EXHIBIT 2.1
CONFORMED COPY
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AGREEMENT AND PLAN OF MERGER
by and among
AT&T WIRELESS SERVICES, INC.
TL ACQUISITION CORP.
and
TELECORP PCS, INC.
Dated as of October 7, 2001
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TABLE OF CONTENTS
ARTICLE I
THE MERGER
1.1 The Merger..............................................................
1.2 Effective Time..........................................................
1.3 Effect of the Merger....................................................
1.4 Certificate of Incorporation and By-laws of the Surviving Corporation...
1.5 Directors and Officers..................................................
1.6 Conversion of Capital Stock, Etc........................................
1.7 Cancellation of Certain Shares; Conversion of Merger Sub Stock..........
1.8 Stock Options; Restricted Stock.........................................
1.9 Adjustments.............................................................
1.10 Fractional Shares.......................................................
1.11 Surrender of Certificates...............................................
1.12 Further Ownership Rights in Shares......................................
1.13 Closing.................................................................
1.14 Lost, Stolen or Destroyed Certificates..................................
1.15 Follow-On Merger........................................................
1.16 Dissenting Shares.......................................................
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF TELECORP
2.1 Organization and Qualification; Subsidiaries............................
2.2 Certificate of Incorporation; By-laws...................................
2.3 Capitalization..........................................................
2.4 Authority; Enforceability...............................................
2.5 Board Recommendation; Required Vote.....................................
2.6 No Conflict; Required Filings and Consents..............................
2.7 Material Agreements.....................................................
2.8 Compliance..............................................................
2.9 SEC Filings; Financial Statements.......................................
2.10 Licenses and Authorizations.............................................
2.11 No Violation of Law.....................................................
2.12 Absence of Certain Changes or Events....................................
2.13 Absence of Liabilities..................................................
2.14 Absence of Litigation...................................................
2.15 Employee Benefit Plans..................................................
2.16 Employment and Labor Matters............................................
2.17 Registration Statement; Proxy Statement/Prospectus......................
2.18 Microwave Clearing......................................................
2.19 Title to Assets; Leases.................................................
2.20 Taxes...................................................................
2.21 Environmental Matters...................................................
2.22 Intellectual Property...................................................
2.23 No Restrictions on the Merger; Takeover Statutes........................
2.24 Tax Matters.............................................................
2.25 Build-out Requirements..................................................
2.26 Brokers.................................................................
2.27 Opinion of Financial Advisor............................................
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF AWS
3.1 Organization and Qualification; Subsidiaries............................
3.2 Certificate of Incorporation; By-laws...................................
3.3 Capitalization..........................................................
3.4 Authority; Enforceability...............................................
3.5 No Conflict; Required Filings and Consents..............................
3.6 Compliance..............................................................
3.7 SEC Filings; Financial Statements.......................................
3.8 Licenses and Authorizations.............................................
3.9 No Violation of Law.....................................................
3.10 Absence of Litigation...................................................
3.11 Registration Statement; Proxy Statement/Prospectus......................
3.12 Taxes...................................................................
3.13 Tax Matters.............................................................
3.14 Absence of Changes......................................................
3.15 Brokers.................................................................
3.16 Severance Policy; Letter Agreement......................................
ARTICLE IV
ADDITIONAL AGREEMENTS
4.1 Access to Information; Confidentiality..................................
4.2 Conduct of Business Pending the Closing Date............................
4.3 Registration Statement; Other Filings; Board Recommendations............
4.4 Meeting of TeleCorp Stockholders........................................
4.5 Non-Solicitation........................................................
4.6 Blue Sky................................................................
4.7 Registration and Listing of AWS Capital Stock...........................
4.8 Further Actions.........................................................
4.9 Notification............................................................
4.10 Notice of Breaches; Updates.............................................
4.11 Affiliates..............................................................
4.12 Employee Benefit Matters................................................
4.13 Indemnification and Insurance...........................................
4.14 Plan of Reorganization..................................................
4.15 Tax-Free Exchange.......................................................
4.16 Extension of Birmingham/Tuscaloosa Put Right............................
ARTICLE V
CLOSING CONDITIONS
5.1 Conditions to Obligations of TeleCorp and AWS to Effect the Merger......
5.2 Additional Conditions to Obligations of TeleCorp........................
5.3 Additional Conditions to the Obligations of AWS.........................
ARTICLE VI
TERMINATION
6.1 General.................................................................
6.2 Obligations in Event of Termination.....................................
6.3 Termination Fees........................................................
ARTICLE VII
NO SURVIVAL
7.1 No Survival of Representations and Warranties...........................
ARTICLE VIII
MISCELLANEOUS
8.1 Public Announcements....................................................
8.2 Fees and Expenses.......................................................
8.3 Notices.................................................................
8.4 Certain Definitions.....................................................
8.5 Interpretation..........................................................
8.6 Entire Agreement........................................................
8.7 Binding Effect; Benefit.................................................
8.8 Assignability...........................................................
8.9 Amendment; Waiver.......................................................
8.10 Section Headings; Table of Contents.....................................
8.11 Severability............................................................
8.12 Counterparts............................................................
8.13 Governing Law; Jurisdiction and Service of Process......................
8.14 Waiver of Jury Trial....................................................
EXHIBITS
Exhibit A AWS Series C Preferred Certificate of Designations
Exhibit B Form of AWS Series E Preferred Certificate of Designations
Exhibit C Form of Affiliates Letter
Exhibit D Form of AWS Tax Representation Letter
Exhibit E Form of TeleCorp Tax Representation Letter
Exhibit F Transfer Agreements
Exhibit G Change of Control Severance Policy
Exhibit H Letter Agreement with TeleCorp Management Corp.
AGREEMENT AND PLAN OF MERGER
AGREEMENT AND PLAN OF MERGER (this "Agreement"), dated as of October
7, 2001, by and among TeleCorp PCS, Inc., a Delaware corporation ("TeleCorp"),
AT&T Wireless Services, Inc., a Delaware corporation ("AWS") and TL Acquisition
Corp., a newly formed Delaware corporation and a wholly owned subsidiary of AWS
("Merger Sub").
WITNESSETH:
WHEREAS, the respective Boards of Directors of TeleCorp, AWS and
Merger Sub, as well as all of the directors of TeleCorp who are not employees of
AWS (the "Disinterested Directors"), have approved this Agreement, and deem it
advisable and in the best interests of their respective stockholders to
consummate the merger of Merger Sub with and into TeleCorp on the terms and
conditions set forth in this Agreement (the "Merger");
WHEREAS, for United States federal income tax purposes, it is
intended that either the Merger or the combination of the Merger and the
Follow-On Merger, as applicable, qualify as a "reorganization" within the
meaning of Section 368 of the Internal Revenue Code of 1986, as amended (the
"Code"), and the rules and regulations promulgated thereunder;
WHEREAS, as an inducement to and a condition to AWS entering into
this Agreement, simultaneously herewith certain stockholders of TeleCorp are
entering into Voting Agreements relating to the agreement of such stockholders
to vote to approve the transactions contemplated by this Agreement (the "Voting
Agreements"); and
NOW, THEREFORE, in consideration of the premises and mutual
covenants herein contained, and other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the parties hereto,
intending to be legally bound, agree as follows:
ARTICLE I
THE MERGER
1.1 The Merger. At the Effective Time and subject to the terms and
conditions of this Agreement, and in accordance with the General Corporation Law
of the State of Delaware ("DGCL"), Merger Sub shall be merged with and into
TeleCorp, with TeleCorp as the surviving corporation. From and after the
Effective Time, the separate corporate existence of Merger Sub shall cease, and
TeleCorp, as the surviving corporation, shall continue its existence under the
laws of the State of Delaware as a wholly owned subsidiary of AWS. TeleCorp, as
the surviving corporation after the Merger, is hereinafter sometimes referred to
as the "Surviving Corporation."
1.2 Effective Time. As soon as practicable after satisfaction or, to
the extent permitted hereunder, waiver of the conditions set forth in Article V
(excluding, but subject to the satisfaction or waiver of, conditions that, by
their nature, cannot be satisfied prior to the Closing Date), but in no event
prior to the Closing, TeleCorp and AWS shall cause the Merger to be consummated
by filing a certificate of merger (the "Certificate of Merger") with the
Secretary of State of the State of Delaware, executed in accordance with the
relevant provisions of the DGCL (the date and time of such filing, or such later
date and time as may be specified by mutual agreement in the Certificate of
Merger, being the "Effective Time").
1.3 Effect of the Merger. At the Effective Time, the effect of the
Merger shall be as provided in the applicable provisions of the DGCL and the
Certificate of Merger. Without limiting the generality of the foregoing, and
subject thereto, at the Effective Time all the assets, property, rights,
privileges, immunities, powers and franchises of TeleCorp and Merger Sub shall
vest in the Surviving Corporation, and all debts, liabilities and duties of
TeleCorp and Merger Sub shall become the debts, liabilities and duties of the
Surviving Corporation.
1.4 Certificate of Incorporation and By-laws of the Surviving
Corporation. At the Effective Time, by virtue of the Merger and without further
action on the part of any party, the Restated Certificate of Incorporation of
TeleCorp shall be amended to read in its entirety as the certificate of
incorporation of Merger Sub in effect immediately prior to the Effective Time
(except that the name of the corporation shall remain TeleCorp, and the
provision relating to the incorporator shall be omitted) and as so amended shall
be the certificate of incorporation of the Surviving Corporation, until
thereafter amended as provided by the DGCL; provided that, if the votes received
in connection with the Required Stockholder Approval are not sufficient under
the Restated Certificate of Incorporation of TeleCorp to cause such amendment,
then the Restated Certificate of Incorporation of TeleCorp as in effect
immediately prior to the Effective Time shall remain the certificate of
incorporation of the Surviving Corporation, until thereafter amended as provided
by the DGCL. At the Effective Time, the by-laws of Merger Sub shall be the
by-laws of the Surviving Corporation until thereafter amended as provided by the
DGCL.
1.5 Directors and Officers.
(a) The directors of Merger Sub immediately prior to the Effective
Time shall be the initial directors of the Surviving Corporation, each to hold
office in accordance with the Certificate of Incorporation and the By-laws of
the Surviving Corporation until their respective successors are duly elected or
appointed and qualified or until their earlier death, resignation or removal in
accordance with the Surviving Corporation's Certificate of Incorporation and
By-laws.
(b) The officers of TeleCorp immediately prior to the Effective Time
shall be the initial officers of the Surviving Corporation, each to hold office
in accordance with the Certificate of Incorporation and the By-laws of Merger
Sub until their respective successors are duly elected or appointed and
qualified or until their earlier death, resignation or removal in accordance
with Merger Sub's Certificate of Incorporation and By-laws.
1.6 Conversion of Capital Stock, Etc. Subject to the provisions of
this Article I, at the Effective Time, by virtue of the Merger, and without any
action on the part of any party:
(a) With respect to each share of Common Stock, par value $0.01 per
share, of TeleCorp ("TeleCorp Common Stock"):
(i) each share of TeleCorp Class A Voting Common Stock, par value
$0.01 per share, issued and outstanding immediately prior to the Effective
Time (other than any shares to be canceled pursuant to Section 1.7) shall
be converted automatically into and become changeable for .9 shares of
AWS, par value $0.01 per share ("AWS Common Stock");
(ii) each share of TeleCorp Class C Common Stock, par value $0.01
per share, issued and outstanding immediately prior to the Effective Time
(other than any shares to be canceled pursuant to Section 1.7 or the
Dissenting Shares) shall be converted automatically into and become
exchangeable for .9 shares of AWS Common Stock;
(iii) each share of TeleCorp Class D Common Stock, par value
$0.01 per share, issued and outstanding immediately prior to the Effective
Time (other than any shares to be canceled pursuant to Section 1.7 or the
Dissenting Shares) shall be converted automatically into and become
exchangeable for .9 shares of AWS Common Stock;
(iv) each share of TeleCorp Class E Common Stock, par value $0.01
per share, issued and outstanding immediately prior to the Effective Time
(other than any shares to be canceled pursuant to Section 1.7 or the
Dissenting Shares) shall be converted automatically into and become
exchangeable for .9 shares of AWS Common Stock;
(v) each share of TeleCorp Class F Common Stock, par value $0.01
per share, issued and outstanding immediately prior to the Effective Time
(other than any shares to be canceled pursuant to Section 1.7 or the
Dissenting Shares) shall be converted automatically into and become
exchangeable for .9 shares of AWS Common Stock; and
(vi) each share of TeleCorp Voting Preference Common Stock, par
value $0.01 per share, issued and outstanding immediately prior to the
Effective Time (other than any shares to be canceled pursuant to Section
1.7 or the Dissenting Shares) shall be converted automatically into and
become exchangeable for .9 shares of AWS Common Stock.
(b) With respect to each share of Preferred Stock, par value $0.01
per share, of TeleCorp ("TeleCorp Preferred Stock" and, together with the
TeleCorp Common Stock, "TeleCorp Capital Stock") that is outstanding:
(i) each share of TeleCorp Series A Convertible Preferred Stock,
par value $0.01 per share, issued and outstanding immediately prior to the
Effective Time (other than any shares to be canceled pursuant to Section
1.7 or the Dissenting Shares) shall be converted automatically into and
become exchangeable for 82.9849 shares of AWS Common Stock;
(ii) each share of TeleCorp Series B Preferred Stock, par value
$0.01 per share, issued and outstanding immediately prior to the Effective
Time (other than any shares to be canceled pursuant to Section 1.7 or the
Dissenting Shares) shall be converted automatically into and become
exchangeable for 81.2439 shares of AWS Common Stock;
(iii) each share of TeleCorp Series C Preferred Stock, par value
$0.01 per share, issued and outstanding immediately prior to the Effective
Time (other than any shares to be canceled pursuant to Section 1.7 or the
Dissenting Shares) shall be converted automatically into and become
exchangeable for one share of a new series of preferred stock of AWS to be
designated as Series C Preferred Stock of AWS ("AWS Series C Preferred
Stock") having terms substantially as set forth in the form of the Series
C Preferred Certificate of Designation attached as Exhibit A hereto;
(iv) each share of TeleCorp Series D Preferred Stock, par value
$0.01 per share, issued and outstanding immediately prior to the Effective
Time (other than any shares to be canceled pursuant to Section 1.7 or the
Dissenting Shares) shall be converted automatically into and become
exchangeable for 27.6425 shares of AWS Common Stock;
(v) each share of TeleCorp Series E Preferred Stock, par value
$0.01 per share, issued and outstanding immediately prior to the Effective
Time (other than any shares to be canceled pursuant to Section 1.7 or the
Dissenting Shares) shall be converted automatically into and become
exchangeable for one share of a new series of Preferred Stock of AWS to be
designated as Series E Preferred Stock of AWS, having terms substantially
as set forth in the form of the Series E Preferred Certificate of
Designation attached as Exhibit B hereto (together with the AWS Series C
Preferred Stock, the "AWS Preferred Stock"; the AWS Common Stock and the
AWS Preferred Stock, the "AWS Capital Stock");
(vi) each share of TeleCorp Series F Preferred Stock, par value
$0.01 per share, issued and outstanding immediately prior to the Effective
Time (other than any shares to be canceled pursuant to Section 1.7 or the
Dissenting Shares) shall be converted automatically into and become
exchangeable for .9 shares of AWS Common Stock; and
(vii) each share of TeleCorp Series G Preferred Stock, par value
$0.01 per share, issued and outstanding immediately prior to the Effective
Time (other than any shares to be canceled pursuant to Section 1.7 or the
Dissenting Shares) shall be converted automatically into and become
exchangeable for .9 shares of AWS Common Stock.
(c) As of the Effective Time, all shares of TeleCorp Capital Stock
shall no longer be outstanding and shall automatically be deemed canceled and
shall cease to exist, and each holder of a certificate representing any such
shares shall cease to have any rights with respect thereto, except the right to
receive shares of the applicable AWS Capital Stock as specified in Section 1.6
(the "Merger Consideration"), and any cash, in lieu of fractional shares to be
issued or paid in consideration therefor upon surrender of such certificate in
accordance with Section 1.10 hereof without interest. The number of shares of
AWS Capital Stock into which shares of each class of TeleCorp Capital Stock are
converted in accordance with Section 1.6 shall be, with respect to such class,
the "Exchange Ratio."
1.7 Cancellation of Certain Shares; Conversion of Merger Sub Stock.
(a) At the Effective Time, each share of TeleCorp Capital Stock held
in the treasury of TeleCorp or owned by AWS immediately prior to the Effective
Time shall be canceled and extinguished without any conversion thereof and no
consideration shall be delivered in exchange therefor.
(b) Each share of common stock of Merger Sub issued and outstanding
immediately prior to the Effective Time shall be converted into and exchanged
for one share of common stock of the Surviving Corporation.
1.8 Stock Options; Restricted Stock.
(a) At the Effective Time, all options (the "Outstanding Employee
Options") to purchase shares of TeleCorp Common Stock then outstanding and
unexercised under the TeleCorp PCS, Inc. 2000 Employee, Director and Consultant
Stock Plan, the TeleCorp PCS, Inc. 1999 Stock Option Plan, as amended to the
date hereof, the Amended and Restated Tritel, Inc. 1999 Stock Option Plan, and
the Amended and Restated Tritel, Inc. 1999 Stock Option Plan for Non-employee
Directors (the "TeleCorp Option Plans"), whether or not then vested or
exercisable, by virtue of the Merger and without any action on the part of the
holder thereof, shall no longer be options to acquire TeleCorp Common Stock and
shall automatically become options to acquire AWS Common Stock with such terms
as provided in Section 1.8(b).
(b) At the Effective Time, each such Outstanding Employee Option
shall continue to have, and be subject to, the same terms and conditions set
forth in the TeleCorp Option Plans, option agreements thereunder and other
relevant documentation immediately prior to the Effective Time, except that such
Outstanding Employee Options will cease to represent an option to purchase
shares of TeleCorp Common Stock and will be automatically converted into an
option to purchase that number of whole shares of AWS Common Stock equal to the
product of (i) the number of shares of TeleCorp Common Stock that were
purchasable under such Outstanding Employee Options immediately prior to the
Effective Time and (ii) the applicable Exchange Ratio, rounded up to the nearest
whole number of shares of AWS Common Stock. The per-share exercise price for the
shares of AWS Common Stock issuable upon exercise of such converted Outstanding
Employee Options will be equal to the quotient determined by dividing (x) the
exercise price per share of TeleCorp Common Stock at which such Outstanding
Employee Options were exercisable immediately prior to the Effective Time by (y)
the applicable Exchange Ratio, and rounding the resulting exercise price to the
nearest whole cent.
(c) At the Effective Time, all shares of restricted and unvested
TeleCorp Common Stock ("Restricted Shares") granted under any of the TeleCorp
Option Plans or otherwise, which are outstanding and subject to restriction as
of the Effective Time, shall, without any further action on the part of the
holders thereof, automatically and immediately be converted into a number of
restricted shares of AWS Common Stock ("AWS Restricted Shares") equal to the
product of (i) the number of Restricted Shares held by the grantee immediately
prior to the Effective Time and (ii) the applicable Exchange Ratio. Following
the Effective Time, each AWS Restricted Share will otherwise continue to be
subject to the same terms and conditions set forth in the TeleCorp Option Plans,
restricted stock agreements thereunder and any other relevant documentation
immediately prior to the Effective Time. At the Effective Time, AWS shall assume
all of the further obligations of TeleCorp under the TeleCorp PCS, Inc. 1998
Restricted Stock Plan, which was assumed by TeleCorp on November 13, 2000.
(d) AWS or one of its Affiliates shall reserve for issuance a
sufficient number of shares of AWS Common Stock for delivery upon exercise of
Outstanding Employee Options. As soon as practicable after the Effective Time,
AWS shall file a registration statement on Form S-8 (or any successor form or
other appropriate form) under the Securities Act covering the shares of AWS
Common Stock issuable upon the exercise of the Outstanding Employee Options
assumed by AWS, and shall use all its reasonable efforts to cause such
registration statement to become effective as soon thereafter as practicable and
to maintain such registration in effect until the exercise or expiration of such
assumed Outstanding Employee Options.
(e) Notwithstanding the foregoing, the number of shares and the per
share exercise price of each Outstanding Employee Option that is intended to be
an "incentive stock option " (as defined in Section 422 of the Code) shall be
adjusted in accordance with the requirements of Section 422 of the Code.
(f) TeleCorp shall take all steps necessary prior to the Effective
Time to ensure that no individual shall have the right to exercise any
Outstanding Employee Options (or other TeleCorp equity awards) for TeleCorp
Common Stock following the Effective Time.
1.9 Adjustments. If at any time during the period between the date
of this Agreement and the Effective Time, (a) any change in the outstanding
shares of TeleCorp Capital Stock or AWS Common Stock shall occur by reason of
any reclassification, recapitalization, stock split or combination, exchange or
readjustment of shares, or any similar transaction, or any stock dividend
thereon with a record date during such period, or (b) if the representations set
forth in Section 2.3(a), Section 2.3(b) or the first sentence of Section 2.3(c)
shall not be true and correct and, solely in the case of clause (b) AWS elects
to do so, the Merger Consideration shall be appropriately adjusted to provide
the holders of shares of TeleCorp Capital Stock or AWS, as the case may be, the
same economic effect as contemplated by this Agreement prior to such event or in
the absence of such failure to be true and correct, as the case may be.
1.10 Fractional Shares. No fraction of a share of AWS Common Stock
shall be issued, but in lieu thereof each holder of shares of TeleCorp Capital
Stock who would otherwise be entitled to a fraction of a share of AWS Common
Stock (after aggregating all fractional shares of AWS Common Stock to be
received by such holder) shall receive from the Exchange Agent (as defined
below) in lieu of such fractional shares of AWS Common Stock, an amount of cash
(rounded to the nearest whole cent and without interest) representing such
holder's proportionate interest, if any, in the net proceeds from the sale by
the Exchange Agent in one or more transactions (which sale transactions shall be
made at such times, in such manner and on such terms as the Exchange Agent shall
determine in its reasonable discretion) on behalf of all such holders of the
aggregate of the fractional shares of AWS Common Stock which would otherwise
have been issued (the "Excess Shares"). The sale of the Excess Shares by the
Exchange Agent shall be executed on the New York Stock Exchange and shall be
executed in round lots to the extent practicable. Until the net proceeds of such
sale or sales have been distributed to the holders of TeleCorp Capital Stock,
the Exchange Agent will hold such proceeds in trust for the holders of TeleCorp
Capital Stock. AWS shall pay or cause to be paid all commissions, transfer taxes
and other out-of-pocket transaction costs, including, without limitation, the
expenses and compensation of the Exchange Agent, incurred in connection with
such sale of the Excess Shares. AWS may decide, at its sole option, exercised
prior to the Effective Time, in lieu of the issuance and sale of Excess Shares
that AWS shall pay or cause to be paid to the Exchange Agent an amount
sufficient for the Exchange Agent to pay each holder of TeleCorp Capital Stock
the amount such holder would have received pursuant to the foregoing assuming
that the sales of AWS Common Stock were made at a price equal to the average of
the closing bid prices of AWS Common Stock on the New York Stock Exchange, for
the ten consecutive trading days immediately following the Effective Time and,
in such case, all references herein to the cash proceeds of the sale of the
Excess Shares and similar references shall be deemed to mean and refer to the
payments calculated as set forth in this sentence. In such event, Excess Shares
shall not be issued or otherwise transferred to the Exchange Agent. As soon as
practicable after the determination of the amount of cash, if any, to be paid to
holders of TeleCorp Capital Stock in lieu of any fractional shares of AWS Common
Stock, the Exchange Agent shall make available such amounts to such holders of
shares of the applicable TeleCorp Capital Stock without interest.
1.11 Surrender of Certificates.
(a) Exchange Agent. Prior to the Effective Time, AWS shall designate
a bank or trust company to act as exchange agent (the "Exchange Agent") in
connection with the Merger.
(b) AWS to Provide Capital Stock. When and as needed, AWS shall use
reasonable best efforts to make available to the Exchange Agent for exchange in
accordance with this Article I, through such reasonable procedures as AWS may
adopt, the Merger Consideration.
(c) Exchange Procedures. Promptly after the Effective Time (but in
no event later than five days after the Effective Time), AWS shall cause to be
mailed to each holder of record of a certificate or certificates (the
"Certificates") which immediately prior to the Effective Time represented
outstanding shares of TeleCorp Capital Stock whose shares were converted into
the right to receive shares of AWS Capital Stock pursuant to Section 1.6, a
letter of transmittal (which shall specify that delivery shall be effected, and
risk of loss and title to the Certificates shall pass, only upon delivery of the
Certificates to the Exchange Agent and shall be in such form and have such other
provisions as TeleCorp may reasonably specify) and instructions for use in
effecting the surrender of the Certificates in exchange for certificates
representing shares of AWS Capital Stock. Upon surrender of a Certificate for
cancellation to the Exchange Agent, together with such letter of transmittal,
duly completed and validly executed in accordance with the instructions thereto,
the holder of such Certificate shall be entitled to receive in exchange therefor
a certificate representing the number and type of shares of AWS Capital Stock
or, as the case may be, payment in lieu of fractional shares which such holder
has the right to receive pursuant to Section 1.10, and the Certificate so
surrendered shall forthwith be canceled. Until so surrendered, each outstanding
Certificate that, prior to the Effective Time, represented shares of TeleCorp
Capital Stock shall be deemed from and after the Effective Time, for all legal
purposes, to evidence only the right to receive the number of shares of AWS
Capital Stock into which the holder of such shares of TeleCorp Capital Stock is
entitled and, as the case may be, the right to receive an amount in cash in lieu
of the issuance of any fractional shares in accordance with Section 1.10. Any
portion of the shares of AWS Capital Stock and cash deposited with the Exchange
Agent pursuant to Section 1.11(b) which remains undistributed to the holders of
Certificates representing shares of TeleCorp Capital Stock for six months after
the Effective Time shall be delivered to AWS, upon demand, and any holders of
shares of TeleCorp Capital Stock who have not theretofore complied with the
provisions of this Article I shall thereafter look only to AWS and only as
general creditors thereof for payment of their claim for AWS Capital Stock, any
cash in lieu of fractional shares and any dividends or distributions with
respect to AWS Capital Stock to which such holders may then be entitled.
(d) Distributions With Respect to Unexchanged Shares. No dividends
or other distributions declared or made after the Effective Time with respect to
AWS Capital Stock with a record date after the Effective Time will be paid to
the holder of any unsurrendered Certificate with respect to the shares of AWS
Capital Stock represented thereby until the holder of record of such Certificate
shall surrender such Certificate. Subject to applicable law, following the
surrender of any such Certificate, there shall be paid to the record holder of
the certificates representing shares of AWS Capital Stock issued in exchange
therefor, without interest, at the time of such surrender, the amount of
dividends or other distributions with a record date after the Effective Time
theretofore paid with respect to such shares of AWS Capital Stock.
(e) Transfers of Ownership. If any certificate for shares of AWS
Capital Stock is to be issued in a name other than that in which the Certificate
surrendered in exchange therefor is registered in the stock register of
TeleCorp, it shall be a condition of the issuance thereof that the Certificate
so surrendered shall be properly endorsed and otherwise be in proper form for
transfer and that the stockholder requesting such exchange shall have paid to
AWS, or any agent designated by it, any transfer or other taxes required by
reason of the issuance of a certificate for shares of AWS Capital Stock in any
name other than that of the registered holder of the Certificate surrendered, or
established to the reasonable satisfaction of AWS or any agent designated by it
that such tax has been paid or is otherwise not payable.
(f) No Liability. Notwithstanding anything to the contrary in this
Agreement, none of the Exchange Agent, AWS or the Surviving Corporation shall be
liable to a holder of shares of TeleCorp Capital Stock or any amount properly
paid to a public official pursuant to any applicable abandoned property, escheat
or similar law.
(g) Withholding of Tax. Either AWS or the Exchange Agent shall be
entitled to deduct and withhold from the consideration otherwise payable
pursuant to this Agreement to any holder of shares of TeleCorp Capital Stock
such amounts as AWS (or any Affiliate thereof) or the Exchange Agent shall
determine in good faith they are required to deduct and withhold with respect to
the making of such payment under the Code or any provision of any applicable
state, local or foreign tax law. To the extent that amounts are so withheld by
AWS or the Exchange Agent, such withheld amounts will be treated for all
purposes of this Agreement as having been paid to the holder of the shares of
TeleCorp Capital Stock in respect of whom such deduction and withholding were
made by AWS.
1.12 Further Ownership Rights in Shares. All shares of AWS Capital
Stock issued upon the surrender for exchange of shares of TeleCorp Capital Stock
in accordance with the terms of this Article I (including any cash paid in
respect thereof) shall be deemed to have been issued in full satisfaction of all
rights pertaining to such shares of TeleCorp Capital Stock, and there shall be
no further registration of transfers on the records of either AWS or the
Surviving Corporation of shares of capital stock of TeleCorp which were
outstanding immediately prior to the Effective Time. If, after the Effective
Time, Certificates are presented to either AWS or the Surviving Corporation for
any reason, they shall be canceled and exchanged as provided in this Article I.
1.13 Closing. Unless this Agreement shall have been terminated and
the transactions contemplated by this Agreement abandoned pursuant to the
provisions of Article VI, and subject to the provisions of Article V, the
closing of the Merger (the "Closing") shall take place at 10:00 a.m. (eastern
standard time) on a date (the "Closing Date") to be mutually agreed upon by the
parties, which date shall be not later than the third business day after all the
conditions set forth in Article V (excluding, but subject to the satisfaction or
waiver of, conditions that, by their nature, cannot be satisfied prior to the
Closing Date) shall have been satisfied or waived, unless another time and/or
date is agreed to in writing by the parties. The Closing shall take place at the
offices of Wachtell, Lipton, Xxxxx & Xxxx, 00 Xxxx 00xx Xxxxxx, Xxx Xxxx, XX,
unless another place is agreed to by the parties.
1.14 Lost, Stolen or Destroyed Certificates. In the event any
Certificates evidencing shares of TeleCorp Capital Stock shall have been lost,
stolen or destroyed, the Exchange Agent shall issue in exchange for such lost,
stolen or destroyed Certificates, upon the making of an affidavit of that fact
by the holder thereof in form and substance reasonably acceptable to AWS, such
shares of AWS Capital Stock to which the holder of such Certificate would
otherwise be entitled to pursuant to the provisions of Section 1.6 and cash for
fractional shares, if any, as may be required pursuant to Section 1.10;
provided, however, that AWS may, in its discretion and as a condition precedent
to the issuance thereof, require the owner of such lost, stolen or destroyed
Certificates to deliver a bond in such sum as it may reasonably direct as
indemnity against any claim that may be made against AWS or the Exchange Agent
with respect to the Certificates alleged to have been lost, stolen or destroyed.
1.15 Follow-On Merger. In the event that either of the tax opinions
required by Section 5.2(b) and 5.3(b) could otherwise not be delivered, AWS
shall cause the Surviving Corporation to be merged with and into AWS immediately
after the Effective Time (the "Follow-On Merger").
1.16 Dissenting Shares.
(a) Notwithstanding any provision of this Agreement to the contrary,
shares of TeleCorp Capital Stock (other than the TeleCorp Class A Voting Common
Stock, par value $0.01 per share) that are outstanding immediately prior to the
Effective Time and that are held by stockholders who shall have neither voted in
favor of the Merger nor consented thereto in writing and who shall have demanded
properly in writing appraisal for such shares in accordance with Section 262 of
the DGCL (collectively, the "Dissenting Shares") shall not be converted into, or
represent the right to receive, the Merger Consideration. Such stockholders
shall be entitled to receive payment of the appraised value of such shares held
by them in accordance with the provisions of such Section 262, except that all
Dissenting Shares held by stockholders who shall have failed to perfect or who
effectively shall have withdrawn or lost their rights to appraisal of such
shares under such Section 262 shall thereupon be deemed to have been converted
into, and to have become exchangeable for, as of the Effective Time, the right
to receive the Merger Consideration, without any interest thereon, upon
surrender, in the manner provided in Section 1.11, of the certificate or
certificates that formerly evidenced such shares.
(b) TeleCorp shall give AWS (i) prompt notice of any demands for
appraisal received by TeleCorp, withdrawals of such demands, and any other
instruments served pursuant to the DGCL and received by TeleCorp and (ii) the
opportunity to direct all negotiations and proceedings with respect to demands
for appraisal under the DGCL. TeleCorp shall not, except with the prior written
consent of AWS, make any payment with respect to any demands for appraisal or
offer to settle or settle any such demands.
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF TELECORP
Except as set forth in the TeleCorp Disclosure Schedule delivered to
AWS concurrently herewith (the "TeleCorp Disclosure Schedule"), TeleCorp, on
behalf of itself and its Subsidiaries, represents and warrants to AWS that the
statements contained in this Article II are true, complete and correct. The
TeleCorp Disclosure Schedule shall be arranged in paragraphs corresponding to
the numbered and lettered paragraphs contained in this Article II, and the
disclosure in any paragraph shall qualify only the corresponding paragraph of
this Article II. As used in this Agreement, a "TeleCorp Material Adverse Effect"
means any change, event, occurrence, effect or state of facts (a) that is
materially adverse to or materially impairs (i) the business, assets (including
intangible assets), liabilities, financial condition or results of operations of
TeleCorp and its Subsidiaries, taken as a whole, or (ii) the ability of TeleCorp
to perform its obligations under this Agreement, or (b) prevents consummation of
any of the transactions contemplated by this Agreement; provided that none of
the following shall be considered a Material Adverse Effect except to the extent
TeleCorp is affected in a materially disproportionate manner as compared to
other wireless telecommunications service providers: (x) changes in general
economic conditions in the United States, (y) conditions affecting the wireless
telecommunications services industry generally, and (z) any changes resulting
from the announcement of the Merger.
2.1 Organization and Qualification; Subsidiaries.
(a) TeleCorp is a corporation duly incorporated, validly existing
and in good standing under the laws of the State of Delaware and has all the
requisite corporate power and authority necessary to own, lease and operate its
properties and to carry on its business as it is now being conducted. TeleCorp
is duly qualified or licensed as a foreign corporation to do business, and is in
good standing, in each jurisdiction where the character of the properties owned,
leased or operated by it or the nature of its activities makes such
qualification or licensing necessary, except where the failure to be so
qualified would not, individually or in the aggregate, reasonably be expected to
have a TeleCorp Material Adverse Effect.
(b) All of the shares of capital stock of each Subsidiary of
TeleCorp are owned by TeleCorp or by a Subsidiary of TeleCorp (other than
director's qualifying shares in the case of foreign Subsidiaries), and are
validly issued, fully paid and non-assessable, and there are no outstanding
subscriptions, options, calls, contracts, voting trusts, proxies or other
commitments, understandings, restrictions, arrangements, rights or warrants with
respect any such Subsidiaries capital stock.
(c) Each Subsidiary of TeleCorp is a legal entity, duly incorporated
or organized, validly existing and in good standing under the laws of its
respective jurisdiction of incorporation or organization and has all the
requisite power and authority necessary to own, lease and operate its properties
and to carry on its business as it is now being conducted. Each Subsidiary of
TeleCorp is duly qualified or licensed as a foreign corporation to do business,
and is in good standing, in each jurisdiction where the character of the
properties owned, leased or operated by it or the nature of its activities makes
such qualification or licensing necessary, except where the failure to be so
qualified would not, individually or in the aggregate, reasonably be expected to
have a TeleCorp Material Adverse Effect.
2.2 Certificate of Incorporation; By-laws. TeleCorp has heretofore
made available to AWS a true, complete and correct copy of its and each of its
Subsidiaries' respective Certificate of Incorporation and By-laws (or other
equivalent organizational or constitutive documents), each as amended or
restated to date. Each such Certificate of Incorporation and By-laws (or other
equivalent organizational documents) of TeleCorp and each of its Subsidiaries
are in full force and effect. Neither TeleCorp nor any of its Subsidiaries is in
violation of any of the provisions of its Certificate of Incorporation or
By-laws or other equivalent organizational documents.
2.3 Capitalization.
(a) The authorized capital of TeleCorp consists of: (i)
1,934,463,093 shares of TeleCorp Common Stock, consisting of: (A) 1,108,550,000
shares of TeleCorp Class A Voting Common Stock, (B) 808,550,000 shares of
TeleCorp Class B Non-Voting Common Stock, (C) 313,000 shares of TeleCorp Class C
Common Stock, (D) 1,047,000 shares of TeleCorp Class D Common Stock, (E)
4,000,000 shares of TeleCorp Class E Common Stock, (F) 12,000,000 shares of
TeleCorp Class F Common Stock, and (G) 3,093 shares of TeleCorp Voting
Preference Common Stock; (ii) 20,000,000 shares of TeleCorp Preferred Stock,
consisting of: (A) 100,000 shares of TeleCorp Series A Convertible Preferred
Stock, (B) 200,000 shares of TeleCorp Series B Preferred Stock, (C) 215,000
shares of TeleCorp Series C Preferred Stock, (D) 50,000 shares of TeleCorp
Series D Preferred Stock, (E) 30,000 shares of TeleCorp Series E Preferred
Stock, (F) 15,450,000 shares of TeleCorp Series F Preferred Stock, (G) 100,000
shares of TeleCorp Series G Preferred Stock, (H) 200,000 shares of TeleCorp
Series H Preferred Stock, (I) 300,000 shares of TeleCorp Series I Preferred
Stock, and (J) 3,355,000 undesignated shares.
(b) As of October 7, 2001, 2001: (i) 180,960,930.01 shares of
TeleCorp Common Stock were issued and outstanding, which consisted of: (A)
179,779,632 shares of TeleCorp Class A Voting Common Stock, (B) no shares of
TeleCorp Class B Non-Voting Common Stock, (C) 283,813 shares of TeleCorp Class C
Common Stock, (D) 851,429 shares of TeleCorp Class D Common Stock, (E) 5,245.70
shares of TeleCorp Class E Common Stock, (F) 37,717.31 shares of TeleCorp Class
F Common Stock, and (G) 3,093 shares of TeleCorp Voting Preference Common Stock;
(ii) 15,433,244.82 shares of TeleCorp Preferred Stock were issued and
outstanding, which consisted of: (A) 97,472.84 shares of TeleCorp Series A
Preferred Stock, (B) 90,666.33 shares of TeleCorp Series B Preferred Stock, (C)
210,608 shares of TeleCorp Series C Preferred Stock, (D) 49,916.98 shares of
TeleCorp Series D Preferred Stock, (E) 25,428.57 shares of TeleCorp Series E
Preferred Stock, (F) 14,912,778 shares of TeleCorp Series F Preferred Stock, (G)
46,374.10 shares of TeleCorp Series G Preferred Stock, (H) no shares of TeleCorp
Series H Preferred Stock, and (I) no shares of TeleCorp Series I Preferred
Stock; (iii) 281,525 shares of TeleCorp Common Stock were held in treasury of
TeleCorp or any of its Subsidiaries; (iv) no shares of TeleCorp Capital Stock
were held by any Subsidiary of TeleCorp; (v) 361,744 shares of TeleCorp Class A
Voting Stock and 649.76 shares of TeleCorp Series E Preferred Stock were
reserved for issuance pursuant to the TeleCorp PCS, Inc. 2000 Employee, Director
and Consultant Stock Plan and TeleCorp PCS, Inc. 1998 Restricted Stock Plan, as
amended; and (vi) there were outstanding employee and non-employee options in
the amount set forth in Section 2.3(b) of the TeleCorp Disclosure Schedule (the
"TeleCorp Options"), with the exercise price, vesting schedule and name of each
holder of such options and the amount of options held by each such holder
specified in Section 2.3(b) of the TeleCorp Disclosure Schedule, and 22,703,376
shares of TeleCorp Class A Common Stock were reserved for issuance in respect
thereof. None of the outstanding shares of TeleCorp Capital Stock are subject
to, nor were they issued in violation of, any purchase option, call option,
right of first refusal, preemptive right, subscription right or any similar
right.
(c) Except as set forth above, no shares of voting or non-voting
capital stock or other securities or equity interests of TeleCorp were or are
issued, reserved for issuance or outstanding. All outstanding shares of TeleCorp
Capital Stock are, and all shares which may be issued upon the exercise of
TeleCorp Options will be, when issued, duly authorized, validly issued
(including under the Securities Act), fully paid and non-assessable and not
subject to any kind of preemptive (or similar) rights. There are no bonds,
debentures, notes or other indebtedness of TeleCorp with voting rights (or
convertible into, or exchangeable for, securities with voting rights) on any
matters on which stockholders of TeleCorp may vote.
(d) All of the outstanding shares of capital stock or other security
or equity interests of each of TeleCorp's Subsidiaries have been duly
authorized, validly issued, fully paid and non-assessable, are not subject to,
and were not issued in violation of any preemptive (or similar) rights, and are
owned, of record and beneficially, by TeleCorp or one of its direct or indirect
Subsidiaries, free and clear of any and all Liens whatsoever. There are no
restrictions of any kind which prevent the payment of dividends, where
applicable, by any of TeleCorp's Subsidiaries, and neither TeleCorp nor any of
its Subsidiaries is subject to any obligation or requirement to provide funds
for or to make any investment (in the form of a loan or capital contribution) to
or in any Person.
(e) Section 2.3(e) of the TeleCorp Disclosure Schedule sets forth a
true, complete and correct list of all securities, options, warrants, calls,
rights, commitments, agreements, arrangements or undertakings of any kind
(contingent or otherwise) to which TeleCorp or any of its Subsidiaries is a
party or by which any of them is bound obligating TeleCorp or any of its
Subsidiaries to issue, deliver or sell, or cause to be issued, delivered or
sold, additional shares of capital stock or other voting securities of TeleCorp
or of any of its Subsidiaries, whether upon conversion, exchange or otherwise,
or obligating TeleCorp or any of its Subsidiaries to issue, grant, extend or
enter into any such security, option, warrant, call, right, commitment,
agreement, arrangement or undertaking (other than the TeleCorp Options) and
specifying the material terms of each such security, option, warrant, call,
right, commitment, agreement, arrangement or undertaking including the
applicable exercise price or purchase price and the name of the person or entity
to whom each such security, option, warrant, call, right, commitment, agreement,
arrangement or undertaking was issued and other than as set forth in Section
2.3(b) or 2.3(e) of the TeleCorp Disclosure Schedule, there are no such
securities, options, warrants, calls, rights, commitments, agreements,
arrangements or undertakings outstanding. There are no outstanding contractual
obligations of TeleCorp or any of its Subsidiaries to repurchase, redeem or
otherwise acquire any shares of capital stock (or options to acquire any such
shares) or other security or equity interest of TeleCorp or its Subsidiaries.
There are not outstanding any stock-appreciation rights, security-based
performance units, "phantom" stock or other security rights or other agreements,
arrangements or commitments of any character (contingent or otherwise) pursuant
to which any Person is or may be entitled to receive any payment or other value
based on the revenues, earnings or financial performance, stock price
performance or other attribute of TeleCorp or any of its Subsidiaries or assets
or calculated in accordance therewith (other than ordinary course payments or
commissions to sales representatives of TeleCorp based upon revenues generated
by them without augmentation as a result of the transactions contemplated
hereby) or to cause TeleCorp or any of its Subsidiaries to file a registration
statement under the Securities Act of 1933, as amended (the "Securities Act"),
or which otherwise relate to the registration of any securities of TeleCorp or
its Subsidiaries.
(f) Except for the Voting Agreements and the Stockholders Agreement,
dated November 13, 2000 by and among TeleCorp, AWS and the other parties
specified therein (the "Stockholders Agreement"), and such other agreements to
which AWS is a party, there are no voting trusts, proxies or other agreements,
commitments or understandings of any character to which TeleCorp or any of its
Subsidiaries or, to the knowledge of TeleCorp, any of the stockholders of
TeleCorp, is a party or by which any of them is bound with respect to the
issuance, holding, acquisition, voting or disposition of any shares of capital
stock or other security or equity interest of TeleCorp or any of its
Subsidiaries.
2.4 Authority; Enforceability. TeleCorp has all necessary corporate
power and authority to execute and deliver this Agreement, Amendment No. 1 to
the Stockholders Agreement (the "Stockholders Agreement Amendment"), and the
Transfer Agreement (collectively, the "Related Agreements") and to perform its
obligations hereunder and thereunder and, assuming the requisite stockholder
approval is received, to consummate the transactions contemplated hereby and
thereby. The execution and delivery by TeleCorp of this Agreement and each
Related Agreement to which it is a party, the performance of its obligations
hereunder and thereunder, and the consummation by TeleCorp of the transactions
contemplated hereby and thereby, have been duly and validly authorized by all
corporate action and no other corporate proceedings on the part of TeleCorp are
necessary to authorize this Agreement or any Related Agreement or to consummate
the transactions so contemplated, other than the Required Stockholder Approval.
Each of this Agreement and each Related Agreement has been duly and validly
executed and delivered by TeleCorp and, assuming the due authorization,
execution and delivery thereof by all other parties to each such agreement,
constitutes a legal, valid and binding obligation of TeleCorp in accordance with
its terms, subject to bankruptcy, insolvency, reorganization, moratorium and
similar laws relating to or affecting creditors generally or by general
equitable principles (regardless of whether such enforceability is considered in
a proceeding in equity or law).
2.5 Board Recommendation; Required Vote. A majority of the
Disinterested Directors have, and the full Board of Directors of TeleCorp has,
at a meeting duly called and held (i) approved and declared advisable this
Agreement and approved each Related Agreement, (ii) determined that the
transactions contemplated hereby and thereby are advisable, fair to and in the
best interests of the holders of TeleCorp Capital Stock, (iii) resolved to
recommend adoption of this Agreement, the Merger, and the other transactions
contemplated hereby and thereby to the stockholders of TeleCorp and (iv)
directed that this Agreement be submitted to the stockholders of TeleCorp for
their approval and authorization (the recommendations referred to in this
sentence, the "Directors' Recommendation"). The affirmative vote of a majority
of the voting power of all outstanding shares of TeleCorp Class A Voting Common
Stock, TeleCorp Class C Common Stock, TeleCorp Class D Common Stock, TeleCorp
Class E Common Stock, TeleCorp Class F Common Stock, and TeleCorp Voting
Preference Common Stock, TeleCorp Series A Convertible Preferred Stock, TeleCorp
Series B Preferred Stock, TeleCorp Series C Preferred Stock, TeleCorp Series D
Preferred Stock, TeleCorp Series E Preferred Stock, and TeleCorp Series F
Preferred Stock, voting together as one class in accordance with TeleCorp's
Certificate of Incorporation, are the only votes of the holders of any class or
series of capital stock of TeleCorp necessary to approve and authorize this
Agreement, the Merger and the Related Agreements and the other transactions
contemplated hereby and thereby in their capacity as stockholders of TeleCorp
(such vote, the "Required Stockholder Approval"). As of the date hereof, the
Persons who are signatories to the Voting Agreements in the aggregate possess
sufficient voting power to cause the Required Stockholder Approval to be given
without the vote of any other stockholder of TeleCorp. The Stockholders
Agreement Amendment was and is effective to amend the Stockholders Agreement in
the manner and to the extent provided for in the Stockholders Agreement
Amendment.
2.6 No Conflict; Required Filings and Consents.
(a) The execution and delivery by TeleCorp of this Agreement and the
Related Agreements do not, and the performance of this Agreement and the Related
Agreements will not, (i) conflict with or violate the Certificate of
Incorporation or By-laws or other equivalent organizational or constitutive
documents of TeleCorp or any of its Subsidiaries, (ii) conflict with or violate
any Law, Regulation or Order in each case applicable to TeleCorp or any of its
Subsidiaries or by which any of their respective properties is bound or
affected, or (iii) result in any breach or violation of or constitute a default
(or an event that with notice or lapse of time or both would become a default)
under, or impair TeleCorp's or any of its Subsidiaries' rights or alter the
rights or obligations of any third party under, or give to others any rights of
termination, amendment, acceleration or cancellation of, or result in the
creation of a Lien on any of the properties or assets of TeleCorp or any of its
Subsidiaries pursuant to, any note, bond, mortgage, indenture, contract,
agreement, lease, license, permit, franchise or other instrument or obligation
to which TeleCorp or any of its Subsidiaries is a party or by which TeleCorp or
any of its Subsidiaries or its or any of their respective properties is bound or
affected, except in the case of clauses (ii) or (iii) above, for any such
conflicts, breaches, violations, defaults or other occurrences that would not
(x) individually or in the aggregate, reasonably be expected to have a TeleCorp
Material Adverse Effect, (y) prevent or materially impair or delay the
consummation of the transactions contemplated by this Agreement and the Related
Agreements or (z) individually, or in the aggregate, reasonably be expected to
have a material adverse effect on the value of TeleCorp's Capital Stock.
(b) The execution and delivery by TeleCorp of this Agreement and the
Related Agreements do not, and the performance of this Agreement and the Related
Agreements, will not, require TeleCorp or any of its Subsidiaries to obtain any
approval of any Person or approval of, observe any waiting period imposed by, or
make any filing with or notification to or seek any approval or authorization
from any Governmental Authority, domestic or foreign, except for (i) compliance
with applicable requirements of the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), the pre-merger notification requirements of the
Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976, as amended (the "HSR
Act"), the Communications Act of 1934, as amended, including, without
limitation, as amended by the Telecommunications Act of 1996 (the
"Communications Act") and any rules, regulations or policies promulgated by the
Federal Communications Commission (the "FCC"), state public utility,
telecommunications or public service laws, (ii) the filing of the Certificate of
Merger in accordance with the DGCL and/or (iii) where the failure to obtain such
approvals, or to make such filings or notifications, would not, individually or
in the aggregate, reasonably be expected to have a TeleCorp Material Adverse
Effect. The approval or authorization required to be obtained from the FCC
pursuant to the Communications Act and/or the rules and regulations of the FCC,
are referred to herein as the "Required TeleCorp Governmental Approvals").
2.7 Material Agreements. (a) Each agreement, contract or commitment
that is of a type which is required, pursuant to Items 404 or 601 of Regulation
S-K promulgated by the Securities and Exchange Commission (the "SEC"), to be
disclosed or included as an exhibit to a TeleCorp SEC Report filed on or after
December 31, 2000 has been so disclosed or so included in TeleCorp's Annual
Report on Form 10-K for the fiscal year ended December 31, 2000, or one of its
Quarterly Reports on Form 10-Q for the quarters ended March 31, 2001 or June 30,
2001 (any such agreement required to be so disclosed or included, together with
any agreements actually disclosed or included, the "TeleCorp SEC Agreements").
Except as entered into after the date hereof without violation of this
Agreement, Section 2.7(a) of the TeleCorp Disclosure Schedule sets forth a true
and correct list of (i) all uncompleted contracts, arrangements, agreements or
understandings with vendors or otherwise for the purchase of equipment or
services involving the payment of $3 million or more in any 12 month period or
$8 million in the aggregate; and (ii) all contracts, arrangements, agreements or
understandings to purchase or acquire any rights under any FCC License or other
service licenses or permits; and (iii) all contracts, arrangements, agreements
or understandings to purchase, acquire, dispose or transfer any tower or
wireless system or part thereof or cell site or any other local service or
access system (including any shares of capital stock of any Subsidiary holding
any such interest) or material business enterprise or operation. The TeleCorp
SEC Agreements, together with the agreements required to be disclosed in Section
2.7(a) of the TeleCorp Disclosure Schedule are referred to herein as the
"TeleCorp Material Contracts". TeleCorp has previously made available to AWS
true and complete copies of each of the foregoing agreements.
(b) Neither TeleCorp nor any of its Subsidiaries has breached or
violated any provision of, or committed or failed to perform any act which with
or without notice, lapse of time or both would constitute a default under any of
the provisions of, or received in writing any claim or threat that it has
breached or is in default under, any of the terms or conditions of any TeleCorp
Material Contract in such a manner as would permit any other party to cancel or
terminate the same or would permit any other party to collect material damages
from TeleCorp or any of its Subsidiaries under any TeleCorp Material Contract.
Each TeleCorp Material Contract (i) is in full force and effect, (ii) is a valid
and binding obligation of TeleCorp or such Subsidiary, subject to bankruptcy,
insolvency, reorganization, moratorium and similar laws relating to or affecting
creditors generally or by general equitable principles (regardless of whether
such enforceability is considered in a proceeding in equity or law) and, to the
knowledge of TeleCorp, of each other party thereto, and (iii) is enforceable
against TeleCorp or such Subsidiary in accordance with its terms, and, to the
knowledge of TeleCorp, enforceable against each other party thereto, and such
TeleCorp Material Contracts will continue to be valid, binding and enforceable
in accordance with their respective terms and in full force and effect
immediately following the consummation of the transactions contemplated hereby
with no alteration or acceleration or increase in fees or liabilities. Neither
TeleCorp nor any of its Subsidiaries is or is alleged to be and, to the
knowledge of TeleCorp, no other party is or is alleged to be in default under,
or in breach or violation of, any TeleCorp Material Contract, and no event has
occurred which (whether with or without notice or lapse of time or both) would
constitute such a default, breach or violation. No party to a TeleCorp Material
Contract has terminated or notified TeleCorp in writing of an intent to
materially reduce or terminate the amount of business with TeleCorp and its
Subsidiaries in the future, except as would not individually or in the
aggregate, reasonably be expected to have a TeleCorp Material Adverse Effect.
(c) There is no agreement, contract or understanding binding upon
TeleCorp or any of its Subsidiaries or any of their respective properties which
has had or could reasonably be expected to have the effect of prohibiting or
impairing any business or operations of AWS or any of its Affiliates (other than
TeleCorp or its Subsidiaries) or any business practice of AWS or any of its
Affiliates (other than TeleCorp or its Subsidiaries) as currently conducted.
Without limiting the generality of the foregoing, the exclusivity terms of each
of the General Agreement for Purchase of Personal Communications Systems and
Services, dated as of May 1, 1998, among Lucent Technologies Inc. and TeleCorp
PCS, Inc., and the Acquisition Agreement, dated as of December 30, 1998 among
Ericsson Inc., Tritel Finance, Inc. and Tritel Communications, Inc. do not apply
to or limit or bind TeleCorp or its Subsidiaries beyond December 30, 2005 and
May 1, 2003, respectively, and shall not be or purport to be applicable to, be
enforceable against, limit or bind AWS or any of Subsidiaries (other than the
Surviving Corporation) at any time.
(d) Section 2.7(d) of the TeleCorp Disclosure Schedule contains a
true and accurate list of (i) all contracts, arrangements, agreements or
understandings that are of the type that are required to be disclosed or
described pursuant to Item 404 of Regulation S-K, other than those that are
filed as an exhibit to a TeleCorp SEC Report filed prior to the date hereof, and
(ii) all agreements or understandings, whether written or oral, giving any
Person the right to require TeleCorp to register shares of capital stock or to
participate in any such registration.
2.8 Compliance. Each of TeleCorp and its Subsidiaries is in
compliance in all respects with, and is not in default or violation of, (i) its
Certificate of Incorporation and By-laws or other equivalent organizational
documents, or (ii) any note, bond, mortgage, indenture, contract, permit,
franchise or other instruments or obligations to which any of them are a party
or by which any of them or any of their respective assets or properties are
bound or affected, except, in the case of clause (ii), any such failures of
compliance, defaults and violations which would not, individually or in the
aggregate, reasonably be expected to have a TeleCorp Material Adverse Effect.
2.9 SEC Filings; Financial Statements.
(a) TeleCorp has timely and accurately filed all forms, reports,
schedules, statements and documents required to be filed by it with the SEC
since October 13, 1999 (the "TeleCorp SEC Reports") pursuant to the federal
securities Laws and the SEC regulations promulgated thereunder. Each of
TeleCorp's Subsidiaries that are obligated to file with the SEC has timely and
accurately filed all forms, reports, schedules, statements and documents
required to be filed by it with the SEC since October 13, 1999 (the "TeleCorp
Subsidiary SEC Reports") pursuant to the federal securities laws and the SEC
regulations promulgated thereunder. The TeleCorp SEC Reports and TeleCorp
Subsidiary SEC Reports were (i) prepared in accordance, and complied as of their
respective filing dates in all material respects, with the requirements of the
Exchange Act and the Securities Act and the rules and regulations promulgated
thereunder, and (ii) did not at the time they were filed (or if amended or
superseded by a filing prior to the date hereof, then on the date of such
filing) contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading.
(b) Each of the audited and unaudited consolidated financial
statements (including, in each case, any related notes and schedules thereto)
contained in the TeleCorp SEC Reports (i) complied in all material respects with
applicable accounting requirements and the regulations of the SEC with respect
thereto, (ii) were prepared in accordance with generally accepted accounting
principles ("GAAP") (except, in the case of unaudited statements, to the extent
otherwise permitted by Form 10-Q) applied on a consistent basis throughout the
periods involved (except as may be expressly described in the notes thereto) and
(iii) fairly and accurately present in all material respects the consolidated
financial position of TeleCorp and its Subsidiaries as at the respective dates
thereof and the consolidated results of its operations and cash flows for the
periods indicated, subject in the case of interim financial statements to normal
year-end adjustments.
2.10 Licenses and Authorizations.
(a) TeleCorp and its Subsidiaries hold all licenses, permits,
certificates, franchises, ordinances, registrations, or other rights,
applications and authorizations granted or issued by any Governmental Authority,
including, without limitation, the FCC or any state authority asserting
jurisdiction over TeleCorp, its Subsidiaries and their respective properties and
assets, that are required for the conduct of their businesses as currently being
conducted (each, as amended to date, the "TeleCorp Authorizations"), other than
such licenses, permits, certificates, franchises, ordinances, registrations, or
other rights, applications and authorizations the absence of which would not,
individually or in the aggregate, be reasonably likely to have a TeleCorp
Material Adverse Effect or prevent or materially impair or delay the ability of
TeleCorp to consummate the transactions contemplated hereby. TeleCorp has made
available to AWS a true, complete and correct list of the TeleCorp
Authorizations issued by the FCC.
(b) TeleCorp has previously made available to AWS a true, complete
and correct list of (i) each application of TeleCorp or any of its Subsidiaries
pending before the FCC (the "TeleCorp FCC Applications"); and (ii) each FCC
permit and FCC license which is not a TeleCorp Authorization but in which
TeleCorp, any of its Subsidiaries or any of its Affiliates, directly or
indirectly, holds an interest, including as a stakeholder in the licensee
(collectively, the "Indirect TeleCorp Authorizations"). The TeleCorp
Authorizations, the TeleCorp FCC Applications, and the Indirect TeleCorp
Authorizations are the only licenses, permits, certificates, franchises,
ordinances, registrations, or other rights, applications and authorizations that
are required for the conduct of the business and operations of TeleCorp and its
Subsidiaries as currently conducted, other than such licenses, permits,
certificates, franchises, ordinances, registrations, or other rights,
applications and authorizations the absence of which would not, individually or
in the aggregate, be considered reasonably likely to have a TeleCorp Material
Adverse Effect or prevent or materially delay or impair the ability of TeleCorp
to consummate the transactions contemplated hereby.
(c) Except as disclosed in Section 2.10(c) of the TeleCorp
Disclosure Schedule:
(i) The TeleCorp Authorizations and the Indirect TeleCorp
Authorizations are in full force and effect and have not been pledged or
otherwise encumbered (except for such pledges and encumbrances securing
the TeleCorp Licensee's indebtedness to the FCC and/or the United States
Department of Treasury ("USDT"), as the case may be), assigned, suspended
or modified in any material respect (except as a result of FCC rule
changes applicable to the industry generally), canceled or revoked, and
TeleCorp and each of its Subsidiaries have each operated in compliance
with all terms thereof or any renewals thereof applicable to them, other
than where the failure to so comply would not, individually or in the
aggregate, be considered reasonably likely to have a TeleCorp Material
Adverse Effect.
(ii) To the knowledge of TeleCorp, no event has occurred with
respect to any of the TeleCorp Authorizations which permits, or after
notice or lapse of time or both would permit, revocation or termination
thereof or would result in any other material impairment of the rights of
the holder of any such TeleCorp Authorizations.
(iii) To the knowledge of TeleCorp, there is not pending any
application, petition, objection or other pleading with the FCC, any state
authority or any similar entity having jurisdiction or authority over the
operations of TeleCorp or any of its Subsidiaries which questions the
validity or contests any TeleCorp Authorization or which could reasonably
be expected, if accepted or granted, to result in the revocation,
cancellation, suspension or any material adverse modification of any
TeleCorp Authorization.
(d) Except as disclosed in Section 2.10(c) of the TeleCorp
Disclosure Schedule:
(i) Each wholly-owned Subsidiary of TeleCorp set forth in Section
2.10(d) of the TeleCorp Disclosure Schedule hereto (a "TeleCorp Licensee")
holds the FCC licenses (each an "FCC License" and collectively, the "FCC
Licenses") set forth below its name on such same schedule. Such TeleCorp
Licensee has good and marketable title, free and clear of any Liens, to
such FCC Licenses, except for such liens securing the TeleCorp Licensee's
indebtedness to the FCC and/or USDT, as the case may be, not in excess of
$140 million in the aggregate.
(ii) No person or entity other than the applicable TeleCorp
Licensee and the FCC has any right, claim or interest in or to any of the
FCC Licenses.
(iii) The FCC Licenses have been validly issued in the name of
such TeleCorp Licensee, are in full force and effect, have been granted by
Final Order and TeleCorp has no reason to believe that such licenses will
not remain in full force and effect until the respective expiration dates
set forth on the FCC Licenses.
(iv) Except for proceedings affecting the PCS or wireless
communications services industry generally, there is not pending, nor to
the knowledge of TeleCorp, threatened against TeleCorp or any TeleCorp
Licensee or against any of the TeleCorp Licenses, nor is TeleCorp aware of
any basis for, any application, action, petition, objection or other
pleading, or any proceeding with the FCC or any other Governmental
Authority which questions or contests the validity of, or seeks the
revocation, forfeiture, non-renewal or suspension of, any of the FCC
Licenses, which seeks the imposition of any modification or amendment with
respect thereto, or which would adversely affect the ability of AWS to
employ any of the FCC Licenses (other than those licenses set forth in
Section 2.25(b) of the TeleCorp Disclosure Schedule) in its business after
the Closing Date or seeks the payment of a fine, sanction, penalty,
damages or contribution in connection with the use of any of the FCC
Licenses.
(v) Each of the FCC Licenses is unimpaired by any acts or
omissions of TeleCorp or any TeleCorp Licensee.
(vi) All material documents required to be filed or fees to be
paid at any time by TeleCorp or the applicable TeleCorp Licensee with the
FCC with respect to any of the FCC Licenses have been filed or payments
made or the time period for such filing or payment has not lapsed. All
such documents filed since the date that each of the FCC Licenses was
issued or transferred to the applicable TeleCorp Licensee are true and
correct in all material respects.
(vii) None of the FCC Licenses is subject to any conditions other
than those generally applicable to the industry at large, those imposed by
FCC Law generally upon a specific class of FCC licenses or licensees, and
those appearing on the face of the applicable FCC License.
(viii) TeleCorp and each TeleCorp Licensee complies in all
material respects with all pertinent aspects of FCC Law, including without
limitation (1) the rules, regulations and policies pertaining to
eligibility to hold broadband PCS licenses in general, and the applicable
FCC Licenses in particular, including where applicable, Section 24.709 of
the FCC's rules, (2) the rules, regulations and policies governing the
CMRS spectrum cap and restricting foreign ownership of radio licenses, (3)
the Regulations and policies relating to wireless E911 (as set forth in
Section 20.18 of the FCC's CMRS rules), and (4) the rules, regulations and
policies relating to implementation of Communications Assistance for Law
Enforcement Act.
(ix) TeleCorp and each TeleCorp Licensee is in compliance with
all terms and conditions of, and all of its obligations under, the
applicable FCC Licenses. Without limiting the foregoing, TeleCorp or the
applicable TeleCorp Licensee, where applicable, has made all installment
payments due in connection with the applicable FCC Licenses to the FCC
and/or the USDT, as the case may be, on a timely basis and has not been
assessed any unpaid late payment fees or any unpaid additional interest
charges for failing to make installment payments to the FCC or USDT.
(x) No person or entity other than TeleCorp or the applicable
TeleCorp Licensee is authorized to use the spectrum described in Section
2.10(d) of the TeleCorp Disclosure Schedule.
(e) Except for the approvals contemplated by Section 2.6, no permit,
consent, approval, authorization, qualification or registration of, or
declaration to or filing with, any Governmental Authority is required to be made
or obtained by TeleCorp or any of its Subsidiaries in connection with the
transfer or deemed transfer of the FCC Licenses and Authorizations as a result
of the consummation of the transactions contemplated hereby and such
transactions will not result in a breach of such approvals, except where the
failure to obtain or make such permit, consent, approval, authorization,
qualification, registration, declaration or filing would not be considered
reasonably likely to have a TeleCorp Material Adverse Effect or prevent or
materially impair or delay the ability of TeleCorp to consummate the
transactions contemplated hereby.
2.11 No Violation of Law. Except as disclosed in Section 2.11 of the
TeleCorp Disclosure Schedule, the business of TeleCorp and its Subsidiaries is
not currently conducted nor has such business ever been conducted in violation
of any Laws, except for possible violations none of which, individually or in
the aggregate, could have a TeleCorp Material Adverse Effect. Except as
disclosed in TeleCorp SEC Reports filed prior to the date of this Agreement,
and, with respect to the FCC, as disclosed in Section 2.11 of the TeleCorp
Disclosure Schedule, no investigation, review or proceeding by any Governmental
Authority (including, without limitation, any stock exchange or other
self-regulatory body) with respect to TeleCorp or its Subsidiaries in relation
to any alleged violation of law or regulation is pending or, to TeleCorp's
knowledge, threatened, nor has any Governmental Authority (including, without
limitation, any stock exchange or other self-regulatory body) indicated an
intention to conduct the same, except for such investigations which, if they
resulted in adverse findings, would not reasonably be expected to have,
individually or in the aggregate, a TeleCorp Material Adverse Effect. Except as
set forth in the TeleCorp SEC Reports, neither TeleCorp nor any of its
Subsidiaries is subject to any cease and desist or other order, judgment,
injunction or decree issued by, or is a party to any written agreement, consent
agreement or memorandum of understanding with, or is a party to any commitment
letter or similar undertaking to, or is subject to any order or directive by, or
has adopted any board resolutions at the request of, any Governmental Authority
that materially restricts the conduct of its business or which would reasonably
be expected to have a TeleCorp Material Adverse Effect, nor has TeleCorp or any
of its Subsidiaries been advised that any Governmental Authority is considering
issuing or requesting any of the foregoing.
2.12 Absence of Certain Changes or Events.
(a) Since December 31, 2000, except as expressly disclosed in the
TeleCorp SEC Reports filed prior to the date hereof (other than in the "risk
factors" or similar section of any such TeleCorp SEC Report), (i) TeleCorp and
its Subsidiaries have conducted their businesses only in the ordinary course of
business consistent with past practice (the "Ordinary Course of Business") and,
(ii) there has not been any change, event, development, damage or circumstance
affecting TeleCorp or any of its Subsidiaries which, individually or in the
aggregate, has had, or could reasonably be expected to have, a TeleCorp Material
Adverse Effect.
(b) Since December 31, 2000, (i) there has not been any material
change by TeleCorp in its accounting methods, principles or practices, any
revaluation by TeleCorp of any of its assets, including writing down the value
of inventory or writing off notes or accounts receivable other than in the
Ordinary Course of Business, and (ii) there has not been any condition, event or
occurrence which could reasonably be expected to prevent, hinder or materially
delay the ability of TeleCorp to consummate the transactions contemplated by
this Agreement or the Related Agreements.
2.13 Absence of Liabilities. TeleCorp and its Subsidiaries do not
have any liabilities or obligations of any nature (whether absolute, accrued,
fixed, contingent or otherwise) other than (i) liabilities or obligations (1)
which are accrued or reserved against in the consolidated financial statements
of TeleCorp and its Subsidiaries included in TeleCorp's Annual Report on Form
10-K for the fiscal year ended December 31, 2000 or reflected in the notes
thereto or (2) which were incurred after December 31, 2000 in the Ordinary
Course of Business, (ii) liabilities or obligations which have been discharged
or paid in full prior to the date hereof in the Ordinary Course of Business,
(iii) liabilities and obligations which are of a nature not required to be
reflected in the consolidated financial statements of TeleCorp and its
Subsidiaries prepared in accordance with GAAP.
2.14 Absence of Litigation. Except as disclosed in the TeleCorp SEC
Reports filed prior to the date of this Agreement, there is no Litigation
pending or, to the knowledge of TeleCorp, threatened against TeleCorp or any of
its Subsidiaries, or any properties or rights of TeleCorp or any of its
Subsidiaries, before or subject to any Court or Governmental Authority which,
individually or in the aggregate, has had, or would reasonably be expected to
have, a TeleCorp Material Adverse Effect.
2.15 Employee Benefit Plans.
(a) TeleCorp has delivered to AWS true, complete and correct copies
of all employee benefit plans (as defined in Section 3(3) of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA")) and all bonus,
stock or other security options, stock or other security purchase, stock or
other security appreciation right, incentive, deferred compensation, retirement
or supplemental retirement, severance, golden parachute, vacation, cafeteria,
dependent care, medical care, employee assistance program, education or tuition
assistance programs, plant closing or similar benefit plans, retiree health or
life benefit plans, insurance and other similar fringe or employee benefit
plans, programs or arrangements, and any executive employment or executive
compensation or severance agreements, or a written summary of the material terms
of any of the foregoing agreements if not in writing, which have ever been
sponsored, maintained, contributed to or entered into by TeleCorp or any of its
Subsidiaries, or any trade or business (whether or not incorporated) which is a
member of a controlled group or which is under common control with TeleCorp, or
any Subsidiary of TeleCorp, within the meaning of Section 414 of the Code or
Section 4001 of ERISA (a "TeleCorp ERISA Affiliate") for the benefit of, or
relating to, any present or former employee, officer, director or consultant of
such entity, whether or not such plan is terminated (together, the "TeleCorp
Employee Plans").
(b) TeleCorp has delivered to AWS with respect to each TeleCorp
Employee Plan true, complete and correct copies of each of the following, if
applicable: (i) the most recent summary plan description and any subsequent
summary of material modifications, (ii) any related trust, insurance policy or
other funding vehicle or contract providing for benefits, (iii) the two most
recently filed Form 5500 series Annual Reports with all schedules, (iv) the most
recent determination letter from the IRS, (v) the most recent annual financial
report and (vi) the most recent annual actuarial report. Subject to the
requirements of ERISA, there are no restrictions on the ability of the sponsor
of each TeleCorp Employee Plan to amend or terminate any TeleCorp Employee Plan
and each TeleCorp Employee Plan may with the consent of TeleCorp (or applicable
Subsidiary or TeleCorp ERISA Affiliate) be assumed by AWS or the Surviving
Corporation, as the case may be.
(c) Except as specifically provided in the foregoing documents
delivered to AWS, there are no amendments to any TeleCorp Employee Plan that
have been adopted or approved nor has TeleCorp or any of its Subsidiaries
undertaken or committed to make any such amendments or to adopt or approve any
new TeleCorp Employee Plan.
(d) (i) None of TeleCorp and its Subsidiaries nor, to the knowledge
of TeleCorp, any other person, including any fiduciary, has engaged in any
"prohibited transaction" (as defined in Section 4975 of the Code or Section 406
of ERISA), which could subject TeleCorp, any of its ERISA Affiliates or any
person that TeleCorp or any of its ERISA Affiliates has an obligation to
indemnify, to any material tax or penalty imposed under Section 4975 of the Code
or Section 502 of ERISA; (ii) there are no claims pending (other than routine
claims for benefits) or threatened against any TeleCorp Employee Plan or against
the assets of any TeleCorp Employee Plan, nor are there any current or
threatened Liens on the assets of any TeleCorp Employee Plan; (iii) each
TeleCorp Employee Plan conforms to, and in its operation and administration is
in all material respects in compliance with the terms thereof and the
requirements prescribed by any and all statutes (including ERISA and the Code),
orders, or governmental rules and regulations currently in effect with respect
thereto (including, without limitation, all applicable requirements for
notification, reporting and disclosure to participants or the Department of
Labor, the IRS or Secretary of the Treasury), and TeleCorp, each of its
Subsidiaries and each TeleCorp ERISA Affiliate have performed all obligations
required to be performed by them under, are not in default under or violation
of, and have no knowledge of any default or in violation by any other party with
respect to, any TeleCorp Employee Plan; (iv) each TeleCorp Employee Plan
intended to qualify under Section 401(a) of the Code and each corresponding
trust intended to be exempt under Section 501 of the Code is so qualified or
exempt, has received or is the subject of a favorable determination or opinion
letter from the IRS and nothing has occurred which may be expected to cause the
loss of such qualification or exemption; (v) all contributions (including
premiums for any insurance policy under which benefits for any TeleCorp Employee
Plan are provided) required to be made to any TeleCorp Employee Plan pursuant to
Section 412 of the Code, or any contract, or the terms of the TeleCorp Employee
Plan or any collective bargaining agreement, or otherwise have been made on or
before their due dates and a reasonable amount has been accrued for
contributions to each TeleCorp Employee Plan for its current plan year; (vi)
each TeleCorp Employee Plan, if any, which is maintained outside of the United
States has been operated in all material respects in conformance with the
applicable statutes or governmental regulations and rulings relating to such
plans in the jurisdictions in which such TeleCorp Employee Plan is present or
operates and, to the extent relevant, the United States; and (vii) no TeleCorp
Employee Plan is an "employee pension benefit plan" (within the meaning of
Section 3(2) of ERISA) subject to Title IV of ERISA (a "Defined Benefit Plan"),
or a Multiemployer Plan (as such term is defined in Section 3(37) of ERISA), or
a "single-employer plan which has two or more contributing sponsors at least two
of whom are not under common control" as described in Section 4063 of ERISA, and
none of TeleCorp, any of its Subsidiaries or any TeleCorp ERISA Affiliate has
ever maintained or sponsored, participated in, or made or been obligated to make
contributions to such a Defined Benefit Plan or such a Multiemployer Plan or
such a single employer plan as described in Section 4063 of ERISA.
(e) Each TeleCorp Employee Plan that is a "group health plan"
(within the meaning of Code Section 5000(b)(1)) has been operated in compliance
in all material respects with all laws applicable to such plan, its terms, and
with the group health plan continuation coverage requirements of Section 4980B
of the Code and Sections 601 through 608 of ERISA ("COBRA Coverage"), Section
4980D of the Code and Sections 701 through 707 of ERISA, Title XXII of the
Public Health Service Act, the provisions of the Social Security Act, and the
provisions of any similar law of any state providing for continuation coverage,
in each case to the extent such requirements are applicable. No TeleCorp
Employee Plan or written or oral agreement exists which obligates TeleCorp, any
of its Subsidiaries or any TeleCorp ERISA Affiliate to provide health care
coverage, medical, surgical, hospitalization, death, life insurance or similar
benefits (whether or not insured) to any current or former employee, officer,
director or consultant of TeleCorp, any of its Subsidiaries or any TeleCorp
ERISA Affiliate or to any other person following such current or former
employee's, officer's, director's or consultant's termination of employment with
TeleCorp, any of its Subsidiaries or any TeleCorp ERISA Affiliate, other than
COBRA Coverage.
(f) Neither the execution and delivery of this Agreement nor the
consummation of the transactions contemplated hereby will (either alone or in
conjunction with any other event) result in, cause the accelerated vesting,
funding or delivery of, or increase the amount or value of, any payment or
benefit to any employee, officer or director of TeleCorp or any of its
Subsidiaries, or result in any limitation on the right of TeleCorp or any of its
Subsidiaries to amend, merge, terminate or receive a reversion of assets from
any TeleCorp Employee Plan or related trust. Without limiting the generality of
the foregoing, no amount paid or payable (whether in cash, property, or in the
form of benefits) by TeleCorp or any of its Subsidiaries in connection with the
transactions contemplated hereby (either solely as a result thereof or as a
result of such transactions in conjunction with any other event) will be an
"excess parachute payment" within the meaning of Section 280G of the Code.
(g) The consummation of the transactions contemplated by this
Agreement will not constitute a "prohibited transaction" under ERISA or the Code
for which an exemption is unavailable.
(h) TeleCorp and its Subsidiaries have not made any payments, are
not obligated to make any payments, and are not a party to any agreements that
under any circumstances could obligate any of them to make any payments that
would constitute compensation in excess of the limitation set forth in Section
162(m) of the Code.
2.16 Employment and Labor Matters. There are no controversies
pending or, to TeleCorp's knowledge, threatened, between TeleCorp or any of its
Subsidiaries and any of their respective employees; neither TeleCorp nor any of
its Subsidiaries is a party to any collective bargaining agreement or other
labor union contract applicable to persons employed by TeleCorp or its
Subsidiaries nor to TeleCorp's knowledge are there any activities or proceedings
of any labor union to organize any such employees of TeleCorp or any of its
Subsidiaries. Since December 31, 2000, there have been no strikes, slowdowns,
work stoppages, lockouts, or threats thereof, by or with respect to any
employees of TeleCorp or any of its Subsidiaries. TeleCorp does not have nor at
the Closing will TeleCorp have any obligation under the Worker Adjustment and
Retraining Notification Act as a result of any acts of TeleCorp taken in
connection with the transactions contemplated hereby. Each of TeleCorp and its
Subsidiaries is in compliance with all applicable Federal, state, local, and
foreign employment, wage and hour, labor non-discrimination and other applicable
laws or regulations.
2.17 Registration Statement; Proxy Statement/Prospectus. None of the
information supplied by TeleCorp in writing for inclusion in the registration
statement on Form S-4, or any amendment or supplement thereto, pursuant to which
the shares of AWS Common Stock to be issued in the Merger will be registered
with the SEC (including any amendments or supplements thereto, the "Registration
Statement") shall, at the time such document is filed, at the time amended or
supplemented, at the time the Registration Statement is declared effective by
the SEC and at the time of the special meeting of the stockholders of TeleCorp
in connection with the Merger (the "TeleCorp Stockholders' Meeting"), contain
any untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading. None of the information supplied by TeleCorp for inclusion in the
proxy statement/prospectus to be sent to the stockholders of TeleCorp in
connection with the TeleCorp Stockholders Meeting (such proxy
statement/prospectus, as amended or supplemented, is referred to herein as the
"Proxy Statement") will, on the date the Proxy Statement is first mailed to the
stockholders of TeleCorp and at the time of the TeleCorp Stockholders' Meeting,
contain any untrue statement of a material fact or omit to state any material
fact necessary in order to make the statements made therein, in light of the
circumstances under which they were made, not misleading. If at any time prior
to the Effective Time any event relating to TeleCorp or any of its Affiliates,
officers or directors should be discovered by TeleCorp which should be or should
have been set forth in an amendment or supplement to the Registration Statement
or an amendment or supplement to the Proxy Statement, TeleCorp shall promptly
inform AWS of such event. The Proxy Statement shall comply in all material
respects as to form and substance with the requirements of the Exchange Act and
the rules and regulations promulgated thereunder. Notwithstanding the foregoing,
TeleCorp makes no representation or warranty with respect to any information
supplied by AWS which is contained in the Registration Statement or Proxy
Statement.
2.18 Microwave Clearing. Section 2.18 of the TeleCorp Disclosure
Schedule lists each of the microwave relocation agreements relating to the FCC
Licenses (collectively, the "Relocation Agreements"). With respect to each
Relocation Agreement, Section 2.18 of the TeleCorp Disclosure Schedule sets
forth (i) the number of links being cleared, (ii) the projected timing of
completion, (iii) the projected costs related to each such link and (iv) the
costs incurred to date with respect to each such link.
2.19 Title to Assets; Leases. Each of TeleCorp and its Subsidiaries
has good and valid title to all of their owned properties and assets. All leases
pursuant to which TeleCorp or any of its Subsidiaries lease real or personal
property from others are valid and effective in accordance with their respective
terms, and there is not, under any such lease, any existing default or event of
default (or event which with notice or lapse of time, or both, would constitute
a material default) and in respect of which TeleCorp or such Subsidiary has not
taken adequate steps to prevent such a default from occurring where such default
would reasonably be expected to have a TeleCorp Material Adverse Effect.
TeleCorp has all permits or licenses necessary to use its leased property.
2.20 Taxes.
(a) For purposes of this Agreement, "Tax" or "Taxes" shall mean (i)
taxes and governmental impositions of any kind in the nature of (or similar to)
taxes, payable to any Federal, state, local or foreign taxing authority,
including but not limited to those on or measured by or referred to as income,
franchise, profits, gross receipts, capital ad valorem, custom duties,
alternative or add-on minimum taxes, estimated, environmental, disability,
registration, value added, sales, use, service, real or personal property,
capital stock, license, payroll, withholding, employment, social security,
workers' compensation, unemployment compensation, utility, severance,
production, excise, stamp, occupation, premiums, windfall profits, transfer and
gains taxes, and interest, penalties and additions to tax imposed with respect
thereto, (ii) liability for the payment of any amounts of the types described in
clause (i) as a result of being a member of an affiliated, consolidated,
combined or unitary group, and (iii) liability for the payment of any amounts as
a result of being party to any tax sharing agreement or as a result of any
express or implied obligation to indemnify any other person with respect to the
payment of any amounts of the type described in clause (i) or (ii); and "Tax
Returns" shall mean returns, reports and information statements, including any
schedule or attachment thereto, with respect to Taxes required to be filed with
the IRS or any other governmental or taxing authority or agency, domestic or
foreign, including consolidated, combined and unitary tax returns.
(b) All Federal, state, local and foreign Tax Returns required to be
filed (taking into account extensions) on or before the Effective Time by or on
behalf of TeleCorp, each of its Subsidiaries, and each affiliated, combined,
consolidated or unitary group for Tax purposes of which TeleCorp or any of its
Subsidiaries is or has been a member have been or will be timely filed, and all
such Tax Returns are or will be true, complete and correct, except to the extent
that any failure to file or any inaccuracies in filed Tax Returns would not,
individually or in the aggregate, reasonably be expected to have a TeleCorp
Material Adverse Effect.
(c) All Taxes due and payable on or before the Effective Time by or
with respect to TeleCorp and each of its Subsidiaries have been or will be
timely paid, or in the case of Taxes due (taking into account extensions) prior
to June 30, 2001, are adequately reserved for, including for claims yet
unasserted for items that have been assessed in the past (other than a reserve
for deferred Taxes established to reflect timing differences between book and
Tax treatment) in accordance with GAAP on TeleCorp's balance sheet filed with
Form 10-Q for the quarter ending June 30, 2001 and will be adequately reserved
for (other than a reserve for deferred Taxes established to reflect timing
differences between book and Tax treatment) in accordance with GAAP on
TeleCorp's balance sheet as of the date of the Effective Time, except to the
extent that any failure to pay or reserve for such Taxes would not, individually
or in the aggregate, reasonably be expected to have a TeleCorp Material Adverse
Effect.
(d) There are no audits, disputes or administrative proceedings
pending, or claims asserted in writing, for Taxes or assessments for which
TeleCorp or any of its Subsidiaries is responsible, nor has TeleCorp or any of
its Subsidiaries been requested to give or has been granted any currently
effective waivers extending the statutory period of limitation applicable to any
Federal, state, local or foreign income Tax return for which TeleCorp is
responsible for any period which audits, disputes, administrative proceedings,
claims, assessments or waivers would reasonably be expected, individually or in
the aggregate, to have a TeleCorp Material Adverse Effect. All material
assessments for Taxes due and owing by or with respect to TeleCorp and each of
its Subsidiaries with respect to completed and settled examinations or concluded
litigation have been paid or accrued.
(e) Other than with respect to its Subsidiaries, TeleCorp is not and
has never been (nor does TeleCorp have any liability for Taxes because it once
was) a member of an affiliated, consolidated, combined or unitary group, and
neither TeleCorp nor any of its Subsidiaries is a party to any Tax allocation or
sharing agreement that will be effective as of the Effective Time or that will
have further effect for any taxable year (whether the current year, a future
year or a past year) or is liable for the Taxes of any other party under
Treasury Regulations Section 1.1502-6 (or similar provision of state, local or
foreign law), as transferee or successor, by contract, or otherwise.
(f) TeleCorp has not been a United States real property holding
corporation within the meaning of Section 897(c)(2) of the Code during the
applicable period specified in Section 897(c)(1)(A)(ii) of the Code.
(g) Each of TeleCorp and its Subsidiaries has complied in
substantially all respects with all applicable Laws relating to the payment and
withholding of Taxes (including, without limitation, withholding of Taxes
pursuant to Sections 1441, 1442 and 3406 of the Code or similar provisions under
any foreign Laws) and have, within the time and in the manner required by Law,
withheld and paid over to the proper Governmental Authorities substantially all
Taxes required to have been withheld and paid over in connection with amounts
paid or owing to any employee, independent contractor, creditor, stockholder or
other third party. Each of TeleCorp and its Subsidiaries have duly and timely
collected and remitted to the proper Governmental Authorities all material Taxes
required to be collected from customers. The federal and state universal service
charges are passed through to customers and as of the Closing Date, the amount
collected from customers will not be materially different from the amounts paid
or payable to the relevant governmental authorities.
(h) None of TeleCorp or any of its Subsidiaries shall be required to
include in a taxable period ending after the Effective Time a material amount of
taxable income attributable to income that accrued in a prior taxable period but
was not recognized in any prior taxable period as a result of the installment
method of accounting, the completed contract method of accounting, the long-term
contract method of accounting, the cash method of accounting or Section 481 of
the Code or any other provisions of Federal, state, local or foreign tax law.
2.21 Environmental Matters. Except as disclosed in the TeleCorp SEC
Reports filed prior to the date of this Agreement, and except for such
instances, if any, which would not, individually or in the aggregate, reasonably
be expected to have a TeleCorp Material Adverse Effect, (i) TeleCorp and each of
its Subsidiaries have obtained all applicable permits, licenses and other
authorizations which are required under applicable Environmental Laws as defined
below; (ii) TeleCorp and each of its Subsidiaries are in full compliance with
all applicable Environmental Laws and with the terms and conditions of all
required permits, licenses and authorizations, and also are in compliance with
all other limitations, restrictions, conditions, standards, prohibitions,
requirements, obligations, schedules and timetables contained in such laws or
contained in any applicable regulation, code, plan, order, decree, judgment,
notice or demand letter issued, entered, promulgated or approved thereunder; and
(iii) as of the date hereof, there has not been any event, condition,
circumstance, activity, practice, incident, action or plan which is reasonably
likely to interfere with or prevent continued compliance with the terms of such
permits, licenses and authorizations or which would give rise to any common law
or statutory liability, or otherwise form the basis of any claim, action, suit
or proceeding, based on or resulting from TeleCorp's or any of its Subsidiaries'
(or, to the knowledge of TeleCorp, any of their respective agent's) manufacture,
processing, distribution, use, treatment, storage, disposal, transport, or
handling, or the emission, discharge, or release into the environment, of any
Hazardous Material (as defined below); and (iv) TeleCorp and each of its
Subsidiaries has taken all actions necessary under applicable requirements of
federal, state or local laws, rules or regulations to register any products or
materials required to be registered by TeleCorp or its Subsidiaries (or, to the
knowledge of TeleCorp, any of their respective agents) thereunder. There is no
civil, criminal or administrative action, suit, demand, claim, hearing, notice
of violation, investigation, proceeding, notice or demand letter pending or, to
the knowledge of TeleCorp, threatened against TeleCorp or any of its
Subsidiaries relating in any way to the Environmental Laws or any Regulation,
code, plan, Order, decree, judgment, notice or demand letter issued, entered,
promulgated or approved thereunder, except as would not individually or in the
aggregate, reasonably be expected to have a TeleCorp Material Adverse Effect.
2.22 Intellectual Property.
(a) TeleCorp and its Subsidiaries own, or are licensed or otherwise
possess legally enforceable rights to use, all patents, trademarks, trade names,
service marks, copyrights and mask works, any applications for and registrations
of such patents, trademarks, trade names, service marks, copyrights and mask
works, and all processes, formulae, methods, schematics, technology, know-how,
computer software programs or applications and tangible or intangible
proprietary information or material that are in use or necessary to conduct the
business of TeleCorp and its Subsidiaries as currently conducted, the absence of
which would be considered reasonably likely to have a TeleCorp Material Adverse
Effect (the "TeleCorp Intellectual Property Rights").
(b) Neither TeleCorp nor any of its Subsidiaries is, or will as a
result of the execution and delivery of this Agreement or the performance of
TeleCorp's obligations under this Agreement or otherwise be, in breach of or
otherwise cause the termination of or limit any license, sublicense or other
agreement relating to the TeleCorp Intellectual Property Rights, or any material
licenses, sublicenses and other agreements as to which TeleCorp or any of its
Subsidiaries is a party and pursuant to which TeleCorp or any of its
Subsidiaries is authorized to use any third party patents, trademarks or
copyrights, including software which is used by TeleCorp or any of its
Subsidiaries, the breach of which would be considered reasonably likely to have
a TeleCorp Material Adverse Effect.
(c) All patents, trademarks, service marks (or any applications or
registrations therefor) and copyrights which are held by TeleCorp or any of its
Subsidiaries, and which are material to the business of TeleCorp and its
Subsidiaries, are current, in effect, valid and subsisting. TeleCorp (i) has not
been sued in any suit, action or proceeding or received any demands or claims
that are still pending which involves a claim of infringement of any patents,
trademarks, service marks, copyrights or violation of any trade secret or other
proprietary right of any third party; and (ii) has no knowledge that the
marketing, licensing or sale of its services infringes any patent, trademark,
service xxxx, copyright, trade secret or other proprietary right of any third
party, which infringement would reasonably be expected to have a TeleCorp
Material Adverse Effect.
(d) Section 2.22(d) of the TeleCorp Disclosure Schedule sets forth a
true and accurate list of all of the agreements, contracts and licenses that are
related to, affect, or give rise to any rights or obligation of TeleCorp or any
of its subsidiaries with respect to, the "SunCom" trademark, and related trade
names, service names, copyrights and marks, including, without limitation, as
relate to Affiliate License Co., LLC or any other entity through which TeleCorp
or any of its Subsidiaries holds any such rights.
2.23 No Restrictions on the Merger; Takeover Statutes. The Board of
Directors of TeleCorp has taken the necessary action to render Section 203 of
the DGCL, and any other potentially applicable anti-takeover or similar statute
or regulation or provision of the Certificate of Incorporation or By-laws, or
other organizational or constitutive document or governing instruments of
TeleCorp or any of its Subsidiaries or any TeleCorp Material Agreement to which
any of them is a party, inapplicable to this Agreement and the Voting Agreements
and the transactions contemplated hereby and thereby.
2.24 Tax Matters. Neither TeleCorp nor any of its Affiliates has
taken or agreed to take any action, failed to take any action or is aware of any
fact or circumstance that is reasonably likely to prevent the Merger or the
combination of the Merger and Follow-On Merger, as applicable, from qualifying
as a tax-free reorganization under Section 368(a) of the Code.
2.25 Build-out Requirements. Other than as set forth in Section
2.10(c) of the TeleCorp Disclosure Schedule, where the five-year deadline for
satisfaction of the minimum build-out requirement under 47 C.F.R. 24.203 has
passed, TeleCorp has satisfied the build-out requirement and has so notified the
FCC in a timely manner. Furthermore, other than for those licenses set forth in
Section 2.25(b) of the TeleCorp Disclosure Schedule, TeleCorp has filed
notifications of satisfaction of minimum build-out requirements for all C- and
F- Block designated entity licenses that are not otherwise freely transferable
to AWS. TeleCorp has not received from the FCC any notice indicating that any
FCC License with respect to which TeleCorp has submitted to the FCC a minimum
build-out certification failed or fails to satisfy the minimum build-out
requirement in respect of such FCC License. Other than as set forth in Section
2.10(c) of the TeleCorp Disclosure Schedule, TeleCorp is not in breach or
otherwise in violation of any FCC build-out requirement relating to any FCC
License. On or prior to the date hereof, TeleCorp has entered into the agreement
(the "Transfer Agreement"), attached hereto as Exhibit F, to transfer control
of, assign, or otherwise convey an interest in, on or prior to Closing, the FCC
Licenses set forth in Section 2.25(b) of the TeleCorp Disclosure Schedule.
2.26 Brokers. Except for XX Xxxxxx Chase & Co. and Xxxxxx Bros.
Inc., no broker, financial advisor, finder or investment banker or other Person
is entitled to any broker's, financial advisor's, finder's or other fee or
commission in connection with the transactions contemplated by this Agreement
based upon arrangements made by or on behalf of TeleCorp. TeleCorp has
heretofore furnished to AWS a true, complete and correct copy of all agreements
between TeleCorp and XX Xxxxxx Chase & Co. and Xxxxxx Bros. Inc. pursuant to
which such firms would be entitled to any payment relating to the transactions
contemplated hereunder. The total fees and expenses of XX Xxxxxx Chase & Co. and
Xxxxxx Bros. Inc. relating to the transactions contemplated hereunder, shall not
exceed the amount set forth in Section 2.26 of the TeleCorp Disclosure Schedule.
2.27 Opinion of Financial Advisor. TeleCorp has received the written
opinions of its financial advisors, Xxxxxx Bros. Inc. and X.X. Xxxxxx Securities
Inc., to the effect that, in their opinion, (i) the Exchange Ratio applicable to
each class of TeleCorp Common Stock (other than TeleCorp Voting Preference
Common Stock) is fair, from a financial point of view, to the holders (other
than AWS) of such class of stock and (ii) the Exchange Ratio applicable to each
of the TeleCorp Series C Preferred Stock and TeleCorp Series E Preferred Stock
is fair, from a financial point of view, to the holders (other than AWS) of such
stock.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF AWS
Except as set forth in the AWS Disclosure Schedule previously
delivered to TeleCorp concurrently herewith (the "AWS Disclosure Schedule"),
AWS, on behalf of itself and Merger Sub, represents and warrants to TeleCorp
that the statements contained in this Article III are true, complete and
correct. The AWS Disclosure Schedule shall be arranged in paragraphs
corresponding to the numbered and lettered paragraphs contained in this Article
III, and the disclosure in any paragraph shall qualify only the corresponding
paragraph of this Article III. As used in this Agreement, an "AWS Material
Adverse Effect" means any change, event, occurrence, effect or state of facts
(a) that is materially adverse to or materially impairs (i) the business, assets
(including intangible assets), liabilities, financial condition or results of
operations of AWS and its Subsidiaries, taken as a whole, or (ii) the ability of
AWS to perform its obligations under this Agreement, (b) prevents consummation
of any of the transactions contemplated by this Agreement; provided that none of
the following shall be considered a Material Adverse Effect except to the extent
AWS is affected in a materially disproportionate manner as compared to other
wireless telecommunications service providers: (x) changes in general economic
conditions in the United States, (y) conditions affecting the wireless
telecommunications services industry generally and (z) any changes resulting
from announcement of the Merger.
3.1 Organization and Qualification; Subsidiaries.
(a) AWS is a corporation duly incorporated, validly existing and in
good standing under the laws of the State of Delaware and has all the requisite
corporate power and authority necessary to carry on its business as it is now
being conducted. AWS is duly qualified or licensed as a foreign corporation to
do business, and is in good standing, in each jurisdiction where the character
of the properties owned, leased or operated by it or the nature of its
activities makes such qualification or licensing necessary, except where the
failure to be so qualified would not, individually or in the aggregate,
reasonably be expected to have an AWS Material Adverse Effect.
(b) Each Subsidiary of AWS is a legal entity, duly incorporated or
organized, validly existing and in good standing under the laws of its
respective jurisdiction of incorporation or organization and has all the
requisite power and authority necessary to own, lease and operate its properties
and to carry on its business as it is now being conducted. Each Subsidiary of
AWS is duly qualified or licensed as a foreign corporation to do business, and
is in good standing, in each jurisdiction where the character of the properties
owned, leased or operated by it or the nature of its activities makes such
qualification or licensing necessary, except where the failure to be so
qualified would not, individually or in the aggregate, reasonably be expected to
have an AWS Material Adverse Effect. Merger Sub has not engaged in any
activities other than in connection with the fulfillment of its or AWS's
obligations under this Agreement.
3.2 Certificate of Incorporation; By-laws. AWS has heretofore made
available to TeleCorp a true, complete and correct copy of its and Merger Sub's
respective Certificate of Incorporation and By-laws (or other equivalent
organizational or constitutive documents), each as amended or restated to date.
Each such Certificate of Incorporation and By-laws of AWS and Merger Sub are in
full force and effect. Neither AWS nor Merger Sub is in violation of any of the
provisions of its Certificate of Incorporation or By-laws or other equivalent
organizational documents.
3.3 Capitalization.
(a) The authorized capital of AWS consists of: 10,000,000,000 shares
of AWS Common Stock and 1,000,000,000 shares of Preferred Stock, $0.01 par value
per share.
(b) As of September 28, 2001: (i) 2,529,907,793 shares of AWS Common
Stock were issued and outstanding, and (ii) no shares of Preferred Stock, $0.01
par value per share, of AWS were issued and outstanding; and as of the close of
business on September 28, 2001 there were outstanding options to acquire
177,367,550 shares of AWS Common Stock and outstanding warrants (all of which
warrants had an exercise price on such date of $35.00 per share of AWS Common
Stock) to acquire 41,784,273 shares of AWS Common Stock. Except as set forth
above, there are no other outstanding rights, options, warrants, conversion
rights, or agreements that obligate AWS to issue or sell any shares of AWS
Common Stock. None of the outstanding shares of AWS Common Stock are subject to,
nor were they issued in violation of, any purchase option, call option, right of
first refusal, preemptive right, subscription right or any similar right.
(c) All outstanding shares of AWS Common Stock are duly authorized,
validly issued (including pursuant to the Securities Act), fully paid and
non-assessable and not subject to any kind of preemptive (or similar) rights.
(d) As of October 7, 2001, AWS and its Subsidiaries own: (i)
18,288,835 shares of TeleCorp Class A Voting Common Stock, (ii) no shares of
TeleCorp Class C Common Stock, (iii) 20,902 shares of TeleCorp Class D Common
Stock, (iv) no shares of TeleCorp Class E Common Stock, (v) 2,309.31 shares of
TeleCorp Class F Common Stock, (vi) 97,472.84 shares of TeleCorp Series A
Preferred Stock, (vii) 90,688.33 shares of TeleCorp Series B Preferred Stock,
(viii) 3,070.58 shares of TeleCorp Series C Preferred Stock, (ix) 49,416.98
shares of TeleCorp Series D Preferred Stock, (x) no shares of TeleCorp Series E
Preferred Stock, (xi) 14,912,778 shares of TeleCorp Series F Preferred Stock and
(xii) 46,374 shares of TeleCorp Series G Preferred Stock.
3.4 Authority; Enforceability. AWS has all necessary corporate power
and authority to execute and deliver this Agreement and the Stockholders
Agreement Amendment and to perform its obligations hereunder and thereunder and
to consummate the transactions contemplated hereby and thereby. The execution
and delivery by AWS of this Agreement and the Stockholders Agreement Amendment,
the performance of its obligations hereunder and thereunder, and the
consummation by AWS of the transactions contemplated hereby and thereby, have
been duly and validly authorized by all corporate action and no other corporate
proceedings on the part of AWS are necessary to authorize this Agreement or the
Stockholders Agreement Amendment or to consummate the transactions so
contemplated. Each of this Agreement and the Stockholders Agreement Amendment
has been duly and validly executed and delivered by AWS and, assuming the due
authorization, execution and delivery thereof by all other parties to such
agreements, constitutes a legal, valid and binding obligation of AWS in
accordance with its terms, subject to bankruptcy, insolvency, reorganization,
moratorium and similar laws relating to or affecting creditors generally or by
general equitable principles (regardless of whether such enforceability is
considered in a proceeding in equity or law).
3.5 No Conflict; Required Filings and Consents.
(a) The execution and delivery by each of AWS and Merger Sub of this
Agreement and the Stockholders Agreement Amendment do not, and the performance
of this Agreement and the Stockholders Agreement Amendment will not, (i)
conflict with or violate the Certificate of Incorporation or By-laws or other
equivalent organizational or constitutive documents of AWS or Merger Sub, (ii)
conflict with or violate any Law, Regulation or Order in each case applicable to
AWS or Merger Sub or by which any of their respective properties is bound or
affected, or (iii) result in any breach or violation of or constitute a default
(or an event that with notice or lapse of time or both would become a default)
under, or impair AWS's or Merger Sub's rights or alter the rights or obligations
of any third party under, or give to others any rights of termination,
amendment, acceleration or cancellation of, or result in the creation of a Lien
on any of the properties or assets of AWS or Merger Sub pursuant to, any note,
bond, mortgage, indenture, contract, agreement, lease, license, permit,
franchise or other instrument or obligation to which AWS or Merger Sub is a
party or by which AWS or Merger Sub or its or any of their respective properties
is bound or affected, except in the case of clauses (ii) or (iii) above, for any
such conflicts, breaches, violations, defaults or other occurrences that would
not individually or in the aggregate, reasonably be expected to have an AWS
Material Adverse Effect or prevent or materially impair or delay the
consummation of the transactions contemplated by this Agreement.
(b) The execution and delivery by AWS of this Agreement and the
Stockholders Agreement Amendment do not, and the performance of this Agreement
and the and Stockholders Agreement Amendment will not, require AWS to obtain any
approval of any Person or approval of, observe any waiting period imposed by, or
make any filing with or notification to, any Governmental Authority domestic or
foreign, except for (i) compliance with applicable requirements of the
Securities Act, the Securities Exchange Act, Blue Sky Laws, the HSR Act, or any
Foreign Competition Laws, the Communications Act, and the regulations of the
FCC, state public utility, telecommunications or public service laws, (ii) the
filing of the Certificate of Merger in accordance with the DGCL and/or (iii)
where the failure to obtain such approvals, or to make such filings or
notifications, would not, individually or in the aggregate, reasonably be
expected to have an AWS Material Adverse Effect. The approval or authorization
required to be obtained from the FCC pursuant to the Communications Act and/or
the rules and regulations of the FCC, are referred to herein as the "Required
AWS Governmental Approvals" and, together with the Required TeleCorp
Governmental Approvals, as the "Required Governmental Approvals").
3.6 Compliance. Except as disclosed in the AWS SEC Reports filed
prior to the date of this Agreement, each of AWS and Merger Sub is in compliance
in all material respects with, and is not in default or violation of, (i) its
Certificate of Incorporation and By-laws or other equivalent organizational or
constitutive documents or (ii) any material note, bond, mortgage, indenture,
contract, permit, franchise or other instruments or obligations to which any of
them are a party or by which any of them or any of their respective assets or
properties are bound or affected, except, in the case of clauses (ii) and (iii),
for any such failures of compliance, defaults and violations which would not,
individually or in the aggregate, reasonably be expected to have an AWS Material
Adverse Effect.
3.7 SEC Filings; Financial Statements.
(a) AWS has timely filed all forms, reports, schedules, statements
and documents required to be filed with the SEC since July 9, 2001 (such
filings, together with Amendment No. 4 to Registration Statement on Form S-1
dated July 6, 2001, collectively, the "AWS SEC Reports") pursuant to the Federal
securities Laws and the SEC regulations promulgated thereunder. The AWS SEC
Reports were prepared in accordance, and complied as of their respective filing
dates in all material respects, with the requirements of the Exchange Act and
the Securities Act and the rules and regulations promulgated thereunder and did
not at the time they were filed (or if amended or superseded by a filing prior
to the date hereof, then on the date of such filing) contain any untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary in order to make the statements therein, in light of
the circumstances under which they were made, not misleading.
(b) Each of the audited and unaudited consolidated financial
statements (including, in each case, any related notes and schedules thereto)
contained in the AWS SEC Reports (i) complied in all material respects with
applicable accounting requirements and the published regulations of the SEC with
respect thereto, (ii) were prepared in accordance with GAAP (except, in the case
of unaudited statements, to the extent otherwise permitted by Form 10-Q) applied
on a consistent basis throughout the periods involved (except as may be
expressly described in the notes thereto) and (iii) fairly present in all
material respects the consolidated financial position of AWS and its
Subsidiaries as at the respective dates thereof and the consolidated results of
its operations and cash flows for the periods indicated, subject in the case of
interim financial statements to normal year-end adjustments.
3.8 Licenses and Authorizations. Except as disclosed in the AWS SEC
Reports filed prior to the date of this Agreement, AWS and its Subsidiaries hold
all licenses, permits, certificates, franchises, ordinances, registrations, or
other rights, applications and authorizations required to be filed with or
granted or issued by any Governmental Authority, including, without limitation,
the FCC or any state authority asserting over AWS and its Subsidiaries, and
their respective properties and assets, that are required for the conduct of
their businesses as currently being conducted (each, as amended to date, the
"AWS Authorizations"), other than such licenses, permits, certificates,
franchises, ordinances, registrations, or other rights, applications and
authorizations the absence of which would not, individually or in the aggregate,
be reasonably likely to have an AWS Material Adverse Effect.
3.9 No Violation of Law. Except as set forth in the AWS SEC Reports
filed prior to the date of this Agreement, neither AWS nor any of its
Subsidiaries is subject to any cease and desist, or other, order, judgment,
injunction or decree issued by, or is a party to any written agreement, consent
agreement or memorandum of understanding with, or is a party to any commitment
letter or similar undertaking to, or is subject to any order or directive by, or
has adopted any board resolutions at the request of, any Governmental Authority
that materially restricts the conduct of its business or which would reasonably
be expected to have an AWS Material Adverse Effect, nor has AWS or any of its
Subsidiaries been advised that any Governmental Authority is considering issuing
or requesting any of the foregoing.
3.10 Absence of Litigation. Except as disclosed in the AWS SEC
Reports filed prior to the date of this Agreement, there is no Litigation
pending or, to the knowledge of AWS, threatened against AWS or Merger Sub, or
any properties or rights of AWS or Merger Sub, before or subject to any Court or
Governmental Authority which, individually or in the aggregate, has had, or
would reasonably be expected to have, an AWS Material Adverse Effect.
3.11 Registration Statement; Proxy Statement/Prospectus. None of the
information supplied by AWS in writing for inclusion in the Registration
Statement shall, at the time such document is filed, at the time amended or
supplemented, at the time the Registration Statement is declared effective by
the SEC and at date of the TeleCorp Stockholders Meeting, contain any untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary in order to make the statements therein, in light of
the circumstances under which they were made, not misleading. None of the
information supplied by AWS for inclusion in the Proxy Statement in connection
with the TeleCorp Stockholders' Meeting will, on the date the Proxy Statement is
first mailed to the stockholders of TeleCorp and at the date of the TeleCorp
Stockholders Meeting, contain any untrue statement of a material fact or omit to
state any material fact necessary in order to make the statements made therein,
in light of the circumstances under which they were made, not misleading. If at
any time prior to the Effective Time any event relating to AWS or any of its
Affiliates, officers or directors should be discovered by AWS which should be
set forth in an amendment or supplement to the Registration Statement or an
amendment or supplement to the Proxy Statement, AWS shall promptly inform
TeleCorp. Notwithstanding the foregoing, AWS makes no representation or warranty
with respect to any information supplied by TeleCorp which is contained in the
Registration Statement or Proxy Statement.
3.12 Taxes.
(a) All Federal, state, local and foreign Tax Returns required to be
filed (taking into account extensions) on or before the Effective Time by or on
behalf of AWS, Merger Sub, and each affiliated, combined, consolidated or
unitary group for Tax purposes of which AWS or Merger Sub is or has been a
member have been or will be timely filed, and all such Tax Returns are or will
be true, complete and correct, except to the extent that any failure to file or
any inaccuracies in filed Tax Returns would not, individually or in the
aggregate, be reasonably expected to have an AWS Material Adverse Effect.
(b) All Taxes due and payable on or before the Effective Time by or
with respect to AWS and Merger Sub have been or will be timely paid, or, in the
case of Taxes due (taking into account extensions) prior to June 30, 2001, are
adequately reserved for including for claims yet unasserted for items that have
been assessed in the past (other than a reserve for deferred Taxes established
to reflect timing differences between book and Tax treatment) in accordance with
GAAP on AWS's balance sheet filed with Form 10-Q for the quarter ending June 30,
2001 and will be adequately reserved for (other than a reserve for deferred
Taxes established to reflect timing differences between book and Tax treatment)
in accordance with GAAP on AWS's balance sheet as of the date of the Effective
Time, except to the extent that any failure to pay or reserve for such Taxes
would not, individually or in the aggregate, reasonably be expected to have an
AWS Material Adverse Effect.
(c) There are no audits, disputes pending or administrative
proceedings, or claims asserted in writing, for Taxes or assessments for which
AWS or Merger Sub is responsible, nor has AWS or Merger Sub been requested to
give or has been granted any currently effective waivers extending the statutory
period of limitation applicable to any Federal, state, local or foreign income
Tax return for which AWS is responsible for any period which audits, disputes,
administrative proceedings, claims, assessments or waivers would reasonably be
expected, individually or in the aggregate, to have an AWS Material Adverse
Effect. All assessments for Taxes due and owing by or with respect to AWS and
Merger Sub with respect to completed and settled examinations or concluded
litigation have been paid or accrued.
(d) None of AWS or any of its Subsidiaries shall be required to
include in a taxable period ending after the Effective Time an amount of taxable
income attributable to income that accrued in a prior taxable period but was not
recognized in any prior taxable period as a result of the installment method of
accounting, the completed contract method of accounting, the cash method of
accounting or Section 481 of the Code or any other provisions of Federal, state,
local or foreign tax law, if any such inclusion of income would reasonably be
expected, individually or in the aggregate, to have an AWS Material Adverse
Effect.
(e) AWS has not distributed the stock of a "controlled corporation"
as defined in Section 355(a) of the Code, and other than pursuant to the
distribution by AWS's former parent on July 9, 2001 (the "AWS Spin-Off"), AWS
stock has not been distributed in a transaction intended to qualify under
section 355 of the Code. The Merger is not part of a plan or series of related
transactions together with the Spin-Off pursuant to which one or more persons
acquire directly or indirectly AWS stock representing a 50% or greater interest
in AWS.
3.13 Tax Matters. AWS nor any of its Affiliates has taken or agreed
to take any action, failed to take any action or is aware of any fact or
circumstance that is reasonably likely to prevent the Merger or the combination
of the Merger and the Follow-On Merger, as applicable, from qualifying as a
tax-free reorganization under Section 368(a) of the Code.
3.14 Absence of Changes. Since July 9, 2001, except as expressly
disclosed in the AWS SEC Reports filed prior to the date hereof (other than in
the "risk factors" or similar section of any such AWS SEC Report), (i) AWS and
its Subsidiaries have conducted their businesses only in the Ordinary Course of
Business and (ii) there has not been any change, event, development, damage or
circumstance affecting AWS or any of its Subsidiaries which, individually or in
the aggregate, has had, or could reasonably be expected to have, an AWS Material
Adverse Effect.
3.15 Brokers. Except for Xxxxxxx Xxxxx & Co., no broker, financial
advisor, finder or investment banker or other Person is entitled to any
broker's, financial advisor's, finder's or other fee or commission in connection
with the transactions contemplated by this Agreement based upon arrangements
made by or on behalf of AWS.
3.16 Severance Policy; Letter Agreement. TeleCorp has adopted the
Change of Control Severance Policy in the form attached hereto as Exhibit G, and
has entered into the letter agreement with TeleCorp Management Corp. in the form
attached hereto as Exhibit H.
ARTICLE IV
ADDITIONAL AGREEMENTS
4.1 Access to Information; Confidentiality. TeleCorp agrees that,
during the period commencing on the date hereof and ending on earlier to occur
of the termination of this Agreement in accordance with Article VI or the
Closing Date (in either case, the "Interim Period") and subject to applicable
law, (i) it will give or cause to be given to AWS and its counsel, financial
advisors, auditors and other authorized representatives (collectively, "AWS
Representatives") such access, during normal business hours and upon reasonable
advance notice, to the plants, properties, books and records of it and its
Subsidiaries as AWS may from time to time reasonably request, (ii) it will
furnish or cause to be furnished to AWS and the AWS Representatives such
financial and operating data and other information as it may from time to time
reasonably request and (iii) it will provide AWS and the AWS Representatives
such access to the representatives, officers and employees of it and its
Subsidiaries as AWS may reasonably request. TeleCorp shall not be required to
provide access to or disclose information where such access of disclosure would
contravene any applicable Law. AWS agrees that it will, and will cause the AWS
Representatives to, continue to treat all information obtained hereunder as
"Evaluation Material" under the Confidentiality Agreement, dated October 2, 2001
("Confidentiality Agreement").
4.2 Conduct of Business Pending the Closing Date.
(a) TeleCorp agrees and hereby covenants that, except as permitted,
required or contemplated by this Agreement or as described in clear detail in
Section 4.2 of the Company Disclosure Schedule or as otherwise consented to in
writing by AWS during the Interim Period:
(i) it shall (x) cause its business (including that of its
Subsidiaries) to be conducted only in the Ordinary Course of Business
consistent with reasonably anticipated subscriber growth and in compliance
with applicable Laws and (y) use all reasonable efforts to preserve intact
TeleCorp's business organization, keep available the services of its
employees and preserve the current relationships with its customers,
suppliers and other persons with which it has significant business
relations; and
(ii) without limiting the foregoing, it shall not, and shall not
permit any of its Subsidiaries to:
(A) amend its Certificate of Incorporation or By-laws or other
equivalent organizational document;
(B) (1) merge, consolidate or engage in a similar business
combination or (2) make any disposition of any direct or indirect
ownership interest in or assets comprising any tower or wireless
system or part thereof or cell site or any other local service or
access system (including any shares of capital stock of any
Subsidiary holding any such interest) or other investment (other
than cash equivalents) or material business enterprise or operation
(except for the replacement or upgrade of assets, or disposition of
redundant assets, in each case in the Ordinary Course of Business),
except sales of individual assets (other than inventory) in the
Ordinary Course of Business and sales of licenses to the extent
permitted by Section 4.2(a)(ii)(G)(4);
(C) issue or sell any shares of its capital stock or other
equity or equity-based interests in or securities convertible into
or exchangeable for such shares or equity interests, except for (A)
the issuance of additional options to purchase TeleCorp Class A
Voting Common Stock pursuant to the TeleCorp Option Plans in a
manner and amount that is consistent as to timing and amount with
the timing and amount of such grants made under such plans during
the 12 months ending October 5, 2001 and in any case does not result
in there being outstanding options to purchase more than 13,278,252
shares of TeleCorp Class A Voting Stock (assuming, for purposes of
this clause (A), that no outstanding options are exercised), and
provided that the consummation of the transactions contemplated
hereby shall not constitute a change of control with respect to any
of such options (except that any such options held by participants
in Titan's Change of Control Severance Policy shall be subject to
such accelerated vesting provisions as may be provided in such
plan), and provided, further that the exercise price of such options
shall be no less than the fair market value of such shares on the
date of grant, and (B) the issuance of TeleCorp Class A Voting
Common Stock issuable upon exercise of the Outstanding TeleCorp
Options and any options granted in accordance with clause (A);
(D) split, combine or reclassify any outstanding shares of its
capital stock;
(E) declare, set aside, make or pay any dividend (other than
dividends by Subsidiaries of TeleCorp to wholly owned Subsidiaries
of TeleCorp or to TeleCorp) or other distribution, payable in stock,
property or otherwise, with respect to any of its capital stock or
redeem, purchase or otherwise acquire or offer to redeem, purchase
or otherwise acquire any shares of its capital stock except the
acquisition, redemption or repurchase of capital stock pursuant to
and required by existing arrangements;
(F) (1) establish, or increase compensation or benefits
provided under, any stay, bonus, incentive, insurance, severance,
termination, change of control, deferred compensation, pension,
retirement, profit sharing, stock option (including, without
limitation, the granting of stock options, stock appreciation
rights, performance awards, restricted stock awards or similar
instruments), stock purchase or other employee benefit plan,
program, policy, or agreement or arrangement or (2) otherwise
increase or accelerate the vesting or payment of the compensation
payable or the benefits provided or to become payable or provided to
any of its current or former directors, officers, employees,
consultants or service providers or those of any Subsidiary, or
otherwise pay any amounts not due such individual, (3) enter into
any new or amend any existing employment or consulting agreement
with any director, officer, employees, consultants or service
provider or hire retain the services of any such person if the
compensation (base and bonus) shall exceed $150,000 or (4)
establish, adopt or enter into any collective bargaining agreement,
except in each of clauses (1) and (2), as may be required to comply
with applicable law or existing contractual arrangements;
(G) (1) acquire (including, without limitation, by merger,
consolidation or acquisition of stock or assets) any corporation,
partnership, limited liability company, other business organization
or any division thereof, (2) acquire any amount of assets of any of
the foregoing other than to the extent not prohibited by Section
4.2(a)(ii)(I) or (J), (3) enter into any joint venture, partnership
or similar arrangement or (4) acquire or dispose of any FCC Licenses
(except the acquisitions and swap of FCC Licenses set forth in
Section 2.7(a)(ii) of the TeleCorp Disclosure Schedule);
(H) assume, guarantee or endorse, or otherwise as an
accommodation become responsible for, the obligations of, or make
any loans or advances to, any Person other than TeleCorp or a
wholly-owned Subsidiary of TeleCorp, other than FCC or USDT debt
assumed in connection with the license acquisitions permitted by
Section 4.2(a)(ii)(G)(4) not in excess of $10 million in the
aggregate;
(I) make any capital expenditures that are not provided for in
the capital expenditure budget set forth in Section 4.2 of the
TeleCorp Disclosure Schedule;
(J) make a purchase commitment outside the Ordinary Course of
Business or materially in excess of the normal, ordinary and usual
requirements;
(K) change accounting methods, principles or practices, except
insofar as may be required by a change in GAAP;
(L) incur any indebtedness for borrowed money other than to
the extent permitted in Section 4.2(c);
(M) sell, assign, transfer or license any TeleCorp
Intellectual Property Rights, except in the Ordinary Course of
Business;
(N) enter into, amend, terminate, take or omit to take any
action that would constitute a material violation of or default
under, or waive any material rights under, any TeleCorp Material
Contracts or any agreement, contract or understanding of the type
referred to in 2.7(c) and (d);
(O) take any action or fail to take any reasonable action
permitted by this Agreement if such action or failure to take action
would result in (x) any of its representations and warranties set
forth in this Agreement becoming untrue in any material respect or
(y) any of the conditions to the Closing set forth in Article V of
this Agreement not being satisfied;
(P) make any material Tax election or enter into any
settlement or compromise of any material Tax liability except as
required by a change in applicable Law;
(Q) enter into any agreement, contract or arrangement that
materially limits or otherwise materially restricts TeleCorp or any
of its Subsidiaries or Affiliates or that would reasonably be
expected, after the Effective Time, to limit or restrict AWS or any
of its Subsidiaries or Affiliates, from engaging in the business of
providing wireless communication services or otherwise from engaging
in any other business, in each case at any time or in any geographic
location;
(R) settle or compromise any action, suit or claim, in excess
of $1 million individually, or $5 million in the aggregate, or enter
into any consent decree, injunction or similar restraint or form of
equitable relief in settlement of any action, suit or claim;
(S) enter into, or amend or waive any right under, any
agreement with any Affiliates of the Company (other than its
Subsidiaries or AWS); or
(T) enter into or amend any contract, agreement, commitment or
arrangement with respect to any matter otherwise prohibited by this
Section 4.2.
(b) Systems. TeleCorp shall use all reasonable efforts to complete
the conversion of its billing system to the Convergys system. Other than as
provided for in the immediately preceding sentence, TeleCorp shall not, without
AWS's advance written consent, materially change or replace its internal
computer systems and processes, including for those billing, data base
management, customer information and call processing.
(c) Additional Indebtedness. Section 4.2(a)(ii)(L) notwithstanding:
(i) TeleCorp and its Subsidiaries, may incur new or additional indebtedness
under agreements with Lucent Technologies, Inc. existing on the date hereof,
(ii) TeleCorp and its Subsidiaries may incur additional indebtedness for
borrowed money ("Additional Debt"), provided that (x) the total amount of such
Additional Debt incurred by TeleCorp and its Subsidiaries shall not exceed $250
million, and (y) the terms of any such Additional Debt shall be reasonably
within the range of then-prevailing market terms, and (iii) TeleCorp and its
Subsidiaries may incur Additional Debt of up to $40 million from an expansion
tranche under its bank credit agreement existing on the date hereof.
(d) New Technology.
(i) During the Interim Period, neither TeleCorp nor any of its
Subsidiaries shall construct, build, deploy or purchase any equipment or
network relating to the provision of, or provide or offer any, services
that are so-called "2.5G" or "3G" or "Third Generation" services, as those
terms are commonly understood in the wireless communications industry or
as defined herein, including, with limitation, global system for mobile
communications/generalized packet radio service or "GSM"/"GPRS"
(collectively, "Advanced Services").
(ii) From and after the expiration or termination of any
applicable waiting period under the HSR Act, TeleCorp and AWS agree to
discuss from time to time at either party's request TeleCorp's short-and
long-term plans for the development and deployment of Advanced Services,
including its plans for commencing Advanced Services.
4.3 Registration Statement; Other Filings; Board Recommendations.
(a) As promptly as practicable after the execution of this
Agreement, TeleCorp and AWS will cooperate in preparing and will file with the
SEC the Registration Statement, which shall include the Proxy Statement. Each of
TeleCorp and AWS will respond jointly and promptly to any comments of the SEC,
will use all reasonable efforts to have the Registration Statement declared
effective under the Securities Act as promptly as practicable after such filing,
and TeleCorp will cause the Proxy Statement to be mailed to its stockholders at
the earliest practicable time after the Registration Statement has been declared
effective by the SEC. As promptly as practicable after the date of this
Agreement, each of TeleCorp and AWS will prepare and file any other documents
required to be filed by it under the Exchange Act, the Securities Act or any
other Federal, state, foreign or Blue Sky or related laws relating to the Merger
and the transactions contemplated by this Agreement (the "Other Filings"). No
amendment or supplement to the Proxy Statement or the Registration Statement
will be made by TeleCorp or AWS, without the prior approval of the other party
except as required by Law, and then only to the extent necessary. Each of
TeleCorp and AWS will notify the other promptly upon the receipt of any comments
from the SEC or its staff or any other government officials and of any request
by the SEC or its staff or any other government officials for amendments or
supplements to the Registration Statement, the Proxy Statement or any Other
Filing or for additional information and will supply the other with copies of
all correspondence between such party or any of its representatives, on the one
hand, and the SEC, or its staff or any other government officials, on the other
hand, with respect to the Registration Statement, the Proxy Statement, the
Merger or any Other Filing. Each of TeleCorp and AWS will cause all documents
that it is responsible for filing with the SEC or other regulatory authorities
under this Section 4.3(a) to comply in all material respects with all applicable
requirements of law and the rules and regulations promulgated thereunder.
Whenever any event occurs that is required to be set forth in an amendment or
supplement to the Proxy Statement, the Registration Statement or any Other
Filing, TeleCorp or AWS, as the case may be, will promptly inform the other of
such occurrence and cooperate in filing with the SEC or its staff or any other
government officials, and/or mailing to stockholders of TeleCorp, such amendment
or supplement.
(b) The Directors' Recommendations shall be included in the Proxy
Statement, except that the TeleCorp Board may, to the extent required, withdraw
or modify in a manner adverse to AWS such recommendation only if the TeleCorp
Board of Directors determines, in good faith, after consultation with, outside
legal counsel, that such action is required in order for the TeleCorp directors
to comply with their fiduciary duties to its stockholders under applicable law.
4.4 Meeting of TeleCorp Stockholders. TeleCorp shall promptly after
the date hereof take all action necessary in accordance with the DGCL and its
Certificate of Incorporation and By-laws to duly call, give notice of and hold
the TeleCorp Stockholders' Meeting as soon as practicable following the date
hereof in order to permit the consummation of the Merger as promptly as
practicable, for the purpose of obtaining the Required Stockholder Approval.
Once the TeleCorp Stockholders' Meeting has been called and noticed, TeleCorp
shall not postpone or adjourn (other than for the absence of a quorum and then
only to the next possible future date) the TeleCorp Stockholders' Meeting
without AWS's consent. The Board of Directors of TeleCorp shall submit this
Agreement to the stockholders of TeleCorp, whether or not the Board of Directors
of TeleCorp at any time changes, withdraws or modifies its recommendation.
TeleCorp shall solicit from stockholders of TeleCorp proxies in favor of the
Merger and shall take all other action necessary or advisable to secure the vote
or consent of stockholders required by the DGCL and its Certificate of
Incorporation to authorize this Agreement and the Merger, subject to Section
4.3(b). Without limiting the generality of the foregoing, (i) TeleCorp agrees
that its obligation to duly call, give notice of, convene and hold the TeleCorp
Stockholders' Meeting as required by this Section 4.4, shall not be affected by
any withdrawal, amendment or modification of the TeleCorp Board of Directors'
recommendation of the Merger and this Agreement, and (ii) TeleCorp agrees that
its obligations under this Section 4.4 shall not be affected by the
commencement, public proposal, public disclosure or communication to TeleCorp of
any Acquisition Proposal.
4.5 Non-Solicitation.
(a) From and after the date of this Agreement until the earlier of
the Effective Time or the termination of this Agreement in accordance with
Article VI, TeleCorp shall not, nor shall TeleCorp permit any of their
Subsidiaries to, nor shall TeleCorp authorize or permit any of its officers,
directors or employees to, and shall use its reasonable best efforts to cause
any investment banker, financial advisor, attorney, accountant, or other
representatives retained by them or any of their respective Subsidiaries not to
(i) solicit, initiate or encourage (including by way of furnishing information)
any proposals that constitute, or could reasonably be expected to result in, a
proposal or offer for an Acquisition Proposal or (ii) engage in negotiations or
discussions concerning, or provide any non-public information regarding TeleCorp
or any of its Subsidiaries to any person or entity relating to, any Acquisition
Proposal; provided, however, that nothing contained in this Agreement shall
prevent TeleCorp or its Board of Directors from, (A) prior to receipt of the
Required Stockholder Approval, furnishing non-public information to, or entering
into discussions with, any person or entity in connection with an unsolicited
bona fide written Acquisition Proposal by such person or entity if and only to
the extent that (1) the Company is not then in breach of its obligations under
this Section 4.5(a), (2) the Board of Directors of TeleCorp believes in good
faith (after consultation with its financial advisors) that such Acquisition
Proposal constitutes or may reasonably be expected to result in a Superior
Proposal and the Board of Directors of TeleCorp determines in good faith after
consultation with its outside legal counsel that failure to take such action may
constitute a breach of the Board of Directors' fiduciary duties to its
stockholders under applicable law and (3) prior to furnishing such nonpublic
information to, or entering into discussions or negotiations with, such Person
or entity, such Board of Directors receives from such Person or entity an
executed confidentiality agreement with terms no less restrictive than those
contained in the Confidentiality Agreement or (B) complying with Rules 14d-9 and
14e-2(a) promulgated under the Exchange Act with regard to an Acquisition
Proposal.
(b) Upon receiving an Acquisition Proposal, TeleCorp will promptly
notify AWS (which notice shall be provided orally and in writing and shall
identify the Person making the Acquisition Proposal), after receipt of any
Acquisition Proposal or any amendment or change in any previously received
Acquisition Proposal, or any request for nonpublic information relating to
TeleCorp or any Subsidiary of TeleCorp or for access to the properties, books or
records of TeleCorp or any Subsidiary of TeleCorp by any Person that has made,
or to TeleCorp's knowledge may be considering making, an Acquisition Proposal.
TeleCorp shall, and shall cause its Subsidiaries to, immediately cease and cause
to be terminated, and use best efforts to cause its officers, directors,
employees, investment bankers, consultants, attorneys, accountants, agents and
other representatives to, immediately cease and cause to be terminated, all
discussions and negotiations, if any, that have taken place prior to the date
hereof with any Persons with respect to any Acquisition Proposal and shall
request the return or destruction of all confidential information provided to
any such Person.
(c) TeleCorp (i) agrees not to release any Person from, or waive any
provision of, or fail to enforce, any standstill agreement or similar agreement
to which it is a party related to, or which could affect, an Acquisition
Proposal and (ii) acknowledges that the provisions of clause (i) are an
important and integral part of this Agreement.
(d) For purposes of this Agreement, "Acquisition Proposal" means any
offer or proposal for, or any indication of interest in, any (i) direct or
indirect acquisition or purchase of a business or asset of TeleCorp or any of
its Subsidiaries that constitutes 15% or more of the net revenues, net income or
assets of TeleCorp and its Subsidiaries, taken as a whole; (ii) direct or
indirect acquisition or purchase of 15% or more of any class of equity
securities, or 15% of the voting power, of TeleCorp or any of its Subsidiaries
whose business constitutes 15% or more of the net revenues, net income or assets
of TeleCorp and its Subsidiaries, taken as a whole; (iii) tender offer or
exchange offer that, if consummated, would result in any Person beneficially
owning 15% or more of any class of equity securities, or 15% of the voting
power, of TeleCorp or any of its Subsidiaries whose business constitutes 15% or
more of the net revenues, net income or assets of TeleCorp and its Subsidiaries,
taken as a whole; or (iv) merger, consolidation, business combination,
recapitalization, liquidation, dissolution or similar transaction involving
TeleCorp or any of its Subsidiaries whose business constitutes 15% or more of
the net revenue, net income or assets of TeleCorp and its Subsidiaries, taken as
a whole, other than the transactions contemplated by this Agreement. For
purposes of this Agreement, "Superior Proposal" means any bona fide written
Acquisition Proposal obtained not in breach of this Section 4.5 for or in
respect of all of the outstanding TeleCorp Capital Stock, on terms that the
Board of Directors of TeleCorp determines in its good faith judgment (after
consultation with its financial advisors and taking into account all the terms
and conditions of the Acquisition Proposal and this Agreement deemed relevant by
such Board of Directors, including any break-up fees, expense reimbursement
provisions, conditions to and expected timing and risks of consummation, and the
ability of the party making such proposal to obtain financing for such
Acquisition Proposal and taking into account all other legal, financial,
regulatory and all other aspects of such proposal) are more favorable to its
stockholders than the Merger.
4.6 Blue Sky. TeleCorp and AWS will use all their respective
reasonable efforts to obtain prior to the Effective Time all necessary state
securities or "blue sky" Permits and approvals required to permit the
distribution of the shares of AWS Common Stock to be issued in accordance with
the provisions of this Agreement.
4.7 Registration and Listing of AWS Capital Stock.
(a) AWS will use all reasonable efforts to register the shares of
AWS Common Stock to be issued pursuant to this Agreement, and upon exercise of
stock options granted to employees of TeleCorp and its Subsidiaries, under the
applicable provisions of the Securities Act and, if required, under any
applicable state securities laws.
(b) AWS will use all reasonable efforts to cause the shares of AWS
Common Stock to be issued pursuant to this Agreement and upon the exercise of
stock options granted to employees of TeleCorp and its Subsidiaries, to be
listed for trading on the New York Stock Exchange.
4.8 Further Actions.
(a) Subject to the terms and conditions hereof, TeleCorp and AWS
agree to use all reasonable efforts to take, or cause to be taken, all action
and to do, or cause to be done, all things necessary, proper or advisable to
consummate and make effective the transactions contemplated by this Agreement
and the Related Agreements including, without limitation, using all reasonable
efforts: (i) to obtain prior to the Closing Date, and satisfy any conditions
precedent to the grant of, all licenses, certificates, permits, consents,
approvals, authorizations, qualifications and orders of governmental authorities
and any other Person, including Persons who are parties to contracts with
TeleCorp or any of its Subsidiaries or AWS or any of its Subsidiaries as are
necessary for the consummation of the transactions contemplated hereby or
thereby, including, without limitation, the Required Governmental Approvals and
such consents and approvals as may be required under the Communications Act, the
HSR Act and any similar Federal, state or foreign legislation; (ii) to effect
all necessary registrations and filings; and (iii) to furnish to each other such
information and assistance as reasonably may be requested in connection with the
foregoing. Each of TeleCorp and AWS shall cooperate fully with each other to the
extent reasonably required to obtain such consents. The Parties agree to respond
promptly to requests received from any Governmental Authority for additional
information in connection with the Merger.
(b) TeleCorp and AWS shall use all reasonable efforts promptly to
make all filings which may be required by each of them in connection with the
consummation of the transactions contemplated hereby under the HSR Act and any
similar Federal, state or foreign legislation.
(c) TeleCorp and AWS shall each use their reasonable best efforts to
resolve any competitive issues relating to or arising under the HSR Act or any
other Federal, state or foreign antitrust or fair trade law raised by any
Governmental Authority and to obtain any approval or authorization required to
be obtained from the FCC pursuant to the Communications Act and/or the rules and
regulations of the FCC, in each case, in connection with the transactions
contemplated by this Agreement and the Related Agreements. If offers to resolve
any issues are not accepted by such Governmental Authority on FCC, TeleCorp
(with AWS's cooperation) shall promptly pursue all litigation resulting from
such issues. The parties hereto will consult and cooperate with one another, and
consider in good faith the views of one another, in connection with any
analyses, appearances, presentations, memoranda, briefs, arguments, opinions and
proposals made or submitted by or on behalf or any party hereto in connection
with proceedings under or relating to the HSR Act or any other Federal, state or
foreign antitrust or fair trade law or the Communications Act or any FCC
Regulations. In the event of a challenge to the transaction contemplated by this
Agreement pursuant to the HSR Act or the Communications Act or any FCC
Regulations, the parties hereto shall use their reasonable best efforts to
defeat such challenge, including by institution and defense of litigation, or to
settle such challenge on terms that permit the consummation of the Merger.
(d) Notwithstanding any other provision of this Agreement to the
contrary, (i) except as set forth in Section 4.8(f), neither TeleCorp nor any of
its Subsidiaries shall, without AWS's prior written consent, commit to any
divestiture or hold separate or similar transaction, and (ii) each of TeleCorp
and its Subsidiaries shall commit to, and shall use all their reasonable efforts
to effect, such transactions or divestitures (which may, at TeleCorp's option,
be conditioned upon the Closing and be effective as of the Effective Time) as
AWS shall request; provided that, with respect to any of TeleCorp's FCC Licenses
for which divestiture may be required to ensure compliance with the spectrum cap
(47 C.F.R. ss. 20.6), AWS agrees to make any such request to the extent required
pursuant to FCC Regulations to enable receipt of any approvals or authorizations
of the FCC required in connection with or to permit consummation of the Merger
unless such request could lead to an action or result that AWS would not be
required take or accept pursuant to the next following sentence. Notwithstanding
any other provision of this Agreement to the contrary, nothing herein shall
require AWS to agree to divest or hold separate any portion of, or restrict or
limit the operations of, any of its business or TeleCorp's business or otherwise
take action that could reasonably be expected to (A) impair the ability of (1)
AWS, directly or through its Subsidiaries, to own and operate the respective
businesses of AWS and its Subsidiaries after the Closing, or (2) AWS to own the
shares of the Surviving Corporation after the Closing, or (3) AWS to own and
operate its business if the transactions contemplated hereby are not
consummated, in each case, in substantially the same manner as operated
immediately prior to the date hereof or (B) materially impair the ability of
AWS, directly or through its Subsidiaries, to own and operate the business of
TeleCorp and its Subsidiaries after the Closing or result in a TeleCorp Material
Adverse Effect.
(e) TeleCorp shall use its reasonable best efforts to consummate, on
or prior to the Closing, the transactions contemplated by the Transfer
Agreement.
(f) TeleCorp shall or shall cause its appropriate subsidiaries to
divest itself or themselves of the FCC Licenses set forth on Section 2.25 of the
TeleCorp Disclosure Schedule as and to the extent required pursuant to FCC
Regulations to enable receipt of any approvals or authorizations of the FCC
required in connection with or to permit consummation of the Merger.
(g) AWS agrees that, at any time prior to the earlier of (x)
termination of this Agreement, (y) receipt of the Required Stockholder Approval
or (z) the withdrawal or modification of the Directors' Recommendation in a
manner adverse to AWS or the recommendation of the TeleCorp Board of any
transaction that is inconsistent with the transactions contemplated by this
Agreement, it shall vote any shares of TeleCorp Capital Stock owned by AWS and
entitled to vote thereon (i) in favor of adoption of this Agreement and the
transactions contemplated hereby and (ii) against any other matters that would
be inconsistent with consummation of this Agreement or the transactions
contemplated hereby.
(h) TeleCorp shall cause that certain Management Agreement between
TeleCorp Management Corp. and TeleCorp PCS,Inc., dated as of July 17, 1998, as
amended May 25,1999, October 18, 1999, and November 13, 2000 ("Management
Agreement") to be terminated effective on the Closing Date, no later than
simultaneously with the Closing, with no further obligation on the part of
TeleCorp or any of its Subsidiaries, provided that, Sections 8(b), 8(c), 8(d)
and Section 13 of the Management Agreement shall survive upon termination of the
Management Agreement, and Section 4(a) of the Management Agreement shall survive
with respect to any reimbursable expenses under Section 4(a) of the Management
Agreement incurred by Management prior to the date of termination of the
Management Agreement.
4.9 Notification. Each party shall promptly notify the other parties
of:
(a) any notice or other communication from any Person alleging that
the consent of such Person is or may be required in connection with the
transactions contemplated by this Agreement or the Related Agreements;
(b) any notice or other communication from any Governmental
Authority in connection with the transactions contemplated by this Agreement or
the Stockholders Agreement Amendment; and
(c) any action suit, claim, investigation or proceeding commenced
or, to its knowledge, threatened against or otherwise affecting such notifying
party, which relates to the consummation of the transactions contemplated by
this Agreement or the Related Agreement.
4.10 Notice of Breaches; Updates.
(a) TeleCorp shall promptly deliver to AWS written notice of any
event or development that would (i) render any statement, representation or
warranty of TeleCorp in this Agreement or the Related Agreements (including the
TeleCorp Disclosure Schedule) inaccurate or incomplete in any material respect
or (ii) constitute or result in a breach by TeleCorp of, or a failure by
TeleCorp or any Subsidiary of TeleCorp to comply with, any agreement or covenant
in this Agreement or the Related Agreements. No such disclosure shall be deemed
to avoid or cure any such misrepresentation or breach.
(b) AWS shall promptly deliver to TeleCorp written notice of any
event or development that would (i) render any statement, representation or
warranty of AWS in this Agreement (including the AWS Disclosure Schedule) or the
Stockholders Agreement Amendment inaccurate or incomplete in any material
respect or (ii) constitute or result in a breach by AWS of, or a failure by AWS
or any Subsidiary to comply with, any agreement or covenant in this Agreement or
the Stockholders Agreement Amendment applicable to it. No such disclosure shall
be deemed to avoid or cure any such misrepresentation or breach.
4.11 Affiliates. TeleCorp (i) has disclosed to AWS in Section 4.11
of the TeleCorp Disclosure Schedule hereof all persons who are, or may be, as of
the date hereof its "affiliates" for purposes of Rule 145 under the Securities
Act, and (ii) shall use all its reasonable efforts to cause each person who is
identified as its "affiliate" in Section 4.11 of the TeleCorp Disclosure
Schedule to deliver to AWS as promptly as practicable but in no event later than
10 days prior to the Closing Date, a signed agreement substantially in the form
attached hereto as Exhibit C. TeleCorp shall notify AWS from time to time of any
other persons who then are, or may be, such an "affiliate" and use all its
reasonable efforts to cause each additional person who is identified as an
"affiliate" to execute a signed agreement as set forth in this Section 4.11.
4.12 Employee Benefit Matters. Following the Effective Time for a
period of at least one year, AWS shall provide to officers and employees of
TeleCorp and its Subsidiaries who continue employment employee benefits under
employee benefit plans on terms and conditions which are substantially similar
in the aggregate to those provided by TeleCorp and its Subsidiaries to their
officers and employees prior to the Effective Time; provided, that in its
discretion AWS may provide to such officers and employees the employee benefits
provided to similarly situated AWS officers and employees. With respect to any
benefits plans of AWS or its Subsidiaries in which the officers and employees of
TeleCorp and its Subsidiaries participate after the Effective Time, AWS shall:
(i) waive any limitations as to pre-existing conditions, exclusions and waiting
periods with respect to participation and coverage requirements applicable to
such officers and employees under any welfare benefit plan in which such
employees may be eligible to participate after the Effective Time (provided,
however, that no such waiver shall apply to a pre-existing condition of any such
officer or employee who was, as of the Effective Time, excluded from
participation in a TeleCorp benefit plan by nature of such pre-existing
condition), (ii) provide each such officer and employee with credit for any
co-payments and deductibles paid prior to the Effective Time during the year in
which the Effective Time occurs in satisfying any applicable deductible or
out-of-pocket requirements under any welfare benefit plan in which such
employees may be eligible to participate after the Effective Time, and (iii)
recognize all service of such officers and employees with TeleCorp and its
Subsidiaries (and their respective predecessors) as an employee or officer of
AWS to the extent that such service was credited under similar TeleCorp Employee
Plans for purposes of eligibility to participate and vesting credit in any
benefit plan in which such employees may be eligible to participate after the
Effective Time, except to the extent such treatment would result in duplicative
accrual of benefits for the same period of service, and with respect to newly
adopted AWS plans, to the extent that similarly situated AWS employees are not
provided with recognition of service. Nothing herein shall be construed as
conferring upon any employee any legal rights with respect to a continuation of
employment or other relationship with AWS or its Subsidiaries.
4.13 Indemnification and Insurance.
(a) The Surviving Corporation and AWS shall indemnify, defend and
hold harmless, to the fullest extent permitted under applicable Law (in the case
of AWS, only to the extent that would be permitted by applicable Law if the
Indemnitee were an officer, director or employee of AWS rather than TeleCorp or
its Subsidiaries at the relevant time), the individuals who on or prior to the
Effective Time were officers, directors and employees of TeleCorp or its
Subsidiaries (collectively, the "Indemnitees") with respect to all acts or
omissions by them in their capacities as such or taken at the request of
TeleCorp or any of its Subsidiaries at any time on or prior to the Effective
Time. Following the Effective Time, the Surviving Corporation shall honor all
indemnification obligations presently provided under TeleCorp's Certificate of
Incorporation and By-Laws in effect on the date hereof. The Surviving
Corporation shall honor all indemnification agreements with Indemnitees
(including under TeleCorp's By-Laws) in effect as of the date of this Agreement
in accordance with the terms thereof. TeleCorp has disclosed to AWS all such
indemnification agreements prior to the date of this Agreement.
(b) For six years after the Effective Time, AWS shall or shall cause
the Surviving Corporation to procure the provision of officers' and directors'
liability insurance in respect of acts or omissions occurring prior to the
Effective Time covering each such Person currently covered by TeleCorp's
officers' and directors' liability insurance policy on terms with respect to
coverage and in amounts no less favorable than those of such policy in effect on
the date hereof; provided, that if the aggregate annual premiums for such
insurance at any time during such period shall exceed 250% of the per annum rate
of premium paid by TeleCorp and its Subsidiaries as of the date hereof for such
insurance, then AWS shall, or shall cause the Surviving Corporation to, purchase
only such coverage as shall then be available at an annual premium equal to 250%
of such rate.
(c) The certificate of incorporation of the Surviving Corporation
shall, from and after the Effective Time, contain provisions no less favorable
with respect to limitation of certain liabilities of directors and
indemnification than are set forth as of the date of this Agreement in the
Certificate of Incorporation of TeleCorp, which provisions shall not be amended,
repealed or otherwise modified for a period of six years from the Effective Time
in a manner that would adversely affect the rights thereunder of individuals who
at the Effective Time were directors or officers of TeleCorp.
(d) In the event that the Surviving Corporation or any of its
successors or assigns (i) consolidates with or merges into any other person and
is not the continuing or surviving corporation or entity of such consolidation
or merger or (ii) transfers or conveys all or substantially all of its
properties and assets to any person, or otherwise dissolves the Surviving
Corporation, then, and in each such case, AWS shall cause proper provision to be
made so that the successors and assigns of the Surviving Corporation assume the
obligations of the Surviving Corporation set forth in this Section 4.13.
4.14 Plan of Reorganization. This Agreement is intended to
constitute a "plan of reorganization" within the meaning of Treasury Regulations
Section 1.368-2(g).
4.15 Tax-Free Exchange. The parties intend the Merger or the
combination of the Merger and the Follow-On Merger, as applicable, to qualify as
a reorganization under Section 368(a) of the Code. Each of the Parties will use
all reasonable efforts, and each agrees to cooperate with the other and provide
each other with such documentation, information and materials, as may be
reasonably necessary, proper or advisable, to cause the Merger or the
combination of the Merger and the Follow-On Merger, as applicable, to so qualify
and to obtain, as of the Effective Time and, to the extent necessary, as of the
date the Form S-4 shall become effective, the opinions required pursuant to
Section 5.2(b) and Section 5.3(b) hereof. No party hereto will knowingly take
any action, fail to take any action, or cause any action to be taken if such
action or failure to take such action would cause the Merger or the combination
of the Merger and the Follow-On Merger, as applicable, not to qualify as a
reorganization under Section 368(a) of the Code. Except as required pursuant to
a determination (as defined in Section 1313 of the Code), no party hereto will
take any Tax reporting position (whether on a Tax Return or otherwise) that is
inconsistent with the treatment of the Merger, or the combination of the Merger
and the Follow-On Merger, as the case may be, as a reorganization within the
meaning of Section 368(a) of the Code.
4.16 Extension of Birmingham/Tuscaloosa Put Right. TeleCorp and AWS
hereby agree that, in the event that this Agreement is terminated pursuant to
Article VI hereof, the Put Right of TeleCorp, as such term is defined in that
certain letter to AWS from TeleCorp, dated October 20, 2000, with respect to a
10MHz PCS license in each of the Birmingham, AL BTA and the Tuscasloosa, AL BTA,
shall be exercisable through the fifth day following such termination.
ARTICLE V
CLOSING CONDITIONS
5.1 Conditions to Obligations of TeleCorp and AWS to Effect the
Merger. The respective obligations of TeleCorp and AWS to effect the Merger
shall be subject to the satisfaction at or prior to the Closing Date of each of
the following conditions:
(a) Stockholder Approval of TeleCorp. The Required Stockholder
Approval shall have been received.
(b) Registration Statement Effective; Proxy Statement. The SEC shall
have declared the Registration Statement effective. No stop order suspending the
effectiveness of the Registration Statement or any part thereof shall have been
issued and be in effect and no proceeding for that purpose, and no similar
proceeding with respect of the Proxy Statement, shall have been initiated or
threatened in writing by the SEC and not concluded or withdrawn.
(c) No Order. No Governmental Authority shall have enacted, issued,
promulgated, enforced or entered any statute, rule, regulation, executive order,
decree, injunction or other Order (whether temporary, preliminary or permanent)
which is in effect and which has the effect of prohibiting consummation of the
Merger.
(d) HSR Act. Any waiting period applicable to the consummation of
the Mergers under the HSR Act shall have expired or been terminated.
(e) NYSE Listing. The shares of AWS Common Stock issuable to the
stockholders of TeleCorp in the Merger shall have been authorized for listing on
the New York Stock Exchange upon official notice of issuance.
5.2 Additional Conditions to Obligations of TeleCorp. The obligation
of TeleCorp to consummate the Merger shall be subject to the satisfaction at or
prior to the Closing Date of each of the following conditions, any of which may
be waived, in writing, exclusively by TeleCorp:
(a) Representations and Warranties; Agreements and Covenants. (i)
AWS shall have performed or complied with in all material respects its covenants
and agreements under this Agreement that are required to be performed or
complied with prior to the Closing, (ii) the representations and warranties of
AWS contained in this Agreement (other than those referred to in clause (iii)
below) shall have been true and correct as of the date of this Agreement and as
of the Closing (except for those representations and warranties which expressly
address matters only as of the date of this Agreement or any other particular
date, which shall be true and correct in all respects only as of such date),
except to the extent that any failures of such representations and warranties to
be true and correct, individually or when aggregated with any other such
failures, does not constitute an AWS Material Adverse Effect (it being
understood that, for purposes of determining the truth and correctness of such
representations and warranties, all "AWS Material Adverse Effect" qualifications
and other qualifications based on the word "material" or similar phrases
contained in such representations and warranties shall be disregarded); (iii)
the representations and warranties of AWS contained in Sections 3.3, 3.4 and
3.5(a)(i) shall have been true and correct in all material respects as of the
date of this Agreement and as of the Closing (except for those representations
and warranties which expressly address matters only as of the date of this
Agreement or any other particular date, which shall be true and correct in all
material respects only as of such date); and (iv) and TeleCorp shall have
received a certificate of a duly authorized officer of AWS to the effects set
forth in clauses (i), (ii) and (iii) above.
(b) Tax Opinion. TeleCorp shall have received an opinion of
Cadwalader, Xxxxxxxxxx & Xxxx, dated as of the date of the Effective Time and,
if necessary, dated as of the date the Form S-4 shall become effective, in form
and substance reasonably satisfactory to TeleCorp based upon facts,
representations and assumptions set forth in such opinion, substantially to the
effect that for federal income tax purposes the Merger or the combination of the
Merger and the Follow-On Merger, as applicable, will qualify as a reorganization
within the meaning of Section 368(a) of the Code. In rendering such opinion or
opinions, as the case may be, Cadwalader, Xxxxxxxxxx & Xxxx may require and
shall be entitled to rely upon customary representations contained in
certificates of officers of AWS, Merger Sub and TeleCorp substantially in the
form of Exhibits D and E hereto, allowing for such amendments to the
representations of AWS and TeleCorp as counsel to AWS or TeleCorp, respectively,
deems reasonably necessary.
(c) Regulatory Approvals. All Required Governmental Approvals
(including all required consents of the FCC to all matters contemplated by the
Merger) shall have been obtained.
5.3 Additional Conditions to the Obligations of AWS. The obligations
of AWS to consummate the Merger shall be subject to the satisfaction at or prior
to the Closing Date of each of the following conditions, any of which may be
waived, in writing, exclusively by AWS:
(a) Representations and Warranties; Agreements and Covenants. (i)
TeleCorp shall have performed or complied with in all material respects its
covenants and agreements under this Agreement that are required to be performed
or complied with prior to the Closing, (ii) the representations and warranties
of TeleCorp contained in this Agreement (other than those referred to in clause
(iii) below) shall have been true and correct as of the date of this Agreement
and as of the Closing (except for those representations and warranties which
expressly address matters only as of the date of this Agreement or any other
particular date, which shall be true and correct in all respects only as of such
date), except to the extent that any failures of such representations and
warranties to be true and correct, individually or when aggregated with any
other such failures, does not constitute a TeleCorp Material Adverse Effect (it
being understood that, for purposes of determining the truth and correctness of
such representations and warranties, all "TeleCorp Material Adverse Effect"
qualifications and other qualifications based on the word "material" or similar
phrases contained in such representations and warranties shall be disregarded);
(iii) the representations and warranties of TeleCorp contained in Sections 2.3,
2.4, 2.5, 2.6(a)(i) and 2.23 shall have been true and correct in all material
respects as of the date of this Agreement and as of the Closing (except for
those representations and warranties which expressly address matters only as of
the date of this Agreement or any other particular date, which shall be true and
correct in all material respects only as of such date ); and (iv) and AWS shall
have received a certificate of a duly authorized officer of TeleCorp to the
effects set forth in clauses (i), (ii) and (iii) above.
(b) Tax Opinion. AWS shall have received an opinion of Wachtell,
Lipton, Xxxxx & Xxxx, dated as of the date of the Effective Time and, if
necessary, dated as of the date the Form S-4 shall become effective, in form and
substance reasonably satisfactory to AWS based upon facts, representations and
assumptions set forth in such opinion, substantially to the effect that that for
federal income tax purposes the Merger or the combination of the Merger and the
Follow-On Merger, as applicable, will qualify as a reorganization within the
meaning of Section 368(a) of the Code. In rendering such opinion or opinions, as
the case may be, Wachtell, Lipton, Xxxxx & Xxxx may require and shall be
entitled to rely upon customary representations contained in certificates of
officers of AWS, Merger Sub and TeleCorp substantially in the form of Exhibits D
and E hereto, allowing for such amendments to the representations of AWS and
TeleCorp as counsel to AWS or TeleCorp, respectively, deems reasonably
necessary.
(c) Consents. AWS and TeleCorp shall have obtained the consent or
approval of any Person (excluding any Governmental Authority) whose consent or
approval shall be required under any agreement or instrument in order to permit
the consummation of the transactions contemplated hereby except those which the
failure to obtain would not, individually or in the aggregate, have a TeleCorp
Material Adverse Effect or an AWS Material Adverse Effect.
(d) Regulatory Approvals. All Required Governmental Approvals
(including all required consents of the FCC to all matters contemplated by the
Merger) shall have been obtained pursuant to Final Orders, free of any
conditions that AWS would not be required to accept pursuant to Section 4.8, and
all other consents, approval, authorizations or filings the absence of which
could reasonably be expected to have a TeleCorp Material Adverse Effect or AWS
Material Adverse Effect if the Closing were to occur shall have been obtained or
made. For the purposes of this Agreement, "Final Order" means an action or
decision that has been granted by the relevant Governmental Authority as to
which (A) no request for a stay or similar request is pending, no stay is in
effect, the action or decision has not been vacated, reversed, set aside,
annulled or suspended and any deadline for filing such request that may be
designated by statute or regulation has passed, (B) no petition for rehearing or
reconsideration or application for review is pending and the time for the filing
of any such petition or application has passed, (C) the relevant Governmental
Authority does not have the action or decision under reconsideration on its own
motion and the time within which it may effect such reconsideration has passed
and (D) no appeal is pending, including other administrative or judicial review,
or in effect and any deadline for filing any such appeal that may be designated
by statute or rule has passed.
(e) Dissenting Shares. The Dissenting Shares shall not represent
more than 5% of the voting power of the outstanding TeleCorp Capital Stock.
(f) Management Agreement. The Management Agreement shall have been
terminated as contemplated by Section 4.8(h).
(g) Unfunded Commitment. The unfunded commitment of certain cash
equity investors of TeleCorp under the TeleCorp Stock Purchase Agreement, dated
January 23, 1998, as amended, shall have been called by TeleCorp on or before
January 15, 2002.
ARTICLE VI
TERMINATION
6.1 General. This Agreement may be terminated and the transactions
contemplated hereby may be abandoned at any time prior to the Effective Time
notwithstanding approval thereof by the stockholders of TeleCorp:
(a) by mutual written consent duly authorized by the Boards of
TeleCorp and AWS;
(b) by TeleCorp or AWS if the Closing shall not have occurred on or
before August 7, 2002 (the "Outside Date"); provided, however, that if the
Merger shall not have been consummated by such date solely due to the waiting
period (or any extension thereof) or approvals under the HSR Act or approvals or
consent of the FCC not having expired or been terminated or received, then such
date shall be extended to March 7, 2003; and provided, further, that the right
to terminate this Agreement under this Section 6.1(b) shall not be available to
any party whose failure to fulfill any material obligation under this Agreement
has been the cause of, or resulted in, the failure of the Closing to occur
before such date;
(c) by TeleCorp, if AWS shall have breached in any material respect
any of its representations or warranties or failed to perform in any material
respect any of its covenants or other agreements contained in this Agreement,
which breach or failure to perform (1) is incapable of being cured by AWS prior
to the Outside Date and (2) renders any condition under Sections 5.1 or 5.2
incapable of being satisfied prior to the Outside Date;
(d) by AWS, if TeleCorp shall have breached in any material respect
any of its representations or warranties or failed to perform in any material
respect any of its covenants or other agreements contained in this Agreement,
which breach or failure to perform (1) is incapable of being cured by TeleCorp
prior to the Outside Date and (2) renders any condition under Sections 5.1 or
5.3 incapable of being satisfied prior to the Outside Date;
(e) by TeleCorp or AWS, upon written notice to the other party, if a
Governmental Authority of competent jurisdiction shall have issued an Order or
taken any other action (which Order or other action the party seeking to
terminate shall have used all of its reasonable efforts to resist, resolve or
lift, as applicable, subject to the provisions of Section 4.8) enjoining or
otherwise prohibiting the consummation of the transactions contemplated by this
Agreement, and such Order shall have become final and non-appealable; provided,
however, that the party seeking to terminate this Agreement pursuant to this
clause (e) has fulfilled its obligations under Section 4.8;
(f) by AWS if (i) the Board of Directors of TeleCorp shall have
withdrawn or changed or modified the Directors' Recommendation in a manner
adverse to AWS; (ii) the Board of Directors of TeleCorp or the Disinterested
Directors thereof shall have approved, or determined to recommend to the
shareholders of TeleCorp that they approve an Acquisition Proposal other than
that contemplated by this Agreement; (iii) for any reason TeleCorp fails to call
or hold the TeleCorp Shareholders Meeting within six months of the date hereof
(provided that if the Registration Statement shall not have become effective for
purposes of the Federal securities laws by the date that is 20 business days
prior to the date that is five months from the date hereof, then such six month
period shall be extended by the number of days from that elapse from the end of
the five-month period until the effective date of the Registration Statement);
and
(g) by TeleCorp or AWS, if the Required Stockholder Approval shall
not have been received at a duly held meeting of the stockholders of TeleCorp
called for such purpose (including any adjournment or postponement thereof).
6.2 Obligations in Event of Termination. In the event of any
termination of this Agreement as provided in Section 6.1, this Agreement shall
forthwith become wholly void and of no further force and effect and there shall
be no liability on the part of TeleCorp or AWS, except that the obligations of
the parties, the last sentence of Section 4.1, Section 6.3, Section 8.2 and this
Section 6.2 shall remain in full force and effect, and except that termination
shall not preclude any party from suing the other party for willful breach of
this Agreement.
6.3 Termination Fees.
(a) If:
(i) AWS shall terminate this Agreement pursuant to
Section 6.1(f)(iii); or
(ii) either AWS or TeleCorp shall terminate this Agreement
pursuant to Section 6.1(g); or
(iii) AWS shall terminate this Agreement pursuant to Section
6.1(d) and prior to such termination any offer or proposal (or intent to
make any offer or proposal) that would be an Acquisition Proposal shall
have been announced or otherwise publicly disclosed and not withdrawn;
then, (1) in the case of a termination by AWS under clause (i) or clause (ii),
TeleCorp shall pay to AWS, not later than the close of business on the Business
Day following such termination an amount equal to $65,000,000 (the "Termination
Fee"); (2) in the case of a termination by TeleCorp under clause (ii) TeleCorp
shall pay to AWS, not later than, and as a condition precedent to, termination
of this Agreement, an amount equal to the Termination Fee; and (3) in the case
of a termination by AWS under clause (iii), if within 12 months after the
termination of this Agreement TeleCorp enters into an agreement with respect of
an Acquisition Proposal with any Person (other than AWS or its Subsidiaries) or
an Acquisition Proposal is consummated (it being understood that in the event
the Board of Directors of TeleCorp recommends the acceptance by the TeleCorp
stockholders of a tender offer or exchange offer with respect to an Acquisition
Proposal, such recommendation shall be treated as though an agreement with
respect to an Acquisition Proposal had been entered into on such date), TeleCorp
shall pay to AWS, not later than the date such agreement is entered into, an
amount equal to the Termination Fee. For purposes of this Section 6.3, a
proposal or offer will be deemed to have been publicly disclosed, without
limitation, if it becomes known to holders of a majority of the voting power of
the TeleCorp Capital Stock.
(b) All payments and reimbursements made under this Section 6.3
shall be made by wire transfer of immediately available funds to an account
specified by AWS.
ARTICLE VII
NO SURVIVAL
7.1 No Survival of Representations and Warranties. All
representations and warranties of the Parties in this Agreement or in any
instrument delivered pursuant to this Agreement shall terminate at the Effective
Time.
ARTICLE VIII
MISCELLANEOUS
8.1 Public Announcements. TeleCorp and AWS shall use all reasonable
efforts to develop a joint communications plan and each party shall use all
reasonable efforts to ensure that, all press releases and other public
statements with respect to the transactions contemplated hereby shall be
consistent with such joint communications plan. Unless otherwise required by
applicable law or by obligations pursuant to any listing agreement with or rules
of any securities exchange, TeleCorp shall consult with, and use all reasonable
efforts to accommodate the comments of, before issuing any press release or
otherwise making any public statement with respect to this Agreement or the
transactions contemplated hereby.
8.2 Fees and Expenses. Except as set forth in this Section 8.2, all
fees and expenses, including Taxes, incurred in connection with this Agreement
and the transactions contemplated hereby shall be paid by the party incurring
such expenses whether or not the Merger is consummated; provided, however, that
TeleCorp and AWS shall share equally all fees and expenses, other than
attorneys' and accountants' fees and expenses, incurred in relation to the
printing and filing with the SEC of the Registration Statement and Proxy
Statement and any amendments or supplements thereto.
8.3 Notices. All notices, requests, demands and other communications
which are required or may be given under this Agreement shall be in writing and
shall be deemed to have been duly given if delivered personally, sent via
facsimile or mailed, first class mail, postage prepaid, return receipt
requested, or by overnight courier as follows:
If to TeleCorp:
TeleCorp PCS, Inc.
0000 Xxxxx Xxxxx Xxxx
Xxxxx 000
Xxxxxxxxx, XX 00000
Attention: Xxx Xxxxxxxx, Executive Vice
President
Fax: 000-000-0000
with a copy to:
Cadwalader Xxxxxxxxxx & Xxxx
000 Xxxxxx Xxxx
Xxx Xxxx, XX 00000
Attention: Xxxxx Xxxxxxxx, Esq.
Fax: (000) 000-0000
and a copy to:
Xxxxxxxx, Xxxxxx & Finger
Xxx Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Attention: C. Xxxxxxx Xxxxxx, Esq.
Fax: (000) 000-0000
If to AWS:
AT&T Wireless Services, Inc.
Building 1
0000 000xx Xxxxxx, X.X.
Xxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxx, Esq.
Fax (000) 000-0000
with a copy to:
Wachtell, Lipton, Xxxxx & Xxxx
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxx X. Xxxxxxxxx, Esq.
Fax: (000) 000-0000
and a copy to:
Xxxxxxxx Xxxxxx Xxxxxxx & Xxxxxxx LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxx X. Xxxxxx, Esq.
Fax: (000) 000-0000
or to such other address as either party shall have specified by notice in
writing to the other party. All such notices, requests, demands and
communications shall be deemed to have been received on the date of personal
delivery, upon the transmission and confirmation of the facsimile, on the third
business day after the mailing thereof or on the first day after delivery by
overnight courier.
8.4 Certain Definitions. For purposes of this Agreement, the term:
(a) "Affiliate" means a Person that directly or indirectly, through
one or more intermediaries, controls, is controlled by, or is under common
control with, the first mentioned Person;
(b) "Court" means any court or arbitration tribunal of the United
States, any domestic state, or any foreign country, and any political
subdivision thereof;
(c) "Environmental Laws" means any Law pertaining to: (i) the
protection of the indoor or outdoor environment; (ii) the conservation,
management or use of natural resources and wildlife; (iii) the protection or use
of surface water and ground water; (iv) the management, manufacture, possession,
presence, use, generation, transportation, treatment, storage, disposal,
emission, discharge, release, threatened release, abatement, removal,
remediation or handling of, or exposure to, any Hazardous Material; (v) zoning;
or (vi) pollution of air, land, surface water and ground water; and includes,
without limitation, the Comprehensive Environmental, Response, Compensation, and
Liability Act of 1980, as amended, and the Regulations promulgated thereunder
and the Solid Waste Disposal Act, as amended, 42 U.S.C. xx.xx. 6901 et seq.;
(d) "Foreign Competition Laws" means any foreign statutes, rules,
regulations, Orders, administrative and judicial directives, and other foreign
Laws, that are designed or intended to prohibit, restrict or regulate actions
having the purpose or effect of monopolization, lessening of competition or
restraint of trade;
(e) "Governmental Authority" means any governmental, legislature
agency or authority (other than a Court) of the United States, any domestic
state, or any foreign country, and any political subdivision or agency thereof,
and includes any authority having governmental or quasi-governmental powers,
including any taxing authority, administrative agency or commission;
(f) "Hazardous Material" means any substance, chemical, compound,
product, solid, gas, liquid, waste, by-product, pollutant, contaminant or
material which is hazardous or toxic and is regulated under any Environmental
Law, and includes without limitation, asbestos or any substance containing
asbestos, polychlorinated biphenyls or petroleum (including crude oil or any
fraction thereof), or any substance defined or regulated as a "hazardous
material", "hazardous waste", "hazardous substance", "toxic substance", or
similar term under any Environmental Law or regulation promulgated thereunder;
(g) "Law" means all laws, statutes, ordinances and Regulations of
any Governmental Authority including all decisions of Courts having the effect
of law in each such jurisdiction;
(h) "Lien" means any mortgage, pledge, security interest,
attachment, encumbrance, lien (statutory or otherwise), option, conditional sale
agreement, right of first refusal, first offer, termination, participation or
purchase or charge of any kind (including any agreement to give any of the
foregoing); provided, however, that the term "Lien" shall not include (i)
statutory liens for Taxes, which are not yet due and payable or are being
contested in good faith by appropriate proceedings, (ii) statutory or common law
liens to secure landlords, lessors or renters under leases or rental agreements
confined to the premises rented, (iii) deposits or pledges made in connection
with, or to secure payment of, workers' compensation, unemployment insurance,
old age pension or other social security programs mandated under applicable
Laws, (iv) statutory or common law liens in favor of carriers, warehousemen,
mechanics and materialmen, to secure claims for labor, materials or supplies and
other like liens, and (v) restrictions on transfer of securities imposed by
applicable state and federal securities Laws;
(i) "Litigation" means any suit, action, arbitration, cause of
action, claim, complaint, criminal prosecution, investigation, demand letter,
governmental or other administrative proceeding, whether at law or at equity,
before or by any Court or Governmental Authority, before any arbitrator or other
tribunal;
(j) "Order" means any judgment, order, writ, injunction, ruling or
decree of, or any settlement under the jurisdiction of any Court or Governmental
Authority;
(k) "Parties" shall mean the signatories to this Agreement;
(l) "Person" means an individual, corporation, partnership,
association, trust, unincorporated organization, limited liability company,
other entity or group (as defined in Section 13(d)(3) of the Exchange Act);
(m) "Regulation" means any rule, regulation, order or binding
interpretation of any Governmental Authority; and
(n) "Subsidiary" or "Subsidiaries" of any corporation, partnership,
joint venture, limited liability company or other legal entity of which such
Person (either alone or through or together with any other Subsidiary) owns,
directly or indirectly, 50% or more of the economic interests in, or voting
rights with respect to the election of the board of directors or other governing
body of, such corporation or other legal entity.
(o) "3G" shall mean third generation mobile communications systems
that are, or are based on technology that is, defined as IMT-2000 by the
International Telecommunications Union.
8.5 Interpretation. When a reference is made in this Agreement to
Sections, subsections, Schedules or Exhibits, such reference shall be to a
Section, subsection, Schedule or Exhibit to this Agreement unless otherwise
indicated. The words "include," "includes" and "including" when used herein
shall be deemed in each case to be followed by the words "without limitation."
The word "herein" and similar references mean, except where a specific Section
or Article reference is expressly indicated, the entire Agreement rather than
any specific Section or Article.
8.6 Entire Agreement. This Agreement, the Confidentiality Agreement
and the Related Agreements, including the Exhibits and Schedules hereto,
constitute the entire agreement between the parties hereto and supersedes all
prior agreements and understanding, oral and written, between the parties hereto
with respect to the subject matter hereof.
8.7 Binding Effect; Benefit. This Agreement shall inure to the
benefit of and be binding upon the parties hereto and their respective
successors and assigns. Except as otherwise provided in Section 4.14, nothing in
this Agreement, expressed or implied, is intended to confer on any Person other
than the parties hereto or their respective successors and assigns, any rights,
remedies, obligations or liabilities under or by reason of this Agreement.
8.8 Assignability. This Agreement shall not be assignable by any
Party without the prior written consent of the other Parties (except that AWS
may designate by written notice another wholly owned Subsidiary in lieu of
Merger Sub).
8.9 Amendment; Waiver. This Agreement may be amended, supplemented
or otherwise modified only by a written instrument executed by all the Parties.
No waiver by any Party of any of the provisions hereof shall be effective unless
explicitly set forth in writing and executed by the Party so waiving. Except as
provided in the preceding sentence, no action taken pursuant to this Agreement,
including without limitation, any investigation by or on behalf of any Party,
shall be deemed to constitute a waiver by the Party taking such action of
compliance with any representations, warranties, covenants or agreements
contained herein, and in any documents delivered or to be delivered pursuant to
this Agreement and in connection with the Closing hereunder. The waiver by any
Party hereto of a breach of any provision of this Agreement shall not operate or
be construed as a waiver of any subsequent breach.
8.10 Section Headings; Table of Contents. The section headings
contained in this Agreement and the table of contents to this Agreement are for
reference purposes only and shall not affect the meaning or interpretation of
this Agreement.
8.11 Severability. If any provision of this Agreement shall be
declared by any court of competent jurisdiction to be illegal, void or
unenforceable, all other provisions of this Agreement shall not be affected and
shall remain in full force and effect.
8.12 Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original and all of which
together shall be deemed to be one and the same instrument.
8.13 GOVERNING LAW; JURISDICTION AND SERVICE OF PROCESS. THIS
AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH,
THE DOMESTIC LAWS OF THE STATE OF DELAWARE WITHOUT GIVING EFFECT TO ANY CHOICE
OF LAW OR CONFLICT OF LAW PROVISION OR RULE (WHETHER OF THE STATE OF DELAWARE OR
ANY OTHER JURISDICTION) THAT WOULD CAUSE THE APPLICATION OF THE LAWS OF ANY
JURISDICTION OTHER THAN THE STATE OF DELAWARE. EACH OF THE PARTIES HERETO
IRREVOCABLY AGREES THAT ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS
AGREEMENT OR FOR RECOGNITION AND ENFORCEMENT OF ANY JUDGMENT IN RESPECT HEREOF
BROUGHT BY ANY OTHER PARTY HERETO OR ITS SUCCESSORS OR ASSIGNS SHALL BE BROUGHT
AND DETERMINED IN THE COURTS OF THE STATE OF DELAWARE, AND EACH OF THE PARTIES
HERETO HEREBY IRREVOCABLY SUBMITS WITH REGARD TO ANY SUCH ACTION OR PROCEEDING
FOR ITSELF AND IN RESPECT TO ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, TO THE
NONEXCLUSIVE JURISDICTION OF THE AFORESAID COURTS. EACH OF THE PARTIES HERETO
HEREBY IRREVOCABLY WAIVES, AND AGREES NOT TO ASSERT, BY WAY OF MOTION, AS A
DEFENSE, COUNTERCLAIM OR OTHERWISE, IN ANY ACTION OR PROCEEDING WITH RESPECT TO
THIS AGREEMENT, ANY CLAIM (A) THAT IT IS NOT PERSONALLY SUBJECT TO THE
JURISDICTION OF THE ABOVE-NAMED COURTS FOR ANY REASON, (B) THAT IT OR ITS
PROPERTY IS EXEMPT OR IMMUNE FROM JURISDICTION OF ANY SUCH COURT OR FROM ANY
LEGAL PROCESS COMMENCED IN SUCH COURTS (WHETHER THROUGH SERVICE OF JUDGMENT,
EXECUTION OF JUDGMENT, OR OTHERWISE), OR (C) TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, THAT (I) THE SUIT, ACTION OR PROCEEDING IN SUCH COURT IS BROUGHT
IN AN INCONVENIENT FORUM, (II) THE VENUE OF SUCH SUIT, ACTION OR PROCEEDING IS
IMPROPER AND (III) THIS AGREEMENT, OR THE SUBJECT MATTER HEREOF, MAY NOT BE
ENFORCED IN OR BY SUCH COURTS.
8.14 WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY
IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING
ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY.
IN WITNESS WHEREOF, the parties hereto have executed and delivered
this Agreement as of the date first above written.
TELECORP PCS, INC.
By: /s/ Xxxxxx X. Xxxxxxxx
-------------------------------------
Name: Xxxxxx X. Xxxxxxxx
-----------------------------
Title: Chief Financial Officer &
-----------------------------
Executive Vice President
AT&T WIRELESS SERVICES, INC.
By: /s/ Xxxx X. Xxxxxx
-------------------------------------
Name: Xxxx X. Xxxxxx
-----------------------------
Title: Chairman and Chief
-----------------------------
Executive Officer
TL ACQUISITION CORP.
By: /s/ Xxxxxxx X. Xxxxx
-------------------------------------
Name: Xxxxxxx X. Xxxxx
-----------------------------
Title: President
-----------------------------
GLOSSARY OF TERMS
Defined Term Section
------------ -------
3G................................................................8.4(o)
Acquisition Proposal..............................................4.5(d)
Additional Debt...................................................4.2(c)
Advanced Services ................................................4.2(d)(i)
Affiliate.........................................................8.4(a)
Agreement.........................................................Preamble
AWS...............................................................Preamble
AWS Authorizations................................................3.8
AWS Capital Stock.................................................1.6(b)(v)
AWS Common Stock..................................................1.6(a)(i)
AWS Disclosure Schedule...........................................Article III
AWS Material Adverse Effect.......................................Article III
AWS Preferred Stock...............................................1.6(b)(v)
AWS Representatives...............................................4.1
AWS Restricted Shares.............................................1.8(c)
AWS SEC Reports...................................................3.7(a)
AWS Series C Preferred Stock......................................1.6(b)(iii)
AWS Series E Preferred Stock......................................1.6(b)(iii)
Certificate of Merger.............................................1.2
Certificates......................................................1.11(c)
Closing...........................................................1.13
Closing Date......................................................1.13
COBRA Coverage....................................................2.15(e)
Code..............................................................Recitals
Communications Act................................................2.6(b)
Confidentiality Agreement ........................................4.1
Court.............................................................8.4(b)
Defined Benefit Plan..............................................2.15(d)
DGCL..............................................................1.1
Directors' Recommendation ........................................2.5
Disinterested Directors ..........................................Recitals
Dissenting Shares ................................................1.16(a)
Effective Time....................................................1.2
Environmental Laws................................................8.4(c)
ERISA.............................................................2.15(a)
Excess Shares.....................................................1.10
Exchange Act......................................................2.6(b)
Exchange Agent....................................................1.11(a)
Exchange Ratio....................................................1.6(c)
FCC...............................................................2.6(b)
FCC License(s)....................................................2.10(d)
Final Order.......................................................5.3(d)
Follow-On Merger .................................................1.15
Foreign Competition Laws..........................................8.4(d)
GAAP..............................................................2.9(b)
Governmental Authority............................................8.4(e)
HSR Act...........................................................2.6(b)
Hazardous Material................................................8.4(f)
Indemnitees.......................................................4.13(a)
Indirect TeleCorp Authorizations..................................2.10(b)
Interim Period....................................................4.1
Law...............................................................8.4(g)
Lien..............................................................8.4(h)
Litigation........................................................8.4(i)
Management Agreement..............................................4.8(h)
Merger............................................................Recitals
Merger Consideration..............................................1.6(c)
Merger Sub........................................................Preamble
Order.............................................................8.4(j)
Ordinary Course of Business.......................................2.12(a)
Other Filings.....................................................4.3(a)
Outside Date......................................................6.1(b)
Outstanding Employee Options......................................1.8(a)
Parties...........................................................8.4(k)
Person............................................................8.4(l)
Proxy Statement...................................................2.17
Registration Statement............................................2.17
Regulation........................................................8.4(m)
Related Agreements................................................2.4
Required AWS Governmental Approvals...............................3.5(b)
Required Governmental Approvals...................................3.5(b)
Required Stockholder Approval.....................................2.5
Required TeleCorp Governmental Approvals..........................2.6(b)
Restricted Shares.................................................1.8(c)
SEC...............................................................2.7(a)
Securities Act....................................................2.3(e)
Stockholders Agreement............................................2.3(f)
Stockholders Agreement Amendment..................................2.4
Subsidiaries......................................................8.4(n)
Subsidiary........................................................8.4(n)
Superior Proposal.................................................4.5(d)
Surviving Corporation.............................................1.1
Tax...............................................................2.20(a)
Taxes.............................................................2.20(a)
Tax Returns.......................................................2.20(a)
Termination Fee...................................................6.2
TeleCorp..........................................................Preamble
TeleCorp Authorizations...........................................2.10(a)
TeleCorp Capital Stock............................................1.6(b)
TeleCorp Common Stock.............................................1.6(a)
TeleCorp Disclosure Schedule......................................Article II
TeleCorp Employee Plans...........................................2.15(a)
TeleCorp ERISA Affiliate..........................................2.15(a)
TeleCorp FCC Applications.........................................2.10(b)
TeleCorp Intellectual Property Rights.............................2.22(a)
TeleCorp Licensee.................................................2.10(d)
TeleCorp Material Adverse Effect..................................Article II
TeleCorp Material Contracts.......................................2.7(a)
TeleCorp Option Plans.............................................1.8(a)
TeleCorp Options..................................................2.3(b)
TeleCorp Preferred Stock..........................................1.6(b)
TeleCorp SEC Agreements...........................................2.7(a)
TeleCorp SEC Reports..............................................2.9(a)
TeleCorp State Authorizations.....................................2.10(b)
TeleCorp Stockholders' Meeting....................................2.17
TeleCorp Subsidiary SEC Reports...................................2.9(a)
Transfer Agreement ...............................................2.25
USDT..............................................................2.10(d)
Voting Agreements.................................................Recitals
This Filing omits the TeleCorp PCS, Inc. Disclosure Schedule.
EXHIBIT A
CERTIFICATE OF DESIGNATION OF THE POWERS,
PREFERENCES AND RELATIVE, PARTICIPATING, OPTIONAL
AND OTHER SPECIAL RIGHTS AND QUALIFICATIONS,
LIMITATIONS AND RESTRICTIONS THEREOF OF
SERIES C PREFERRED STOCK OF
AT&T WIRELESS SERVICES, INC.
PURSUANT TO SECTION 151 OF THE
GENERAL CORPORATION LAW OF THE STATE OF DELAWARE
AT&T Wireless Services, Inc., a Delaware corporation (the "Corporation"),
certifies that pursuant to the authority conferred upon the Board of Directors
of the Corporation pursuant to its Amended and Restated Certificate of
Incorporation, and in accordance with the provisions of Section 151 of the
General Corporation Law of the State of Delaware, the Board of Directors of the
Corporation, at a meeting duly called and held on October 7, 2001, duly approved
and adopted the following resolution which resolution remains in full force and
effect on the date hereof:
RESOLVED, that pursuant to the authority vested in the Board of Directors
by the Amended and Restated Certificate of Incorporation of the Corporation, the
Board of Directors does hereby designate, create, authorize and provide for the
issue of preferred stock having a par value of $0.01 per share which shall be
designated Series C Preferred Stock (the "Series C Preferred Stock") consisting
of up to 215,000 shares, which shall be issued pursuant to that certain
Agreement and Plan of Merger, dated as of October 7, 2001, between the
Corporation and TeleCorp PCS, Inc., and shall have the powers, preferences and
relative, optional and other special rights, and qualifications, limitations and
restrictions thereon as follows:
1. Powers, Preferences and Rights of Series C Preferred Stock
The powers, preferences and rights of the Series C Preferred Stock and the
qualifications, limitations and restrictions thereof are as follows:
(a) Ranking
The Series C Preferred Stock shall rank senior to the Common Stock and any
series or class of the Corporation's common or preferred stock, now or hereafter
authorized, with respect to the payment of dividends and the distribution of
assets on liquidation, dissolution or winding up.
(b) Dividends
Holders of Series C Preferred Stock shall be entitled to dividends in cash
or property when, as and if, declared by the Board of Directors of the
Corporation; provided that, in no event shall dividends in excess of the
Liquidation Preference be declared or paid. So long as shares of Series C
Preferred Stock are outstanding and dividends payable on shares of Series C
Preferred Stock have not been paid in full in cash, the Corporation shall not
declare or pay cash dividends on, or redeem, purchase or otherwise acquire for
consideration, any shares of any class of common stock or series of preferred
stock ranking junior to or on a parity with the Series C Preferred Stock, except
that the Corporation may acquire, in accordance with the terms of any agreement
between the Corporation and its employees, shares of Common Stock or Preferred
Stock at a price not greater than the Market Price as of such date.
(c) Liquidation Preference
(i) In the event of any liquidation, dissolution or winding up of
the Corporation, the holders of Series C Preferred Stock shall be entitled
to receive out of the assets of the Corporation, whether such assets are
capital or surplus of any nature, after payment is made to holders of all
series of preferred stock ranking senior to the Series C Preferred Stock
with respect to rights on liquidation, dissolution or winding up, but
before any payment shall be made or any assets distributed to the holders
of Common Stock or any series of preferred stock ranking junior to the
Series C Preferred Stock with respect to rights on liquidation,
dissolution or winding up, an amount equal to the Liquidation Preference
and no more.
(ii) If upon any liquidation, dissolution or winding up of the
Corporation the assets of the Corporation to be distributed are
insufficient to permit the payment to all holders of Series C Preferred
Stock and any other series of preferred stock ranking on a parity with
Series C Preferred Stock with respect to rights on liquidation,
dissolution or winding up, to receive their full preferential amounts, the
entire assets of the Corporation shall be distributed among the holders of
Series C Preferred Stock and all such other series ratably in accordance
with their respective Liquidation Preference.
(iii) Neither the consolidation or merger of the Corporation with or
into any other Person nor the sale or other distribution to another Person
of all or substantially all the assets, property or business of the
Corporation, shall be deemed to be a liquidation, dissolution or winding
up of the Corporation for purposes of this Section 1(c).
(d) Voting Rights
(i) The holders of shares of Series C Preferred Stock shall be
entitled to such voting rights as hereinafter provided, and shall be
entitled to notice of any stockholders' meeting and to vote upon such
matters as provided herein and in the Bylaws of the Corporation, and as
may be provided by law. Holders of Series C Preferred Stock shall not be
entitled to cumulate their votes for any purpose. Except as otherwise
required by law or provided herein, regardless of the number of shares of
Series C Preferred Stock then outstanding, the holders of the Series C
Preferred Stock shall be entitled in the aggregate to 1,926,069 votes,
voting as a class with the Common Stock of the Corporation, and the number
of votes or fractional votes to which each share of Series C Preferred
Stock shall be entitled shall be the quotient determined by dividing
1,926,069 by the number of shares of such Series C Preferred Stock then
outstanding.
(ii) In any matter requiring a separate class vote of holders of
Series C Preferred Stock or a separate vote of two or more series of
preferred stock voting together as a single class, for the purposes of
such a class vote, each share of Series C Preferred Stock shall be
entitled to one vote per share.
(iii) The affirmative vote of holders of not less than a majority of
Series C Preferred Stock shall be required to (A) authorize, increase the
authorized number of shares of or issue (including on conversion or
exchange of any convertible or exchangeable securities or by
reclassification) any shares of any class or classes of stock ranking
senior to or pari passu with the Series C Preferred Stock or any
additional shares of Series C Preferred Stock, (B) authorize, adopt or
approve each amendment to the Amended and Restated Certificate of
Incorporation of the Corporation that would increase or decrease the par
value of the shares of Series C Preferred Stock, alter or change the
powers, preferences or rights of the shares of Series C Preferred Stock or
alter or change the powers, preferences or rights of any other capital
stock of the Corporation if such alteration or change results in such
capital stock ranking senior to or pari passu with the Series C Preferred
Stock, (C) amend, alter or repeal any provision of the Amended and
Restated Certificate of Incorporation of the Corporation so as to affect
the shares of Series C Preferred Stock adversely, or (D) authorize or
issue any security convertible into, exchangeable for or evidencing the
right to purchase or otherwise receive any shares of any class or classes
of stock senior to or pari passu with the Series C Preferred Stock.
(e) Redemption at Option of the Corporation
The Corporation shall have the right to redeem shares of Series C
Preferred Stock pursuant to the following provisions:
(i) Subject to the restrictions set forth in Section 1(g)(i), the
Corporation shall have the right, at its sole option and election, to
redeem the shares of the Series C Preferred Stock, in whole but not in
part, at any time at a redemption price per share (the "Series C
Redemption Price") equal to the Liquidation Preference thereof as of the
redemption date; provided, that if the funds legally available to the
Corporation are insufficient to effect the redemption of the Series C
Preferred Stock in full, such funds shall be allocated among the shares of
Series C Preferred Stock ratably in accordance with the number of shares
of such Series outstanding as of the redemption date;
(ii) Notice of any redemption of the Series C Preferred Stock shall
be mailed at least ten but not more than 60 days prior to the date fixed
for redemption to each holder of Series C Preferred Stock to be redeemed,
at such holder's address as it appears on the books of the Corporation. In
order to facilitate the redemption of the Series C Preferred Stock, the
Board of Directors of the Corporation may fix a record date for the
determination of holders of Series C Preferred Stock to be redeemed, or
may cause the transfer books of the Corporation to be closed for the
transfer of the Series C Preferred Stock, not more than 60 days prior to
the date fixed for such redemption;
(iii) Within two Business Days after the redemption date specified
in the notice given pursuant to paragraph (ii) above and the surrender of
the certificate(s) representing shares of Series C Preferred Stock, the
Corporation shall pay to the holder of the shares being redeemed the
Series C Redemption Price therefor. Such payment shall be made by wire
transfer of immediately available funds to an account designated by such
holder or by overnight delivery (by a nationally recognized courier) of a
bank check to such holder's address as it appears on the books of the
Corporation; and
(iv) Effective upon the date of the notice given pursuant to
paragraph (ii) above, notwithstanding that any certificate for such shares
shall not have been surrendered for cancellation, the shares represented
thereby shall no longer be deemed outstanding, the rights to receive
dividends thereon shall cease to accrue from and after the date of
redemption designated in the notice of redemption and all rights of the
holders of the shares of the Series C Preferred Stock called for
redemption shall cease and terminate, excepting only the right to receive
the Series C Redemption Price therefor in accordance with paragraph (iii)
above.
(f) Redemption at Option of Holder
(i) No holder of shares of Series C Preferred Stock shall have any
right to require the Corporation to redeem any shares of Series C
Preferred Stock prior to, with respect to any shares of the Series C
Preferred Stock, December 13, 2020. Thereafter, subject to the
restrictions set forth in Section 1(g)(i), each holder of shares of Series
C Preferred Stock shall have the right, at the sole option and election of
such holder, to require the Corporation to redeem all (but not less than
all) of the shares of Series C Preferred Stock owned by such holder at a
price per share equal to the Series C Redemption Price;
(ii) The holder of any shares of the Series C Preferred Stock may
exercise such holder's right to require the Corporation to redeem such
shares by surrendering for such purpose to the Corporation, at its
principal office or at such other office or agency maintained by the
Corporation for that purpose, certificates representing the shares of
Series C Preferred Stock to be redeemed, accompanied by a written notice
stating that such holder elects to require the Corporation to redeem all
(but not less than all) of such shares in accordance with the provisions
of this Section 1(f), which notice may specify an account for delivery of
the Series C Redemption Price;
(iii) Within two Business Days after the surrender of such
certificates, the Corporation shall pay to the holder of the shares being
redeemed the Series C Redemption Price therefor. Such payment shall be
made by wire transfer of immediately available funds to an account
designated by such holder or by overnight delivery (by a nationally
recognized courier) of a bank check to such holder's address as it appears
on the books of the Corporation; and
(iv) Such redemptions shall be deemed to have been made at the close
of business on the date of the receipt of such notice and of such
surrender of the certificates representing the shares of the Series C
Preferred Stock to be redeemed and the rights of the holder thereof,
except for the right to receive the Series C Redemption Price therefor in
accordance herewith, shall cease on such date of receipt and surrender.
(g) Certain Restrictions
(i) Notwithstanding the provisions of Section 1(b) or Section 1(f),
cash dividends on the Series C Preferred Stock may not be declared, paid
or set apart for payment, nor may the Corporation redeem, purchase or
otherwise acquire any shares of Series C Preferred Stock, if (A) the
Corporation is not solvent or would be rendered insolvent thereby or (B)
at such time the terms and provisions of any law or agreement of the
Corporation, including any agreement relating to its indebtedness,
specifically prohibit such declaration, payment or setting apart for
payment or such redemption, purchase or other acquisition, or provide that
such declaration, payment or setting apart for payment or such redemption,
purchase or other acquisition would constitute a violation or breach
thereof or a default thereunder.
(ii) The Corporation shall not permit any Subsidiary of the
Corporation, or cause any other Person, to make any distribution with
respect to, or purchase or otherwise acquire for consideration, any shares
of Common Stock or other shares of capital stock of the Corporation
ranking junior to or on a parity basis with the Series C Preferred Stock
unless the Corporation could, pursuant to paragraph (i) above, make such
distribution or purchase or otherwise acquire such shares at such time and
in such manner.
2. Share Certificates
(a) Each certificate representing the shares of Series C Preferred Stock
or delivered in substitution or exchange for any of the foregoing certificates
shall be stamped with a legend in substantially the following form, to the
extent that such legend is applicable pursuant to the provisions hereof:
"The securities represented by this Certificate have been acquired
for investment and have not been registered under the Securities Act
of 1933, as amended (the "Act"), or under any state securities or
`Blue Sky' laws. Said securities may not be sold, transferred,
assigned, pledged, hypothecated or otherwise disposed of, unless and
until registered under the Act and the rules and regulations
thereunder and all applicable state securities or `Blue Sky' laws or
exempted therefrom under the Act and all applicable state securities
or `Blue Sky' laws."
(b) Upon receipt of evidence reasonably satisfactory to the Corporation of
the loss, theft, destruction or mutilation of any certificate representing
shares of Series C Preferred Stock subject to this Agreement and of a bond or
other indemnity reasonably satisfactory to the Corporation, and upon
reimbursement to the Corporation of all reasonable expenses incident thereto,
and upon surrender of such certificate, if mutilated, the Corporation will make
and deliver a new certificate of like tenor in lieu of such lost, stolen,
destroyed or mutilated certificate.
3. Definitions
For the purposes of this Certificate of Designations, the following terms
shall have the meanings indicated:
"Business Day" shall mean any day other than a Saturday, Sunday or other
day on which commercial banks in the City of New York are authorized or required
by law or executive order to close.
"Closing Price" shall mean, with respect to each share of any class or
series of capital stock for any day, (i) the last reported sale price regular
way or, in case no such sale takes place on such day, the average of the closing
bid and asked prices regular way, in either case as reported on the principal
national securities exchange on which such class or series of capital stock is
listed or admitted for trading or (ii) if such class or series of capital stock
is not listed or admitted for trading on any national securities exchange, the
last reported sale price or, in case no such sale takes place on such day, the
average of the highest reported bid and the lowest reported asked quotation for
such class or series of capital stock, in either case as reported on NASDAQ or a
similar service if NASDAQ is no longer reporting such information.
"Common Stock" shall mean the Common Stock, $.01 par value per share, of
the Corporation.
"Invested Amount" means, as of any date with respect to each share of
Series C Preferred Stock held by any stockholder, an amount equal to the
quotient of (i) the aggregate paid-in capital actually paid with respect to all
shares of Series C Preferred Stock held by such stockholder as of such date, and
all shares of capital stock of TeleCorp PCS, Inc. or its
predecessors-in-interest, TeleCorp Wireless, Inc. and Tritel, Inc., divided by
(ii) the total number of shares of Series C Preferred Stock held by such
stockholder as of such date.
"Lien" shall mean, with respect to any asset, any mortgage, lien, pledge,
charge, security interest, right of first refusal or right of others therein or
encumbrance of any nature whatsoever in respect of such asset.
"Liquidation Preference" shall mean, as of any date, and subject to
adjustment for subdivisions or combinations affecting the number of shares of
Series C Preferred Stock, with respect to each share of Series C Preferred
Stock, the Invested Amount plus accrued and unpaid dividends on such share (if
any), plus an amount equal to interest on the Invested Amount, at the rate of
six percent (6%) per annum, compounded quarterly, less the amount of dividends
(if any) theretofore declared and paid in respect of such share.
"Market Price" shall mean, with respect to each share of any class or
series of capital stock for any day, (i) the average of the daily Closing Prices
for the ten consecutive trading days commencing 15 days before the day in
question or (ii) if on such date the shares of such class or series of capital
stock are not listed or admitted for trading on any national securities exchange
and are not quoted on NASDAQ or any similar service, the cash amount that a
willing buyer would pay a willing seller (neither acting under compulsion) in an
arm's-length transaction without time constraints per share of such class or
series of capital stock as of such date, viewing the Corporation on a going
concern basis, as determined in good faith by the Board of Directors of the
Corporation, whose determination shall be conclusive; provided that, in
determining such cash amount, the following shall be ignored: (i) any contract
or legal limitation in respect of shares of common stock or preferred stock of
the Corporation, including transfer, voting and other rights, and (ii) any
illiquidity arising by contract in respect of the shares of common stock and any
voting rights or control rights amongst the stockholders.
"NASDAQ" shall mean the National Association of Securities Dealers
Automated Quotations System.
"Person" shall mean any individual, firm, corporation, partnership, trust,
incorporated or unincorporated association, joint venture, joint stock company,
governmental agency or political subdivision thereof or other entity of any
kind, and shall include any successor (by merger or otherwise) of such entity.
"Series C Preferred Stock" has the meaning specified in Section 4.1.
"Series C Redemption Price" has the meaning specified in Section
1.5(a)(i).
"Subsidiary" shall mean, with respect to any Person, a corporation or
other entity of which 50% or more of the voting power of the voting equity
securities or equity interest is owned, directly or indirectly, by such Person.
"Transfer" shall mean any direct or indirect transfer, sale, assignment,
pledge, encumbrance, tender, or otherwise grant, creation or sufferage of a Lien
in or upon, giving, placement in trust or otherwise (including transfers by
testamentary or intestate succession) disposing of by operation of law or any
short sale, collar, or hedging transaction or other derivative transaction that
has the effect of materially changing the economic benefits and risks of
ownership.
IN WITNESS WHEREOF, the Corporation has caused this Certificate to be duly
executed by the Secretary of the Corporation as of October __, 2001.
AT&T WIRELESS SERVICES, INC.
By
----------------------------------
Name:
Title:
EXHIBIT B
CERTIFICATE OF DESIGNATION OF THE POWERS,
PREFERENCES AND RELATIVE, PARTICIPATING, OPTIONAL
AND OTHER SPECIAL RIGHTS AND QUALIFICATIONS,
LIMITATIONS AND RESTRICTIONS THEREOF OF
SERIES E PREFERRED STOCK OF
AT&T WIRELESS SERVICES, INC.
PURSUANT TO SECTION 151 OF THE
GENERAL CORPORATION LAW OF THE STATE OF DELAWARE
AT&T Wireless Services, Inc., a Delaware corporation (the "Corporation"),
certifies that pursuant to the authority conferred upon the Board of Directors
of the Corporation pursuant to its Amended and Restated Certificate of
Incorporation, and in accordance with the provisions of Section 151 of the
General Corporation Law of the State of Delaware, the Board of Directors of the
Corporation, at a meeting duly called and held on October 7, 2001, duly approved
and adopted the following resolution which resolution remains in full force and
effect on the date hereof:
RESOLVED, that pursuant to the authority vested in the Board of Directors
by the Amended and Restated Certificate of Incorporation of the Corporation, the
Board of Directors does hereby designate, create, authorize and provide for the
issue of preferred stock having a par value of $0.01 per share which shall be
designated Series E Preferred Stock (the "Series E Preferred Stock") consisting
of up to 30,000 shares, which shall be issued pursuant to that certain Agreement
and Plan of Merger, dated as of October 7, 2001, between the Corporation and
TeleCorp PCS, Inc., and shall have the powers, preferences and relative,
optional and other special rights, and qualifications, limitations and
restrictions thereon as follows:
1. Powers, Preferences and Rights of Series E Preferred Stock
The powers, preferences and rights of the Series E Preferred Stock and the
qualifications, limitations and restrictions thereof are as follows:
(a) Ranking
The Series E Preferred Stock shall rank (i) junior to the Series C
Preferred Stock, par value $.01 per share (the "Series C Preferred Stock"), of
the Corporation, with respect to the payment of dividends and the distribution
of assets on liquidation, dissolution or winding up and (ii) senior to the
Common Stock and any series or class of the Corporation's common or preferred
stock, now or hereafter authorized (other than the Series C Preferred Stock),
with respect to the payment of dividends and the distribution of assets on
liquidation, dissolution or winding up.
(b) Dividends
Holders of Series E Preferred Stock shall be entitled to dividends in cash
or property when, as and if, declared by the Board of Directors of the
Corporation; provided that, in no event shall dividends in excess of the
Liquidation Preference be declared or paid. So long as shares of Series E
Preferred Stock are outstanding and dividends payable on shares of Series E
Preferred Stock have not been paid in full in cash, the Corporation shall not
declare or pay cash dividends on, or redeem, purchase or otherwise acquire for
consideration, any shares of any class of common stock or series of preferred
stock ranking junior to or on a parity with the Series E Preferred Stock, except
that the Corporation may acquire, in accordance with the terms of any agreement
between the Corporation and its employees, shares of Common Stock or Preferred
Stock at a price not greater than the Market Price as of such date.
(c) Liquidation Preference
(i) In the event of any liquidation, dissolution or winding up of
the Corporation, the holders of Series E Preferred Stock shall be entitled
to receive out of the assets of the Corporation, whether such assets are
capital or surplus of any nature, after payment is made to holders of all
series of preferred stock ranking senior to the Series E Preferred Stock
with respect to rights on liquidation, dissolution or winding up, but
before any payment shall be made or any assets distributed to the holders
of Common Stock or any series of preferred stock ranking junior to the
Series E Preferred Stock with respect to rights on liquidation,
dissolution or winding up, an amount equal to the Liquidation Preference
and no more.
(ii) If upon any liquidation, dissolution or winding up of the
Corporation the assets of the Corporation to be distributed are
insufficient to permit the payment to all holders of Series E Preferred
Stock and any other series of preferred stock ranking on a parity with
Series E Preferred Stock with respect to rights on liquidation,
dissolution or winding up, to receive their full preferential amounts, the
entire assets of the Corporation shall be distributed among the holders of
Series E Preferred Stock and all such other series ratably in accordance
with their respective Liquidation Preference.
(iii) Neither the consolidation or merger of the Corporation with or
into any other Person nor the sale or other distribution to another Person
of all or substantially all the assets, property or business of the
Corporation, shall be deemed to be a liquidation, dissolution or winding
up of the Corporation for purposes of this Section 1(c).
(d) Voting Rights
(i) The holders of shares of Series E Preferred Stock shall be
entitled to such voting rights as hereinafter provided, and shall be
entitled to notice of any stockholders' meeting and to vote upon such
matters as provided herein and in the Bylaws of the Corporation, and as
may be provided by law. Holders of Series E Preferred Stock shall not be
entitled to cumulate their votes for any purpose. Except as otherwise
required by law or provided herein, regardless of the number of shares of
Series E Preferred Stock then outstanding, the holders of the Series E
Preferred Stock shall be entitled in the aggregate to 251,189 votes,
voting as a class with the Common Stock of the Corporation, and the number
of votes or fractional votes to which each share of Series E Preferred
Stock shall be entitled shall be the quotient determined by dividing
251,189 by the number of shares of such Series E Preferred Stock then
outstanding.
(ii) In any matter requiring a separate class vote of holders of
Series E Preferred Stock or a separate vote of two or more series of
preferred stock voting together as a single class, for the purposes of
such a class vote, each share of Series E Preferred Stock shall be
entitled to one vote per share.
(iii) The affirmative vote of holders of not less than a majority of
Series E Preferred Stock shall be required to (A) authorize, increase the
authorized number of shares of or issue (including on conversion or
exchange of any convertible or exchangeable securities or by
reclassification) any shares of any class or classes of stock ranking
senior to or pari passu with the Series E Preferred Stock or any
additional shares of Series E Preferred Stock, (B) authorize, adopt or
approve each amendment to the Amended and Restated Certificate of
Incorporation of the Corporation that would increase or decrease the par
value of the shares of Series E Preferred Stock, alter or change the
powers, preferences or rights of the shares of Series E Preferred Stock or
alter or change the powers, preferences or rights of any other capital
stock of the Corporation if such alteration or change results in such
capital stock ranking senior to or pari passu with the Series E Preferred
Stock, (C) amend, alter or repeal any provision of the Amended and
Restated Certificate of Incorporation of the Corporation so as to affect
the shares of Series E Preferred Stock adversely, or (D) authorize or
issue any security convertible into, exchangeable for or evidencing the
right to purchase or otherwise receive any shares of any class or classes
of stock senior to or pari passu with the Series E Preferred Stock.
(e) Redemption at Option of the Corporation
The Corporation shall have the right to redeem shares of Series E
Preferred Stock pursuant to the following provisions:
(i) Subject to the restrictions set forth in Section 1(g)(i), the
Corporation shall have the right, at its sole option and election, to
redeem the shares of the Series E Preferred Stock, in whole but not in
part, at any time at a redemption price per share (the "Series E
Redemption Price") equal to the Liquidation Preference thereof as of the
redemption date; provided, that if the funds legally available to the
Corporation are insufficient to effect the redemption of the Series E
Preferred Stock in full, such funds shall be allocated among the shares of
Series E Preferred Stock ratably in accordance with the number of shares
of such Series outstanding as of the redemption date;
(ii) Notice of any redemption of the Series E Preferred Stock shall
be mailed at least ten but not more than 60 days prior to the date fixed
for redemption to each holder of Series E Preferred Stock to be redeemed,
at such holder's address as it appears on the books of the Corporation. In
order to facilitate the redemption of the Series E Preferred Stock, the
Board of Directors of the Corporation may fix a record date for the
determination of holders of Series E Preferred Stock to be redeemed, or
may cause the transfer books of the Corporation to be closed for the
transfer of the Series E Preferred Stock, not more than 60 days prior to
the date fixed for such redemption;
(iii) Within two Business Days after the redemption date specified
in the notice given pursuant to paragraph (ii) above and the surrender of
the certificate(s) representing shares of Series E Preferred Stock, the
Corporation shall pay to the holder of the shares being redeemed the
Series E Redemption Price therefor. Such payment shall be made by wire
transfer of immediately available funds to an account designated by such
holder or by overnight delivery (by a nationally recognized courier) of a
bank check to such holder's address as it appears on the books of the
Corporation; and
(iv) Effective upon the date of the notice given pursuant to
paragraph (ii) above, notwithstanding that any certificate for such shares
shall not have been surrendered for cancellation, the shares represented
thereby shall no longer be deemed outstanding, the rights to receive
dividends thereon shall cease to accrue from and after the date of
redemption designated in the notice of redemption and all rights of the
holders of the shares of the Series E Preferred Stock called for
redemption shall cease and terminate, excepting only the right to receive
the Series E Redemption Price therefor in accordance with paragraph (iii)
above.
(f) Redemption at Option of Holder
(i) No holder of shares of Series E Preferred Stock shall have any
right to require the Corporation to redeem any shares of Series E
Preferred Stock prior to, with respect to any shares of the Series E
Preferred Stock, December 13, 2020. Thereafter, subject to the
restrictions set forth in Section 1(g)(i), each holder of shares of Series
E Preferred Stock shall have the right, at the sole option and election of
such holder, to require the Corporation to redeem all (but not less than
all) of the shares of Series E Preferred Stock owned by such holder at a
price per share equal to the Series E Redemption Price;
(ii) The holder of any shares of the Series E Preferred Stock may
exercise such holder's right to require the Corporation to redeem such
shares by surrendering for such purpose to the Corporation, at its
principal office or at such other office or agency maintained by the
Corporation for that purpose, certificates representing the shares of
Series E Preferred Stock to be redeemed, accompanied by a written notice
stating that such holder elects to require the Corporation to redeem all
(but not less than all) of such shares in accordance with the provisions
of this Section 1(f), which notice may specify an account for delivery of
the Series E Redemption Price;
(iii) Within two Business Days after the surrender of such
certificates, the Corporation shall pay to the holder of the shares being
redeemed the Series E Redemption Price therefor. Such payment shall be
made by wire transfer of immediately available funds to an account
designated by such holder or by overnight delivery (by a nationally
recognized courier) of a bank check to such holder's address as it appears
on the books of the Corporation; and
(iv) Such redemptions shall be deemed to have been made at the close
of business on the date of the receipt of such notice and of such
surrender of the certificates representing the shares of the Series E
Preferred Stock to be redeemed and the rights of the holder thereof,
except for the right to receive the Series E Redemption Price therefor in
accordance herewith, shall cease on such date of receipt and surrender.
(g) Certain Restrictions
(i) Notwithstanding the provisions of Section 1(b) or Section 1(f),
cash dividends on the Series E Preferred Stock may not be declared, paid
or set apart for payment, nor may the Corporation redeem, purchase or
otherwise acquire any shares of Series E Preferred Stock, if (A) the
Corporation is not solvent or would be rendered insolvent thereby or (B)
at such time as the terms and provisions of any law or agreement of the
Corporation, including any agreement relating to its indebtedness,
specifically prohibit such declaration, payment or setting apart for
payment or such redemption, purchase or other acquisition, or provide that
such declaration, payment or setting apart for payment or such redemption,
purchase or other acquisition would constitute a violation or breach
thereof or a default thereunder.
(ii) The Corporation shall not permit any Subsidiary of the
Corporation, or cause any other Person, to make any distribution with
respect to, or purchase or otherwise acquire for consideration, any shares
of Common Stock or other shares of capital stock of the Corporation
ranking junior to or on a parity basis with the Series E Preferred Stock
unless the Corporation could, pursuant to paragraph (i) above, make such
distribution or purchase or otherwise acquire such shares at such time and
in such manner.
2. Share Certificates
(a) Each certificate representing the shares of Series E Preferred Stock
or delivered in substitution or exchange for any of the foregoing certificates
shall be stamped with a legend in substantially the following form, to the
extent that such legend is applicable pursuant to the provisions hereof:
"The securities represented by this Certificate have been acquired
for investment and have not been registered under the Securities Act
of 1933, as amended (the "Act"), or under any state securities or
`Blue Sky' laws. Said securities may not be sold, transferred,
assigned, pledged, hypothecated or otherwise disposed of, unless and
until registered under the Act and the rules and regulations
thereunder and all applicable state securities or `Blue Sky' laws or
exempted therefrom under the Act and all applicable state securities
or `Blue Sky' laws."
(b) Upon receipt of evidence reasonably satisfactory to the Corporation of
the loss, theft, destruction or mutilation of any certificate representing
shares of Series E Preferred Stock subject to this Agreement and of a bond or
other indemnity reasonably satisfactory to the Corporation, and upon
reimbursement to the Corporation of all reasonable expenses incident thereto,
and upon surrender of such certificate, if mutilated, the Corporation will make
and deliver a new certificate of like tenor in lieu of such lost, stolen,
destroyed or mutilated certificate.
3. Definitions
For the purposes of this Certificate of Designations, the following terms
shall have the meanings indicated:
"Business Day" shall mean any day other than a Saturday, Sunday or other
day on which commercial banks in the City of New York are authorized or required
by law or executive order to close.
"Closing Price" shall mean, with respect to each share of any class or
series of capital stock for any day, (i) the last reported sale price regular
way or, in case no such sale takes place on such day, the average of the closing
bid and asked prices regular way, in either case as reported on the principal
national securities exchange on which such class or series of capital stock is
listed or admitted for trading or (ii) if such class or series of capital stock
is not listed or admitted for trading on any national securities exchange, the
last reported sale price or, in case no such sale takes place on such day, the
average of the highest reported bid and the lowest reported asked quotation for
such class or series of capital stock, in either case as reported on NASDAQ or a
similar service if NASDAQ is no longer reporting such information.
"Common Stock" shall mean the Common Stock, $.01 par value per share, of
the Corporation.
"Lien" shall mean, with respect to any asset, any mortgage, lien, pledge,
charge, security interest, right of first refusal or right of others therein or
encumbrance of any nature whatsoever in respect of such asset.
"Liquidation Preference" shall mean, as of any date, and subject to
adjustment for subdivisions or combinations affecting the number of shares of
Series E Preferred Stock, with respect to each share of Series E Preferred
Stock, accrued and unpaid dividends thereon (if any), plus an amount equal to
interest on $1,000 at the rate of six percent (6%) per annum, compounded
quarterly, from the date of issuance of such share and, with respect to shares
of Series E Preferred Stock received in exchange for any share of capital stock
of any predecessor-in-interest to TeleCorp PCS, Inc. or its Subsidiaries, the
date when such capital stock was issued, to and including the date of the
calculation, less the amount of dividends (if any) theretofore declared and paid
in respect of such share.
"Market Price" shall mean, with respect to each share of any class or
series of capital stock for any day, (i) the average of the daily Closing Prices
for the ten consecutive trading days commencing 15 days before the day in
question or (ii) if on such date the shares of such class or series of capital
stock are not listed or admitted for trading on any national securities exchange
and are not quoted on NASDAQ or any similar service, the cash amount that a
willing buyer would pay a willing seller (neither acting under compulsion) in an
arm's-length transaction without time constraints per share of such class or
series of capital stock as of such date, viewing the Corporation on a going
concern basis, as determined in good faith by the Board of Directors of the
Corporation, whose determination shall be conclusive; provided that, in
determining such cash amount, the following shall be ignored: (i) any contract
or legal limitation in respect of shares of common stock or preferred stock of
the Corporation, including transfer, voting and other rights, and (ii) any
illiquidity arising by contract in respect of the shares of common stock and any
voting rights or control rights amongst the stockholders.
"NASDAQ" shall mean the National Association of Securities Dealers
Automated Quotations System.
"Person" shall mean any individual, firm, corporation, partnership, trust,
incorporated or unincorporated association, joint venture, joint stock company,
governmental agency or political subdivision thereof or other entity of any
kind, and shall include any successor (by merger or otherwise) of such entity.
"Series C Preferred Stock" has the meaning specified in Section 1(a).
"Series E Preferred Stock" has the meaning specified in the preamble
hereto.
"Series E Redemption Price" has the meaning specified in Section 1(e).
"Subsidiary" shall mean, with respect to any Person, a corporation or
other entity of which 50% or more of the voting power of the voting equity
securities or equity interest is owned, directly or indirectly, by such Person.
"Transfer" shall mean any direct or indirect transfer, sale, assignment,
pledge, encumbrance, tender, or otherwise grant, creation or sufferage of a Lien
in or upon, giving, placement in trust or otherwise (including transfers by
testamentary or intestate succession) disposing of by operation of law or any
short sale, collar, or hedging transaction or other derivative transaction that
has the effect of materially changing the economic benefits and risks of
ownership.
IN WITNESS WHEREOF, the Corporation has caused this Certificate to be duly
executed by the Secretary of the Corporation as of October __, 2001.
AT&T WIRELESS SERVICES, INC.
By
----------------------------------
Name:
Title:
EXHIBIT C
FORM OF
AFFILIATES LETTER
_______________, _____
AT&T Wireless Services, Inc.
0000 000xx Xxx. XX, Xxxx. 0
Xxxxxxx, XX 00000
Ladies and Gentlemen:
The undersigned has been advised that as of the date of this letter
agreement the undersigned may be deemed to be an "affiliate" of TeleCorp PCS,
Inc., a Delaware corporation ("TeleCorp"), as the term "affiliate" is defined
for purposes of paragraphs (c) and (d) of rule 145 of the rules and regulations
of the Securities and Exchange Commission (the "Commission") under the
Securities Act of 1933, as amended (the "Act"). Execution of this letter shall
not be construed as an admission of "affiliate" status or as a waiver of any
rights that the undersigned may have to object to a claim that the undersigned
is an "affiliate" on or after the date of this letter.
Pursuant to the terms of the Agreement and Plan of Merger, dated as
of October [ ], 2001 (the "Merger Agreement"), among TeleCorp, AT&T Wireless
Services, Inc., a Delaware corporation ("AT&T Wireless"), and TL Acquisition
Corp., a Delaware corporation and wholly owned subsidiary of AT&T Wireless
("Merger Sub"), TeleCorp will be merged with and into Merger Sub, with TeleCorp
to be the surviving corporation in the merger (the "Merger"). As a result of the
Merger, the undersigned will receive shares of AT&T Wireless Capital Stock (as
defined in the Merger Agreement, the "AT&T Wireless Capital Stock")) in exchange
for shares of TeleCorp Capital Stock (as defined the in the Merger Agreement,
the "TeleCorp Capital Stock").
The undersigned represents, warrants and covenants with and to AT&T
Wireless that in the event the undersigned receives any AT&T Wireless Capital
Stock as a result of the Merger:
(a) The undersigned will not sell, transfer or otherwise dispose of
such AT&T Wireless Capital Stock unless (a) either (i) such sale, transfer or
other disposition has been registered under the Act, (ii) such sale, transfer or
other disposition is made in conformity with the provisions of Rule 145 under
the Act (as such rule may be hereafter from time to time amended), or (iii) in
the opinion of counsel in form and substance reasonably satisfactory to AT&T
Wireless, or under a "no action" letter obtained by the undersigned from the
staff of the Commission, such sale, transfer or other disposition will not
violate or is otherwise exempt from registration under the Act and (b) such
sale, transfer or other disposition otherwise complies with all applicable laws.
(b) The undersigned has carefully read this letter agreement and the
Merger Agreement and discussed the requirements of such documents and other
applicable limitations upon the undersigned's ability to sell, transfer or
otherwise dispose of the AT&T Wireless Capital Stock to the extent the
undersigned felt necessary with the undersigned's counsel or counsel for
TeleCorp.
(c) The undersigned understands that AT&T Wireless is under no
obligation to register the sale, transfer or other disposition of the AT&T
Wireless Capital Stock by the undersigned or on the undersigned's behalf under
the Act or to take any other action necessary in order to enable such sale,
transfer or other disposition by the undersigned in compliance with an exemption
from such registration.
(d) The undersigned also understands that stop transfer instructions
will be given to AT&T Wireless's transfer agent with respect to the shares of
AT&T Wireless Capital Stock issued to the undersigned and that there will be
placed on the certificates for the AT&T Wireless Capital Stock issued to the
undersigned or any substitution thereof, a legend stating in substance:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE WERE ISSUED IN A
TRANSACTION TO WHICH RULE 145 PROMULGATED UNDER THE SECURITIES ACT
OF 1933 APPLIES. THE SECURITIES REPRESENTED BY THIS CERTIFICATE MAY
BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF ONLY IN ACCORDANCE
WITH THE TERMS OF A LETTER AGREEMENT BETWEEN THE REGISTERED HOLDER
HEREOF AND AT&T WIRELESS SERVICES, INC., A COPY OF WHICH AGREEMENT
IS ON FILE AT THE PRINCIPAL OFFICES OF AT&T WIRELESS SERVICES, INC."
(e) The undersigned also understands that, unless the transfer by
the undersigned of the AT&T Wireless Capital Stock issued to the undersigned has
been registered under the Act or is a sale made in conformity with the
provisions of Rule 145(d) under the Act, AT&T Wireless reserves the right to put
the following legend on the certificates issued to the undersigned's transferee:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933 AND WERE ACQUIRED FROM A
PERSON WHO RECEIVED SUCH SECURITIES IN A TRANSACTION TO WHICH RULE
145 PROMULGATED UNDER THE SECURITIES ACT OF 1933 APPLIES. THE
SECURITIES HAVE NOT BEEN ACQUIRED BY THE HOLDER WITH A VIEW TO, OR
FOR RESALE IN CONNECTION WITH, ANY DISTRIBUTION THEREOF WITHIN THE
MEANING OF THE SECURITIES ACT OF 1933 AND MAY NOT BE SOLD,
TRANSFERRED OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT OR IN ACCORDANCE WITH AN EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT OF 1933."
It is understood and agreed that the legends set forth in paragraphs
(d) and (e) above shall be removed by delivery of substitute certificates
without such legend if (i) the securities represented thereby have been
registered for sale by the undersigned under the Act or (ii) (A) in the case of
common stock of AT&T Wireless, AT&T Wireless has received either an opinion of
counsel, which opinion and counsel shall be reasonably satisfactory to AT&T
Wireless, or a "no-action" letter obtained by the undersigned from the staff of
the Commission, to the effect that the restrictions imposed by Rule 145 under
the Act no longer apply to the undersigned, or (B) in the case of AT&T Wireless
Capital Stock other than common stock of AT&T Wireless, AT&T Wireless has
received an opinion of counsel, which opinion and counsel shall be reasonably
satisfactory to AT&T Wireless, to the effect set forth in clause (ii)(A) hereof
and confirming that any sale of or transfer of any such shares will not require
registration under the Act or under any blue sky or similar laws.
(f) The undersigned further understands and agrees that the
representations, warranties, covenants and agreements of the undersigned set
forth herein are for the benefit of AT&T Wireless and will be relied upon by
AT&T Wireless and its counsel and accountants.
(g) The undersigned further represents, warrants and covenants with
and to AT&T Wireless that the undersigned will, and will cause each of the other
parties whose shares are deemed to be beneficially owned by the undersigned
pursuant to paragraph (h) below to, have all shares of TeleCorp Capital Stock
owned by the undersigned or such parties registered in the name of the
undersigned or such parties, as applicable, prior to the effective date of the
Merger and not in the name of any bank, broker-dealer, nominee or clearing
house.
(h) The undersigned understands and agrees that this letter
agreement shall apply to all shares of the capital stock of AT&T Wireless and
TeleCorp that are deemed to be beneficially owned by the undersigned pursuant to
applicable federal securities laws.
Very truly yours,
---------------------------------------
Name:
[add below the signatures of all registered
owners of shares deemed beneficially owned
by the affiliate.]
---------------------------------------
Name:
---------------------------------------
Name:
---------------------------------------
Name:
Acknowledged this ___
day of _____________, ____.
AT&T Wireless Services, Inc.
By:
------------------------------
Name:
Title:
EXHIBIT D
APPLE A2E TAX REPRESENTATION LETTER
[Letterhead of APPLE]
[________ __], 2001
Wachtell, Lipton, Xxxxx & Xxxx
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Cadwalader, Xxxxxxxxxx & Xxxx
000 Xxxxxx Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Re: The Merger of [Merger Sub] with and into [Titan]
------------------------------------------------
Ladies and Gentlemen:
In connection with the opinions to be delivered pursuant to the
Agreement and Plan of Merger (the "Merger Agreement") dated as of [__], 2001, by
and among [Apple], a Delaware corporation ("Parent"), [Merger Sub], a Delaware
corporation and a direct wholly-owned subsidiary of Parent ("Merger Sub"), and
[Titan], a Delaware corporation (the "Company"), the undersigned certifies and
represents on behalf of Parent and Merger Sub and as to Parent and Merger Sub,
after due inquiry and investigation, as follows (any capitalized term used but
not defined herein shall have the meaning given to such term in the Merger
Agreement):
1. The facts relating to the contemplated merger (the "Merger") of
Merger Sub with and into the Company pursuant to the Merger Agreement, as
described in the Merger Agreement and the documents described in the Merger
Agreement are, insofar as such facts pertain to Parent and Merger Sub, true,
correct and complete in all material respects. The Merger will be consummated
strictly in accordance with the Merger Agreement and none of the material terms
and conditions therein related to the Merger has been or will be waived or
modified. The facts that relate to the Merger and related transactions, as
described in the Registration Statement on Form S-4 filed in connection with the
Merger and the proxy statement-prospectus (the "Proxy Statement-Prospectus")
contained therein, each as amended or supplemented through the date hereof, are
true, correct, and complete in all material respects and will be true, correct,
and complete in all material respects at the Effective Time. The Merger is being
effected for bona fide business reasons.
2. The fair market value of the voting common stock, par value $.01
per share, of Parent ("Parent Common Stock"), the Series C Preferred Stock of
Parent (the "Parent Series C Preferred Stock") to be designated as having terms
substantially as set forth in the form of the Series C Preferred Certificate of
Designation attached as Exhibit A to the Merger Agreement, and the Preferred
Stock of Parent to be designated as Series E Preferred Stock of Parent, having
terms substantially as set forth in the form of the Series E Preferred
Certificate of Designation attached as Exhibit B to the Merger Agreement
(together with the Parent Series C Preferred Stock, the "Parent Preferred
Stock"; the Parent Common Stock and the Parent Preferred Stock, the "Parent
Stock"), and cash in lieu of a fractional share of Parent Stock to be received
by each shareholder of the Company in the Merger will be approximately equal to
the fair market value of the Class A Voting Common Stock, par value $0.01 per
share, of the Company (the "Company Class A Common Stock"), the Class C Common
Stock, par value $0.01 per share, of the Company (the "Company Class C Common
Stock"), the Class D Common Stock, par value $0.01 per share, of the Company
(the "Company Class D Common Stock"), the Class E Common Stock, par value $0.01
per share, of the Company (the "Company Class E Common Stock"), the Class F
Common Stock, par value $0.01 per share, of the Company (the "Company Class F
Common Stock"), and the Voting Preference Common Stock, par value $0.01 per
share, of the Company (the "Company Voting Preference Common Stock", and
together with the Company Class A Common Stock, the Company Class C Common
Stock, the Company Class D Common Stock, the Company Class E Common Stock, and
the Company Class F Common Stock, the "Company Common Stock), and the Series A
Convertible Preferred Stock, par value $0.01 per share, of the Company (the
"Company Series A Preferred Stock"), the Series B Preferred Stock, par value
$0.01 per share, of the Company (the "Company Series B Preferred Stock"), the
Series C Preferred Stock, par value $0.01 per share, of the Company (the
"Company Series C Preferred Stock"), the Series D Preferred Stock, par value
$0.01 per share, of the Company (the "Company Series D Preferred Stock, the
Series E Preferred Stock, par value $0.01 per share, of the Company (the
"Company Series E Preferred Stock"), the Series F Preferred Stock, par value
$0.01 per share, of the Company (the "Company Series F Preferred Stock"), and
the Series G Preferred Stock, par value $0.01 per share, of the Company (the
Company Series G Preferred Stock", together with the Company Common Stock, the
Company Series A Preferred Stock, the Company Series B Preferred Stock, the
Company Series C Preferred Stock, the Company Series D Preferred Stock, the
Company Series E Preferred Stock, and the Company Series F Preferred Stock, the
"Company Stock"), surrendered in exchange therefore. The consideration to be
received in the Merger by holders of Company Stock was determined by arm's
length negotiations between the managements of Parent and the Company.
3. In connection with the Merger, no holder of Company Stock will
receive in exchange for Company Stock, directly or indirectly, any consideration
from Parent or Merger Sub other than Parent Stock, cash in lieu of a fractional
share thereof, and cash paid to dissenting shareholders of the Company.
4. Following the Merger, the Company will hold at least 90% of the
fair market value of the net assets and at least 70% of the fair market value of
the gross assets held by the Company and Merger Sub, as the case may be,
immediately prior to the Merger. For purposes of this representation, amounts
paid by the Company or Merger Sub to shareholders who receive cash or other
property (including cash in lieu of fractional shares of Parent Stock), amounts
used by the Company and Merger Sub to pay reorganization expenses incurred in
connection with the Merger and all redemptions and distributions (except for
regular, normal dividends) made by the Company immediately preceding, or in
contemplation of, the Merger will be considered assets held by the Company or
Merger Sub, as the case may be, immediately prior to the Merger.
5. At least 50 percent of the value of the shareholders' proprietary
interests in Company will be preserved as a proprietary interest in Parent
received in exchange for Company Stock. Proprietary interests in Company will
not be preserved to the extent that: (i) consideration received prior to the
Merger, either in a redemption of Company Stock or in a distribution with
respect to Company Stock, is treated as other property or money received in the
exchange for purposes of Section 356, or would be so treated if the Company
shareholder also had received Parent Stock in exchange for Company Stock; (ii)
Parent or a person related to Parent as defined in Treasury Regulation Section
1.368-1(e)(3) (a "Parent Related Person") acquires Company Stock for
consideration other than Parent Stock in connection with the merger; or (iii)
Parent Stock received in the Merger in exchange for Company Stock is redeemed or
otherwise acquired by Parent or a Parent Related Person for consideration other
than Parent Stock in connection with the Merger, other than acquisitions which
are made on the open market through a broker at the prevailing market price from
a shareholder whose identity is not known to Parent and are made pursuant to a
stock repurchase program that was not a matter negotiated with Company or any
Company shareholder, does not favor participation by any Company shareholder and
pursuant to which the number of shares repurchased does not exceed the number of
Parent shares outstanding prior to the Merger (a "Parent Stock Repurchase
Program"). Parent is not aware of any extraordinary distribution with respect to
Company Stock that has occurred or is intended, in each case, in connection with
the Merger. Parent also has not participated, and in connection with the Merger,
will not participate, in a redemption or acquisition of Company Stock made by
Company or a person related to Company as defined in Treasury Regulation Section
1.368-1(e)(3) (a "Company Related Person"). Any reference to Parent or Company
in this paragraph includes a reference to any successor or predecessor of such
corporation, except that Company is not treated as a predecessor of Parent and
Parent is not treated as a successor of Company. Each partner of a partnership
will be treated as owning or acquiring any stock owned or acquired, as the case
may be, by the partnership (and as having paid any consideration paid by the
partnership to acquire such stock) in accordance with that partner's interest in
the partnership. For purposes of this Officer's Certificate, an acquisition of
Parent Stock or Company Stock by a person pursuant to any transaction,
agreement, arrangement or other understanding with Parent, Company, a Parent
Related Person or a Company Related Person will be treated as made by Parent,
Company, the Parent Related Person or the Company Related Person, respectively.
Parent has no plan or intention to reacquire any of its stock issued in the
Merger, either directly or through any transaction, agreement, arrangement or
other understanding with a Parent Related Person, except for any plan or
intention to reacquire such stock pursuant to the Parent Stock Repurchase Plan.
6. Other than transactions described in the Transfer Agreement,
Parent has no present plan or intention to (i) liquidate the Company, (ii) merge
the Company with or into another corporation or entity (or to convert the
Company into a "disregarded" entity within the meaning of Treasury Regulation
section 301.7701-3), (iii) sell or otherwise dispose of any stock of the
Company, except for transfers (including successive transfers) of such stock to
corporations controlled by the transferor, or (iv) cause the Company to sell or
otherwise dispose of any of its assets, or any assets that it acquired from
Merger Sub, except for (w) dispositions in the ordinary course of its business,
(x) transactions described in the Transfer Agreement, (y) transfers (including
successive transfers) of assets to one or more corporations controlled in each
transfer by the transferor or transfers permitted under Treasury Regulation
sections 1.368-2(f), -2(k) and -1(d)(4), or (z) arm's length dispositions to
persons not related to Parent other than dispositions which would result in
Parent ceasing to use a significant portion of the Company's historic business
assets in a business and provided that the consideration is retained or
reinvested in the business. Parent has no plan or intention to cause the Company
to issue any additional shares of stock following the Merger, or take any other
action, that could result in Parent losing control of the Company following the
Merger. For purposes of this paragraph, control with respect to a corporation
shall mean ownership of at least (i) 80% of the total combined voting power of
all classes of stock entitled to vote, and (ii) 80% of the total number of
shares of each other class of stock of the corporation.
7. Following the Merger, the Company, Parent or another member of
Parent's "qualified group" will continue the Company's historic business or use
a significant portion of the Company's historic business assets in a business.
For purposes of this representation, Parent's "qualified group" means one or
more chains of corporations connected through stock ownership with the Parent,
but only if the Parent directly owns at least (i) 80% of the total combined
voting power of all classes of stock entitled to vote, and (ii) 80% of the total
number of shares of each other class of stock, in at least one other
corporation, and at least (x) 80% of the total combined voting power of all
classes of stock entitled to vote, and (y) 80% of the total number of shares of
each other class of stock, in each of the corporations (except Parent) is owned
directly by one of the other corporations. For purposes of this test, Parent and
such members (i) shall be deemed to own that portion of the assets of a
partnership reflecting their interest therein, and (ii) shall be treated as
conducting the business of a partnership of which they are members, provided
that (A) they own in the aggregate at least a 33 1/3% capital and profits
interest in such partnership, or (B) they own in the aggregate at least a 20%
capital and profits interest in such partnership and perform active and
substantial management functions with respect thereto.
8. Prior to the Merger and at the Effective Time, Parent will own
all of the outstanding stock of Merger Sub. Parent has no plan or intention to
cause Merger Sub to, and Merger Sub has no plan or intention to, issue
additional shares of its stock that would result in Parent owning less than all
of the capital stock of Merger Sub.
9. Merger Sub has been newly formed solely to effect the Merger and
at no time has or will Merger Sub conduct any business or other activities other
than the issuance of its stock to Parent prior to the Merger or activities
necessary to effectuate the Merger. Merger Sub will have no liabilities that
will be assumed by the Company and it will not transfer any assets to the
Company in the Merger that are subject to any liabilities.
10. Pursuant to the Merger, at least (i) 80% of the total combined
voting power of all classes of Company stock entitled to vote and (ii) 80% of
each other class of stock of the Company will be exchanged solely for voting
Parent Stock. For purposes of this representation, shares of Company Stock
exchanged for cash or other property originating with Parent or Merger Sub will
be treated as outstanding Company Stock at the Effective Time.
11. Except as provided in the Merger Agreement, Parent, Merger Sub,
the Company and holders of Company Stock will each pay their respective
expenses, if any, incurred in connection with the Merger. To the extent any
expenses related to the Merger will be funded directly or indirectly by a party
other than the incurring party, such expenses will be solely and directly
related to the Merger, and will not include (i) expenses incurred for investment
or estate planning advice to shareholders or (ii) expenses incurred by an
individual shareholder or group of shareholders for legal, accounting or
investment advice or counsel relating to the Merger. Parent has not agreed to
assume, nor will it directly or indirectly assume, any expense or other
liability, whether fixed or contingent, of any holder of Company Stock in
connection with or as part of the Merger or any related transaction; provided
further that all liability for Taxes incurred by a holder of Company Stock will
be paid by such shareholder of the Company and in no event by Parent or a
related person, directly or indirectly.
12. There is no and will be no intercorporate indebtedness existing
between Parent or its subsidiaries and the Company or its subsidiaries that was
issued, acquired or will be settled at a discount.
13. Neither Parent nor Merger Sub will (i) elect, or have in effect
an election, to be treated as a "regulated investment company" or as a "real
estate investment trust," or (ii) be an "investment company" as defined in
section 368(a)(2)(F)(iii) and (iv) of the Code.
14. As of the Effective Time, the only Company Stock, or other
securities, options, warrants or instruments giving Parent the right to acquire
Company Stock held by Parent is (i) 97,472.84 shares of the Company Series A
Preferred Stock, (ii) 90,668.33 shares of the Company Series B Preferred Stock,
(iii) 3,070.58 shares of the Company Series C Preferred Stock, (iv) 49,416.98
shares of the Company Series D Preferred Stock, (v) 14,912,778 shares of the
Company Series F preferred stock, (vi) 46,374 shares of the Company Series G
Preferred Stock, (vii) 18,288,835 shares of the Company Class A Common Stock,
(viii) 20,902 shares of the Company Class D Common Stock, and (iv) 2,309.31
shares of the Company Class F Common Stock.
15. The Parent Stock into which the Company Stock will be converted
in the Merger will be "voting stock" within the meaning of Section 368 of the
Code.
16. None of the compensation to be received by any shareholder-
employee of the Company will be separate consideration for, or allocable to, any
of such employee's shares of Company Stock; none of the Parent Stock to be
received by any shareholder-employee of the Company in connection with the
Merger will be separate consideration for, or allocable to, any employment,
consulting or similar agreement; and the compensation paid to any
shareholder-employee of the Company will be for services actually rendered and
will be determined by bargaining at arm's length.
17. The payment of cash in lieu of fractional shares of Parent Stock
is solely for the purpose of avoiding the expense and inconvenience to Parent of
issuing fractional shares and does not represent separately bargained-for
consideration. The total cash consideration that will be paid in the Merger to
holders of Company Stock instead of issuing fractional shares of Parent Stock is
not expected to exceed 1% of the total consideration that will be issued in the
Merger to the Company shareholders in exchange for their shares of Company
Stock. The fractional share interests of each Company shareholder will be
aggregated, and no Company shareholder, with the possible exception of
shareholders whose holdings are in multiple accounts or with multiple brokers,
will receive cash in an amount equal to or greater than one full share of Parent
Stock.
18. Parent is not aware of, and has not participated in, any plan of
the Company (or a person related to the Company) to effect (i) an extraordinary
distribution with respect to Company Stock or (ii) any redemption or acquisition
of Company Stock (other than the acquisition of Company Stock in the Merger).
19. At the time of the merger of Titan with [Tap] on November 13,
2000 neither Parent nor, to the best knowledge of Parent's management, the
Company's management, had any plan or expectation, to effect, or engaged in any
discussions, negotiations, agreements or arrangements regarding, the Merger.
20. At the Effective Time, neither Parent nor Merger Sub will be
under the jurisdiction of a court in a "Title 11 or similar case". For purposes
of the foregoing, a "Title 11 or similar case" means a case under Title 11 of
the United States Code or a receivership, foreclosure or similar proceeding in a
Federal or state court.
21. The undersigned is authorized to make all the representations
set forth herein on behalf of Parent.
We understand that Cadwalader, Xxxxxxxxxx & Xxxx and Wachtell,
Lipton, Xxxxx & Xxxx will rely, without further inquiry, on this representation
letter in rendering their respective opinions as to certain United States
Federal income tax consequences of the Merger. We will promptly and timely
inform them if, after signing this representation letter, we have reason to
believe that any of the facts described herein or in the Proxy
Statement-Prospectus or any of the representations made in this representation
letter are or have become untrue, incorrect or incomplete in any respect.
Very truly yours,
PARENT
______________________________
By:
Title:
Exhibit E
TITAN A2E TAX REPRESENTATION LETTER
[Letterhead of TITAN]
[_______ __], 2001
Cadwalader, Xxxxxxxxxx & Xxxx
000 Xxxxxx Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Wachtell, Lipton, Xxxxx & Xxxx
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Re: The Merger of [Merger Sub] with and into [Titan]
------------------------------------------------
Ladies and Gentlemen:
In connection with the opinions to be delivered pursuant to the
Agreement and Plan of Merger (the "Merger Agreement"), dated [_____], by and
among [Apple], a Delaware corporation ("Parent"), [Merger Sub], a Delaware
corporation and a direct wholly-owned subsidiary of Parent ("Merger Sub"), and
[Titan], a Delaware corporation (the "Company"), the undersigned certifies and
represents on behalf of the Company and as to the Company, after due inquiry and
investigation, as follows (any capitalized term used but not defined herein
shall have the meaning given to such term in the Merger Agreement):
1. The facts relating to the contemplated merger (the "Merger") of
Merger Sub with and into the Company pursuant to the Merger Agreement, as
described in the Merger Agreement and the documents described in the Merger
Agreement are, insofar as such facts pertain to the Company, true, correct and
complete in all material respects. The Merger will be consummated strictly in
accordance with the Merger Agreement and none of the material terms and
conditions therein related to the Merger has been or will be waived or modified.
The facts that relate to the Merger and related transactions, as described in
the Registration Statement on Form S-4 filed in connection with the Merger and
the proxy statement-prospectus (the "Proxy Statement-Prospectus") contained
therein, each as amended or supplemented through the date hereof, are true,
correct, and complete in all material respects and will be true, correct, and
complete in all material respects at the Effective Time. The Merger is being
effected for bona fide business reasons.
2. The fair market value of the voting common stock, par value $.01
per share, of Parent ("Parent Common Stock"), the Series C Preferred Stock of
Parent (the "Parent Series C Preferred Stock") to be designated as having terms
substantially as set forth in the form of the Series C Preferred Certificate of
Designation attached as Exhibit A to the Merger Agreement, and the Preferred
Stock of Parent to be designated as Series E Preferred Stock of Parent, having
terms substantially as set forth in the form of the Series E Preferred
Certificate of Designation attached as Exhibit B to the Merger Agreement
(together with the Parent Series C Preferred Stock, the "Parent Preferred
Stock"; the Parent Common Stock and the Parent Preferred Stock, the "Parent
Stock"), and cash in lieu of a fractional share of Parent Stock received by each
shareholder of the Company in the Merger will be approximately equal to the fair
market value of the Class A Voting Common Stock, par value $0.01 per share, of
the Company (the "Company Class A Common Stock"), the Class C Common Stock, par
value $0.01 per share, of the Company (the "Company Class C Common Stock"), the
Class D Common Stock, par value $0.01 per share, of the Company (the "Company
Class D Common Stock"), the Class E Common Stock, par value $0.01 per share, of
the Company (the "Company Class E Common Stock"), the Class F Common Stock, par
value $0.01 per share, of the Company (the "Company Class F Common Stock"), and
the Voting Preference Common Stock, par value $0.01 per share, of the Company
(the "Company Voting Preference Common Stock", and together with the Company
Class A Common Stock, the Company Class C Common Stock, the Company Class D
Common Stock, the Company Class E Common Stock, and the Company Class F Common
Stock, the "Company Common Stock), and the Series A Convertible Preferred Stock,
par value $0.01 per share, of the Company (the "Company Series A Preferred
Stock"), the Series B Preferred Stock, par value $0.01 per share, of the Company
(the "Company Series B Preferred Stock"), the Series C Preferred Stock, par
value $0.01 per share, of the Company (the "Company Series C Preferred Stock"),
the Series D Preferred Stock, par value $0.01 per share, of the Company (the
"Company Series D Preferred Stock, the Series E Preferred Stock, par value $0.01
per share, of the Company (the "Company Series E Preferred Stock"), the Series F
Preferred Stock, par value $0.01 per share, of the Company (the "Company Series
F Preferred Stock"), and the Series G Preferred Stock, par value $0.01 per
share, of the Company (the Company Series G Preferred Stock", together with the
Company Common Stock, the Company Series A Preferred Stock, the Company Series B
Preferred Stock, the Company Series C Preferred Stock, the Company Series D
Preferred Stock, the Company Series E Preferred Stock, and the Company Series F
Preferred Stock, the "Company Stock"), surrendered in exchange therefore. The
consideration to be received in the Merger by holders of Company Stock was
determined by arm's length negotiations between the managements of Parent and
the Company.
3. In connection with the Merger, no holder of Company Stock will
receive in exchange for Company Stock, directly or indirectly, any consideration
from Parent or Merger Sub other than Parent Stock, cash in lieu of a fractional
share thereof, and cash paid to dissenting shareholders of the Company.
4. At least 50 percent of the value of the shareholders' proprietary
interests in Company will be preserved as a proprietary interest in Parent
received in exchange for Company Stock. Proprietary interests in Company will
not be preserved to the extent that: (i) consideration received prior to the
Merger, either in a redemption of Company Stock or in a distribution with
respect to Company Stock, is treated as other property or money received in the
exchange for purposes of Section 356, or would be so treated if the Company
shareholder also had received Parent Stock in exchange for Company Stock; (ii)
Parent or a person related to Parent as defined in Treasury Regulation Section
1.368-1(e)(3) (a "Parent Related Person") acquires Company Stock for
consideration other than Parent Stock in connection with the Merger; or (iii)
Parent Stock received in the Merger in exchange for Company Stock is redeemed or
otherwise acquired by Parent or a Parent Related Person for consideration other
than Parent Stock in connection with the Merger, other than acquisitions which
are made on the open market through a broker at the prevailing market price from
a shareholder whose identity is not known to Parent and are made pursuant to a
stock repurchase program that was not a matter negotiated with Company or any
Company shareholder, does not favor participation by any Company shareholder and
pursuant to which the number of shares repurchased does not exceed the number of
Parent shares outstanding prior to the Merger. Company has not caused, and in
connection with the Merger, will not cause, an extraordinary distribution with
respect to its shares to occur. Neither Company nor a person related to Company
as defined in Treasury Regulation Section 1.368-1(e)(3) (a "Company Related
Person") has participated, in connection with the Merger, nor will it so
participate, in a redemption or acquisition of Company Stock. Neither Company,
any Company Related Person nor any affiliate of Company, has paid or will pay,
in connection with the Merger, any amount to, or on behalf of, any Company
shareholder in connection with any sale, redemption or other disposition of any
Company Stock. Any reference to Parent or Company in this paragraph includes a
reference to any successor or predecessor of such corporation, except that
Company is not treated as a predecessor of Parent and Parent is not treated as a
successor of Company. Each partner of a partnership will be treated as owning or
acquiring any stock owned or acquired, as the case may be, by the partnership
(and as having paid any consideration paid by the partnership to acquire such
stock) in accordance with that partner's interest in the partnership. For
purposes of this Officer's Certificate, an acquisition of Parent Stock or
Company Stock by a person pursuant to any transaction, agreement, arrangement or
other understanding with Parent, Company, a Parent Related Person or a Company
Related Person will be treated as made by Parent, Company, the Parent Related
Person or the Company Related Person, respectively. It is understood for
purposes of this representation that 3 shares of Titan Voting Preference Stock
held by Xxxxxxx X. Xxxxxxx, XX may be put to [Tap] after November 13, 2001.
5. The payment of cash in lieu of fractional shares of Parent Stock
is made solely for the purpose of avoiding the expense and inconvenience to
Parent of issuing fractional shares and does not represent separately bargained
for consideration. The total cash consideration that will be paid in the Merger
to holders of Company Stock instead of issuing fractional shares of Parent Stock
is not expected to exceed 1% of the total consideration that will be issued in
the Merger to the Company shareholders in exchange for their shares of Company
Stock. The fractional share interests of each Company shareholder will be
aggregated, and no Company shareholder, with the possible exception of
shareholders whose holdings are in multiple accounts or with multiple brokers,
will receive cash in an amount equal to or greater than one full share of Parent
Stock.
6. The Company has no plan or intention to issue any additional
shares of stock that would cause Parent to own less than (i) 80% of the total
combined voting power of all classes of Company stock entitled to vote, or (ii)
80% of each other class of stock in the Company.
7. The Company has not made and does not have any present plan or
intention to make any distributions (other than dividends made in the ordinary
course of business) prior to, in contemplation of or otherwise in connection
with, the Merger.
8. Immediately following the Merger, the Company will hold (i) at
least 90% of the fair market value of the net assets and at least 70% of the
fair market value of the gross assets that were held by the Company immediately
prior to the Merger. For purposes of this representation, amounts used to repay
debt, amounts paid by the Company to shareholders who receive cash or other
property (including cash in lieu of fractional shares of Parent Stock) in
connection with the Merger, and all redemptions and distributions (except for
regular, normal dividends) made by the Company immediately preceding, or in
contemplation of, the Merger, including any dispositions described in the
Transfer Agreement, will be considered assets held by the Company immediately
prior to the Merger. Any dispositions of assets held by the Company prior to the
Merger which are made in contemplation of, or as part of the Merger will be for
fair market value, and the proceeds thereof will be retained by the Company.
9. At the Effective Time, the Company will not have outstanding any
warrants, options, convertible securities or any other type of right pursuant to
which any person could acquire Company Stock that, if exercised or converted,
would affect Parent's acquisition or retention of control of the Company, as
defined in Section 368(c) of the Code.
10. As of the date hereof, the only capital stock of the Company is
the Company Stock. Since the date of the Merger Agreement the Company has not
issued any additional shares of Company Stock. The Company Stock is "voting
stock" within the meaning of Section 368 of the Code.
11. Except as provided in the Merger Agreement, Parent, Merger Sub,
the Company and holders of Company Stock will each pay their respective
expenses, if any, incurred in connection with the Merger. To the extent any
expenses related to the Merger will be funded directly or indirectly by a party
other than the incurring party, such expenses will be solely and directly
related to the Merger, and will not include (i) expenses incurred for investment
or estate planning advice to shareholders or (ii) expenses incurred by an
individual shareholder or group of shareholders for legal, accounting or
investment advice or counsel relating to the Merger. Parent has not agreed to
assume, nor will it directly or indirectly assume, any expense or other
liability, whether fixed or contingent, of any holder of Company Stock in
connection with or as part of the Merger or any related transaction; provided
further that all liability for Taxes incurred by a holder of Company Stock will
be paid by such shareholder of the Company and in no event by Parent or a
related person, directly or indirectly.
12. Pursuant to the Merger, at least (i) 80% of the total combined
voting power of all classes of Company stock entitled to vote, and (ii) 80% of
each other class of stock of the Company, will be exchanged solely for voting
Parent Stock. For purposes of this representation, shares of the Company Stock
exchanged for cash or other property originating with the Parent or Merger Sub
will be treated as outstanding Company Stock on the date of the Merger.
13. To the best knowledge of the management of the Company, Parent
will neither (i) assume any liabilities of the shareholders of the Company in
the Merger, nor (ii) take subject to any liabilities any Company Stock acquired
in the Merger. Furthermore, to the knowledge of the management of the Company,
there is no plan or intention for Parent to assume any liabilities of the
Company.
14. The Company will not (i) elect, or have in effect an election,
to be treated as a "regulated investment company" or as a "real estate
investment trust," or (ii) be an "investment company" as defined in section
368(a)(2)(F)(iii) and (iv) of the Code.
15. None of the compensation to be received by any shareholder-
employee of the Company will be separate consideration for, or allocable to, any
of such employee's shares of Company Stock; none of the Parent Stock to be
received by any shareholder-employee of the Company in connection with the
Merger will be separate consideration for, or allocable to any employment,
consulting or similar agreement; and the compensation paid to any
shareholder-employee of the Company will be for services actually rendered and
will be determined by bargaining at arm's-length.
16. There is no intercorporate indebtedness existing between Parent
or its subsidiaries, and the Company or its subsidiaries that was issued,
acquired or will be settled at a discount.
17. At the Effective Time, the Company will not be under the
jurisdiction of a court in a "Title 11 or similar case". For purposes of the
foregoing, a "Title 11 or similar case" means a case under Title 11 of the
United States Code or a receivership, foreclosure or similar proceeding in a
Federal or state court.
18. No assets of the Company have been sold, transferred or
otherwise disposed of which would prevent Parent from continuing the "historic
business" of the Company or from using a significant portion of the "historic
business assets" of the Company in a business following the Merger (as such
terms are defined in Treasury Regulation Section 1.368-1(d)).
19. The merger of Titan with [Tap] on November 13, 2000 (the
"Titan-[Tap] Merger") was motivated by a business purpose separate from and
unrelated to the Merger. At the time of the Titan-[Tap] Merger neither the
Company nor, to the best knowledge of the Company's management, Parent's
management, had any plan or expectation, to effect, or engaged in any
discussions, negotiations, agreements or arrangements regarding, the Merger.
20. On the date of the Merger, the fair market value of the assets
of the Company will exceed the sum of its liabilities, plus the amount of
liabilities, if any, to which such assets are subject.
21. The undersigned is authorized to make all the representations
set forth herein on behalf of the Company.
We understand that Cadwalader, Xxxxxxxxxx & Xxxx and Wachtell,
Lipton, Xxxxx & Xxxx will rely, without further inquiry, on this representation
letter in rendering their respective opinions as to certain United States
Federal income tax consequences of the Merger. We will promptly and timely
inform them if, after signing this representation letter, we have reason to
believe that any of the facts described herein or in the Proxy
Statement-Prospectus or any of the representations made in this representation
letter are or have become untrue, incorrect or incomplete in any respect.
Very truly yours,
[TITAN]
by ____________________________________
Name:
Title:
EXHIBIT F
Execution Copy
==============================================================================
LICENSE ACQUISITION AGREEMENT
among
TRITEL, INC.,
TELECORP WIRELESS, INC.
and
SKAGIT WIRELESS, LLC
Dated as of October 7, 2001
==============================================================================
LICENSE ACQUISITION AGREEMENT
LICENSE ACQUISITION AGREEMENT, dated as of October 7, 2001, among TRITEL,
INC., a Delaware corporation ("Tritel"), TELECORP WIRELESS, INC., a Delaware
corporation ("TeleCorp Wireless" and, together with Tritel, "Sellers"), and
SKAGIT WIRELESS, LLC, an Oregon limited liability company ("Purchaser").
WHEREAS, a subsidiary of Tritel has been granted the personal
communications services ("PCS") license described on Schedule I (the "Existing
License");
WHEREAS, Sellers have contractual rights to acquire the licenses described
on Schedule II (the "Acquisition Licenses") pursuant to various acquisition
agreements (the "Acquisition Agreements");
WHEREAS, Sellers wish to sell to Purchaser, and Purchaser wishes to
acquire from Sellers, the Existing License and the Acquisition Licenses
(sometimes collectively referred to as the "Licenses"), all on the terms and
subject to the conditions hereof;
WHEREAS, concurrently herewith TeleCorp PCS, Inc. ("TeleCorp") and AT&T
Wireless Services, Inc. ("AWS") are entering into an Agreement and Plan of
Merger (the "Merger Agreement"), pursuant to which, among other things, a wholly
owned subsidiary of AWS will be merged with and into TeleCorp (the "Merger");
and
WHEREAS, the consummation of the closing under this Agreement is subject
to the satisfaction or waiver of all conditions to the closing under the Merger
Agreement.
NOW, THEREFORE, in consideration of the promises and the representations,
warranties, covenants, conditions and agreements hereinafter set forth, the
parties agree as follows:
ARTICLE 1
PURCHASE AND SALE
Section 1.1. Initial Closing
(a) Upon the terms and subject to the conditions hereof, the closing of
the purchase and sale of the Existing License, and the Acquisition Licenses (if
any) then held by Sellers (the "Initial Closing"), shall take place
simultaneously with the Merger and shall be deemed to have closed immediately
prior to the Merger, on the date of the closing under the Merger Agreement (the
"Initial Closing Date") at the same place as such closing occurs, or at such
other time and place as the parties may agree.
(b) At the Initial Closing:
(i) Sellers shall cause their respective subsidiaries to sell,
convey, transfer, deliver and assign to Purchaser, free and clear of any
mortgage, lien, pledge, charge, security interest, right of first refusal
or right of others therein, or encumbrance of any nature whatsoever
("Liens"), other than Liens securing the indebtedness to be assumed by
Purchaser pursuant to Section 1.1(b)(ii), and Purchaser shall purchase,
acquire and accept from Sellers' subsidiaries, the Existing License and
the Acquisition Licenses, if any, then held by Sellers..
(ii) Purchaser shall pay to Sellers in immediately available funds
the sum of (i) $1,731,894 for the Existing License and (ii) the aggregate
cash purchase price paid by Sellers for the Acquisition Licenses, if any,
then held by Sellers, plus the aggregate amount of interest paid by
Sellers on indebtedness (if any) to the United States Department of the
Treasury (the "USDT") to be assumed by Purchaser pursuant to this Section
1.1(b)(ii) with respect to such Licenses, from the date that Sellers
assumed such indebtedness through the date of the Initial Closing.
Section 1.2. Subsequent Closings
(a) Following the closing under the Merger Agreement, upon the terms and
subject to the conditions hereof, each closing of the purchase and sale of
Acquisition Licenses (if any) acquired by Sellers after the Initial Closing Date
(each, a "Subsequent Closing") shall take place at the offices of Xxxxx Xxxxxx
Xxxxxxxx LLP, 0000 X.X. Xxxxx Xxxxxx, Xxxxx 0000, Xxxxxxxx, Xxxxxx 00000, at
10:00 a.m. local time on the fifth business day following the satisfaction or
waiver of all of the conditions precedent applicable to such Subsequent Closing
(each, a "Subsequent Closing Date") or at such other time and place as the
parties may agree.
(b) At each Subsequent Closing:
(i) Sellers shall cause their respective subsidiaries to sell,
convey, transfer, deliver and assign to Purchaser, free and clear of
Liens, other than Liens securing the indebtedness to be assumed by
Purchaser pursuant to Section 1.2(b)(ii), and Purchaser shall purchase,
acquire and accept from Sellers' subsidiaries, the Acquisition Licenses,
if any, then held by Sellers..
(ii) Purchaser shall pay to Sellers in immediately available funds
the sum of the aggregate cash purchase price paid by Sellers for the
Acquisition Licenses, if any, then held by Sellers, plus the aggregate
amount of interest paid by Sellers on indebtedness (if any) to the USDT to
be assumed by Purchaser pursuant to this Section 1.2(b)(ii) with respect
to such Licenses, from the date that Sellers assumed such indebtedness
through the date of such Subsequent Closing.
Section 1.3. Closing Deliveries
At the Initial Closing and each Subsequent Closing (each, a "Closing"):
(a) Sellers shall cause their respective subsidiaries to execute and
deliver to Purchaser one or more instruments of assignment, in substantially the
form attached hereto as Exhibit A.
(b) Purchaser shall pay to Sellers in immediately available funds,
pursuant to wire transfer instructions to be delivered to Purchaser at least two
business days prior to the Initial Closing Date or the Subsequent Closing Date,
as the case may be (each, a "Closing Date"), the applicable purchase price for
the Licenses being acquired.
(c) Purchaser shall execute and deliver to Sellers one or more instruments
of assumption, in form and substance satisfactory to the Federal Communications
Commission (the "FCC") and reasonably satisfactory to Sellers, in respect of the
indebtedness (if any) to be assumed by Purchaser pursuant to Section 1.2(b)(ii).
(d) The parties shall execute and deliver or cause to be executed and
delivered all other documents, instruments, and certificates, if any,
contemplated by this Agreement to be delivered at the Closing or necessary and
appropriate in order to consummate the transactions contemplated to be
consummated on the Closing Date.
Section 1.4. Certain Covenants
Each party shall use all commercially reasonable efforts to take, or cause
to be taken, all actions, and to do, or cause to be done, all things necessary,
proper or advisable and consistent with applicable law to carry out all of their
respective obligations under this Agreement and to consummate the transactions
contemplated hereby, which efforts shall include, without limitation, promptly
cooperating in the preparation and filing of one or more transfer applications
seeking FCC approval of the assignment of all of the Licenses to be assigned to
Purchaser, and in the preparation and filing of any notices, if required, under
the Xxxx-Xxxxx-Xxxxxx Antitrust Improvement Act of 1976, as amended (the "HSR
Act").
ARTICLE 2
CONDITIONS TO CLOSING
Section 2.1. Each Party's Condition to Closing
Each party's obligations to consummate the transactions contemplated by
this Agreement at any Closing are subject to the satisfaction or waiver on or
prior to the applicable Closing Date of each of the following conditions:
(a) FCC Consent
The FCC shall have issued a preliminary grant approving the assignment of
all of the Licenses to be transferred to Purchaser at such Closing, and such
preliminary grant shall be in full force and effect and free of any conditions
that would have a material adverse effect on such Licenses.
(b) HSR Clearance, Etc.
The waiting period applicable to the consummation of the transactions
contemplated hereby under the HSR Act, if any, shall have expired or been
earlier terminated, and all notices and other filings required to be made prior
to the applicable Closing Date by either party or any of its affiliates with,
and all permits, authorizations, consents and approvals required to be obtained
prior to such Closing Date by either party or any of its affiliates from, any
governmental authority in connection with the execution and delivery of this
Agreement and the consummation of the transactions contemplated hereby shall
have been made or obtained.
(c) Closing of Merger
With respect to the Initial Closing only, all conditions to closing under
the Merger Agreement shall have been satisfied or expressly waived in writing by
the parties thereto.
(d) Closing Deliveries
Sellers' obligation to consummate the transactions contemplated by this
Agreement is subject to Purchaser's making the deliveries required by Section
1.3. Purchaser's obligation to consummate the transactions contemplated by this
Agreement is subject to Sellers' making the deliveries required by Section 1.3.
Section 2.2. Sellers' Condition to Closing
Sellers' obligation at any Closing to consummate the transactions
contemplated by this Agreement is subject to the representation of Purchaser set
forth in Section 3.1 being true and correct on such Closing Date as though made
on such Closing Date.
ARTICLE 3
MISCELLANEOUS
Section 3.1. Representation by Purchaser
Purchaser represents to Sellers that Purchaser qualifies as a "very small
business" for purposes of 47 C.F.R. Sections 1.2110, 24.709 and 24.720.
Section 3.2. Entire Agreement; Amendments and Waivers
This Agreement, the Merger Agreement and all other agreements dated the
date hereof to which the parties hereto are a party constitute the entire
agreement between the parties pertaining to the subject matter hereof and
supersede all prior agreements, understandings, negotiations and discussions,
whether oral or written, of the parties. Any provision of this Agreement may be
amended or waived if, and only if, such amendment or waiver is in writing and
signed, in the case of an amendment, by both parties, or in the case of a
waiver, by the party against whom the waiver is to be effective. No failure or
delay by any party in exercising any right, power or privilege hereunder shall
operate as a waiver thereof nor shall any single or partial exercise thereof
preclude any other or further exercise thereof or the exercise of any other
right, power or privilege.
Section 3.3. Other Agreements
The parties acknowledge and agree that Sellers shall be entitled to
terminate any or all of the Acquisition Agreements, and in the event Sellers
terminate any such Acquisition Agreement, Sellers shall give prompt notice to
Purchaser of such termination.
Section 3.4. Assignment; Termination
No party to this Agreement may assign any of its rights or obligations
hereunder without the prior written consent of the other party hereto. This
Agreement shall automatically be deemed terminated without any further action by
any party in the event that the Merger Agreement terminates for any reason. Upon
such termination, all further obligations of the parties under this Agreement
shall be terminated without further liability of any party to the other parties,
except that nothing herein will relieve any party from liability for any breach
by such party of this Agreement prior to termination.
Section 3.5. GOVERNING LAW
THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF NEW YORK WITHOUT REFERENCE TO THE CHOICE OF LAW PRINCIPLES
THEREOF.
Section 3.6. Expenses
Except as otherwise expressly provided in this Agreement or any other
agreement of even date herewith entered into between the parties hereto, whether
or not the transactions contemplated by this Agreement are consummated, the
parties shall bear their own respective expenses (including, but not limited to,
all compensation and expenses of counsel, financial advisors, consultants,
actuaries and independent accountants) incurred in connection with this
Agreement and the transactions contemplated hereby.
Section 3.7. Publicity
The parties hereby agree that except as may be required to comply with the
requirements of applicable law or the rules and regulations of any national
securities exchange or automated quotation system such as NASDAQ upon which the
securities of one of the parties or its affiliates is listed, no press release
or similar public announcement or communication will be made or caused to be
made concerning the execution or performance of this Agreement unless
specifically approved in advance by all parties hereto.
Section 3.8. Counterparts
This Agreement may be executed and delivered (including by facsimile
transmission) in one or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same
instrument.
Section 3.9. Headings
The headings of the Articles and Sections herein are inserted for
convenience of reference only and are not intended to be a part of or to affect
the meaning or interpretation of this Agreement.
Section 3.10. Notices
All notices or other communications hereunder shall be in writing and
shall be deemed to have been duly given or made upon delivery if delivered
personally (by courier service or otherwise) to the applicable addresses set
forth below:
If to Tritel or TeleCorp:
Tritel, Inc.
TeleCorp Wireless, Inc.
0000 X. Xxxxx Xxxx, Xxxxx 000
Xxxxxxxxx, XX 00000
Attn: Xxxxxx X. Xxxxxxxx
Facsimile: (000) 000-0000
With a copy to:
Xxxxxx M.V. Xxxxx
Xxxxx Xxxxx
Xxx Xxxxxxxxx Xxxxxx
Xxxxxx, XX 00000
Facsimile: (000) 000-0000
If to Skagit:
Xxx X. Xxxxx
0000 000xx Xxxx XX
Xxxxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
With a copy to:
Xxxxx Xxxxxx Xxxxxxxx LLP
2300 First Interstate Tower
0000 XX Xxxxx Xxxxxx
Xxxxxxxx, Xxxxxx 00000
Attn: Xxxxxxxx X. Xxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
[Signature page follows]
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.
TRITEL, INC.
By /s/ Xxxxxx X. Xxxxxxxx
-------------------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: President, Treasurer and
Secretary
TELECORP WIRELESS, INC.
By /s/ Xxxxxx X. Xxxxxxxx
-------------------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: Chief Financial Officer and
Executive Vice President
SKAGIT WIRELESS, LLC
By /s/ Xxx Xxxxx
-------------------------------------
Name: Xxx Xxxxx
Title: Manager
Schedule I
Existing License
--------------------------------------------------------------------------
Market Call Sign Block Location
--------------------------------------------------------------------------
BTA423 WPOK659 C (30) Somerset, KY
--------------------------------------------------------------------------
Schedule II
Acquisition Licenses
--------------------------------------------------------------------------
Market Call Sign Block Location
--------------------------------------------------------------------------
BTA234 XXXX000 X Xx Xxxxxx, XX-Xxxxxx, XX
--------------------------------------------------------------------------
BTA421 XXXX000 X Xxxxx Xxxx, XX
--------------------------------------------------------------------------
BTA083 KNLG230 F Clarksville, TN-Hopkinsville, KY
--------------------------------------------------------------------------
BTA232 KNLH633 F Knoxville, TN
--------------------------------------------------------------------------
BTA017 KNLG227 F Anniston, AL
--------------------------------------------------------------------------
BTA237 XXXX000 X Xx Xxxxxx, XX
--------------------------------------------------------------------------
BTA334 KNLH624 F Opelika-Auburn, AL
--------------------------------------------------------------------------
BTA096 KNLH632 F Cookeville, TN
--------------------------------------------------------------------------
EXHIBIT A
Form of Instrument of Assignment
INSTRUMENT OF ASSIGNMENT dated as of _____________, 200_, by
___________________________, a ______________ ("Assignor"), in favor of Skagit
Wireless, LLC, an Oregon limited liability company ("Assignee"). Capitalized
terms used herein without definition shall have the respective meanings assigned
to them in the Acquisition Agreement (as defined below).
WHEREAS, Assignor and Assignee have entered into a License Acquisition
Agreement (the "Acquisition Agreement"), dated as of October ___, 2001, pursuant
to which Assignor agreed to convey to Assignee, and Assignee agreed to acquire,
the Licenses;
WHEREAS, Assignor and Assignee have filed an application with the FCC
requesting the assignment of the Licenses to Assignee; and
WHEREAS, the FCC has granted such application.
NOW, THEREFORE, in consideration of the promises and the mutual
representations, warranties, covenants, conditions, and agreements hereinafter
set forth, the parties agree as follows:
1. Assignment. Pursuant to Section 1.1(a) of the Acquisition Agreement,
for valuable consideration, receipt of which is hereby acknowledged,
Assignor, intending to be legally bound, does hereby sell, assign,
transfer, convey, and deliver toAssignee, its successors and assigns
forever, all right and interest of Assignor in and to each License,
free and clear of all Liens.
2. Terms of Acquisition Agreement Control. Nothing contained in this
Instrument of Assignment shall in any way supersede, modify,
replace, amend, change, rescind, waive, exceed, expand, enlarge, or
in any way affect the provisions of the Acquisition Agreement,
including the warranties, covenants, agreements, conditions and
representations contained in the Acquisition Agreement and, in
general, any of the rights and remedies, and any of the obligations
and indemnifications, of Assignor or Assignee set forth in the
Acquisition Agreement.
3. Power of Attorney. Assignor hereby grants its power-of-attorney to
Assignee as Assignor's attorney-in-fact to take any appropriate
action in connection with each License, in the name of Assignor or
in its own or any other name, it being understood that this
authorization and power-of-attorney are coupled with an interest and
are irrevocable.
4. Representations and Warranties. Assignor represents and warrants to
Assignee that (a) no interest in any License has been previously
assigned to any Person, (b) all rights and interests in and to each
License are assignable free and clear of Liens without any further
action or consent and (c) the rights and interests being assigned to
Assignee hereby constitute all rights and interests in and to each
License.
5. Further Assurances. Assignor covenants and agrees, in connection
with the Acquisition Agreement and this Instrument of Assignment,
promptly to execute and deliver any additional documents and
instruments and perform any additional acts that may be reasonably
necessary or desirable to effectuate and perform more fully the
provisions of this Instrument of Assignment and the assignments
provided for in Section 1 hereof.
6. Miscellaneous. This Instrument of Assignment (i) is executed
pursuant to the Acquisition Agreement and may be executed in
counterparts, each of which as so executed shall be deemed to be an
original, but all of which together shall constitute one instrument,
(ii) shall be governed by and in accordance with the internal laws
of the State of New York, without regard to the principles of
conflicts of law thereof and (iii) shall be binding upon and inure
to the benefit of the parties hereto and their respective successors
and permitted assigns.
IN WITNESS WHEREOF, Assignor and Assignee have caused this
Instrument of Assignment to be duly executed and delivered as of the date first
written above.
[ASSIGNOR]
By
---------------------------------
Name:
Title:
SKAGIT WIRELESS, LLC
By
---------------------------------
Name:
Title:
Execution Copy
ASSIGNMENT AND ASSUMPTION AGREEMENT
This Assignment and Assumption Agreement, dated October 7, 2001
("Agreement"), is entered into by and between Skagit Wireless, LLC, an Oregon
limited liability company ("Skagit"), and RW Acquisition, L.L.C., a Delaware
limited liability company ("RW").
RECITALS
--------
WHEREAS, RW now wishes to assign all of its right, title and interest in
and to, and Skagit wishes to assume all of the obligations and liabilities
under, the (i) Settlement Agreement Regarding Purchase and Distribution of the
Assets of Airadigm Communications, Inc., dated October 13, 2000 (the "Settlement
Agreement"), by and between Telephone and Data Systems, Inc. and RW Acquisition,
L.L.C., and (ii) the Collective Plan of Reorganization for Airadigm
Communications, Inc. as of Friday, October 13, 2000 As Amended on the Record at
the Confirmation Hearing, United States Bankruptcy Court for the Western
District of Wisconsin, Case No. 00-00000-00 (the "Collective Plan").
NOW, THEREFORE in consideration of the promises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
(1) Assignment. RW does hereby assign, transfer and convey to
Skagit, its successors and assigns to and for its or their use forever,
all right, title and interest of RW in and to the Settlement Agreement and
the Collective Plan, including without limitation all of the benefits of
the Settlement Agreement and the Collective Plan and the covenants,
conditions, stipulations and remedies for the enforcement thereunder.
Wherever the Settlement Agreement and the Collective Plan refer to the
designee of RW, Skagit shall hereafter be deemed to be such designee. RW
hereby agrees to indemnify, defend and hold harmless Skagit, its
affiliates, successors and assigns, from and against all claims,
liabilities and expenses (including, without limitation, reasonable
attorneys' fees) of any nature whatsoever, asserted against, suffered or
incurred by Skagit or its affiliates, successors and assigns arising out
of any of the obligations, duties or liabilities on RW's part so to be
performed under the Settlement Agreement or the Collective Plan prior to
the date hereof.
(2) Assumption. Skagit hereby agrees to be the designee of RW
pursuant to the Settlement Agreement and the Collective Plan and accepts
assignment to it by RW of all of RW's right, title and interest in and to
the Settlement Agreement and the Collective Plan, and assumes all of the
obligations and liabilities of RW in connection with the Settlement
Agreement and the Collective Plan. Skagit further agrees to indemnify,
defend and hold harmless RW, its affiliates, successors and assigns, from
and against all claims, liabilities and expenses (including, without
limitation, reasonable attorneys' fees) of any nature whatsoever, asserted
against, suffered or incurred by RW or its affiliates, successors and
assigns arising out of any of the obligations, duties or liabilities on
RW's part so to be performed under the Settlement Agreement or the
Collective Plan from and after the date hereof.
(3) Representation of Skagit. Skagit represents to RW that Skagit
qualifies as a "very small business" for purposes of 47 C.F.R. Sections
1.2110, 24.709 and 24.720.
(4) Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original and all of which
together shall constitute one and the same instrument.
(5) Miscellaneous. All of the covenants, terms and conditions set
forth herein shall be binding upon and inure to the benefit of the parties
and their respective successors and permitted assigns. This Agreement
shall be governed and in accordance with the internal laws of the State of
New York, without regard to the principles of conflicts of law thereof.
(6) Notices. All notices or other communications hereunder shall be
in writing and shall be deemed to have been duly given or made upon
delivery if delivered personally (by courier service or otherwise) to the
applicable addresses set forth below:
If to RW:
RW Acquisition, L.L.C.
0000 X. Xxxxx Xxxx, Xxxxx 000
Xxxxxxxxx, XX 00000
Attn: Xxxxxx X. Xxxxxxxx
Facsimile: (000) 000-0000
With a copy to:
Xxxxxx M.V. Xxxxx
Xxxxx Xxxxx
Xxx Xxxxxxxxx Xxxxxx
Xxxxxx, XX 00000
Facsimile: (000) 000-0000
If to Skagit:
Xxx X. Xxxxx
0000 000xx Xxxx XX
Xxxxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
With a copy to:
Xxxxx Xxxxxx Xxxxxxxx LLP
2300 First Interstate Tower
0000 XX Xxxxx Xxxxxx
Xxxxxxxx, Xxxxxx 00000
Attn: Xxxxxxxx X. Xxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.
SKAGIT WIRELESS, LLC
By
----------------------------------
Name:
Title:
RW ACQUISITION, L.L.C.
By
----------------------------------
Name:
Title:
Execution Copy
Put-Call Agreement, dated as of October 7, 2001, between Skagit Wireless,
LLC, an Oregon limited liability company ("Skagit"), and RW Acquisition, L.L.C.,
a Delaware limited liability company ("RWA") and a wholly owned subsidiary of
TeleCorp PCS, Inc. ("TeleCorp").
Whereas, RWA and Skagit have entered into an Assignment and Assumption
Agreement, dated as of the date hereof (the "Assignment"), pursuant to which RWA
has assigned to Skagit, and Skagit has assumed, all of the right, title and
interest of RWA in and to the Settlement Agreement and the Collective Plan (as
such terms are defined in the Assignment);
Whereas, TeleCorp has entered into an Agreement and Plan of Merger, dated
as of the date hereof (the "Merger Agreement"), with AT&T Wireless Services,
Inc., a Delaware corporation ("AWS"), and one of its subsidiaries;
Whereas, RWA wishes to have the right to purchase, and Skagit wishes to
have the right to cause RWA to purchase, all of the right, title and interest of
Skagit in and to (i) the Settlement Agreement and the Collective Plan (the
"Subject Rights") or (ii) any FCC licenses that Skagit may acquire pursuant to
the Settlement Agreement and the Collective Plan (the "Subject Licenses"), as
the case may be, in the event that the Merger Agreement is terminated.
Now, therefore, the parties hereby agree as follows:
1. Right to Call
-------------
RWA shall have the right, exercisable at any time prior to the 91st day
following the termination of the Merger Agreement in accordance with its terms,
to purchase from Skagit the Subject Rights or all of the Subject Licenses, as
the case may be.
2. Right to Put
------------
Skagit shall have the right, exercisable at any time within 90 days
following the termination of the Merger Agreement in accordance with its terms,
to cause RWA to purchase from Skagit the Subject Rights or all of the Subject
Licenses, as the case may be; provided, that RWA shall not be required to effect
such purchase if, prior to the expiration of such 90-day period, (i) AWS shall
have been relieved of any contractual prohibitions or limitations for the
benefit of TeleCorp and its shareholders (whether relating to exclusivity or
preferential roaming obligations or otherwise) on AWS's right to provide mobile
wireless communications services under the AWS brand in that portion of
TeleCorp's territory covered by the Subject Licenses or (ii) AWS fails to
consent to the amendment of any agreement to which it is a party that would
effect such relief, and that does not otherwise adversely affect the rights or
benefits of AWS thereunder.
3. Purchase Price
--------------
The consideration payable by RWA pursuant to Section 1 or 2, as the case
may be, will be (i) for the Subject Rights, the execution and delivery by RWA of
an assignment and assumption agreement in substantially the form of the
Assignment, and (ii) for the Subject Licenses, the purchase price therefor
actually paid by Skagit.
4. Exercise of Rights
------------------
The party exercising its rights under Section 1 or 2, as the case may be,
must send a written notice to the other party within the applicable time period,
and thereafter the parties will use commercially reasonable efforts to take, or
cause to be taken, all action and to do, or cause to be done, all things
necessary, proper or advisable under applicable laws and regulations to
consummate and make effective the transactions contemplated under Section 1 or
Section 2, as the case may be.
Without limiting the generality of the foregoing, the purchase and sale of
the Subject Rights will be effected pursuant to an assignment and assumption
agreement in substantially the form of the Assignment, and the purchase and sale
of Subject Licenses will be effected pursuant to a mutually satisfactory license
acquisition agreement that contains terms and conditions that are customary in
the industry for similar transactions.
5. Miscellaneous
-------------
This Agreement, when read together with the Assignment, embodies the
entire agreement and understanding of the parties hereto regarding the subject
matter hereof, and supersedes any prior agreements or understandings with
respect to such subject matter. This Agreement may not be amended except by a
written instrument executed by the parties. This Agreement may not be assigned
by either party without the prior written consent of the other party. This
Agreement shall be governed by the internal laws of the State of New York,
without regard to choice of law principles.
6. Notices
-------
All notices or other communications hereunder shall be in writing and
shall be deemed to have been duly given or made upon delivery if delivered
personally (by courier service or otherwise) to the applicable addresses set
forth below:
If to RWA:
RW Acquisition, L.L.C.
0000 X. Xxxxx Xxxx, Xxxxx 000
Xxxxxxxxx, XX 00000
Attn: Xxxxxx X. Xxxxxxxx
Facsimile: (000) 000-0000
With a copy to:
Xxxxxx M.V. Xxxxx
Xxxxx Xxxxx
Xxx Xxxxxxxxx Xxxxxx
Xxxxxx, XX 00000
Facsimile: (000) 000-0000
If to Skagit:
Xxx X. Xxxxx
0000 000xx Xxxx XX
Xxxxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
With a copy to:
Xxxxx Xxxxxx Xxxxxxxx LLP
2300 First Interstate Tower
0000 XX Xxxxx Xxxxxx
Xxxxxxxx, Xxxxxx 00000
Attn: Xxxxxxxx X. Xxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
[Signature page follows]
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.
RW ACQUISITION, L.L.C.
By /s/ Xxxxxx X. Xxxxxxxx
----------------------------------
Name: Xxxxxx X. Xxxxxxxx
Title:
SKAGIT WIRELESS, LLC
By /s/ Xxx Xxxxx
----------------------------------
Name: Xxx Xxxxx
Title:
EXHIBIT H
TELECORP PCS, INC.
0000 X. Xxxxx Xxxx
Xxxxxxxxx, Xxxxxxxx 00000
October 8, 2001
Xxxxxx Xxxxx and Xxxxxx X. Xxxxxxxx
Telecorp Management Corp., Inc.
0000 X. Xxxxx Xxxx -- Xxxxx 000
Xxxxxxxxx, Xxxxxxxx 00000
Dear Xxxxx and Xxx:
On behalf of Telecorp PCS, Inc. (the "Company"), I am pleased to offer
Telecorp Management Corp., Inc. ("Management") the following retention award.
Except as otherwise provided below, the Company will pay to Management a cash
payment as of the Closing Date (as defined in the Agreement and Plan of Merger
among AT&T Wireless Services, Inc. ("Wireless"), Merger Sub and the Company
dated as of the 8th of October, 2001 (the "Merger Agreement")) in an amount
equal to three times the sum of (A) Management's Management Fees (as defined in
that certain Management Agreement between Management and the Company, dated as
November 13, 2000 ("Management Agreement") and (B) Management's highest Annual
Bonus (as defined in the Management Agreement) earned for the last three full
fiscal years prior to the Closing Date (or for such lesser number of full fiscal
years prior to the Closing Date for which Management was eligible to earn such a
bonus, and annualized in the case of any bonus earned for a partial fiscal
year), if (1) Management continues to provide services to the Company through
the Closing Date in accordance with the terms of the Management Agreement, (2)
the Management Agreement is terminated by the Company for any reason other than
pursuant to Sections 5(b)(ii)(A) or 5(b)(ii)(E) of the Management Agreement
prior to the Closing Date, (3) you terminate the Management Agreement pursuant
to Section 5(b)(iii)(A), 5(b)(iii)(B) or 5(b)(iii)(C) of the Management
Agreement prior to the Closing Date or (4) either of you dies or becomes
Disabled prior to the Closing Date.
In the event that either of your employment or the Management Agreement is
terminated for any reason other than those set forth above, Management will not
be entitled to any amounts hereunder.
In consideration for the payment described above, each of you and Management
hereby agree to enter into non-competition and non-solicitation of customers and
employees agreements with Wireless and the Company at or prior to the Closing
Date.
All amounts payable hereunder will be subject to required withholding.
"Disability" means absence from employment for at least one hundred and eighty
days in any 12-month period as a result of your incapacity due to mental or
physical illness.
The provisions of this letter agreement, and any payment provided for hereunder,
shall not reduce any amounts otherwise payable, or in any way diminish your
rights under any employee benefit plan or employment agreement or other
contract, plan or arrangement nor shall any amounts payable hereunder be treated
as compensation for purposes of any benefit formula under any such plan,
agreement or contract; provided, however, you agree that neither the execution
of the Merger Agreement nor any actions taken by the Company in fulfillment of
its obligations thereunder, alone or in conjunction with any other event, shall
give rise to any termination right either of you or Management might otherwise
have to terminate the Management Agreement, and each of you and Management
hereby waive any rights that each of you and Management might otherwise have to
do so prior to or following the Closing Date. In addition, you agree to
terminate, or to cause Management to terminate, the Management Agreement to be
terminated effective on the Closing Date, no later than simultaneous with the
Closing (as defined in the Merger Agreement), with no further obligation on the
part of the Company or any of its Subsidiaries to you or to Management.
Notwithstanding the foregoing, Sections 8(b), 8(c), 8(d) and Section 13 of the
Management Agreement shall survive upon termination of the Management Agreement,
and Section 4(a) of the Management Agreement shall survive with respect to any
reimbursable expenses under Section 4(a) of the Management Agreement incurred by
Management prior to the date of termination of the Management Agreement.
This letter agreement shall be governed in accordance with the laws of the State
of New York, without regard to its principles of conflicts of laws.
This letter agreement shall not be construed as conferring upon either of you or
Management any legal rights with respect to a continuation of your employment or
other relationship with the Company or its subsidiaries.
No provision of this letter agreement may be modified, waived or discharged
unless such waiver, modification or discharge is agreed to in writing signed by
each of you and the Company. No waiver by either party hereto at any time of any
breach of the other party hereto of, or compliance with, any condition or
provision of this letter agreement to be performed by such party shall be deemed
a waiver of similar or dissimilar provisions or conditions at the same or at any
prior or subsequent time. No agreements or representations, oral or otherwise,
express or implied, with respect to the subject matter hereof have been made by
either party which are not set forth expressly in this letter agreement.
On the Closing Date, this letter agreement shall be assigned to Wireless, or its
successor, and Wireless shall have all rights and assume all obligations
hereunder. Upon the assignment and assumption, all references in this letter
agreement to the "Company" shall be deemed to refer to Wireless.
This letter agreement will be void ab initio, and shall be of no further force
and effect, upon termination of the Merger Agreement.
Please indicate your agreement to accept the terms of this letter agreement by
signing the enclosed copy of this letter and returning it to the Company.
Sincerely,
/s/ Xxxxx Xxxx
---------------------
Director
ACCEPTED:
/s/ Xxxxxx X. Xxxxx
----------------------
Xxxxxx Xxxxx, in my individual capacity
and my capacity as owner and officer of
Telecorp Management Corp., Inc.
ACCEPTED:
/s/ Xxxxxx X. Xxxxxxxx
----------------------
Xxxxxx X. Xxxxxxxx, in my individual capacity
and my capacity as owner and officer of
Telecorp Management Corp., Inc.
