contained in or made pursuant to this
Agreement or any Collateral Document shall survive the Closing (unless any such
covenant or agreement by its express terms in this Agreement does not so
survive) and shall remain operative and in full force and effect for the statute
of limitations applicable to contractual obligations. The term "Indemnity
Period" shall mean the applicable period with respect to which a representation,
warranty, covenant or agreement survives the Closing as provided in this
Section. No claim for indemnification, other than with respect to fraud may be
asserted after the expiration of the Indemnity Period. Notwithstanding anything
herein to the contrary, any representation, warranty, covenant and agreement
which arises and is the subject of a Claim which is asserted in writing prior to
the expiration of the applicable Indemnity Period shall survive with respect to
such Claim or any dispute with respect thereto until the final resolution
thereof.
9.2 Indemnification.
---------------
(a) TCT agrees, with respect to the extent of each TCT Member's interest in
the Escrow Indemnity Funds on behalf of each TCT Member, to the extent provided
in this Article 9, including without limitation Section 9.3, that on and after
the Closing ATC and ATI and their respective stockholders, directors, officers,
employees, agents and representatives (collectively, the "ATC Indemnified
Parties") shall be indemnified and held harmless from and against any and all
damages, claims, losses, expenses, costs, obligations, and liabilities
including, without limiting the generality of the foregoing, liabilities for all
reasonable attorneys', accountants' and experts' fees and expenses incurred,
including those incurred to enforce the terms of this Agreement or any
Collateral Document (collectively, "Loss and Expense"), suffered by the ATC
Indemnified Parties by reason of or arising out of (i) any breach of
representation or warranty made by TCT pursuant to this Agreement or any
Collateral Document, and (ii) any failure by TCT to perform or fulfill any of
its covenants or agreements set forth in this Agreement or any Collateral
Document.
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(b) ATC and ATI, jointly and severally, agree that on and after the Closing
they will indemnify each former TCT Member and hold it harmless from and against
all Loss and Expense suffered by any of them by reason of or arising out of (i)
any breach of representation or warranty made by ATC or ATI pursuant to this
Agreement or any Collateral Document, and (ii) any failure by ATC or ATI to
perform or fulfill any of its covenants or agreements set forth in this
Agreement or any Collateral Document.
9.3 Limitation of Liability.
-----------------------
(a) Notwithstanding the provisions of Section 9.2, after the Closing, the
ATC Indemnified Parties, on the one hand, and the TCT Members, on the other
hand, shall be entitled to recover their Loss and Expense in respect of any
Claim only (i) in the event that the aggregate Loss and Expense for all Claims
exceed, in the aggregate, $500,000, in which event the indemnified party shall
be entitled to recover all such Loss and Expense including such $500,000; and
(ii) to the extent that the aggregate Loss and Expense for all Claims do not
exceed $5,000,000.
(b) Anything in this Agreement, including without limitation the provisions
of Sections 9.2 or 9.3(a), to the contrary notwithstanding, except as provided
in Section 9.6, (i) the exclusive recourse of ATC and ATI after the Closing with
respect to the liability of the TCT Members pursuant to Section 9.2 or any other
provision of this Agreement or Applicable Law which requires the TCT Members to
defend, indemnify or hold harmless ATC or ATI from or against any Claim or Loss
and Expense shall be the Escrow Indemnity Funds (as defined in the Indemnity
Escrow Agreement); and (ii) ATC's and ATI's remedies for any such liability of
any TCT Member, or for any Claim arising under this Agreement, shall be limited
to its right to recover from the Escrow Indemnity Funds in accordance with the
provisions of the Indemnity Escrow Agreement, and neither ATC nor ATI nor any of
either of their officers, directors, shareholders, agents or Affiliates shall
have any right of recovery against any TCT Member or any of its officers,
directors, shareholders, agents or Affiliates or against the assets of any of
them for any such liability.
(c) In the case any event shall occur which would otherwise entitle any
party to assert a claim for indemnification hereunder, no Loss and Expense shall
be deemed to have been sustained by such party to the extent of any proceeds
received by such party from any insurance policies with respect thereto.
9.4 Notice of Claims. If an indemnified party believes that it has
----------------
suffered or incurred any Loss and Expense, it shall notify the indemnifying
party promptly in writing, and in any event within the applicable Indemnity
Period specified in Section 9.1, describing such Loss and Expense, all with
reasonable particularity and containing a reference to the provisions of this
Agreement in respect of which such Loss and Expense shall have occurred. If any
Legal Action is instituted by a third party with respect to which an indemnified
party intends to claim any liability or expense as Loss and Expense under this
Article, such indemnified party shall promptly notify the indemnifying party of
such Legal Action, but the failure to so notify the indemnifying party shall not
relieve such indemnifying party of its obligations under this Article, except to
the extent such failure to notify prejudices such indemnifying party's ability
to defend against such Claim.
9.5 Defense of Third Party Claims. The indemnifying party shall have the
-----------------------------
right to conduct and control, through counsel of its own choosing, reasonably
acceptable to the indemnified party, any third party Legal Action or other
Claim, but the indemnified party may, at its election, participate in the
defense thereof at its sole cost and expense; provided, however, that if the
indemnifying party shall fail to defend any such Legal Action or other Claim,
then the indemnified party may defend, through counsel of its own choosing, such
Legal Action or other Claim, and (so long as it gives the indemnifying party at
least fifteen (15) days'
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notice of the terms of the proposed settlement thereof and permits the
indemnifying party to then undertake the defense thereof) settle such Legal
Action or other Claim and to recover 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 such Legal Action or other Claim
without the prior written consent of the indemnified party, which consent shall
not unreasonably be withheld, delayed or conditioned if the terms and conditions
of such compromise or settlement proposed by the indemnifying party and agreed
to in writing by the claimant in such Legal Action or other Claim (a) include a
full release of the indemnified party from the Legal Action or other Claim which
is the subject of the Settlement Proposal, and (b) if the indemnified party is
an ATC Indemnified Party, do not include any term or condition which would
restrict in any material manner the continued ownership or operations of the TCT
Assets or the conduct of the TCT Business in substantially the manner then being
owned, operated and conducted by ATI (or any successor or assign). No matter
whether an indemnifying party defends or prosecutes any third party Legal Action
or Claim, the indemnified and indemnifying parties shall cooperate in the
defense or prosecution thereof. Such cooperation shall include access during
normal business hours afforded to the indemnifying party to, and reasonable
retention by the indemnified party of, records and information which are
reasonably relevant to such third party Legal Action or Claim, and making
employees available on a mutually convenient basis to provide additional
information and explanation of any material provided hereunder, and the
indemnifying party shall reimburse the indemnified party for all its reasonable
out-of-pocket expenses in connection therewith.
9.6 Exclusive Remedy. Except for fraud, the indemnification provided in
----------------
this Article shall be the sole and exclusive post-Closing remedy available to
any party against any other party for any Claim under this Agreement.
9.7 Indemnification of Directors and Officers.
-----------------------------------------
(a) From and after the Effective Time, ATC and Surviving Corporation shall,
jointly and severally, indemnify, defend and hold harmless the present and
former officers, Management Committee representatives and employees of TCT and
any of its Subsidiaries, and any Person who is or was serving at the request of
TCT as an officer, director or employee or agent of another Person, against all
losses, expenses, claims, damages or liabilities arising out of actions or
omissions occurring on or prior to the Effective Time (including the
transactions contemplated by this Agreement) to the fullest extent permitted
under Applicable Law (and shall also, subject to the provisions of Section
9.7(d), advance expenses as incurred to the fullest extent permitted under
Applicable Law; provided, however, that the Person to whom expenses are advanced
provides an undertaking, reasonably satisfactory in form, scope and substance to
ATC, to repay such advances if it is ultimately determined that such Person is
not entitled to indemnification); and provided further, however, that such
indemnification shall be provided only to the extent any directors' and
officers' liability insurance policy of ATC or its Subsidiaries does not provide
coverage and actual payment thereunder with respect to the matters that would
otherwise be subject to indemnification hereunder (it being understood that ATC
or the Surviving Corporation shall, subject to the provisions of Section 9.7(d),
advance expenses on a current basis as provided in this Section notwithstanding
such insurance coverage to the extent that payments thereunder have not yet been
made, in which case ATC or the Surviving Corporation, as the case may be, shall
be entitled to repayment of such advances from the proceeds of such insurance
coverage).
(b) ATC and ATI agree that all rights to indemnification, including
provisions relating to advances of expenses incurred in defense of any Claim,
existing in favor of the present or former Management Committee representatives,
directors, officers, employees, fiduciaries and agents of TCT or any of its
Subsidiaries, and any Person who is or was serving at the request of TCT as an
officer, director or employee
-34-
or agent (collectively, the "Indemnified Parties") as provided in the Amended
and Restated Operating Agreement of TCT or pursuant to other agreements, or
certificates of incorporation or by-laws or similar documents of any of TCT's
Subsidiaries, as in effect as of the date hereof, with respect to matters
occurring through the Effective Time, shall survive the Merger and shall
continue in full force and effect for a period of not less than six years from
the Effective Time; provided, however, that all rights to indemnification in
respect of any Claim asserted, made or commenced within such period shall
continue until the final disposition of such Claim.
(c) ATC shall maintain in effect for not less than six years after the
Effective Time the current policies of directors' and officers' liability
insurance maintained by TCT and its Subsidiaries with respect to matters
occurring prior to the Effective Time; provided, however, that (i) ATC may
substitute therefor policies of at least the same coverage containing terms and
conditions which are not materially less advantageous to the Indemnified Parties
with an insurance company or companies, the claims paving ability of which is
substantially equivalent to the claims paying ability of the insurance company
or companies providing such insurance coverage for directors and officers of ATC
and (ii) ATC shall not be required to pay an annual premium for such insurance
in excess of two (2) times the last annual premium paid prior to the date
hereof, but in such case shall purchase as much coverage as possible for such
amount.
(d) In the event that any Claim relating hereto or to the transactions
contemplated by this Agreement is commenced, before the Effective Time, the
parties hereto agree to cooperate and use their respective reasonable efforts to
vigorously defend against and respond thereto. Any Indemnified Party wishing to
claim indemnification under Section 9.7(a) upon learning of any such claim,
action, suit, proceeding or investigation, shall promptly notify ATC thereof,
whereupon ATC or the Surviving Corporation shall have the right, from and after
the Effective Time, to assume and control the defense thereof, and upon such
assumption, neither ATC nor the Surviving Corporation shall be liable to such
Indemnified Parties for any legal expenses of other counsel or any other
expenses subsequently incurred by such Indemnified Parties in connection with
the defense thereof. Neither ATC nor the Surviving Corporation shall be liable
for any settlement effected without its prior written consent.
(e) This Section 9.7 is intended to benefit the Indemnified Parties and
shall be binding on all successors and assigns of ATC and the Surviving
Corporation.
ARTICLE 10
GENERAL PROVISIONS
------------------
10.1 Waivers; Amendments. Changes in or additions to this Agreement may be
-------------------
made, or compli ance with any term, covenant, agreement, condition or provision
set forth herein may be omitted or waived (either generally or in a particular
instance and either retroactively or prospectively) with, but only with, the
consent in writing of the parties hereto. No delay on the part of either party
at any time or times in the exercise of any right or remedy shall operate as a
waiver thereof. Any consent may be given subject to satisfaction of conditions
stated therein. The failure to insist upon the strict provisions of any
covenant, term, condition or other provision of this Agreement or to exercise
any right or remedy hereunder shall not constitute a waiver of any such
covenant, term, condition or other provision thereof or default in connection
therewith. The waiver of any covenant, term, condition or other provision
hereof or default hereunder shall not affect or alter this Agreement in any
other respect, and each and every covenant, term, condition or other
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provision of this Agreement shall, in such event, continue in full force and
effect, except as so waived, and shall be operative with respect to any other
then existing or subsequent default in connection herewith.
10.2 Fees, Expenses and Other Payments. All transfer Taxes, sales Taxes,
---------------------------------
recording or documentary Taxes, stamps or other charges levied by any Authority
in connection with this Agreement and the consummation of the Merger as well as
all costs and expenses in connection with such Taxes, stamps or other charges
shall be borne equally by the TCT Members and ATC, all costs referred to in
Sections 6.7, 6.8 and 7.2(j) shall be borne by ATC, all Xxxx-Xxxxx-Xxxxxx filing
fees and expenses shall be borne equally by TCT and ATC, and all other costs and
expenses incurred in connection with this Agreement and the consummation of the
Merger, including without limitation fees and disbursements of counsel,
financial advisors and accountants incurred by the parties hereto, shall, unless
otherwise provided herein, be borne solely and entirely by the party which has
incurred such costs and expenses.
10.3 Notices. All notices and other communications which by any provision
-------
of this Agreement are required or permitted to be given shall be given in
writing and shall be deemed to have been delivered (a) three (3) business days
after being mailed by first-class or express mail, postage prepaid, (b) the next
day when sent overnight by recognized courier service, (c) upon confirmation
when sent by telex, telegram, telecopy or other form of rapid transmission,
confirmed by mailing (by first class or express mail, postage prepaid, or by
recognized courier service) written confirmation at substantially the same time
as such rapid transmission, or (d) upon delivery when personally delivered to
the receiving party (which if other than an individual shall be an officer or
other responsible party of the receiving party). All such notices and
communications shall be mailed, sent or delivered as follows:
(a) If to ATC or ATI:
000 Xxxxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxx, Chief Financial Officer
Telecopier No.: (000) 000-0000
with a copy to (which shall not constitute notice to ATC or ATI):
Xxxxxxxx & Worcester LLP
Xxx Xxxx Xxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxx, Esq.
Telecopier No.: (000) 000-0000
(b) If to TCT:
0000 Xxxxxx Xxxx.
Xxxxx 000
Xxxxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxx
Telecopier No.: (000) 000-0000
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with copies to (which shall not constitute notice to TCT or any TCT
Member):
Cox TeleCom Towers, Inc.
0000 Xxxx Xxxxx Xx. X.X.
Xxxxxxx, XX 00000
Attention: Xxxx Xxxxxx
Telecopier No.: (000) 000-0000
Dow, Xxxxxx & Xxxxxxxxx, PLLC
0000 Xxx Xxxxxxxxx Xxxxxx
Xxxxx 000
Xxxxxxxxxx, XX 00000
Attention: Xxxxxx X. Xxxxxxx, Esq.
Telecopier No.: (000) 000-0000
Cameron & Xxxxxxxxx
00 Xxxxxxxx Xxxxxxx
Xxxxxxxxxx, XX 00000
Attention: Xxxxx X. Xxxxx, Esq.
Telecopier No.: (000) 000-0000
or to such other person(s), telex or facsimile number(s) or address(es) as the
party to receive any such communication or notice may have designated by written
notice to the other party.
10.4 Specific Performance; Other Rights and Remedies. Each party
-----------------------------------------------
recognizes and agrees that in the event the other party should refuse to perform
any of its obligations under this Agreement or any Collateral Document, the
remedy at law would be inadequate and agrees that for breach of such provisions,
each party shall, in addition to such other remedies as may be available to it
at law or in equity or as provided in Article 10, be entitled to injunctive
relief and to enforce its rights by an action for specific performance to the
extent permitted by Applicable Law. Each party hereby waives any requirement
for security or the posting of any bond or other surety in connection with any
temporary or permanent award of injunctive, mandatory or other equitable relief.
Subject to the provisions of Section 9.3, nothing herein contained shall be
construed as prohibiting any party from pursuing any other remedies available to
it pursuant to the provisions of this Agreement or Applicable Law for such
breach or threatened breach, including without limitation the recovery of
damages; provided, however, that none of the parties shall pursue, and each
party hereby waives, any punitive, incidental and consequential damages arising
out of this Agreement (including without limitation damages for diminution in
value and loss of anticipated profits).
10.5 Severability. If any term or provision of this Agreement shall be
------------
held or deemed to be, or shall in fact be, invalid, inoperative, illegal or
unenforceable as applied to any particular case in any jurisdiction or
jurisdictions, or in all jurisdictions or in all cases, because of the
conflicting of any provision with any constitution or statute or rule of public
policy or for any other reason, such circumstance shall not have the effect of
rendering the provision or provisions in question invalid, inoperative, illegal
or unenforceable in any other jurisdiction or in any other case or circumstance
or of rendering any other provision or provisions herein contained invalid,
inoperative, illegal or unenforceable to the extent that such other provisions
are not themselves actually in conflict with such constitution, statute or rule
of public policy, but this Agreement shall be reformed and construed in any such
jurisdiction or case as if such invalid, inoperative, illegal or unenforceable
provision had never been contained herein and such provision reformed so that it
would be valid, operative and enforceable to the maximum extent permitted in
such jurisdiction or in such case. Notwithstanding the foregoing, in the event
of any such determination the effect of which is to affect materially and
adversely any party, 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 to the fullest extent permitted by Applicable Law in an acceptable
manner to the end that the Transactions are fulfilled and consummated to the
maximum extent possible.
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10.6 Counterparts. This Agreement may be executed in several
------------
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument, binding upon all of the
parties. In pleading or proving any provision of this Agreement, it shall not be
necessary to produce more than one set of such counterparts.
10.7 Section Headings. The headings contained in this Agreement are for
----------------
reference purposes only and shall not in any way affect the meaning or
interpretation of this Agreement.
10.8 Governing Law; Venue. The validity, interpretation, construction and
--------------------
performance of this Agreement shall be governed by, and construed in accordance
with, the applicable laws of the United States of America and the laws of State
of New York applicable to contracts made and performed in such State and, in any
event, without giving effect to any choice or conflict of laws provision or rule
that would cause the application of domestic substantive laws of any other
jurisdiction, except to the extent the DCL or the DLLCA applies to the Merger.
Anything in this Agreement to the contrary notwithstanding, in the event of any
dispute between the parties which results in a Legal Action, the prevailing
party shall be entitled to receive from the non-prevailing party reimbursement
for reasonable legal fees and expenses incurred by such prevailing party in such
Legal Action. In the event of any Legal Action between the parties arising out
of this Agreement, the parties agree to submit the matter to the Delaware
Chancery Court, and the parties agree to submit to the jurisdiction of such
court.
10.9 Further Acts. Each party agrees that at any time, and from time to
------------
time, before and after the consummation of the transactions contemplated by this
Agreement, it will do all such things and execute and deliver all such
Collateral Documents and other assurances, as any other party or its counsel
reasonably deems necessary or desirable in order to carry out the terms and
conditions of this Agreement and the transactions contemplated hereby or to
facilitate the enjoyment of any of the rights created hereby or to be created
hereunder.
10.10 Entire Agreement. This Agreement (together with the TCT Disclosure
----------------
Schedule, the Exhibits the other Collateral Documents, and the other documents
delivered or to be delivered in connection herewith) constitutes the entire
agreement of the parties with respect to the subject matter hereof and
supersedes all prior agreements, arrangements, covenants, promises, conditions,
undertakings, inducements, representations, warranties and negotiations,
expressed or implied, oral or written, between the parties, with respect to the
subject matter hereof, including without limitation any previously executed
confidentiality agreements and letters of intent. Each of the parties is a
sophisticated Person that was advised by experienced counsel and, to the extent
it deemed necessary, other advisors in connection with this Agreement. Each of
the parties hereby acknowledges that (a) none of the parties has relied or will
rely in respect of this Agreement or the transactions contemplated hereby upon
any document or written or oral information previously furnished to or
discovered by it or its representatives, other than this Agreement (or such of
the foregoing as are delivered at the Closing), (b) there are no covenants or
agreements by or on behalf of any party or any of its respective Affiliates or
representatives other than those expressly set forth in this Agreement and the
Collateral Documents, and (c) the parties' respective rights and obligations
with respect to this Agreement and the events giving rise thereto will be solely
as set forth in this Agreement and the Collateral Documents. WITHOUT LIMITING
THE GENERALITY OF THE FOREGOING, EACH PARTY HERETO AGREES THAT, EXCEPT FOR THE
REPRESENTATIONS AND WARRANTIES CONTAINED IN THIS AGREEMENT AND ANY COLLATERAL
DOCUMENT, NONE OF THE PARTIES MAKES ANY OTHER REPRESENTATIONS OR WARRANTIES, AND
EACH HEREBY
-38-
DISCLAIMS ANY OTHER REPRESENTATIONS OR WARRANTIES MADE BY ITSELF OR ANY OF ITS
OFFICERS, DIRECTORS, EMPLOYEES, AGENTS, FINANCIAL AND LEGAL ADVISORS OR OTHER
REPRESENTATIVES, WITH RESPECT TO THE EXECUTION AND DELIVERY OF THIS AGREEMENT OR
THE TRANSACTIONS CONTEMPLATED HEREBY, NOTWITHSTANDING THE DELIVERY OR DISCLOSURE
TO THE OTHER OR THE OTHER'S REPRESENTATIVES OF ANY DOCUMENTATION OR OTHER
INFORMATION WITH RESPECT TO ANY ONE OR MORE OF THE FOREGOING.
10.11 Assignment. This Agreement shall not be assignable by any party and
----------
any such assignment shall be null and void, except that it shall inure to the
benefit of and be binding upon any successor to any party by operation of law,
including by way of merger, consolidation or sale of all or substantially all of
its assets, and ATC may assign its rights and remedies hereunder to any bank or
other financial institution which has loaned funds or otherwise extended credit
to it.
10.12 Parties in Interest. This Agreement shall be binding upon and inure
-------------------
solely to the benefit of each party, and nothing in this Agreement, express or
implied, is intended to or shall confer upon any Person any right, benefit or
remedy of any nature whatsoever under or by reason of this Agreement, except as
otherwise provided in Section 10.11.
10.13 Mutual Drafting. This Agreement is the result of the joint efforts
---------------
of TCT and ATC, and each provision hereof has been subject to the mutual
consultation, negotiation and agreement of the parties and there shall be no
construction against any party based on any presumption of that party's
involvement in the drafting thereof.
10.14 TCT Disclosure Schedule. TCT will deliver to ATC, within fifteen
-----------------------
(15) business days of the date of this Agreement, the TCT Disclosure Schedule
and all other documents required to be delivered by TCT pursuant to Article 4 of
this Agreement. Without limiting the generality of the foregoing, the TCT
Disclosure Schedule shall set forth TCT's proposal with respect to which
modifications, if any, of Private Authorizations, Leases and Material Agreements
are proposed to be a condition to Closing pursuant to the provisions of Section
7.2(d). ATC shall have the right, for a period commencing upon its receipt of
the TCT Disclosure Schedule and each other document together with a letter from
TCT indicating that such delivery constitutes a "final and complete" delivery
pursuant to this Section and terminating at 11:59 p.m. on the tenth (10th)
business day following such receipt, (a) to terminate this Agreement, if the TCT
Disclosure Schedule reveals any Event of which ATC was unaware as of the date of
this Agreement, which unknown Events, individually or in the aggregate, would
have a material adverse effect on TCT, and (b) to propose to TCT alternatives as
to which Private Authorizations, Leases and Material Agreements and which
modifications, if any, of Leases and Material Agreements are to be a condition
to Closing pursuant to the provisions of Section 7.2(d). In the event TCT does
not agree to any proposal of ATC pursuant to clause (b) of the prior sentence,
TCT and ATC shall be obligated to negotiate in good faith with respect to
resolving such matters. In the event ATC and TCT do not agree in writing on the
resolution of matters raised by any proposal made by ATC pursuant to such clause
(b) on or prior to ten (10) business days of receipt by TCT of any such proposal
of ATC (the "Interim Period") either party may, on or prior to ten (10) business
days (the "Termination Period"), following the expiration of the Interim Period,
terminate this Agreement. In the event neither party shall have so terminated
this Agreement on or prior to the expiration of the Termination Period, or, in
the event ATC makes no proposal pursuant to clause (b) of the preceding
paragraph, this Agreement shall continue in full force and effect and the
original proposal of TCT (as set forth in Section 7.2(d) of the TCT Disclosure
Schedule) shall control for purposes of determining the conditions of Closing
set forth in Section 7.2(d). The disclosures in the TCT Disclosure Schedule are
to be taken as relating to all of the representations and warranties of TCT. The
disclosure of a particular item in the TCT Disclosure
-39-
Schedule shall not be construed as an admission by TCT that such matter falls
within the scope of any applicable materiality or other qualifications or
limitations, or that such matter has had or is reasonably likely to have a
material adverse effect. In addition, to the extent the TCT Disclosure Schedule
includes matters that are not required by this Agreement to be reflected on such
TCT Disclosure Schedule, such additional matters are set forth for information
purposes only and shall be construed as expanding the scope of any
representations, warranties or covenants of TCT hereunder. Any reference in the
TCT Disclosure Schedule to a contract, agreement, instrument, document, order,
decree or judgment shall be deemed to include a reference to all amendments and
modifications thereof, if any, so long as such amendments and modifications are
made available to ATC as part of its due diligence investigation. In the event
either party terminates this Agreement pursuant to the provisions of this
Section, neither party shall have any liability to the other. The rights of ATC
in this Section are in addition to those set forth in Section 10.15.
10.15 ATC's Due Diligence. On or prior to the fifteenth (15th) business
-------------------
day following the date of this Agreement, ATC shall have completed its due
diligence investigation of TCT and the TCT Assets and the TCT Business. ATC
shall have the right, at any time prior to 11:59 p.m. on the fifteenth (15th)
business day following the date of this Agreement to terminate this Agreement if
such investigation reveals any Event of which ATC was unaware as of the date of
this Agreement, which unknown Events, individually or in the aggregate, would
have a material adverse effect on TCT. Without limiting the generality of the
foregoing, ATC shall have been satisfied as a consequence of such due diligence
that (a) TCT and each of its Subsidiaries has at all times been classified as a
partnership under the Code, and that neither TCT nor any of its Subsidiaries has
ever been a publicly traded partnership treated as a corporation under Section
7704 of the Code, and (b) consummation of the Merger will not, either alone or
upon the occurrence of any additional or subsequent Event, result in TCT or ATC
or any of either of their Subsidiaries being subject to any additional Taxes
(other than Taxes of a nature referred to in Section 10.2) which, individually
or in the aggregate, exceed $250,000, it being the intent of the parties that
they would each bear fifty percent (50%) of such additional Taxes up to an
aggregate of $125,000 each and that in the event such additional Taxes exceed
$250,000 the parties shall negotiate in good faith how such excess shall be
borne and, in the event they are unable to agree within a reasonable period of
time, either party may terminate this Agreement without any liability of either
party. Whether or not such additional Taxes may aggregate more than $250,000,
ATC shall have the right to revise the form of this transaction, in its sole and
absolute discretion, to one in which a newly organized Subsidiary of ATC (or one
of its Subsidiaries) merges into TCT and, in such event, TCT agrees to execute
an appropriate amendment to this Agreement, so long as the execution of such
amendment does not result in additional Taxes to TCT or the TCT Members in an
aggregate amount in excess of $100,000. In the event ATC terminates this
Agreement pursuant to the provisions of this Section, neither party shall have
any liability to the other. The rights of ATC in this Section are in addition to
those set forth in Section 10.14.
[SIGNATURES APPEAR ON FOLLOWING PAGE]
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IN WITNESS WHEREOF, the parties have executed this Agreement or caused this
Agreement to be executed by their respective officers thereunto duly authorized
as of the date first written above.
American Tower Corporation
By: ____________________________________
Name:
Title:
American Towers, Inc.
By: _____________________________________
Name:
Title:
TeleCom Towers, L.L.C.
By: ______________________________________
Name:
Title:
-41-
APPENDIX A
DEFINITIONS
ADJUSTMENT HOLDBACK shall have the meaning given to it in Section 3.4.
ADVERSE, ADVERSELY, when used alone or in conjunction with other terms
(including without limitation "affect," "change" and "effect") shall mean any
Event which is reasonably likely, in the reasonable business judgment of the
relevant party, to be expected to (a) adversely affect the validity or
enforceability of this Agreement or the likelihood of consummation of the
Merger, or (b) adversely affect the business, operations, management, or
properties, or the financial condition, or results of operation of the TCT
Assets or the TCT Business or ATC and its Subsidiaries, taken as a whole, as
applicable, or (c) impair such party's ability to fulfill its obligations under
the terms of this Agreement, or (d) adversely affect the aggregate rights and
remedies of such party under this Agreement. Notwithstanding the foregoing, and
anything in this Agreement to the contrary notwithstanding, the following events
shall not be deemed to constitute such a change, affect or effect: (i) changes
in the financial markets or general economic conditions and Events affecting the
communications sites industry generally, including without limitation conditions
or changes which affect the prevailing interest rates available to businesses
involved in the communications sites industry or which affect the prevailing
resale valuation or the method of determining such valuations of the businesses
involved in the communications sites industry, and (ii) the resignation or
retirement of any TCT employee or group of TCT employees because of the
execution and delivery of this Agreement.
AFFILIATE, AFFILIATED shall mean, with respect to any Person, (a) any other
Person at the time directly or indirectly controlling, controlled by or under
direct or indirect common control with such Person, (b) any other Person of
which such Person at the time owns, or has the right to acquire, directly or
indirectly, twenty percent (20%) or more of any class of the capital stock or
beneficial interest, (c) any other Person which at the time owns, or has the
right to acquire, directly or indirectly, twenty percent (20%) or more of any
class of the capital stock or beneficial interest of such Person, (d) any
executive officer or director of such Person, (e) with respect to any
partnership, joint venture or similar Entity, any general partner thereof, and
(f) when used with respect to an individual, shall include any member of such
individual's family or a family trust.
AGREEMENT shall mean this Agreement as originally in effect, including,
unless the context otherwise specifically requires, this Appendix A, the TCT
Disclosure Schedule, the ATC SEC Documents and all exhibits hereto, and as any
of the same may from time to time be supplemented, amended, modified or restated
in the manner herein or therein provided.
ALTERNATIVE TRANSACTION shall mean a transaction or series of related
transactions (other than the Transactions) resulting in or likely to result in
(a) any Change of Control of TCT, (b) any merger, consolidation or other
business combination of TCT, regardless of whether TCT is the surviving Entity
unless the surviving Entity remains obligated under this Agreement to the same
extent as TCT was, (c) any tender offer or exchange offer for, or any
acquisition of, any securities of TCT, (d) any sale or other disposition of all
or any substantial part of the assets or business of TCT, or (e) any issue,
sale, transfer, pledge, assignment or other conveyance, or any agreement to
issue, sell, transfer, pledge, assign or otherwise convey, any equity
securities, Convertible Securities or Option Securities by TCT or any TCT Member
that could result in a Change of Control of TCT.
A-1
ANNUAL TOWER REVENUE RUN RATE shall mean (a) an amount equal to the normal
recurring net lease revenues (e.g., excluding charges for installation and
excluding reimbursement of expenses, other than those billed at a fixed amount,
which amount may vary from year to year and which shall be included in normal
recurring net lease revenues) received by TCT and its Subsidiaries with respect
to space rented on the towers (including net revenues received by TCT and its
Subsidiaries for managing towers of other Persons) of TCT and its Subsidiaries,
including its proportionate share of the following entities: Mid-Pacific,
Prime-Telecom Communications Co., a California general partnership, and
Shreveport Tower Company, a Louisiana general partnership multiplied by (b)
twelve (12).
APPLICABLE LAW shall mean any Law of any Authority, whether domestic or
foreign, including without limitation the FCA and all federal and state
securities and Environmental Laws, to which a Person is subject or by which it
or any of its business or operations is subject or any of its property or assets
is bound.
ATC shall have the meaning given to it in the Preamble.
ATC COMMON STOCK shall have the meaning given to it in Section 3.1.
ATC FINANCIAL STATEMENTS shall have the meaning given to it in Section 5.2.
ATC INDEMNIFIED PARTIES shall have the meaning given to it in Section
9.2(a).
ATC NONCOMPETITION AGREEMENTS shall have the meaning given to it in Section
7.2(p).
ATC SEC DOCUMENTS shall have the meaning given to it in Section 5.2.
ATC STOCK CONSIDERATION shall have the meaning given to it in Section 3.1.
ATC VOTING AGREEMENT shall have the meaning given to it in Section 7.3(h).
ATC'S KNOWLEDGE (or words of similar import) shall mean the actual
knowledge of any director or executive officer of ATC or ATI, as such knowledge
exists on the date of this Agreement, after reasonable review of appropriate ATC
and ATI records and after reasonable inquiry of appropriate ATC and ATI
employees.
ATI shall have the meaning given to it in the Preamble.
AUTHORITY shall mean any governmental or quasi-governmental authority,
whether administrative, executive, judicial, legislative or other, or any
combination thereof, including without limitation any federal, state,
territorial, county, municipal or other government or governmental or quasi-
governmental agency, arbitrator, authority, board, body, branch, bureau, or
comparable agency or Entity, commission, corporation, court, department,
instrumentality, mediator, panel, system or other political unit or subdivision
or other Entity of any of the foregoing, whether domestic or foreign, including
without limitation the FCC.
BENEFIT ARRANGEMENT shall mean any material benefit arrangement that is not
a Plan, including (a) any employment or consulting agreement, (b) any
arrangement providing for insurance coverage or workers' compensation benefits,
(c) any incentive bonus or deferred bonus arrangement, (d) any arrangement
providing termination allowance, severance or similar benefits, (e) any equity
compensation plan, (f) any deferred compensation plan, and (g) any compensation
policy and practice, but only to the extent that it covers or relates to any
officer, employee or other Person involved in the ownership and operation of the
assets of TCT or the conduct of the business of TCT.
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CASH CONSIDERATION shall have the meaning given to it in Section 3.1.
CEILING SHARE PRICE shall have the meaning given to it in Section 3.1.
CHANGE OF CONTROL shall mean the acquisition, directly or indirectly, by
any Person or group (as such term is used in Section 13(d)(3) of the Exchange
Act) of twenty percent (20%) or more of the TCT Units.
CLAIMS shall mean any and all debts, liabilities, obligations, losses,
damages, deficiencies, assessments and penalties, together with all Legal
Actions, pending or threatened, claims and judgments of whatever kind and nature
relating thereto, and all fees, costs, expenses and disbursements (including
without limitation reasonable attorneys' and other legal fees, costs and
expenses) relating to any of the foregoing.
CLOSING shall have the meaning given to it in Section 2.2.
CLOSING DATE shall have the meaning given to it in Section 2.2.
CLOSING DATE SHARE PRICE shall mean, with respect to the ATC Common Stock,
the average of the daily Fair Market Values thereof for each of the ten (10)
Trading Days prior to the Closing Date.
COBRA shall mean the Consolidated Omnibus Budget Reconciliation Act of
1985, as amended, as set forth in Section 4980B of the Code and Part 6 of
Subtitle B of Title I of ERISA.
CODE shall mean the Internal Revenue Code of 1986, and the rules and
regulations thereunder, all as from time to time in effect, or any successor
Law, rules or regulations, and any reference to any statutory or regulatory
provision shall be deemed to be a reference to any successor statutory or
regulatory provision.
COLLATERAL DOCUMENTS shall mean the Indemnity Escrow Agreement, the
Noncompetition Agreements, the Registration Rights Agreement, the TCT Investment
Letters, the Certificate of Merger, and any other agreement, certificate,
contract, instrument, notice, opinion or other document delivered pursuant to
the provisions of this Agreement or any Collateral Document.
CONFIDENTIAL INFORMATION shall have the meaning given to it in Section
6.1(a).
CONSTRUCTION COST shall mean, with respect to each of the Subject Towers
that is not in service at the Effective Time, an amount equal to the funded cost
of such Subject Tower, determined in accordance with GAAP, applied on a basis
consistent with the TCT Financial Statements.
CONTRACT, CONTRACTUAL OBLIGATION shall mean any agreement, arrangement,
commitment, contract, covenant, indemnity, undertaking or other obligation or
liability to which TCT is a party or to which it or any of the TCT Assets is
subject.
CONTROL (including the terms "controlled," "controlled by" and "under
common control with") means the possession, directly or indirectly or as trustee
or executor, of the power to direct or cause the direction of the management or
policies of a Person, or the disposition of such Person's assets or properties,
whether through the ownership of stock, equity or other ownership, by contract,
arrangement or understanding, or as trustee or executor, by contract or credit
arrangement or otherwise.
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CONVERTIBLE SECURITIES shall mean any evidences of indebtedness, shares of
capital stock (other than common stock) or other securities directly or
indirectly convertible into or exchangeable for shares of common stock, or other
securities directly or indirectly convertible into or exchangeable for TCT Units
or other equity interests of TCT, whether or not the right to convert or
exchange thereunder is immediately exercisable or is conditioned upon the
passage of time, the occurrence or non-occurrence or existence or non-existence
of some other Event, or both.
COX shall mean Cox Telecom Towers, Inc., a Delaware corporation and one of
the TCT Members.
CURRENT BALANCE shall mean, with respect to TCT, the amount by which the
current assets of TCT and its Subsidiaries are more (or are less than) the
current liabilities of TCT (exclusive of current maturities of principal of any
Indebtedness for Money Borrowed), as determined in accordance with GAAP,
consistently applied with the TCT Financial Statements.
CURRENT MARKET PRICE shall mean, with respect to the ATC Common Stock, the
average of the daily Fair Market Values thereof for each of the twenty (20)
Trading Days commencing ten (10) Trading Days prior to the date of this
Agreement; provided, however that the Current Market Price shall not be less
than $19.20 or more than $21.25.
DCL shall have the meaning given to it in Section 2.1.
DISTRIBUTION shall mean, with respect to any Person, (a) the declaration or
payment of any dividend (except dividends payable in common stock of such
Person) on or in respect of any shares of any class of capital stock of such
Person or any shares of capital stock of any Subsidiary owned by a Person other
than such Person or a Subsidiary of such Person, (b) the purchase, redemption or
other retirement of any shares of any class of capital stock of such Person or
any shares of capital stock of any Subsidiary of such Person owned by a Person
other than such Person or a Subsidiary of such Person, and (c) any other
distribution on or in respect of any shares of any class of capital stock of
such Person or any shares of capital stock of any Subsidiary of such Person
owned by a Person other than such Person or a Subsidiary of such Person.
DLLCA shall have the meaning given to it in Section 2.1.
EFFECTIVE TIME shall have the meaning given to it in Section 2.3.
EMPLOYMENT ARRANGEMENT shall mean, with respect to TCT, any employment,
consulting, retainer, severance or similar contract, agreement, plan,
arrangement or policy (exclusive of any which is terminable within thirty (30)
days without liability, penalty or payment of any kind by TCT or any of its
Affiliates), providing for severance, termination payments, insurance coverage
(including any self-insured arrangements), workers compensation, disability
benefits, life, health, medical, dental or hospitalization benefits,
supplemental unemployment benefits, vacation or sick leave benefits, pension or
retirement benefits or for deferred compensation, profit-sharing, bonuses, stock
options, stock purchase or appreciation rights or other forms of incentive
compensation or post-retirement insurance, compensation or benefits, or any
collective bargaining or other labor agreement, whether or not any of the
foregoing is subject to the provisions of ERISA, but only to the extent that it
covers or relates to any officer, employee or other Person involved in the
ownership or operation of the TCT Assets or the conduct of the TCT Business.
ENCUMBER shall mean to suffer, accept, agree to or permit the imposition of
a Lien.
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ENTITY shall mean any corporation, firm, unincorporated organization,
association, partnership, limited liability company, trust (inter vivos or
testamentary), estate of a deceased, insane or incompetent individual, business
trust, joint stock company, joint venture or other organization, entity or
business, whether acting in an individual, fiduciary or other capacity, or any
Authority.
ENVIRONMENTAL LAW shall mean any Law relating to or otherwise imposing
liability or standards of conduct concerning pollution or protection of the
environment, including without limitation Laws relating to emissions,
discharges, releases or threatened releases of Hazardous Materials or other
chemicals or industrial pollutants, substances, materials or wastes into the
environment (including, without limitation, ambient air, surface water, ground
water, mining or reclamation or mined land, land surface or subsurface strata)
or otherwise relating to the manufacture, processing, generation, distribution,
use, treatment, storage, disposal, cleanup, transport or handling of pollutants,
contaminants, chemicals or industrial, toxic or hazardous substances, materials
or wastes. Environmental Laws shall include without limitation the
Comprehensive Environmental Response, Compensation and Liability Act (42 U.S.C.
Section 6901 et seq.), the Hazardous Material Transportation Act (49 U.S.C.
-- ---
Section 1801 et seq.), the Resource Conservation and Recovery Act (42 U.S.C.
-- ---
Section 6901 et seq.), the Federal Water Pollution Control Act (33 U.S.C.
-- ---
Section 1251 et seq.), the Clean Air Act (42 U.S.C. Section 7401 et seq.), the
-- --- -- ---
Toxic Substances Control Act (15 U.S.C. Section 2601 et seq.), the Occupational
-- ---
Safety and Health Act (29 U.S.C. Section 651 et seq.), the Federal Insecticide
-- ---
Fungicide and Rodenticide Act (7 U.S.C. Section 136 et seq.), and the Surface
-- ---
Mining Control and Reclamation Act of 1977 (30 U.S.C. Section 1201 et seq.), and
-- ---
any analogous federal, state, local or foreign Laws, and the rules and
regulations promulgated thereunder all as from time to time in effect, and any
reference to any statutory or regulatory provision shall be deemed to be a
reference to any successor statutory or regulatory provision.
ENVIRONMENTAL PERMIT shall mean any Governmental Authorization required by
or pursuant to any Environmental Law.
ENVIRONMENTAL REPORT shall have the meaning given to it in Section 4.19.
ERISA shall mean the Employee Retirement Income Security Act of 1974, and
the rules and regulations thereunder, all as from time to time in effect, or any
successor law, rules or regulations, and any reference to any statutory or
regulatory provision shall be deemed to be a reference to any successor
statutory or regulatory provision.
ERISA AFFILIATE shall mean any Person that is treated as a single employer
with TCT under Sections 414(b), (c), (m) or (o) of the Code or Section
4001(b)(1) of ERISA.
EVENT shall mean the existence or occurrence of any act, action, activity,
circumstance, condition, event, fact, failure to act, omission, incident or
practice, or any set or combination of any of the foregoing.
EXCHANGE ACT shall mean the Securities Exchange Act of 1934, and the rules
and regulations thereunder, all as from time to time in effect, or any successor
Law, rules or regulations, and any reference to any statutory or regulatory
provision shall be deemed to be a reference to any successor statutory or
regulatory provision.
FAIR MARKET VALUE shall mean, with respect to the ATC Common Stock, (a) the
average of the high and low reported sales prices, regular way, or, in the event
that no sale takes place on any day, the average of the reported high and low
bid and asked prices, regular way, in either case as reported on the principal
stock exchange on which such stock is listed, or, if not so listed, on the
Nasdaq National Market System; or
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(b) if such stock is not so listed, (i) the average of the high and low bid and
high and low asked prices on such day in the over-the-counter market as reported
by Nasdaq, or (ii) if bid and asked prices for such security on any day shall
not have been reported through Nasdaq, the average of the bid and asked prices
for such day as furnished by any New York Stock Exchange member firm regularly
making a market in such security, or (c) if such security is not publicly
traded, as from time to time agreed to by ATC and the TCT Members or, if no such
agreement is reached within ten (10) business days of good faith negotiations,
as determined by an independent investment banking firm mutually agreeable to
ATC and the TCT Members whose fees and expenses shall be shared equally by ATC
and the TCT Members.
FCA shall mean the Communications Act of 1934, and the rules and
regulations thereunder, all as from time to time in effect, or any successor
Law, rules or regulations, and any reference to any statutory or regulatory
provision shall be deemed to be a reference to any successor statutory or
regulatory provision.
FCC shall mean the United States Federal Communications Commission and
shall include any successor Authority.
FLOOR SHARE PRICE shall have the meaning given to it in Section 3.1.
GAAP shall mean generally accepted accounting principles applied on a
consistent basis, (i) as set forth in Opinions of the Accounting Principles
Board of the American Institute of Certified Public Accountants ("AICPA") and/or
in statements of the Financial Accounting Standards Board that are applicable in
the circumstances as of the date in question, (ii) when not inconsistent with
such opinions and statements, as set forth in other AICPA publications and
guidelines and/or (iii) that otherwise arise by custom for the particular
industry, all as the same shall exist on the date of this Agreement.
GOVERNMENTAL AUTHORIZATIONS shall mean all approvals, concessions,
consents, franchises, licenses, permits, plans, registrations and other
authorizations of all Authorities, including without limitation the United
States Forest Service and the Federal Aviation Administration, in connection
with the ownership or operation of the TCT Assets or the conduct of the TCT
Business.
GOVERNMENTAL FILINGS shall mean all filings, including franchise and
similar Tax filings, and the payment of all fees, assessments, interest and
penalties associated with such filings, with all Authorities.
XXXX-XXXXX-XXXXXX ACT shall mean the Xxxx-Xxxxx-Xxxxxx Improvement Act of
1976, as from time to time in effect, or any successor Law, and any reference to
any statutory provision shall be deemed to be a reference to any successor
statutory provision.
HAZARDOUS MATERIALS shall mean and include any substance, material, waste,
constituent, compound, chemical, natural or man-made element or force (in
whatever state of matter): (a) the presence of which requires investigation or
remediation under any Environmental Law; or (b) that is defined as a "hazardous
waste" or "hazardous substance" under any Environmental Law; or (c) that is
toxic, explosive, corrosive, etiologic, flammable, infectious, radioactive,
carcinogenic, mutagenic or otherwise hazardous and is regulated by any
applicable Authority or subject to any Environmental Law; or (d) the presence of
which on the real property owned or leased by such Person causes or threatens to
cause a nuisance upon any such real property or to adjacent properties or poses
or threatens to pose a hazard to the health or safety of persons on or about any
such real property; or (e) the presence of which on adjacent properties could
constitute a trespass by such Person; or (f) that contains gasoline, diesel fuel
or other petroleum hydrocarbons, or any by-products or fractions thereof,
natural gas, polychlorinated biphenyls ("PCBs") and PCB-containing equipment,
radon or other radioactive elements, ionizing radiation, electromagnetic field
radiation and other non-ionizing radiation, sonic forces and other natural
forces, lead, asbestos or asbestos-containing materials ("ACM"), or urea
formaldehyde foam insulation.
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INDEBTEDNESS shall mean, with respect to any Person as of any date, (a)
all items, except items of capital stock or of surplus or of general contingency
or deferred tax reserves or any minority interest in any Subsidiary of such
Person to the extent such interest is treated as a liability with an
indeterminate term on the consolidated balance sheet of such Person, which in
accordance with GAAP would be included in determining total liabilities as shown
on the liability side of a balance sheet of such Person, (b) all obligations
secured by any Lien to which any property or asset owned or held by such Person
is subject, whether or not the obligation secured thereby shall have been
assumed, and (c) to the extent not otherwise included, all Contractual
Obligations of such Person constituting capitalized leases and all obligations
of such Person with respect to Leases constituting part of a sale and leaseback
arrangement.
INDEBTEDNESS FOR MONEY BORROWED shall mean, with respect to any Person as
of any date, money borrowed and Indebtedness represented by notes payable and
drafts accepted representing extensions of credit, all obligations evidenced by
bonds, debentures, notes or other similar instruments, the maximum amount
currently or at any time thereafter available to be drawn under all outstanding
letters of credit issued for the account of such Person, all Indebtedness upon
which interest charges are customarily paid by such Person, and all Indebtedness
(including capitalized lease obligations) issued or assumed as full or partial
payment for property or services, whether or not any such notes, drafts,
obligations or Indebtedness represent Indebtedness for money borrowed, but shall
not include (a) trade payables, (b) expenses accrued in the ordinary course of
business, (c) customer advance payments and customer deposits received in the
ordinary course of business, or (d) conditional sales agreements not prohibited
by the terms of this Agreement.
INDEMNITY ESCROW AGREEMENT shall have the meaning given to it in Section
7.2(s).
INTANGIBLE ASSETS shall mean all assets and property lacking physical
properties the evidence of ownership of which must customarily be maintained by
independent registration, documentation, certification, recordation or other
means, and shall include, without limitation, concessions, copyrights,
franchises, licenses, patents, permits, service marks, trademarks, trade names,
and applications with respect to any of the foregoing, technology and know-how.
INTELLECTUAL PROPERTY shall mean any and all research, information,
inventions, designs, procedures, developments, discoveries, improvements,
patents and applications therefor, trademarks and applications therefor, service
marks, trade names, copyrights and applications therefor, logos, trade secrets,
drawing, plans, systems, methods, specifications, computer software programs,
tapes, discs and related data processing software (including without limitation
object and source codes) owned by such Person or in which it has an ownership
interest and all other manufacturing, engineering, technical, research and
development data and know-how made, conceived, developed and/or acquired by such
Person, which relate to the manufacture, production or processing of any
products developed or sold by such Person or which are within the scope of or
usable in connection with such Person's business as it may, from time to time,
hereafter be conducted or proposed to be conducted.
INTERIM PERIOD shall have the meaning given to it in Section 11.14.
LAW shall mean any (a) administrative, judicial, legislative or other
action, code, consent decree, constitution, decree, directive, enactment,
finding, law, injunction, interpretation, judgment, order, ordinance, policy
statement, proclamation, promulgation, regulation, requirement, rule, rule of
law, rule of public
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policy, settlement agreement, statute, or writ of any Authority, domestic or
foreign; (b) the common law, or other legal precedent; or (c) arbitrator's,
mediator's or referee's award, decision, finding or recommendation.
LEASE shall mean any lease of property, whether real, personal or mixed,
and all amendments thereto, and shall include without limitation all use or
occupancy agreements.
LEGAL ACTION shall mean, with respect to any Person, any and all litigation
or legal or other actions, arbitrations, counterclaims, investigations,
proceedings, requests for material information by or pursuant to the order of
any Authority or suits, at law or in arbitration, equity or admiralty, whether
or not purported to be brought on behalf of such Person, affecting such Person
or any of such Person's business, property or assets.
LIEN shall mean any of the following: mortgage; lien (statutory or other);
or other security agreement, arrangement or interest; hypothecation, pledge or
other deposit arrangement; assignment; charge; levy; executory seizure;
attachment; garnishment; encumbrance (including any easement, exception,
reservation or limitation, right of way, and the like); conditional sale, title
retention or other similar agreement, arrangement, device or restriction;
preemptive or similar right; any financing lease involving substantially the
same economic effect as any of the foregoing; the filing of any financing
statement under the Uniform Commercial Code or comparable law of any
jurisdiction; restriction on sale, transfer, assignment, disposition or other
alienation; or any option, equity, claim or right of or obligation to, any other
Person, of whatever kind and character.
LOSS AND EXPENSE shall have the meaning given to it in Section 9.2(a).
MATERIAL, MATERIALLY OR MATERIALITY for the purposes of this Agreement,
shall, unless specifically stated to the contrary, be determined without regard
to the fact that various provisions of this Agreement set forth specific dollar
amounts.
MATERIAL AGREEMENT shall mean, with respect to TCT, any Contractual
Obligation which (a) was not entered into in the ordinary course of business,
(b) was entered into in the ordinary course of business which (i) involved the
purchase, sale or lease of goods or materials, or purchase of services,
aggregating more than $100,000 since December 31, 1997, (ii) extends for more
than three (3) months, or (iii) is not terminable on thirty (30) days or less
notice without penalty or other payment or (iv) involves the leasing of space on
any tower of TCT involving not less than $10,000 in annual rental payments, (c)
involves a capitalized lease obligation or Indebtedness for Money Borrowed, (d)
is or otherwise constitutes a written agency, broker, dealer, license,
distributorship, sales representative or similar written agreement, (e)
accounted for more than three percent (3%) of the revenues of the TCT Business
in any of the last three fiscal years or is likely to account for more than
three percent (3%) of revenues of the TCT Business during the current fiscal
year, (f) is with the United States Forest Service, or (g) involves the
management by TCT of any communication tower of any other Person.
MERGER shall have the meaning given to it in the first Whereas paragraph.
MERGER CONSIDERATION shall have the meaning given to it in Section 3.1.
MERGER PRICE shall have the meaning given to it in Section 3.1.
MID PACIFIC shall mean Mid-Pacific-Telecom Communications Co., a Nevada
general partnership.
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MULTIEMPLOYER PLAN shall mean a Plan which is a "multiemployer plan" within
the meaning of Section 4001(a)(3) of ERISA.
OPTION SECURITIES shall mean all stock or equity appreciation rights,
rights, options and warrants, and calls or commitments evidencing the right, to
subscribe for, purchase or otherwise acquire shares of capital stock or TCT
Units or other equity interests in TCT or Convertible Securities, whether or not
the right to subscribe for, purchase or otherwise acquire is immediately
exercisable or is conditioned upon the passage of time, the occurrence or non-
occurrence or the existence or non-existence of some other Event.
ORGANIC DOCUMENT shall mean, with respect to a Person which is a
corporation, its charter, its by-laws and all shareholder agreements, voting
trusts and similar arrangements applicable to any of its capital stock, with
respect to a Person which is a partnership, its agreement and certificate of
partnership, any agreements among partners, and any management and similar
agreements between the partnership and any general partners (or any Affiliate
thereof) or, with respect to a Person which is a limited liability company, its
agreement of limited liability company, any agreements among members, and any
management and similar agreements between the limited liability company and any
member (or any Affiliate thereof).
PERMITTED LIENS shall mean (a) Liens for current Taxes not yet due and
payable, (b) such imperfections of title, easements, encumbrances and mortgages
or other Liens, or other matters of record if any, as are not, individually or
in the aggregate, substantial in character, amount or extent and that do not
materially detract from the value, or materially interfere with the present use,
of the property subject thereto or affected thereby, or otherwise materially
impair the conduct of the TCT Business, (c) Liens securing Indebtedness for
Money Borrowed of a nature referred to in Section 7.2(q), and (d) such other
Liens as are permitted by the provisions of this Agreement to be in place on the
Closing Date.
PERSON shall mean any natural individual or any Entity.
PERSONAL PROPERTY shall mean all of the machinery, equipment, tools,
vehicles, furniture, leasehold improvements, office equipment, plant, inventory,
spare parts and other tangible personal property which are owned or leased by
TCT and used or useful as of the date hereof in the conduct of the business or
operations of the TCT Business, plus such additions thereto and deletions
therefrom arising in the ordinary course of business between the date hereof and
the Closing Date.
PLAN shall mean, with respect to any Person and at a particular time, any
employee benefit plan which is covered by ERISA and in respect of which such
Person or an ERISA Affiliate is (or, if such plan were terminated at such time,
would under Section 4069 of ERISA be deemed to be) an "employer" as defined in
Section 3(5) of ERISA, but only to the extent that it covers or relates to any
officer, employee or other Person involved in the ownership and operation of the
TCT Assets or the conduct of the business of the TCT Business.
PRIVATE AUTHORIZATIONS shall mean all approvals, concessions, consents,
franchises, licenses, permits, and other authorizations of all Persons (other
than Authorities) including without limitation those with respect to
Intellectual Property, but excluding leases, easements and other rights to use
real property.
RCC shall mean RCC Consultants, Inc., a Delaware corporation.
REAL PROPERTY shall mean all of the fee estates and buildings and other
fixtures and improvements thereon, leasehold interests, easements, licenses,
rights to access, rights-of-way, and other real property interests which are
owned or used by TCT as of the date hereof, in the operations of the TCT
Business, plus such additions thereto and deletions therefrom arising in the
ordinary course of business between the date hereof and the Closing Date.
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REGISTRATION RIGHTS AGREEMENT shall have the meaning given to it in Section
7.2(m).
REGULATIONS shall mean the federal income tax regulations promulgated under
the Code, as such Regulations may be amended from time to time. All references
herein to specific sections of the Regulations shall be deemed also to refer to
any corresponding provisions of succeeding Regulations, and all references to
temporary Regulations shall be deemed also to refer to any corresponding
provisions of final Regulations.
REPRESENTATIVES shall have the meaning given to it in Section 6.1(a).
RESTRICTED TRANSACTION shall mean any (i) acquisition or agreement to
acquire (x) by merging or consolidating with, or by purchasing a substantial
portion of the assets of, or by any other manner, any business or any Person or
other business organization or division thereof or (y) any assets (other than in
the ordinary course of business which for purposes of this definition does not
include the acquisition of communications sites and related assets and other
business involved in the communications sites industry or the construction of
communications towers and related assets), or (ii) any undertaking or agreement
to undertake the construction of one or more communications towers.
SEC shall mean the United States Securities and Exchange Commission.
SECURITIES ACT shall mean the Securities Act of 1933, and the rules and
regulations thereunder, all as from time to time in effect, or any successor
Law, rules or regulations, and any reference to any statutory or regulatory
provision shall be deemed to be a reference to any successor statutory or
regulatory provision.
SOLVENT shall mean, with respect to any Person on a particular date, that
such Person is "solvent" within the meaning of the federal Bankruptcy Code and
applicable state insolvency and fraudulent conveyance statutes.
SUBSIDIARY shall mean, with respect to a Person, any Entity a majority of
the capital stock ordinarily entitled to vote for the election of directors of
which, or if no such voting stock is outstanding, a majority of the equity
interests of which, is owned directly or indirectly, legally or beneficially, by
such Person or any other Person controlled by such Person, other than RCC.
SURVIVING CORPORATION shall have the meaning given to it in Section 2.1.
TAX (and "Taxable", which shall mean subject to Tax), shall mean, with
respect to any Person, (a) all taxes (domestic or foreign), including without
limitation any income (net, gross or other including recapture of any tax items
such as investment tax credits), alternative or add-on minimum tax, gross
income, gross receipts, gains, sales, use, leasing, lease, user, ad valorem,
transfer, recording, franchise, profits, property (real or personal, tangible or
intangible), fuel, license, withholding on amounts paid to or by such Person,
payroll, employment, unemployment, social security, excise, severance, stamp,
occupation, premium, environmental or windfall profit tax, custom, duty or other
tax, or other like assessment or charge of any kind whatsoever, together with
any interest, levies, assessments, charges, penalties, additions to tax or
additional amount imposed by any Taxing Authority, (b) any joint or several
liability of such Person with any other Person for the payment of any amounts of
the type described in (a), and (c) any liability of such Person for the payment
of any amounts of the type described in (a) as a result of any express or
implied obligation to indemnify any other Person.
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TAX RETURN OR RETURNS shall mean all returns, consolidated or otherwise
(including without limitation information returns), required to be filed with
any Authority with respect to Taxes.
TAXING AUTHORITY shall mean any Authority responsible for the imposition of
any Tax.
TCT shall have the meaning given to it in the Preamble.
TCT ASSETS shall have the meaning given to it in Section 4.4(a) and shall,
in any event, include the assets of TCT's Subsidiaries, as contemplated by
Section 4.4(a) and the final sentence of Section 4.1(d).
TCT BUSINESS shall have the meaning given to it in Section 4.4(b) and
shall, in any event, include the business of TCT's Subsidiaries, as contemplated
by Section 4.4(b) and the final sentence of Section 4.1(d).
TCT DISCLOSURE SCHEDULE shall mean the TCT Disclosure Schedule to be
furnished in accordance with Section 10.14.
TCT EMPLOYEES shall have the meaning given it in Section 4.14.
TCT FINANCIAL STATEMENTS shall have the meaning given to it in Section 4.2.
TCT INVESTMENT LETTERS shall have the meaning given to it in Section
7.2(n).
TCT MEMBER(S) shall have the meaning given to such terms in the first
Whereas paragraph.
TCT UNITS shall have the meaning given to it in Section 3.1.
TCT'S KNOWLEDGE (or words of similar import) shall mean the actual
knowledge of any TCT Member or any TCT Management Committee representative or
officer, as such knowledge exists on the date of this Agreement, after
reasonable review of appropriate TCT records and after reasonable inquiry of
appropriate TCT employees.
TITLE REPORT shall have the meaning given to it in Section 6.7.
TERMINATION DATE shall have the meaning given to it in Section 8.1.
TRADING DAY shall mean any day on which shares of ATC Common Stock are
actually sold on the New York Stock Exchange.
TRANSACTIONS shall mean the transactions contemplated to be consummated on
or prior to the Closing Date, including without limitation the Merger and the
execution, delivery and performance of the Collateral Documents.
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