EXHIBIT 2.13
STOCK PURCHASE AGREEMENT
by and among
TELETOUCH COMMUNICATIONS, INC.
as Buyer
and
the Shareholders of
▇▇▇▇▇▇▇'▇ COMMUNICATION, INC.
(D/B/A LOUISIANA PAGING & COMMUNICATIONS CO.)
as Sellers
May 13, 1996
TABLE OF CONTENTS
ARTICLE I DEFINITIONS
1.1 Definitions................................................. 1
1.2 Other Terms................................................. 6
1.3 Other Definitional Provisions............................... 6
ARTICLE II THE TRANSACTION
ARTICLE III PAYMENT OF PURCHASE PRICE
3.1 Amount; Delivery............................................ 7
3.2 Purchase Price Adjustments.................................. 7
3.3 Holdback.................................................... 8
3.4 Excluded Asset.............................................. 8
ARTICLE IV REPRESENTATIONS AND
WARRANTIES OF SELLERS
4.1 Existence and Good Standing................................. 9
4.2 Capitalization of The Company............................... 9
4.3 Authorization and Validity of Agreement..................... 9
4.4 Consents and Approvals; No Violations.......................10
4.5 Receivables and Payables....................................10
4.6 Financial Statements; No Material Adverse Change............10
4.7 Warranty Claims.............................................11
4.8 Title to Properties; Encumbrances; Condition................11
4.9 Leases......................................................11
4.10 Contracts and Commitments..................................11
4.11 Permits....................................................13
4.12 Litigation.................................................13
4.13 Taxes......................................................14
4.14 Insurance..................................................15
4.15 Intellectual Property......................................15
4.16 Compliance with Laws.......................................15
4.17 Employment Relations.......................................15
4.18 Employee Benefit Plans.....................................15
4.19 Environmental Laws and Regulations.........................15
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4.20 Interests in Customers and Suppliers........................16
4.21 Compensation of Employees...................................16
4.22 Suppliers and Customers.....................................16
4.23 Absence of Changes..........................................17
4.24 Solvency and Indebtedness...................................18
4.25 Disclosure..................................................18
4.26 Government Contracts........................................18
4.27 Copies of Documents.........................................18
4.28 No Subsidiaries.............................................18
4.29 Books and Records...........................................18
4.30 Broker's or Finder's Fees...................................18
ARTICLE V REPRESENTATIONS AND
WARRANTIES OF BUYER
5.1 Existence and Good Standing of Buyer; Power and Authority....19
5.2 No Violations................................................19
5.3 Broker's or Finder's Fees....................................20
ARTICLE VI CONDITIONS TO
SELLER'S OBLIGATIONS
6.1 Truth of Representations and Warranties......................20
6.2 Performance of Agreements....................................20
6.3 No Litigation Threatened.....................................20
6.4 Governmental Approvals.......................................20
6.5 Proceedings..................................................21
ARTICLE VII CONDITIONS TO BUYER'S
OBLIGATIONS
7.1 Truth of Representations and Warranties......................21
7.2 Performance of Agreements....................................21
7.3 No Litigation Threatened.....................................21
7.4 Due Diligence................................................21
7.5 Governmental Approvals.......................................21
7.6 Consents.....................................................22
7.7 Legal Opinions...............................................22
7.8 Schedules....................................................22
7.9 Proceedings..................................................22
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ARTICLE VIII COVENANTS OF SELLER
8.1 Cooperation by Sellers......................................22
8.2 Notice of Breaches..........................................22
8.3 Conduct of Business.........................................23
8.4 Negative Covenants of Seller................................23
8.5 Exclusive Dealing...........................................24
8.6 Review of the Assets........................................24
8.7 Governmental Filings........................................24
8.8 Further Assurances..........................................25
ARTICLE IX COVENANTS OF BUYER
9.1 Cooperation by Buyer........................................25
9.2 Books and Records; Personnel................................25
9.3 Further Assurances..........................................25
9.4 Governmental Filings........................................25
ARTICLE X THE CLOSING
10.1 Time and Place.............................................26
10.2 Sellers' Obligations.......................................26
10.3 Buyer's Obligations........................................27
ARTICLE XI TERMINATION
11.1 Termination................................................27
11.2 Remedies Upon Default or Failure to Close..................28
11.3 Effect on Obligations......................................28
ARTICLE XII SURVIVAL AND INDEMNIFICATION
12.1 Indemnification of Seller..................................29
12.2 Indemnification of Buyer...................................29
12.3 Demands....................................................29
12.4 Right to Contest and Defend................................30
12.5 Cooperation................................................30
12.6 Right to Participate.......................................31
12.7 Payment of Damages.........................................31
12.8 Survival of Representations and Warranties.................31
ARTICLE XIII MISCELLANEOUS
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13.1 Notices.....................................................31
13.2 Governing Law...............................................33
13.3 Entire Agreement; Amendments and Waivers....................33
13.4 Binding Effect and Assignment...............................34
13.5 Severability................................................34
13.6 Headings....................................................34
13.7 Execution...................................................34
13.8 Sales and Transfer Taxes....................................34
13.9 Expenses....................................................34
13.10 Publicity..................................................34
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SCHEDULES
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Schedule 3.2(e) Certain Equipment
Schedule 4.2 Shareholder Impediments
Schedule 4.4 Seller Consents
Schedule 4.5 Receivables and Payables
Schedule 4.6 Material Adverse Change
Schedule 4.7 Warranty Claims
Schedule 4.8 Title to Properties; Encumbrances; Condition
Schedule 4.9 Leases
Schedule 4.10 Contracts and Commitments
Schedule 4.11 Permits
Schedule 4.12 Litigation
Schedule 4.13 Taxes
Schedule 4.14 Insurance Policies
Schedule 4.15 Intellectual Property
Schedule 4.19 Environmental Laws and Regulations
Schedule 4.20 Certain Relationships of Seller
Schedule 4.21 List of Employees of Seller
Schedule 4.22 Suppliers and Customers
Schedule 4.23 Absence of Changes
Schedule 4.24 Indebtedness
Schedule 4.28 Government Contracts
EXHIBITS
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Exhibit A Noncompetition Agreements
Exhibit B-1 Opinion of Seller's Counsel
Exhibit B-2 Opinion of Seller's FCC Counsel
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STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (the "Agreement") dated as of May 13, 1996,
is by and among Teletouch Communications, Inc., a Delaware corporation
("Buyer"), and ▇▇▇ ▇. ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ (individually, a "Seller"
and collectively, the "Sellers"), together constituting all of the shareholders
of ▇▇▇▇▇▇▇'▇ Communication, Inc., d/b/a Louisiana Paging & Communications Co., a
Louisiana corporation (the "Company").
W I T N E S S E T H:
WHEREAS, the Sellers wish to sell and Buyer wishes to purchase all of the
issued and outstanding capital stock of the Company (the "Stock") and the
Equipment, as defined below, all upon the terms and subject to the conditions
set forth below.
NOW, THEREFORE, for the mutual covenants and other consideration described
herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto covenant and
agree as follows:
ARTICLE I
DEFINITIONS
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I.1 Definitions. As used herein, the following terms have the meanings
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set forth below:
"Accounts Receivable": all notes and accounts receivable of Seller
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attributable to the Business through the date immediately preceding the Closing
Date.
"Affiliate": with respect to any Person, any other Person directly or
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indirectly controlling (including but not limited to all directors and officers
of such Person), controlled by, or under direct or indirect common control with
such Person.
"Agreement": this Stock Purchase Agreement, as amended from time to time
---------
as provided herein, and all exhibits, schedules and ancillary documents hereto,
except where the context clearly indicates otherwise.
"Audit Date": as defined in Section 3.2(a).
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"Balance Sheet": as defined in Section 4.6.
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"Books and Records": all books, records, books of account, files and data
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(including customer and supplier lists), catalogs, brochures, sales literature,
promotional material, certificates and other documents used in or associated
with the conduct of the Business or the ownership of the assets, including
personnel records and files (to the extent Seller's personnel are hired by
Buyer), minute books, transfer ledgers and stock certificates.
"Business": the paging operations, including (a) the lease and sale of
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paging equipment, (b) sale and servicing of mobile equipment, (c) voice mail
services and (d) any other services provided by the Company relating to the
paging industry as currently conducted by the Company which has its principal
office at ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇.
"Business Day": any day excluding Saturday, Sunday and any day on which
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banks in Houston, Texas are authorized or required by law or other governmental
action to close.
"Buyer": as defined in the preamble of this Agreement.
-----
"Buyer Indemnitees": as defined in Section 13.2.
-----------------
"Buyer's Agreements": the Escrow Agreement and the Noncompetition
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Agreements.
"Cash Payment": as defined in Section 3.1(a).
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"Claim": as defined in Section 13.3.
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"Closing": as defined in Section 10.1.
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"Closing Date": as defined in Section 10.1.
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"Code": the Internal Revenue Code of 1986, as amended from time to time,
----
and the regulations promulgated and rulings issued thereunder. Section
references to the Code are to the Code as in effect at the date of this
Agreement and any subsequent provisions of the Code amendatory thereof,
supplemental thereto or substituted therefor.
"Commission": the Federal Communications Commission.
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"Company": as defined in the preamble hereto.
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"Confidentiality Agreement": as defined in Section 12.3.
-------------------------
"Contract": any written or oral contract, agreement or instrument relating
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to the Business
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to which the Company is a party or is otherwise bound, including, without
limitation, supply contracts, customer agreements, any mortgages, deeds of
trust, notes or guarantees, pledges, liens, or conditional sales agreements to
which the Company is a party or by which any of its assets may be bound, but
excluding Leases and Employee Benefit Plans.
"Damages": as defined in Section 13.1.
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"December Balance Sheet": as defined in Section 3.2(a).
----------------------
"Deposit": as defined in Section 2.2.
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"Employee Benefit Plans": any employee benefit plans, policies, programs
----------------------
and arrangements and all related contracts, agreements and other descriptions
thereof with respect to the employee benefits provided to the employees of the
Company conducting the Business as of the date hereof and through the Closing
Date.
"Encumbrances": liens, security interests, options, rights of first
------------
refusal, easements, mortgages, charges, debentures, indentures, deeds of trust,
rights-of-way, restrictions, encroachments, licenses, Leases, Permits, security
agreements, or any other encumbrances and other restrictions or limitations on
the use or ownership of real or personal property or irregularities in title
thereto.
"Environmental Claim": any and all administrative, regulatory, judicial or
-------------------
other actions, suits, demands, demand letters, claims, liens, notices of
noncompliance or violations, investigations or proceedings relating in any way
to any Environmental Law or any permit issued under any such Environmental Law
(cumulatively and for purposes of this definition, "Environmental Claims"),
including without limitation (i) any and all Environmental Claims by
governmental authorities for enforcement, penalties, cleanup, removal, remedial
or other actions or damages pursuant to any applicable Environmental Law, and
(ii) any and all Environmental Claims by any third party seeking damages,
enforcement, penalties, contribution, indemnification, cost recovery,
compensation or injunctive relief resulting from Hazardous Materials or arising
from alleged injury or threat of injury to health, safety or the environment.
"Environmental Law": any federal, state or local statute, law, rule,
-----------------
regulation, ordinance, code, policy or rule of common law now in effect and in
each case as amended and any judicial or administrative interpretation thereof,
including any judicial or administrative order, consent decree or judgment,
relating to Hazardous Materials, the environment or health relating to or
arising from environmental conditions, including without limitation the
Occupational Safety and Health Act, as amended, 29 U.S.C. (S) 651 et seq; the
-- ---
Comprehensive Environmental Response, Compensation, and Liability Act of 1980,
as amended 42 U.S.C. (S) 9601 et seq.; the Hazardous Materials Transportation
-- ---
Act, as amended, 49 U.S.C. (S) 5101 et seq.; the Resource Conservation
-- ---
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and Recovery Act, as amended, 42 U.S.C. (S) 6901 et seq.; the Federal Water
-- ---
Pollution Control Act, as amended, 33 U.S.C. (S) 1251 et seq.; the Toxic
-- ---
Substances Control Act, 15 U.S.C. (S) 2601 et seq.; the Clean Air Act, 42 U.S.C.
-- ---
(S) 7401 et seq.; the Safe Drinking Water Act, 42 U.S.C. (S) 300f et seq.; the
-- --- -- ---
Oil Pollution Act of 1990, 33 U.S.C. (S) 2701 et seq.; and relevant state and
-- ---
local laws.
"Equipment": as defined in Section 3.2(d).
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"ERISA": the Employee Retirement Income Security Act of 1974, as amended
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from time to time, and the regulations promulgated and rulings issued
thereunder. Section references to ERISA are to ERISA as in effect at the date
of this Agreement and any subsequent provisions of ERISA amendatory thereof,
supplemental thereto or substituted therefor.
"Escrow Agreement": the agreement in form and substance materially
----------------
satisfactory to Buyer and Sellers and to be entered into among Buyer, Sellers
and a bank materially acceptable to the parties, as escrow agent, pursuant to
which Buyer shall make the deposit of the Holdback in escrow subject to the
disbursement terms of this Agreement.
"Excluded Asset": as defined in Section 3.5.
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"FCC Approvals": as defined in Section 6.4.
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"Financial Statements": as defined in Section 4.6.
--------------------
"Finova": Finova Capital Corporation, the senior lender to Buyer.
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"GAAP": generally accepted accounting principles consistently applied (as
----
such term is used in the American Institute of Certified Public Accountants
Professional Standards) as of the date of the Financial Statements.
"Hazardous Materials": (i) any petroleum or petroleum products,
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radioactive materials, asbestos in any form that is or could become friable,
urea formaldehyde foam insulation, transformers or other equipment that contain
dielectric fluid containing levels of polychlorinated biphenyls, and radon gas;
and (ii) any chemicals, materials or substances defined as or included in the
definition of "hazardous substances," "hazardous wastes," "hazardous materials,"
"extremely hazardous wastes," "restricted hazardous wastes," "toxic substances,"
"toxic pollutants," "contaminants," "pollutants," "regulated substances" or
words of similar import under any applicable Environmental Law.
"Holdback": as defined in Section 3.3.
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"Intellectual Property": domestic and foreign patents, patent
---------------------
applications, registered and unregistered trademarks, service marks, trade names
and logos, registered and unregistered copyrights, computer programs and
software, data bases, trade secrets, methods, designs, processes, procedures,
proprietary information and any other intangible property used in or associated
with the conduct of the Business and the ownership of the assets, including all
of the Company's rights to any such property which is owned by and licensed from
others and any goodwill associated with any of the above.
"Inventory": all pagers, other merchandise, supplies, stock in trade and
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other such assets of the Company held for sale or lease in the ordinary course
of the Business or to be furnished under contracts of service or held as work in
process or to be used or consumed in the Business.
"Leases": any and all written and oral contracts, agreements, and
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commitments regarding the lease of real or personal property to which the
Company is a party or is otherwise bound that relate to or are used in the
operation of the Business, including, but not limited to, leases of towers and
transmitter sites.
"Loan Agreement": as defined in Section 5.2.
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"Noncompete Payment": as defined in Section 3.1(b).
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"Noncompetition Agreement": the agreement between Buyer and each of the
------------------------
Sellers relating to each Sellers' noncompetition with Buyer and the Company in
the form of Exhibit "A" attached hereto, to be executed at Closing.
"Permits": any license, permit, franchise, consent, approval or authority
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granted to the Company by any Person, including, but not limited to, all
licenses and permits issued by the Commission.
"Permitted Encumbrances": (i) Encumbrances consisting of easements,
----------------------
permits and other restrictions or limitations on the use of real property or
irregularities in title thereto that do not materially detract from the value
of, or materially impair the use of, such property by Seller in the operation of
the Business, (ii) Encumbrances for current taxes, assessments or governmental
charges or levies on property not yet due and delinquent and (iii) Encumbrances
created by Buyer.
"Person": any individual, partnership, joint venture, corporation, trust,
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unincorporated organization, government or other department or agency thereof or
other entity.
"Pre-Closing Period": as defined in Section 4.13(a).
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"Purchase Price": as defined in Section 3.1.
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"Releases": as defined in Section 4.19.
--------
"Returns": as defined in Section 4.13(a).
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"Rules and Regulations": as defined in Section 4.11.
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"Schedules": The schedules of Seller, Buyer or both as appropriate in the
---------
context and as referenced throughout this Agreement.
"Seller(s)": as defined in the preamble of this Agreement.
---------
"Sellers Indemnitees": as defined in Section 13.1.
-------------------
"Sellers' Agreements": the Escrow Agreement and the Noncompetition
-------------------
Agreement.
"Stock": as defined in the introduction to this Agreement.
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"Subordinated Debt Agreement": as defined in Section 5.2.
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"Tax": any net income, alternative or add-on minimum tax, advance,
---
corporation, gross income, gross receipts, sales, use, ad valorem, franchise,
-- -------
profits, license, value added, withholding, payroll, employment, excise, stamp
or occupation tax, governmental fee or other like assessment or charge of any
kind whatsoever, together with any interest or any penalty imposed by any
governmental authority with respect thereto, and any liability for such amounts
as a result either of being a member of an affiliated group or of a contractual
obligation to indemnify any other entity.
I.2 Other Terms. Other terms may be defined elsewhere in the text of
-----------
this Agreement and shall have the meaning indicated throughout this Agreement.
I.3 Other Definitional Provisions.
-----------------------------
(a) The words "hereof," "herein" and "hereunder," and words of
similar import, when used in this Agreement, shall refer to this Agreement
as a whole and not any particular provision of this Agreement.
(b) The terms defined in the singular shall have a comparable
meaning when used in the plural, and vice versa.
(c) The terms defined in the neuter or masculine gender shall
include the
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feminine, neuter and masculine genders, unless the context clearly
indicates otherwise.
(d) Reference to the "best knowledge" of a Person or words of
similar import shall mean the actual or constructive best knowledge of such
Person after reasonable due diligence as to the facts and circumstances
addressed.
ARTICLE II
THE TRANSACTION
---------------
Subject to the terms and conditions of this Agreement, Buyer agrees to
purchase from Sellers, and Sellers agree to sell, convey, transfer, assign and
deliver, and cause to be sold, conveyed, transferred, assigned and delivered,
the Stock to Buyer on the Closing Date against the receipt by Sellers of the
Purchase Price.
ARTICLE III
PAYMENT OF PURCHASE PRICE
-------------------------
III.1 Amount; Delivery. The purchase price ("Purchase Price") for the
----------------
Stock, the Equipment, the Noncompetition Agreement and all other rights and
obligations contemplated hereunder shall be Two Million Three Hundred Thousand
Dollars ($2,300,000), as adjusted pursuant to Section 3.2 hereof. At the
Closing, the Purchase Price, as adjusted, shall be remitted by Buyer to Seller
in the following manner:
(a) $2,200,000 in cash (the "Cash Payment") as adjusted pursuant
to Section 3.2 below, less the amount of the Holdback as defined and as
provided for in Section 3.3 below, shall be paid to the Sellers in
proportion to their respective ownership of the Stock by wire transfer of
immediately available funds to the respective accounts of the Sellers as
designated in writing by Sellers to Buyer not more than three (3) Business
Days prior to the Closing Date; and
(b) $100,000 in cash ("Noncompete Payment") on the Closing Date,
which shall be paid to the Sellers in proportion to their respective
ownership of Stock by wire transfer of immediately available funds to
respective accounts of the Sellers as designated pursuant to Section 3.1(a)
above.
III.2 Purchase Price Adjustments. At the Closing, the Purchase Price
--------------------------
shall be reduced or increased, as applicable, for the aggregate dollar amount of
the following determined as of the Closing Date:
(a) The Purchase Price shall be reduced by the amount of
outstanding
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indebtedness of the Company for borrowed funds which are not to exceed $130,000.
At the Closing, Buyer will pay the withheld amount to the appropriate creditors,
lenders, mortgagees or such other persons as may be due monies to pay such
indebtedness.
(b) (i) The Purchase Price shall be reduced by the amount of
any dividends or distributions to the Sellers made after December 31, 1995
("Audit Date"), (ii) the amount of any bonuses or increases in salaries paid
after the Audit Date to any officer, director or employee of the Company or any
person related to any such officer, director or employees; and (iii) any
dividends, distributions, salaries or bonuses made or paid during the period
December 31, 1995 through the Closing Date out of the ordinary course of
business or inconsistent with past practices of the Company.
(c) The Purchase Price shall be increased by $3,800.00, the fair
market value of the equipment identified on Schedule 3.2(a) which was previously
leased to the Company by ▇▇▇ ▇. ▇▇▇▇▇▇ (the "Equipment") and will be
transferred to the Company on or before the Closing Date.
(d) The Purchase Price shall be increased by the amount of cash
paid by the Company for the purchase of pagers or equipment after June 1, 1996,
in the ordinary course of business.
III.3 Holdback. The Purchase Price to be paid at Closing shall be
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reduced by ten percent (10%) of the total Purchase Price after making the
adjustments specified in Sections 3.2(b), (c) and (d) above, and the amount of
such reduction (the "Holdback") shall be deposited into escrow by Buyer pursuant
to the terms of the Escrow Agreement for a period of one year from the Closing
Date to be applied to post-Closing Purchase Price adjustments (as set forth in
Section 3.4 below) and as an offset against any indemnification amounts due
Buyer by Sellers after the Closing pursuant to Article XII hereof. On the first
anniversary date of the Closing Date, the escrow agent under the Escrow
Agreement, pursuant to written instructions in accordance with the terms of the
Escrow Agreement, shall wire transfer the amount of the Holdback and any and all
accrued interest, less any amounts previously transferred to Buyer or then
subject to a claim by Buyer made prior to such date under Article XII, in
immediately available funds to the respective accounts designated by Sellers in
the same proportions as set forth in Section 3.1.
III.4 Excluded Asset. At Closing, the Company shall transfer title to
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and possession of and control of that certain automobile identified as 1996
Lincoln Continental (the "Excluded Asset") to ▇▇▇ ▇. ▇▇▇▇▇▇.
ARTICLE IV
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REPRESENTATIONS AND WARRANTIES OF SELLERS
-----------------------------------------
Sellers hereby represent and warrant, jointly and severally, to Buyer as
follows:
IV.1 Existence and Good Standing. The Company is a corporation duly
---------------------------
organized and validly existing under the laws of the State of Louisiana. The
Company has the power and authority to own, lease and operate its property and
to carry on its business as now being conducted and to own or lease the assets
owned or leased by it. The Company is duly qualified or licensed to do business
in each jurisdiction in which the character or location of the properties owned
or leased by the Company or the nature of the business conducted by the Company
makes such qualification necessary.
IV.2 Capitalization of The Company.
-----------------------------
(a) The entire authorized capital stock of the Company consists
of 1,000 shares of common stock, no par value per share, of which 1,000
shares are issued and outstanding, fully paid and nonassessable. The Stock
is owned beneficially and of record by the Sellers as set forth on Schedule
4.2.
(b) The Stock represents all of the issued and outstanding
capital stock of the Company. There are no outstanding subscriptions,
options, convertible securities or debt instruments, warrants, calls or
rights of any kind including preemptive rights (issued, contracted for or
granted by, or binding upon, the Company) to purchase or otherwise acquire
any security of or equity interest in the Company. Except as set forth in
Schedule 4.2, the Sellers have full legal right to sell, assign and
transfer the Stock to Buyer and will, upon delivery of the Stock to Buyer
pursuant to the terms hereof, transfer to Buyer good and valid title to the
Stock free and clear of all Encumbrances, rights, options to purchase,
voting trusts or other voting agreements and calls and commitments of every
kind affecting the Stock.
(c) There are no outstanding registration rights relating to the
Stock. The Stock was issued in compliance with exemptions from the
registration requirements of federal and state securities laws, as
applicable.
IV.3 Authorization and Validity of Agreement. Each of the Sellers has
---------------------------------------
full legal capacity to execute and deliver this Agreement and the Sellers
Agreements, to perform its obligations hereunder and thereunder and to
consummate the transactions contemplated hereby and thereby. This Agreement,
and the Sellers' Agreements have been, as applicable as of the date hereof or
as of the Closing Date, duly executed and delivered by Sellers, as applicable,
and are valid and binding obligations of Sellers enforceable against Sellers in
accordance with their respective terms, except to the extent that enforceability
may be subject to applicable bankruptcy,
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insolvency, reorganization, moratorium and similar laws affecting the
enforcement of creditors' rights generally and by general equitable principles.
IV.4 Consents and Approvals; No Violations. The execution, delivery and
-------------------------------------
performance of this Agreement and the Sellers' Agreements by Sellers and the
consummation by Sellers of the transactions contemplated hereby and thereby will
not, with or without the giving of notice or the lapse of time or both: (a)
violate, conflict with, or result in a breach or default under any provision of
the charter or bylaws of the Company; (b) violate any statute, ordinance, rule,
regulation, order, judgment or decree of any court or of any governmental or
regulatory body, agency or authority applicable to the Company or Sellers or by
which any of their respective properties or assets may be bound; (c) require any
filing by the Company or Sellers with, or require the Company or Sellers to
obtain any Permit of, or require the Company or Sellers to give any notice to,
any governmental or regulatory body, agency or authority other than as set forth
on Schedule 4.4 attached hereto; or (d) other than as set forth on Schedule 4.4
attached hereto, result in a violation or breach by the Company or Sellers of,
conflict with, constitute (with or without due notice or lapse of time or both)
a default by the Company or Sellers (or give rise to any right of termination,
cancellation, payment or acceleration) under or result in the creation of any
Encumbrance upon any of the assets or properties of the Company under any of the
terms, conditions, or provisions of any note, bond, mortgage, indenture, Permit,
Contract, Lease or other instrument or obligation to which the Company or any
Seller is a party, or by which the Company, any Seller or any of the assets or
properties of the Company may be bound, except in the case of clauses (b), (c)
and (d) of this Section 4.4, for such violations, consents, breaches, defaults,
terminations and accelerations which in the aggregate would not have a material
adverse effect on the business, condition (financial or otherwise) or assets of
the Company.
IV.5 Receivables and Payables. Schedule 4.5 lists all Accounts
------------------------
Receivable of the Company. Schedule 4.5 specifically indicates all such
Accounts Receivable from any Affiliate of the Company. Except as reflected on
Schedule 4.5, all such Accounts Receivable are, and all Accounts Receivable at
the Closing Date will be, (a) bona fide claims against debtors for sales, work
performed or other charges, (b) to the best knowledge of Sellers, subject to no
defenses, set-offs or counterclaims and (c) collectible subject to the Company's
normal reserve for bad debts as reflected in the Financial Statements. Except
as set forth on Schedule 4.5 or for trade accounts payable or to become due and
payable within 30 days, all accounts payable of the Company have been paid.
IV.6 Financial Statements; No Material Adverse Change. Sellers have
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heretofore furnished Buyer with the audited financial statements of the Company
as of December 31, 1995, in the form of a balance sheet (the "Balance Sheet"),
and an income statement for the twelve-month period then ended relating to the
Balance Sheet (together with the Balance Sheet, the "Financial Statements").
The Financial Statements have been prepared in accordance with
-10-
GAAP and fairly present in all material respects the financial position of the
Company at the dates thereof and the results of operations and cash flow of the
Company for the period indicated. Except as set forth on Schedule 4.6 attached
hereto, since the Audit Date there has been no change in the assets or
liabilities, or in the business or condition, financial or otherwise, or in the
results of operations of the Company.
IV.7 Warranty Claims. Except as set forth on Schedule 4.7 attached
---------------
hereto, as of the date hereof, there are no warranty claims relating to products
at any time sold or services at any time performed by the Company pending or, to
the best knowledge of the Company, threatened.
IV.8 Title to Properties; Encumbrances; Condition. Except as set forth
--------------------------------------------
on Schedule 4.8 or any of the other Schedules hereto and except for properties
and assets reflected in the Financial Statements or acquired since the Audit
Date which have been sold or otherwise disposed of in the ordinary course of
business, the Company owns outright, and has, and shall at the Closing have,
full legal and beneficial title to all of its assets and properties, in each
case subject to no Encumbrances except for Permitted Encumbrances. Except as set
forth on Schedule 4.8, each asset is in good operating condition and repair,
subject to ordinary wear and tear, and has been maintained in accordance with
the manufacturers' specifications, and each asset is in compliance with all
applicable federal and state laws and regulations. The Inventory consists of
items of a quality and quantity usable or saleable in the regular course of
business of the Company. As of the date of this Agreement, the Company has no
less than 424 pagers in Inventory, no less than 1,812 leased pagers outstanding
and at least 5,637 pagers in service.
IV.9 Leases. Schedule 4.9 contains an accurate and complete list of all
------
Leases to which the Company is a party (as lessee or lessor). Each Lease set
forth on Schedule 4.9 is, to the best knowledge of the Company, in full force
and effect; there is no existing default under any of such Leases on the part of
the Company or, to the best of the Company's knowledge, any other party thereto.
IV.10 Contracts and Commitments. Schedule 4.10 contains an accurate and
-------------------------
complete list of all Contracts to which the Company is a party. Each Contract
set forth on Schedule 4.10 is, to the best knowledge of the Company, in full
force and effect; there is no existing default under any of such Contracts on
the part of the Company or, to the best of Sellers' knowledge, any other party
thereto. Except as set forth on Schedule 4.10:
(a) The Company is not a party to or bound by any loan, credit
or similar agreement or any indenture, trust agreement or other instrument
relating to any issue of bonds, debentures, notes or other evidences of
indebtedness or creating any Encumbrance on any of the Company's assets or
properties;
(b) There are no bonus, pension, profit sharing, retirement,
stock
-11-
option, stock purchase, deferred compensation, hospitalization or insurance
plans, or vacation or severance pay plans, or any other plans or
arrangements providing benefits to officers, agents or employees of the
Company;
(c) The Company does not have nor is the Company currently
negotiating any collective bargaining agreement with any labor union or
association or any employment contract or other binding agreement relating
to the employment of any of its employees;
(d) The Company is not a party to any joint venture agreement or
other agreement involving the sharing of profits relating to the Business
and/or the Company' assets or properties;
(e) The Company is not a party to any (i) contracts or
commitments for capital expenditures outside the ordinary course of
business or involving obligations on the part of the Company in amounts
inconsistent with those incurred by the Company in the ordinary course of
business in accordance with the Company's prior operation of the Business,
(ii) Lease under which personal property is leased to or from the Company
and which is not cancelable by the Company without penalty upon notice of
thirty days or less or pursuant to which rentals payable by or to the
Company, either individually or in the aggregate, substantially exceed
amounts previously incurred by the Company in the ordinary course of
business, (iii) continuing contract for the future purchase of Inventory or
other materials, supplies, machinery or equipment in excess of the
requirements of the Business conducted in the ordinary course, (iv) other
contract or agreement which involves an obligation on the part of the
Company, either individually or in the aggregate, in excess of amounts
previously incurred by the Company in the ordinary course of business, (v)
contract not made in the ordinary course of business, or (vi) any contract
that is terminable upon or requires a consent to a change of control of the
Company;
(f) There are no agreements, notes, mortgages, leases,
franchises, permits, orders, judgments or decrees to which the Company is a
party or by which the Company is bound, which contain any provision which
would be violated or contravened by, or which would cause acceleration of
any obligation of the Company as a result of or which would cause or permit
the forfeiture of any right or benefit of the Company by reason of the
execution or performance of this Agreement;
(g) The Company is not party to any Contract limiting the
freedom of a the Company to engage in any line of business or to compete
with any Person;
(h) The Company is not a party to any Contract which involves
$5,000 or more and is not cancelable without penalty within thirty days;
and
-12-
(i) There are no persons holding powers of attorney from, or
otherwise authorized to act on behalf of the Company with respect to the
Business or the assets except for its respective officers and other
management personnel regularly performing their business functions.
Except as specifically identified on Schedule 4.10, Sellers have no knowledge
that any Contract, Lease, or other obligation to which the Company is a party,
individually or in the aggregate: (i) will result in a material loss to the
Company after the Closing Date; (ii) cannot readily be performed or fulfilled on
time without undue or unusual expenditure of money or effort by the Company
after the Closing Date, or (iii) is not in full force and effect and there
exists a default or event of default or event, occurrence, condition or act
which, with the giving of notice, the lapse of time or the happening of any
other event or condition, would become a default or event of default thereunder.
A true copy of each written Contract and Lease as well as all other documents
evidencing any commitment of the Company required to be set forth on any
Schedule hereto has been or will be delivered to Buyer by Sellers no later than
fifteen (15) days after execution of this Agreement. Also set forth on Schedule
4.10 is a list of all proposals, except proposals made by the Company's sales
people in the ordinary course of business, submitted by the Company to any third
party that, if accepted by such third party, would require disclosure on
Schedule 4.10.
IV.11 Permits. All Permits required in connection with the use,
-------
operation or ownership of the assets or properties of the Company and the
conduct of the Business as currently conducted are listed on Schedule 4.11. To
the best knowledge of Sellers, the Permits issued to the Company by the
Commission can be transferred to Buyer or a subsidiary corporation of Buyer as
part of the consummation of the transactions contemplated by this Agreement.
All such Permits are in full force and effect and the facilities associated with
such Permits have been constructed within the time frame provided by the rules
and regulations promulgated by the Commission pursuant to the Communications Act
of 1934 (the "Rules and Regulations").
IV.12 Litigation. Except as set forth on Schedule 4.12, there is no
----------
action, suit, proceeding at law or in equity, arbitration or administrative or
other proceeding by or before (or any investigation by) any governmental or
other instrumentality or agency, pending, or, to the best knowledge of the
Company, threatened, against or affecting the assets, properties or rights of
the Company, and Sellers do not know of any valid basis for any such action,
proceeding or investigation. There are no such suits, actions, claims,
proceedings or investigations pending or to the best knowledge of Sellers,
threatened, seeking to prevent or challenge the transactions contemplated by
this Agreement. Schedule 4.12 lists all claims, if any, filed with the
Commission with respect to the Company and/or the operation of the Business
since January 1, 1993. A decision adverse to the Company with respect to any of
the matters listed on Schedule 4.12, or with respect to all or any combination
thereof, would not result in a material adverse effect to the business,
conditions (financial or otherwise) or assets of the Company.
-13-
IV.13 Taxes.
-----
(a) The Company has either accrued, discharged or caused to be
discharged, as the same have become due, or the Balance Sheet contains
adequate accruals and reserves for, all Taxes attributable or relating to
the properties of the Company, its Business or operations or the revenues
or income derived therefrom for all periods through the Audit Date. As of
the Closing Date, the Company will have, in all material respects,
satisfied or accrued, for all periods through the Closing Date, all
applicable federal, state, local and foreign withholding tax requirements
including without limitation, income, social security and employment tax
withholding for all types of compensation. All quarterly deposits of
estimated Taxes required to be paid by the Company since the Audit Date
through the date hereof have been paid, and all quarterly deposits of
estimated Taxes required to be paid by the Company after the date hereof
through the Closing Date (the "Pre-Closing Period") will have been paid on
or before the Closing Date. All other Taxes of the Company for any period
after the Audit Date through the date hereof have been paid or properly
accrued on the books of the Company. The Company has filed, or by the
Closing Date will have filed, in a timely manner (taking into account all
extensions of due dates) with the appropriate federal, state, local and
foreign governmental authorities all Tax returns, if any, that are required
to be filed by or on behalf of the Company on or before the Closing Date,
such Tax returns are complete and correct in all material respects, and the
Company has paid in full, or on the Closing Date will have paid in full,
all Taxes shown to be due and payable on said returns;
(b) Except as provided on Schedule 4.13, there is no action,
suit, proceeding, investigation, audit, or claim now pending or, to the
best knowledge of Sellers, threatened by any authority regarding any Taxes
relating to the Company for any Pre-Closing Period;
(c) There are no liens or security interests on any of the
assets of the Company that arose in connection with any failure (or alleged
failure) to pay any Taxes;
(d) There are no agreements for the extension or waiver of the
time for assessment of any Taxes relating to the Company for any Pre-
Closing Period and the Company has not been requested to enter into any
such agreement or waiver;
(e) All Taxes relating to the Company which the Company is
required by law to withhold or collect have been duly withheld or
collected, and have been timely paid over to the proper authorities to the
extent due and payable; and
-14-
(f) The Company is not now nor has it ever been a party to any
Tax allocation or sharing agreement that could result in any liability to
the Company or Buyer.
IV.14 Insurance. Set forth on Schedule 4.14 is a complete list of
---------
insurance policies that the Company maintains with respect to its respective
businesses, properties or employees. Such policies are in full force and effect
and are free from any right of termination on the part of the insurance
carriers. In the judgment of Sellers, such policies, with respect to their
amounts and types of coverage, are adequate to insure against risks to which the
Company and its property and assets are normally exposed in the operation of the
Business, subject to customary deductibles and policy limits.
IV.15 Intellectual Property. Schedule 4.15 sets forth all Intellectual
---------------------
Property owned by the Company. The operation of the Business requires no rights
under the Intellectual Property other than rights under the Intellectual
Property listed on Schedule 4.15 and rights granted to the Company pursuant to
agreements listed on Schedule 4.15. Except as otherwise set forth on Schedule
4.15, the Company owns all right, title and interest in the Intellectual
Property. No litigation is pending or, to the best knowledge of the Company,
threatened wherein the Company is accused of infringing or otherwise violating
the intellectual property rights of another, or of breaching a contract
conveying intellectual property rights.
IV.16 Compliance with Laws. The Company is in compliance with all
--------------------
applicable laws, regulations, orders, judgments and decrees applicable to the
Business, except where any noncompliance would not have a material adverse
effect on the business, condition (financial or otherwise) or assets of the
Company.
IV.17 Employment Relations. The Company is not engaged in any unfair
--------------------
labor practice.
IV.18 Employee Benefit Plans. Sellers have provided Buyer with copies of
----------------------
all Employee Benefit Plans of the Company. None of the Employee Benefit Plans
are subject to Title IV of ERISA or the minimum funding obligations of Section
412 of the Code, and the Company and any entity required to be aggregated
therewith pursuant to Section 414(b) or (c) of the Code have no liability under
Title IV of ERISA or under Section 412(f) or 412(n) of the Code.
IV.19 Environmental Laws and Regulations. Except as set forth on
----------------------------------
Schedule 4.19:
(a) The Company, Sellers or their authorized agents or
independent contractors (including suppliers) have not generated on, used
on, treated or stored on, transported to or from or arranged for
transportation to or from, the real property owned or leased by the Company
or any property adjoining such real property any Hazardous Materials,
-15-
(b) Hazardous Materials have not been disposed, discharged,
injected, spilled, leaked, leached, dumped, emitted, escaped, emptied,
allowed to seep, placed and the like, into or upon any land or water or
air, or otherwise allowed to enter into the environment (collectively,
"Releases") by the Company, Sellers, their authorized agents or independent
contractors (including suppliers) on such real property or by the Company,
Sellers or their agents on any other property,
(c) The Company is and has been in compliance with all
applicable Environmental Laws, possesses all Permits required thereunder
and is in compliance with all Permits issued thereunder with respect to
such real property and to the Company's operations conducted thereon,
(d) there are no pending or, to the best knowledge of Sellers,
threatened Environmental Claims against the Company or such real property,
(e) there are no facts or present or past circumstances,
conditions or occur rences on such real property known to Sellers that
reasonably could be anticipated (i) to form the basis of an Environmental
Claim against the Company or any owner or operator of such real property,
or (ii) to cause such real property to be subject to any restrictions on
the ownership, occupancy, use or transferability of such real property
under any Environmental Law,
(f) there are not now and, to the best knowledge of Sellers,
there never have been any underground storage tanks located on such real
property, and
(g) The Company has not in the ordinary course of business
transported, treated, disposed of or stored Hazardous Materials.
IV.20 Interests in Customers and Suppliers. Except for relationships
------------------------------------
with Affiliates and as set forth on Schedule 4.20 attached hereto, the Company
does not possess, directly or indirectly, any financial interest in, nor is any
Person associated with the Company as a director, officer or employee of, any
corporation, firm, association or business organization which is a supplier,
customer, lessor, lessee, or competitor of the Company.
IV.21 Compensation of Employees. Set forth on Schedule 4.21 is a
-------------------------
complete list of all employees of the Company showing (a) such individuals'
total compensation from the Company for the fiscal year ended on the Audit Date
and (b) compensation and salary rates for the current fiscal year. Except as set
forth on Schedule 4.21, no employee of the Company has been promised a bonus or
an increase in salary to take effect subsequent to the date hereof.
-16-
IV.22 Suppliers and Customers. Schedule 4.22 sets forth the five largest
-----------------------
suppliers and the ten largest customers of the Company by dollar volume in
fiscal 1995 and as of the date hereof. The relationship of the Company with
each of such suppliers and customers as of the date of this Agreement is, to the
best knowledge of the Company, a good commercial working relationship, and
except as set forth on Schedule 4.22, no significant supplier or client has
canceled or otherwise terminated or, to the best knowledge of Sellers,
threatened to cancel or otherwise terminate its relationship with the Company
since December 31, 1994.
IV.23 Absence of Changes. Except as set forth on Schedule 4.23, with
------------------
respect to the Company or the Business since the Audit Date there has not been
any:
(a) sale, assignment, pledge, hypothecation or other transfer of
any of the Company's assets or properties except in the ordinary course of
business;
(b) material adverse effect to the business, condition
(financial or otherwise) or assets of the Company or any condition or
contingency that might reasonably be expected to result in such material
adverse effect;
(c) termination of or material amendment to any Contract or
Lease except as reflected by any applicable Schedule;
(d) increase in compensation payable or paid to, or any
employment, bonus or compensation agreement entered into with, any officer,
director, employee, agent or independent contractor of the Company other
than in the ordinary course of business or other than as set forth on
Schedule 4.24;
(e) declaration or making, or agreement to declare or make, any
payment of dividends or distributions of any assets of any kind or
purchase, redemption or other acquisition, or agreement to purchase,
redeem or otherwise acquire, directly or indirectly, any of the Company's
outstanding capital stock; or merger, consolidation or agreement to merge
or consolidate with any other entity;
(f) agreement or arrangement creating any preferential rights to
purchase any of the Company's capital stock or assets or requiring the
consent of any party to the transfer or assignment of any of the Company's
capital stock or assets;
(g) other than in the ordinary course of business, a change in
the amount of all Accounts Receivable of the Company or other fees or debts
due to the Company or the allowances with respect thereto, or the payables
of the Company to trade accounts and other creditors by the Company, from
that reflected in the Balance Sheet;
-17-
(h) Contract or transaction entered into or agreed to by the
Company other than in the ordinary course of business; or
(i) agreement by the Company to do any of the things described
in the preceding clauses (a) through (h) except as contemplated in this
Agreement.
IV.24 Solvency and Indebtedness. Sellers are not entering into this
-------------------------
Agreement with actual intent to hinder, delay or defraud creditors. The
indebtedness of the Company to be paid at closing is in the amounts and payable
to the parties listed on Schedule 4.24.
IV.25 Disclosure. No representation or warranty by Sellers contained in
----------
this Agreement, nor any statement or certificate furnished or to be furnished by
Sellers to Buyer or its representatives in connection herewith or pursuant
hereto, contains or will contain any untrue statement of a material fact, or
omits or will omit to state any material fact required to make the statements
herein or therein contained not misleading or necessary in order to provide a
prospective purchaser of the Stock with adequate information as to the Company
and its condition (financial and otherwise), properties, assets, liabilities,
business and prospects, and Sellers have disclosed to Buyer in writing all
material adverse facts known to Sellers relating to the same. The
representations and warranties contained in this Article IV or elsewhere in this
Agreement or any document delivered pursuant hereto shall not be affected or
deemed waived by reason of the fact that Buyer and/or its representatives knew
or should have known that any such representation or warranty is or might be
inaccurate in any respect.
IV.26 Government Contracts. Except as set forth on Schedule 4.26, the
--------------------
Company does not have any Contracts with or provide any services to any agency
or department of the Government of the United States.
IV.27 Copies of Documents. The Company has made available for inspection
-------------------
and copying by Buyer and its advisers, true, complete and correct copies of all
documents referred to in this Article IV or in any Schedule attached hereto.
IV.28 No Subsidiaries. The Company has no subsidiaries and owns no
---------------
capital stock or equity interest in any entity.
IV.29 Books and Records. The Books and Records of the Company, as
-----------------
previously made available to Buyer and its representatives, contain accurate
records in all material respects of all meetings of, and corporate action taken
by (including action taken by written consent) the shareholders and Board of
Directors of the Company.
IV.30 Broker's or Finder's Fees. No Person acting on behalf of Sellers
-------------------------
is, or will be, entitled to any fee, commission or broker's or finder's fees in
connection with this Agreement or any of the transactions contemplated hereby.
-18-
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF BUYER
---------------------------------------
Buyer hereby represents and warrants to Sellers as follows:
V.1 Existence and Good Standing of Buyer; Power and Authority. Buyer is
---------------------------------------------------------
a corporation duly organized, validly existing and in good standing under the
laws of the State of Delaware. Buyer has full corporate power and authority to
make, execute, deliver and perform this Agreement and the Buyer's Agreements, to
perform its obligations hereunder and thereunder and to consummate the
transactions contemplated hereby and thereby. This Agreement and the Buyer's
Agreements have been duly authorized and approved by all required corporate
governance action of Buyer. This Agreement and the Buyer's Agreements have been,
as applicable as of the date hereof or as of the Closing Date, duly executed and
delivered by Buyer and are the valid and binding obligations of Buyer
enforceable against Buyer in accordance with their respective terms, except to
the extent that its enforceability may be subject to applicable bankruptcy,
insolvency, reorganization, moratorium and similar laws affecting the
enforcement of creditors' rights generally and by general equitable principles.
V.2 No Violations. Except with respect to the Amended and Restated
-------------
Loan Agreement dated August 3, 1995 ("Loan Agreement"), among Buyer, each of
Buyer's subsidiaries, and Finova, and with respect to the Amended and Restated
Subordinated Note, Preferred Stock and Warrant Purchase Agreement dated August
3, 1995, among Buyer, Continental Illinois Venture Corporation, CIVC Partners I,
GM Holdings, LLC, and certain other purchasers listed on the signature pages
thereto ("Subordinated Debt Agreement"), the execution, delivery and performance
of this Agreement and the Buyer's Agreements by Buyer and the consummation by
Buyer of the transactions contemplated hereby and thereby will not, with or
without the giving of notice or the lapse of time or both, (a) violate, conflict
with, or result in a breach or default under any provision of the charter or
bylaws of Buyer; (b) violate any statute, ordinance, rule, regulation, order,
judgment or decree of any court or of any governmental or regulatory body,
agency or authority applicable to Buyer or by which any of its properties or
assets may be bound; (c) require any filing by Buyer with, or require Buyer to
obtain any permit, consent or approval of, or require Buyer to give any notice
to, any governmental or regulatory body, agency or authority or any third party
other than the Commission, Finova and certain parties to the Subordinated Debt
Agreement; or (d) result in a violation or breach by Buyer of, conflict with,
constitute (with or without due notice or lapse of time or both) a default by
Buyer (or give rise to any right of termination, cancellation, payment or
acceleration) under, or result in the creation of any Encumbrance upon any of
the properties or assets of Buyer pursuant to, any of the terms, conditions or
provision of any note, bond, mortgage, indenture, permit, contract, lease or
other instrument or obligation to which Buyer is a party, or by which it or any
of its
-19-
properties or assets may be bound, except in the case of clauses (b), (c) and
(d) of this Section 5.2, for such violations, consents, breaches, defaults,
terminations and accelerations which in the aggregate would not have a material
adverse effect on the business, condition (financial or otherwise) or assets of
the Company.
V.3 Broker's or Finder's Fees. No Person acting on behalf of Buyer is,
-------------------------
or will be, entitled to any fee, commission or broker's or finder's fee in
connection with this Agreement or any of the transactions contemplated hereby.
ARTICLE VI
CONDITIONS TO SELLER'S OBLIGATIONS
----------------------------------
The obligations of Sellers under this Agreement to sell, or cause to be
sold, the Stock and to consummate the other transactions contemplated hereby
shall be subject to the satisfaction (or waiver by Sellers) on or prior to the
Closing Date of all of the following conditions:
VI.1 Truth of Representations and Warranties. The representations and
---------------------------------------
warranties of Buyer contained in this Agreement shall be true and correct on and
as of the Closing Date with the same effect as though such representations and
warranties had been made on and as of the Closing Date, and Buyer shall have
delivered to Sellers on the Closing Date a certificate of an authorized officer
of Buyer, dated the Closing Date, to such effect.
VI.2 Performance of Agreements. Each and all of the agreements and
-------------------------
covenants of Buyer to be performed on or before the Closing Date pursuant to the
terms hereof, including all deliveries and obligations at Closing, shall have
been duly performed, and Buyer shall have delivered to Sellers a certificate of
an authorized officer of Buyer, dated the Closing Date, to such effect and
evidencing the incumbency of all officers executing any documents in connection
with the Closing.
VI.3 No Litigation Threatened. No action or proceedings shall have been
------------------------
instituted before a court or other governmental body or by any public authority
to restrain or prohibit any of the transactions contemplated hereby, and Buyer
shall have delivered to Sellers a certificate of an authorized officer of Buyer,
dated the Closing Date, to such effect to the best knowledge of such officer.
VI.4 Governmental Approvals. With respect to the Company's common
----------------------
carrier licenses from the Commission, all governmental consents and approvals
necessary to permit the consummation of the transactions contemplated by this
Agreement shall have been received, including, but not limited to, all necessary
approvals of the Commission ("FCC Approvals"), and the FCC Approvals shall be
final and nonappealable. With respect to Sellers' private radio
-20-
licenses from the Commission, the parties shall have authority to close the
transactions contemplated by this Agreement pursuant to conditional temporary
authority under the Rules and Regulations.
VI.5 Proceedings. All proceedings to be taken in connection with the
-----------
transactions contemplated by this Agreement and all documents incident thereto
shall be reasonably satisfactory in form and substance to Sellers and their
counsel, and Sellers shall have received copies of all such documents and other
evidence as its or its counsel may reasonably request in order to establish the
consummation of such transactions and the taking of all proceedings in
connection therewith.
ARTICLE VII
CONDITIONS TO BUYER'S OBLIGATIONS
---------------------------------
The obligations of Buyer under this Agreement to purchase the Stock and to
consummate the other transactions contemplated hereby shall be subject to the
satisfaction (or waiver by Buyer) on or prior to the Closing Date of all of the
following conditions:
VII.1 Truth of Representations and Warranties. The representations and
---------------------------------------
warranties of Sellers contained herein shall be true and correct on and as of
the Closing Date with the same effect as though such representations and
warranties had been made on and as of the Closing Date, and Sellers shall have
delivered to Buyer on the Closing Date a certificate of Sellers, dated the
Closing Date, to such effect.
VII.2 Performance of Agreements. Each and all of the agreements and
-------------------------
covenants of Sellers to be performed on or before the Closing Date pursuant to
the terms hereof, including all deliveries and obligations at Closing, shall
have been duly performed, and Sellers shall have delivered to Buyer a
certificate of Sellers, dated the Closing Date, to such effect and evidencing
the incumbency of all officers executing any documents in connection with the
Closing.
VII.3 No Litigation Threatened. No action or proceedings shall have been
------------------------
instituted before a court or other governmental body or by any public authority
to restrain or prohibit any of the transactions contemplated hereby, and Sellers
shall have delivered to Buyer a certificate of Sellers, dated the Closing Date,
to such effect to the best knowledge of each Seller.
VII.4 Due Diligence. Buyer shall have concluded a due diligence review
-------------
of the Company satisfactory to Buyer in its sole discretion.
VII.5 Governmental Approvals. With respect to common carrier licenses,
----------------------
all governmental consents and approvals necessary to permit the consummation of
the transactions
-21-
contemplated by this Agreement shall have been received, including, but not
limited to, the FCC Approvals and the FCC Approvals shall be final and
nonappealable. With respect to Sellers' private radio licenses from the
Commission, the parties shall have authority to close the transactions
contemplated by this Agreement pursuant to conditional temporary authority under
the Rules and Regulations.
VII.6 Consents. Each of the consents referred to on Schedule 4.4
--------
attached hereto shall have been obtained. Buyer shall have received the consents
required under the Loan Agreement and the Subordinated Debt Agreement.
VII.7 Legal Opinions. Sellers shall have delivered to Buyer the opinion
--------------
of ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, III, Attorney at Law, counsel to Sellers, substantially
in the form of Exhibit "B-1" attached hereto, which opinion shall be acceptable
to Buyer and its counsel. Sellers also shall have delivered to Buyer the
opinion of Sellers' counsel with regard to matters relating to the Company's
Permits with the Commission, in form and substance acceptable to Buyer and its
counsel substantially in the form of Exhibit "B-2" attached hereto.
VII.8 Schedules. Buyer shall have received the Schedules to be attached
---------
hereto and shall have concluded a due diligence review of the Company, both
satisfactory to Buyer in its sole discretion.
VII.9 Proceedings. All proceedings to be taken in connection with the
-----------
transactions contemplated by this Agreement and all documents incident thereto
shall be reasonably satisfactory in form and substance to Buyer and its counsel,
and Buyer shall have received copies of all such documents and other evidence as
it or its counsel may reasonably request in order to establish the consummation
of such transactions and the taking of all proceedings in connection therewith.
ARTICLE VIII
COVENANTS OF SELLER
-------------------
Sellers hereby covenant and agree with Buyer as follows:
VIII.1 Cooperation by Sellers. Sellers shall use their reasonable best
----------------------
efforts to cooperate with Buyer to secure all necessary consents, approvals,
authorizations, exemptions and waivers from third parties as shall be required
in order to enable Sellers to effect the transactions contemplated hereby, and
Sellers shall otherwise use their reasonable best efforts to cause the
consummation of such transactions in accordance with the terms and conditions
hereof and to cause all conditions contained in this Agreement over which it has
control to be satisfied. Sellers further agree to deliver to Buyer prompt
written notice of any event or condition known to or
-22-
discovered by Sellers, which if it existed on the date of this Agreement or on
the Closing Date, would result in any of the representations and warranties of
Sellers contained herein being untrue in any material respect.
VIII.2 Notice of Breaches. Sellers shall deliver to Buyer prompt written
------------------
notice of any event or condition actually known to or discovered by Sellers,
which, if it existed on the date of this Agreement or on the Closing Date, would
result in any of the representations and warranties of Sellers contained herein
being untrue in any material respect. Upon the discovery and subsequent notice
of such an event or condition, Buyer and Sellers shall be entitled to the rights
and remedies set forth in Section 11.2.
VIII.3 Conduct of Business. Except as Buyer may otherwise consent to in
-------------------
writing, between the date hereof and the Closing Date, Sellers shall cause the
Company to, (a) conduct the Business only in the ordinary course, (b) use their
reasonable efforts to keep available the services of the Company's employees and
maintain the Company's current relationships with licensors, suppliers, lessors,
distributors, customers, clients and others, (c) maintain, consistent with past
practice and good business judgment, all of the assets and properties of the
Company in customary repair, order and condition, ordinary wear and tear
excepted, and insurance upon all of the assets used in the conduct of the
Business in such amounts and of such kinds comparable to that in effect on the
date hereof, to the extent available at current premiums, and (d) maintain the
Books and Records in the usual, regular and ordinary manner, on a basis
consistent with past practice.
VIII.4 Negative Covenants of Seller. From and after the date hereof and
----------------------------
through the Closing Date and except with the specific prior written consent of
Buyer, Sellers covenant and agree that Sellers shall not allow the Company to:
(a) sell, transfer or dispose of any of its assets or properties
other than in the ordinary course of business; provided, however, that any
sale, transfer or disposition of any assets in the ordinary course of
business shall not exceed assets valued at more than $5,000 in the
aggregate;
(b) grant, nor shall Sellers grant, an Encumbrance (except a
Permitted Encumbrance) on any of the assets or properties of the Company or
allow any such Encumbrance (except a Permitted Encumbrance) to occur or to
be created;
(c) except in the ordinary course of business, acquire any
tangible properties or assets relating to the Business;
(d) enter into any employment and/or any independent contractor
agreements relating to services to be rendered in connection with the
Business or any of the assets
-23-
except in the ordinary course of business;
(e) except in the ordinary course of business, amend, modify or
terminate, without the prior written consent of Buyer, any of the
Contracts, Leases or other agree ments of the Company;
(f) incur any indebtedness;
(g) enter into any undertaking to furnish services for any
consideration other than money with respect to the operation of the
Company's assets or properties other than trades of paging services for
advertising in the normal course of business and consistent with historic
levels; and
(h) grant any subscriptions, options, convertible securities,
warrants, calls or rights of any kind (issued, contracted for or granted
by, or binding upon, Sellers) to purchase or otherwise acquire any security
of or equity interest in Sellers. Sellers shall not allow the Company to
issue any shares of authorized but unissued shares of capital stock.
VIII.5 Exclusive Dealing. During the period from the date of this
-----------------
Agreement to the earlier of the Closing Date or the termination of this
Agreement, Sellers shall not take any action, directly or indirectly, to
encourage, initiate or engage in discussions or negotiations with, or provide
any information to, any Person other than Buyer, concerning any sale of Stock or
any assets of properties of the Company or a similar transaction involving
Sellers or the Company.
VIII.6 Review of the Assets. Sellers agree that Buyer may, prior to the
--------------------
Closing Date, through its representatives, review (a) the assets and properties
of the Company, (b) the complete working papers of Sellers' certified public
accountants used in their preparation of financial statements of the Company,
and (c) the Books and Records of the Company and otherwise review the financial
and legal condition of the Company as Buyer deems necessary or advisable to
familiarize itself with the Business and related matters; such review shall not,
however, affect the representations and warranties made by Sellers hereunder or
the remedies of Buyer for breaches of those representations and warranties.
Buyer may also, prior to the Closing Date, through its representatives, inspect
any or all of the Company's towers and other transmitting facilities. Such
review and inspection shall occur only during normal business hours upon
reasonable notice by Buyer. Sellers shall permit Buyer and its representatives
to have, after the execution of this Agreement, full access to employees of the
Company who can furnish Buyer with financial and operating data and other
information with respect to the Business as Buyer shall from time to time
reasonably request. Until the Closing Date, Seller agrees to provide Buyer with
monthly financial reports within ten days of the end of each month.
-24-
VIII.7 Governmental Filings. It is expressly acknowledged and agreed
--------------------
that, as soon as practicable after the execution of this Agreement, but in no
event more than fifteen (15) days from the date hereof, Buyer and Sellers shall
file any forms required by the Commission to transfer the Stock. Sellers agree
that they will cooperate with Buyer in all respects in connection with such
filings and in connection with any requests for information or further filings
which may be necessary in order to obtain the necessary consents (or to allow
the applicable time periods to expire) with respect thereto. Sellers shall
deliver to Buyer and its counsel drafts of such filings by Sellers and all other
materials to be submitted sufficiently in advance of any such submission so that
Buyer and its counsel may review and comment upon such filings and other
materials.
VIII.8 Further Assurances. At any time or from time to time after the
------------------
Closing Date, Sellers shall, at the reasonable request of Buyer, execute and
deliver any further instruments or documents and take all such further action as
Buyer may reasonably request in order to consummate and make effective the sale
of the Stock pursuant to this Agreement.
ARTICLE IX
COVENANTS OF BUYER
------------------
Buyer hereby covenants and agrees with Sellers as follows:
IX.1 Cooperation by Buyer. Buyer will use its reasonable best efforts,
--------------------
and will cooperate with Sellers, to secure all necessary consents, approvals,
authorizations, exemptions and waivers from third parties as shall be required
in order to enable Buyer to effect the transactions contemplated on its part
hereby, and Buyer will otherwise use its reasonable best efforts to cause the
consummation of such transactions in accordance with the terms and conditions
hereof and to cause all conditions contained in this Agreement over which it has
control to be satisfied.
IX.2 Books and Records; Personnel. At all times after the Closing Date,
----------------------------
Buyer shall allow Sellers and any agents of Sellers, upon reasonable advance
notice to Buyer, access to all Books and Records of the Company which are
transferred to Buyer in connection herewith, to the extent necessary or
desirable in anticipation of, or preparation for, existing or future litigation,
employment matters, tax returns or audits, or reports to or filings with
governmental agencies, during normal working hours at the location where such
Books and Records are maintained and Sellers shall have the right, at Sellers'
sole cost, to make copies of any such Books and Records. Buyer agrees to
maintain all Books and Records of the Company for a period of six years from the
Closing Date.
IX.3 Further Assurances. At any time or from time to time after the
------------------
Closing Date,
-25-
Buyer shall, at the request of Sellers and at Sellers' expense, execute and
deliver any further instruments or documents and take all such further action as
Sellers may reasonably request in order to consummate and make effective the
sale of the Stock pursuant to this Agreement.
IX.4 Governmental Filings. It is expressly acknowledged and agreed
--------------------
that, as soon as practicable after the execution of this Agreement, but in no
event more than fifteen (15) days from the date hereof, Buyer and Sellers shall
file any forms required by the Commission to authorize the transfer of the
Stock. Buyer agrees that it will cooperate with Sellers in all respects in
connection with such filings and in connection with any requests for information
or further filings which may be necessary in order to obtain the necessary
consents (or to allow the applicable time periods to expire) with respect
thereto. Buyer shall deliver to Sellers and their counsel drafts of such filings
by Buyer and all other materials to be submitted sufficiently in advance of any
such submission so that Sellers and their counsel may review and comment upon
such filings and other materials.
ARTICLE X
THE CLOSING
-----------
X.1 Time and Place. The closing of the transactions contemplated by
--------------
this Agreement (the "Closing") will take place at 9:00 a.m. at the offices of
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, III, Attorney at Law, located at ▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇
▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ on or before August 1, 1996 or at such other time,
at such other place or on such other date as the parties hereto may mutually
agree. The date on which the Closing occurs is herein referred to as the
"Closing Date," and the transactions contemplated by this Agreement shall be
deemed to be effective as of 12:01 a.m. on the Closing Date.
X.2 Sellers' Obligations. At the Closing, Sellers shall deliver to
--------------------
Buyer, against delivery of the items specified in Section 10.3:
(a) the certificates representing the Stock together with stock
powers executed in blank;
(b) the Sellers' Agreements executed by Sellers;
(c) certified copies of the Articles of Incorporation, Bylaws
and Good Standing and Existence Certificates of the Company;
(d) all Books and Records of the Company, including all
Contracts and Leases of the Company;
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(e) the certifications required by Section 7.1, 7.2 and 7.3
which may be contained in one certificate;
(f) the consents to assignment of the Contracts and Leases as
required by Section 7.6;
(g) the legal opinions as required by Section 7.7;
(h) evidence of final and nonappealable FCC Approvals;
(i) a ▇▇▇▇ of sale executed by ▇▇▇ ▇. ▇▇▇▇▇▇ and any other
documents or instruments reasonably requested by Buyer to transfer title to
the Equipment to Buyer or to the Company, with such terms and provisions as
are reasonably satisfactory to Buyer and Sellers;
(j) the certificate of title executed by a duly authorized
officer of the Company or any other document or instrument reasonably
necessary to transfer title to the Excluded Asset to ▇▇▇ ▇. ▇▇▇▇▇▇, with
such terms and provisions as are reasonably satisfactory to ▇▇▇ ▇. ▇▇▇▇▇▇
and Buyer; and
(k) such other instruments, documents and certificates in form
and substance reasonably satisfactory to Buyer, as Buyer shall have
reasonably required.
X.3 Buyer's Obligations. At the Closing, Buyer shall deliver to
-------------------
Sellers or others, as indicated below, against delivery of the items specified
in Section 10.2:
(a) a wire transfer for the total of the Purchase Price, as
adjusted pursuant to Section 3.2;
(b) a wire transfer to the escrow agent under the Escrow
Agreement in the amount of the Holdback;
(c) wire transfers to the debtholders of the Company for the
amount of the indebtedness indicated on Schedule 4.24;
(d) the Buyer's Agreements executed by a duly authorized officer
of Buyer;
(e) evidence of final and nonappealable FCC Approvals; and
(f) the certifications required by Sections 6.1, 6.2 and 6.3
which may be contained in one certificate.
-27-
ARTICLE XI
TERMINATION
-----------
XI.1 Termination. This Agreement may be terminated and the transactions
-----------
contemplated hereby may be abandoned at any time prior to the Closing Date:
(a) by the mutual written consent of Buyer and Sellers;
(b) by either Buyer or all Sellers on or after August 1, 1996,
if the Closing has not occurred by such date, provided that as of such date
neither Buyer nor any of the Sellers is in default or that both Buyer and
any of the Sellers are in default under this Agreement; or
(c) by Buyer or all Sellers in writing, without prejudice to
other rights and remedies which the terminating party may have (provided
the terminating party is not otherwise in material default or breach of
this Agreement, or has failed or refused to close without justification
hereunder), if the other party shall (i) materially fail to perform its
covenants or agreements contained herein required to be performed prior to
the Closing Date, or (ii) materially breach or have breached any of its
representations or warranties contained herein.
XI.2 Remedies Upon Default or Failure to Close.
-----------------------------------------
(a) If Buyer shall default in the performance of its obligations
under this Agreement, and shall for this reason be unable to consummate
this Agreement on the Closing Date in accordance with the terms hereof, and
provided that Sellers are not then in material default of any of their
obligations hereunder, Sellers shall be entitled to terminate this
Agreement; provided, however, that Buyer shall have a period of ten (10)
days following written notice from Sellers to cure any breach of this
Agreement, if such breach is curable.
(b) If any Seller shall default in the performance of its
obligations under this Agreement, including, but not limited to, the
failure of any condition to Closing in Article VII or the failure to make
any required delivery under Section 10.2, and shall for that reason be
unable to consummate this Agreement on the Closing Date in accordance with
the terms hereof, and if Buyer is not then in material default of any of
its obligations hereunder, Buyer shall be entitled either (i) to waive any
such defaults by such Seller and to require such Seller through specific
performance (which such Seller acknowledges to be an appropriate remedy) to
consummate the sale in accordance with the terms of this
-28-
Agreement or (ii) to terminate this Agreement; provided, however that
Sellers shall have a period of ten (10) days following written notice from
Buyer to cure any breach of this Agreement if such breach is curable. The
availability of specific performance shall be in addition to any other
remedies or claims for damages Buyer may have at law or in equity for
breaches or defaults by Sellers of Sellers' obligations hereunder or for
Buyer's remedies pursuant to Article XII hereof.
XI.3 Effect on Obligations. Termination of this Agreement pursuant to
---------------------
this Article shall terminate all obligations of the parties hereunder, except
for (i) the obligations under Sections 11.2, 13.1, 13.2, 13.9 and 13.10 hereof
and the remedies under Article XII, (ii) the obligations set forth in the next
succeeding sentence of this Section 11.3, and (iii) the obligations under the
Confidentiality Agreement between the parties dated effective as of September
18, 1995 (the "Confidentiality Agreement"). Upon any termination of this
Agreement each party hereto will redeliver all documents, work papers and other
material of any other party relating to the transactions contemplated hereby,
and all copies of such materials, whether so obtained before or after the
execution hereof, to the party furnishing the same.
ARTICLE XII
SURVIVAL AND INDEMNIFICATION
----------------------------
XII.1 Indemnification of Seller. Buyer shall indemnify and hold Sellers
-------------------------
and its Affiliates (the "Sellers Indemnitees") harmless from and against any and
all damages, including exemplary damages and penalties, losses, deficiencies,
costs, expenses, obligations, fines, expenditures, claims and liabilities,
including reasonable counsel fees and reasonable expenses of investigation,
defending and prosecuting litigation (collectively, the "Damages"), suffered by
the Sellers Indemnitees as a result of, caused by, arising out of, or in any way
relating to (a) any misrepresentation, breach of warranty, or nonfulfillment of
any agreement or covenant on the part of Buyer under this Agreement or any
misrepresentation in or omission from any list, schedule, certificate, or other
instrument furnished or to be furnished to Sellers by Buyer pursuant to the
terms of this Agreement, or (b) any liability or obligation (other than those
for which Buyer is being indemnified by Sellers hereunder) which pertains to the
ownership, operation or conduct of the Business or assets arising from any acts,
omissions, events, conditions or circumstances occurring on or after the Closing
Date.
XII.2 Indemnification of Buyer. Sellers shall, jointly and severally,
------------------------
indemnify and hold Buyer and its Affiliates (the "Buyer Indemnitees") harmless
from and against any and all Damages suffered by Buyer Indemnitees as a result
of, caused by, arising out of, or in any way relating to (a) any
misrepresentation, breach of warranty, nonfulfillment of any agreement or
covenant on the part of Sellers under this Agreement, or any misrepresentation
in or omission from any list, schedule, certificate or other instrument
furnished or to be furnished to Buyer by
-29-
Sellers pursuant to the terms of this Agreement, or (b) any liability or
obligation (other than those for which Seller is being indemnified by Buyer
hereunder) which pertains to the ownership, operation or conduct of the Business
or assets arising from any acts, omissions, events, conditions or circumstances
occurring prior to the Closing Date.
XII.3 Demands. Each indemnified party hereunder agrees that promptly
-------
upon its discovery of facts giving rise to a claim for indemnity under the
provisions of this Agreement, including receipt by it of notice of any demand,
assertion, claim, action or proceeding, judicial or otherwise, by any third
party (such third party actions being collectively referred to herein as the
"Claim"), with respect to any matter as to which it claims to be entitled to
indemnity under the provisions of this Agreement, it will give prompt notice
thereof in writing to the indemnifying party, together with a statement of such
information respecting any of the foregoing as it shall have. Such notice shall
include a formal demand for indemnification under this Agreement. The
indemnifying party shall not be obligated to indemnify the indemnified party
with respect to any Claim if the indemnified party knowingly failed to notify
the indemnifying party thereof in accordance with the provisions of this
Agreement in sufficient time to permit the indemnifying party or its counsel to
defend against such matter and to make a timely response thereto including,
without limitation, any responsive motion or answer to a complaint, petition,
notice or other legal, equitable or administrative process relating to the
Claim, only insofar as such knowing failure to notify the indemnifying party has
actually resulted in prejudice or damage to the indemnifying party.
XII.4 Right to Contest and Defend. The indemnifying party shall be
---------------------------
entitled at its cost and expense to contest and defend by all appropriate legal
proceedings any Claim with respect to which it is called upon to indemnify the
indemnified party under the provisions of this Agreement; provided, that notice
of the intention to contest shall be delivered by the indemnifying party to the
indemnified party within twenty (20) days from the date of receipt by the
indemnifying party of notice by the indemnified party of the assertion of the
Claim. Any such contest may be conducted in the name and on behalf of the
indemnifying party or the indemnified party as may be appropriate. Such contest
shall be conducted by reputable counsel employed by the indemnifying party, but
the indemnified party shall have the right but not the obligation to participate
in such proceedings and to be represented by counsel of its own choosing at its
sole cost and expense. The indemnifying party shall have full authority to
determine all action to be taken with respect thereto; provided, however, that
the indemnifying party will not have the authority to subject the indemnified
party to any obligation whatsoever, other than the performance of purely
ministerial tasks or obligations not involving material expense. If the
indemnifying party does not elect to contest any such Claim, the indemnifying
party shall be bound by the result obtained with respect thereto by the
indemnified party, having used its reasonable best efforts in resolution. At
any time after the commencement of the defense of any Claim, the indemnifying
party may request the indemnified party to agree in writing to the abandonment
of such contest or to the payment or compromise by the indemnified party of the
-30-
asserted Claim, whereupon such action shall be taken unless the indemnified
party determines that the contest should be continued, and so notifies the
indemnifying party in writing within fifteen (15) days of such request from the
indemnifying party. If the indemnified party determines that the contest should
be continued, the indemnifying party shall be liable hereunder only to the
extent of the amount that the other party to the contested Claim had agreed
unconditionally to accept in payment or compromise as of the time the
indemnifying party made its request therefor to the indemnified party.
XII.5 Cooperation. If requested by the indemnifying party, the
-----------
indemnified party agrees to cooperate with the indemnifying party and its
counsel in contesting any Claim that the indemnifying party elects to contest
or, if appropriate, in making any counterclaim against the person asserting the
Claim, or any cross-complaint against any person, and the indemnifying party
will reimburse the indemnified party for any expenses incurred by it in so
cooperating. If the indemnifying party has not chosen to contest a Claim, the
indemnifying party shall cooperate with the indemnified party and its counsel in
contesting any Claim at no cost or expense to the indemnified party.
XII.6 Right to Participate. The indemnified party agrees to afford the
--------------------
indemnifying party and its counsel the opportunity to be present at, and to
participate in, conferences with all persons, including governmental
authorities, asserting any Claim against the indemnified party or conferences
with representatives of or counsel for such persons at the indemnifying party's
sole cost and expense.
XII.7 Payment of Damages. The indemnifying party shall pay to the
------------------
indemnified party in immediately available funds any amounts to which the
indemnified party may become entitled by reason of the provisions of this
Agreement subject to offset for any insurance proceeds actually received by the
indemnified party, such payment to be made within five days after any such
amounts are finally determined either by mutual agreement of the parties hereto
or pursuant to the final unappealable judgment of a court of competent
jurisdiction. The availability of insurance proceeds shall not delay or
postpone any indemnification payment required hereunder. If the indemnified
party both collects any such insurance proceeds and receives a payment from the
indemnifying party hereunder, and the sum of such proceeds and payment is in
excess of the amount payable with respect to the matter that is the subject of
the indemnity, then the indemnified party shall promptly refund to the
indemnifying party the amount of such excess, if permitted by the applicable
insurance policy(ies). Except as otherwise provided in the preceding sentence,
the indemnified party's receipt of any such insurance proceeds shall not
eliminate or reduce the obligations of the indemnifying party or the rights of
the indemnified party hereunder, but shall reduce the amount of the obligation
in the amount of such insurance proceeds paid.
XII.8 Survival of Representations and Warranties. The representations
------------------------------------------
and warranties contained in Articles IV and V of this Agreement shall survive
until the fifth anniversary date of
-31-
the Closing Date except for the representations and warranties in Sections 4.2,
4.3, 4.8, 4.12 and 5.1 which shall survive forever.
ARTICLE XIII
MISCELLANEOUS
-------------
XIII.1 Notices. Any notice, request, instruction, correspondence or other
-------
document to be given hereunder by either party to the other (herein collectively
called "Notice") shall be in writing and delivered in person or by courier
service requiring acknowledgment of receipt of delivery or mailed by certified
mail, postage prepaid and return receipt requested, or by telecopier, as
follows:
If to Sellers prior to Closing, addressed to:
▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇▇▇▇▇▇'▇ Communication, Inc.
(d/b/a Louisiana Paging & Communications Co.)
▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy prior to Closing to:
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, III, Attorney at Law
▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
and to:
▇▇. ▇▇▇▇ ▇▇▇▇▇▇▇, CPA
▇▇▇▇▇▇▇ and ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
If to Sellers after Closing, addressed to:
▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-32-
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
If to Buyer, addressed to:
Teletouch Communications, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy prior to Closing to:
▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ III
▇▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇, L.L.P.
South Tower Pennzoil Place
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Notice given by personal delivery, courier service or mail shall be effective
upon actual receipt. Notice given by telecopier shall be confirmed by
appropriate answer back and shall be effective upon actual receipt if received
during the recipient's normal business hours, or at the beginning of the
recipient's next Business Day after receipt if not received during the
recipient's normal business hours. All Notices by telecopier shall be confirmed
promptly after transmission in writing by certified mail or personal delivery.
Any party may change any address to which Notice is to be given to it by giving
Notice as provided above of such change of address.
XIII.2 Governing Law. The provisions of this Agreement shall be governed
-------------
by and construed and enforced in accordance with the laws of the State of
Louisiana (excluding any conflicts-of-law rule or principle that might refer
same to the laws of another jurisdiction).
XIII.3 Entire Agreement; Amendments and Waivers. This Agreement
----------------------------------------
(including the exhibits and schedules hereto) and the Confidentiality Agreement
constitute the entire agreement between the parties hereto pertaining to the
subject matter hereof and supersede all prior agreements, understandings,
negotiations and discussions, whether oral or written, of the parties, and there
are no warranties, representations or other agreements between the parties in
connection with the subject matter hereof except as set forth specifically
herein or contemplated hereby. No supplement, modification or waiver of this
Agreement shall be binding unless executed in writing by the party to be bound
thereby. The failure of a party to exercise any right or remedy shall not be
deemed or constitute a waiver of such right or remedy in the future. No
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waiver of any of the provisions of this Agreement shall be deemed or shall
constitute a waiver of any other provision hereof (regardless of whether
similar), nor shall any such waiver constitute a continuing waiver unless
otherwise expressly provided.
XIII.4 Binding Effect and Assignment. This Agreement shall be binding
-----------------------------
upon and inure to the benefit of the parties hereto and their respective
permitted successors and assigns. Neither this Agreement nor any of the rights,
benefits or obligations hereunder shall be assigned by either party without the
prior written consent of the other party; provided, however, that Buyer may
assign this Agreement to a wholly-owned subsidiary of Buyer. The parties
acknowledge that Buyer has entered into that certain Agreement and Plan of
Merger by and among ProNet Inc. ("ProNet"), ProNet Subsidiary Inc. and Buyer
dated April 15, 1996 and that as a result of the merger, ProNet or a subsidiary
of ProNet will succeed to the rights and obligations of Buyer hereunder.
XIII.5 Severability. If any provision of the Agreement is rendered or
------------
declared illegal or unenforceable by reason of any existing or subsequently
enacted legislation or by decree of a court of last resort, Buyer and Seller
shall promptly meet and negotiate substitute provisions for those rendered or
declared illegal or unenforceable so as to preserve as nearly as possible the
contemplated economic effects of the transactions, but all of the remaining
provisions of this Agreement shall remain in full force and effect.
XIII.6 Headings. The headings of the 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.
XIII.7 Execution. This Agreement may be executed in multiple counterparts
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each of which shall be deemed an original and all of which shall constitute one
instrument.
XIII.8 Sales and Transfer Taxes. Buyer shall be responsible for and pay
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any applicable sales, stamp, transfer, documentary, use, registration, filing
and other taxes and fees (including any penalties and interest) that may become
due or payable in connection with this Agreement and the transactions
contemplated hereby.
XIII.9 Expenses. Except as otherwise provided in this Agreement, Seller
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and Buyer shall each pay all costs and expenses incurred by them or on their
behalf in connection with this Agreement and the transactions contemplated
hereby, provided, however, that Buyer and Seller shall share equally all filing
fees payable to the Commission.
XIII.10 Publicity. Except as otherwise required by applicable laws or
---------
regulations, Seller or Buyer shall not issue any press release or make any other
public statement, in each case relating to or connected with or arising out of
this Agreement or the matters contained herein, without obtaining the prior
approval of the other party hereto to the contents and the manner of
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presentation and publication thereof.
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IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to
be executed on its behalf as of the date first above written.
BUYER:
TELETOUCH COMMUNICATIONS, INC.
By:_____________________________________
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Chairman and Chief Executive Officer
SELLERS:
________________________________________
▇▇▇ ▇. ▇▇▇▇▇▇
________________________________________
▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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