STOCK PURCHASE AGREEMENT
THIS AGREEMENT (the "Agreement") is made and entered into as of
December 23, 1998, by and among ▇▇▇▇▇▇ COMMUNICATIONS CORPORATION, an
Oklahoma corporation (the "Company"), ▇▇▇▇▇▇ ▇▇ LIMITED PARTNERSHIP, an
Oklahoma limited partnership ("DCC, L.P."), ▇▇▇▇▇▇ OPERATING COMPANY, an
Oklahoma corporation ("▇▇▇▇▇▇ Operating"), ▇.▇. CHILDS EQUITY PARTNERS II,
L.P., a Delaware limited partnership ("JWC"), ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ (the
"Representative"), as representative of, and attorney-in-fact for, certain
related persons or entities of JWC listed on Schedule A hereto (the "Group",
and together with JWC, the "JWC Group") (the JWC Group, together with the
Company, DCC, L.P. and ▇▇▇▇▇▇ Operating, the "Purchasers"), FLEET VENTURE
RESOURCES, INC., a Rhode Island corporation ("FVR"), FLEET EQUITY PARTNERS
VI, L.P., a Delaware limited partnership ("FEP"), and ▇▇▇▇▇▇▇ PLAZA PARTNERS,
a Rhode Island general partnership ("KPP" and, together with FVR and FEP,
"Fleet"); and, for purposes of Section 10.10 hereof only, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇.
W I T N E S S E T H T H A T:
WHEREAS, Fleet owns 100,000 shares of Class B Convertible Preferred
Stock of the Company, par value $1.00 per share ("Class B Preferred") and
100,000 shares of Class C Non-Voting Non-Convertible Preferred Stock of the
Company, par value $1.00 per share ("Class C Preferred" and, together with
all of the Common Stock (as defined below) owned by Fleet whether by
conversion of Fleet's Class B Preferred or as payment in connection with the
exercise of the DCC Option (as defined below), the "Fleet Stock"), all as
more particularly described on EXHIBIT A attached hereto;
WHEREAS, Fleet has granted to DCC, L.P. an option (the "DCC
Option") to purchase 40,000 shares of Class B Preferred pursuant to the
terms and conditions of that certain Option Agreement (the "Option
Agreement"), dated March 19, 1996, by and among DCC, L.P. and Fleet;
WHEREAS, DCC, L.P. desires to exercise the DCC Option and in
connection therewith DCC, L.P. will transfer to Fleet and Fleet has agreed to
accept, 18,169 shares of the Company's Class A Common Stock, par value $1.00
per share (the "Common Stock") having an aggregate value of $12,000,000, as
payment for the aggregate exercise price for 40,000 shares of the Common
Stock;
WHEREAS, Fleet desires to convert the 100,000 shares of the Class B
Preferred held by it into 100,000 shares of Common Stock, in accordance with the
terms of the Company's Amended and Restated Certificate of Designations,
Preferences and Relative and Other Special Rights and Qualifications,
Limitations and Restrictions of Class B Convertible Preferred Stock;
WHEREAS, the Company desires to purchase and Fleet desires to sell
to the Company, 22,459 shares of the Common Stock held by Fleet and all of
the Class C Preferred held by Fleet upon the terms and conditions
hereinafter set forth;
WHEREAS, DCC, L.P. desires to purchase and Fleet desires to sell to
DCC, L.P., 17,412 shares of the Common Stock held by Fleet upon the terms and
conditions hereinafter set forth;
WHEREAS, ▇▇▇▇▇▇ Operating desires to purchase and Fleet desires to
sell to ▇▇▇▇▇▇ Operating 20,886 shares of the Common Stock held by Fleet upon
the terms and conditions hereinafter set forth; and
WHEREAS, the JWC Group desires to purchase and Fleet desires to
sell to the JWC Group 17,412 shares of the Common Stock held by Fleet upon
the terms and conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements herein set forth, the parties hereto agree as
follows:
SECTION 1. EXERCISE OF DCC OPTION; CONVERSION OF CLASS B PREFERRED.
1.1 CONVERSION OF CLASS B PREFERRED. Fleet hereby exercises its right
to convert 100,000 shares of Class B Preferred to 100,000 shares of Common
Stock and the Company hereby waives any notice or similar requirement in
connection therewith. Fleet acknowledges that no dividends are payable on or
with respect to such shares of Class B Preferred solely as a result of such
conversion.
1.2 EXERCISE OF DCC OPTION. DCC, L.P. hereby exercises the DCC Option
and subject to the satisfaction of the terms and conditions of this
Agreement, Fleet will sell, assign, convey, transfer and deliver to DCC,
L.P., at the Closing (as defined herein) 40,000 shares of Common Stock, free
and clear of any lien, pledge, claim, encumbrance, restriction, pre-emptive
or similar rights (imposed by statute or contract) or call of any kind
(herein collectively referred to as "Claims"), together with all accrued
dividends and other rights and interests relating thereto, in exchange for an
exercise price of $12,000,000 which payment shall be in the form of 18,169
shares of Common Stock. Payment of the exercise price shall be made to the
Fleet entities pro rata based on the number of shares being sold by each
Fleet entity pursuant to the DCC Option. DCC, L.P. agrees that the transfer
of such Common Stock shall be subject to payment by DCC, L.P. of any issuance
or transfer tax in respect thereof.
1.3 SATISFACTION OF CONDITIONS OF OPTION AGREEMENT. Upon the
satisfaction of the terms and conditions set forth herein (including, without
limitation, any notice or similar requirement) all conditions to the exercise
of the DCC Option shall be deemed to have been satisfied and Fleet's
obligations under the Option Agreement shall be satisfied in its entirety.
1.4 DELIVERY OF STOCK. In connection with this Section 1, at the
Closing (a) Fleet shall deliver (i) to DCC, L.P. certificates representing
40,000 shares of Common Stock, together with stock powers duly endorsed for
transfer of such shares in favor of DCC, L.P. and (ii) to the Company
certificates representing 100,000 shares of Series B Preferred together with
stock powers duly endorsed for transfer of such shares in favor of the
Company; (b) DCC, L.P. shall deliver to Fleet certificates representing
18,169 shares of Common Stock, together with stock powers duly endorsed for
transfer of such shares in favor of FVR, FEP and KPP, as applicable; and (c)
the Company shall deliver to Fleet certificates representing 100,000 shares
of Common Stock.
SECTION 2. SALE AND PURCHASE OF THE FLEET STOCK.
2.1 SALE AND PURCHASE OF THE FLEET STOCK. Subject to the satisfaction
of the terms and conditions of this Agreement, Fleet will sell, assign,
convey, transfer and deliver to the Purchasers, and the Purchasers will
purchase from Fleet, at the Closing (as herein defined), the Fleet Stock
(after giving effect to the exercise of the DCC Option contemplated in
Section 1.2 hereof) free and clear of any Claims.
2.2 PURCHASE PRICE. The purchase price, which includes all accrued
dividends (the "Purchase Price") for the Fleet Stock shall be as follows:
NUMBER AND TYPE OF SHARES PURCHASER PURCHASE PRICE
------------------------- --------- --------------
22,459 shares of Common The Company $16,130,000
Stock
17,412 shares of Common DCC, L.P. $11,500,000
Stock
20,886 shares of Common ▇▇▇▇▇▇ Operating $15,000,000
Stock
17,412 shares of Common The JWC Group $11,500,000
Stock
100,000 shares of Class C The Company $1,870,000
Preferred
In consideration of the receipt of the Purchase Price, Fleet hereby
waives and
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disclaims any right to receive any additional dividends on and any and all
other rights and interests relating to the Fleet Stock.
Each of the Purchasers shall pay to Fleet on the Closing Date, by
wire transfer of immediately available funds, the Purchase Price set forth
opposite such Purchaser's name. Fleet shall provide the Purchasers payment
instructions prior to the Closing Date.
2.3 DELIVERY OF STOCK. At the Closing, Fleet shall deliver to each
Purchaser a certificate representing the number of shares of Fleet Stock
purchased by such Purchaser, together with stock powers duly endorsed for
transfer in favor of such Purchaser.
SECTION 3. THE CLOSING.
The closing of the transactions contemplated hereby (the "Closing")
shall take place on the date (the "Closing Date") and at the location of the
closing of the transactions contemplated by the Agreement and Plan of Merger,
dated as of July 28, 1998 (the "Merger Agreement") by and among ▇▇▇▇▇▇/Sygnet
Operating Company, a wholly-owned subsidiary of the Company and
Sygnet-Wireless, Inc., but in no event later than January 31, 1999.
SECTION 4. REPRESENTATIONS AND WARRANTIES OF FLEET.
Fleet hereby makes the following representations and warranties to the
Purchasers, each of which is true and correct on the date hereof and will be
true and correct on the Closing Date:
4.1 OWNERSHIP; AUTHORITY OF FLEET. On the Closing Date, the shares of
the Fleet Stock will be free and clear of any and all Claims. On the Closing
Date, Fleet will have good and marketable title free and clear of all claims
to the Fleet Stock and has the full legal right, title, power and authority
to sell, deliver, convey and assign the Fleet Stock to the Purchasers. Upon
delivery to the Purchasers of the Certificates for the Fleet Stock and
accompanying instruments of transfer against payment therefor, the Purchasers
will have acquired good, valid and exclusive title to the Fleet Stock, free
and clear of all Claims. The execution and performance of this Agreement by
Fleet, and the consummation by Fleet of the transactions contemplated hereby,
will not violate, result in a breach of, or constitute a default under any
agreement, instrument, judgment, order or decree to which Fleet is a party or
to which Fleet is subject. Except as described in this Agreement, there are
no existing contractual obligations or understandings to purchase, repurchase
or otherwise acquire any of the Fleet Stock or any interest therein. Except
for the Fleet Stock, neither FVR, FEP, KPP nor any of their respective
affiliates owns or has any right to acquire any debt or equity securities of
the Company.
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4.2 ORGANIZATION. (a) FVR is (i) duly organized, validly existing and
in good standing under the laws of the State of Rhode Island, (ii) has full
power and authority to own its property and assets and to carry on its
business as now being conducted and (iii) has full power to execute, deliver
and perform its obligations under the Closing Documents (as defined in
Section 6.1 hereof).
(b) FEP is (i) duly organized, validly existing and in good
standing under the laws of the State of Delaware, (ii) has full power and
authority to own its property and assets and to carry on its business as now
being conducted and (iii) has full power to execute, deliver and perform its
obligations under the Closing Documents.
(c) KPP is (i) duly organized, validly existing and in good
standing under the laws of the State of Rhode Island (ii) has full power and
authority to own its property and assets and to carry on its business as now
being conducted and (iii) has full power to execute, deliver and perform its
obligations under the Closing Documents.
4.3 AUTHORIZATION. (a) The execution and delivery of, and the
performance by FVR of its obligations under, the Closing Documents (i) are
within its corporate powers, (ii) have been duly authorized by all requisite
corporate action, (iii) do not and will not violate any provision of law, any
order of any court or other agency of government, or the corporate charter or
bylaws of FVR, and (iv) do not and will not violate any indenture, agreement
or other instrument to which it is a party, or by which it is bound, or be in
conflict with, result in a breach of, or constitute (with due notice or lapse
of time or both) a default under, or result in the creation or imposition of
any lien, charge or encumbrance of any nature whatsoever upon any of the
property or assets of FVR pursuant to, any such indenture, agreement or
instrument. FVR is not required to obtain any consent, approval or
authorization from, or to file any declaration or statement with, any
governmental instrumentality or other agency in connection with or as a
condition to the execution, delivery or performance of the Closing Documents.
The Closing Documents to which FVR is a party constitute the legal, valid
and binding obligations of FVR enforceable against FVR in accordance with
their respective terms except that such enforceability may be limited by
general principles of equity or laws affecting the enforcement of creditor's
rights generally.
(b) The execution and delivery of, and the performance by FEP of
its obligations under, the Closing Documents (i) are within its partnership
powers, (ii) have been duly authorized by all requisite partnership action,
(iii) do not and will not violate any provision of law, any order of any
court or other agency of government, or the certificate of partnership or
partnership agreement of FEP, and (iv) do not and will not violate any
indenture, agreement or other instrument to which it is a party, or by which
it is bound, or be in conflict with, result in a breach of, or constitute
(with due notice or lapse of time or both) a default under, or result in the
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creation or imposition of any lien, charge or encumbrance of any nature
whatsoever upon any of the property or assets of FEP pursuant to, any such
indenture, agreement or instrument. FEP is not required to obtain any
consent, approval or authorization from, or to file any declaration or
statement with, any governmental instrumentality or other agency in
connection with or as a condition to the execution, delivery or performance
of the Closing Documents. The Closing Documents to which FEP is a party
constitute the legal, valid and binding obligations of FEP enforceable
against FEP in accordance with their respective terms except that such
enforceability may be limited by general principles of equity or laws
affecting the enforcement of creditor's rights generally.
(c) The execution and delivery of, and the performance by KPP of
its obligations under the Closing Documents (i) are within its partnership
powers, (ii) have been duly authorized by all requisite partnership action,
(iii) do not and will not violate any provision of law, any order of any
court or other agency of government, or the certificate of partnership or
partnership agreement of KPP, and (iv) do not and will not violate any
indenture, agreement or other instrument to which it is a party, or by which
it is bound, or be in conflict with, result in a breach of, or constitute
(with due notice or lapse of time or both) a default under, or result in the
creation or imposition of any lien, charge or encumbrance of any nature
whatsoever upon any of the property or assets of KPP pursuant to, any such
indenture, agreement or instrument. KPP is not required to obtain any
consent, approval or authorization from, or to file any declaration or
statement with, any governmental instrumentality or other agency in
connection with or as a condition to the execution, delivery or performance
of the Closing Documents. The Closing Documents to which KPP is a party
constitute the legal, valid and binding obligations of KPP enforceable
against KPP in accordance with their respective terms except that such
enforceability may be limited by general principles of equity or laws
affecting the enforcement of creditor's rights generally.
4.4 BROKERS. Fleet has not used any finder or broker in connection
with this Agreement.
4.5 ACCESS TO INFORMATION. Fleet has had access to all information
requested by it from the Company and the Purchasers and their representatives
concerning the Company and Fleet's decision to sell the Fleet Stock. Fleet
acknowledges that the Company and the Purchasers have made no representations
or warranties concerning the Company or any of its subsidiaries except as
expressly set forth herein, including, without limitation, with respect to
any projections of the future financial performance of the Company.
SECTION 5. REPRESENTATION AND WARRANTIES OF THE PURCHASERS.
Each of ▇▇▇▇▇▇ Operating, DCC, L.P. and JWC (on behalf of itself and the
other
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members of the JWC Group) hereby make, as to themselves, the following
representations and warranties to Fleet, each of which is true and correct on
the date hereof and on the Closing Date.
5.1 ORGANIZATION. (a) ▇▇▇▇▇▇ Operating is (i) duly organized, validly
existing and in good standing under the laws of the State of Oklahoma, (ii)
has full power and authority to own its property and assets and to carry on
its business as now being conducted and (iii) has full power to execute,
deliver and perform its obligations under the Closing Documents.
(b) DCC, L.P. is (i) duly organized, validly existing and in good
standing under the laws of the State of Oklahoma, (ii) has full power and
authority to own its property and assets and to carry on its business as now
being conducted and (iii) has full power to execute, deliver and perform its
obligations under the Closing Documents.
(c) JWC is (i) duly organized, validly existing and in good
standing under the laws of the State of Delaware, (ii) has full power and
authority to own its property and assets and to carry on its business as now
being conducted and (iii) has full partnership power to execute, deliver and
perform its obligations under the Closing Documents.
5.2 AUTHORIZATION. (a) The execution and delivery of, and the
performance by ▇▇▇▇▇▇ Operating of its obligations under, the Closing
Documents (i) are within its corporate powers, (ii) have been duly authorized
by all requisite corporate action, (iii) do not and will not violate any
provision of law, any order of any court or other agency of government, or
the corporate charter or bylaws of ▇▇▇▇▇▇ Operating, and (iv) do not and will
not violate any indenture, agreement or other instrument to which it is a
party, or by which it is bound, or be in conflict with, result in a breach
of, or constitute (with due notice or lapse of time or both) a default under,
or result in the creation or imposition of any lien, charge or encumbrance of
any nature whatsoever upon any of the property or assets of ▇▇▇▇▇▇ Operating
pursuant to, any such indenture, agreement or instrument. ▇▇▇▇▇▇ Operating
is not required to obtain any consent, approval or authorization from, or to
file any declaration or statement with, any governmental instrumentality or
other agency in connection with or as a condition to the execution, delivery
or performance of the Closing Documents. The Closing Documents to which
▇▇▇▇▇▇ Operating is a party constitute the legal, valid and binding
obligations of ▇▇▇▇▇▇ Operating enforceable against ▇▇▇▇▇▇ Operating in
accordance with their respective terms except that such enforceability may be
limited by general principles of equity or laws affecting the enforcement of
creditor's rights generally.
(b) The execution and delivery of, and the performance by DCC,
L.P. of its obligations under, the Closing Documents (i) are within its
partnership powers, (ii) have been duly authorized by all requisite
partnership action, (iii) do not and will not violate any provision of law,
any order of any court or other agency of government, or the certificate of
partnership or
7
partnership agreement of DCC, L.P., and (iv) do not and will not violate any
indenture, agreement or other instrument to which it is a party, or by which
it is bound, or be in conflict with, result in a breach of, or constitute
(with due notice or lapse of time or both) a default under, or result in the
creation or imposition of any lien, charge or encumbrance of any nature
whatsoever upon any of the property or assets of DCC, L.P. pursuant to, any
such indenture, agreement or instrument. Except for required consents which
have been obtained, DCC, L.P. is not required to obtain any consent, approval
or authorization from, or to file any declaration or statement with, any
governmental instrumentality or other agency in connection with or as a
condition to the execution, delivery or performance of the Closing Documents.
The Closing Documents to which DCC, L.P. is a party constitute the legal,
valid and binding obligations of DCC, L.P. enforceable against DCC, L.P. in
accordance with their respective terms except that such enforceability may be
limited by general principles of equity or laws affecting the enforcement of
creditor's rights generally.
(c) The execution and delivery of, and the performance by JWC of
its obligations under the Closing Documents (i) are within its partnership
powers, (ii) have been duly authorized by all requisite partnership action,
(iii) do not and will not violate any provision of law, any order of any
court or other agency of government, or the certificate of partnership or
partnership agreement of JWC, and (iv) do not and will not violate any
material indenture, agreement or other instrument to which it is a party, or
by which it is bound, or result in a breach of, or constitute (with due
notice or lapse of time or both) a material default under, or result in the
creation or imposition of any material lien, charge or encumbrance of any
nature whatsoever upon any of the property or assets of JWC pursuant to, any
such indenture, agreement or instrument. Except for required consents which
have been obtained, JWC is not required to obtain any consent, approval or
authorization from, or to file any declaration or statement with, any
governmental instrumentality or other agency in connection with or as a
condition to the execution, delivery or performance of the Closing Documents.
The Closing Documents to which JWC is a party constitute the legal, valid
and binding obligations of JWC enforceable against JWC in accordance with
their respective terms except that such enforceability may be limited by
general principles of equity or laws affecting the enforcement of creditor's
rights generally.
5.3 BROKERS. None of the Purchasers has used any finder or broker in
connection with this Agreement.
5.4 INVESTMENT INTEREST. Each Purchaser hereby represents and warrants
to Fleet that it is acquiring the securities to be purchased by it pursuant
to this Agreement for investment and not with a view towards the sale or
distribution of the rights hereunder or thereunder.
SECTION 6. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.
8
The Company hereby makes the following representations and warranties to
Fleet, each of which is true and correct on the date hereof and on the
Closing Date:
6.1 ORGANIZATION. The Company (a) is duly organized, validly existing
and in good standing under the laws of Oklahoma; (b) is duly qualified to
transact business in every jurisdiction where, because of the nature of its
business or property, such qualification is required, including, without
limitation, the State of Oklahoma; (c) has full power and authority to own
its property and assets and to carry on its business as now being conducted;
and (d) has full power to execute, deliver and perform its obligations under
this Agreement and all documents, agreements, certificates, and instruments
executed in connection herewith (collectively, together with this Agreement
and the Exhibits and Schedules hereto, the "Closing Documents").
6.2. AUTHORIZATION. The execution and delivery of, and the performance
by the Company of its obligations under the Closing Documents (a) are within
its corporate powers, (b) have been duly authorized by all requisite
corporate action, (c) do not and will not violate any provision of law, any
order of any court or other agency of government, or the corporate charter or
by-laws of the Company, and (d) do not and will not violate any indenture,
agreement or other instrument to which it is a party, or by which it is
bound, or be in conflict with, result in a breach of, or constitute (with due
notice or lapse of time or both) a default under, or result in the creation
or imposition of any lien, charge or encumbrance of any nature whatsoever
upon any of the property or assets of the Company pursuant to, any such
indenture, agreement or instrument. Except for required consents which have
been obtained, the Company is not required to obtain any consent, approval or
authorization from, or to file any declaration or statement with, any
governmental instrumentality or other agency in connection with or as a
condition to the execution, delivery or performance of the Closing Documents.
6.3 NO OTHER TRANSACTIONS. Except in connection with the raising of
capital in order to consummate the transactions contemplated by the Merger
Agreement and to effect the stock purchase contemplated hereunder, neither
the Company nor, to its knowledge, any of its stockholders are currently
contemplating, and neither the Company nor, to its knowledge, any of its
stockholders have engaged in any discussions concerning, any transaction
involving an initial public offering of shares of the Company's capital
stock, the sale of outstanding shares of capital stock of the Company to
third parties or the sale of all or substantially all of the assets of the
Company.
6.4 SOLVENCY. Prior to, upon and immediately after the consummation of
the transactions contemplated hereby, the Company was, is, and will be
solvent and will have tangible and intangible assets having a fair value in
excess of the amount required to pay its probable liabilities on its existing
debts as they become absolute and matured, including for this
9
purpose reasonable estimates of known unliquidated and disputed claims, and
has access to adequate capital for the conduct of its business and the
ability to pay its debts from time to time incurred in connection therewith
as such debts mature.
6.5 LITIGATION. There is no threatened or pending suit, claim, action
or proceeding against the Company or any of its subsidiaries which
individually or in the aggregate is reasonably likely to have a material
adverse effect upon the business, assets or condition, financial or
otherwise, of the Company; and there is no suit, claim, action or proceeding
now pending or threatened which seeks to prevent or delay the consummation of
the transactions contemplated by the Closing Documents.
6.6 NO BREACH. The consummation of the transactions contemplated by
the Closing Documents will not constitute or result in any default, breach or
violation of any statute, law, ordinance, decree, order, rule or regulation
of any governmental body, any provision of the Company's Articles of
Incorporation or By-laws, any promissory note, indenture or any evidence of
indebtedness or instrument or agreement providing security therefor, or any
lease, contract, commitment or other agreement to which it is a party or by
which it is bound, which individually or in the aggregate may result in a
material adverse effect on the business, assets or condition, financial or
otherwise, of the Company.
6.7 BROKERS. The Company has not used any finder or broker in
connection with this Agreement.
6.8 ENFORCEABLILTY. The execution and delivery by the Company of the
Closing Documents to which it is a party constitute the legal, valid and
binding obligations of the Company enforceable against the Company in
accordance with their respective terms except as such enforceability may be
limited by general principles of equity or laws affecting the enforcement of
creditors' rights generally.
SECTION 7. CONDITIONS PRECEDENT TO THE PURCHASERS' OBLIGATIONS.
All obligations of the Purchasers under this Agreement are subject
to the fulfillment (or waiver in whole or in part by each of the Purchasers
in writing) on or before the Closing Date, of each of the following
conditions:
7.1 CORRECTNESS OF REPRESENTATIONS AND WARRANTIES. The representations
and warranties of Fleet contained in this Agreement shall be true and correct
in all material respects on the date hereof and on the Closing Date as though
such representations and warranties were made on and as of the Closing Date.
10
7.2 COMPLIANCE WITH AGREEMENT. Fleet shall have performed and complied
in all material respects with all of its obligations contemplated by this
Agreement.
7.3 GENERAL RELEASE. The Purchasers shall have received from Fleet and
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ a General Release in the form of Exhibit B attached
hereto.
SECTION 8. CONDITIONS PRECEDENT TO FLEET'S OBLIGATIONS.
All obligations of Fleet under this Agreement are subject to
fulfillment (or waiver in whole or in part by Fleet in writing) on or before
the Closing Date of the following conditions:
8.1 CORRECTNESS OF REPRESENTATIONS AND WARRANTIES. The representations
and warranties of the Purchasers contained in this Agreement shall be true
and correct in all material respects on the date hereof and on the Closing
Date as though such representations and warranties were made on and as of the
Closing Date.
8.2 COMPLIANCE WITH AGREEMENT. The Purchasers shall have performed and
complied in all material respects with all of their obligations under this
Agreement.
8.3 GENERAL RELEASE. Fleet shall have received from the Company and
its stockholders a General Release in the form of EXHIBIT B attached hereto.
8.4 EXPENSES. The Company shall have paid any and all of Fleet's
reasonable out-of-pocket costs and expenses (including, without limitation,
reasonable legal fees and expenses) incurred as a result of the transactions
contemplated hereby and those contemplated by the Merger Agreement.
8.5 CLOSING DATE. The Closing shall occur no later than January 31,
1998.
SECTION 9. INDEMNIFICATION.
9.1 INDEMNIFICATION BY COMPANY. The Company shall indemnify Fleet and
its directors, officers and employees (collectively "Fleet Parties") and
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, respectively, against and hold each of them harmless
from any and all liabilities, claims, suits, proceedings, demands, judgments,
damages, expenses and costs (including without limitation, reasonable counsel
fees and costs and expenses incurred in the investigation, defense or
settlement of any claims covered by this indemnity, on an as-incurred basis)
which Fleet or ▇▇. ▇▇▇▇▇▇▇▇ may suffer or incur by reason of Fleet's
ownership of the Company's capital stock prior to the date hereof or by
reason of ▇▇. ▇▇▇▇▇▇▇▇'▇ service as a director of the Company prior to
11
the date hereof, including, without limitation, fraudulent conveyances made
by the Company to Fleet, any material breach by the Company of any of the
covenants, representations, warranties or agreements made by the Company in
this Agreement or liabilities arising in connection with the claims
instituted against the Company and certain other persons by ▇▇▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇▇▇. The indemnification provided to ▇▇. ▇▇▇▇▇▇▇▇ herein is in
addition to any other indemnification the Company may provide or has agreed
to provide to the members of the Board of Directors of the Company and shall
not limit in any way any other indemnification provided by the Company.
9.2 PROCEDURE. If any claim is made by Fleet or ▇▇. ▇▇▇▇▇▇▇▇, or if
any suit or proceeding is instituted against the Company, Fleet or ▇▇. ▇▇▇▇▇▇▇▇
which, if valid or prosecuted successfully would entitle Fleet or ▇▇. ▇▇▇▇▇▇▇▇
to be indemnified by the Company under Section 9.1 hereof (an "Indemnifiable
Claim"), Fleet or ▇▇. ▇▇▇▇▇▇▇▇ shall notify the Company in writing of such
Indemnifiable Claim or potential Indemnifiable Claim. The Company may, at
its own cost and expense, assume the defense of such Indemnifiable Claim or
participate with Fleet and/or ▇▇. ▇▇▇▇▇▇▇▇, as the case may be, either
directly or through its counsel, in the resolution, by litigation or
otherwise, of any Indemnifiable Claim. Fleet and ▇▇. ▇▇▇▇▇▇▇▇ agree to
reasonably cooperate with the Company in determining the validity of any
Indemnifiable Claim. Fleet and ▇▇. ▇▇▇▇▇▇▇▇ agree that it and he will not
settle any Indemnifiable Claim without the written consent of the Company,
which shall not be unreasonably withheld.
9.3 INCREMENTAL INDEMNIFICATION. The indemnification provided to
▇▇. ▇▇▇▇▇▇▇▇ under Section 9.1 shall be in addition to any other
indemnification provided to members of the Board of Directors of the Company.
▇▇. ▇▇▇▇▇▇▇▇ shall be entitled to exercise any other rights to indemnification
as a director he may have and such other rights shall not be limited in any
way by the provisions of this Section 9.
9.4 NOTICES. Notices hereunder shall be effective if personally
delivered or deposited in the United States mail, postage prepaid, registered
or certified, return receipt requested or sent via nationally recognized
overnight delivery service, and addressed:
To the Company:
▇▇▇▇▇▇ Communications Corporation
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
12
With a copy to:
▇▇▇▇▇▇ Communications Corporation
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
Senior Corporate Counsel
To Fleet:
Fleet Equity Partners
▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
With a copy to:
▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
Paul, Hastings, ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇, LLP
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
To the JWC Group:
▇.▇. Childs Associates, L.P.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
With a copy to:
Skadden, Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Any party may change the address to which notices are to be addressed by
giving the other party notice in the manner herein set forth.
13
SECTION 10. MISCELLANEOUS.
10.1 ASSIGNMENT. Neither this Agreement nor any right hereunder may be
assigned by any party without the prior written consent of the other parties.
10.2 FURTHER ACTS. From and after the Closing Date, upon reasonable
request, each party hereto will perform all such further acts and assurances
and execute, acknowledge and deliver documents as may be reasonably
appropriate to carry out the transactions contemplated hereby.
10.3 ENTIRE AGREEMENT; CONSTRUCTION. This Agreement, including the
Exhibits and the Schedules delivered pursuant hereto, constitute the entire
agreement of the parties hereto with respect to the subject matter hereof and
supersedes all prior promises, understandings and agreements with reference
to the subject matter hereof. This Agreement may not be changed, terminated
or discharged without a mutual written instrument signed by the parties
hereto. This Agreement shall be construed under the laws of the State of New
York , without giving effect to principles of conflicts of laws, and shall be
binding upon and inure to the benefit of the parties hereto, their respective
heirs, legal representatives and permitted assigns.
10.4 HEADINGS. The headings of the Sections and paragraphs of this
Agreement have been inserted for the convenience of reference only and shall
not affect the interpretation of any of the provisions of this Agreement.
10.5 TERMINATION. As of the Closing Date, the Securities Purchase
Agreement by and among Fleet and the Company dated as of March 19, 1996 (as
amended as of February 26, 1997) (the "SPA"); the Shareholders Agreement
among the Company and its shareholders, dated as of February 26, 1997; the
Option Agreement; the Option Agreement among Fleet and the Company dated as
of March 19, 1996; and each other agreement between or among Fleet, the
Company or any of the Company's affiliates related to any of the foregoing
shall be terminated and extinguished and no party thereto shall have any
further liability to the other party or parties thereto. Fleet and the
Company shall not, and the Company shall cause its affiliates not to, make
any claim under any of such agreements.
10.6 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each such counterpart being deemed to be an original
instrument, and all such counterparts shall together constitute the same
agreement.
10.7 SEVERABILITY. In the event that any provision of this Agreement
becomes or is declared by a court of competent jurisdiction to be illegal,
unenforceable or void, this Agreement shall continue in full force and effect
without said provision.
14
10.8 KEY MAN POLICY. Fleet hereby acknowledges and agrees that as of
the Closing Date it shall have no further right or interest in the key man
life insurance policy required to be obtained pursuant to Section 5.10 of the
SPA. Fleet agrees to take such steps as the Company reasonably requests (at
the Company's expense) to evidence its relinquishment of any interest in such
policy.
10.9 GOVERNING LAW. This Agreement shall be governed by the laws of
the State of New York, without giving effect to principles of conflicts of
law.
10.10 CONFIDENTIALITY. (a) Each of Fleet and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
("▇▇▇▇▇▇▇▇") acknowledge that, in the course of their association with the
Company and DCC, L.P., they have received and become knowledgeable regarding
confidential and proprietary information about the Company, its subsidiaries
and DCC, L.P., including but not limited to financial information and
analyses, business models, customer data, reports, plans, market information,
studies, strategies, documents and trade secrets which are not publicly
available ("Confidential Information"). "Confidential Information" shall not
include any information (i) which is or becomes publicly available, other
than as a result of disclosure in violation of this Section 10.10, (ii) was
available to or known by Fleet or ▇▇▇▇▇▇▇▇ prior to its disclosure by the
Company or any of its subsidiaries or DCC, L.P., or (iii) becomes available
to Fleet or ▇▇▇▇▇▇▇▇ from a person who is not obligated to the Company or one
of its subsidiaries or DCC, L.P. to keep such information confidential.
(b) For a period of one (1) year after the date of this Agreement,
Fleet and ▇▇▇▇▇▇▇▇ each agree to keep all such Confidential Information
confidential and not to disclose (in whole or in part) such Confidential
Information to any person not affiliated with the Company, without the prior
written consent of the Company, which may be withheld for any reason. In
addition to all other rights and remedies to prevent any breach or threatened
breach of this non-disclosure obligation. This non-disclosure obligation of
Fleet and ▇▇▇▇▇▇▇▇ shall survive the Closing Date and shall not be released
by the General Release given to them in connection with this Agreement.
15
IN WITNESS WHEREOF, the parties hereto have executed this Agreement
as of the day and year first above written.
FLEET VENTURE RESOURCES, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
---------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Senior Vice President
FLEET EQUITY PARTNERS VI, L.P.
By: Fleet Growth Resources II, Inc.,
A General Partner
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
---------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Senior Vice President
▇▇▇▇▇▇▇ PLAZA PARTNERS
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
---------------------------------
General Partner
▇▇▇▇▇▇ COMMUNICATIONS CORPORATION
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: President
▇▇▇▇▇▇ ▇▇ LIMITED PARTNERSHIP
By: RLD, Inc., its General Partner
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: President
▇▇▇▇▇▇ OPERATING COMPANY
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: President
▇.▇. CHILDS EQUITY PARTNERS II, L.P.
By: ▇.▇. Childs Advisors II, L.P., its general partner
By: ▇.▇. Childs Associates, L.P., its general partner
By: ▇.▇. Childs Associates, Inc., its general partner
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
------------------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Vice President
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
------------------------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, as agent, and attorney-in-fact
for certain coinvestors under Purchaser
Appointment of Agent and Power of Attorney and
not in his individual capacity
FOR PURPOSES OF SECTION 10.10 ONLY
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
SCHEDULE A
▇▇▇▇▇▇
JWC Stockholders
STOCKHOLDER
1 ▇.▇. Childs Equity Partners II, L.P.
2 JWC Equity Funding II, Inc.
3 ▇▇▇▇ Family Trust
4 Childs, ▇▇▇▇ ▇.
5 Childs, ▇▇▇▇▇▇▇ ▇.
6 Childs, ▇▇▇▇▇ ▇.
7 ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇.
8 ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇.
9 ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇.
10 ▇▇▇▇, ▇▇▇▇▇ ▇.
11 MacDonald, ▇. ▇▇▇▇
12 ▇▇▇▇, ▇▇▇▇▇▇▇ ▇.
13 ▇▇▇▇▇▇▇▇, ▇▇▇▇
14 Chechesse Creek Trust
15 ▇▇▇▇▇, ▇▇▇▇▇▇ ▇.
16 SGS 1995 Family Limited Partnership
▇▇ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇ ▇▇▇-▇▇▇ Family Limited Partnership
19 ▇▇▇▇▇▇, ▇▇▇▇ ▇.
20 Suttin Irrevocable Family Trust, ▇▇▇▇ ▇.
21 Suttin Family Trust II
22 ▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇ ▇.
23 ▇▇▇, ▇▇▇▇▇▇ ▇.
24 Yun Family Trust
25 ▇▇▇▇▇, ▇▇▇
26 ▇▇▇▇▇▇▇▇▇, ▇▇
27 ▇▇▇▇▇▇, ▇▇▇
28 Rebacliff, ▇▇▇▇▇ & ▇▇▇▇▇, LLC
29 ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇.
30 ▇▇▇▇▇▇▇, ▇▇▇▇▇
31 ▇▇▇▇▇, ▇▇▇▇
32 OFS Investment Partners II
18
19
LIST OF EXHIBITS AND SCHEDULES
Exhibit A Stock owned by Fleet
Exhibit B Release
20
EXHIBIT A
STOCK OWNED BY FLEET
SHAREHOLDER SHARES TO BE REDEEMED
----------- ---------------------
Fleet Venture Resources, Inc. Stock Certificate Nos. B-1 for 27,778
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ shares and B-4 for 41,668 shares of
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ Class B Convertible Preferred Stock,
convertible into an aggregate of 69,446
shares of Class A Voting Stock
Stock Certificate Nos. CP-1 for 27,778
shares and CP-4 for 41,668 shares of
Class C Non-Voting, Non-Convertible
Preferred Stock
Fleet Equity Partners VI, L.P. Stock Certificate Nos. B-2 for 11,905
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ shares and B-5 for 17,857 shares of
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ Class B Convertible Stock, convertible
into an aggregate of 29,762 shares of
Class A Voting Common Stock
Stock Certificate Nos. CP-2 for 11,905
shares and CP-5 for 17,857 shares of
Class C Non-Voting, Non-Convertible
Preferred Stock
▇▇▇▇▇▇▇ Plaza Partners Stock Certificate Nos. B-3 for 317
c/o Fleet Equity Partners shares and B-6 for 475 shares of Class B
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ Preferred Stock, convertible
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ into an aggregate of 792 shares of
Class A Voting Common Stock
Stock Certificate Nos. CP-3 for 317
shares and CP-6 for 475 shares of
Class C Non-Voting, Non-Convertible
Preferred Stock
20
EXHIBIT B
GENERAL RELEASE
This General Release is entered into this 23rd day of December,
1998, by and between ▇▇▇▇▇▇ Communications Corporation, a Delaware corporation
(the "Company"), the shareholders of the Company who are signatories to this
General Release (the "Company Shareholders"; and together with the Company,
the "Company Parties"); and Fleet Venture Resources, Inc., a Rhode Island
corporation ("FEP"), Fleet Equity Partners VI, L.P., a Delaware limited
partnership ("FFG"), ▇▇▇▇▇▇▇ Plaza Partners, a Rhode Island general
partnership ("KPP"), and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, an individual ("▇▇▇▇▇▇▇▇";
and together with FVR, FEP and KPP, the "Fleet Parties").
In consideration of the sum of $1.00 paid to the Company Parties by
the Fleet Parties and for other good and valuable consideration, the receipt
of which is hereby acknowledged, and in consideration of the mutual releases
set forth herein, the undersigned parties hereby agree as follows:
1. The Company Parties, and each of them, do hereby remise, release
and forever discharge the Fleet Parties, and their respective officers,
directors, employees, shareholders, partners, managers, agents, successors
and assigns from any and all manner of actions, causes of action, debts,
dues, claims and demands, both at law and in equity (collectively, "Claims"),
that the Company Parties or any of them ever had, now have, or in the future
may have for or by reason or means of any matter or thing from the beginning
of the world to the present, and further, but without restricting the
generality of the foregoing, any and all Claims, which directly or indirectly
are the subject matter of, arise out of, or are connected in any way with the
Fleet Parties' ownership of capital stock of Company, except as set forth in
Paragraph 3 below.
2. The Fleet Parties, and each of them, do hereby remise, release and
forever discharge the Company Parties, and their respective officers,
directors, employees, shareholders, partners, managers, agents, successors
and assigns from any and all Claims, that the Fleet Parties or any of them
ever had, now have, or in the future may have for or by reason or means of
any matter or thing from the beginning of the world to the present, and
further, but without restricting the generality of the foregoing, any and all
Claims, which arose while the Fleet Parties were owners of capital stock of
the Company or while ▇▇▇▇▇▇▇▇ served on the Company's board of directors,
except as set forth in Paragraph 3 below.
3. Notwithstanding anything in this General Release to the contrary,
this General
21
Release will not release any of the parties hereto from (i) Claims based upon
fraud committed by such party or such party's breach of its fiduciary duty to
the other party or (ii) any of their respective representations, warranties,
covenants, agreements and obligations pursuant to that certain Stock Purchase
Agreement of even date herewith by and among the Company and the Fleet
Parties; and (iii) will not release the Company Parties from any obligation
any of them may have to indemnify ▇▇▇▇▇▇▇▇ in conjunction with his service on
the Company's board of directors.
4. This General Release shall be governed by the laws of the State of
New York, without giving effect to principles of conflicts of laws, and any
dispute thereunder shall be resolved in the courts located in that state, and
the undersigned consent to the exclusive jurisdiction of those courts for
such purpose.
5. This General Release may be executed in counterparts, each of which
shall be deemed an original and all of which when taken together shall
constitute one and the same agreement.
22
IN WITNESS WHEREOF, the parties have executed this General Release
as of the date first above written.
▇▇▇▇▇▇ COMMUNICATIONS CORPORATION
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
FLEET VENTURE RESOURCES, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-----------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Senior Vice President
FLEET EQUITY PARTNERS VI, L.P.
By: Fleet Growth Resources II, Inc.,
A General Partner
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-----------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Senior Vice President
▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇ PARTNERS
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
--------------------------------------
General Partner
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-------------------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇ LIMITED PARTNERSHIP
By: RLD, Inc., its General Partner
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Attorney in Fact for RLD, Inc.
24