EXHIBIT 2.3
AGREEMENT AND PLAN OF MERGER
By and Between
AMERICAN TOWER SYSTEMS CORPORATION
and
AMERICAN TOWER CORPORATION
Dated as of
DECEMBER 12, 1997
TABLE OF CONTENTS
Page
ARTICLE 1
DEFINED TERMS............................................................................................1
ARTICLE 2
THE MERGER...............................................................................................2
2.1 The Merger.............................................................................2
2.2 Closing................................................................................2
2.3 Effective Time.........................................................................2
2.4 Effect of the Merger...................................................................2
2.5 Certificate of Incorporation...........................................................2
2.6 Bylaws.................................................................................2
2.7 Directors and Officers.................................................................2
ARTICLE 3
CONVERSION OF SHARES; EXCHANGE OF CERTIFICATES...........................................................3
3.1 Conversion of Capital Stock............................................................3
3.2 Surrender of Certificates; Payment of Merger Consideration and
Preferred Stock Merger Consideration...................................................4
3.3 Stock Transfer Books...................................................................4
3.4 Dissenting Shares......................................................................5
ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF ATC ...................................................................5
4.1 Organization and Business; Power and Authority; Effect of Transaction..................5
4.2 Financial and Other Information. .....................................................7
4.3 Material Statements and Omissions; Absence of Events...................................7
4.4 Title to Properties; Leases............................................................8
4.5 Compliance with Private Authorizations.................................................9
4.6 Compliance with Governmental Authorizations and Applicable Law.........................9
4.7 Intangible Assets......................................................................9
4.8 Related Transactions..................................................................10
4.9 Insurance.............................................................................10
4.10 Tax Matters. ........................................................................10
4.11 Employee Retirement Income Security Act of 1974.......................................10
4.12 Absence of Sensitive Payments.........................................................12
4.13 Bank Accounts, Etc....................................................................12
4.14 Employment Arrangements...............................................................13
4.15 Material Agreements...................................................................13
4.16 Ordinary Course of Business...........................................................13
4.17 Material and Adverse Restrictions.....................................................14
4.18 Broker or Finder......................................................................15
4.19 Solvency..............................................................................15
4.20 Environmental Matters.................................................................15
4.21 Capital Stock.........................................................................16
4.22 State Takeover Statutes...............................................................16
ARTICLE 5
REPRESENTATIONS AND WARRANTIES OF ATS...................................................................16
5.1 Organization and Business; Power and Authority; Effect of Transaction.................16
5.2 Financial and Other Information. ....................................................18
5.3 Material Statements and Omissions; Absence of Events..................................18
5.4 Title to Properties; Leases...........................................................18
5.5 Compliance with Private Authorizations................................................19
5.6 Compliance with Governmental Authorizations and Applicable Law........................20
5.7 Intangible Assets.....................................................................20
5.8 Related Transactions..................................................................20
5.9 Insurance.............................................................................21
5.10 Tax Matters. ........................................................................21
5.11 Employee Retirement Income Security Act of 1974.......................................21
5.12 Absence of Sensitive Payments.........................................................23
5.13 Employment Arrangements...............................................................24
5.14 Material Agreements...................................................................24
5.15 Ordinary Course of Business...........................................................24
5.16 Material and Adverse Restrictions.....................................................25
5.17 Broker or Finder......................................................................26
5.18 Solvency..............................................................................26
5.19 Environmental Matters.................................................................26
5.20 Capital Stock.........................................................................27
5.21 State Takeover Statutes...............................................................27
5.22 ATS Private Placement.................................................................27
5.23 ARS Organization and Business; Power and Authority; Effect of Transaction.............27
ARTICLE 6
COVENANTS...............................................................................................29
6.1 Access to Information; Confidentiality................................................29
6.2 Agreement to Cooperate. .............................................................30
6.3 Public Announcements..................................................................31
6.4 Notification of Certain Matters.......................................................31
6.5 No Solicitation.......................................................................31
6.6 Conduct of Business by ATS Pending the Merger.........................................32
6.7 Conduct of Business by ATC Pending the Merger.........................................34
6.8 Directors', Officers' and Employees' Indemnification and Insurance....................36
6.9 ATC Employees and Benefit Plans.......................................................37
6.10 ATC Stock Options.....................................................................38
6.11 ATS Voting Agreement. ...............................................................39
6.13 Registration Statement and Proxy/Information Statement. .............................39
6.14 Listing of ATS Class A Common Stock...................................................40
6.15 Solicitation of Employees.............................................................40
6.16 Additional Tax Matters................................................................40
6.17 ATS Registration Rights Agreement.....................................................41
6.18 Charter Amendment.....................................................................41
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6.19 Conversion of Class B Common Stock....................................................41
6.20 ATS Separation Agreement..............................................................41
6.21 CBS Merger or Tower Distribution Related Actions......................................41
6.22 Efforts Regarding Pending Transactions................................................41
6.23 Certain Closing Certificates..........................................................41
6.25 Issue of ATS Class B Common Stock.....................................................42
6.26 Election of ATS Directors.............................................................42
ARTICLE 7
CLOSING CONDITIONS......................................................................................42
7.1 Conditions to Obligations of Each Party...............................................42
7.2 Conditions to Obligations of ATS......................................................43
7.3 Conditions to Obligations of ATC. ...................................................44
ARTICLE 8
TERMINATION, AMENDMENT AND WAIVER.......................................................................45
8.1 Termination...........................................................................45
8.2 Effect of Termination.................................................................46
ARTICLE 9
GENERAL PROVISIONS......................................................................................47
9.1 Waivers; Amendments...................................................................47
9.2 Fees, Expenses and Other Payments.....................................................47
9.3 Notices...............................................................................47
9.4 Specific Performance; Other Rights and Remedies.......................................48
9.5 Severability..........................................................................48
9.6 Counterparts..........................................................................49
9.7 Section Headings......................................................................49
9.8 Governing Law.........................................................................49
9.9 Further Acts..........................................................................49
9.10 Entire Agreement......................................................................49
9.11 Assignment............................................................................50
9.12 Parties in Interest...................................................................50
9.13 Non-Survival of Representations, Warranties, Covenants and Agreements.................50
APPENDIX A: Definitions
EXHIBITS:
EXHIBIT A: Certificate of Merger (Section 2.3).
EXHIBIT B-1: Existing ATS Restated Certificate of Incorporation
(Section 2.5).
EXHIBIT B-2 Principles on which to restate Existing ATS Restated
Certificate of Incorporation
(Section 2.5).
EXHIBIT C: ATS Voting Agreement (Section 6.11).
EXHIBIT D: ATS Registration Rights Agreement (Section 6.17)
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EXHIBIT E: ATC Affiliate Agreement (Section 6.24).
EXHIBIT F: Opinion of ▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP (Section 7.2(a)).
EXHIBIT G: Tax Certificate of ATC and the ATC stockholders
(Section 7.2(d)).
EXHIBIT H: Opinion of ▇▇▇▇▇▇▇▇ & Worcester LLP (Section 7.3(a)).
EXHIBIT I: Tax Certificate of ATS (Section 7.3(f)).
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AGREEMENT AND PLAN OF MERGER
Agreement and Plan of Merger, dated as of December 12, 1997, by and
among American Tower Systems Corporation, a Delaware corporation ("ATS"), and
American Tower Corporation, a Delaware corporation ("ATC").
W I T N E S S E T H:
WHEREAS, the Boards of Directors of ATC and ATS have determined that
the merger (the "Merger") of ATC into ATS on the terms and conditions set forth
in this Agreement and Plan of Merger (this "Agreement") is consistent with and
in furtherance of the long-term business strategy of each, and is fair to, and
in the best interests of, ATS, ATC and the stockholders of each; and
WHEREAS, this Agreement provides that ATC shall be merged with and
into ATS, and ATS shall be the surviving corporation; and
WHEREAS, the Boards of Directors of ATC and ATS have approved and
adopted this Agreement and have directed that this Agreement be submitted to the
stockholders of ATC and ATS, respectively, for their adoption and approval; and
WHEREAS, the Board of Directors of American Radio Systems Corporation,
a Delaware corporation ("ARS"), has approved and adopted this Agreement and
approved the Merger on behalf of ARS as the sole stockholder of ATS;
NOW, THEREFORE, in consideration of the premises and the
representations, warranties, covenants and agreements herein contained and other
valuable consideration, the receipt and adequacy whereof are hereby
acknowledged, the parties hereto hereby, intending to be legally bound,
represent, warrant, covenant and agree as follows:
ARTICLE 1
DEFINED TERMS
As used herein, unless the context otherwise requires, the terms
defined in Appendix A shall have the respective meanings set forth therein.
Terms defined in the singular shall have a comparable meaning when used in the
plural, and vice versa, and the reference to any gender shall be deemed to
include all genders. Unless otherwise defined or the context otherwise clearly
requires, terms for which meanings are provided in this Agreement shall have
such meanings when used in the ATC Disclosure Schedule, the ATS Disclosure
Schedule and each Collateral Document executed pursuant hereto or thereto or
otherwise delivered pursuant hereto or thereto. References to "hereof," "herein"
or similar terms are intended to refer to the Agreement as a whole and not a
particular section, and references to "this Section" or "this Article" are
intended to refer to the entire section or article and not a particular
subsection thereof.
ARTICLE 2
THE MERGER
2.1 The Merger. Upon the terms and subject to the conditions set
forth in this Agreement, and in accordance with the Delaware General Corporation
Law (the "DCL"), ATC shall be merged with and into ATS. As a result of the
Merger, the separate corporate existence of ATC shall cease and ATS shall
continue as the surviving corporation in the Merger (sometimes referred to, as
such, as the "Surviving Corporation").
2.2 Closing. Unless this Agreement shall have been terminated
pursuant to Section 8.1 and subject to the satisfaction or, to the extent
permitted by Applicable Law, waiver of the conditions set forth in Article 7,
the closing of the Merger (the "Closing") will take place, at 10:00 a.m., on the
Closing Date, at the offices of ▇▇▇▇▇▇▇▇ & Worcester LLP, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, on the date on which the Tower Distribution
occurs (whether by reason of the CBS Merger or otherwise), unless another date,
time or place is agreed to in writing by the parties. The date on which the
Closing occurs is herein referred to as the "Closing Date."
2.3 Effective Time. Subject to the provisions of this Agreement, as
promptly as practicable after the Closing, the parties hereto shall cause the
Merger to be consummated by filing a Certificate of Merger in the form attached
hereto as Exhibit A and made a part hereof (the "Certificate of Merger") and any
related filings required under the DCL with the Secretary of State of the State
of Delaware. The Merger shall become effective at such time as such documents
are duly filed as aforesaid, or at such later time as is specified in such
documents (the "Effective Time").
2.4 Effect of the Merger. The Merger shall have the effects provided
for under the DCL.
2.5 Certificate of Incorporation. Subject to the consummation of the
Merger, ATS shall file with the Secretary of State of the State of Delaware an
Amended and Restated Certificate of Incorporation, in the form attached hereto
as Exhibit B-1 and made a part hereof (the "ATS Existing Restated Certificate"),
as amended to incorporate the principles set forth on Exhibit B-2 and made a
part hereof, which principles will be incorporated in an Amended and Restated
Certificate of Incorporation of ATS (the "ATS Restated Certificate") and which
principles will control over any provision in the Existing ATS Restated
Certificate, which shall be the Certificate of Incorporation of the Surviving
Corporation until thereafter changed or amended as provided therein or by
Applicable Law.
2.6 Bylaws. The bylaws of ATS in the form included as part of Section
2.5 of the ATS Disclosure Schedule modified to reflect the change of ATS' name
to "American Tower Corporation" shall be the bylaws of the Surviving Corporation
until amended in accordance with Applicable Law and the Organic Documents of
ATS.
2.7 Directors and Officers. From and after the Effective Time, until
successors are duly elected or appointed and qualified, or upon their earlier
resignation or removal, in accordance with Applicable Law and the Organic
Documents of ATS, (a) the directors of ATS at the Effective Time shall be the
directors of the Surviving Corporation and ▇▇▇▇. ▇. ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇▇▇▇, and
(b) the officers of ATS at the Effective Time shall be the officers of the
Surviving Corporation.
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ARTICLE 3
CONVERSION OF SHARES; EXCHANGE OF CERTIFICATES
3.1 Conversion of Capital Stock. At the Effective Time, by virtue of
the Merger and without any action on the part of ATS or ATC or their respective
stockholders:
(a) Each share of Common Stock, par value $.01 per share,
of ATS (the "ATS Common Stock") issued and outstanding immediately
prior to the Effective Time shall remain outstanding.
(b) Each share (each, an "ATC Share" and collectively the
"ATC Shares") of Class A Common Stock, par value $.01 per share, of
ATC and Class B Common Stock, par value $.01 per share, of ATC
(collectively for both such classes, the "ATC Common Stock") issued
and outstanding immediately prior to the Effective Time (other than
Dissenting Shares) shall, by virtue of the Merger and without any
action on the part of the holder thereof, be converted into the right
to receive the number of shares (the "Merger Consideration") of Class
A Common Stock, par value $.01 per share, of ATS (the "ATS Class A
Common Stock") obtained by dividing the Aggregate Merger Shares by the
number of shares of ATC Common Stock determined on a Fully-Diluted
Basis immediately prior to the Effective Time (the "Exchange Ratio").
The parties acknowledge that the Exchange Ratio has been determined to
give the ATC stockholders (assuming there are no Dissenting Shares) in
the aggregate shares of ATS Class A Common Stock representing 35% of
the Surviving Corporation's outstanding common stock determined on a
Fully-Diluted Basis.
(c) Each share of ATC Common Stock owned by ATS or any of
its Subsidiaries or ATC or any of its Subsidiaries immediately prior
to the Effective Time shall automatically be canceled and extinguished
without any conversion thereof and no payment shall be made with
respect thereto.
(d) Each share of Senior Preferred Stock, par value $.01
per share, of ATC (the "ATC Preferred Stock"), issued and outstanding
immediately prior to the Effective Time shall, by virtue of the Merger
and without any action on the part of the holder thereof, be converted
into the right to receive cash or other immediately available funds in
the amount of $200.00 (the "Preferred Stock Merger Consideration").
In the event either the Gearon Transaction or the ATS Private
Placement has not been consummated prior to the Effective Time, the parties
hereto will negotiate in good faith to determine the net effect, if any, of the
failure to so consummate either or both of the foregoing on the enterprise value
of ATS. If the parties agree that the net effect of the failure of either or
both of the Gearon Transaction and the ATS Private Placement to occur is a
reduction in the ATS enterprise value, the parties shall also determine an
appropriate adjustment of the number of Aggregate Merger Shares so that the
Aggregate Merger Shares, as adjusted, constitute a higher percentage to reflect
the relative enterprise values of ATS and ATC. The parties shall negotiate in
good faith for fifteen (15) days following the request by either party to do so.
Any mater not resolved within such fifteen (15)-day period shall be submitted to
a nationally recognized, independent investment banking firm selected by
agreement of the parties hereto. Within five (5) days after the selection of
such firm, ATC and ATS shall each submit to such firm and the other its
calculation of its proposed adjustment, together with its methodology. The
parties shall instruct such to render a final and binding decision by selecting
one of the two submitted adjustment proposals that more fairly represents, in
the opinion of such firm, the adjustment required by reason of the enterprise
reductions solely attributable to the items set forth above. The investment
banking firm shall not have any discretion to select an adjustment other than
one
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of the two proposed. The parties shall instruct such firm to render its decision
within fifteen (15) days after submission of the adjust. Each party shall
cooperate in all reasonable respects with such firm in making its determination.
The Termination Date shall be extended to allow for the foregoing discussions
for the later of the fifteen (15)-day period the parties negotiate in good faith
or, if they fail to reach agreement, for the period required by the investment
banking firm to render its decision.
At the Effective Time, all ATC Shares shall no longer be outstanding
and shall automatically be canceled and retired and shall cease to exist, and
certificates previously evidencing any such ATC Shares (each, a "Certificate")
shall thereafter represent the right to receive, upon the surrender of such
Certificate in accordance with the provisions of Section 3.2, the Merger
Consideration multiplied by the number of ATC Shares represented by such
Certificate, and a holder of more than one Certificate shall have the right to
receive the Merger Consideration multiplied by the number of ATC Shares
represented by all such Certificates, or, in the case of a holder of Dissenting
Shares, the right to perfect the right to receive payment for Dissenting Shares
pursuant to Section 262 of the DCL. In lieu of any such fractional shares, each
holder of ATC Common Stock who would otherwise have been entitled to receive a
fraction of a share of ATS Class A Common Stock, upon surrender of Certificates
for exchange pursuant to this Article, shall be entitled to receive a cash
payment equal to such fraction multiplied by the closing price per share of ATS
Class A Common Stock on the Nasdaq National Market ("Nasdaq") or, if not then
traded on Nasdaq, on the principal stock exchange on which the ATS Class A
Common Stock is admitted to trading, as reported by the Wall Street Journal, for
the first trading day immediately following the Effective Time, and the Merger
Consideration to which a holder is entitled shall be deemed to be such number of
shares of ATS Class A Common Stock and such cash. The holders of such
Certificates previously evidencing ATC Shares outstanding immediately prior to
the Effective Time shall cease to have any rights with respect to such ATC
Shares, except as otherwise provided herein or by Applicable Law.
At the Effective Time, all shares of ATC Preferred Stock shall no
longer be outstanding and shall automatically be canceled and retired and shall
cease to exist, and certificates previously evidencing any such shares shall
thereafter represent the right to receive, upon the surrender of certificates
representing such shares in accordance with the provisions of Section 3.2, the
Preferred Stock Merger Consideration multiplied by the number of shares of ATC
Preferred Stock represented by such certificate, and a holder of more than one
certificate shall have the right to receive the Preferred Stock Merger
Consideration multiplied by the number of ATC Preferred Stock represented by all
such certificates. The holders of such certificates previously evidencing shares
of ATC Preferred Stock outstanding immediately prior to the Effective Time shall
cease to have any rights with respect to such shares, except as otherwise
provided herein or by Applicable Law.
3.2 Surrender of Certificates; Payment of Merger Consideration and
Preferred Stock Merger Consideration. At and after the Effective Time, the
Surviving Corporation shall issue to each holder of ATC Common Stock, upon
surrender of each of his or its Certificates, a certificate of ATS Class A
Common Stock representing the Merger Consideration with respect to the ATC
Shares represented by such Certificate in accordance with the provisions of
Section 3.1, plus cash in amount sufficient to make payment for fractional
shares. In addition, the Surviving Corporation shall pay to each holder of ATC
Preferred Stock, upon surrender of his or its stock certificate evidencing
ownership of ATC Preferred Stock, in cash or immediately available funds by wire
transfer to an account or accounts designated by ATC to ATS at least two (2)
Business Days prior to the Closing, the sum of $200.00 multiplied by the number
of shares of ATC Preferred Stock evidenced by such certificate. In the event any
ATC stockholder has not delivered the certificate referred to in Section 6.28,
the Surviving Corporation shall be entitled to withhold from delivery
certificates for the ATS Class A Common Stock to which such stockholder would
otherwise be entitled, a number of shares of ATS
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Class A Common Stock required to enable the Surviving Corporation to comply with
the applicable provisions of the Code.
3.3 Stock Transfer Books. At the Effective Time, the stock transfer
books of ATC shall be closed, and there shall be no further transfer of shares
of ATC Common Stock or ATC Preferred Stock thereafter on the records of ATC. Any
Certificates representing ATC Shares or certificates representing shares of ATC
Preferred Stock presented after the Effective Time for transfer shall be
canceled and exchanged for the amount to which the ATC Shares or shares of ATC
Preferred Stock represented thereby shall be entitled pursuant to Sections 3.1
and 3.2.
3.4 Dissenting Shares.
(a) Notwithstanding any other provision of this Agreement
to the contrary, shares of ATC Common Stock that are outstanding
immediately prior to the Effective Time and which are held by ATC
stockholders who shall have not voted in favor of the Merger or
consented thereto in writing and who shall be entitled to and shall
have demanded properly in writing appraisal rights for such shares of
ATC Common Stock in accordance with Section 262 of the DCL and who
shall not have withdrawn such demand or otherwise have forfeited
appraisal rights (collectively, the "Dissenting Shares"), shall not be
converted into or represent the right to receive the Merger
Consideration payable in respect of each share of ATC Common Stock
represented thereby. Such ATC stockholders shall be entitled to
receive payment of the appraised value of such shares of ATC Common
Stock held by them in accordance with the provisions of the DCL;
provided, however, that all Dissenting Shares held by ATC stockholders
who shall have failed to perfect or who effectively shall have
withdrawn, forfeited or lost their appraisal rights with respect to
such shares of ATC Common Stock under the DCL shall thereupon be
deemed to have been converted into and to have become exchangeable
for, as of the Effective Time, the right to receive, without any
interest thereon, the Merger Consideration upon surrender, in the
manner provided in Section 3.2, of the Certificates with respect to
such shares.
(b) ATC shall give ATS prompt notice of any demands for
appraisal rights received by it, withdrawals of such demands, and any
other instruments served pursuant to the DCL and received by ATC and
relating thereto. ATC shall give ATS the opportunity to direct all
negotiations and proceedings with respect to demands for appraisal
rights under the provisions of the DCL. ATC shall not, except with the
prior written consent of ATS, make any payment with respect to any
demands for appraisal rights, or offer to settle, or settle, any such
demands.
3.5 Option Securities and Convertible Securities; Payment Rights. At
the Effective Time, subject to the provisions of Section 6.10, each outstanding
Option Security and each Convertible Security of ATC, if any, whether or not
then exercisable for or convertible into ATC Shares or other ATC securities,
outstanding immediately prior to the Effective Time, shall be canceled and
retired and shall cease to exist, and the holder thereof shall not be entitled
to receive any consideration therefor.
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ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF ATC
ATC hereby represents and warrants to ATS as follows (it being
understood and agreed by the parties that, except as the context otherwise
requires, the representations and warranties of ATC set forth in this Article
shall apply to each of its Subsidiaries with the same force and effect as though
each of them were named in each Section hereof):
4.1 Organization and Business; Power and Authority; Effect of
Transaction.
(a) ATC is a corporation duly organized, validly existing
and in good standing under the laws of its jurisdiction of
organization, has all requisite power and authority (corporate and
other) to own or hold under lease its properties and to conduct its
business as now conducted and is duly qualified and in good standing
as a foreign corporation in each other jurisdiction (as shown on
Section 4.1(a) of the ATC Disclosure Schedule) in which the character
of the property owned or leased by it or the nature of its business or
operations requires such qualification, except for such qualifications
the failure of which to obtain, individually or in the aggregate,
would not have a Material Adverse Effect on ATC.
(b) ATC has all requisite power and authority (corporate
and other) and has in full force and effect all Governmental
Authorizations and Private Authorizations necessary to enable it to
execute and deliver, and to perform its obligations under, this
Agreement and each Collateral Document executed or required to be
executed by it pursuant hereto or thereto and to consummate the
Transactions to which ATC is a party; and the execution, delivery and
performance of this Agreement and each Collateral Document executed or
required to be executed by it pursuant hereto or thereto have been
duly authorized by all requisite corporate or other action on the part
of ATC, other than the approval of the stockholders of ATC, and no
other corporate proceedings on the part of ATC are necessary to
authorize this Agreement or the transactions contemplated hereby or to
consummate the Merger or the other transactions so contemplated (other
than, with respect to the Merger, the ATC Required Vote). This
Agreement has been duly executed and delivered by ATC and constitutes,
and each Collateral Document executed or required to be executed by it
pursuant hereto or thereto or to consummate the Transactions when
executed and delivered by ATC will constitute, legal, valid and
binding obligations of ATC, enforceable in accordance with their
respective terms, except as such enforceability may be subject to
bankruptcy, moratorium, insolvency, reorganization, arrangement,
voidable preference, fraudulent conveyance and other similar laws
relating to or affecting the rights of creditors and except as the
same may be subject to the effect of general principles of equity. The
provisions of Section 203 of the DCL will not apply to ATC by reason
of this Agreement or the Merger. As of the date hereof, the Board of
Directors of ATC, at a meeting duly called and held at which a quorum
was present throughout, has approved the Merger and this Agreement,
and has recommended that the ATC stockholders approve and adopt this
Agreement and the transactions contemplated hereby, including without
limitation the Merger and the ATC Voting Agreement and the acquisition
by ATS of the "beneficial" ownership contemplated thereby.
(c) Except as set forth in Section 4.1(c) of the ATC
Disclosure Schedule, neither the execution and delivery by ATC of this
Agreement or any Collateral Document executed or required to be
executed by it pursuant hereto or thereto, nor the consummation of the
Transactions by ATC, nor compliance with the terms, conditions and
provisions hereof or thereof by ATC:
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(i) will conflict with, or result in a breach
or violation of, or constitute a default under, any Organic
Document of ATC or any Applicable Law, or will conflict
with, or result in a breach or violation of, or constitute a
default under, or permit the acceleration of any obligation
or liability in, or but for any requirement of giving of
notice or passage of time or both would constitute such a
conflict with, breach or violation of, or default under, or
permit any such acceleration in, any Material Agreement of
ATC; or
(ii) will require ATC to make or obtain any
Governmental Authorization, Governmental Filing or Private
Authorization including without limitation under the FCA,
except as required by the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Act and other
than any of the foregoing that have been obtained.
(d) Except as set forth in Section 4.1(d) of the ATC
Disclosure Schedule, ATC does not have any Subsidiaries, each of which
is (i) wholly-owned unless noted otherwise in Section 4.1(d) of the
ATC Disclosure Schedule, (ii) a corporation which is duly organized,
validly existing and in good standing under the laws of the respective
state of incorporation set forth opposite its name on Section 4.1(d)
of the ATC Disclosure Schedule, and (iii) duly qualified and in good
standing as a foreign corporation in each other jurisdiction (as shown
on Section 4.1(d) of the ATC Disclosure Schedule) in which the
character of the property owned or leased by it or the nature of its
business or operations requires such qualification, with full power
and authority (corporate and other) to carry on the business in which
it is engaged, except for such qualifications the failure of which to
obtain, individually or in the aggregate, would not have a Material
Adverse Effect on ATC. ATC owns, directly or indirectly, all of the
outstanding capital stock and equity interests (as shown in Section
4.1(d) of the ATC Disclosure Schedule) of each Subsidiary, free and
clear of all Liens (except for Permitted Liens or except as described
in the notes to the ATC Financial Statements or set forth in Section
4.1(d) of the ATC Disclosure Schedule), and all such stock or other
equity interests has been duly authorized and validly issued and is
fully paid and nonassessable. There are no outstanding Option
Securities or Convertible Securities, or agreements or understandings
of any nature whatsoever, relating to the authorized and unissued or
outstanding capital stock or equity interests of any Subsidiary of
ATC.
4.2 Financial and Other Information. The financial statements of ATC,
furnished by ATC, and included in the ATS Information Statement (the "ATC
Financial Statements"), including in each case the notes thereto, have been
prepared in accordance with GAAP applied on a consistent basis throughout the
periods covered thereby, except as otherwise noted therein or as set forth in
Section 4.2 of the ATC Disclosure Schedule, and fairly present in all material
respects the financial condition and the results of operations and cash flow of
ATC, on the bases therein stated, as of the respective dates thereof, and for
the respective periods covered thereby subject, in the case of unaudited
financial statements, to normal nonmaterial year-end audit adjustments and
accruals.
4.3 Material Statements and Omissions; Absence of Events. Neither any
representation or warranty made by ATC contained in this Agreement or any
certificate, document or other instrument or other information furnished or to
be furnished by ATC pursuant to the provisions hereof (including without
limitation information with respect to ATC furnished for inclusion in the ATS
Prospectus and the ATS Registration Statement) nor the ATC Disclosure Schedule
or the ATC Business Description contains or will contain any untrue statement of
a material fact or omits or will omit to state any material fact required to
make any statement contained herein or therein, in light of the circumstances
under which they were made, not
-7-
misleading; provided, however, that to the extent that any such information
contains any financial projections, ATC represents and warrants only that such
projections have been prepared in good faith on the basis of the ATC Financial
Statements and other information and assumptions which ATC believes to be
reasonable. Since the date of the most recent financial statements constituting
a part of the ATC Financial Statements, except to the extent specifically
described in Section 4.3 of the ATC Disclosure Schedule, there has been no
change in ATC which has had a Material Adverse Effect on ATC. There is no Event
known to ATC which has had, or (so far as ATC can now reasonably foresee) is
likely to have, a Material Adverse Effect on ATC, except to the extent
specifically described in Section 4.3 of the ATC Disclosure Schedule and except
for matters affecting the tower rental, ownership and construction industry
generally, including without limitation competition, regulation and resources or
events arising out of the execution or public announcement of this Agreement.
4.4 Title to Properties; Leases.
(a) ATC has, to ATC's knowledge, good and indefeasible
title to all of its real property (other than leasehold real property)
and good title to all of its other assets (other than real property),
tangible and intangible (the "ATC Assets"); all of such real property
and other assets are so owned, in each case, free and clear of all
Liens, except (i) Permitted Liens, and (ii) Liens described in the
notes to the ATC Financial Statements or set forth on Section 4.4(a)
of the ATC Disclosure Schedule. Except for financing statements
evidencing Liens referred to in the preceding sentence, no financing
statements under the Uniform Commercial Code and no other filing which
names ATC as debtor or which covers or purports to cover any of the
ATC Assets is on file in any state or other jurisdiction, and ATC has
not signed or agreed to sign any such financing statement or filing or
any agreement authorizing any secured party thereunder to file any
such financing statement or filing. Except as disclosed in Section
4.4(a) of the ATC Disclosure Schedule, all improvements on the real
property owned or leased by ATC are, to ATC's knowledge, in compliance
with applicable zoning, wetlands and land use laws, ordinances and
regulations and applicable title covenants, conditions, restrictions
and reservations in all respects necessary to conduct the operations
as presently conducted, except for any instances of non-compliance
which do not and will not in the aggregate have a Material Adverse
Effect on ATC. Except as described in the notes to the ATC Financial
Statements or disclosed in Section 4.4(a) of the ATC Disclosure
Statement, all such improvements comply with all Applicable Laws, ATC
Governmental Authorizations and ATC Private Authorizations, except
where noncompliance is not reasonably likely to have a Material
Adverse Effect on ATC. There is no pending or, to ATC's knowledge,
threatened or contemplated action to take by eminent domain or
otherwise to condemn any part of any real property constituting a
material portion of the real property owned by ATC or, to ATC's
knowledge, any real property leased by ATC. Except as described in the
notes to the ATC Financial Statements or set forth in Section 4.4(a)
of the ATC Disclosure Schedule, such real property (other than land),
fixtures, fixed assets and other material items of personal property,
including equipment, have, in ATC's reasonable business judgment, been
maintained in a manner consistent with customary industry practices
and currently permit the business of ATC (the "ATC Business") to be
operated in all material respects in accordance with the terms and
conditions of all Applicable Laws, ATC Governmental Authorizations and
ATC Private Authorizations.
(b) Each Lease or other occupancy or other agreement under
which ATC holds real or personal property constituting a part of the
ATC Assets has been duly authorized, executed and delivered by or
assigned to ATC and, to ATC's knowledge, each of the other parties
thereto, and is a legal, valid and binding obligation of ATC, and, to
ATC's knowledge, each of the other parties thereto, enforceable in
accordance with its terms, except as such enforceability may be
limited by
-8-
bankruptcy, moratorium, insolvency and similar laws affecting the
rights and remedies of creditors and obligations of debtors generally
and by general principles of equity , and except for such exceptions
to the foregoing as, individually or in the aggregate, have not had
and will not have any Material Adverse Effect on ATC. ATC has a valid
leasehold interest in and enjoys peaceful and undisturbed possession
under all Leases pursuant to which it holds any such real property or
tangible personal property, subject to the terms of each such Lease
and Applicable Law and except for such exceptions to the foregoing as,
individually or in the aggregate, have not had and will not have any
Material Adverse Effect on ATC. All of such Leases are valid and
subsisting and in full force and effect, and neither ATC nor, to ATC's
knowledge, any other party thereto, is in material default in the
performance, observance or fulfillment of any obligation, covenant or
condition contained in any such Lease, except for such exceptions to
the foregoing as, individually or in the aggregate, have not had and
will not have any Material Adverse Effect on ATC.
4.5 Compliance with Private Authorizations. ATC has obtained all
Private Authorizations (collectively, the "ATC Private Authorizations") which
are necessary for the ownership or operation of the ATC Assets or the conduct of
the ATC Business which, if not obtained and maintained, could, individually or
in the aggregate, be reasonably likely to have a Material Adverse Effect on ATC.
All of the ATC Private Authorizations are valid and in good standing and are in
full force and effect, except for such exceptions as are not reasonably likely
to have a Material Adverse Effect on ATC. ATC is not in breach or violation of,
or in default in the performance, observance or fulfillment of, any ATC Private
Authorization, and no Event exists or has occurred, which constitutes, or but
for any requirement of giving of notice or passage of time or both would
constitute, such a breach, violation or default, under any ATC Private
Authorization, except for such defaults, breaches or violations as do not and
are not reasonably likely to have in the aggregate a Material Adverse Effect on
ATC. No ATC Private Authorization is the subject of any pending or, to ATC's
knowledge, threatened attack, revocation or termination, except for such
exceptions as are not reasonably likely to have a Material Adverse Effect on
ATC.
4.6 Compliance with Governmental Authorizations and Applicable Law.
(a) ATC has obtained all Governmental Authorizations
(collectively, the "ATC Governmental Authorizations") which are
necessary for the ownership or operation of the ATC Assets or the
conduct of the ATC Business as now conducted and which, if not
obtained and maintained, would, individually or in the aggregate, have
any Material Adverse Effect on ATC. None of the ATC Governmental
Authorizations is subject to any restriction or condition which would
limit in a material respect the ownership or operations of the ATC
Assets or the conduct of the ATC Business as currently conducted,
except for restrictions and conditions generally applicable to ATC
Governmental Authorizations of such type. The ATC Governmental
Authorizations are valid and in good standing, are in full force and
effect and are not impaired by any act or omission of ATC or its
officers, directors, employees or agents, and the ownership or
operation of the ATC Assets or the conduct of the ATC Business are in
accordance with the ATC Governmental Authorizations, except for such
exceptions to the foregoing as, individually or in the aggregate, have
not had and will not have any Material Adverse Effect on ATC. All
material reports, forms and statements required to be filed by ATC
with all Authorities with respect to the ATC Business have been filed
and are true, complete and accurate in all material respects. No ATC
Governmental Authorization is the subject of any pending or, to ATC's
knowledge, threatened challenge or proceeding to revoke or terminate
any ATC Governmental Authorization which, if revoked or terminated,
would have a Material Adverse Effect on ATC.
-9-
(b) ATC is in compliance with all Applicable Laws, except
where such noncompliance, individually or in the aggregate, has not
had and is not reasonably like to have a Material Adverse Effect on
ATC. Except as set forth in Section 4.6(b) of the ATC Disclosure
Schedule, there are no Legal Actions of any kind pending or, to the
knowledge of ATC, threatened at law, in equity or before any Authority
against ATC.
4.7 Intangible Assets. Except as set forth in Section 4.7 of the ATC
Disclosure Schedule, no Intangible Assets (except ATC Governmental
Authorizations and ATC Private Authorizations) are required for the ownership or
operation of the ATC Assets or the conduct of the ATC Business as currently
owned, operated and conducted, except for such exceptions to the foregoing as,
individually or in the aggregate, have not had and will not have any Material
Adverse Effect on ATC. ATC does not, to its knowledge, wrongfully infringe upon
or unlawfully use any Intangible Assets owned or claimed by another, and ATC has
not received any notice of any claim or infringement relating to any such
Intangible Asset, except from ATS and except for such exceptions to the
foregoing as, individually or in the aggregate, have not had and will not have
any Material Adverse Effect on ATC.
4.8 Related Transactions. ATC is not a party or subject to any
Contractual Obligation relating to the ownership or operation of the ATC Assets
or the conduct of the ATC Business between ATC and any of its officers,
directors or stockholders or, to the knowledge of ATC, any Affiliate of any
thereof, including without limitation any Contractual Obligation providing for
the furnishing of services to or by, providing for rental of property, real,
personal or mixed, to or from, or providing for the lending or borrowing of
money to or from or otherwise requiring payments to or from, any such Person,
other than (i) Employment Arrangements listed or described in Section 4.14 of
the ATC Disclosure Schedule, (ii) Contractual Obligations between ATC and any of
its directors, stockholders or officers or any Affiliate of any of the
foregoing, which will be terminated, at no cost or expense to ATC, prior to the
Closing, (iii) as specifically set forth in Section 4.8 of the ATC Disclosure
Schedule, or (iv) transactions related to payments that are a part of the $5.0
million allowance described in Section 6.0(a)(iv)(A).
4.9 Insurance. ATC maintains, with respect to the ATC Assets and the
ATC Business, policies of fire and extended coverage and casualty, liability and
other forms of insurance in such amounts and against such risks and losses as
are customary for companies engaged in similar businesses.
4.10 Tax Matters.
(a) ATC has in accordance with all Applicable Laws filed
all Tax Returns which are required to be filed, and has paid, or made
adequate provision for the payment of, all Taxes which have become due
and payable pursuant to said Tax Returns and all other governmental
charges and assessments received to date other than those Taxes being
contested in good faith for which adequate provision has been made on
the most recent balance sheet forming part of ATC Financial
Statements. The Tax Returns of ATC have been prepared in all material
respects in accordance with all Applicable Laws. All Taxes which ATC
is required by law to withhold and collect have been duly withheld and
collected, and have been paid over, in a timely manner, to the proper
Authorities to the extent due and payable. ATC has not executed any
waiver to extend, or otherwise taken or failed to take any action that
would have the effect of extending, the applicable statute of
limitations in respect of any Tax liabilities of ATC for the fiscal
years prior to and including the most recent fiscal year. ATC is not a
"consenting corporation" within the meaning of Section 341(f) of the
Code. ATC has at all times been taxable as a Subchapter C corporation
under the Code, and has never been a member of any
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consolidated group for Tax purposes, except as otherwise set forth in
Section 4.10(a) of the ATC Disclosure Schedule.
(b) Federal and state income Tax Returns of ATC have not
been examined by the IRS or applicable state Authority, and ATC has
not been notified of any proposed examination, except as shown in
Section 4.10(b) of the ATC Disclosure Schedule.
(c) ATC is not a party to any tax sharing agreement or
arrangement with any other Person.
(d) All of the ATC stockholders are "U.S. persons" within
the meaning of Section 7701(a)(30) of the Code. 4.11 Employee
Retirement Income Security Act of 1974.
(a) ATC (which for purposes of this Section shall include
any ERISA Affiliate of ATC) currently sponsors, maintains and
contributes only to the Plans and Benefit Arrangements set forth in
Section 4.11(a) of the ATC Disclosure Schedule. ATC has delivered or
made available to ATS true, complete and correct copies of (i) each
Plan and Benefit Arrangement (or, in the case of any unwritten Plans
or Benefit Arrangements, reasonable descriptions thereof), (ii) the
two most recent annual reports on Form 5500 (including all schedules
and attachments thereto) filed with the Internal Revenue Service with
respect to each Plan (if any such report was required by Applicable
Law), (iii) the most recent summary plan description (or similar
document) for each Plan for which such a summary plan description is
required by Applicable Law or was otherwise provided to plan
participants or beneficiaries, and (iv) each trust agreement and
insurance or annuity contract or other funding or financing
arrangement relating to any Plan. To the knowledge of ATC, each such
Form 5500 and each such summary plan description (or similar document)
does not, as of the date hereof, contain any material misstatements.
ATC does not contribute to or have an obligation to contribute to, and
has not at any time within six (6) years prior to the date of this
Agreement contributed to or had an obligation to contribute to, and no
Plan listed in Section 4.11(a) of the ATC Disclosure Schedule is, (i)
an employee pension benefit plan within the meaning of Section 3(2) of
ERISA, (ii) a Multiemployer Plan, or (iii) a Plan subject to Section
412 of the Code, Section 302 of ERISA or Title IV of ERISA. ATC has no
actual or potential liability under Title IV of ERISA. ATC does not
maintain any Plan that provides for post-retirement medical or life
insurance benefits, and ATC does not have any obligation or liability
with respect to any such Plan previously maintained by ATC, except as
the provisions of COBRA may apply to any former employees of ATC.
Except as set forth in Section 4.11(a) of the ATC Disclosure Schedule,
as to all Plans and Benefit Arrangements listed in Section 4.11(a) of
the ATC Disclosure Schedule:
(i) all such Plans and Benefit Arrangements
comply and have been administered in form and in operation
in accordance with their respective terms, and with all
Applicable Laws, in all material respects, and ATC has not
received any notice from any Authority disputing or
investigating such compliance;
(ii) none of the assets of any such Plan are
invested in employer securities or employer real property;
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(iii) there are no Claims (other than routine
Claims for benefits or actions seeking qualified domestic
relations orders) pending or, to ATC's knowledge, threatened
involving such Plans or the assets of such Plans, and, to
ATC's knowledge, no facts exist which are reasonably likely
to give rise to any such Claims (other than routine Claims
for benefits or actions seeking qualified domestic relations
orders);
(iv) all material contributions to, and
material payments from, the Plans and Benefit Arrangements
that may have been required to be made in accordance with
the terms of the Plans and Benefit Arrangements, and any
applicable collective bargaining agreement, have been made.
All such contributions to, and payments from, the Plans and
Benefit Arrangements, except those payments to be made from
a trust qualified under Section 401(a) of the Code, for any
period ending before the Closing Date that are not yet, but
will be, required to be made, will be properly accrued and
reflected on the financial books and records of ATC;
(v) No act, omission or transaction has
occurred which would result in imposition on ATC of (A) any
breach of fiduciary duty liability damages under Section 409
of ERISA, (B) a civil penalty assessed pursuant to
subsections (c), (i) or (l) of Section 502 of ERISA or (C) a
tax imposed pursuant to Chapter 43 of Subtitle D of the
Code;
(vi) ATC has not incurred any material
liability to a Plan (other than for contributions not yet
due) which liability has not been fully paid or accrued for
payment as of the date hereof;
(vii) except as otherwise contemplated by this
Agreement or the ATC Disclosure Schedule, no current or
former employee of ATC will be entitled to any additional
benefits or any acceleration of the time of payment or
vesting of any benefits under any Plan or Benefit
Arrangement as a result of the transactions contemplated by
this Agreement;
(viii) no compensation payable by ATC to any of
its employees under any existing Plan, Benefit Arrangement
(including by reason of the transactions contemplated
hereby) will be subject to disallowance under Section 162(m)
of the Code;
(ix) any amount that could be received (whether
in cash or property or the vesting of property) as a result
of any of the transactions contemplated by this Agreement by
any employee, officer, director or independent contractor of
ATC who is a "disqualified individual" (as such term is
defined in proposed Treasury Regulation Section 1.280G-1)
under any employment arrangement would not be characterized
as an "excess parachute payment" (as such term is defined in
Section 280G(b)(1) of the Code), except for any amount that
is approved by the stockholders of ATC on or before the
Closing Date in the manner provided in Section 280G(b)(5) of
the Code; and
(x) there are no outstanding options (or
contractual obligations to issue options) to acquire ATC
Common Stock or other ATC securities other than options held
by employees or directors of ATC and issued under Benefit
Arrangements (the aggregate number of which are as set forth
in Section 4.11(a) of the ATC Disclosure Schedule).
-12-
(b) The execution, delivery and performance by ATC of this
Agreement and the Collateral Documents executed or required to be
executed by ATC pursuant hereto and thereto will not involve any
prohibited transaction within the meaning of ERISA or Section 4975 of
the Code with respect to any Plan listed in Section 4.11(a) of the ATC
Disclosure Schedule.
4.12 Absence of Sensitive Payments. Neither ATC nor, to ATC's
knowledge, any of its officers, directors, employees, agents or other
representatives, has with respect to the ATC Assets or the ATC Business (a) made
any contributions, payments or gifts to or for the private use of any
governmental official, employee or agent where either the payment or the purpose
of such contribution, payment or gift is illegal under the laws of the United
States or the jurisdiction in which made or (b) established or maintained any
unrecorded fund or asset for any illegal purpose or made any false or artificial
entries on its books.
4.13 Bank Accounts, Etc. Section 4.13 of the ATC Disclosure Schedule
contains a true, accurate and complete list as of the date hereof of all banks,
trust companies, savings and loan associations and brokerage firms in which ATC
has an account or a safe deposit box and the names of all Persons authorized to
draw thereon, to have access thereto, or to authorize transactions therein, the
names of all Persons, if any, holding valid and subsisting powers of attorney
from ATC and a summary statement as to the terms thereof.
4.14 Employment Arrangements. Section 4.14 of the ATC Disclosure
Schedule contains a true, accurate and complete list of all employees of ATC and
its Subsidiaries as of the date of this Agreement (the "ATC Employees"),
together with each such employee's title or the capacity in which he or she is
employed and each such employee's compensation. ATC has no obligation or
liability, contingent or other, under any Employment Arrangement with any ATC
Employee, other than (i) those listed or described in Section 4.11(a) or Section
4.14 of the ATC Disclosure Schedule, (ii) those incurred in the ordinary and
usual course of business, or (iii) such obligations or liabilities as do not and
will not have, in the aggregate, any Material Adverse Effect on ATC. Except as
described in Section 4.14 of the ATC Disclosure Schedule, (a) none of the ATC
Employees is now, or since January 1, 1995 has been, represented by any labor
union or other employee collective bargaining organization, and ATC is not, and
never has been, a party to any labor or other collective bargaining agreement
with respect to any of the ATC Employees, (b) there are no pending grievances,
disputes or controversies with any union or any other employee or collective
bargaining organization of such employees, or threats of strikes, work stoppages
or slowdowns or any pending demands for collective bargaining by any such union
or other organization, (c) neither ATC nor any of such employees is now, or
since January 1, 1995 has been, subject to or involved in or, to ATC's
knowledge, threatened with, any union elections, petitions therefor or other
organizational or recruiting activities, in each case with respect to the ATC
Employees, and (d) none of the ATC Employees has notified ATC that he or she
does not intend to continue employment with ATC until the Closing or with ATS
following the Closing. ATC has performed in all material respects all
obligations required to be performed under all Employment Arrangements of ATC
and is not in material breach or violation of or in material default or arrears
under any of the terms, provisions or conditions thereof.
4.15 Material Agreements. Listed on Section 4.15 of the ATC
Disclosure Schedule are all Material Agreements relating to the ownership or
operation of the ATC Assets or the conduct of the ATC Business or to which ATC
is a party or to which it is bound or which any of the ATC Assets is subject.
True, accurate and complete copies of each of such Material Agreements have been
made available by ATC to ATS. All of such Material Agreements are valid, binding
and legally enforceable obligations of ATC, except as such enforceability may be
limited by bankruptcy, moratorium, insolvency and similar laws affecting the
rights and remedies of creditors and obligations of debtors generally and by
general principles of equity. ATC has complied with all of the material terms
and conditions of each such Material Agreement and has not done or
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performed, or failed to do or perform (and there is no pending or, to the
knowledge of ATC, threatened in writing Claim with which ATC has not so
complied, done and performed or failed to do and perform) any act which would
invalidate or provide grounds for the other party thereto to terminate (with or
without notice, passage of time or both) such Material Agreement or impair the
rights or benefits, or increase the costs, of ATC under any of such Material
Agreements, except for such noncompliances, acts or omissions that, individually
or in the aggregate, have not had and will not have a Material Adverse Effect on
ATC. Without limiting the generality of the foregoing, Section 4.15 of the ATC
Disclosure Schedule sets forth a true, correct and complete description of all
material acquisitions pending or which are actively being negotiated and the
current status of all such acquisitions, except for those which ATC cannot
disclose due to its obligations to maintain the same in confidence, none of
which, if consummated on the terms and conditions currently being negotiated,
will have a Material Adverse Effect on ATC.
4.16 Ordinary Course of Business. Since September 30, 1997, except
(i) as may be described on Section 4.16 of the ATC Disclosure Schedule, or (ii)
as may be required or expressly permitted or contemplated by the terms of this
Agreement, ATC:
(a) has operated its business in all material respects in
the normal, usual and customary manner in the ordinary and regular
course of business, consistent with past practice, it being understood
that the acquisition and financing of communications sites and related
assets and other business involved in the communications sites
industry and the construction of communications towers and related
assets is part of the ordinary course of business of ATC;
(b) except in each case in the ordinary course of business,
consistent with past practice, it being understood that the
acquisition and financing of communications sites and related assets
and other business involved in the communications sites industry and
the construction of communications towers and related assets is part
of the ordinary course of business of ATC:
(i) has not incurred any obligation or
liability (fixed, contingent or other) individually having a
value in excess of $100,000;
(ii) has not sold or otherwise disposed of or
contracted to sell or otherwise dispose of any of its
properties or assets having a value in excess of $100,000;
(iii) has not entered into any individual
commitment having a value in excess of $100,000; and
(iv) has not canceled any debts or claims;
(c) has not created or permitted to be created any Lien on
any of its property, except for Permitted Liens;
(d) has not made or committed to make any additions to its
property or any purchases of equipment, except in the ordinary course
of business consistent with past practice or for normal maintenance
and replacements;
(e) except in the ordinary course of business consistent
with past practice, has not increased the compensation payable or to
become payable to any of the ATC Employees or otherwise materially
altered, modified or changed the terms of their employment;
-14-
(f) has not suffered any damage, destruction or loss
(whether or not covered by insurance) or any acquisition or taking of
property by any Authority that has had or is reasonably likely to have
a Material Adverse Effect on ATC;
(g) has not waived any rights of material value without
fair and adequate consideration;
(h) has not experienced any work stoppage;
(i) except in the ordinary course of business, has not
entered into, amended or terminated any Lease, Governmental
Authorization, Private Authorization, Material Agreement or Employment
Arrangement, or any transaction, agreement or arrangement with any
Affiliate of ATC; and
(j) has not made, paid or declared any Distribution.
4.17 Material and Adverse Restrictions. ATC is not a party to or
subject to, nor is any of the ATC Assets subject to, any Applicable Law,
Governmental Authorization, Contractual Obligation, Employment Arrangement,
Material Agreement or Private Authorization, or any other obligation or
restriction of any kind or character, which now has or, as far as ATC can now
reasonably foresee, at any time in the future, individually or in the aggregate,
is likely to have, any Material Adverse Effect on ATC, except as set forth in
Section 4.17 of the ATC Disclosure Schedule and except for matters affecting the
tower rental and construction industry generally.
4.18 Broker or Finder. No Person assisted in or brought about the
negotiation of this Agreement or the Merger in the capacity of broker, agent or
finder or in any similar capacity on behalf of ATC or, to the knowledge of ATC,
any of the ATC stockholders which, in any case, will result in liability to the
Surviving Corporation which was not reflected in the financial information
heretofore furnished by ATC to ATS.
4.19 Solvency. As of the execution and delivery of this Agreement,
ATC is, and immediately prior to the consummation of the Merger will be,
Solvent.
4.20 Environmental Matters. Except as set forth in Section 4.20 of
the ATC Disclosure Schedule, with respect to the ATC Assets and the ATC
Business, ATC:
(a) has not been notified that it is potentially liable
under, has not received any request for information or other
correspondence concerning its potential liability with respect to any
site or facility under, and, to ATC's knowledge, is not a "potentially
responsible party" under, the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended, the Resource
Conservation Recovery Act, as amended, or any similar state law;
(b) has not entered into or received any consent decree,
compliance order or administrative order issued pursuant to any
Environmental Law;
(c) is not a party in interest or in default under any
judgment, order, writ, injunction or decree of any Final Order issued
pursuant to any Environmental Law;
(d) has obtained all Environmental Permits required under
Environmental Laws, and has filed all applications, notices and other
documents required to be filed prior to the date of this
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Agreement to effect the timely renewal or issuance of all
Environmental Permits for the continued conduct of its business in the
manner now conducted;
(e) is in compliance in all material respects with all
Environmental Laws, and is not the subject of or, to ATC's knowledge,
threatened with any Legal Action involving a demand for damages or
other potential liability, including any Lien, with respect to
violations or breaches of any Environmental Law;
(f) has provided ATS with copies of all environmental site
assessments, audits or other investigatory reports in its possession
that pertain to any property currently owned, leased, operated or
occupied by ATC;
(g) has not installed or used any above ground or
underground storage tanks, friable asbestos, polychlorinated biphenyls
or urea formaldehyde foam insulation on any property currently owned,
leased or operated by ATC and, to ATC's knowledge, there are no above
ground or underground storage tanks, friable asbestos, polychlorinated
biphenyls or urea formaldehyde foam insulation or any property
currently owned, leased or operated by ATC;
(h) has not disposed of, released, spilled or buried any
Hazardous Materials (nor has any Person acting on its behalf done so)
in violation of Environmental Laws on any property or facility owned,
leased, operated or occupied by ATC or to ATC's knowledge at any
facility or site to which Hazardous Materials from or generated by ATC
may have been taken at any time in the past;
(i) has no knowledge of any disposal, release, spill or
burial of any Hazardous Materials by ATC (or any Person acting on its
behalf) on any property which could reasonably be expected to result
or has resulted in contamination which requires investigation,
remediation or other response activity on or beneath any properties or
facilities currently owned, leased, operated or occupied by ATC; and
(j) has no knowledge of any past or present Event related
to ATC's properties, operations or business, which Event, individually
or in the aggregate, could reasonably be expected to interfere with or
prevent continued material compliance with all Environmental Laws
applicable to the conduct of ATC's business in the manner now
conducted, or which, individually or in the aggregate, could
reasonably be expected to form the basis of any material Claim against
ATC in connection with the release or threatened release into the
environment of any Hazardous Material.
4.21 Capital Stock. The authorized and outstanding capital stock of
ATC is as set forth in Section 4.21 of the ATC Disclosure Schedule. All of such
outstanding capital stock has been duly authorized and validly issued, is fully
paid and nonassessable and is owned of record and, to ATC's knowledge,
beneficially as shown in Section 4.21 of the ATC Disclosure Schedule. Except as
described in Section 4.21 of the ATC Disclosure Schedule, ATC has not granted or
issued, nor has ATC agreed to grant or issue, any shares of its capital stock or
any Option Security or Convertible Security, and ATC is not a party to or bound
by any agreement, put or commitment pursuant to which it is obligated to
purchase, redeem or otherwise acquire any shares of capital stock or any Option
Security or Convertible Security. The affirmative vote of the holders of a
majority of the shares of ATC Common Stock (the "ATC Required Vote") is the only
unobtained vote necessary to approve and adopt this Agreement and the
transactions contemplated by this Agreement. As of the date of this Agreement,
[e] votes constituted a majority of the outstanding voting power of the ATC
Common Stock.
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4.22 State Takeover Statutes. To ATC's knowledge, no state takeover
Law, statute or similar statute or regulation applies or purports to apply to
the Merger, this Agreement or any of the transactions contemplated by this
Agreement.
ARTICLE 5
REPRESENTATIONS AND WARRANTIES OF ATS
ATS hereby represents and warrants to ATC as follows (it being
understood and agreed by the parties that, except as the context otherwise
requires, the representations and warranties of ATS set forth in this Article
shall apply to each of its Subsidiaries with the same force and effect as though
each of them were named in each Section hereof):
5.1 Organization and Business; Power and Authority; Effect of
Transaction.
(a) ATS is a corporation duly organized, validly existing
and in good standing under the laws of its jurisdiction of
organization, has all requisite power and authority (corporate and
other) to own or hold under lease its properties and to conduct its
business as now conducted and is duly qualified and in good standing
as a foreign corporation in each other jurisdiction in which the
character of the property owned or leased by it or the nature of its
business or operations requires such qualification, except for such
qualifications the failure of which to obtain, individually or in the
aggregate, would not have a Material Adverse Effect on ATS.
(b) ATS has all requisite power and authority (corporate
and other) and has in full force and effect all Governmental
Authorizations and Private Authorizations necessary to enable it to
execute and deliver, and to perform its obligations under, this
Agreement and each Collateral Document executed or required to be
executed by it pursuant hereto or thereto and to consummate the
Transactions to which ATS is a party; and the execution, delivery and
performance of this Agreement and each Collateral Document executed or
required to be executed by it pursuant hereto or thereto have been
duly authorized by all requisite corporate or other action on the part
of ATS, including without limitation by the requisite approval of ARS,
as the sole stockholder of ATS, and no other corporate proceedings on
the part of ATS are necessary to authorize this Agreement or the
transactions contemplated hereby or to consummate the Merger or the
other transactions so contemplated. This Agreement has been duly
executed and delivered by ATS and constitutes, and each Collateral
Document executed or required to be executed by it pursuant hereto or
thereto or to consummate the Transactions when executed and delivered
by ATS will constitute, legal, valid and binding obligations of ATS,
enforceable in accordance with their respective terms, except as such
enforceability may be subject to bankruptcy, moratorium, insolvency,
reorganization, arrangement, voidable preference, fraudulent
conveyance and other similar laws relating to or affecting the rights
of creditors and except as the same may be subject to the effect of
general principles of equity.
(c) Except as set forth in Section 5.1(c) of the ATS
Disclosure Schedule, neither the execution and delivery by ATS of this
Agreement or any Collateral Document executed or required to be
executed by it pursuant hereto or thereto, nor the consummation of the
Transactions by ATS, nor compliance with the terms, conditions and
provisions hereof or thereof by ATS:
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(i) will conflict with, or result in a breach
or violation of, or constitute a default under, any Organic
Document of ATS or any Applicable Law, or will conflict
with, or result in a breach or violation of, or constitute a
default under, or permit the acceleration of any obligation
or liability in, or but for any requirement of giving of
notice or passage of time or both would constitute such a
conflict with, breach or violation of, or default under, or
permit any such acceleration in, any Material Agreement of
ATS; or
(ii) will require ATS to make or obtain any
Governmental Authorization, Governmental Filing or Private
Authorization including without limitation under the FCA,
except as required by the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Act and other
than any of the foregoing that have been obtained.
(d) Except as set forth in Section 5.1(d) of the ATS
Disclosure Schedule, ATS does not have any Subsidiaries, each of which
is (i) wholly-owned unless noted otherwise in Section 5.1(d) of the
ATS Disclosure Schedule, (ii) an Entity which is duly organized,
validly existing and in good standing under the laws of the respective
state of organization, and (iii) duly qualified and in good standing
as a foreign corporation or other Entity in each other jurisdiction in
which the character of the property owned or leased by it or the
nature of its business or operations requires such qualification, with
full power and authority (corporate and other) to carry on the
business in which it is engaged, except for such qualifications the
failure of which to obtain, individually or in the aggregate, would
not have a Material Adverse Effect on ATS. ATS owns, directly or
indirectly, all of the outstanding capital stock and equity interests
of each Subsidiary, free and clear of all Liens (except for Permitted
Liens or except as set forth on Section 5.1(d) of the ATS Disclosure
Schedule), and all such stock or other equity interests has been duly
authorized and validly issued and is fully paid and nonassessable.
There are no outstanding Option Securities or Convertible Securities,
or agreements or understandings of any nature whatsoever, relating to
the authorized and unissued or outstanding capital stock or equity
interests of any Subsidiary of ATS, except as set forth in Section
5.1(d) of the ATS Disclosure Schedule with respect to the noncorporate
Subsidiaries of ATS.
5.2 Financial and Other Information. The financial statements of
ATS, furnished by ATS, and included in the ATS Information Statement (the "ATS
Financial Statements"), including in each case the notes thereto, have been
prepared in accordance with GAAP applied on a consistent basis throughout the
periods covered thereby, except as otherwise noted therein or as set forth in
Section 5.2 of the ATS Disclosure Schedule, and fairly present in all material
respects the financial condition and the results of operations and cash flow of
ATS, on the bases therein stated, as of the respective dates thereof, and for
the respective periods covered thereby subject, in the case of unaudited
financial statements, to normal nonmaterial year-end audit adjustments and
accruals.
5.3 Material Statements and Omissions; Absence of Events. Neither
any representation or warranty made by ATS contained in this Agreement or any
certificate, document or other instrument or other information furnished or to
be furnished by ATS pursuant to the provisions hereof (including without
limitation information with respect to ATS included in the ATS Prospectus and
the ATS Registration Statement) nor the ATS Disclosure Schedule or the ATS
Information Statement contains or will contain any untrue statement of a
material fact or omits or will omit to state any material fact required to make
any statement contained herein or therein, in light of the circumstances under
which they were made, not misleading; provided, however, that to the extent that
any such information contains any financial projections, ATS represents and
warrants only that such projections have been prepared in good faith on the
basis of the
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ATS Financial Statements and other information and assumptions which ATS
believes to be reasonable. Since the date of the most recent financial
statements constituting a part of the ATS Financial Statements, except to the
extent specifically described in Section 5.3 of the ATS Disclosure Schedule,
there has been no change in ATS which has had a Material Adverse Effect on ATS.
There is no Event known to ATS which has had, or (so far as ATS can now
reasonably foresee) is likely to have, a Material Adverse Effect on ATS, except
to the extent specifically described in Section 5.3 of the ATS Disclosure
Schedule and except for matters affecting the tower rental, ownership and
construction industry generally, including without limitation competition,
regulation and resources or events arising out of the execution or public
announcement of this Agreement.
5.4 Title to Properties; Leases.
(a) ATS has, to ATS' knowledge, good and indefeasible title
to all of its real property (other than leasehold real property) and
good title to all of its other assets (other than real property),
tangible and intangible (the "ATS Assets"); all of such real property
and other assets are so owned, in each case, free and clear of all
Liens, except (i) Permitted Liens, and (ii) Liens set forth on Section
5.4(a) of the ATS Disclosure Schedule. Except for financing statements
evidencing Liens referred to in the preceding sentence, no financing
statements under the Uniform Commercial Code and no other filing which
names ATS as debtor or which covers or purports to cover any of the
ATS Assets is on file in any state or other jurisdiction, and ATS has
not signed or agreed to sign any such financing statement or filing or
any agreement authorizing any secured party thereunder to file any
such financing statement or filing. Except as disclosed in Section
5.4(a) of the ATS Disclosure Schedule, all improvements on the real
property owned or leased by ATS are, to ATS' knowledge, in compliance
with applicable zoning, wetlands and land use laws, ordinances and
regulations and applicable title covenants, conditions, restrictions
and reservations in all respects necessary to conduct the operations
as presently conducted, except for any instances of non-compliance
which do not and will not in the aggregate have a Material Adverse
Effect on ATS. Except as disclosed in Section 5.4(a) of the ATS
Disclosure Statement, all such improvements comply with all Applicable
Laws, ATS Governmental Authorizations and ATS Private Authorizations,
except where noncompliance is not reasonably likely to have a Material
Adverse Effect on ATS. There is no pending or, to ATS' knowledge,
threatened or contemplated action to take by eminent domain or
otherwise to condemn any part of any real property constituting a
material portion of the real property owned by ATS or, to ATS'
knowledge, any real property leased by ATS. Except as set forth in
Section 5.4(a) of the ATS Disclosure Schedule, such real property
(other than land), fixtures, fixed assets and other material items of
personal property, including equipment, have, in ATS' reasonable
business judgment, been maintained in a manner consistent with
customary industry practices and currently permit the business of ATS
(the "ATS Business") to be operated in all material respects in
accordance with the terms and conditions of all Applicable Laws, ATS
Governmental Authorizations and ATS Private Authorizations.
(b) Each Lease or other occupancy or other agreement under
which ATS holds real or personal property constituting a part of the
ATS Assets has been duly authorized, executed and delivered by or
assigned to ATS and, to ATS' knowledge, each of the other parties
thereto, and is a legal, valid and binding obligation of ATS, and, to
ATS' knowledge, each of the other parties thereto, enforceable in
accordance with its terms, except as such enforceability may be
limited by bankruptcy, moratorium, insolvency and similar laws
affecting the rights and remedies of creditors and obligations of
debtors generally and by general principles of equity , and except for
such exceptions to the foregoing as, individually or in the aggregate,
have not had and will not have any Material Adverse
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Effect on ATS. ATS has a valid leasehold interest in and enjoys
peaceful and undisturbed possession under all Leases pursuant to which
it holds any such real property or tangible personal property, subject
to the terms of each such Lease and Applicable Law and except for such
exceptions to the foregoing as, individually or in the aggregate, have
not had and will not have any Material Adverse Effect on ATS. All of
such Leases are valid and subsisting and in full force and effect, and
neither ATS nor, to ATS' knowledge, any other party thereto, is in
material default in the performance, observance or fulfillment of any
obligation, covenant or condition contained in any such Lease, except
for such exceptions to the foregoing as, individually or in the
aggregate, have not had and will not have any Material Adverse Effect
on ATS.
5.5 Compliance with Private Authorizations. ATS has obtained all
Private Authorizations (collectively, the "ATS Private Authorizations") which
are necessary for the ownership or operation of the ATS Assets or the conduct of
the ATS Business which, if not obtained and maintained, could, individually or
in the aggregate, be reasonably likely to have a Material Adverse Effect on ATS.
All of the ATS Private Authorizations are valid and in good standing and are in
full force and effect, except for such exceptions as are not reasonably likely
to have a Material Adverse Effect on ATS. ATS is not in breach or violation of,
or in default in the performance, observance or fulfillment of, any ATS Private
Authorization, and no Event exists or has occurred, which constitutes, or but
for any requirement of giving of notice or passage of time or both would
constitute, such a breach, violation or default, under any ATS Private
Authorization, except for such defaults, breaches or violations as do not and
are not reasonably likely to have in the aggregate a Material Adverse Effect on
ATS. No ATS Private Authorization is the subject of any pending or, to ATS'
knowledge, threatened attack, revocation or termination, except for such
exceptions as are not reasonably likely to have a Material Adverse Effect on
ATS.
5.6 Compliance with Governmental Authorizations and Applicable Law.
(a) ATS has obtained all Governmental Authorizations
(collectively, the "ATS Governmental Authorizations") which are
necessary for the ownership or operation of the ATS Assets or the
conduct of the ATS Business as now conducted and which, if not
obtained and maintained, would, individually or in the aggregate, have
any Material Adverse Effect on ATS. None of the ATS Governmental
Authorizations is subject to any restriction or condition which would
limit in a material respect the ownership or operations of the ATS
Assets or the conduct of the ATS Business as currently conducted,
except for restrictions and conditions generally applicable to ATS
Governmental Authorizations of such type. The ATS Governmental
Authorizations are valid and in good standing, are in full force and
effect and are not impaired by any act or omission of ATS or its
officers, directors, employees or agents, and the ownership or
operation of the ATS Assets or the conduct of the ATS Business are in
accordance with the ATS Governmental Authorizations, except for such
exceptions to the foregoing as, individually or in the aggregate, have
not had and will not have any Material Adverse Effect on ATS. All
material reports, forms and statements required to be filed by ATS
with all Authorities with respect to the ATS Business have been filed
and are true, complete and accurate in all material respects. No ATS
Governmental Authorization is the subject of any pending or, to ATS'
knowledge, threatened challenge or proceeding to revoke or terminate
any ATS Governmental Authorization which, if revoked or terminated,
would have a Material Adverse Effect on ATS.
(b) ATS is in compliance with all Applicable Laws, except
where such noncompliance, individually or in the aggregate, has not
had and is not reasonably like to have a Material Adverse Effect on
ATS. Except as set forth in Section 5.6(b) of the ATS Disclosure
Schedule, there are no
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5.7 Intangible Assets. Except as set forth in Section 5.7 of the ATS
Disclosure Schedule, no Intangible Assets (except ATS Governmental
Authorizations and ATS Private Authorizations) are required for the ownership or
operation of the ATS Assets or the conduct of the ATS Business as currently
owned, operated and conducted, except for such exceptions to the foregoing as,
individually or in the aggregate, have not had and will not have any Material
Adverse Effect on ATS. ATS does not, to its knowledge, wrongfully infringe upon
or unlawfully use any Intangible Assets owned or claimed by another, and ATS has
not received any notice of any claim or infringement relating to any such
Intangible Asset, except for such exceptions to the foregoing as, individually
or in the aggregate, have not had and will not have any Material Adverse Effect
on ATS.
5.8 Related Transactions. ATS is not a party or subject to any
material Contractual Obligation relating to the ownership or operation of the
ATS Assets or the conduct of the ATS Business between ATS and any of its
officers, directors or stockholders or, to the knowledge of ATS, any Affiliate
of any thereof, including without limitation any Contractual Obligation
providing for the furnishing of services to or by, providing for rental of
property, real, personal or mixed, to or from, or providing for the lending or
borrowing of money to or from or otherwise requiring payments to or from, any
such Person, other than (i) Employment Arrangements listed or described in
Section 5.13 of the ATS Disclosure Schedule, (ii) Contractual Obligations
between ATS and any of its directors, stockholders or officers or any Affiliate
of any of the foregoing, which are on arms' length terms and conditions, (iii)
as specifically set forth in Section 5.8 of the ATS Disclosure Schedule;
provided, however, that the foregoing representation and warranty shall not
apply to the fact that prior to the consummation of the CBS Merger, all
administrative, accounting, corporate, data processing and other informational,
financial, human resources services, legal and other support services will have
been provided by ARS to ATS and without which services ATS could not operate in
the ordinary course of business. Following consummation of the Merger, a
sufficient number of the individuals presently providing such services to ATS on
behalf of ARS will continue to be available to provide services consistent with
past practice to ATS so that ATS will be able to operate in the ordinary course
of business.
5.9 Insurance. ATS maintains, with respect to the ATS Assets and the
ATS Business, policies of fire and extended coverage and casualty, liability and
other forms of insurance in such amounts and against such risks and losses as
are customary for companies engaged in similar businesses.
5.10 Tax Matters.
(a) ATS has in accordance with all Applicable Laws filed
all Tax Returns which are required to be filed, and has paid, or made
adequate provision for the payment of, all Taxes which have become due
and payable pursuant to said Tax Returns and all other governmental
charges and assessments received to date other than those Taxes being
contested in good faith for which adequate provision has been made on
the most recent balance sheet forming part of ATS Financial
Statements. The Tax Returns of ATS have been prepared in all material
respects in accordance with all Applicable Laws. All Taxes which ATS
is required by law to withhold and collect have been duly withheld and
collected, and have been paid over, in a timely manner, to the proper
Authorities to the extent due and payable. ATS has not executed any
waiver to extend, or otherwise taken or failed to take any action that
would have the effect of extending, the applicable statute of
limitations in respect of any Tax liabilities of ATS for the fiscal
years prior to and including the most recent fiscal year. ATS is not a
"consenting corporation" within the meaning of Section 341(f) of the
Code.
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ATS has at all times been taxable as a Subchapter C corporation under
the Code, and has never been a member of any consolidated group for
Tax purposes, except as a member of the consolidated group with ARS
and all of its Subsidiaries which can be consolidated for Federal
income tax purposes.
(b) Federal and state income Tax Returns of ATS have not
been examined by the IRS or applicable state Authority, and ATS has
not been notified of any proposed examination, except as shown in
Section 5.10(b) of the ATS Disclosure Schedule.
(c) ATS is not a party to any tax sharing agreement or
arrangement with any other Person, except as set forth in Section
5.10(c) of the ATS Disclosure Schedule.
5.11 Employee Retirement Income Security Act of 1974.
(a) ATS (which for purposes of this Section shall include
any ERISA Affiliate of ATS) currently sponsors, maintains and
contributes only to the Plans and Benefit Arrangements set forth in
Section 5.11(a) of the ATS Disclosure Schedule. ATS has delivered or
made available to ATC true, complete and correct copies of (i) each
Plan and Benefit Arrangement (or, in the case of any unwritten Plans
or Benefit Arrangements, reasonable descriptions thereof), (ii) the
two most recent annual reports on Form 5500 (including all schedules
and attachments thereto) filed with the Internal Revenue Service with
respect to each Plan (if any such report was required by Applicable
Law), (iii) the most recent summary plan description (or similar
document) for each Plan for which such a summary plan description is
required by Applicable Law or was otherwise provided to plan
participants or beneficiaries, and (iv) each trust agreement and
insurance or annuity contract or other funding or financing
arrangement relating to any Plan. To the knowledge of ATS, each such
Form 5500 and each such summary plan description (or similar document)
does not, as of the date hereof, contain any material misstatements.
ATS does not contribute to or have an obligation to contribute to, and
has not at any time within six (6) years prior to the date of this
Agreement contributed to or had an obligation to contribute to, and no
Plan listed in Section 5.11(a) of the ATS Disclosure Schedule is, (i)
a Multiemployer Plan, or (ii) a Plan subject to Section 412 of the
Code, Section 302 of ERISA or Title IV of ERISA. ATS has no actual or
potential liability under Title IV of ERISA. ATS does not maintain any
Plan that provides for post-retirement medical or life insurance
benefits, and ATS does not have any obligation or liability with
respect to any such Plan previously maintained by ATS, except as the
provisions of COBRA may apply to any former employees of ATS. Except
as set forth in Section 5.11(a) of the ATS Disclosure Schedule, as to
all Plans and Benefit Arrangements listed in Section 5.11(a) of the
ATS Disclosure Schedule:
(i) all such Plans and Benefit Arrangements
comply and have been administered in form and in operation
in accordance with their respective terms, and with all
Applicable Laws, in all material respects, and ATS has not
received any notice from any Authority disputing or
investigating such compliance;
(ii) none of the assets of any such Plan are
invested in employer securities or employer real property;
(iii) there are no Claims (other than routine
Claims for benefits or actions seeking qualified domestic
relations orders) pending or, to ATS' knowledge, threatened
involving such Plans or the assets of such Plans, and, to
ATS' knowledge, no facts exist which are
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reasonably likely to give rise to any such Claims (other
than routine Claims for benefits or actions seeking
qualified domestic relations orders);
(iv) all material contributions to, and
material payments from, the Plans and Benefit Arrangements
that may have been required to be made in accordance with
the terms of the Plans and Benefit Arrangements, and any
applicable collective bargaining agreement, have been made.
All such contributions to, and payments from, the Plans and
Benefit Arrangements, except those payments to be made from
a trust qualified under Section 401(a) of the Code, for any
period ending before the Closing Date that are not yet, but
will be, required to be made, will be properly accrued and
reflected on the financial books and records of ATS;
(v) No act, omission or transaction has
occurred which would result in imposition on ATS of (A) any
breach of fiduciary duty liability damages under Section 409
of ERISA, (B) a civil penalty assessed pursuant to
subsections (c), (i) or (l) of Section 502 of ERISA or (C) a
tax imposed pursuant to Chapter 43 of Subtitle D of the
Code;
(vi) ATS has not incurred any material
liability to a Plan (other than for contributions not yet
due) which liability has not been fully paid or accrued for
payment as of the date hereof;
(vii) except as otherwise contemplated by this
Agreement or the ATS Disclosure Schedule, no current or
former employee of ATS will be entitled to any additional
benefits or any acceleration of the time of payment or
vesting of any benefits under any Plan or Benefit
Arrangement as a result of the transactions contemplated by
this Agreement;
(viii) no compensation payable by ATS to any of
its employees under any existing Plan, Benefit Arrangement
(including by reason of the transactions contemplated
hereby) will be subject to disallowance under Section 162(m)
of the Code;
(ix) any amount that could be received (whether
in cash or property or the vesting of property) as a result
of any of the transactions contemplated by this Agreement by
any employee, officer, director or independent contractor of
ATS who is a "disqualified individual" (as such term is
defined in proposed Treasury Regulation Section 1.280G-1)
under any employment arrangement would not be characterized
as an "excess parachute payment" (as such term is defined in
Section 280G(b)(1) of the Code),;
(x) all such Plans maintained by ATS that are
intended to comply with Sections 401 and 501 of the Code
comply in all material respects with all applicable
requirements of such sections, and no Event has occurred
which is known to ATS which will give rise to
disqualification of any such Plan under such sections or to
a tax under Section 511 of the Code and each such Plan has
been the subject of a determination letter from the Internal
Revenue Service to the effect that such Plan and related
trust is qualified and exempt from Federal income Taxes
under Sections 401(a) and 501(a), respectively, of the Code;
no such determination letter has been revoked, and, to the
knowledge of ATS, revocation has not been threatened. ATS
has delivered or made available to ATC a copy of the most
recent determination letter received with respect to each
Plan for which such a letter has been issued, as well as a
copy of any pending application for a determination letter.
ATS has also
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provided or made available to ATC a list of all Plan
amendments as to which a favorable determination letter has
not yet been received;
(xi) no Plan which is an employee stock
ownership plan (an "ESOP") constitutes a leveraged employee
stock ownership plan within the meaning of Section
4975(e)(7) of the Code and there are no unallocated shares
of stock of ATS currently held under any such ESOP in a
suspense account; and
(xii) there are no outstanding options (or
contractual obligations to issue options) to acquire ATS
Common Stock or other ATS securities other than options held
by employees or directors of ATS and issued under Benefit
Arrangements (the aggregate number of which are as set forth
in Section 5.11(a) of the ATS Disclosure Schedule).
(b) The execution, delivery and performance by ATS of this
Agreement and the Collateral Documents executed or required to be
executed by ATS pursuant hereto and thereto will not involve any
prohibited transaction within the meaning of ERISA or Section 4975 of
the Code with respect to any Plan listed in Section 5.11(a) of the ATS
Disclosure Schedule.
5.12 Absence of Sensitive Payments. Neither ATS nor, to ATS'
knowledge, any of its officers, directors, employees, agents or other
representatives, has with respect to the ATS Assets or the ATS Business (a) made
any contributions, payments or gifts to or for the private use of any
governmental official, employee or agent where either the payment or the purpose
of such contribution, payment or gift is illegal under the laws of the United
States or the jurisdiction in which made or (b) established or maintained any
unrecorded fund or asset for any illegal purpose or made any false or artificial
entries on its books.
5.13 Employment Arrangements. ATS has no obligation or liability,
contingent or other, under any Employment Arrangement with any employee of ATS
or any of its Subsidiaries (the "ATS Employees"), other than (i) those listed or
described in Section 5.11(a) or Section 5.13 of the ATS Disclosure Schedule,
(ii) those incurred in the ordinary and usual course of business, or (iii) such
obligations or liabilities as do not and will not have, in the aggregate, any
Material Adverse Effect on ATS. Except as described in Section 5.13 of the ATS
Disclosure Schedule, (a) none of the ATS Employees is now, or since its
organization has been, represented by any labor union or other employee
collective bargaining organization, and ATS is not, and never has been, a party
to any labor or other collective bargaining agreement with respect to any of the
ATS Employees, (b) there are no pending grievances, disputes or controversies
with any union or any other employee or collective bargaining organization of
such employees, or threat of strikes, work stoppages or slowdowns or any pending
demands for collective bargaining by any such union or other organization, (c)
neither ATS nor any of such employees is now, or since its organization has
been, subject to or involved in or, to ATS' knowledge, threatened with, any
union elections, petitions therefor or other organizational or recruiting
activities, in each case with respect to the ATS Employees, and (d) none of the
ATS Employees has notified ATS that he or she does not intend to continue
employment with ATS until the Closing or with ATS following the Closing. ATS has
performed in all material respects all obligations required to be performed
under all Employment Arrangements of ATS and is not in material breach or
violation of or in material default or arrears under any of the terms,
provisions or conditions thereof.
5.14 Material Agreements. Listed on Section 5.14 of the ATS
Disclosure Schedule are all Material Agreements relating to the ownership or
operation of the ATS Assets or the conduct of the ATS Business or to which ATS
is a party or to which it is bound or which any of the ATS Assets is subject.
True, accurate and complete copies of each of such Material Agreements have been
made available by ATS to ATC. All of such
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Material Agreements are valid, binding and legally enforceable obligations of
ATS, except as such enforceability may be limited by bankruptcy, moratorium,
insolvency and similar laws affecting the rights and remedies of creditors and
obligations of debtors generally and by general principles of equity. ATS has
complied with all of the material terms and conditions of each such Material
Agreement and has not done or performed, or failed to do or perform (and there
is no pending or, to the knowledge of ATS, threatened in writing Claim with
which ATS has not so complied, done and performed or failed to do and perform)
any act which would invalidate or provide grounds for the other party thereto to
terminate (with or without notice, passage of time or both) such Material
Agreement or impair the rights or benefits, or increase the costs, of ATS under
any of such Material Agreements, except for such noncompliances, acts or
omissions that, individually or in the aggregate, have not had and will not have
a Material Adverse Effect on ATS. Without limiting the generality of the
foregoing, Section 5.14 of the ATS Disclosure Schedule sets forth a true,
correct and complete description of all material acquisitions pending or which
are actively being negotiated and the current status of all such acquisitions,
except for those which ATS cannot disclose due to its obligations to maintain
the same in confidence, none of which, if consummated on the terms and
conditions currently being negotiated, will have a Material Adverse Effect on
ATS.
5.15 Ordinary Course of Business. Since September 30, 1997, except
(i) as may be described on Section 5.15 of the ATS Disclosure Schedule, or (ii)
as may be required or expressly permitted or contemplated by the terms of this
Agreement, ATS:
(a) has operated its business in all material respects in
the normal, usual and customary manner in the ordinary and regular
course of business, consistent with past practice, it being understood
that the acquisition and financing of communications sites and related
assets and other business involved in the communications sites
industry and the construction of communications towers and related
assets is part of the ordinary course of business of ATS;
(b) except in each case in the ordinary course of business,
consistent with past practice, it being understood that the
acquisition and financing of communications sites and related assets
and other business involved in the communications sites industry and
the construction of communications towers and related assets is part
of the ordinary course of business of ATS:
(i) has not incurred any obligation or
liability (fixed, contingent or other) individually having a
value in excess of $100,000;
(ii) has not sold or otherwise disposed of or
contracted to sell or otherwise dispose of any of its
properties or assets having a value in excess of $100,000;
(iii) has not entered into any individual
commitment having a value in excess of $100,000; and
(iv) has not canceled any debts or claims;
(c) has not created or permitted to be created any Lien on
any of its property, except for Permitted Liens;
(d) has not made or committed to make any additions to its
property or any purchases of equipment, except in the ordinary course
of business consistent with past practice or for normal maintenance
and replacements;
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(e) except in the ordinary course of business consistent
with past practice, has not increased the compensation payable or to
become payable to any of the ATS Employees or otherwise materially
altered, modified or changed the terms of their employment;
(f) has not suffered any damage, destruction or loss
(whether or not covered by insurance) or any acquisition or taking of
property by any Authority that has had or is reasonably likely to have
a Material Adverse Effect on ATS;
(g) has not waived any rights of material value without
fair and adequate consideration;
(h) has not experienced any work stoppage;
(i) except in the ordinary course of business, has not
entered into, amended or terminated any Lease, Governmental
Authorization, Private Authorization, Material Agreement or Employment
Arrangement, or any transaction, agreement or arrangement with any
Affiliate of ATS; and
(j) has not made, paid or declared any Distribution.
5.16 Material and Adverse Restrictions. ATS is not a party to or
subject to, nor is any of the ATS Assets subject to, any Applicable Law,
Governmental Authorization, Contractual Obligation, Employment Arrangement,
Material Agreement or Private Authorization, or any other obligation or
restriction of any kind or character, which now has or, as far as ATS can now
reasonably foresee, at any time in the future, individually or in the aggregate,
is likely to have, any Material Adverse Effect on ATS, except as set forth in
Section 5.16 of the ATS Disclosure Schedule and except for matters affecting the
tower rental and construction industry generally.
5.17 Broker or Finder. No Person assisted in or brought about the
negotiation of this Agreement or the Merger in the capacity of broker, agent or
finder or in any similar capacity on behalf of ATS or, to the knowledge of ATS,
ARS which, in each case, will result in liability to the Surviving Corporation
which was not reflected in the financial information heretofore furnished by ATS
to ATC.
5.18 Solvency. As of the execution and delivery of this Agreement,
ATS is, and immediately prior to the consummation of the Merger will be,
Solvent.
5.19 Environmental Matters. Except as set forth in Section 5.19 of
the ATS Disclosure Schedule, with respect to the ATS Assets and the ATS
Business, ATS:
(a) has not been notified that it is potentially liable
under, has not received any request for information or other
correspondence concerning its potential liability with respect to any
site or facility under, and, to ATS' knowledge, is not a "potentially
responsible party" under, the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended, the Resource
Conservation Recovery Act, as amended, or any similar state law;
(b) has not entered into or received any consent decree,
compliance order or administrative order issued pursuant to any
Environmental Law;
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(c) is not a party in interest or in default under any
judgment, order, writ, injunction or decree of any Final Order issued
pursuant to any Environmental Law;
(d) has obtained all Environmental Permits required under
Environmental Laws, and has filed all applications, notices and other
documents required to be filed prior to the date of this Agreement to
effect the timely renewal or issuance of all Environmental Permits for
the continued conduct of its business in the manner now conducted;
(e) is in compliance in all material respects with all
Environmental Laws, and is not the subject of or, to ATS' knowledge,
threatened with any Legal Action involving a demand for damages or
other potential liability, including any Lien, with respect to
violations or breaches of any Environmental Law;
(f) has provided ATC with copies of all environmental site
assessments, audits or other investigatory reports in its possession
that pertain to any property currently owned, leased, operated or
occupied by ATS;
(g) has not installed or used any above ground or
underground storage tanks, friable asbestos, polychlorinated biphenyls
or urea formaldehyde foam insulation on any property currently owned,
leased or operated by ATS and, to ATS' knowledge, there are no above
ground or underground storage tanks, friable asbestos, polychlorinated
biphenyls or urea formaldehyde foam insulation or any property
currently owned, leased or operated by ATS;
(h) has not disposed of, released, spilled or buried any
Hazardous Materials (nor has any Person acting on its behalf done so)
in violation of Environmental Laws on any property or facility owned,
leased, operated or occupied by ATS or to ATS' knowledge at any
facility or site to which Hazardous Materials from or generated by ATS
may have been taken at any time in the past;
(i) has no knowledge of any disposal, release, spill or
burial of any Hazardous Materials by ATS (or any Person acting on its
behalf) on any property which could reasonably be expected to result
or has resulted in contamination which requires investigation,
remediation or other response activity on or beneath any properties or
facilities currently owned, leased, operated or occupied by ATS; and
(j) has no knowledge of any past or present Event related
to ATS' properties, operations or business, which Event, individually
or in the aggregate, could reasonably be expected to interfere with or
prevent continued material compliance with all Environmental Laws
applicable to the conduct of ATS' business in the manner now
conducted, or which, individually or in the aggregate, could
reasonably be expected to form the basis of any material Claim against
ATS in connection with the release or threatened release into the
environment of any Hazardous Material.
5.20 Capital Stock. The authorized and outstanding capital stock of
ATS is as set forth in Section 5.20 of the ATS Disclosure Schedule. All of such
outstanding capital stock has been duly authorized and validly issued, is fully
paid and nonassessable and is owned of record and, to ATS' knowledge,
beneficially by ARS. Except as described in Section 5.20 of the ATS Disclosure
Schedule, ATS has not granted or issued, nor has ATS agreed to grant or issue,
any shares of its capital stock or any Option Security or Convertible Security,
and ATS is not a party to or bound by any agreement, put or commitment pursuant
to which it is obligated to purchase, redeem or otherwise acquire any shares of
capital stock or any Option Security or
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Convertible Security. The shares of ATS Class A Common Stock to be issued
pursuant to consummation of the Merger or upon exercise of the ATS Options have
been duly authorized and, when so issued, will be validly issued, fully paid and
nonassumable, and all such shares have been duly reserved for issuance pursuant
to such consummation or exercise.
5.21 State Takeover Statutes. To ATS' knowledge, no state takeover
Law, statute or similar statute or regulation applies or purports to apply to
the Merger, this Agreement or any of the transactions contemplated by this
Agreement.
5.22 ATS Private Placement. ATS and the Persons named in the ATS
Information Statement (and possible other Persons) intend to enter into binding
and definitive documentation substantially on the terms and conditions described
in the ATS Information Statement with respect to the ATS Private Placement.
Pursuant to such documentation, ATS and such Persons will have agreed to
purchase shares of ATS Class B Common Stock for a per share purchase price of
not less than $9.00 per share and for an aggregate purchase price equal to not
less than $80.0 million on such other terms and conditions not materially less
favorable, in the aggregate, to ATS than those described in the ATS Information
Statement.
5.23 ARS Organization and Business; Power and Authority; Effect of
Transaction.
(a) ARS is a corporation duly organized, validly existing
and in good standing under the laws of its jurisdiction of
organization, has all requisite power and authority (corporate and
other) to own or hold under lease its properties and to conduct its
business as now conducted and is duly qualified and in good standing
as a foreign corporation in each other jurisdiction in which the
character of the property owned or leased by it or the nature of its
business or operations requires such qualification, except for such
qualifications the failure of which to obtain, individually or in the
aggregate, would not have a Material Adverse Effect on ARS.
(b) ARS has all requisite power and authority (corporate
and other) and has in full force and effect all Governmental
Authorizations and Private Authorizations necessary to enable it to
execute and deliver, and to perform its obligations under, the CBS
Merger Agreement and each agreement or other document executed or
required to be executed by it pursuant thereto, including without
limitation the ATS Separation Agreement, and to consummate the CBS
Merger and the Tower Distribution; and the execution, delivery and
performance of the CBS Merger Agreement and each agreement or other
document executed or required to be executed by ARS pursuant thereto,
including without limitation the ATS Separation Agreement, have been
duly authorized by all requisite corporate or other action on the part
of ARS, and no other corporate proceedings on the part of ARS,
including without limitation that of the ARS common stockholders, are
necessary to authorize the CBS Merger Agreement or the transactions
contemplated thereby, including without limitation the ATS Separation
Agreement, or to consummate the CBS Merger and the Tower Distribution.
The CBS Merger Agreement has been duly executed and delivered by ARS
and constitutes, and each agreement or other document executed or
required to be executed by it pursuant thereto or to consummate the
CBS Merger and the Tower Distribution, when executed and delivered by
ARS will constitute, legal, valid and binding obligations of ARS,
enforceable in accordance with their respective terms, except as such
enforceability may be subject to bankruptcy, moratorium, insolvency,
reorganization, arrangement, voidable preference, fraudulent
conveyance and other similar laws relating to or affecting the rights
of creditors and except as the same may be subject to the effect of
general principles of equity. No consent or approval from the
stockholders of ARS is required to consummate the Merger (including
the issuance of the Merger Consideration) or the Tower Distribution,
except
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that a waiver of the restricted payments covenant of the Certificate
of Designation with respect to the ARS Cumulative Preferred Stock (the
"ARS Preferred Certificate") will be required from the holders thereof
in order to effect the Tower Distribution, whether pursuant to the CBS
Merger Agreement or otherwise.
(c) Except as set forth in Section 5.23(c) of the ATS
Disclosure Schedule or in Section 5.23(b), neither the execution and
delivery by ARS of the CBS Merger Agreement or any agreement or other
document executed or required to be executed by it pursuant thereto,
nor the consummation of the CBS Merger or the Tower Distribution by
ARS, nor compliance with the terms, conditions and provisions hereof
or thereof by ARS:
(i) will conflict with, or result in a breach
or violation of, or constitute a default under, any Organic
Document of ARS or any Applicable Law, or will conflict
with, or result in a breach or violation of, or constitute a
default under, or permit the acceleration of any obligation
or liability in, or but for any requirement of giving of
notice or passage of time or both would constitute such a
conflict with, breach or violation of, or default under, or
permit any such acceleration in, any Material Agreement of
ARS; or
(ii) will require ARS to make or obtain any
Governmental Authorization, Governmental Filing or Private
Authorization including without limitation under the FCA,
except as required by the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Act and other
than any of the foregoing that have been obtained.
ARTICLE 6
COVENANTS
6.1 Access to Information; Confidentiality.
(a) Each party shall afford to the other party and its
accountants, counsel, financial advisors and other representatives
(the "Representatives") full access during normal business hours
throughout the period prior to the Closing Date to all of its (and its
Subsidiaries') properties, books, contracts, commitments and records
(including without limitation Tax Returns), but excluding any of the
foregoing that are or may become the subject of, and not disclosable
under, the terms of any confidential agreement (the "Restricted
Information") and, during such period, shall furnish promptly upon
request (i) a copy of each report, schedule and other document filed
or received by either party pursuant to the requirements of any
Applicable Law (including without limitation the FCA) or filed by it
with any Authority in connection with the Merger or any other report,
schedule or documents which may have a material effect on the
businesses, operations, properties, prospects, personnel, condition,
(financial or other), or results of operations of their respective
businesses, (ii) to the extent not provided for pursuant to the
preceding clause, all financial records, ledgers, work papers and
other sources of financial information possessed or controlled by it
or its accountants deemed by each party or its Representatives
necessary or useful for the purpose of performing an audit of the
business and assets of ATC and ATS, as applicable, and, in the case of
ATS, certifying financial statements and financial information
pursuant to the provisions of Section 7.2(d), and (iii) such other
information concerning any of the foregoing as ATS or ATC shall
reasonably request, other than any Restricted Information. All
Confidential Information furnished pursuant to the provisions of this
Agreement, including without limitation this Section, will be kept
confidential and shall not, without the prior
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written consent of the party disclosing such Confidential Information,
which consent shall not be unreasonably withheld, delayed or
conditioned, be disclosed by the other party in any manner whatsoever,
in whole or in part, and, except as required by Applicable Law, shall
not be used for any purposes, other than in connection with the Merger
(including without limitation in connection with any registration,
proxy or information statement or similar document filed pursuant to
any federal or state securities Law) . Except as otherwise herein
provided, each party agrees to reveal such Confidential Information
only to those of its Representatives or other Persons who need to know
such Confidential Information for the purpose of evaluating and
consummating the Merger who are informed of its confidential nature.
For purposes of this Agreement, "Confidential Information" shall mean
any and all information (excluding information that (i) has been or is
obtained from a source independent of the disclosing party, (ii) is or
becomes generally available to the public other than as a result of
unauthorized disclosure by the receiving party, or (iii) is
independently developed by the receiving party without reliance in any
way on information provided by the disclosing party) related to the
business or businesses of ATS and its Affiliates, on the one hand, or
ATC and its Affiliates, on the other hand, including any of their
respective successors and assigns.
(b) In the event that this Agreement is terminated in
accordance with its terms, each party shall promptly redeliver all
written Confidential Information provided pursuant to this Section or
any other provision of this Agreement or otherwise in connection with
the Merger and shall not retain any copies, extracts or other
reproductions in whole or in part of such written material, other
than, in the event any Legal Action or Claim is then pending,
threatened or reasonably likely to be asserted, one copy thereof which
shall be delivered to independent counsel for such party.
(c) No investigation pursuant to this Section or otherwise
shall affect any representation or warranty in this Agreement of
either party or any condition to the obligations of the parties
hereto.
(d) The provisions of this Section shall apply to all
Subsidiaries of ATC and ATS.
6.2 Agreement to Cooperate.
(a) Each of the parties hereto shall use reasonable
business efforts (x) to take, or cause to be taken, all actions and to
do, or cause to be done, all things necessary, proper or advisable
under Applicable Law to consummate the Merger according to the terms
and subject to the conditions hereof, and (y) to refrain from taking,
or cause to be taken, any action and to refrain from doing or causing
to be done, anything which could impede or impair the consummation of
the Merger according to the terms and subject to the conditions hereof
or the consummation of the other Transactions according to the terms
and subject to the conditions hereof, including, in all cases, without
limitation using its reasonable business efforts (i) to prepare and
file with the applicable Authorities as promptly as practicable after
the execution of this Agreement all requisite applications and
amendments thereto, together with related information, data and
exhibits, necessary to request issuance of orders approving the Merger
by all such applicable Authorities, (ii) to obtain all necessary or
appropriate waivers, consents and approvals, (iii) to effect all
necessary registrations, filings and submissions (including without
limitation, if required, filings within ten (10) business days of the
date of this Agreement under the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Act and all filings
necessary for ATS to own and operate the ATC Assets and the ATC
Business), (iv) to lift any injunction or other legal bar to the
Merger (and, in such case, to proceed with the Merger as expeditiously
as possible), and (v) to obtain the satisfaction of the conditions
specified in Article 7, including without limitation the truth and
correctness as of the Closing Date as if made on and as of the Closing
Date (other than those that
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speak as of a specific date which need only be true and correct as of
such date) of the representations and warranties of such party and the
performance and satisfaction as of the Closing Date of all agreements
and conditions to be performed or satisfied by such party.
(b) ATC shall cooperate and use its reasonable business
efforts to cause its independent accountants to reasonably cooperate
with ATS, and at ATS' expense, in order to enable ATS to have ATC's or
ATS' independent accountants prepare audited financial statements for
ATC described in Section 7.2(d). ATC will use its reasonable business
efforts to ensure that such financial statements will have been
prepared in accordance with GAAP applied on a basis consistent with
the ATC Financial Statements and will present fairly in all material
respects the financial condition, results of operation and cash flow
of ATC. Without limiting the generality of the foregoing, ATC agrees
that it will (i) consent to the use of such audited financial
statements in any registration, proxy or information statement or
other document filed by ATS or any of its Affiliates under the
Securities Act or the Exchange Act and (ii) execute and deliver, and
cause its officers to execute and deliver, such "representation"
letters as are customarily delivered in connection with audits and as
ATS' or ATC's independent accountants may reasonably request under the
circumstances.
(c) Without limiting the generality of the foregoing, as
promptly as practicable after the execution of this Agreement, ATS and
ATC shall, at the written request of the other made from time to time
within thirty (30) days of the date of this Agreement, deliver or
cause to be delivered to ATC or ATS, as the case may be, copies of (i)
all title report and title insurance and (ii) Phase I environmental
site assessment reports or other environmental reports or studies in
their possession with respect to real property owned or leased by such
party. Each of ATS and ATC (an "investigating party") may at its own
cost and expense obtain, and deliver to the other party (the "owning
party") full and complete copies of, preliminary title reports and/or
Phase I environmental site assessment reports (or other environmental
reports or studies) with respect to any real property owned or leased
by the owning party (i) which is not covered by a title or
environmental report delivered to the investigating party or (ii) with
respect to which the title or environment report so furnished, in the
reasonable business judgment of the investigating party, raises
questions of (x) defects in title, in the case of title reports, or
(y) potential liability, in the case of Phase I environmental site
assessment reports (or other environmental reports or studies) which,
in the case of title defects or potential liability has had or could
reasonably be expected to have a Material Adverse Effect on the owning
or leasing party. Site assessments shall be conducted by such
consultants and professionals as ATS and ATC shall mutually agree and
shall be arranged at times mutually convenient to the parties. Each of
ATC and ATS shall be entitled to have representatives present at the
time such site assessments are conducted, and to have copies of all
correspondence with any environmental company conducting the site
assessment pursuant to the provisions of this Section.
(d) ATC agrees that prior to the Closing Date it will not
make or permit to be made any change affecting any bank, trust
company, savings and loan association, brokerage firm or safe deposit
box or in the names of the Persons authorized to draw thereon, to have
access thereto or to authorize transactions therein or in such powers
of attorney, or open any additional accounts or boxes or grant any
additional powers of attorney, without in each case notifying ATS in
writing on or prior to the Closing Date.
6.3 Public Announcements. Until the Closing or the termination of
this Agreement, each party shall consult with the other before issuing any press
release or otherwise making any public statements with
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respect to this Agreement or the Merger and shall not issue any such press
release or make any such public statement without the prior consent of the
other. Notwithstanding the foregoing, the parties acknowledge and agree that
they may, without each other's prior consent, issue such press releases or make
such public statements as may be required by Applicable Law, in which case the
disclosing party shall use its reasonable business efforts to consult with the
other party and agree upon the nature, content and form of such disclosure,
press release or other statement.
6.4 Notification of Certain Matters. Each party shall give prompt
notice to the other, of the occurrence or non-occurrence of any Event of which
such party becomes aware the occurrence or non-occurrence of which would be
reasonably likely to cause (a) any representation or warranty made by it
contained in this Agreement to be untrue or inaccurate in any material respect
or (b) any failure made by it to comply with or satisfy, or be able to comply
with or satisfy, in any material respect, any covenant, condition or agreement
to be complied with or satisfied by it under this Agreement in any material
respect, such that, in any such case, one or more of the conditions of Closing
would not be satisfied; provided, however, that the delivery of any notice
pursuant to this Section shall not limit or otherwise affect the rights and
remedies available hereunder to the party receiving such notice or the
obligations of the party delivering such notice and shall not, in any event,
affect the representations, warranties, covenants and agreements of the parties
or the conditions to their respective obligations under this Agreement.
6.5 No Solicitation. Neither ATC nor ATS shall, nor shall either of
them knowingly permit any of its or any of their Representatives or, with
respect to ATS, permit ARS (including, without limitation, any officer,
director, stockholder or any investment banker, broker, finder, attorney or
accountant retained by it) to, initiate, solicit or facilitate, directly or
indirectly, any inquiries or the making of any proposal with respect to any
Alternative Transaction applicable to it, engage in any discussions or
negotiations concerning, or provide to any other Person any information or data
relating to, it for the purposes of, or otherwise cooperate in any way with or
assist or participate in, or facilitate any inquiries or the making of any
proposal which constitutes, or may reasonably be expected to lead to, a proposal
to seek or effect any Alternative Transaction applicable to it, or agree to or
endorse any Alternative Transaction applicable to it. If ATC or ATS or any of
its Representatives receives any inquiry with respect to an Alternative
Transaction applicable to it while this Agreement is in effect, ATC or ATS, as
the case may be, shall inform the inquiring party that it is not entitled to
enter into discussions or negotiations relating to such an Alternative
Transaction. The provisions of this Section shall apply to all Subsidiaries of
ATC and ATS.
6.6 Conduct of Business by ATS Pending the Merger. Without limiting
any other covenant or agreement of ATS set forth in this Agreement, except as
otherwise permitted or contemplated by this Agreement, including without
limitation pursuant to the ATS Separate Agreement and, in the case of paragraphs
(a) and (b)(ii) and (iii), the Tower Distribution, after the date hereof and
prior to the Closing Date or earlier termination of this Agreement unless ATC
shall otherwise agree in writing, ATS shall, and shall cause its Subsidiaries,
to:
(a) conduct its business in the ordinary and usual course
of business and consistent with past practice, it being understood
that the acquisition of communications sites and related assets and
other business involved in the communications sites industry and the
construction and maintenance of communications towers and related
assets is part of the ordinary course of business of ATS; provided,
however, that any such acquisition or construction activity shall be
subject to the other paragraphs of this Section, including without
limitation paragraphs (d) and (l);
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(b) not (i) amend or propose to amend their respective
Organic Documents, (ii) split, combine or reclassify (whether by stock
dividend or otherwise) its outstanding capital stock or issue or
authorize the issuance of any other securities in respect of, in lieu
of, or in substitution for shares of its capital stock, or (iii)
declare, set aside or pay any dividend or distribution payable in
cash, stock, property or otherwise;
(c) not issue, sell, transfer, assign, convey, pledge or
dispose of, or agree to issue, sell, transfer, assign, convey, pledge
or dispose of, any shares of ATS Common Stock, Convertible Securities,
Option Securities or other equity securities;
(d) not (i) incur or become contingently liable with
respect to any Indebtedness for Money Borrowed other than (x)
borrowings, in addition to those permitted or consented to pursuant to
the provisions of clause (y) immediately following, not to exceed the
sum of (I) the principal amount of borrowings presently outstanding
and (II) $5.0 million in the aggregate outstanding at any one time,
and (y) borrowings necessary to finance acquisitions and construction
projects permitted or consented pursuant to the provisions of
paragraph (l) below, (ii) redeem, purchase, acquire or offer to
purchase or acquire any shares of its capital stock, Convertible
Securities or Option Securities (iii) sell, lease, license, pledge,
dispose of or encumber any properties or assets or sell any businesses
other than (A) pursuant to agreements which are described in Section
6.6(d) of the ATS Disclosure Schedule, (B) Liens arising in accordance
with the provisions of indebtedness in effect on the date hereof and
in accordance with their present terms, and (C) leases of towers and
shelter space to third-party customers, or (iv) make any loans,
advances or capital contributions to, or investments in, any other
Person, except to officers and employees of ATS for travel, business
or relocation expenses in the ordinary course of business consistent
with past practices;
(e) use reasonable business efforts to preserve intact its
business organization and goodwill, keep available the services of its
present officers and key employees, and preserve the goodwill and
business relationships with customers and others having business
relationships with them and not engage in any action, directly or
indirectly, with the intent to adversely impact the transactions
contemplated by this Agreement;
(f) at ATC's reasonable request, confer on a regular basis
with one or more representatives of ATC to report material operational
matters and the general status of ongoing operations, including
without limitation the status of pending and prospective acquisitions
and of the CBS Merger, including the satisfaction of the conditions to
consummation thereof, to the extent permitted or not restricted by
confidentiality provisions;
(g) not adopt, enter into, amend or terminate any
employment, severance, special pay arrangement with respect to
employment or termination of employment or other similar arrangements
or agreements with any directors, officers or key employees;
(h) maintain with financially responsible insurance
companies insurance on the ATS Assets and the ATS Business in such
amounts and against such risks and losses as are consistent with past
practice;
(i) not make any Tax election that could reasonably be
likely to have a Material Adverse Effect on ATS or settle or
compromise any material income Tax liability;
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(j) except in the ordinary course of business, not modify
or amend in any material adverse manner or terminate any Material
Agreement to which ATS is a party or by which any of the ATS Assets
may be bound or to which any of them may be subject or waive, release
or assign any material rights or claims thereunder;
(k) not make any material change to its accounting methods,
principles or practices, except as may be required by GAAP;
(l) not enter into or agree to enter into any Restricted
Transaction (or group of related Restricted Transactions), whether for
its own account or for any other Person, if (i) the aggregate amount
reasonably expected to be expended by ATS or any of its Subsidiaries
in connection with such individual Restricted Transaction (together
with any group of related Restricted Transactions) exceeds $5.0
million, or (ii) the aggregate amount to be expended in connection
with all Restricted Transactions (together with any group of related
Restricted Transactions) exceeds $20.0 million; provided, however,
that the foregoing restriction shall not apply to any Restricted
Transaction pursuant to agreements which are described in Section
6.6(l) of the ATS Disclosure Schedule. (ATC agrees not to unreasonably
withhold, delay or condition a consent to any Restricted Transaction
as to which ATS has requested its consent pursuant to the provisions
of this Section, it being understood that any such consent shall not,
however, relieve ATS from the obligation to comply with the provisions
of this Agreement (other than, to the extent so consented to,
paragraph (d) hereof) and shall not be deemed to be a waiver of any
condition of ATC's obligations to consummate the Merger set forth in
Section 7.3);
(m) except as set forth in Section 5.13 of the ATS
Disclosure Schedule, (i) not grant to any executive officer or other
key employee of ATS any increase in compensation, except for normal
increases in the ordinary course of business consistent with past
practice, (ii) not grant to any such executive officer any increase in
severance or termination pay, (iii) not adopt or amend any Plan or
Benefit Arrangement (including change any actuarial or other
assumption used to calculate funding obligations with respect to any
Plan, or change the manner in which contributions to any Plan are made
or the basis on which such contributions are determined) and (iv)
except in the ordinary course, not enter into, amend in any material
respect or terminate any Governmental Authorization, material Private
Authorization or Contract, except, for purposes of this clause (iv)
only, as would not, individually or in the aggregate, be reasonably
likely to have a Material Adverse Effect on ATS;
(n) not voluntarily take or permit to be taken any action
which if taken between the end of its most recent fiscal quarter and
prior to the date of this Agreement would have been required to be
noted as an exception on Section 5.15 of the ATS Disclosure Schedule,
other than as permitted or not restricted by the preceding provisions
of this Section 6.6; and
(o) not authorize or enter into any agreement that would
violate any of the foregoing.
6.7 Conduct of Business by ATC Pending the Merger. Without limiting
any other covenant or agreement of ATC set forth in this Agreement, except as
otherwise permitted or contemplated by this Agreement, or as set forth or
described in the ATC Disclosure Schedule, after the date hereof and prior to the
Closing Date or earlier termination of this Agreement, unless ATS shall
otherwise consent in writing, ATC shall, and shall cause its Subsidiaries to:
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(a) conduct its business in the ordinary and usual course
of business and consistent with past practice, it being understood
that the acquisition of communications sites and related assets and
other business involved in the communications sites industry and the
construction and maintenance of communications towers and related
assets is part of the ordinary course of business of ATC; provided,
however, that any such acquisition or construction activity shall be
subject to the other paragraphs of this Section, including without
limitation paragraphs (d) and (l);
(b) not (i) amend or propose to amend their respective
Organic Documents, (ii) split, combine or reclassify (whether by stock
dividend or otherwise) its outstanding capital stock or issue or
authorize the issuance of any other securities in respect of, in lieu
of, or in substitution for shares of its capital stock, or (iii)
declare, set aside or pay any dividend or distribution payable in
cash, stock, property or otherwise;
(c) not issue, sell, transfer, assign, convey, pledge or
dispose of, or agree to issue, sell, transfer, assign, convey, pledge
or dispose of, any shares of ATC Common Stock, Convertible Securities,
Option Securities or other equity securities;
(d) not (i) incur or become contingently liable with
respect to any Indebtedness for Money Borrowed other than (x)
borrowings, in addition to those permitted or consented to pursuant to
the provisions of clause (y) immediately following, not to exceed $2.5
million in the aggregate outstanding at any one time, (y) borrowings
necessary to fund finance acquisitions or construction projects
permitted pursuant to the provisions of paragraph (l) below or to fund
bonus payments and transaction fees permitted by the provisions of
this Agreement, and (z) up to $4.5 million of subordinated borrowings
to exercise redemption rights with respect to ATC's preferred stock,
(ii) redeem, purchase, acquire or offer to purchase or acquire any
shares of its capital stock, Convertible Securities or Option
Securities (iii) sell, lease, license, pledge, dispose of or encumber
any properties or assets (except for nonstrategic assets that in the
aggregate have a fair market value of less than $1.0 million) or sell
any businesses other than (A) pursuant to agreements which are
described in Section 6.7(d) of the ATC Disclosure Schedule, (B) Liens
arising in accordance with the provisions of indebtedness in effect on
the date hereof and in accordance with their present terms, and (C)
leases of towers and shelter space to third-party customers or (iv)
make any loans, advances or capital contributions to, or investments
in, any other Person, except to officers and employees of ATC for
travel, business or relocation expenses in the ordinary course of
business consistent with past practices;
(e) use reasonable business efforts to preserve intact its
business organization and goodwill, keep available the services of its
present officers and key employees (other than individuals identified
to ATS prior to date hereof with specific reference to this
provision), and preserve the goodwill and business relationships with
customers and others having business relationships with them and not
engage in any action, directly or indirectly, with the intent to
adversely impact the transactions contemplated by this Agreement;
(f) at ATS' reasonable request, confer on a regular basis
with one or more representatives of ATS to report material operational
matters and the general status of ongoing operations, including
without limitation the status of pending and prospective acquisitions
to the extent permitted or not restricted by confidentiality
provisions;
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(g) not adopt, enter into, amend or terminate any
employment, severance, special pay arrangement with respect to
employment or termination of employment or other similar arrangements
or agreements with any directors, officers or key employees;
(h) maintain with financially responsible insurance
companies insurance on the ATC Assets and the ATC Business in such
amounts and against such risks and losses as are consistent with past
practice;
(i) not make any Tax election that could reasonably be
likely to have a Material Adverse Effect on ATC or settle or
compromise any material income Tax liability;
(j) except in the ordinary course of business, not modify
or amend in a manner materially adverse to ATC or terminate any
Material Agreement to which ATC is a party or by which any of the ATC
Assets may be bound or to which any of them may be subject or waive,
release or assign any material rights or claims thereunder;
(k) not make any material change to its accounting methods,
principles or practices, except as may be required by GAAP;
(l) not enter into or agree to enter into any Restricted
Transactions (or group of related Restricted Transactions), whether
for its own account or for any other Person, if (i) the aggregate
amount reasonably expected to be expended by ATC or any of its
Subsidiaries in connection with such individual Restricted Transaction
(together with any group of related Restricted Transactions) exceeds
$5.0 million, or (ii) the aggregate amount to be expended in
connection with all Restricted Transactions (together with any group
of related Restricted Transactions) exceeds $20.0 million; provided,
however, that the foregoing restriction shall not apply to any
Restricted Transaction pursuant to agreements which are described in
Section 6.7(l) of the ATC Disclosure Schedule. (ATS agrees not to
unreasonably withhold, delay or condition a consent to any Restricted
Transaction as to which ATC has requested its consent pursuant to the
provisions of this Section, it being understood that any such consent
shall not, however, relieve ATC from the obligation to comply with the
provisions of this Agreement (other than, to the extent so consented
to, paragraph (d) hereof) and shall not be deemed to be a waiver of
any condition of ATS' obligations to consummate the Merger set forth
in Section 7.2);
(m) except as set forth in Section 4.14 of the ATC
Disclosure Schedule, (i) not grant to any executive officer or other
key employee of ATC any increase in compensation, except for normal
increases in the ordinary course of business consistent with past
practice or as required under Benefit Arrangements in effect as of
September 30, 1997, (ii) not grant to any such executive officer any
increase in severance or termination pay, except as was required under
any Benefit Arrangements in effect as of September 30, 1997, (iii) not
adopt or amend any Plan or Benefit Arrangement (including change any
actuarial or other assumption used to calculate funding obligations
with respect to any Plan, or change the manner in which contributions
to any Plan are made or the basis on which such contributions are
determined) and (iv) except in the ordinary course, not enter into,
amend in any material respect or terminate any Governmental
Authorization, material Private Authorization or Contract, except, for
purposes of this clause (iv) only, as would not, individually or in
the aggregate, be reasonably likely to have a Material Adverse Effect
on ATC;
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(n) not voluntarily take or permit to be taken any action
which if taken between the end of its most recent fiscal quarter and
prior to the date of this Agreement would have been required to be
noted as an exception on Section 4.16 of the ATC Disclosure Schedule,
other than as permitted or not restricted pursuant to the provisions
of this Section 6.7; and
(o) not authorize or enter into any agreement that would
violate any of the foregoing.
6.8 Directors', Officers' and Employees' Indemnification and
Insurance.
(a) The Organic Documents of ATS shall contain provisions
no less favorable with respect to indemnification than are set forth
in the Organic Documents of ATS, as in effect on the date hereof,
which provisions shall not be amended, repealed or otherwise modified
for a period of six (6) years from the Effective Time in any manner
that would affect adversely the rights thereunder of individuals who
at any time prior to the Effective Time were directors, officers or
employees of ATC or any of its Subsidiaries, unless such modification
shall be required by Applicable Law.
(b) From and after the Effective Time, ATS shall indemnify,
defend and hold harmless the present and former officers, directors
and employees of ATC or any of its Subsidiaries (collectively, the
"Indemnified Parties") against all losses, expenses, claims, damages,
liabilities or amounts that are paid in settlement of, or otherwise in
connection with any claim, action, suit, proceeding or investigation
(as used in this Section, a "claim"), based in whole or in part on the
fact that the Indemnified Party (or the Person controlled by the
Indemnified Party) is or was a director, officer or employee of ATC or
any of its Subsidiaries and arising out of actions or omissions
occurring at or prior to the Effective Time (including, without
limitation, in connection with this Agreement, the Merger and the
transactions contemplated hereby), whether asserted or claimed prior
to, at or after the Effective Time, in each case to the fullest extent
permitted under the DCL (and shall pay any expenses, as incurred, in
advance of the final disposition of any such action or proceeding to
each Indemnified Party to the fullest extent permitted under the DCL).
Without limiting the foregoing, in the event any such claim is brought
against any of the Indemnified Parties, (i) such Indemnified Parties
may retain counsel (including local counsel) satisfactory to them and
which shall be reasonably satisfactory to ATS and ATS shall pay all
reasonable fees and expenses of such counsel for such Indemnified
Parties; and (ii) ATS shall use its best efforts to assist in the
defense of any such claim; provided, however, that ATS shall not be
liable for any settlement effected without its written consent, which
consent shall not be unreasonably withheld, delayed or conditioned.
(c) ATS will use its best efforts to cause to be maintained
for a period of not less than six (6) years from the Effective Time a
directors' and officers' insurance and indemnification policy that
provides coverage for events occurring on or prior to the Effective
Time ("D&O Insurance") for all Persons who are directors and officers
of ATC or any of its Subsidiaries on the date of this Agreement, so
long as the annual premium therefor would not be in excess of
$500,000. If any then existing D&O Insurance expires, is terminated or
canceled during such six-year period, ATS will use its best efforts to
cause to be obtained as much D&O Insurance as can be obtained for the
remainder of such period for an annualized premium not in excess of
$500,000, on terms and conditions no less advantageous to the covered
Persons than the then existing D&O Insurance.
(d) In the event ATS or any of their respective successors
or assigns (i) consolidates with or merges into any other person and
shall not be the continuing or surviving corporation or entity of such
consolidation or merger or (ii) transfers all or substantially all of
its properties and assets to any
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person, then and in each such case, proper provisions shall be made so
that the successors and assigns of ATS shall assume the obligations
set forth in this Section.
(e) This Section is intended to be for the benefit of, and
shall be enforceable by, the Indemnified Parties, their heirs and
personal representatives and shall be binding on ATS and its
successors and assigns. ATS shall furnish ATC with a copy of the D&O
insurance complying with the provisions of this Section 6.8 at or
prior to the Closing.
6.9 ATC Employees and Benefit Plans.
(a) Notwithstanding any provision in this Agreement to the
contrary, on or prior to the Closing Date, ATC may (i) take any action
permitted under Paragraph VIII(c) of ATC's 1995 Stock Option Plan with
respect to any or all Option Securities issued and outstanding under
such plan, (ii) accelerate the vesting and exercisability of any or
all of such Option Securities, (iii) amend any or all such Option
Securities to provide that such Option Security shall continue to be
exercisable for its entire stated term without regard to the
employment status or death of the holder of such Option Security, and
(iv) pay bonuses to the employees of ATC and its Subsidiaries in such
amounts as ATC shall determine in its sole discretion; provided,
however, that (A) the aggregate amount of the bonuses paid pursuant to
clause (iv) of this sentence, when added to any fees or expense
reimbursements paid or payable to any financial advisers in connection
with the Merger or related financial advice, shall not exceed $5.0
million (which amount shall not include nor be reduced by any
performance bonuses paid to employees of ATC and its Subsidiaries with
respect to calendar year 1997 on a basis consistent with past
practices), and (B) ATC shall have any action or payment described in
this sentence approved by the stockholders of ATC in accordance with
the provisions of Section 280G(b)(5) of the Code to the extent
necessary to ensure that no actions taken with respect to the
employees of ATC and its Subsidiaries or payments made to such
employees would result in imposition of the sanctions imposed under
Sections 280G and 4999 of the Code. Any bonus paid pursuant to clause
(iv) of the preceding sentence may be paid in cash, by reducing the
purchase price of shares of ATC Common Stock that may be acquired
under an Option Security issued under ATC's 1995 Stock Option Plan, or
any combination of the foregoing. Any actions taken or payments made
by ATC pursuant to the provisions of this Section 6.9(a) may vary
among the individual employees of ATC and its Subsidiaries and may
vary among the Option Securities held by any individual employee, all
as determined by ATC in its sole discretion.
(b) ATS shall take such action as may be necessary so that
at the Effective Time and for twelve (12) months thereafter the
individuals employed by ATC and its Subsidiaries immediately prior to
the Effective Time (the "Continued Employees") shall receive base
compensation (i.e., salary and wages) at a rate that is not less than
that received by such Continued Employees immediately prior to the
Closing Date; provided, however, that the foregoing provisions shall
not impair ATS' ability to terminate any such Continued Employee for
cause. If, within the twelve-month period beginning at the Effective
Time, the employment of any Continued Employee is terminated by ATS or
any of its Subsidiaries other than for cause, or any Continued
Employee is required to accept a material reduction in his or her
title or responsibilities or to transfer to a job location that is
more than thirty-five (35) miles from his or her job location
immediately prior to the Effective Time, but refuses such reduction or
transfer within fifteen (15) days of notice of such reduction or
transfer, then ATS shall continue to pay such Continued Employee his
or her base rate of pay for the balance of such twelve-month period
(without mitigation for any subsequent employment by such continued
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employee). The provisions of this Section 6.9(b) shall not be
applicable with respect to ▇▇▇▇ ▇. ▇▇▇▇▇▇.
(c) ATS shall take such action as may be necessary so that
on and after the Effective Time and for twelve (12) months thereafter,
officers and employees of ATC and its Subsidiaries shall be provided
employee benefits, plans and programs (excluding equity incentive
arrangements) which are no less favorable in the aggregate than those
generally available pursuant to those employee benefit plans and
programs in effect for such officers and employees immediately prior
to the Effective Time; it being understood that ATS shall determine
the types and levels of specific benefits to be so provided. For
purposes of eligibility to participate, vesting and benefit
determinations (other than benefit accruals under any defined benefit
plan) in all benefits provided to officers and employees of ATC and
its Subsidiaries, such officers and employees of ATC and its
Subsidiaries will be credited with their service with ATC and its
Subsidiaries and their respective predecessors. Upon termination of
any health plan of ATC or any of its Subsidiaries, individuals who
were officers or employees of ATC or its Subsidiaries at the Effective
Time shall if employed by ATS or its Subsidiaries become eligible to
participate in such health plans as may be established or maintained
by ATS or its Subsidiaries to the extent that such individuals and
their eligible dependents were eligible to participate in the
applicable health plan of ATC or its Subsidiaries immediately prior to
the Effective Time. Amounts paid during the calendar year in which
such change of coverage occurs by officers and employees of ATC and
its Subsidiaries under any health plans of ATC shall after such change
be taken into account in applying deductible and out-of-pocket limits
applicable under the health plans of ATS or its Subsidiaries provided
during such calendar year to the same extent as if such amounts had
been paid under such health plans of ATS or its Subsidiaries and ATS
shall cause to be waived under its health plans any pre-existing
conditions as of the date of termination of the ATC health plan and
eligibility to participate in such health plan to the extent such
conditions would be waived under the applicable plans of ATC and its
Subsidiaries as in effect on the date hereof. Nothing in this
Agreement shall be construed as granting to any employee of ATC or its
Subsidiaries any rights of continuing employment.
6.10 ATC Stock Options. Prior to the Effective Time, ATS and ATC
shall take such action as may be necessary to cause each unexpired and
unexercised option to purchase ATC Common Stock that is outstanding immediately
prior to the Merger (each, an "ATC Option" and collectively, the "ATC Options")
to be automatically converted at the Effective Time into an option (each, an
"ATS Option" and collectively, the "ATS Options") to purchase a number of shares
of ATS Class A Common Stock equal to the product of the number of shares of ATC
Common Stock which the holder is entitled to purchase under the ATC Option
multiplied by the Exchange Ratio, at a price per share equal to the quotient
obtained by dividing (a) the per share option exercise price determined pursuant
to the ATC Option by (b) the Exchange Ratio. Each ATS Option will otherwise have
the same terms and conditions as the ATC Option exchanged therefor, including
acceleration and period of exercise. At the Effective Time, ATS will execute and
deliver to each holder of an ATS Option a document evidencing ATS' assumptions
of ATC's obligations under the ATC Option and all references in the stock option
agreements to ATC shall be deemed to refer to ATS. As of the Effective Time, ATS
shall assume all of ATC's obligations with respect to the ATC Options as so
amended and shall, from and after the Effective Time, have reserved for issuance
upon exercise of the ATS Options all shares of ATS Class A Common Stock covered
thereby and shall file a Registration Statement on Form S-8 to register the
shares of ATS Class A Common Stock subject to the ATS Options granted in
replacement of ATC Options. ATS shall take all actions reasonably necessary to
maintain the effectiveness of such Registration Statement (and maintain the
current status of the prospectus or prospectuses contained therein) for so long
as such ATS Options remain outstanding. No fractional shares of ATS Class A
Common Stock will be issued upon the
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exercise of any ATS Option, and instead the exercising holder of such ATS Option
shall receive cash for any fractional share amounts, based on the fair market
value of the ATS Class A Common Stock at the time of exercise.
6.11 ATS Voting Agreement. ATS shall use its best efforts to cause
each of the Persons named therein to execute and deliver to ATC an agreement
substantially in the form of Exhibit C attached hereto and made a part hereof
(collectively, the "ATS Voting Agreement").
6.12 Stockholder Approval. ATC will, as soon as practicable following
the date thereof, establish a record date (which will be as soon as practicable
following the date hereof) for, and, after the Registration Statement has become
effective, duly call, give notice of, convene and hold a meeting of its
stockholders (the "ATC Stockholders Meeting") for the purpose of obtaining the
approval and adoption of this Agreement and the approval of the Merger by the
ATC stockholders (the "ATC Stockholder Approval"). ATC will, through its Board
of Directors, recommend to its stockholders approval and adoption of this
Agreement and approval of the Merger.
6.13 Registration Statement and Proxy/Information Statement.
(a) ATS shall prepare and file with the Commission as soon
as is reasonably practicable after the date hereof a Registration
Statement under the Securities Act (the "ATS Registration Statement")
on Form S-4 in connection with the Merger for the purpose of
registering all of the shares of ATS Class A Common Stock to be issued
in the Merger. ATS shall also take any action required under
Applicable Law in connection with causing the ATS Registration
Statement declared effective by the Commission as promptly as
practicable, including without limitation making all filings under
applicable state blue sky or securities laws in connection with the
issuance of ATS Class A Common Stock in the Merger. ATS shall promptly
furnish to each other all information, and take such other actions, as
may reasonably be requested in connection with any action by either of
them in connection with the provisions of this Section.
(b) ATC shall, as soon as is reasonably practicable after
the effectiveness of the ATS Registration Statement, mail notice to
the ATC common stockholders of the ATC Stockholders Meeting. Such
notice shall comply with the provisions of Applicable Law. ATS and ATC
shall promptly furnish to the other all information, and take such
other actions, as may reasonably be requested in connection with any
action taken to comply with the provisions of this Section, including,
in the case of ATS, the final prospectus (the "ATS Prospectus" and,
collectively with the notice furnished to the ATC stockholders in
connection with the ATC Stockholders Meeting, the "ATC Stockholder
Information") contained in the ATS Registration Statement.
(c) Each of ATC and ATS shall correct promptly any
information provided by it to be used specifically in the ATS
Registration Statement and the ATC Stockholder Information that shall
have become false or misleading in any material respect and ATS shall
take all steps necessary to file with the Commission and have cleared
by the Commission any amendment or supplement to the ATS Registration
Statement so as to correct such information and ATS shall cause it to
be disseminated to the ATC stockholders, to the extent required by
Applicable Law. Without limiting the generality of the foregoing, ATS
shall notify ATC promptly of the receipt of the comments of the
Commission and of any request by the Commission for amendments or
supplements to the ATS Registration Statement or the ATS Prospectus,
or for additional information, and shall supply ATC with copies of all
correspondence between it or its representatives, on the one hand, and
the Commission or members
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of its staff, on the other hand, with respect to the ATS Registration
Statement or the ATS Prospectus. Whenever any event occurs which
should be described in an amendment or a supplement to the ATS
Registration Statement or the ATS Prospectus, ATS shall, upon learning
of such event, promptly prepare, file and clear with the Commission
and ATS shall mail to the ATC stockholders such amendment or
supplement; provided, however, that, prior to such mailing, (i) ATS
shall consult with ATC with respect to such amendment or supplement,
(ii) shall afford ATC reasonable opportunity to comment thereon, and
(iii) each such amendment or supplement shall be reasonably
satisfactory to ATC.
(d) ATC shall use its reasonable business efforts to cause
to be delivered to ATS and its directors a letter of independent
auditors, dated (i) the date of the ATS Prospectus Statement, and (ii)
the Closing Date, and addressed to ATS and its directors, in form,
scope and substance customary for letters delivered by independent
public accountants in connection with registrations statements similar
to the ATS Registration Statement.
6.14 Listing of ATS Class A Common Stock. ATS shall use its
reasonable business efforts to effect, at or before the Effective Time,
authorization for listing on Nasdaq (or such stock exchange as ATS shall have
reasonably selected) upon official notice of issuance, of the additional shares
of the ATS Class A Common Stock to be issued pursuant to the Merger; provided,
however, that such efforts shall not require the elimination of the different
voting rights of the classes of ATS Common Stock.
6.15 Solicitation of Employees. If this Agreement is terminated, each
of ATS and ATC agrees that neither it nor any of its Affiliates will, for a
period of eighteen (18) months from the date of such termination, solicit or
actively seek to hire any person who during such period is employed by ATC or
any of its Affiliates or ATS or any of its Affiliates, as the case may be,
whether or not such individual would commit breach of such individual's
employment agreement or contact in leaving such employment; provided, however,
that the foregoing shall not prevent ATS or ATC (or any of its respective
Affiliates) from soliciting or actively seeking to hire any such key employee
who (i) initiates employment discussions with it, (ii) is not employed by ATS or
ATC, as the case may be, on the date ATC or ATS, as the case may be, first
solicits such key employee, or (iii) soliciting through general advertisement.
6.16 Additional Tax Matters.
(a) Except for transactions in the ordinary and usual
course of business, following the date on which, for purposes of
Section 1504 of the Code, ATS ceases to be a member of the "affiliated
group" of corporations of which ARS is the "common parent", ATS shall
not engage in any transaction and shall not permit an of its
Subsidiaries to engage in any transaction that would be treated as an
"intercompany transaction" as defined in Treas. Reg. ss. 1.1502-13.
(b) Each party hereto shall use all reasonable business
efforts to cause the Merger to qualify, and shall not take, and shall
use all reasonable business efforts to prevent any Affiliate of such
party from taking, any action which could prevent the Merger from
qualifying, as a reorganization under the provisions of Section 368(a)
of the Code.
6.17 ATS Registration Rights Agreement. Subject to the satisfaction
(or waiver) of the conditions to closing set forth in (a) Sections 7.1 and 7.2
(the "ATS Conditions"), at or prior to the Closing, ATS shall execute and
deliver a registration rights agreement substantially in the form attached
hereto as Exhibit D and made a part hereof (the "ATS Registration Rights
Agreement") and permit the ATS Registration Statement
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to be executed by such of the ATC stockholders as elect to be so included, and
(b) Sections 7.1 and 7.3 (the "ATC Conditions"), ATC shall use its reasonable
business efforts to cause ATC's two largest stockholders and ▇▇▇▇ ▇. ▇▇▇▇▇▇ to
the extent any of them may be an "affiliate", as that term is used in paragraphs
(c) and (d) of Rule 145 under the Securities Act, of ATS, to execute and deliver
the ATS Registration Rights Agreement.
6.18 Charter Amendment. Subject to the satisfaction (or waiver) of
the ATS Conditions, at or prior to the Closing, ATS shall cause the ATS Restated
Certificate to be approved by the Board of Directors and stockholders of ATS and
to be filed with the Secretary of State of the State of Delaware.
6.19 Conversion of Class B Common Stock. Subject to the satisfaction
(or waiver) of the ATS Conditions, at or prior to the Closing, ATS shall cause
the ATS Class B Common Stock issued to ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ in the ATS Private
Placement to be converted into a like number of shares of ATS Class A Common
Stock to the extent that, after giving effect to the consummation of the Merger,
▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Chairman of the Board and Chief Executive Officer of ATS, would
own more than 49.99% of the voting power of the ATS Common Stock within the
meaning of the ATS Restated Certificate. ATS shall ensure that no ATS Class B
Common Stock is issued in the ATS Private Placement to any Person other than
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, in each case, to the extent permitted by
the provisions of this Section and Section 6.25.
6.20 ATS Separation Agreement. Unless previously entered into and
subject to the satisfaction (or waiver) of the ATS Conditions, at or prior to
the Closing, ATS shall, and shall ARS to, execute and deliver the ATS Separation
Agreement.
6.21 CBS Merger or Tower Distribution Related Actions. Subject to the
satisfaction (or waiver) of the ATS Conditions, at or prior to the Closing, ATS
shall, and shall cause ARS to, use its reasonable business efforts to cause (a)
the CBS Merger to occur, or, if the Tower Distribution is required in order to
satisfy the ATC Conditions, and (b) the Tower Distribution to occur, in each
case, in a manner that does not result in a default in, or with the passage of
time or giving of notice would not result in a default in or violation of any
Material Agreement to which ATS or ARS is a party or by which it is bound or the
Organic Documents of ATS or ARS, including without limitation the ATS Credit
Agreement, the ARS Credit Agreement and the ARS Cumulative Preferred Stock.
6.22 Efforts Regarding Pending Transactions. ATS shall use reasonable
business efforts to cause to be satisfied on or before the Termination Date all
conditions to closing applicable to the Gearon Transaction and the ATS Private
Placement and, upon satisfaction thereof, to consummate such transactions.
6.23 Certain Closing Certificates. ATC shall cause its chief
financial officer to deliver to ATS and its counsel at the Closing a certificate
showing his calculation, in reasonable detail, of the number of shares of ATC
Common Stock determined on a Fully-Diluted Basis immediately prior to the
Effective Time. ATS shall cause its chief financial officer to deliver to ATC
and its counsel at the Closing a certificate showing his calculation, in
reasonable detail, of the number of shares of ATS Common Stock determined on a
Fully-Diluted Basis immediately prior to the Effective Time.
6.24 ATC Affiliates Agreements. ATC shall use its reasonable business
efforts to cause each executive officer, director and other Person who may be an
"affiliate," as that term is used in paragraphs (c) and (d) of Rule 145 under
the Securities Act, of ATC, to have executed and delivered to ATS an agreement
substantially in the form of Exhibit E attached hereto and made a part hereof
(collectively, the "ATC Affiliate Agreements").
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6.25 Issue of ATS Class B Common Stock. Subject to the satisfaction
of the ATS Conditions, ATS shall not issue any shares of Class B Common Stock or
any Convertible Securities convertible or exchangeable into, or Option
Securities to purchase, any shares of ATS Class B Common Stock, except (a) to
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ and, in the event Class B Common Stock shall not have been
distributed pursuant to the Tower Distribution, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ (but, with
respect to ▇▇. ▇▇▇▇▇▇, in a number not more than he holds on the date hereof)
pursuant to the provisions of the ATS Private Placement, (b) Option Securities
issued to the holders of options to purchase Class B Common Stock of ARS, and
(c) upon consummation of the CBS Merger or the Tower Distribution to holders of
Class B Common Stock of ARS. ATS will furnish to ATC, if it has not already done
so, within five (5) business days of this Agreement, a list of the holders of
Class B Common Stock of ARS or of options to purchase Class B Common Stock of
ARS.
6.26 Election of ATS Directors. Subject to the satisfaction of the
ATS Conditions, ATS shall cause ▇▇▇▇ ▇. ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇▇▇▇ to be elected as
members of the Board of Directors of ATS.
6.27 Employee List. Within ten (10) days after the date hereof, ATS
shall furnish ATS with a list of all employees of ARS, ATS or their respective
Subsidiaries that are expected to be employed by the Surviving Company after the
Merger, the office or title of each and the compensation of each.
6.28 Certificates of Non-Foreign Status. Prior to the Closing Date,
ATC shall in respect of the conversion of ATC Common Stock pursuant to the
Merger use its reasonable to obtain on behalf of itself and ATS, from each
person who is a stockholder of ATC immediately prior to the Effective Time, a
certificate of non-foreign status of such stockholder that meets the
requirements of Section 1445 of the Code and Section 1.1445-2(b) of the Treasury
Regulations thereunder, it being understood that the failure to obtain any such
certificate shall not be deemed to be a breach of this Section. ATC shall
furnish to ATS on the Closing Date a copy of such certificates of non-foreign
status.
ARTICLE 7
CLOSING CONDITIONS
7.1 Conditions to Obligations of Each Party. The respective
obligations of each party to effect the Merger shall be subject to the
satisfaction at or prior to the Closing Date of the following conditions, any or
all of which may be waived, in whole or in part, to the extent permitted by
Applicable Law by each party benefitting therefrom:
(a) As of the Closing Date, no temporary restraining order,
preliminary or permanent injunction or other order issued by any court
of competent jurisdiction or other legal restraint or prohibition
preventing the consummation of the Merger shall be in effect;
(b) The waiting period applicable to the consummation of
the Merger and the receipt by each ATC common stockholder of the
Merger Consideration due pursuant thereto, as the case may be, under
the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Act, to the extent applicable, shall have
expired or been terminated;
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(c) The ATS Registration Statement shall have become
effective in accordance with the provisions of the Securities Act and
in accordance with the provisions of Section 6.13, and no stop order
suspending such effectiveness shall have been issued and remain in
effect and no proceeding for that purpose shall have been instituted
by the Commission or any state regulatory authorities and all shares
of ATS Common Stock to be issued to the ATC stockholders pursuant to
the Merger shall be covered by the ATS Registration Statement;
(d) The shares of ATS Class A Common Stock to be issued in
the Merger shall have been approved for listing on Nasdaq (or such
other national stock exchange on which such stock is then approved for
listing), upon official notice of issuance; and
(e) The ATC Stockholder Approval shall have been obtained.
7.2 Conditions to Obligations of ATS. The obligation of ATS to
effect the Merger shall be subject to the satisfaction of the following
conditions, any or all of which may be waived, in whole or in part, by ATS to
the extent permitted by Applicable Law:
(a) ATC shall have furnished ATS and, at ATS' request, any
bank or other financial institution providing credit to ATS, with a
favorable opinion, dated the Closing Date, of ▇▇▇▇▇▇ & ▇▇▇▇▇▇ L.L.P.,
counsel for ATC, substantially in the form attached hereto as Exhibit
F and made a part hereof;
(b) (i) The representations and warranties of ATC set forth
in this Agreement (other than in Section 4.21) shall be true and
correct as of the date hereof and as of the Closing Date as though
made on and as of the Closing Date except (x) to the extent such
representations and warranties expressly speak as of an earlier date
(in which case such representations and warranties shall be true and
correct as of such earlier date) and (y) to the extent that the
failure of such representations and warranties to be true and correct,
individually or in the aggregate, would not have a Material Adverse
Effect on ATC; provided, however, that for the purpose of this clause
(y), representations and warranties that are qualified as to
materiality (including by reference to "Material Adverse Effect")
shall not be deemed to be so qualified; (ii) the representations and
warranties of ATC set forth in Section 4.21 of this Agreement shall be
true and correct; provided, however, such untruth shall be disregarded
for purposes of this Section 7.2(b) if, by adjusting the Exchange
Ratio at Closing, the untruth is rendered harmless and such adjustment
either does not require the approval of the ATC stockholders, or such
approval has been obtained, in accordance with the DCL; (iii) each and
all of the agreements and covenants to be performed or satisfied by
ATC or any of the ATC stockholders hereunder at or prior to the
Closing Date shall have been duly performed or satisfied in all
material respects; and (iv) an executive officer of ATC shall have
furnished ATS with his certificate, confirming, to his knowledge, the
truth of such representations and warranties and the performance of
such covenants and agreements;
(c) There has not occurred any Event (including without
limitation the failure to secure all authorizations, consents,
waivers, orders or approvals required to be obtained by ATC from all
Authorities and other Person, and all filings, submissions,
registrations, notices or declarations required to be made by any of
the parties with any Authority, or the imposition of any condition or
requirement in connection therewith) that has had, or is reasonably
likely to have, a Material Adverse Effect on ATC, other than an Event
affecting the economy or the tower communications business
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generally or an Event that would not have occurred but for the
execution of this Agreement and the announcement of the Merger; and
(d) ATS shall have received from its counsel, ▇▇▇▇▇▇▇▇ &
Worcester LLP, a favorable opinion (dated as of the Closing Date) to
the effect that the Merger constitutes a reorganization within the
meaning of Section 368 of the Code and that, as a consequence, ATS
will not recognize any gain or loss for federal income tax purposes as
a result of consummation of the Merger, and, in connection with such
opinion, ATC and such of its stockholders as such counsel shall have
reasonably requested shall have executed and delivered to ATS and such
counsel a certificate substantially in the form attached hereto as
Exhibit G and made a part hereof.
7.3 Conditions to Obligations of ATC. The obligation of ATC to
effect the Merger shall be subject to the satisfaction of the following
conditions, any or all of which may be waived, in whole or in part, by ATC to
the extent permitted by Applicable Law:
(a) ATS shall have furnished ATC, with favorable opinions,
dated the Closing Date, of ▇▇▇▇▇▇▇▇ & Worcester LLP, counsel for ATS,
substantially in the form attached hereto as Exhibit H and made a part
hereof, and with respect to such other matters arising after the date
of this Agreement and incident to the Merger, as ATC or its counsel
may reasonably request;
(b) (i) The representations and warranties of ATS set forth
in this Agreement (other than in Section 5.20) shall be true and
correct as of the date hereof and as of the Closing Date as though
made on and as of the Closing Date except (x) to the extent such
representations and warranties expressly speak as of an earlier date
(in which case such representations and warranties shall be true and
correct as of such earlier date) and (y) to the extent that the
failure of such representations and warranties to be true and correct,
individually or in the aggregate, would not have a Material Adverse
Effect on ATS; provided, however, that for the purpose of this clause
(y), representations and warranties that are qualified as to
materiality (including by reference to "Material Adverse Effect")
shall not be deemed to be so qualified; (ii) the representations and
warranties of ATS set forth in Section 5.20 of this Agreement shall be
true and correct; provided, however, such untruth shall be disregarded
for purposes of this Section 7.3(b) if, by adjusting the Exchange
Ratio at Closing, the untruth is rendered harmless and such adjustment
either does not require the approval of the ATS or ARS stockholders,
or such approval has been obtained, in accordance with the DCL; (iii)
each and all of the agreements and conditions to be performed or
satisfied by ATS or any of the ATS common stockholders hereunder at or
prior to the Closing Date (including without limitation the execution
and delivery of all collateral documents to be executed and delivered
by it or any of them) shall have been duly performed or satisfied in
all material respects; and (iv) an executive officer of ATS shall have
furnished ATC with his certificate confirming, to his knowledge, the
truth of such representations and warranties and the performance of
such covenants and agreements;
(c) There has not occurred any Event (including without
limitation the failure to secure all authorizations, consents,
waivers, orders or approvals required to be obtained by ATS from all
Authorities and other Person, and all filings, submissions,
registrations, notices or declarations required to be made by any of
the parties with any Authority, or the imposition of any condition or
requirement in connection therewith) that has had, or is reasonably
likely to have, a Material Adverse Effect on ATS, other than an Event
affecting the economy or the tower communications business generally
or an Event that would not have occurred but for the execution of this
Agreement and the announcement of the Merger;
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(d) ATC shall have received evidence of the consummation of
the Gearon Transaction and the ATS Private Placement, all on the terms
and conditions set forth, in the case of the Gearon Transaction, in
the Gearon Merger Agreement, and, in the case of the ATS Private
Placement, on the terms and conditions described in the ATS
Information Statement, or, in either case, on such other terms and
conditions not materially adverse to ATS, including without
limitation, but, in any event, in both cases, the issuance of shares
of ATS Class A Common Stock shall be at a price per share of not less
than $9.00 and, with respect to the ATS Private Placement for a total
purchase price of not less than $80.0 million;
(e) ▇▇▇▇ ▇. ▇▇▇▇▇▇, one of the stockholders of ATC, and
▇▇▇▇▇▇▇ ▇▇▇▇, the Chief Financial Officer of another of the
stockholders of ATC, shall have been elected as directors of ATS;
(f) ATC shall have received from its counsel, ▇▇▇▇▇▇ &
▇▇▇▇▇▇ L.L.P., a favorable opinion (dated as of the Closing Date) to
the effect that the Merger constitutes a reorganization within the
meaning of Section 368 of the Code and that, as a consequence, ATC and
its stockholders will not recognize any gain or loss for federal
income tax purposes as a result of consummation of the Merger, and, in
connection with such opinion, ATS shall have executed and delivered to
ATC and its counsel a certificate substantially in the form of Exhibit
I hereto and made a part hereof; and
(g) Either the CBS Merger shall be consummated on the terms
set forth in the CBS Merger Agreement, including execution and
delivery of the ATS Separation Agreement or the Tower Distribution
shall have occurred.
ARTICLE 8
TERMINATION, AMENDMENT AND WAIVER
8.1 Termination. This Agreement may be terminated at any time prior
to the Closing Date:
(a) by mutual consent of ATC and ATS; or
(b) by either ATS or ATC if any permanent injunction,
decree or judgment by any Authority preventing the consummation of the
Merger shall have become final and nonappealable; or
(c) by ATC in the event (i) ATC is not in breach of this
Agreement and none of its representations or warranties shall have
become and continue to be untrue in a manner that would cause the
condition set forth in Section 7.2(b) not to be satisfied, and (ii)
either (A) the Merger has not been consummated prior to the
Termination Date, or (B) ATS is in breach of this Agreement or any of
its representations or warranties shall have become and continue to be
untrue in a manner that would be reasonably likely to cause the
conditions set forth in Section 7.3(b) not to be satisfied, and such a
breach or untruth exists and is not capable of being cured, by and
will prevent or delay consummation of the Merger by or beyond, the
Termination Date; or
(d) by ATS in the event (i) ATS is not in breach of this
Agreement and none of its representations or warranties shall have
become and continue to be untrue in a manner that would
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cause the condition set forth in Section 7.3(b) not to be satisfied,
and (ii) either (A) the Merger has not been consummated prior to the
Termination Date, or (B) ATC is in breach of this Agreement or any of
ATC's representations or warranties shall have become and continue to
be untrue in a manner that would be reasonably likely to cause the
conditions set forth in Section 7.2(b) not to be satisfied, and such a
breach or untruth exists and is not capable of being cured by, and
will prevent or delay consummation of the Merger by or beyond, the
Termination Date; or
(e) by ATS or ATC in the event (i) the ATC Stockholder
Approval has not been obtained prior to the Termination Date, (ii)
neither the CBS Merger nor the Tower Distribution has occurred prior
to the Termination Date in the manner described in Section 6.21, or
(iii) prior to the Termination Date, any consent or approval from the
ARS stockholders required to satisfy any of the conditions in Article
7 or otherwise to consummate the Merger has not been obtained.
The right of ATS or ATC to terminate this Agreement pursuant to this
Section shall remain operative and in full force and effect regardless of any
investigation made by or on behalf of either party, any Person controlling
either party or any of their respective Representatives whether prior to or
after the execution of this Agreement.
8.2 Effect of Termination.
(a) Except as provided in Sections 6.1 (solely with respect
to confidentiality), 6.3 and 6.15 and this Section and except as
provided in Section 8.2(b), in the event of the termination of this
Agreement pursuant to Section 8.1, or in the event the Merger shall
not have been consummated prior to the end of business on the
Termination Date, except as otherwise provided in this Section, this
Agreement shall forthwith become void, there shall be no liability on
the part of either party, or any of its respective shareholders,
officers or directors, to the other and all rights and obligations of
either party shall cease; provided, however, that such termination
shall not relieve either party from liability for any willful
misrepresentation or willful breach of any of its warranties,
covenants or agreements set forth in this Agreement.
(b) Notwithstanding anything in this Agreement to the
contrary, including without limitation the provisions of Section 9.4,
in the event this Agreement is terminated (a) pursuant to the
provisions of Section 8.1(e)(i), then ATC acknowledges and agrees that
ATS shall be entitled to a termination fee in an amount equal to
$15,000,000, together with the reasonable out of pocket fees and
expenses (including without limitation the reasonable out of pocket
fees and expenses of accountants, attorneys, financial advisors and
printers and all registration and other filing fees), not to exceed
$1,000,000, incurred by ATS in connection with this Agreement and the
Merger, unless ATS has notified ▇▇▇▇ ▇. ▇▇▇▇▇▇ (or the then acting
Chairman of ATC, if not ▇▇. ▇▇▇▇▇▇) or ATC is otherwise actually
aware, at least five (5) business days in advance of the Termination
Date, that the ATS Registration Statement has been declared effective,
in which case ATS shall not be entitled to any termination fee,
expense reimbursement or other payment from ATC, or (b) pursuant to
the provisions of Section 8.1(e)(ii) or (iii), then ATS acknowledges
and agrees that ATC shall be entitled to a termination fee in an
amount equal to $15,000,000, together with the reasonable out of
pocket fees and expenses (including without limitation the reasonable
out of pocket fees and expenses of accountants, attorneys, financial
advisors and printers and all registration and other filing fees), not
to exceed $1,000,000, incurred by ATC in connection with this
Agreement and the Merger. The parties agree that, anything in Section
8.2(a), Section 9.4 or elsewhere in this Agreement to the contrary
notwithstanding, such amount shall be a sole and exclusive remedy and
constitute full
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payment for any and all damages suffered by ATS or ATC, as the case
may be, by reason of the events referred to in the preceding sentence.
ATS and ATC agree in advance that actual damages would be difficult to
ascertain and that such termination fee is a fair and equitable amount
to be paid by ATC or by ATS in order to reimburse the other for
damages sustained due to the failure of the Merger to be consummated
for the above-stated reasons.
ARTICLE 9
GENERAL PROVISIONS
9.1 Waivers; Amendments. Changes in or additions to this Agreement
may be made, or compliance with any term, covenant, agreement, condition or
provision set forth herein may be omitted or waived (either generally or in a
particular instance and either retroactively or prospectively) with, but only
with, the consent in writing of the parties hereto. No delay on the part of
either party at any time or times in the exercise of any right or remedy shall
operate as a waiver thereof. Any consent may be given subject to satisfaction of
conditions stated therein. The failure to insist upon the strict provisions of
any covenant, term, condition or other provision of this Agreement or to
exercise any right or remedy thereunder shall not constitute a waiver of any
such covenant, term, condition or other provision thereof or default in
connection therewith. The waiver of any covenant, term, condition or other
provision thereof or default thereunder shall not affect or alter this Agreement
in any other respect, and each and every covenant, term, condition or other
provision of this Agreement shall, in such event, continue in full force and
effect, except as so waived, and shall be operative with respect to any other
then existing or subsequent default in connection therewith.
9.2 Fees, Expenses and Other Payments. All costs and expenses
incurred in connection with this Agreement and the consummation of the Merger,
including without limitation fees and disbursements of counsel, financial
advisors and accountants incurred by the parties hereto, shall be borne solely
and entirely by the party which has incurred such costs and expenses or which is
responsible therefor under Applicable Law.
9.3 Notices. All notices and other communications which by any
provision of this Agreement are required or permitted to be given shall be given
in writing and shall be deemed to have been delivered (a) three (3) days after
being mailed by first-class or express mail, postage prepaid, (b) the next
business day when sent overnight by recognized courier service, (c) upon
confirmation when sent by telex, telegram, telecopy or other form of rapid
transmission, confirmed by mailing (by first class or express mail, postage
prepaid, or by recognized courier service) written confirmation at substantially
the same time as such rapid transmission, or (d) upon delivery when personally
delivered to the receiving party (which if other than an individual shall be an
officer or other responsible party of the receiving party). All such notices and
communications shall be mailed, sent or delivered as follows:
(a) If to ATS:
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇, Chief Financial Officer
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
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with a copy to:
▇▇▇▇▇▇▇▇ & Worcester LLP
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
(b) If to ATC:
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Chief Financial Officer
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇ & ▇▇▇▇▇▇ L.L.P.
▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
or to such other person(s), telex or facsimile number(s) or address(es) as the
party to receive any such communication or notice may have designated by written
notice to the other party given in accordance with this Section.
9.4 Specific Performance; Other Rights and Remedies. Each party
recognizes and agrees that in the event the other party should refuse to perform
any of its obligations under this Agreement or any Collateral Document, the
remedy at law would be inadequate and agrees that for breach of such provisions,
each party shall, in addition to such other remedies as may be available to it
at law or in equity, except as otherwise provided in Section 8.2(b), be entitled
to injunctive relief and to enforce its rights by an action for specific
performance to the extent permitted by Applicable Law. Each party hereby waives
any requirement for security or the posting of any bond or other surety in
connection with any temporary or permanent award of injunctive, mandatory or
other equitable relief. Except as otherwise provided in Section 8.2, nothing
herein contained shall be construed as prohibiting either party from pursuing
any other remedies available to it pursuant to the provisions of this Agreement
or Applicable Law for a breach by the other party, including without limitation
the recovery of damages, including, to the extent awarded in any Legal Action,
punitive, incidental and consequential damages (including without limitation
damages for diminution in value and loss of anticipated profits) or any other
measure of damages permitted by Applicable Law.
9.5 Severability. If any term or provision of this Agreement shall
be held or deemed to be, or shall in fact be, invalid, inoperative, illegal or
unenforceable as applied to any particular case in any jurisdiction or
jurisdictions, or in all jurisdictions or in all cases, because of the
conflicting of any provision with any constitution or statute or rule of public
policy or for any other reason, such circumstance shall not have the effect of
rendering the provision or provisions in question invalid, inoperative, illegal
or
-49-
unenforceable in any other jurisdiction or in any other case or circumstance or
of rendering any other provision or provisions herein contained invalid,
inoperative, illegal or unenforceable to the extent that such other provisions
are not themselves actually in conflict with such constitution, statute or rule
of public policy, but this Agreement shall be reformed and construed in any such
jurisdiction or case as if such invalid, inoperative, illegal or unenforceable
provision had never been contained herein and such provision reformed so that it
would be valid, operative and enforceable to the maximum extent permitted in
such jurisdiction or in such case. Notwithstanding the foregoing, in the event
of any such determination the effect of which is to affect materially and
adversely either party, the parties shall negotiate in good faith to modify this
Agreement so as to effect the original intent of the parties as closely as
possible to the fullest extent permitted by Applicable Law in an acceptable
manner to the end that the Transactions are fulfilled and consummated to the
maximum extent possible.
9.6 Counterparts. This Agreement may be executed in several
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument, binding upon all of the
parties. In pleading or proving any provision of this Agreement, it shall not be
necessary to produce more than one of such counterparts.
9.7 Section Headings. The headings contained in this Agreement are
for reference purposes only and shall not in any way affect the meaning or
interpretation of this Agreement.
9.8 Governing Law. The validity, interpretation, construction and
performance of this Agreement shall be governed by, and construed in accordance
with, the applicable laws of the United States of America and the laws of the
State of New York applicable to contracts made and performed in such State and,
in any event, without giving effect to any choice or conflict of laws provision
or rule that would cause the application of domestic substantive laws of any
other jurisdiction, except to the extent that the DCL or other laws of the State
of Delaware shall be applicable.
9.9 Further Acts. Each party agrees that at any time, and from time
to time, before and after the consummation of the transactions contemplated by
this Agreement, it will do all such things and execute and deliver all such
Collateral Documents and other assurances, as the other party reasonably deems
necessary or desirable in order to carry out the terms and conditions of this
Agreement and the transactions contemplated hereby or to facilitate the
enjoyment of any of the rights created hereby or to be created hereunder.
9.10 Entire Agreement. This Agreement (together with the ATC
Disclosure Schedule, the ATS Disclosure Schedule, the Exhibits and the other
Collateral Documents delivered or to be delivered in connection herewith)
constitutes the entire agreement of the parties with respect to the subject
matter hereof and supersedes all prior agreements, arrangements, covenants,
promises, conditions, undertakings, inducements, representations, warranties and
negotiations, expressed or implied, oral or written, between the parties, with
respect to the subject matter hereof. Each of the parties is a sophisticated
legal entity that was advised by experienced counsel and, to the extent it
deemed necessary, other advisors in connection with this Agreement. Each of the
parties hereby acknowledges that (a) neither of the parties has relied or will
rely in respect of this Agreement or the transactions contemplated hereby upon
any document or written or oral information previously furnished to or
discovered by it or its representatives, other than this Agreement (or such of
the foregoing as are delivered at the Closing, (b) there are no covenants or
agreements by or on behalf of either party or any of its respective Affiliates
or representatives other than those expressly set forth in this Agreement and
the Collateral Documents, and (c) the parties' respective rights and obligations
with respect to this Agreement and the events giving rise thereto will be solely
as set forth in this Agreement and the Collateral Documents. WITHOUT LIMITING
THE GENERALITY OF THE FOREGOING, EACH PARTY
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HERETO AGREES THAT, EXCEPT FOR THE REPRESENTATIONS AND WARRANTIES CONTAINED IN
THIS AGREEMENT, NEITHER OF THE PARTIES MAKES ON BEHALF OF ITSELF AND ITS
DIRECTORS, OFFICERS, STOCKHOLDERS AND OTHER AFFILIATES ANY OTHER REPRESENTATIONS
OR WARRANTIES, AND EACH HEREBY DISCLAIMS ON BEHALF OF ITSELF AND ITS OFFICERS,
DIRECTORS, STOCKHOLDERS AND OTHER AFFILIATES ANY OTHER REPRESENTATIONS OR
WARRANTIES MADE BY ITSELF OR ANY OF ITS OFFICERS, DIRECTORS, EMPLOYEES, AGENTS,
FINANCIAL AND LEGAL ADVISORS OR OTHER REPRESENTATIVES, WITH RESPECT TO THE
EXECUTION AND DELIVERY OF THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY, NOTWITHSTANDING THE DELIVERY OR DISCLOSURE TO THE OTHER OR THE OTHER'S
REPRESENTATIVES OF ANY DOCUMENTATION OR OTHER INFORMATION WITH RESPECT TO ANY
ONE OR MORE OF THE FOREGOING.
9.11 Assignment. This Agreement shall not be assignable by either
party and any such assignment shall be null and void, except that it shall inure
to the benefit of and by binding upon any successor to either party by operation
of law, including by way of merger, consolidation or sale of all or
substantially all of its assets.
9.12 Parties in Interest. This Agreement shall be binding upon and
inure solely to the benefit of each party, and nothing in this Agreement,
express or implied, is intended to or shall confer upon any Person any right,
benefit or remedy of any nature whatsoever under or by reason of this Agreement,
except as otherwise provided in Sections 6.8, 6.9(b), 6.9(c), 6.10 and 8.11.
9.13 Non-Survival of Representations, Warranties, Covenants and
Agreements. Except for damages or other remedies attributable to or based upon
fraud, willful or intentional misrepresentation or willful or intentional breach
of warranty, covenant or agreement, none of the representations, warranties,
covenants and agreements in this Agreement shall survive the Merger, and after
effectiveness of the Merger neither party nor any of its respective officers,
directors or stockholders shall have any further obligation with respect
thereto. This Section shall not limit any covenant or agreement of the parties
which by its terms contemplates performance after the Effective Time.
9.14 Mutual Drafting. This Agreement is the result of the joint
efforts of the parties, and each provision hereof has been subject to the mutual
consultation, negotiation and agreement of the parties and there shall be no
construction against either party based on any presumption of that party's
involvement in the drafting thereof.
[SIGNATURES APPEAR ON FOLLOWING PAGE]
-51-
IN WITNESS WHEREOF, the parties have executed or caused this Agreement
to be executed by their respective officers thereunto duly authorized as of the
date first written above.
American Tower Systems Corporation
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Chief Financial Officer
American Tower Corporation
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: President
-52-
APPENDIX A
DEFINITIONS
Affiliate, Affiliated shall mean, with respect to any Person, (a) any
other Person at the time directly or indirectly controlling, controlled by or
under direct or indirect common control with such Person, (b) any other Person
of which such Person at the time owns, or has the right to acquire, directly or
indirectly, ten percent (10%) or more of any class of the capital stock or
beneficial interest, (c) any other Person which at the time owns, or has the
right to acquire, directly or indirectly, ten percent (10%) or more of any class
of the capital stock or beneficial interest of such Person, (d) any executive
officer or director of such Person, (e) with respect to any partnership, joint
venture or similar Entity, any general partner thereof, and (f) when used with
respect to an individual, shall include any member of such individual's
immediate family or a family trust.
Agreement shall mean this Agreement as originally in effect,
including, unless the context otherwise specifically requires, this Appendix A,
the ATC Disclosure Schedule, the ATS Disclosure Schedule and all exhibits
hereto, and as any of the same may from time to time be supplemented, amended,
modified or restated in the manner herein or therein provided.
Aggregate Merger Shares shall mean the number obtained by solving the
following equation for "x":
x = (.5384615) multiplied by y, where "y" is the number of
shares of ATS Common Stock determined on a Fully-Diluted
Basis immediately prior to the Effective Time. Thus, in the
event there were no Dissenting Shares, the number of
Aggregate Merger Shares would equal 35% of the sum of the
Aggregate Merger Shares and the number of shares of ATS
Common Stock determined on a Fully-Diluted Basis.
Alternative Transaction shall mean, with respect to any Person, a
transaction or series of related transactions (other than the Transactions)
resulting in or reasonably likely to result in (i) any change of control of such
Person, (ii) any merger, consolidation or other business combination of such
Person, regardless of whether such Person is the surviving Entity unless the
surviving Entity remains obligated under this Agreement to the same extent as
such Person was, (iii) any tender offer or exchange offer for, or any
acquisitions of, any securities of such Person, (iv) any sale or other
disposition of all or any substantial part of the assets or business of such
Person, (v) any issue or sale, or any agreement to issue or sell, any capital
stock, Convertible Securities, Option Securities or other equity securities by
such Person, or (vi) any issue, sale, transfer, pledge, assignment or other
conveyance or any agreement to issue, sell, transfer, pledge, assign or
otherwise convey, any capital stock, such Convertible Securities, Option
Securities or other equity securities of such Person.
Applicable Law shall mean any Law of any Authority, whether domestic
or foreign, including without limitation the FCA and all federal and state
securities and Environmental Laws, to which a Person is subject or by which it
or any of its business or operations is subject or any of its property or assets
is bound.
ARS shall have the meaning given to it in the fourth Whereas
paragraph.
ARS Credit Agreements shall mean the two credit agreements of ARS with
its lending banks and other financial institutions.
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ARS Cumulative Preferred Stock shall mean the 11 3/8% Cumulative
Exchangeable Preferred Stock, par value $.01 per share, of ARS.
ARS Preferred Certificate shall have the meaning given to it in
Section 5.23(b).
ATC shall have the meaning given to it in the Preamble.
ATC Affiliate Agreements shall have the meaning given to it in Section
6.24.
ATC Assets shall have the meaning given to it in Section 4.4(a).
ATC Business shall have the meaning given to it in Section 4.4(a).
ATC Business Description shall mean the business description of ATC
set forth in the ATS Prospectus.
ATC Common Stock shall have the meaning given to it in Section 3.1(b).
ATC Conditions shall have the meaning given to it in Section 6.17.
ATC Disclosure Schedule shall mean the ATC Disclosure Schedule dated
as of the date of this Agreement delivered by ATC to ATS.
ATC Employees shall have the meaning given it in Section 4.14.
ATC Financial Statements shall have the meaning given to it in Section
4.2.
ATC Governmental Authorizations shall have the meaning given to it in
Section 4.6(a).
ATC Option(s) shall have the meanings given to those terms in Section
6.10.
ATC Preferred Stock shall have the meaning given to it in Section
3.1(d).
ATC Private Authorization(s) shall have the meaning given to it in
Section 4.5.
ATC Required Vote shall have the meaning given to it in Section 4.21.
ATC Share(s) shall have the meanings given to them in Section 3.1(b).
ATC Stockholder Approval shall have the meaning given to it in Section
6.12.
ATC Stockholder Information shall have the meaning given to it in
Section 6.13(b)
ATC Stockholders Meeting shall have the meaning given to it in Section
6.12.
ATC's knowledge (or words of similar import) shall mean the actual
knowledge of ATC or any ATC director or officer, as such knowledge exists on the
date of this Agreement, after reasonable review of appropriate ATC records and
after reasonable inquiry of appropriate ATC employees.
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ATS shall have the meaning given to it in the Preamble.
ATS Assets shall have the meaning given to it in Section 5.4(a).
ATS Business shall have the meaning given to it in Section 5.4(a).
ATS Existing Restated Certificate shall have the meaning given to it
in Section 2.5.
ATS Class A Common Stock shall have the meaning given to it in Section
3.1(b).
ATS Class B Common Stock shall mean the Class B Common Stock, par
value $.01 per share, of ATS.
ATS Common Stock shall have the meaning given to it in Section 3.1(b).
ATS Conditions shall have the meaning given to it in Section 6.17.
ATS Disclosure Schedule shall mean the ATS Disclosure Schedule dated
as of the date of this Agreement delivered by ATS to ATC.
ATS Employees shall have the meaning given it in Section 5.13.
ATS Financial Statements shall have the meaning given to it in Section
5.2
ATS Governmental Authorizations shall have the meaning given to it in
Section 5.6(a)
ATS Information Statement shall mean the Information Statement draft,
dated December 12, 1997, describing the business of ATS and certain other
matters heretofore delivered by ATS to ATC.
ATS' knowledge (or words of similar import) shall mean the actual
knowledge of any director or executive officer of ATS, as such knowledge exists
on the date of this Agreement, after reasonable review of appropriate ATS
records and after reasonable inquiry of appropriate ATS employees.
ATS Noncompetition Agreements shall have the meaning given to it in
Section 7.2(i).
ATS Option(s) shall have the meanings given to those terms in Section
6.10.
ATS Private Authorizations shall have the meaning given to it in
Section 5.5.
ATS Private Placement shall mean the issue and sale by ATS of shares
of ATS Class A Common Stock to certain officers and directors of ATS (or their
Affiliates) for an aggregate consideration of not more than $80.0 million, at a
per share price of not less than $9.00, all as described in the ATS Information
Statement.
ATS Prospectus shall have the meaning given to it in Section 6.13(b).
ATS Registration Rights Agreement shall have the meaning given to it
in Section 6.17.
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ATS Registration Statement shall have the meaning given to it in
Section 6.13(a).
ATS Restated Certificate shall have the meaning given to it in Section
2.5.
ATS Separation Agreement shall mean the agreement referred to in
Section 6.17 of the CBS Merger Agreement and which shall incorporate the
provisions of Section 6.17, 6.18 and 6.19 of the CBS Merger Agreement as they
exist on the date hereof or as they may be amended in a manner that does not
increase materially the obligations and liabilities of ATS.
ATS Voting Agreement shall have the meaning give to it in Section
6.11.
ATSI shall mean American Tower Systems, Inc., a Delaware corporation
which is wholly-owned by ATS and which conducts directly or through Subsidiaries
substantially all of the ATS Business and owns directly or through Subsidiaries
substantially all of the ATS Assets.
Authority shall mean any governmental or quasi-governmental authority,
whether administrative, executive, judicial, legislative or other, or any
combination thereof, including without limitation any federal, state,
territorial, county, municipal or other government or governmental or quasi-
governmental agency, arbitrator, authority, board, body, branch, bureau, or
comparable Person, whether domestic or foreign, including without limitation the
FCC.
Benefit Arrangement shall mean, with respect to any Person, any
material benefit arrangement that is not a Plan, including (a) any employment or
consulting agreement, (b) any arrangement providing for insurance coverage or
workers' compensation benefits, (c) any incentive bonus or deferred bonus
arrangement, (d) any arrangement providing termination allowance, severance or
similar benefits, (e) any equity compensation plan, (f) any deferred
compensation plan, and (g) any compensation policy and practice, but only to the
extent that it covers or relates to any officer, employee, individual or Entity
involved in the ownership and operation of the assets of such Person or the
conduct of the business of such Person.
CBS Merger shall mean the merger of R Acquisition Corp. ("CBS Sub"), a
Delaware subsidiary wholly-owned by CBS Corporation (formerly Westinghouse
Electric Corporation), a Pennsylvania corporation ("CBS"), with and into ARS, on
the terms set forth in an Agreement and Plan of Merger, dated as of September
19, 1997, by and among ARS, CBS and CBS Sub, as the same has heretofore been
amended or as it may from time to time be hereafter amended, modified,
supplemented and restated in a manner that does not increase materially the
obligations and liabilities of ATS (as so amended, modified, supplemented and
restated, the "CBS Merger Agreement").
Certificate shall have the meaning given to it in Section 3.1(i).
Certificate of Merger shall have the meaning given to it in Section
2.3.
Claims shall mean any and all debts, liabilities, obligations, losses,
damages, deficiencies, assessments and penalties, together with all Legal
Actions, pending or threatened, claims and judgments of whatever kind and nature
relating thereto, and all fees, costs, expenses and disbursements (including
without limitation reasonable attorneys' and other legal fees, costs and
expenses) relating to any of the foregoing.
Closing shall have the meaning given to it in Section 2.2.
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Closing Date shall have the meaning given to it in Section 2.2.
COBRA shall mean the Consolidated Omnibus Budget Reconciliation Act of
1985, as amended, as set forth in Section 4980B of the Code and Part 6 of
Subtitle B of Title I of ERISA.
Code shall mean the Internal Revenue Code of 1986, and the rules and
regulations thereunder, all as from time to time in effect, or any successor
law, rules or regulations, and any reference to any statutory or regulatory
provision shall be deemed to be a reference to any successor statutory or
regulatory provision.
Collateral Documents shall mean the ATC Affiliate Agreements, the ATS
Information Statement, the ATS Prospectus, the ATS Registration Rights
Agreement, the ATS Registration Statement, the ATS Restated Certificate, the ATS
Voting Agreement, the Certificate of Merger and any other agreement,
certificate, contract, instrument, notice, opinion or other document delivered
pursuant to the provisions of this Agreement.
Commission shall mean the Securities and Exchange Commission and shall
include any successor Authority.
Confidential Information shall have the meaning given to it in Section
6.1(a).
Continued Employees shall have the meaning given to it in Section
6.9(b).
Contract, Contractual Obligation shall mean, with respect to any
Person, any agreement, arrangement, commitment, contract, covenant, indemnity,
undertaking or other obligation or liability which involves the ownership or
operation of the assets of such Person or the conduct of the business of such
Person.
Control (including the terms "controlled," "controlled by" and "under
common control with") means the possession, directly or indirectly or as trustee
or executor, of the power to direct or cause the direction of the management or
policies of a Person, or the disposition of such Person's assets or properties,
whether through the ownership of stock, equity or other ownership, by contract,
arrangement or understanding, or as trustee or executor, by contract or credit
arrangement or otherwise.
Convertible Securities shall mean any evidences of indebtedness,
shares of capital stock (other than common stock) or other securities directly
or indirectly convertible into or exchangeable for shares of common stock,
whether or not the right to convert or exchange thereunder is immediately
exercisable or is conditioned upon the passage of time, the occurrence or non-
occurrence or existence or non-existence of some other Event, or both.
DCL shall have the meaning given to it in Section 2.1.
Distribution shall mean, with respect to any Person, (a) the
declaration or payment of any dividend (except dividends payable in common stock
of such Person) on or in respect of any shares of any class of capital stock of
such Person or any shares of capital stock of any Subsidiary owned by a Person
other than such Person or a Subsidiary, (b) the purchase, redemption or other
retirement of any shares of any class of capital stock of such Person or any
shares of capital stock of any Subsidiary of such Person owned by a Person other
than such Person or a Subsidiary of such Person, and (c) any other distribution
on or in respect of any shares of any class of capital stock of such Person or
any shares of capital stock of any Subsidiary of such Person owned by a Person
other than such Person or a Subsidiary of such Person.
D&O Questionnaire shall have the meaning given to it in Section
6.8(c).
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Effective Time shall have the meaning given to it in Section 2.3.
Employment Arrangement shall mean, with respect to any Person, any
employment, consulting, retainer, severance or similar contract, agreement,
plan, arrangement or policy (exclusive of any which is terminable within thirty
(30) days without liability, penalty or payment of any kind by such Person or
any Affiliate), or providing for severance, termination payments, insurance
coverage (including any self-insured arrangements), workers compensation,
disability benefits, life, health, medical, dental or hospitalization benefits,
supplemental unemployment benefits, vacation or sick leave benefits, pension or
retirement benefits or for deferred compensation, profit-sharing, bonuses, stock
options, stock purchase or appreciation rights or other forms of incentive
compensation or post-retirement insurance, compensation or post-retirement
insurance, compensation or benefits, or any collective bargaining or other labor
agreement, whether or not any of the foregoing is subject to the provisions of
ERISA, but only to the extent that it covers or relates to any officer, employee
or other Person involved in the ownership or operation of the assets or the
conduct of the business of such Person.
Encumber shall mean to suffer, accept, agree to or permit the
imposition of a Lien.
Entity shall mean any corporation, firm, unincorporated organization,
association, partnership, limited liability company, trust (inter vivos or
testamentary), estate of a deceased, insane or incompetent individual, business
trust, joint stock company, joint venture or other organization, entity or
business, whether acting in an individual, fiduciary or other capacity, or any
Authority.
Environmental Law shall mean any Law relating to or otherwise imposing
liability or standards of conduct concerning pollution or protection of the
environment, including without limitation Laws relating to emissions,
discharges, releases or threatened releases of Hazardous Materials or other
chemicals or industrial pollutants, substances, materials or wastes into the
environment (including, without limitation, ambient air, surface water, ground
water, mining or reclamation or mined land, land surface or subsurface strata)
or otherwise relating to the manufacture, processing, generation, distribution,
use, treatment, storage, disposal, cleanup, transport or handling of pollutants,
contaminants, chemicals or industrial, toxic or hazardous substances, materials
or wastes. Environmental Laws shall include without limitation the Comprehensive
Environmental Response, Compensation and Liability Act (42 U.S.C. Section 6901
et seq.), the Hazardous Material Transportation Act (49 U.S.C. Section 1801 et
seq.), the Resource Conservation and Recovery Act (42 U.S.C. Section 6901 et
seq.), the Federal Water Pollution Control Act (33 U.S.C. Section 1251 et seq.),
the Clean Air Act (42 U.S.C. Section 7401 et seq.), the Toxic Substances Control
Act (15 U.S.C. Section 2601 et seq.), the Occupational Safety and Health Act (29
U.S.C. Section 651 et seq.), the Federal Insecticide Fungicide and Rodenticide
Act (7 U.S.C. Section 136 et seq.), and the Surface Mining Control and
Reclamation Act of 1977 (30 U.S.C. Section 1201 et seq.), and any analogous
federal, state, local or foreign, Laws, and the rules and regulations
promulgated thereunder as in effect on the date hereof or on the Closing Date,
as applicable, and any reference to any statutory or regulatory provision shall
be deemed to be a reference to any successor statutory or regulatory provision.
Environmental Permit shall mean any Governmental Authorization
required by or pursuant to any Environmental Law.
ERISA shall mean the Employee Retirement Income Security Act of 1974,
and the rules and regulations thereunder, all as from time to time in effect, or
any successor law, rules or regulations, and any reference to any statutory or
regulatory provision shall be deemed to be a reference to any successor
statutory or regulatory provision.
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ERISA Affiliate shall mean, with respect to any Person, any individual
or Entity that is treated as a single employer with such Person under Sections
414(b), (c), (m) or (o) of the Code or Section 4001(b)(1) of ERISA.
Event shall mean the existence or occurrence of any act, action,
activity, circumstance, condition, event, fact, failure to act, omission,
incident or practice, or any set or combination of any of the foregoing.
Exchange Act shall mean the Securities Exchange Act of 1934, and the
rules and regulations thereunder, all as from time to time in effect, or any
successor law, rules or regulations, and any reference to any statutory or
regulatory provision shall be deemed to be a reference to any successor
statutory or regulatory provision.
Exchange Ratio shall have the meaning given to it in Section 3.1(b).
FCA shall mean the Communications Act of 1934, and the rules and
regulations thereunder, all as from time to time in effect, or any successor
law, rules or regulations, and any reference to any statutory or regulatory
provision shall be deemed to be a reference to any successor statutory or
regulatory provision.
FCC shall mean the Federal Communications Commission and shall include
any successor Authority.
Final Order shall mean, with respect to any Authority, including
without limitation the FCC, one with respect to which no appeal, no stay, no
petition or application for rehearing, reconsideration, review or stay, whether
on motion of the applicable Authority or other Person or otherwise, and no other
Legal Action contesting such consent or approval, is in effect or pending and as
to which the time or deadline for filing any such appeal, petition or
application or other Legal Action has expired or, if filed, has been denied,
dismissed or withdrawn, and the time or deadline for instituting any further
Legal Action has expired.
Fully-Diluted Basis shall mean, when applied to the ATC Common Stock
or the ATS Common Stock, the total number of shares of the issuer of such stock
that are outstanding as of the date of determination plus, without duplication,
the total number of all shares issuable in respect of securities convertible
into or exchangeable for ATC Common Stock or ATS Common Stock (excluding the ATS
Common Stock that may be issued upon exchange of membership interests issued in
Communications System Development, LLC, but including in both Convertible
Securities), as the case may be, or issuable upon exercise of stock appreciation
rights or options, warrants and other irrevocable rights to purchase or
subscribe for ATC Common Stock or ATS Common Stock, as the case may be,
including Option Securities. Without limiting the foregoing, the parties agree
that, if the Tower Distribution occurs before the CBS Merger, the term "Fully-
Diluted Basis" would take into account any Convertible Securities or Option
Securities that ATS or the Surviving Corporation may be required to issue upon
consummation of the Merger.
GAAP shall mean generally accepted accounting principles applied on a
consistent basis, (i) as set forth in Opinions of the Accounting Principles
Board of the American Institute of Certified Public Accountants ("AICPA") and/or
in statements of the Financial Accounting Standards Board that are applicable in
the circumstances as of the date in question, and (ii) when not inconsistent
with such opinions and statements, as set forth in other AICPA publications and
guidelines that otherwise arise by custom for the particular industry, all as
the same shall exist on the date of this Agreement.
Gearon Transaction shall mean the merger of Gearon & Co., Inc., a
Georgia corporation ("Gearon"), with and into ATSI, pursuant to an Agreement and
Plan of Merger (the "Gearon Merger Agreement"), dated
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as of November 21, 1997, by and among ATS, ATSI, Gearon and J. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇., as the same has may from time to time be hereafter amended, modified,
supplemented and restated in a manner which would not have any significant
adverse effect on ATS (as so amended, modified, supplemented and restated, the
"Gearon Merger Agreement").
Governmental Authorizations shall mean, with respect to any Person,
all approvals, concessions, consents, franchises, licenses, permits, plans,
registrations and other authorizations of all Authorities, including without
limitation the United States Forest Service and the Federal Aviation
Administration, in connection with the ownership or operation of the assets or
the conduct of the business of such Person.
Governmental Filings shall mean all filings, including franchise and
similar Tax filings, and the payment of all fees, assessments, interest and
penalties associated with such filings, with all Authorities.
▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Act shall mean the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Improvement Act
of 1976, as from time to time in effect, or any successor law, and any reference
to any statutory provision shall be deemed to be a reference to any successor
statutory provision.
Hazardous Materials shall mean and include any substance, material,
waste, constituent, compound, chemical, natural or man-made element (in whatever
state of matter): (a) the presence of which requires investigation or
remediation under any Environmental Law, (b) that is defined as a "hazardous
waste" or "hazardous substance" under any Environmental Law; (c) that is toxic,
explosive, corrosive, etiologic, flammable, infectious, radioactive,
carcinogenic, mutagenic or otherwise hazardous and is regulated by any
applicable Authority pursuant to any Environmental Law; (d) the presence of
which on the real property owned or leased by such Person causes or threatens to
cause a nuisance upon any such real property or to adjacent properties or poses
or threatens to pose a hazard to the health or safety of persons on or about any
such real property; or (e) that contains gasoline, diesel fuel or other
petroleum hydrocarbons, or any by-products or fractions thereof, natural gas,
polychlorinated biphenyls ("PCBs") and PCB-containing equipment, radioactive
material, lead, asbestos or asbestos-containing materials, or urea formaldehyde
foam insulation.
Indebtedness shall mean, with respect to any Person, (a) all items,
except items of capital stock or of surplus or of general contingency or
deferred tax reserves or any minority interest in any Subsidiary of such Person
to the extent such interest is treated as a liability with indeterminate term on
the consolidated balance sheet of such Person, which in accordance with GAAP
would be included in determining total liabilities as shown on the liability
side of a balance sheet of such Person, (b) all obligations secured by any Lien
to which any property or asset owned or held by such Person is subject, whether
or not the obligation secured thereby shall have been assumed, and (c) to the
extent not otherwise included, all Contractual Obligations of such Person
constituting capitalized leases and all obligations of such Person with respect
to Leases constituting part of a sale and leaseback arrangement.
Indebtedness for Money Borrowed shall mean, with respect to any
Person, money borrowed and Indebtedness represented by notes payable and drafts
accepted representing extensions of credit, all obligations evidenced by bonds,
debentures, notes or other similar instruments, the maximum amount currently or
at any time thereafter available to be drawn under all outstanding letters of
credit issued for the account of such Person, all Indebtedness upon which
interest charges are customarily paid by such Person, and all Indebtedness
(including capitalized lease obligations and purchase money Indebtedness) issued
or assumed as full or partial payment for property or services, whether or not
any such notes, drafts, obligations or Indebtedness represent Indebtedness for
Money Borrowed, but shall not include (a) trade payables, (b) expenses accrued
in the ordinary course of business, (c) customer advance payments and customer
deposits
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received in the ordinary course of business, or (d) conditional sales agreements
not prohibited by the terms of this Agreement.
Indemnified Party shall have the meaning given to it in Section
6.8(b).
Intangible Assets shall mean all assets and property lacking physical
properties the evidence of ownership of which must customarily be maintained by
independent registration, documentation, certification, recordation or other
means, and shall include, without limitation, concessions, copyrights,
franchises, license, patents, permits, service marks, trademarks, trade names,
and applications with respect to any of the foregoing, technology and know-how.
Law shall mean any (a) administrative, judicial, legislative or other
action, code, consent decree, constitution, decree, directive, enactment,
finding, law, injunction, interpretation, judgment, order, ordinance, policy
statement, proclamation, promulgation, regulation, requirement, rule, rule of
law, rule of public policy, settlement agreement, statute, or writ of any
Authority, domestic or foreign; (b) the common law, or other legal precedent; or
(c) arbitrator's, mediator's or referee's award, decision, finding or
recommendation.
Lease shall mean any lease of property, whether real, personal or
mixed, and all amendments thereto.
Legal Action shall mean, with respect to any Person, any and all
litigation or legal or other actions, arbitrations, counterclaims,
investigations, proceedings, requests for material information by or pursuant to
the order of any Authority or suits, at law or in arbitration, equity or
admiralty, whether or not purported to be brought on behalf of such Person,
affecting such Person or any of such Person's business, property or assets.
Lien shall mean any of the following: mortgage; lien (statutory or
other); or other security agreement, arrangement or interest; hypothecation,
pledge or other deposit arrangement; assignment; charge; levy; executory
seizure; attachment; garnishment; encumbrance (including any easement,
exception, reservation or limitation, right of way, and the like); conditional
sale, title retention or other similar agreement, arrangement, device or
restriction; preemptive or similar right; any financing lease involving
substantially the same economic effect as any of the foregoing; the filing of
any financing statement under the Uniform Commercial Code or comparable law of
any jurisdiction; restriction on sale, transfer, assignment, disposition or
other alienation; or any option, equity, claim or right of or obligation to, any
other Person, of whatever kind and character.
Material Adverse Effect shall mean, with respect to ATC or ATS, any
Event which is reasonably likely, in the reasonable business judgment of the
relevant party, to be expected to (a) materially and adversely affect the
validity or enforceability of this Agreement or the likelihood of consummation
of the Merger, or (b) materially and adversely affect the business, operations,
management, properties or prospects, or the condition, financial or other, or
results of operation of ATC and its Subsidiaries taken as a whole or ATS and its
Subsidiaries taken as a whole, as applicable, or (c) materially impair ATC's or
ATS' ability to fulfill its obligations under the terms of this Agreement, or
(d) materially and adversely affect the aggregate rights and remedies of the
other party (other under this Agreement. Notwithstanding the foregoing, and
anything in this Agreement to the contrary notwithstanding, any Event generally
affecting the economy or the tower communications business shall not be deemed
to have a Material Adverse Effect.
Material Agreement shall mean, with respect to any Person, any
Contractual Obligation (other than Contractual Obligations under Contracts
governing the lease or rental of tower spaces to third-party
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customers) which (a) involves the purchase, sale or lease of goods or materials,
or purchase of services, whether in or outside of the ordinary course of
business (including, without limitation, acquisitions of communications towers
or tower businesses), that individually involves a purchase price in excess of
$2,000,000, (b) involves a capitalized lease obligation or Indebtedness for
Money Borrowed in excess of $1,000,000, (c) involves a written agency, broker,
dealer, license, distributorship, sales representative or similar written
agreement pursuant to which such Person or its Subsidiaries made payments in
excess of $1,000,000 during the preceding twelve-month period, (d) accounted for
more than 3% of the revenues of the business of such Person in any of the three
fiscal years or is likely to account for more than 3% of the revenues of the
business of such Person during the current fiscal year, (e) involves the
management by such Person of more than ten (10) communication towers for any
other Person, (f) is a partnership, limited liability company or other joint
venture, (g) grants any Person the exclusive right to represent ATS and its
Subsidiaries of ATC and its Subsidiaries, as the case may be, with respect to
brokering tower transactions, or marketing tower space or administering tower or
(h) limits the freedom to compete in any line of business or to conduct business
in any geographic location.
Merger shall have the meaning given to it in the first Whereas
paragraph.
Merger Consideration shall have the meaning given to it in Section
3.1(b).
Multiemployer Plan shall mean a Plan which is a "multiemployer plan"
within the meaning of Section 3(37) or 4001(a)(3) of ERISA.
Nasdaq shall have the meaning given to it in Section 3.1.
Option Securities shall mean all rights, options and warrants, and
calls or commitments evidencing the right, to subscribe for, purchase or
otherwise acquire shares of capital stock or Convertible Securities, whether or
not the right to subscribe for, purchase or otherwise acquire is immediately
exercisable or is conditioned upon the passage of time, the occurrence or non-
occurrence or the existence or non-existence of some other Event.
Organic Document shall mean, with respect to a Person which is a
corporation, its charter, its by-laws and all shareholder agreements, voting
trusts and similar arrangements applicable to any of its capital stock and, with
respect to a Person which is a partnership, its agreement and certificate of
partnership, any agreements among partners, and any management and similar
agreements between the partnership and any general partners (or any Affiliate
thereof).
Permitted Liens shall mean (a) Liens for current taxes not yet due and
payable, (b) such imperfections of title, easements, encumbrances and mortgages
or other Liens, if any, as, individually or in the aggregate, do not materially
detract from the value, or materially interfere with the present use, of the ATC
Assets or the ATS Assets, as the case may be, or otherwise materially impair the
conduct of the ATC Business or the ATS Business, as the case may be, and (c)
such other Liens as are permitted by the provisions of this Agreement to be in
place on the Closing Date.
Person shall mean any natural individual or any Entity.
Plan shall mean, with respect to any Person and at a particular time,
any employee benefit plan which is covered by ERISA and in respect of which such
Person or an ERISA Affiliate is (or, if such plan were
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terminated at such time, would under Section 4069 of ERISA be deemed to be) an
"employer" as defined in Section 3(5) of ERISA, but only to the extent that it
covers or relates to any officer, employee, individual or Entity involved in the
ownership and operation of the assets of such Person or the conduct of the
business of such Person.
Preferred Stock Merger consideration shall have the meaning given to
it in Section 3.1(d).
Private Authorizations shall mean all approvals, concessions,
consents, franchises, licenses, permits, and other authorizations of all Persons
(other than Authorities) including without limitation those with respect to
Intangible Assets.
Regulations shall mean the federal income tax regulations promulgated
under the Code, as such Regulations may be amended from time to time. All
references herein to specific sections of the Regulations shall be deemed also
to refer to any corresponding provisions of succeeding Regulations, and all
references to temporary Regulations shall be deemed also to refer to any
corresponding provisions of final Regulations.
Representatives shall have the meaning given to it in Section 6.1(a).
Restricted Information shall have the meaning given to it in Section
6.1.
Restricted Transaction shall mean any (i) acquisition or agreement to
acquire (x) by merging or consolidating with, or by purchasing a substantial
portion of the assets of, or by any other manner, any business or any Person or
other business organization or division thereof or (y) any assets (other than in
the ordinary course of business which for purposes of this definition does not
include the acquisition of communications sites and related assets and other
business involved in the communications sites industry or the construction of
communications towers and related assets), or (ii) any undertaking or agreement
to undertake the construction of one or more communications towers.
Securities Act shall mean the Securities Act of 1933, and the rules
and regulations thereunder, all as from time to time in effect, or any successor
law, rules or regulations, and any reference to any statutory or regulatory
provision shall be deemed to be a reference to any successor statutory or
regulatory provision.
Solvent shall mean, with respect to any Person on a particular date,
that on such date (i) the fair value of the assets of such Person (both at fair
valuation and at present fair saleable value) is, on the date of determination,
greater than the total amount of liabilities, including, without limitation,
contingent and unliquidated liabilities, of such Person, (ii) such Person is
able to pay all liabilities of such Person as they mature, and (iii) such Person
does not have unreasonably small capital with which to carry on its business. In
computing the amount of contingent or unliquidated liabilities at any time, such
liabilities will be computed at the amount which, in light of all the facts and
circumstances existing at such time, represents the amount that can reasonably
be expected to become an actual or matured liability. For purposes of this
definition, "indebtedness" shall mean any liability on a claim, and "claim"
shall mean (a) right to payment, whether or not such right is reduced to
judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured,
disputed, undisputed, legal equitable, secured or unsecured, or (b) right to an
equitable remedy for breach of performance if such breach gives rise to a
payment, whether or not such right to an equitable remedy is reduced to
judgment, fixed, contingent, matured, unmatured, disputed, undisputed, secured
or unsecured.
Subsidiary shall mean, with respect to a Person, any Entity a majority
of the capital stock ordinarily entitled to vote for the election of directors
of which, or if no such voting stock is outstanding, a majority of
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the equity interests of which, is owned directly or indirectly, legally or
beneficially, by such Person or any other Person controlled by such Person.
Surviving Corporation shall have the meaning given to it in Section
2.1.
Tax (and "Taxable", which shall mean subject to Tax), shall mean, with
respect to any Person, (a) all taxes (domestic or foreign), including without
limitation any income (net, gross or other including recapture of any tax items
such as investment tax credits), alternative or add-on minimum tax, gross
income, gross receipts, gains, sales, use, leasing, lease, user, ad valorem,
transfer, recording, franchise, profits, property (real or personal, tangible or
intangible), fuel, license, withholding on amounts paid to or by such Person,
payroll, employment, unemployment, social security, excise, severance, stamp,
occupation, premium, environmental or windfall profit tax, custom, duty or other
tax, or other like assessment or charge of any kind whatsoever, together with
any interest, levies, assessments, charges, penalties, addition to tax or
additional amount imposed by any Taxing Authority, (b) any joint or several
liability of such Person with any other Person for the payment of any amounts of
the type described in (a) and (c) any liability of such Person for the payment
of any amounts of the type described in (a) as a result of any express or
implied obligation to indemnify any other Person.
Tax Return or Returns shall mean all returns, consolidated or
otherwise (including without limitation information returns), required to be
filed with any Authority with respect to Taxes.
Taxing Authority shall mean any Authority responsible for the
imposition of any Tax.
Termination Date shall mean May 31, 1998 or such other date as the
parties may, from time to time, mutually agree.
Transactions shall mean the transactions contemplated by this
Agreement to be consummated on or prior to the Closing Date, including without
limitation the Merger and the execution, delivery and performance of the
Collateral Documents.
Tower Distribution shall mean the pro rata distribution by ARS to each
ARS common stockholder of a umber of shares of ATS Common Stock such that, after
giving to such distribution, (i) immediately prior to the Merger, such ARS
common stockholder will own the same percentage of ATS as it owned of ARS
determined as if all Convertible Securities of ARS had been so converted and all
Option Securities of ARS had ben exercised, (ii) neither ARS nor any of its
Subsidiaries owns any capital stock in ATS or its Subsidiaries, other than
shares of ATS Common Stock (a) required to satisfy ARS Convertible Securities
and ARS Option Securities in the manner contemplated by the CBS Merger Agreement
or (b) owned with respect to (x) shares of ARS Common Stock as to which
appraisal rights have been asserted as a consequence of the Tower Distribution
or (y) ARS Option Securities which have been converted to ATS Option Securities,
and (iii) the Tower Distribution will have been made in all material respects in
accordance with Applicable Law including Federal securities laws.
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