EXHIBIT 10.18
STOCK PURCHASE AGREEMENT
BETWEEN
TSI COMMUNICATION HOLDINGS, INC.
AND
TSI COMMUNICATION HOLDINGS, LLC
DATED AS OF FEBRUARY 14, 2002
TABLE OF CONTENTS
Section 1. Authorization and Closing.....................................................1
1A. AUTHORIZATION OF THE STOCK.............................................1
1B. PURCHASE AND SALE OF THE STOCK.........................................1
1C. THE INITIAL CLOSING....................................................1
Section 2. CONDITIONS OF THE PURCHASER'S OBLIGATION AT THE CLOSING.......................1
2A. REPRESENTATIONS AND WARRANTIES; COVENANTS..............................2
2B. CERTIFICATE OF INCORPORATION...........................................2
2C. BYLAWS.................................................................2
2D. ACQUISITION AGREEMENT..................................................2
2E. CLOSING DOCUMENTS......................................................2
2F. FEES AND EXPENSES......................................................2
2G. COMPLIANCE WITH APPLICABLE LAWS........................................2
2H. WAIVER.................................................................3
Section 3. COVENANTS.....................................................................3
3A. FINANCIAL STATEMENTS AND OTHER INFORMATION.............................3
3B. INSPECTION OF PROPERTY.................................................4
3C. RESTRICTIONS...........................................................5
3D. AMENDMENT OF OTHER AGREEMENTS..........................................6
3E. UNRELATED BUSINESS TAXABLE INCOME......................................6
3F. ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ COMPLIANCE...........................................6
Section 4. TRANSFER OF RESTRICTED SECURITIES.............................................6
Section 5. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.................................7
5A. ORGANIZATION AND CORPORATE POWER.......................................7
5B. CAPITAL STOCK AND RELATED MATTERS......................................8
5C. SUBSIDIARIES; INVESTMENTS..............................................8
5D. AUTHORIZATION; NO BREACH...............................................8
5E. CONDUCT OF BUSINESS; LIABILITIES.......................................9
5F. LITIGATION, ETC........................................................9
5G. BROKERAGE..............................................................9
5H. GOVERNMENTAL CONSENT, ETC..............................................9
5I. DISCLOSURE.............................................................9
5J. CLOSING DATE..........................................................10
Section 6. DEFINITIONS..................................................................10
Section 7. MISCELLANEOUS................................................................12
7A. EXPENSES..............................................................12
7B. REMEDIES..............................................................12
7C. PURCHASER'S INVESTMENT REPRESENTATIONS................................12
7D. CONSENT TO AMENDMENTS.................................................13
7E. SURVIVAL OF REPRESENTATIONS AND ▇▇▇▇▇▇▇▇▇▇............................▇▇
-▇-
▇▇. SUCCESSORS AND ASSIGNS................................................13
7G. GENERALLY ACCEPTED ACCOUNTING PRINCIPLES..............................13
7H. SEVERABILITY..........................................................14
7I. COUNTERPARTS..........................................................14
7J. ENTIRE AGREEMENT......................................................14
7K. DESCRIPTIVE HEADINGS; INTERPRETATION..................................14
7L. GOVERNING LAW.........................................................14
7M. NOTICES...............................................................14
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LIST OF EXHIBITS
Exhibit A......................Amended and Restated Certificate of Incorporation
Exhibit B.................................................................Bylaws
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STOCK PURCHASE AGREEMENT
This
STOCK PURCHASE AGREEMENT (this "AGREEMENT") is made as of
February 14, 2002, between TSI Telecommunication Holdings, Inc., a
Delaware
corporation (the "COMPANY"), and TSI Telecommunication Holdings, LLC, a
Delaware
limited liability company (the "PURCHASER"). Except as otherwise indicated
herein, capitalized terms used herein are defined in SECTION 6 hereof.
The parties hereto agree as follows:
Section 1. Authorization and Closing.AUTHORIZATION OF THE STOCK. The
Company shall authorize the issuance and sale to the Purchaser of 300,000 shares
of its Class A Cumulative Redeemable Preferred Stock, par value $0.01 per share
(the "PREFERRED STOCK"), and 101,000,000 shares of its Common Stock, par value
$0.001 per share (the "COMMON STOCK"), each having the rights and preferences
set forth in EXHIBIT A attached hereto. The Preferred Stock and the Common Stock
are collectively referred to herein as the "STOCK".
1B. PURCHASE AND SALE OF THE STOCK.
(i) INITIAL CLOSING. At the Initial Closing (as defined in SECTION
1C below), the Company shall sell to the Purchaser and, subject to the
terms and conditions set forth herein, the Purchaser shall purchase from
the Company, 99,000,000 shares of Class A Common Stock at a price of $0.13
per share and 240,479.70 shares of Preferred Stock at a price of $1,000 per
share.
(ii) SUBSEQUENT CLOSINGS. Upon the written request of the Board and
with the prior written approval of the Majority Member, the Purchaser may
purchase from time to time after the Initial Closing, additional shares of
Common Stock and Preferred Stock (each such purchase, a "SUBSEQUENT
CLOSING"). At each Subsequent Closing, the Purchaser shall have the right
to purchase Common Stock and Preferred Stock in the same proportion as in
the Initial Closing, and at the same price per share as at the Initial
Closing (as adjusted for stock splits, stock dividends, or other
recapitalization transaction).
1C. THE INITIAL CLOSING. The closing of the purchase and sale of
the Stock to be purchased pursuant to SECTION 1B(i) (the "INITIAL CLOSING")
shall take place at the offices of ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇, Citigroup Center, ▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ at 10:00 a.m. on February 14, 2002, or at
such other place or on such other date as may be mutually agreeable to the
Company and the Purchaser. At the Closing, the Company shall deliver to the
Purchaser certificates evidencing the Stock to be purchased by the Purchaser,
registered in the Purchaser's name, upon payment of the purchase price thereof
by a cashier's or certified check, or by wire transfer of immediately available
funds to such account as designated by the Company.
Section 2. CONDITIONS OF THE PURCHASER'S OBLIGATION AT THE CLOSING.
The obligation of the Purchaser to purchase and pay for the Stock to be
purchased by it at the Closing is subject to the satisfaction as of the Closing
of the following conditions:
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2A. REPRESENTATIONS AND WARRANTIES; COVENANTS. The representations
and warranties contained in SECTION 5 hereof shall be true and correct at and as
of the Closing as though then made, except to the extent of changes caused by
the transactions expressly contemplated herein, and the Company shall have
performed in all material respects all of the covenants required to be performed
by it hereunder prior to the Closing.
2B. CERTIFICATE OF INCORPORATION. The Company's amended and
restated certificate of incorporation (the "CERTIFICATE OF INCORPORATION") shall
include the provisions set forth in EXHIBIT A hereto, shall be in full force and
effect under the laws of
Delaware as of the Closing and shall not have been
amended or modified.
2C. BYLAWS. The Company's bylaws shall include the provisions set
forth in EXHIBIT B hereto (the "BYLAWS"), shall be in full force and effect
under the laws of
Delaware as of the Closing and shall not have been amended or
modified.
2D. ACQUISITION AGREEMENT. The Acquisition Agreement shall be in
form and substance satisfactory to Purchaser, shall be in full force and effect
as of the Closing and shall not have been amended or modified. The conditions in
Article VII of the Acquisition Agreement shall have been satisfied in full
(without reliance on any waiver by the Company), and the acquisition
contemplated by the Acquisition Agreement shall have been consummated
simultaneously with the Closing hereunder in accordance with the terms of the
Acquisition Agreement.
2E. CLOSING DOCUMENTS. The Company shall have delivered to the
Purchaser all of the following documents:
(i) an Officer's Certificate, dated the date of the Closing,
stating that the conditions specified in SECTION 1 and SECTIONS 2A through
2D, inclusive, have been fully satisfied;
(ii) certified copies of the resolutions duly adopted by the Board
authorizing the execution, delivery and performance of this Agreement and
each of the other agreements contemplated hereby, the issuance and sale of
the Stock and the consummation of all other transactions contemplated by
this Agreement; and
(iii) certified copies of the Certificate of Incorporation and the
Bylaws, each as in effect at the Closing.
2F. FEES AND EXPENSES. The Company shall have reimbursed the
Purchaser for its out-of-pocket fees and expenses as provided in SECTION 7A
hereof.
2G. COMPLIANCE WITH APPLICABLE LAWS. The purchase of Stock by the
Purchaser hereunder shall not be prohibited by any applicable law or
governmental regulation, shall not subject the Purchaser to any penalty,
liability or, in Purchaser's sole judgment, other onerous conditions under or
pursuant to any applicable law or governmental regulation, and shall be
permitted by laws and regulations of the jurisdictions to which the Purchaser is
subject.
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2H. WAIVER. Any condition specified in this SECTION 2 may be waived
only if such waiver is set forth in a writing executed by the Purchaser.
Section 3. COVENANTS.
3A. FINANCIAL STATEMENTS AND OTHER INFORMATION. The Company shall
deliver the following to the Purchaser and to the Majority Member (so long as
the Purchaser holds any Stock):
(i) as soon as available but in any event within 30 days after the
end of each monthly accounting period in each fiscal year, unaudited
consolidating and consolidated statements of income and cash flows of the
Company and its Subsidiaries for such monthly period and for the period
from the beginning of the fiscal year to the end of such month, and
consolidating and consolidated balance sheets of the Company and its
Subsidiaries as of the end of such monthly period, all prepared in
accordance with generally accepted accounting principles, consistently
applied, subject to the absence of footnote disclosures and to normal
year-end adjustments;
(ii) accompanying the financial statements referred to in (i) above,
an Officer's Certificate stating that neither the Company nor any of its
Subsidiaries is in default under any of its material agreements or, if any
such default exists, specifying the nature and period of existence thereof
and what actions the Company and its Subsidiaries have taken and propose to
take with respect thereto;
(iii) within 90 days after the end of each fiscal year, consolidating
and consolidated statements of income and cash flows of the Company and its
Subsidiaries for such fiscal year, and consolidating and consolidated
balance sheets of the Company and its Subsidiaries as of the end of such
fiscal year, setting forth in each case comparisons to the annual budget
and to the preceding fiscal year, all prepared in accordance with generally
accepted accounting principles, consistently applied, and accompanied by
(a) with respect to the consolidated portions of such statements (except
with respect to budget data), an opinion containing no exceptions or
qualifications (except for qualifications regarding specified contingent
liabilities) of an independent accounting firm of recognized national
standing acceptable to the Majority Member, and (b) a copy of such firm's
annual management letter to the Board;
(iv) promptly upon receipt thereof, any additional reports,
management letters or other detailed information concerning significant
aspects of the Company's operations or financial affairs given to the
Company by its independent accountants (and not otherwise contained in
other materials provided hereunder);
(v) at least 30 days prior to the beginning of each fiscal year, an
annual budget prepared on a monthly basis for the Company and its
Subsidiaries for such fiscal year (displaying anticipated statements of
income and cash flows), and promptly upon preparation thereof any other
significant budgets prepared by the Company and any revisions of such
annual or other budgets, and within 30 days after any monthly period in
which there is a material adverse deviation from the annual budget, an
Officer's
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Certificate explaining the deviation and what actions the Company has taken
and proposes to take with respect thereto;
(vi) promptly (but in any event within 5 business days) after the
discovery or receipt of notice of any default under any material agreement
to which it or any of its Subsidiaries is a party or any other event or
circumstance affecting the Company or any Subsidiary which is reasonably
likely to have a material adverse effect on the financial condition,
operating results, assets, operations or business prospects of the Company
or any Subsidiary (including the filing of any material litigation against
the Company or any Subsidiary or the existence of any material dispute with
any Person which involves a reasonable likelihood of such litigation being
commenced), an Officer's Certificate specifying the nature and period of
existence thereof and what actions the Company and its Subsidiaries have
taken and propose to take with respect thereto;
(vii) with reasonable promptness, such other information and
financial data concerning the Company and its Subsidiaries as any Person
entitled to receive information under this SECTION 3A may reasonably
request; and
(viii) within 10 days after transmission thereof, copies of all
financial statements, proxy statements, reports and any other general
written communications which the Company sends to its stockholders, and
copies of all registration statements and all regular, special or periodic
reports which it files, or any of its officers or directors file with
respect to the Company, with the Securities and Exchange Commission or with
any securities exchange on which any of its securities are then listed, and
copies of all press releases and other statements made available generally
by the Company to the public concerning material developments in the
Company's and its Subsidiaries' businesses.
Each of the financial statements referred to in subsections (i) and (iii) shall
be true and correct in all material respects as of the dates and for the periods
stated therein, subject in the case of the unaudited financial statements to
changes resulting from normal year-end audit adjustments (none of which would,
alone or in the aggregate, be materially adverse to the financial condition,
operating results, assets, operations or business prospects of the Company and
its Subsidiaries taken as a whole).
3B. INSPECTION OF PROPERTY. The Company shall permit any
representatives designated by Purchaser or the Majority Member (so long as such
Purchaser holds any Stock), upon reasonable notice and during normal business
hours and such other times as any such holder may reasonably request, to (i)
visit and inspect any of the properties of the Company and its Subsidiaries,
(ii) examine the corporate and financial records of the Company and its
Subsidiaries and make copies thereof or extracts therefrom and (iii) discuss the
affairs, finances and accounts of any such corporations with the directors,
officers, key employees and independent accountants of the Company and its
Subsidiaries; PROVIDED THAT the Company shall have the right to have its chief
financial officer present at any meetings with the Company's independent
accountants.
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3C. RESTRICTIONS. The Company shall not, without the prior written
consent of the Majority Member:
(i) except as expressly contemplated by this Agreement, authorize,
issue, sell or enter into any agreement providing for the issuance
(contingent or otherwise), or permit any Subsidiary to authorize, issue,
sell or enter into any agreement providing for the issuance (contingent or
otherwise) of, (a) any notes or debt securities containing equity features
(including any notes or debt securities convertible into or exchangeable
for equity securities, issued in connection with the issuance of equity
securities or containing profit participation features) or (b) any equity
securities (or any securities convertible into or exchangeable for any
equity securities) or rights to acquire any equity securities, other than
(X) the issuance of equity securities by a Subsidiary to the Company or
another Subsidiary or (Y) the issuance of options and common stock by the
Company pursuant to a stock option plan approved by the Majority Member;
(ii) merge or consolidate with any Person or permit any Subsidiary
to merge or consolidate with any Person (other than a wholly owned
Subsidiary);
(iii) sell, lease or otherwise dispose of, or permit any Subsidiary
to sell, lease or otherwise dispose of, more than 5% of the consolidated
assets of the Company and its Subsidiaries (computed on the basis of book
value, determined in accordance with generally accepted accounting
principles consistently applied, or fair market value, determined by the
Board in its reasonable good faith judgment) in any transaction or series
of related transactions (other than sales of inventory in the ordinary
course of business);
(iv) liquidate, dissolve or effect a recapitalization or
reorganization in any form of transaction (including any reorganization
into a limited liability company, a partnership or any other non-corporate
entity which is treated as a partnership for federal income tax purposes);
(v) acquire, or permit any Subsidiary to acquire, any interest in
any business (whether by a purchase of assets, purchase of stock, merger or
otherwise), or enter into any joint venture;
(vi) enter into, or permit any Subsidiary to enter into, any
transaction with any of its or any Subsidiary's officers, directors,
employees or Affiliates or any individual related by blood, marriage or
adoption to any such Person (a "RELATIVE") or any entity in which any such
Person or individual owns a beneficial interest (a "RELATED ENTITY"),
except (X) employment arrangements as approved by the Board and (Y) as
otherwise expressly contemplated by this Agreement; or
(vii) except as expressly contemplated by this Agreement, make any
amendment to the Certificate of Incorporation, Bylaws or the other
agreements contemplated hereby, or file any resolution of the Board with
the Secretary of the State of
Delaware, in each case containing any
provisions which would increase the number of authorized shares of Stock or
adversely affect or otherwise impair the rights or the
5
relative preferences and priorities of the holders of the Stock under this
Agreement, the Certificate of Incorporation, the Bylaws or the other
agreements contemplated hereby.
3D. AMENDMENT OF OTHER AGREEMENTS. The Company shall not amend,
modify or waive, or permit to be amended, modified or waived, any provision of
this Agreement, the Acquisition Agreement, the Bank Agreement, the Certificate
of Incorporation or any other agreement with key executives of the Company
without the prior written consent of the Majority Member.
3E. UNRELATED BUSINESS TAXABLE INCOME. The Company shall not engage
in any transaction which is reasonably likely to cause the Majority Member or
any of its limited partners which are exempt from income taxation under Section
501(a) of the IRC and, if applicable, any pension plan that any such trust may
be a part of, to recognize unrelated business taxable income as defined in
Section 512 and Section 514 of the IRC.
3F. ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ COMPLIANCE. In connection with any
transaction in which the Company is involved (a "TRANSACTION") which is required
to be reported under the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Antitrust Improvements Act of 1976,
as amended from time to time (the "HSR ACT"), the Company shall prepare and file
all documents with the Federal Trade Commission and the United States Department
of Justice which may be required to comply with the HSR Act, and shall promptly
furnish all materials thereafter requested by any of the regulatory agencies
having jurisdiction over such filings, in connection with a Transaction. The
Company shall take all reasonable actions and shall file and use reasonable best
efforts to have declared effective or approved all documents and notifications
with any governmental or regulatory bodies, as may be necessary or may
reasonably be requested under federal antitrust laws for the consummation of the
Transaction. Notwithstanding the foregoing, if the Majority Member, rather than
the Company, is required to make a filing under the HSR Act in connection with a
Transaction, the Company will notify the Majority Member that a filing is
necessary. In such instance the Majority Member shall make such filing, and the
Company will provide to the Majority Member all necessary information for such
filing, will facilitate such filing and will pay all fees associated with such
filing.
Section 4. TRANSFER OF RESTRICTED SECURITIES.
4A. Restricted Securities are transferable only pursuant to (i)
public offerings registered under the Securities Act, (ii) Rule 144 of the
Securities and Exchange Commission (or any similar rule or rules then in force)
if such rule or rules are available and (iii) subject to the conditions
specified in SECTION 4B below, any other legally available means of transfer.
4B. In connection with the transfer of any Restricted Securities
(other than a transfer described in SECTIONS 4A(i) or (ii) above), the holder
thereof shall deliver written notice to the Company describing in reasonable
detail the transfer or proposed transfer, together with an opinion of ▇▇▇▇▇▇▇▇ &
▇▇▇▇▇ or other counsel which (to the Company's reasonable satisfaction) is
knowledgeable in securities law matters to the effect that such transfer of
Restricted Securities may be effected without registration of such Restricted
Securities under the Securities Act. In addition, if the holder of the
Restricted Securities delivers to the Company an opinion of ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇ or
such other counsel that no subsequent transfer of such Restricted Securities
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shall require registration under the Securities Act, the Company shall promptly
upon such contemplated transfer deliver new certificates for such Restricted
Securities which do not bear the Securities Act legend set forth in SECTION 7C.
If the Company is not required to deliver new certificates for such Restricted
Securities not bearing such legend, the holder thereof shall not transfer the
same until the prospective transferee has confirmed to the Company in writing
its agreement to be bound by the conditions contained in this SECTION 4 and
SECTION 7C.
Section 5. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. As a
material inducement to the Purchaser to enter into this Agreement and purchase
the Stock, the Company hereby represents and warrants to the Purchaser that:
5A. ORGANIZATION AND CORPORATE POWER. The Company is a corporation
duly organized, validly existing and in good standing under the laws of
Delaware
and is qualified to do business in every jurisdiction in which the failure to so
qualify might reasonably be expected to have a material adverse effect on the
financial condition, operating results, assets, operations or business prospects
of the Company and its Subsidiaries taken as a whole. The Company has all
requisite corporate power and authority and all material licenses, permits and
authorizations necessary to own and operate its properties, to carry on its
businesses as now conducted and presently proposed to be conducted and to carry
out the transactions contemplated by this Agreement. The copies of the Company's
Certificate of Incorporation and Bylaws which have been furnished to the
Purchaser's counsel reflect all amendments made thereto at any time prior to the
date of this Agreement and are correct and complete.
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5B. CAPITAL STOCK AND RELATED MATTERS.
(i) As of the Closing and immediately thereafter, the authorized
capital stock of the Company shall consist of 101,300,000 shares of Stock,
of which 300,000 shares shall be designated as Preferred Stock (240,479.70
of which shall be issued and outstanding and 59,520.30 of which shall be
reserved for issuance pursuant to SECTION 1B(ii)), and of which 100,000,000
shares shall be designated as Class A Common Stock (99,000,000 of which
shall be issued and outstanding, and 1,000,000 of which shall be reserved
for issuances upon the conversion of the Class B Common), and of which
1,000,000 shares shall be designated as Class B Common Stock and which
shall be reserved for issuances pursuant to the Option Plan. As of the
Closing, the Company shall not have outstanding any stock or securities
convertible or exchangeable for any shares of its capital stock or
containing any profit participation features, nor shall it have outstanding
any rights or options to subscribe for or to purchase its capital stock or
any stock or securities convertible into or exchangeable for its capital
stock or any stock appreciation rights or phantom stock plans other than
pursuant to and as contemplated by this Agreement. As of the Closing, the
Company shall not be subject to any obligation (contingent or otherwise) to
repurchase or otherwise acquire or retire any shares of its capital stock
or any warrants, options or other rights to acquire its capital stock,
except pursuant to this Agreement and the Company's Certificate of
Incorporation. As of the Closing, all of the outstanding shares of the
Company's capital stock shall be validly issued, fully paid and
nonassessable.
(ii) There are no statutory or, to the best of the Company's
knowledge, contractual stockholders preemptive rights or rights of refusal
with respect to the issuance of the Stock hereunder or the issuance of the
Stock pursuant to SECTION 1B, except as expressly contemplated in the
Stockholders Agreement or provided herein. Based in part on the investment
representations of the Purchaser in SECTION 7C hereof, the Company has not
violated any applicable federal or state securities laws in connection with
the offer, sale or issuance of any of its capital stock, and the offer,
sale and issuance of the Stock hereunder and pursuant to SECTION 1B hereof
do not and will not require registration under the Securities Act or any
applicable state securities laws.
5C. SUBSIDIARIES; INVESTMENTS. Other than any securities acquired
or to be acquired pursuant to the Acquisition Agreement, the Company does not
own or hold any shares of stock or any other security or interest in any other
Person or any rights to acquire any such security or interest, and the Company
has never had any Subsidiary.
5D. AUTHORIZATION; NO BREACH. The execution, delivery and
performance of this Agreement, the Acquisition Agreement and all other
agreements contemplated hereby to which the Company is a party have been duly
authorized by the Company. This Agreement, , the Acquisition Agreement, the
Certificate of Incorporation and all other agreements contemplated hereby each
constitutes a valid and binding obligation of the Company, enforceable in
accordance with its terms. The execution and delivery by the Company of this
Agreement, the Acquisition Agreement and all other agreements contemplated
hereby to which the Company is a party, the offering, sale and issuance of the
Stock hereunder and pursuant to SECTION 1B and the fulfillment of and compliance
with the respective terms hereof and thereof by
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the Company do not and will not (i) conflict with or result in a breach of the
terms, conditions or provisions of, (ii) constitute a default under, (iii)
result in the creation of any lien, security interest, charge or encumbrance
upon the Company's capital stock or assets pursuant to, (iv) give any third
party the right to modify, terminate or accelerate any obligation under, (v)
result in a violation of, or (vi) require any authorization, consent, approval,
exemption or other action by or notice to any court or administrative or
governmental body pursuant to, the Certificate of Incorporation or the Bylaws or
any law, statute, rule or regulation to which the Company is subject, or any
agreement, instrument, order, judgment or decree to which the Company is a party
or by which it is bound.
5E. CONDUCT OF BUSINESS; LIABILITIES. Other than the negotiation,
execution and delivery of this Agreement, the Acquisition Agreement and the
other agreements contemplated hereby and thereby, prior to the Closing, the
Company has not (i) conducted any business, (ii) incurred any expenses,
obligations or liabilities (whether accrued, absolute, contingent, unliquidated
or otherwise, whether or not known to the Company and whether due or to become
due and regardless of when asserted), (iii) owned any assets, (iv) entered into
any contracts or agreements, or (v) violated any laws or governmental rules or
regulations.
5F. LITIGATION, ETC. Other than those items disclosed in the
schedules to the Acquisition Agreement, there are no actions, suits,
proceedings, orders, investigations or claims pending or, to the best of the
Company's knowledge, threatened against or affecting the Company (or to the best
of the Company's knowledge, pending or threatened against or affecting any of
the officers, directors or employees of the Company with respect to their
businesses or proposed business activities) at law or in equity, or before or by
any governmental department, commission, board, bureau, agency or
instrumentality with respect to the transactions contemplated by this Agreement.
5G. BROKERAGE. There are no claims for brokerage commissions,
finders, fees or similar compensation in connection with the transactions
contemplated by this Agreement based on any arrangement or agreement binding
upon the Company. The Company shall pay, and hold the Purchaser harmless
against, any liability, loss or expense (including, without limitation,
attorneys, fees and out-of-pocket expenses) arising in connection with any such
claim.
5H. GOVERNMENTAL CONSENT, ETC. No permit, consent, approval or
authorization of, or declaration to or filing with, any governmental authority
is required in connection with the execution, delivery and performance by the
Company of this Agreement or the other agreements contemplated hereby, or the
consummation by the Company of any other transactions contemplated hereby or
thereby.
5I. DISCLOSURE. Neither this Agreement nor any of the schedules,
attachments, written statements, documents, certificates or other items prepared
or supplied to the Purchaser by or on behalf of the Company with respect to the
transactions contemplated hereby contain any untrue statement of a material fact
or omit a material fact necessary to make each statement contained herein or
therein not misleading. There is no fact which the Company has not disclosed to
the Purchaser in writing and of which any of its officers, directors or
executive employees is aware and which has had or might reasonably be
anticipated to have a material
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adverse effect upon the existing or expected financial condition, operating
results, assets, customer or supplier relations, employee relations or business
prospects of the Company.
5J. CLOSING DATE. The representations and warranties of the Company
contained in this SECTION 5 and elsewhere in this Agreement and all information
contained in any exhibit, schedule or attachment hereto or in any writing
delivered by, or on behalf of, the Company to the Purchaser shall be true and
correct in all material respects on the date of the Closing as though then made,
except as affected by the transactions expressly contemplated by this Agreement.
Section 6. DEFINITIONS. For the purposes of this Agreement, the
following terms have the meanings set forth below:
"ACQUISITION AGREEMENT" means that certain
Stock Purchase Agreement
dated as of December 7, 2001, between Verizon Information Services Inc. and the
Company.
"AFFILIATE" of any particular person or entity means any other person
or entity controlling, controlled by or under common control with such
particular person or entity. For purposes of this Agreement, all holdings of
Preferred Stock and Common Stock by Persons who are Affiliates of each other
shall be aggregated for purposes of meeting any threshold tests under this
Agreement.
"BANK AGREEMENT" means that certain credit agreement dated February
14, 2002 among the Company, ▇▇▇▇▇▇ Brothers Inc. (as Administrative Agent) and
various lending institutions, as such agreement may be amended, restated,
extended, renewed, supplemented, refinanced, replaced or otherwise modified from
time to time (including, without limitation, by increasing the amount of
available borrowings thereunder or adding any direct or indirect Subsidiaries of
the borrowers as additional borrowers or guarantors thereunder) and whether by
the same or any other agent, lender or group of lenders.
"BOARD" means the Board of Directors of the Company.
"COMMON STOCK" means (i) the Class A Common Stock and Class B Common
Stock issued hereunder and (ii) any Common Stock issued or issuable with respect
to the Common Stock referred to in clause (i) above by way of stock dividends,
stock splits or in connection with a combination of shares, recapitalization,
merger, consolidation or other reorganization. As to any particular shares of
Investor Common, such shares shall cease to be Investor Common when they have
been (a) effectively registered under the Securities Act and disposed of in
accordance with the registration statement covering them or (b) distributed to
the public through a broker, dealer or market maker pursuant to Rule 144 under
the Securities Act (or any similar rule then in force).
"INVESTOR COMMON" shall have the meaning given to such term under the
Unit Purchase Agreement.
"INVESTOR PREFERRED" shall have the meaning given to such term under
the Unit Purchase Agreement.
10
"IRC" means the Internal Revenue Code of 1986, as amended, and any
reference to any particular IRC Section shall be interpreted to include any
revision of or successor to that Section regardless of how numbered or
classified.
"MAJORITY MEMBER" means GTCR Fund VII, L.P., a
Delaware limited
partnership.
"OFFICER'S CERTIFICATE" means a certificate signed by the Company's
president or its chief financial officer, stating that (i) the officer signing
such certificate has made or has caused to be made such investigations as are
necessary in order to permit him to verify the accuracy of the information set
forth in such certificate and (ii) to the best of such officer's knowledge, such
certificate does not misstate any material fact and does not omit to state any
fact necessary to make the certificate not misleading.
"OPTION PLAN" means the employee stock option plan of the Company as
approved and adopted by the Board from time to time.
"PERSON" means an individual, a partnership, a limited liability
company, a corporation, an association, a joint stock company, a trust, a joint
venture, an unincorporated organization and a governmental entity or any
department, agency or political subdivision thereof.
"PREFERRED STOCK" means (i) the Preferred Stock issued hereunder and
(ii) any Preferred Stock, issued or issuable with respect to the Preferred Stock
referred to in clause (i) above by way of stock dividends, stock splits or in
connection with a combination of shares, recapitalization, merger, consolidation
or other reorganization. As to any particular shares of Investor Preferred, such
shares shall cease to be Investor Preferred when they have been (a) effectively
registered under the Securities Act and disposed of in accordance with the
registration statement covering them or (b) distributed to the public through a
broker, dealer or market maker pursuant to Rule 144 under the Securities Act (or
any similar rule then in force).
"STOCK" means the Preferred Stock and the Common Stock.
"RESTRICTED SECURITIES" means (i) the Stock issued hereunder and
pursuant to SECTION 1B hereof and (ii) any securities issued with respect to the
securities referred to in clause (i) above by way of a stock dividend, stock
split or in connection with a combination of shares, recapitalization, merger,
consolidation or other reorganization. As to any particular Restricted
Securities, such securities shall cease to be Restricted Securities when they
have (a) been effectively registered under the Securities Act and disposed of in
accordance with the registration statement covering them, (b) become eligible
for sale pursuant to Rule 144(k) (or any similar provision then in force) under
the Securities Act or (c) been otherwise transferred and new certificates for
them not bearing the Securities Act legend set forth in SECTION 7C have been
delivered by the Company in accordance with SECTION 4B. Whenever any particular
securities cease to be Restricted Securities, the holder thereof shall be
entitled to receive from the Company, without expense, new securities of like
tenor not bearing a Securities Act legend of the character set forth in SECTION
7C.
"SECURITIES ACT" means the Securities Act of 1933, as amended, or any
similar federal law then in force.
11
"SECURITIES AND EXCHANGE COMMISSION" includes any governmental body or
agency succeeding to the functions thereof.
"SUBSIDIARY" means any corporation of which the securities having a
majority of the ordinary voting power in electing the board of directors are, at
the time as of which any determination is being made, owned by the Company
either directly or through one or more Subsidiaries.
"UNIT PURCHASE AGREEMENT" means that certain Unit Purchase Agreement
dated as of February 14, 2002, by and between the Purchaser, GTCR Fund VII, GTCR
Fund VII/A and GTCR Co-Invest.
Section 7. MISCELLANEOUS.
7A. EXPENSES. The Company agrees to pay, and hold the Purchaser and
all holders of Stock harmless against liability for the payment of, (i) the
reasonable fees and expenses of their counsel arising in connection with the
negotiation and execution of this Agreement and the Acquisition Agreement and
the consummation of the transactions contemplated by this Agreement and the
Acquisition Agreement, (ii) the fees and expenses incurred with respect to any
amendments or waivers (whether or not the same become effective) under or in
respect of this Agreement, the Acquisition Agreement, the other agreements
contemplated hereby and the Certificate of Incorporation, (iii) stamp and other
taxes which may be payable in respect of the execution and delivery of this
Agreement or the issuance, delivery or acquisition of any shares of Stock
purchased hereunder, (iv) the fees and expenses incurred with respect to the
interpretation or enforcement of the rights granted under this Agreement and the
other agreements contemplated hereby and the Certificate of Incorporation and
the Bylaws and (v) such reasonable travel expenses, legal fees and other
out-of-pocket fees and expenses as have been or may be incurred by the
Purchaser, its Affiliates, its members, its members' Affiliates and their
directors, officers and employees in connection with any Company-related
financing and in connection with the rendering of any other services by the
Purchaser, its members or their Affiliates (including fees and expenses incurred
in attending Board or other Company-related meetings).
7B. REMEDIES. Each holder of Stock shall have all rights and
remedies set forth in this Agreement and the Certificate of Incorporation and
all rights and remedies which such holders have been granted at any time under
any other agreement or contract and all of the rights which such holders have
under any law. Any Person having any rights under any provision of this
Agreement shall be entitled to enforce such rights specifically (without posting
a bond or other security), to recover damages by reason of any breach of any
provision of this Agreement and to exercise all other rights granted by law.
7C. PURCHASER'S INVESTMENT REPRESENTATIONS. The Purchaser hereby
represents (i) that it is acquiring the Restricted Securities purchased
hereunder or acquired pursuant hereto for its own account with the present
intention of holding such securities for purposes of investment, and that it has
no intention of selling such securities in a public distribution in violation of
the federal securities laws or any applicable state securities laws, (ii) that
it is an "accredited investor" and a sophisticated investor for purposes of
applicable U.S. federal and
12
state securities laws and regulations, (iii) that this Agreement and each of the
other agreements contemplated hereby constitutes (or will constitute) the legal,
valid and binding obligation of the Purchaser, enforceable in accordance with
its terms, and (iv) that the execution, delivery and performance of this
Agreement and such other agreements by the Purchaser does not and will not
conflict with, violate or cause a breach of any agreement, contract or
instrument to which the Purchaser is subject. Notwithstanding the foregoing,
nothing contained herein shall prevent the Purchaser and subsequent holders of
Restricted Securities from transferring such securities in compliance with the
provisions of SECTION 4 hereof. Each certificate for Restricted Securities shall
be imprinted with a legend in substantially the following form:
"The securities represented by this certificate were originally issued
on February 14, 2002 and have not been registered under the Securities
Act of 1933, as amended. The transfer of the securities represented by
this certificate is subject to the conditions specified in the
Stock
Purchase Agreement, dated as of February 14, 2002 by and among the
issuer (the "COMPANY") and certain investors, and the Company reserves
the right to refuse the transfer of such securities until such
conditions have been fulfilled with respect to such transfer. A copy
of such conditions shall be furnished by the Company to the holder
hereof upon written request and without charge."
7D. CONSENT TO AMENDMENTS. Except as otherwise expressly provided
herein, the provisions of this Agreement may be amended and the Company may take
any action herein prohibited, or omit to perform any act herein required to be
performed by it, only if the Company has obtained the written consent of the
Majority Member. No other course of dealing between the Company and the holder
of any Stock or any delay in exercising any rights hereunder or under the
Certificate of Incorporation shall operate as a waiver of any rights of any such
holders. For purposes of this Agreement, shares of Stock held by the Company or
any Subsidiaries shall not be deemed to be outstanding.
7E. SURVIVAL OF REPRESENTATIONS AND WARRANTIES. All representations
and warranties contained herein or made in writing by any party in connection
herewith shall survive the execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby, regardless of any
investigation made by the Purchaser or on its behalf.
7F. SUCCESSORS AND ASSIGNS. Except as otherwise expressly provided
herein, all covenants and agreements contained in this Agreement by or on behalf
of any of the parties hereto shall bind and inure to the benefit of the
respective successors and assigns of the parties hereto whether so expressed or
not. In addition, and whether or not any express assignment has been made, the
provisions of this Agreement which are for the Purchaser's benefit as a
purchaser or holder of Stock are also for the benefit of, and enforceable by,
any subsequent holder of such Stock. The rights and obligations of the Purchaser
under this Agreement and the agreements contemplated hereby may be assigned by
the Purchaser at any time, in whole or in part, to any of its members or any
successor thereto.
7G. GENERALLY ACCEPTED ACCOUNTING PRINCIPLES. Where any accounting
determination or calculation is required to be made under this Agreement or the
exhibits hereto,
13
such determination or calculation (unless otherwise provided) shall be made in
accordance with generally accepted accounting principles, consistently applied,
except that if because of a change in generally accepted accounting principles
the Company would have to alter a previously utilized accounting method or
policy in order to remain in compliance with generally accepted accounting
principles, such determination or calculation shall continue to be made in
accordance with the Company's previous accounting methods and policies.
7H. SEVERABILITY. Whenever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be prohibited
by or invalid under applicable law, such provision shall be ineffective only to
the extent of such prohibition or invalidity, without invalidating the remainder
of this Agreement.
7I. COUNTERPARTS. This Agreement may be executed simultaneously in
two or more counterparts, any one of which need not contain the signatures of
more than one party, but all such counterparts taken together shall constitute
one and the same Agreement.
7J. ENTIRE AGREEMENT. This Agreement, those documents expressly
referred to herein and other documents of even date herewith embody the complete
agreement among the parties and supersede and preempt any prior understandings,
agreements or representations by or among the parties, written or oral, which
may have related to the subject matter hereof in any way.
7K. DESCRIPTIVE HEADINGS; INTERPRETATION. The descriptive headings
of this Agreement are inserted for convenience only and do not constitute a
section of this Agreement. The use of the word "including" in this Agreement
shall be by way of example rather than by limitation.
7L. GOVERNING LAW. The corporate law of
Delaware shall govern all
issues concerning the relative rights of the Company and its stockholders. All
other questions concerning the construction, validity and interpretation of this
Agreement and the exhibits and schedules hereto shall be governed by and
construed in accordance with the internal laws of the State of
Delaware, without
giving effect to any choice of law or conflict of law provision or rule (whether
of the State of
Delaware or any other jurisdiction) that would cause the
application of the laws of any jurisdiction other than the State of Delaware.
7M. NOTICES. All notices, demands or other communications to be
given or delivered under or by reason of the provisions of this Agreement shall
be in writing and shall be deemed to have been given when delivered personally
to the recipient, sent to the recipient by reputable express courier service
(charges prepaid) or mailed to the recipient by certified or registered mail,
return receipt requested and postage prepaid. Such notices, demands and other
communications shall be sent to the Purchaser and to the Company at the address
indicated below:
IF TO THE COMPANY:
14
TSI Telecommunication Holdings, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: G. ▇▇▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
AND
TSI Telecommunication Holdings, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇, Jr.
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
WITH COPIES TO:
GTCR Fund VII, L.P.
GTCR Fund VII/A, L.P.
GTCR Co-Invest, L.P.
c/o GTCR ▇▇▇▇▇▇ ▇▇▇▇▇▇, L.L.C.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
AND
▇▇▇▇▇▇▇▇ & ▇▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
15
IF TO THE PURCHASER:
TSI Telecommunication Holdings, LLC
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: G. ▇▇▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
WITH COPIES TO:
GTCR Fund VII, L.P.
GTCR Fund VII/A, L.P.
GTCR Co-Invest, L.P.
c/o GTCR ▇▇▇▇▇▇ ▇▇▇▇▇▇, L.L.C.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
AND
▇▇▇▇▇▇▇▇ & ▇▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
or to such other address or to the attention of such other person as the
recipient party has specified by prior written notice to the sending party.
* * * * *
16
IN WITNESS WHEREOF, the parties hereto have executed this Purchase
Agreement on the date first written above.
TSI TELECOMMUNICATION HOLDINGS, INC.
By: /s/ G. ▇▇▇▇▇▇ ▇▇▇▇▇
Name: G. ▇▇▇▇▇▇ ▇▇▇▇▇
Its: Chief Executive Officer
TSI TELECOMMUNICATION HOLDINGS, LLC
By: /s/ G. ▇▇▇▇▇▇ ▇▇▇▇▇
Name: G. ▇▇▇▇▇▇ ▇▇▇▇▇
Its: Chief Executive Officer