1
EXHIBIT 2.2
--------------------------------------------------------------------------------
AGREEMENT AND PLAN OF REORGANIZATION
DATED AS OF AUGUST 26, 2000
BETWEEN
VOICESTREAM WIRELESS CORPORATION
AND
POWERTEL, INC.
--------------------------------------------------------------------------------
2
TABLE OF CONTENTS
PAGE
----
ARTICLE I -- THE REORGANIZATION............................. 2
Section 1.01 The Merger.................................. 2
Section 1.02 Closing..................................... 2
Section 1.03 Effective Time.............................. 2
Section 1.04 Effects of the Merger....................... 2
Section 1.05 Restated Certificate of Incorporation and
By-laws; Officers and Directors........................ 2
Section 1.06 Effect on Stock............................. 3
Section 1.07 Surrender of Certificates................... 4
ARTICLE II -- REPRESENTATIONS AND WARRANTIES OF POWERTEL.... 6
Section 2.01 Organization................................ 6
Section 2.02 Subsidiaries................................ 7
Section 2.03 Capital Structure........................... 7
Section 2.04 Authority................................... 8
Section 2.05 Consents and Approvals; No Violations....... 9
Section 2.06 SEC Documents and Other Reports............. 9
Section 2.07 Absence of Material Adverse Change.......... 10
Section 2.08 Information Supplied........................ 10
Section 2.09 Permits; Compliance with Laws............... 10
Section 2.10 Tax Matters................................. 11
Section 2.11 Liabilities................................. 12
Section 2.12 Benefit Plans; Employees and Employment
Practices.............................................. 12
Section 2.13 Litigation.................................. 14
Section 2.14 Environmental Matters....................... 15
Section 2.15 Section 203 of DGCL......................... 15
Section 2.16 Intellectual Property....................... 15
Section 2.17 Opinion of Financial Advisor................ 15
Section 2.18 Brokers..................................... 16
Section 2.19 Tax Status.................................. 16
Section 2.20 Contracts................................... 16
Section 2.21 Vote Required............................... 16
Section 2.22 Transactions with Affiliates................ 17
ARTICLE III -- REPRESENTATIONS AND WARRANTIES OF
VOICESTREAM............................................... 17
Section 3.01 Organization................................ 17
Section 3.02 Ownership of Sub............................ 17
Section 3.03 Capital Structure........................... 17
Section 3.04 Authority................................... 18
Section 3.05 Consents and Approvals; No Violations....... 19
Section 3.06 SEC Documents and Other Reports............. 19
Section 3.07 Absence of Material Adverse Change.......... 20
Section 3.08 Information Supplied........................ 20
Section 3.09 Permits; Compliance with Laws............... 20
Section 3.10 Tax Matters................................. 21
Section 3.11 Liabilities................................. 22
Section 3.12 Litigation.................................. 22
Section 3.13 State Takeover Statutes..................... 22
Section 3.14 Brokers..................................... 22
i
3
PAGE
----
Section 3.15 Tax Status.................................. 22
Section 3.16 Interim Operations and Performance of Sub... 22
Section 3.17 Vote Required............................... 22
Section 3.18 Transactions with Affiliates................ 22
Section 3.19 Opinion of ▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co.............. 23
ARTICLE IV -- COVENANTS RELATING TO CONDUCT OF BUSINESS..... 23
Section 4.01 Conduct of Business by Powertel Pending the
Reorganization......................................... 23
Section 4.02 Conduct of Business by VoiceStream Pending
the Reorganization..................................... 25
Section 4.03 No Solicitation............................. 26
Section 4.04 Disclosure of Certain Matters; Delivery of
Certain Filings........................................ 27
Section 4.05 Tax Status.................................. 27
Section 4.06 Control of Operations....................... 27
Section 4.07 Powertel Merger Agreement................... 27
ARTICLE V -- ADDITIONAL AGREEMENTS.......................... 28
Section 5.01 Employee Benefits........................... 28
Section 5.02 Options; Restricted Stock Awards............ 29
Section 5.03 Stockholders Meetings....................... 30
Section 5.04 Preparation of the Registration Statement
and Joint Proxy Statement.............................. 31
Section 5.05 Notification of Receipt of Proxy............ 31
Section 5.06 Comfort Letters............................. 31
Section 5.07 Access to Information....................... 32
Section 5.08 Compliance with the Securities Act.......... 32
Section 5.09 Nasdaq Listings............................. 32
Section 5.10 Fees and Expenses........................... 32
Section 5.11 Public Announcements........................ 33
Section 5.12 State Takeover Laws......................... 33
Section 5.13 Indemnification; Directors and Officers
Insurance.............................................. 33
Section 5.14 Reasonable Best Efforts..................... 34
Section 5.15 Certain Litigation.......................... 36
Section 5.16 Powertel Stockholder Agreement and
VoiceStream Stockholder Agreement...................... 36
Section 5.17 Senior Discount Notes and Senior Notes...... 36
Section 5.18 Plans and Programs to be Implemented........ 36
Section 5.19 Registration Rights......................... 37
ARTICLE VI -- CONDITIONS PRECEDENT.......................... 37
Section 6.01 Conditions to Each Party's Obligation to
Effect the Reorganization.............................. 37
Section 6.02 Additional Conditions to Obligation of
Powertel to Effect the Reorganization.................. 37
Section 6.03 Conditions to Obligations of VoiceStream and
Sub to Effect the Reorganization....................... 38
ARTICLE VII -- TERMINATION AND AMENDMENT.................... 39
Section 7.01 Termination................................. 39
Section 7.02 Effect of Termination....................... 40
Section 7.03 Amendment................................... 40
Section 7.04 Extension; Waiver........................... 40
ARTICLE VIII -- GENERAL PROVISIONS.......................... 41
Section 8.01 Non-Survival of Representations and
Warranties and Agreements.............................. 41
Section 8.02 Notices..................................... 41
Section 8.03 Interpretation; Definitions................. 42
Section 8.04 Counterparts................................ 49
Section 8.05 Entire Agreement; No Third-Party
Beneficiaries.......................................... 49
ii
4
PAGE
----
Section 8.06 Governing Law............................... 49
Section 8.07 Assignment.................................. 49
Section 8.08 Severability................................ 49
Section 8.09 Enforcement of this Agreement............... 50
Section 8.10 Obligations of Subsidiaries................. 50
Section 8.11 Reliance on Representations................. 50
Section 8.12 Failure or Indulgence Not Waiver; Remedies
Cumulative............................................. 50
Section 8.13 Rules of Construction....................... 50
ANNEX A RESTATED CERTIFICATE OF INCORPORATION
ANNEX B RESTATED BY-LAWS
ANNEX C FORM OF RULE 145 AFFILIATE AGREEMENT
ANNEX D FORM OF VOICESTREAM FCC COUNSEL OPINION
ANNEX E FORM OF POWERTEL FCC COUNSEL OPINION
ANNEX F TAX CERTIFICATE OF POWERTEL
ANNEX G TAX CERTIFICATE OF VOICESTREAM
ANNEX 5.18 PLANS AND PROGRAMS TO BE IMPLEMENTED
iii
5
EXECUTION COPY
AGREEMENT AND PLAN OF REORGANIZATION
AGREEMENT AND PLAN OF REORGANIZATION dated as of August 26, 2000 (this
"Agreement") between VoiceStream Wireless Corporation, a Delaware corporation
("VoiceStream"), and Powertel, Inc., a Delaware corporation ("Powertel"). Except
as otherwise set forth herein, capitalized (and certain other) terms used herein
shall have the meanings set forth in Section 8.03.
WITNESSETH:
WHEREAS, VoiceStream and Deutsche Telekom AG, an AKTIENGESELLSCHAFT ("DT")
entered into an Agreement and Plan of Merger dated as of July 23, 2000 (as
amended or modified from time to time, the "DT Merger Agreement"), providing for
the acquisition of VoiceStream by DT (the "DT Merger");
WHEREAS, Powertel and DT are as of this date entering into a separate
merger agreement (as amended or modified from time to time, the "Powertel Merger
Agreement"), providing for the acquisition of Powertel by DT (the "Powertel
Merger"), subject to certain closing conditions, including the consummation of
the DT Merger;
WHEREAS, VoiceStream and Powertel desire to provide for the acquisition of
Powertel by VoiceStream upon the terms and conditions set forth in this
Agreement in the event the DT Merger is not consummated;
WHEREAS, the reorganization provided for herein (the "Reorganization")
shall include the merger (the "Merger") of a wholly owned subsidiary of
VoiceStream ("Sub") with and into Powertel and, if applicable, the other
transactions described below and shall only take place if the DT Merger
Agreement has previously terminated;
WHEREAS, the respective Boards of Directors of VoiceStream and Powertel
have approved and declared advisable the Reorganization, upon the terms and
subject to the conditions herein set forth whereby each issued and outstanding
share of common stock of Powertel, $0.01 par value (the "Powertel Common
Stock"), and each issued and outstanding share of preferred stock of Powertel
(whether or not such shares of preferred stock are or become convertible into
Powertel Common Stock prior to the Effective Time), $0.01 par value per share
and together with all accrued and unpaid dividends thereon (calculated as if the
Closing Date were a dividend payment date) (the "Powertel Preferred Stock," and
collectively with Powertel Common Stock, the "Powertel Stock"), other than
shares of Powertel Stock owned directly or indirectly by VoiceStream or
Powertel, will be converted into shares of common stock, $0.001 par value, of
VoiceStream (the "VoiceStream Common Stock");
WHEREAS, the respective Boards of Directors of VoiceStream and Powertel
have determined that the Reorganization is in furtherance of and consistent with
their respective long-term business strategies and is fair to and in the best
interests of their respective stockholders;
WHEREAS, for federal income tax purposes, it is intended that the Merger
shall qualify as a reorganization within the meaning of Section 368(a) of the
Code;
WHEREAS, as a condition to the willingness of, and as an inducement to,
VoiceStream to enter into this Agreement, contemporaneously with the execution
and delivery of this Agreement certain holders of Powertel Stock are each
entering into a stockholder agreement dated as of the date hereof (each a
"Powertel Stockholder Agreement"), providing for certain actions relating to the
transactions contemplated by this Agreement;
WHEREAS, as a condition to the willingness of, and as an inducement to,
Powertel to enter into this Agreement, contemporaneously with the execution and
delivery of this Agreement certain holders of VoiceStream Common Stock and
preferred stock of VoiceStream are each entering into a voting agreement
-1-
6
dated as of the date hereof (each a "VoiceStream Stockholder Agreement"),
providing for certain actions relating to the transactions contemplated by this
Agreement; and
WHEREAS, VoiceStream and Powertel desire to make certain representations,
warranties, covenants and agreements in connection with the Reorganization and
also to prescribe various conditions to the Reorganization.
NOW, THEREFORE, in consideration of the foregoing and the mutual covenants
and agreements herein contained, and intending to be legally bound hereby,
VoiceStream and Powertel hereby agree as follows:
ARTICLE I
THE REORGANIZATION
SECTION 1.01 The Merger. As soon as practicable after the date hereof, Sub
shall be formed by VoiceStream as a Delaware corporation, and all of the
outstanding shares of capital stock of Sub shall be issued to VoiceStream. Upon
the terms and subject to the conditions hereof, and in accordance with the DGCL,
in the Reorganization, Sub shall be merged with and into Powertel at the
Effective Time. Following the Effective Time, the separate corporate existence
of Sub shall cease, and Powertel shall continue as the surviving corporation
(the "Surviving Corporation") and shall succeed to and assume all the rights and
obligations of Sub and Powertel in accordance with the DGCL.
SECTION 1.02 Closing. The closing (the "Closing") of the Merger will take
place at 10:00 a.m., Seattle time, on the fifth Business Day after satisfaction
or waiver of the conditions set forth in Article VI (excluding conditions that,
by their terms, cannot be satisfied except at the Closing), at the offices of
▇▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇▇ LLP, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇,
unless this Agreement shall have been terminated and the transactions
contemplated by this Agreement abandoned pursuant to Article VII or unless
another date, time or place is agreed to in writing by the parties hereto. The
date on which the Closing takes place is herein referred to as the "Closing
Date."
SECTION 1.03 Effective Time. The Merger shall become effective when a
Certificate of Merger (the "Certificate of Merger"), executed in accordance with
the relevant provisions of the DGCL, is duly filed with the Secretary of State
of the State of Delaware, or at such other time as Sub and Powertel shall agree
should be specified in the Certificate of Merger. The term "Effective Time"
shall mean the later of the date and time at which the Certificate of Merger is
duly filed with the Secretary of State of the State of Delaware or such other
time established by the Certificate of Merger. The filing of the Certificate of
Merger shall be made on the Closing Date as soon as practicable after the
satisfaction or waiver of the conditions set forth herein.
SECTION 1.04 Effects of the Merger. At the Effective Time, the effect of
the Merger shall be as provided in this Agreement and in the applicable
provisions of the DGCL. Without limiting the generality of the foregoing, and
subject thereto, at the Effective Time, all the assets, property, rights,
privileges, immunities, powers and franchises of Powertel and Sub shall vest in
the Surviving Corporation, and all debts, liabilities and duties of Powertel and
Sub shall become the debts, liabilities and duties of the Surviving Corporation.
SECTION 1.05 Restated Certificate of Incorporation and By-laws; Officers
and Directors.
(a) The Restated Certificate of Incorporation of Powertel, as in effect
immediately prior to the Effective Time, shall be amended as of the Effective
Time as set forth on Annex A hereto. As so amended, such Restated Certificate of
Incorporation shall be the Certificate of Incorporation of the Surviving
Corporation until thereafter changed or amended as provided therein or by
applicable law.
(b) The Restated By-laws of Powertel, as in effect immediately prior to the
Effective Time, shall be amended as of the Effective Time as set forth on Annex
B hereto. As so amended, such Restated By-laws shall be the By-laws of the
Surviving Corporation until thereafter changed or amended as provided therein or
by applicable law.
-2-
7
(c) The directors of Sub immediately prior to the Effective Time shall be
the directors of the Surviving Corporation, until the next annual meeting of
stockholders (or the earlier of their resignation or removal) and until their
respective successors are duly elected and qualified, as the case may be.
(d) The officers of Sub immediately prior to the Effective Time shall be
the officers of the Surviving Corporation until the earlier of their resignation
or removal and until their respective successors are duly elected and qualified,
as the case may be.
SECTION 1.06 Effect on Stock. As of the Effective Time, by virtue of the
Merger and without any action on the part of any party hereto or the holders of
any securities of Powertel and Sub:
(a) Capital Stock of Sub. Each issued and outstanding share of capital
stock of Sub shall be converted into and become one validly issued, fully
paid and nonassessable share of common stock, no par value, of the
Surviving Corporation.
(b) Treasury Stock and VoiceStream Owned Stock. Each share of Powertel
Stock that is owned by Powertel or by any Powertel Subsidiary and each
share of Powertel Stock that is owned by VoiceStream, Sub or any other
VoiceStream Subsidiary shall automatically be cancelled and retired and
shall cease to exist, and no consideration shall be delivered in exchange
therefor.
(c) Conversion of Powertel Stock. At the Effective Time: (i) each
share of Powertel Common Stock issued and outstanding shall be converted
automatically into the right to receive a number (as calculated below, the
"Conversion Number") of validly issued, fully paid and nonassessable shares
of VoiceStream Common Stock; and (ii) each share of Powertel Preferred
Stock issued and outstanding, whether or not such share is convertible by
its terms as of the Effective Time, shall be converted automatically into
the right to receive a number of shares of validly issued, fully paid and
nonassessable shares of VoiceStream Common Stock determined by multiplying
(A) the Conversion Number by (B) the sum of (1) the number of shares of
Powertel Common Stock into which such share of Powertel Preferred Stock
would be converted as of the Effective Time, if such share were then
convertible and had been converted, plus (2) with respect to the Series E
Preferred Shares and Series F Preferred Shares, the number of shares of
Powertel Common Stock that represent accrued or declared but unpaid
dividends on such shares (calculated as if the Closing Date were a dividend
payment date). The Conversion Number shall be determined as follows: (i)
0.75 if the VoiceStream Average Closing Price is $113.33 or below; (ii)
0.65 if the VoiceStream Average Closing Price is $130.77 or above; and
(iii) if the VoiceStream Average Closing Price is greater than $113.33 and
less than $130.77, the quotient determined by dividing $85.00 by the
VoiceStream Average Closing Price. The "VoiceStream Average Closing Price"
shall mean the volume weighted average closing price (based on the Nasdaq
National Market System ("Nasdaq") composite volume published by the Wall
Street Journal) of the VoiceStream Common Stock as publicly reported for
the Nasdaq as of 4:00 p.m. Eastern Time for ten (10) trading days randomly
selected by lot out of the last twenty (20) trading days ending five (5)
trading days prior to the Closing Date. As of the Effective Time, all such
shares of Powertel Stock shall be converted in accordance with this
paragraph, and when so converted, shall no longer be outstanding and shall
automatically be cancelled and retired and shall cease to exist, and each
holder of a certificate representing any such shares of Powertel Stock
shall cease to have any rights with respect thereto, except the right to
receive (i) certificates representing the shares of VoiceStream Common
Stock into which such shares of Powertel Stock have been converted, (ii)
any dividends and other distributions in accordance with Section 1.07(d)
and (iii) any cash, without interest, to be paid in lieu of any fractional
share of VoiceStream Common Stock in accordance with Section 1.07(e). Item
1.06(c) of the Powertel Letter sets forth a pro forma calculation of the
conversion of Powertel Common Stock and each outstanding Powertel Common
Stock Equivalent (including the corresponding conversion ratios with
respect to each series of Powertel Preferred Stock) into VoiceStream Common
Stock or VoiceStream Equity Rights as of the date hereof.
(d) Assumption of Options, Warrants and Puts. Subject to Section 5.02
hereof, Powertel and VoiceStream shall take all requisite action such that,
at the Effective Time, (i) all Powertel Stock Options outstanding at the
Effective Time, (ii) all obligations of Powertel with respect to the
warrants (the "Powertel Warrants") to purchase Powertel Common Stock issued
by Powertel pursuant to the
-3-
8
Warrant Agreement (the "Warrant Agreement") dated February 7, 1996 between
Powertel and Bankers Trust Company, as warrant agent, outstanding at the
Effective Time, (iii) all obligations with respect to the Stock Purchase
Agreement and the Put Agreement, each dated May 30, 2000 between Powertel
and Sonera Holding B.V. (together, the "Sonera Put") and (iv) all
obligations with respect to the Put Agreement dated May 30, 2000 and
between Powertel, Eliska Wireless Investors I, L.P. and Sonera Holding B.V.
(the "Eliska Put" and together with the Sonera Put, the "Eliska Put
Rights") shall be specifically assumed by VoiceStream in writing.
(e) Adjustment of Conversion Number. In the event of any
reclassification, stock split or stock dividend with respect to VoiceStream
Common Stock, any change, exchange or conversion of VoiceStream Common
Stock into other securities or property, or any other dividend or
distribution with respect to VoiceStream Common Stock (other than normal
quarterly cash dividends as the same may be modified from time to time in
the ordinary course), or if a record date with respect to any of the
foregoing should occur, prior to the Effective Time, appropriate and
proportionate adjustments, if any, shall be made to the Conversion Number,
and thereafter all references in this Agreement to the Conversion Number
shall be deemed to be to the Conversion Number as so adjusted.
In the event that the aggregate number of shares of Powertel Common Stock
and Powertel Common Stock Equivalents ("Adjusted Fully Diluted Shares") exceeds
the Maximum Share Amount as of the Effective Time, excluding, for purposes of
this Section 1.06(e), Powertel Common Stock issuable after the date hereof and
prior to the Effective Time in respect of dividends accrued on the Series E
Preferred Shares and the Series F Preferred Shares, the Conversion Number shall
be adjusted by multiplying the Conversion Number otherwise applicable under
Section 1.06(c) by a fraction the numerator of which shall be the Maximum Share
Amount and the denominator of which shall be the number of Adjusted Fully
Diluted Shares as of the Effective Time. Except as described in the preceding
sentence, the number of shares of Powertel Common Stock and Powertel Common
Stock Equivalents for the purpose of such recalculation shall be determined in
the same manner as described in Item 1.06(c) of the Powertel Letter, including
shares of Powertel Common Stock issuable (i) in exchange for Powertel Preferred
Stock, (ii) pursuant to Powertel Stock Options and Powertel Warrants, (iii)
pursuant to Powertel Restricted Stock Awards, (iv) in connection with the Eliska
Put Rights, (v) pursuant to the Sonera Stock Purchase Agreement (as defined
below) and (vi) any other Powertel Common Stock and Powertel Common Stock
Equivalents outstanding as of the Effective Time. For purposes of this Section
1.06(e), the "Maximum Share Amount" means 55,784,000 shares; provided, however,
that if prior to the Effective Time the Stock Purchase Agreement between
Powertel and Sonera B.V. relating to the DiGiPH Transaction (the "Sonera Stock
Purchase Agreement") or the Eliska Put or the Sonera Put shall have been
terminated, the Maximum Share Amount shall be appropriately reduced.
SECTION 1.07 Surrender of Certificates.
(a) Exchange Agent. ChaseMellon Shareholder Services LLC shall act as
exchange agent in the Merger (the "Exchange Agent"). As and when needed, but no
later than twenty-five (25) Business Days after the Effective Time, VoiceStream
shall deposit with the Exchange Agent, in trust for the holders of certificates
(the "Powertel Certificates") which immediately prior to the Effective Time
represented shares of Powertel Stock converted in the Merger, certificates (the
"VoiceStream Certificates") representing the shares of VoiceStream Common Stock
issuable pursuant to Section 1.06(c) (such shares of VoiceStream Common Stock,
together with cash in lieu of fractional shares and any dividends, securities,
property or distributions with respect thereto payable in accordance with
Section 1.07(d) being hereinafter referred to as the "Exchange Fund").
(b) Exchange Procedure. As soon as reasonably practicable after the
Effective Time, but no later than five (5) Business Days after the Effective
Time, the Surviving Corporation shall cause the Exchange Agent to mail to each
holder of record of a Powertel Certificate, (i) a letter of transmittal (which
shall specify that delivery shall be effected, and risk of loss and title to a
Powertel Certificate shall pass, only upon delivery of such Powertel Certificate
to the Exchange Agent and shall be in a form and have such other provisions as
VoiceStream may reasonably specify), and (ii) instructions for use in effecting
the surrender of Powertel
-4-
9
Certificates in exchange for the property described in the next sentence. Upon
surrender for cancellation to the Exchange Agent of any Powertel Certificate(s)
held by any holder of record of a Powertel Certificate, together with such
letter of transmittal duly executed, such holder shall be entitled to receive in
exchange therefor a VoiceStream Certificate (which shall not include any
restrictive legends but may be subject to the agreement signed by Rule 145
Affiliates pursuant to Section 5.08(a) of this Agreement) representing the
number of whole shares of VoiceStream Common Stock into which the shares of
Powertel Stock represented by the surrendered Powertel Certificate(s) shall have
been converted at the Effective Time pursuant to Section 1.06(c), cash in lieu
of any fractional share of VoiceStream Common Stock in accordance with Section
1.07(e) and the dividends and other distributions in accordance with Section
1.07(d); and the Powertel Certificate(s) so surrendered shall forthwith be
cancelled. In the event of a transfer of ownership of shares of Powertel Stock
that is not registered in the transfer records of Powertel, cash or a
VoiceStream Certificate representing shares of VoiceStream Common Stock may be
paid to or issued in a name other than that in which the Powertel Certificate
surrendered in exchange therefor is registered, if such Powertel Certificate
shall be properly endorsed or otherwise be in proper form for transfer and the
person requesting such payment shall pay any transfer or other Taxes required by
reason of the payment to a person other than the registered holder of such
Powertel Certificate or establish to the satisfaction of the Surviving
Corporation that such Tax has been paid or is not applicable. Until surrendered
as contemplated by this Section 1.07, each Powertel Certificate shall be deemed
at any time after the Effective Time to represent only (A) the right to receive
VoiceStream Certificates representing the shares of VoiceStream Common Stock
into which the shares of Powertel Stock represented by such Powertel Certificate
have been converted, (B) any dividends and other distributions in accordance
with Section 1.07(d), and (C) any cash, without interest, to be paid in lieu of
any fractional share of VoiceStream Common Stock in accordance with Section
1.07(e). VoiceStream or the Exchange Agent shall be entitled to deduct and
withhold from the consideration otherwise payable pursuant to this Agreement to
any holder of shares of Powertel Stock such amounts as VoiceStream or the
Exchange Agent is required to deduct and withhold with respect to the making of
such payment under the Code or under any provision of state, local or foreign
Tax law, but in connection therewith shall be obligated to pay over to the
proper Tax authorities and properly report such payment as required by such Tax
law. To the extent that amounts are so withheld by VoiceStream or the Exchange
Agent (but not both) and have been properly paid to the appropriate Tax
authorities and reported as required by law, such withheld amounts shall be
treated for all purposes of this Agreement as having been paid to the holder of
the shares of Powertel Stock in respect of which such deduction and withholding
was made by VoiceStream or the Exchange Agent.
(c) No Further Ownership Rights in Shares. All shares of VoiceStream Common
Stock issued and cash paid upon the surrender of Powertel Certificates in
accordance with the terms of this Article I (including any cash paid pursuant to
Section 1.07(d) or Section 1.07(e)) shall be deemed to have been issued (and
paid) in full satisfaction of all rights pertaining to the shares of Powertel
Stock theretofore represented by such Powertel Certificates. At the Effective
Time, the stock transfer books of Powertel shall be closed, and there shall be
no further registration of transfers on the stock transfer books of the
Surviving Corporation of the shares of Powertel Stock that were outstanding
immediately prior to the Effective Time. If, after the Effective Time, Powertel
Certificates are presented to the Surviving Corporation or the Exchange Agent
for any reason, they shall be cancelled and exchanged as provided in this
Article I.
(d) Dividends. No dividends or other distributions that are declared on or
after the Effective Time on VoiceStream Common Stock, or are payable to the
holders of record thereof on or after the Effective Time, shall be paid to any
person entitled by reason of the Merger to receive VoiceStream Certificates, and
no cash payment in lieu of any fractional share of VoiceStream Common Stock
shall be paid to any such person pursuant to Section 1.07(e), until such person
shall have surrendered its Powertel Certificate(s) as provided in Section
1.07(b). Subject to applicable law, there shall be paid to each person receiving
a VoiceStream Certificate: (i) at the time of such surrender or as promptly as
practicable thereafter, the amount of any dividends or other distributions
theretofore paid with respect to the shares of VoiceStream Common Stock
represented by such VoiceStream Certificate and having a record date on or after
the Effective Time and a payment date prior to such surrender; and (ii) at the
appropriate payment date or as promptly as practicable thereafter, the amount of
any dividends or other distributions payable with respect to such shares of
VoiceStream Common Stock and having a record date on or after the Effective Time
but prior to such
-5-
10
surrender and a payment date on or subsequent to such surrender. In no event
shall the person entitled to receive such dividends or other distributions be
entitled to receive interest on such dividends or other distributions.
(e) No Fractional Shares. No certificates or scrip representing fractional
shares of VoiceStream Common Stock shall be issued upon the surrender for
exchange of Powertel Certificates pursuant to this Article I; and no such
fractional share shall entitle the record or beneficial owner thereof to vote or
to any other rights of a stockholder of VoiceStream. In lieu of any such
fractional share, each holder of shares of Powertel Stock who would otherwise
have been entitled thereto upon the surrender of Powertel Certificate(s) for
exchange pursuant to this Article I will be paid an amount in cash (without
interest), rounded to the nearest whole cent, determined by multiplying (i) the
per share closing price on the Nasdaq of VoiceStream Common Stock (as reported
on the Nasdaq) on the date on which the Effective Time shall occur (or, if
VoiceStream Common Stock shall not trade on the Nasdaq on such date, the first
day of trading in VoiceStream Common Stock on the Nasdaq thereafter) by (ii) the
fractional share to which such holder would otherwise be entitled.
(f) Termination of Exchange Fund. Any portion of the Exchange Fund which
remains undistributed to holders of Powertel Stock for twelve (12) months after
the Effective Time shall be delivered to VoiceStream, upon demand, and any
holders of Powertel Stock who have not theretofore complied with this Article I
and the instructions set forth in the letter of transmittal mailed to such
holders after the Effective Time shall thereafter look only to the Surviving
Corporation (subject to abandoned property, escheat or other similar laws) only
as general creditors thereof for payment of shares of VoiceStream Common Stock,
any cash in lieu of fractional shares of VoiceStream Common Stock and any
dividends or distributions with respect to such shares of VoiceStream Common
Stock to which they are entitled.
(g) No Liability. None of VoiceStream, Sub, Powertel, the Surviving
Corporation or the Exchange Agent shall be liable to any Person in respect of
any VoiceStream Common Stock or cash delivered to a public official pursuant to
any applicable abandoned property, escheat or similar law.
(h) Lost Certificates. If any Powertel Certificate is lost, stolen or
destroyed, upon the making of an affidavit of that fact by the Person claiming
such Powertel Certificate to be lost, stolen or destroyed and executing an
indemnity reasonably satisfactory to VoiceStream (and, if required by
VoiceStream, the posting by such Person of a bond, in such reasonable amount as
VoiceStream may direct, as indemnity) indemnifying VoiceStream against any claim
that may be made against VoiceStream with respect to the Powertel Certificate,
the Exchange Agent will issue, in exchange for such lost, stolen or destroyed
Powertel Certificate, the consideration to be paid in respect of the shares
represented by such Powertel Certificate. Such Person additionally will be
entitled to receive any amounts payable pursuant to Section 1.07(d) and/or
Section 1.07(e).
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF POWERTEL
Except as disclosed in the Powertel Filed SEC Documents and except as set
forth in the Powertel Letter (it being agreed that disclosure of any item in the
Powertel Letter shall be deemed disclosure with respect to any section of this
Agreement to which the relevance of such item is reasonably apparent), Powertel
hereby represents and warrants as of the date hereof to VoiceStream as follows:
SECTION 2.01 Organization. Each of Powertel and its Subsidiaries
(collectively, the "Powertel Subsidiaries") is a corporation or limited
liability company duly organized, validly existing and is in good standing
(where such concept is applicable) under the laws of the jurisdiction of its
incorporation or organization and has the requisite power and authority to carry
on its business as now being conducted, except where the failure to be so
organized, existing and in good standing or to have such power and authority
could not reasonably be expected to have a Material Adverse Effect on Powertel
or prevent or materially delay the consummation of the Reorganization. Powertel
and each of the Powertel Subsidiaries is duly qualified or licensed to do
business and is in good standing (where such concept is applicable) in each
jurisdiction in which the nature of its business or the ownership or leasing of
its properties makes such qualification or
-6-
11
licensing necessary, except in such jurisdictions where the failure to be so
duly qualified or licensed and in good standing could not reasonably be expected
to have a Material Adverse Effect on Powertel or prevent or materially delay the
consummation of the Reorganization. Powertel has delivered to VoiceStream
complete and correct copies of the Restated Certificate of Incorporation of
Powertel and Restated By-laws of Powertel and has made available to VoiceStream
the certificate of incorporation and by-laws (or similar organizational
documents) of each of the Powertel Subsidiaries.
SECTION 2.02 Subsidiaries. Item 2.02 of the Powertel Letter lists each
Powertel Subsidiary and any Investment Entity. All of the outstanding shares of
capital stock of each Powertel Subsidiary that is a corporation have been
validly issued and are fully paid and nonassessable. All of the outstanding
shares of capital stock of each Powertel Subsidiary are owned by Powertel or by
another Powertel Subsidiary free and clear of all Liens, except for Liens which
are granted to secure indebtedness and are disclosed in Item 2.02 of the
Powertel Letter. Except as set forth in Item 2.02 of the Powertel Letter, (i)
Powertel and the Powertel Subsidiaries have no material ongoing obligations,
agreements, commitments, rights, understandings or arrangements with respect to
any Investment Entities, including funding obligations; and (ii) all Investment
Interests are owned by Powertel or the Powertel Subsidiaries free and clear of
all Liens. Except as set forth in Item 2.02 of the Powertel Letter and except
for the capital stock owned by Powertel, directly or indirectly, in the Powertel
Subsidiaries, neither Powertel nor any of the Powertel Subsidiaries owns,
directly or indirectly, any capital stock or other ownership interest in any
corporation, partnership, joint venture, limited liability company or other
entity.
SECTION 2.03 Capital Structure. The authorized capital stock of Powertel
consists of 401,000,000 shares of capital stock, of which 400,000,000 shares are
authorized to be issued as Powertel Common Stock, and 1,000,000 shares are
authorized to be issued as Powertel Preferred Stock. As of the close of business
on August 18, 2000, Powertel had 31,381,461 shares of Powertel Common Stock
issued and outstanding. The series of Powertel Preferred Stock and the number of
designated, issued and outstanding shares, the current exchange ratio and the
number of shares of Powertel Common Stock issuable upon conversion as of the
close of business on August 18, 2000, were as follows:
SHARES OF
DESIGNATED, POWERTEL
ISSUED AND CURRENT COMMON STOCK
OUTSTANDING EXCHANGE ISSUABLE UPON
SERIES SHARES RATIO(1) CONVERSION
------ ------------ -------- -------------
Series Convertible Preferred Stock A.................... 100,000 46.26774 4,626,774
("Series A Preferred Shares")
Series B Convertible Preferred Stock.................... 100,000 46.26774 4,626,774
("Series B Preferred Shares")
Series C Convertible Preferred Stock.................... --(2) -- --
("Series C Preferred Shares")
Series D Convertible Preferred Stock.................... 50,000 35.29412 1,764,706
("Series D Preferred Shares")
Series E 6.5% Cumulative Convertible Preferred Stock.... 50,000 68.15084 3,407,542
("Series E Preferred Shares")(3)
Series F 6.5% Cumulative Convertible Preferred Shares... 50,000 68.15084 3,407,542
("Series F Preferred Shares")(3)
---------------
(1) Subject to any applicable adjustments set forth in the Certificates of
Designation relating to Powertel Preferred Stock.
(2) 50,000 shares initially designated as Series C Preferred Shares have been
converted to Powertel Common Stock.
(3) The Series E Preferred Shares and Series F Preferred Shares bear cumulative
dividends that accrue on a daily basis at an annual rate of 6.5% of the
initial purchase price of such shares.
-7-
12
The Series A, B, C, D, E and F Preferred Shares are hereinafter
collectively referred to as the "Powertel Preferred Stock." As of the close of
business on August 18, 2000: (i) 56,438 shares of Powertel Common Stock were
held by Powertel in treasury; (ii) an aggregate of 17,833,338 shares of Powertel
Common Stock were reserved for issuance upon conversion of Powertel Preferred
Stock; (iii) an aggregate of 2,152,602 shares of Powertel Common Stock were
reserved for issuance upon exercise of outstanding stock options (the "Powertel
Stock Options") granted under the Amended and Restated 1991 Employee Stock
Option Plan (the "1991 Plan"), the Amended Nonemployee Stock Option Plan (the
"Nonemployee Option Plan") and the 2000 Stock Option and Incentive Plan (the
"2000 Plan" and with the 1991 Plan and the Nonemployee Option Plan, the
"Powertel Stock Option Plans"); (iv) 75,272 shares of Powertel Common Stock were
reserved for issuance pursuant to outstanding Powertel Restricted Stock Awards
granted under the 1995 Employee Restricted Stock Plan (the "Restricted Stock
Plan"); (v) 3,446,340 shares of Powertel Common Stock remained available for
issuance pursuant to future stock option grants and restricted stock awards
under the 2000 Plan; (vi) 966,688 shares of Powertel Common Stock were reserved
for issuance pursuant to outstanding Powertel Warrants, which have an exercise
price of $16.9546 per share, subject to adjustment; and (vii) an aggregate of
30,142 shares of Powertel Common Stock are reserved for accrued but unpaid
dividends on the Series E Preferred Shares and Series F Preferred Shares. Item
2.03 of the Powertel Letter has a complete and accurate schedule of all Powertel
Stock Options and their respective shares, vesting schedules, exercise prices
and expiration dates that are outstanding on the date hereof (provided that with
respect to Powertel employees below the director level, such list need only set
forth the aggregate number of options with the weighted average exercise prices
at which grants have been made and need not specify grants by grantee). Except
as set forth above and in Items 2.02 and 2.03 of the Powertel Letter, as of the
date hereof, no shares of Powertel Stock or shares of capital stock of any
Powertel Subsidiary were issued, reserved for issuance or outstanding, and there
are no stock appreciation rights, phantom stock rights or other contractual
rights the value of which is determined in whole or in part by the value of any
capital stock ("Powertel Stock Rights") of Powertel or any Powertel Subsidiary.
The Powertel Preferred Stock, the Powertel Stock Options, the Powertel Warrants,
the Eliska Put Rights, the Powertel Stock Rights and any other security
convertible into or exercisable or exchangeable for Powertel Common Stock (each
of which shall be determined on an as if converted, exercised or exchanged
basis) are herein referred to as "Powertel Common Stock Equivalents." Each
outstanding share of Powertel Stock is, and each share of Powertel Stock which
may be issued pursuant to the Powertel Benefit Plans and the other agreements
and instruments listed above will be, when issued, duly authorized, validly
issued, fully paid and nonassessable and not subject to preemptive rights. There
are no outstanding bonds, debentures, notes or other indebtedness of Powertel or
any Powertel Subsidiary having the right to vote (or convertible into, or
exchangeable for, securities having the right to vote) on any matter on which
Powertel's stockholders may vote. Except as set forth above or in Item 2.03 of
the Powertel Letter, as of the date of this Agreement, there are no securities,
options, warrants, calls, rights, commitments, agreements, arrangements or
undertakings of any kind obligating Powertel or any of the Powertel Subsidiaries
to issue, deliver or sell or create, or cause to be issued, delivered or sold or
created, additional shares of capital stock or other voting securities or
Powertel Common Stock Equivalents or stock equivalents of any of the Powertel
Subsidiaries or obligating Powertel or any of the Powertel Subsidiaries to
issue, grant, extend or enter into any such security, option, warrant, call,
right, commitment, agreement, arrangement or undertaking.
Except as set forth in Item 2.03 of the Powertel Letter, as of the date of
this Agreement, there are no outstanding contractual obligations of Powertel or
any of the Powertel Subsidiaries to repurchase, redeem or otherwise acquire any
shares of capital stock of Powertel or any of the Powertel Subsidiaries.
Between August 18, 2000, and the date of this Agreement, no Powertel Common
Stock or Powertel Common Stock Equivalents have been issued or granted, except
issuances of Powertel Common Stock upon the exercise of Powertel Stock Options
or Powertel Warrants outstanding on August 18, 2000, and grants of new Powertel
Stock Options to new employees or employees granted promotions in the ordinary
course of business; provided that the shares of Powertel Common Stock underlying
such Powertel Stock Options will not exceed a total of 50,000 shares of Powertel
Common Stock.
SECTION 2.04 Authority. The Board of Directors of Powertel, at a meeting
duly called and held, duly adopted resolutions (i) approving this Agreement, the
Reorganization and the Powertel Stockholder
-8-
13
Agreement, (ii) determining that the Reorganization, including the Merger, is
fair to and in the best interests of Powertel's stockholders and (iii)
recommending that Powertel's stockholders approve and adopt this Agreement.
Powertel has the requisite corporate power and authority to execute and deliver
this Agreement and the other agreements to which it is a party that are
referenced herein and, subject to the adoption and approval of this Agreement by
(i) a majority of the votes entitled to be cast by the holders of all
outstanding shares of Powertel Common Stock and Series A Preferred Shares,
voting on an as-if-converted to Powertel Common Stock basis and voting together
with the holders of the Powertel Common Stock as a single class, and (ii)
two-thirds of each class of the Series A Preferred Shares, Series B Preferred
Shares, Series D Preferred Shares, Series E Preferred Shares and Series F
Preferred Shares, each such class of preferred stock voting as a single class
(collectively, the "Powertel Stockholder Approval"), to consummate the
transactions contemplated hereby. The execution, delivery and performance of
this Agreement by Powertel and the consummation by Powertel of the
Reorganization and of the other transactions contemplated hereby have been duly
authorized by all necessary corporate action on the part of Powertel, subject to
the Powertel Stockholder Approval. This Agreement has been duly executed and
delivered by Powertel and (assuming the valid authorization, execution and
delivery of this Agreement by VoiceStream) constitutes the valid and binding
obligation of Powertel enforceable against Powertel in accordance with its
terms, except that such enforceability (i) may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting or
relating to the enforcement of creditors' rights and remedies generally, and
(ii) is subject to general principles of equity (regardless of whether
considered in a proceeding in equity or at law).
SECTION 2.05 Consents and Approvals; No Violations. Except as set forth
in Item 2.05 of the Powertel Letter, and except for filings, permits,
authorizations, consents and approvals as may be required under, and other
applicable requirements of, the Securities Act, state securities or "Blue Sky"
laws, the Exchange Act, the Communications Act, the HSR Act, the DGCL, the
rules, regulations and published decisions of the FAA, the FCC and state public
utility or service commissions or similar agencies, or the rules and regulations
of Nasdaq (collectively, the "Powertel Required Approvals"), neither the
execution, delivery or performance of this Agreement by Powertel nor the
consummation by Powertel of the transactions contemplated hereby will (i)
violate or conflict with the Restated Certificate of Incorporation or Restated
By-laws of Powertel or of the similar organizational documents of any of the
Powertel Subsidiaries, (ii) require any filing with, or permit, authorization,
consent or approval of, any Governmental Entity (except where the failure to
obtain such permits, authorizations, consents or approvals or to make such
filings could not reasonably be expected to have a Material Adverse Effect on
Powertel or prevent or materially delay the consummation of the Reorganization),
(iii) result in a violation or breach of, or constitute (with or without due
notice or lapse of time or both) a default (or give rise to any right of
termination, amendment, cancellation or acceleration) under, any of the terms,
conditions or provisions of any note, bond, mortgage, indenture, lease, license,
contract, agreement or other instrument or obligation to which Powertel or any
of the Powertel Subsidiaries is a party or by which any of their respective
properties are bound, (iv) violate any law, court order, judgment, decree, or
regulation applicable to Powertel or any of the Powertel Subsidiaries or by
which any of their respective properties are bound, or (v) result in the
creation or imposition of any Lien on any asset of Powertel or the Powertel
Subsidiaries, except in the case of clauses (iii), (iv) or (v) for violations,
breaches or defaults that could not reasonably be expected to have a Material
Adverse Effect on Powertel or prevent or materially delay the consummation of
the Reorganization.
SECTION 2.06 SEC Documents and Other Reports. Powertel has filed with the
SEC all documents required to be filed by it since January 1, 1997 under the
Securities Act or the Exchange Act (the "Powertel SEC Documents"). As of their
respective filing dates, the Powertel SEC Documents were prepared substantially
in accordance with the requirements of the Securities Act or the Exchange Act,
as the case may be, each as in effect on the date so filed, and at the time
filed with the SEC (or if amended or superseded by a filing prior to the date
hereof, then on the date of such filing) none of the Powertel SEC Documents
contained any untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading. The
financial statements of Powertel included in the Powertel SEC Documents have
been prepared in accordance with generally accepted accounting principles
(except in the case of the unaudited statements permitted by Form 10-Q under the
Exchange Act) applied on a consistent basis during the periods
-9-
14
involved (except as may be indicated therein or in the notes thereto) and fairly
present the consolidated financial position of Powertel and the consolidated
Powertel Subsidiaries as of the respective dates thereof and the consolidated
results of operations and consolidated cash flows for the periods then ended
(subject, in the case of unaudited statements, to normal year-end audit
adjustments and to any other adjustments described therein).
SECTION 2.07 Absence of Material Adverse Change. Except as disclosed in
Item 2.07 of the Powertel Letter or in the documents filed by Powertel with the
SEC and publicly available prior to the date of this Agreement (the "Powertel
Filed SEC Documents"), since December 31, 1999, Powertel and the Powertel
Subsidiaries have conducted their respective businesses in all material respects
only in the ordinary course, consistent with past practices, and there has not
been (i) any Material Adverse Change with respect to Powertel, (ii) any
declaration, setting aside or payment of any dividend or other distribution with
respect to its capital stock (other than regularly scheduled dividends on the
Series E Preferred Shares and Series F Preferred Shares) or any redemption,
purchase or other acquisition of any of its capital stock, (iii) any split,
combination or reclassification of any of its capital stock or any issuance or
the authorization of any issuance of any other securities in respect of, in lieu
of or in substitution for shares of its capital stock, or (iv) any material
change in accounting methods, principles or practices by Powertel affecting its
assets, liabilities or business, except insofar as may have been required by a
change in generally accepted accounting principles.
SECTION 2.08 Information Supplied. None of the information supplied or to
be supplied by Powertel specifically for inclusion or incorporation by reference
in (i) the Registration Statement or (ii) the joint proxy statement (together
with any amendments or supplements thereto, the "Joint Proxy Statement")
relating to the Stockholder Meetings will, in the case of the Registration
Statement, at the time it becomes effective, contain any untrue statement of a
material fact or omit to state any material fact required to be stated therein
or necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading, or in the case of the
Joint Proxy Statement, at the time of the mailing of the Joint Proxy Statement
or the time of the Stockholder Meetings, contain any untrue statement of a
material fact or omit to state any material fact required to be stated therein
or necessary in order to make the statements therein, in light of the
circumstances under which they are made, not misleading. The Registration
Statement will comply (with respect to Powertel) as to form in all material
respects with the requirements of the Securities Act, and the Joint Proxy
Statement will comply (with respect to Powertel) as to form in all material
respects with the requirements of the Exchange Act. Powertel makes no
representation or warranty with respect to any information supplied by
VoiceStream or any other Person who is not an Affiliate of Powertel that is
contained in the Registration Statement or the Joint Proxy Statement.
SECTION 2.09 Permits; Compliance with Laws. (a) Each of Powertel and the
Powertel Subsidiaries is in possession of all franchises, grants,
authorizations, licenses, permits, charters, easements, variances, exceptions,
consents, certificates, approvals and orders of any Governmental Entity
necessary for Powertel or any of the Powertel Subsidiaries to own, lease and
operate its properties or to carry on its business as it is now being conducted
(the "Powertel Permits"), except where the failure to have any of the Powertel
Permits could not, individually or in the aggregate, have a Material Adverse
Effect on Powertel, and, as of the date of this Agreement, no suspension or
cancellation of any of the Powertel Permits is pending or, to the knowledge of
Powertel, threatened, except where the suspension or cancellation of any of the
Powertel Permits could not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect on Powertel. The business of Powertel
and the Powertel Subsidiaries is not being conducted in violation of any law,
ordinance or regulation of any Governmental Entity, except for possible
violations that could not reasonably be expected to have a Material Adverse
Effect on Powertel or prevent or materially delay the consummation of the
Reorganization. None of the representations and warranties made in this Section
2.09 are being made with respect to Environmental Laws.
(b) Except as set forth in Item 2.09 of the Powertel Letter:
(i) Powertel and each of the Powertel Subsidiaries holds, and is
qualified and eligible to hold, all material licenses, permits and other
authorizations issued or to be issued by the FCC to such entity for the
operation of their respective businesses, all of which are set forth in
Item 2.09 of the Powertel Letter
-10-
15
(the "Powertel FCC Licenses"). Each of the Powertel FCC Licenses that is
subject to restrictions under Section 310(b) of the Communications Act is
held by a Powertel Subsidiary.
(ii) The Powertel FCC Licenses are valid and in full force and effect,
and neither Powertel nor any of the Powertel Subsidiaries is or has been
delinquent in payment on or in default under any installment obligation
owed to the United States Treasury in connection with the Powertel FCC
Licenses. As used herein, the term "full force and effect" means that (A)
the orders issuing the Powertel FCC Licenses have become effective, (B) no
stay of effectiveness of such orders has been issued by the FCC, and (C)
the Powertel FCC Licenses have not been invalidated by any subsequent
published FCC action.
(iii) All material reports and applications required by the
Communications Act or required to be filed with the FCC by Powertel or any
of the Powertel Subsidiaries have been filed and are accurate and complete
in all material respects.
(iv) Powertel and the Powertel Subsidiaries are, and have been, in
compliance in all material respects with, and the wireless communications
systems operated pursuant to the Powertel FCC Licenses are and have been
operated in compliance in all material respects with, the Communications
Act.
(v) There is not pending or, to Powertel's knowledge, threatened, as
of the date hereof any application, petition, objection, pleading or
proceeding with the FCC or any public service commission or similar body
having jurisdiction or authority over the communications operations of
Powertel or any of the Powertel Subsidiaries which is reasonably likely to
result in the revocation, cancellation, suspension, dismissal, denial or
any materially adverse modification of any Powertel FCC License or
imposition of any substantial fine or forfeiture against Powertel or any of
the Powertel Subsidiaries.
(vi) No facts are known to Powertel or the Powertel Subsidiaries which
if known by a Governmental Entity of competent jurisdiction would present a
substantial risk that any Powertel FCC License could be revoked, cancelled,
suspended or materially adversely modified or that any substantial fine or
forfeiture could be imposed against Powertel or any of the Powertel
Subsidiaries.
(vii) Powertel and the Powertel Subsidiaries have not made any
material misstatements of fact, or omitted to disclose any fact, to any
Government Entity or in any report, document or certificate filed
therewith, which misstatements or omissions, individually or in the
aggregate, could reasonably be expected to subject any Powertel FCC
Licenses to revocation or failure to renew, except to the extent that such
revocation or failure to renew would not have a Material Adverse Effect on
Powertel or the transactions contemplated by this Agreement.
SECTION 2.10 Tax Matters. Except as set forth in Item 2.10 of the Powertel
Letter or as would not have a Material Adverse Effect on Powertel: (i) Powertel
and each of the Powertel Subsidiaries have timely filed (after taking into
account any extensions to file) all Tax Returns required to be filed by them
either on a separate or combined or consolidated basis; (ii) all such Tax
Returns are correct in all respects and accurately disclose in all respects all
Taxes required to be paid for the periods covered thereby; (iii) Powertel and
the Powertel Subsidiaries have paid or caused to be paid all Taxes shown as due
on such Tax Returns and all Taxes for which no Tax Return was required to be
filed, and the financial statements contained in the Powertel SEC Documents
reflect an adequate reserve as determined in accordance with generally accepted
accounting principles for all material Taxes payable by Powertel and the
Powertel Subsidiaries and not yet due (other than a reserve for deferred Taxes
established to reflect timing differences between book and Tax treatment) for
all taxable periods and portions thereof accrued through the date of such
financial statements; (iv) none of Powertel or any Powertel Subsidiary has
waived in writing any statute of limitations in respect of Taxes; (v) there is
no action, suit, investigation, audit, claim or assessment that has been
formally commenced or proposed to Powertel in writing with respect to Taxes of
Powertel or any of the Powertel Subsidiaries where an adverse determination is
reasonably likely; (vi) there are no Liens for Taxes upon the assets of Powertel
or any Powertel Subsidiary except for Liens relating to current Taxes not yet
due; (vii) all Taxes which Powertel or any Powertel Subsidiary is required by
law to withhold or to collect for payment have been duly withheld and collected,
and have been paid or accrued on the books of Powertel or such Powertel
Subsidiary; (viii) neither Powertel nor any Powertel Subsidiary has been a
member of any group of corporations filing Tax Returns on a
-11-
16
consolidated, combined, unitary or similar basis other than each such group of
which it is currently a member; (ix) no deduction of any amount that would
otherwise be deductible by Powertel or any of the Powertel Subsidiaries with
respect to taxable periods ending on or before the Effective Time could be
disallowed under Section 162(m) of the Code; (x) neither Powertel nor any of the
Powertel Subsidiaries has constituted either a "distributing corporation" or a
"controlled corporation" in a distribution of stock qualifying for tax-free
treatment under Section 355 of the Code (a) in the two (2) years prior to the
date of this Agreement or (b) in a distribution which could otherwise constitute
part of a "plan" or "series of related transactions" (within the meaning of
Section 355(e) of the Code) in conjunction with the Reorganization; (xi) neither
Powertel nor any of the Powertel Subsidiaries is a "United States real property
holding corporation" within the meaning of Section 897(c)(2) of the Code; (xii)
none of Powertel, VoiceStream or any of their Subsidiaries will be obligated to
make a payment, in connection with the transactions contemplated hereunder or
otherwise, to any employee or former employee of, or individual providing
services to, Powertel or any Powertel Subsidiary that would be a "parachute
payment" to a "disqualified individual" as those terms are defined in Section
280G of the Code without regard to whether such payment is reasonable
compensation for personal services performed or to be performed in the future;
and (xiii) none of Powertel, VoiceStream or any of their Subsidiaries will be
obligated to pay any excise taxes or similar taxes imposed on any employee or
former employee of, or individual providing services to, Powertel or any
Powertel Subsidiary under Section 4999 of the Code or any similar provisions as
a result of the consummation of the transactions contemplated hereby, either
alone or in connection with any other event.
SECTION 2.11 Liabilities. Except as set forth in the Powertel Filed SEC
Documents or Item 2.11 of the Powertel Letter, and as permitted by this
Agreement and the Powertel Merger Agreement, Powertel and the Powertel
Subsidiaries, taken as a whole, do not have any liabilities or obligations of
any nature (whether accrued, absolute, contingent or otherwise) required by
generally accepted accounting principles to be set forth on a consolidated
balance sheet of Powertel and the Powertel Subsidiaries or in the notes thereto,
other than (i) liabilities and obligations incurred in the ordinary course of
business since December 31, 1999 or (ii) liabilities arising after December 31,
1999 which could not, individually or in the aggregate, reasonably be expected
to have a Material Adverse Effect on Powertel.
SECTION 2.12 Benefit Plans; Employees and Employment Practices.
(a) Except as disclosed in the Powertel Filed SEC Documents or Item 2.12(a)
of the Powertel Letter, or to the extent required by law or required to maintain
compliance with provisions of the Code, neither Powertel nor any of the Powertel
Subsidiaries has adopted or amended in any material respect any ERISA Benefit
Plan of Powertel since the date of the most recent audited financial statements
included in the Powertel Filed SEC Documents. Except as set forth in Item
2.12(a) of the Powertel Letter, Powertel does not have any commitment to create,
adopt or contribute to any Powertel Benefit Plan. Except as disclosed in Item
2.12(a) of the Powertel Letter or in the Powertel Filed SEC Documents, as of the
date of this Agreement, there exist no material employment, consulting,
severance, bonus, incentive or termination agreements between Powertel or any of
the Powertel Subsidiaries and any current or former employee, officer or
director of Powertel or any of the Powertel Subsidiaries.
(b) Item 2.12(b) of the Powertel Letter contains a list of all the Powertel
Benefit Plans. None of Powertel, any of the Powertel Subsidiaries, any officer
of Powertel or any of the Powertel Subsidiaries or any of the ERISA Benefit
Plans has on or before the date of this Agreement engaged in a "prohibited
transaction" (as defined in Section 406 of ERISA or Section 4975 of the Code)
with respect to any ERISA Benefit Plan that could reasonably be expected to
subject Powertel, any of the Powertel Subsidiaries or any officer of Powertel or
any of the Powertel Subsidiaries to any Tax on prohibited transactions imposed
by Section 4975 of the Code or to any liability under Section 502(i) or (l) of
ERISA where such Tax or liability has or would be reasonably expected to have a
Material Adverse Effect on Powertel. No ERISA Benefit Plan has incurred any
"accumulated funding deficiency" (as defined in Section 412 of the Code or Part
3 of Title I of ERISA), whether or not waived. Neither Powertel nor any of the
Powertel Subsidiaries has incurred and none of such entities reasonably expects
to incur, any material liability to the PBGC with respect to any ERISA Benefit
Plan. No assets of Powertel or any of the Powertel Subsidiaries are subject to
Liens arising under ERISA or the Code on account of any ERISA Benefit Plan,
neither Powertel nor any of the Powertel Subsidiaries has
-12-
17
been required to provide any security under Sections 401(a)(29) or 412(f) of the
Code, or under Section 307 of ERISA, and, to Powertel's knowledge, no event has
occurred that could give rise to any such Lien or a requirement to provide any
such security. Except as disclosed in Item 2.12(b) of the Powertel Letter, none
of Powertel, the Powertel Subsidiaries or any ERISA Affiliate has at any time
during the five-year period preceding the date hereof contributed to any
"multiemployer plan" (as defined in Section 3(37) of ERISA).
(c) Except as disclosed in Item 2.12(c) of the Powertel Letter, and except
for such matters as could not be reasonably expected to have a Material Adverse
Effect on Powertel, to the extent applicable, (i) each ERISA Benefit Plan
complies with the requirements of ERISA and the Code, (ii) each ERISA Benefit
Plan intended to be qualified under Section 401(a) of the Code has been
determined by the Internal Revenue Service to be so qualified and nothing has
occurred since the date of that determination that could reasonably be expected
to adversely affect the qualified status of such plan and its related trust is
tax-exempt and has been so since its creation, and (iii) each Powertel Benefit
Plan has been maintained, administered and operated in compliance with its terms
and with the requirements prescribed by any and all statutes, orders, rules and
regulations, including but not limited to ERISA and the Code, which are
applicable to such Powertel Benefit Plans.
(d) Except as disclosed in Item 2.12(d) of the Powertel Letter, all
material contributions, reserves or premium payments under or to the Powertel
Benefit Plans, accrued to the date hereof have been made or provided for.
(e) Except as disclosed in Item 2.12(e) of the Powertel Letter, and except
for any liability as could not be reasonably expected to have a Material Adverse
Effect on Powertel, Powertel has not incurred any liability under Subtitle C or
D of Title IV of ERISA with respect to any "single-employer plan" within the
meaning of Section 4001(a)(15) of ERISA, currently or formerly maintained by
Powertel, or any entity which is considered one employer with Powertel under
Section 4001 of ERISA.
(f) Except as disclosed in Item 2.12(f) of the Powertel Letter, neither
Powertel nor any of the Powertel Subsidiaries has any obligation to provide
retiree health or welfare benefits for any current or former employee under any
Powertel Benefit Plan, except as required by Part 6 of Title I of ERISA or to
avoid excise taxes under Section 4980B of the Code, and the terms of the
Powertel Benefit Plans permit Powertel to amend or terminate such Powertel
Benefit Plans at any time without incurring liability thereunder.
(g) Except as disclosed in Item 2.12(g) of the Powertel Letter, Powertel
has not engaged in, nor is it a successor or parent corporation to an entity
that has engaged in a transaction described in Section 4069 of ERISA.
(h) Except as disclosed in Item 2.12(h) of the Powertel Letter, the
consummation or announcement of any transaction contemplated by this Agreement
will not (either alone or upon the occurrence of any additional or further acts
or events) result in any (i) payment (whether of severance pay or otherwise)
becoming due from Powertel or any of the Powertel Subsidiaries to any officer,
employee, former employee or director thereof or to the trustee under any "rabbi
trust" or similar arrangement; (ii) benefit under any Powertel Benefit Plan
being established or becoming accelerated, vested or payable; or (iii)
"reportable event" (as defined in Section 4043 of ERISA) with respect to any
ERISA Benefit Plan subject to Title IV of ERISA.
(i) Except as disclosed in Item 2.12(i) of the Powertel Letter, as of the
date of this Agreement there are no pending disputes, arbitrations, claims,
suits, grievances or, to the knowledge of Powertel, governmental audits
involving a Powertel Benefit Plan (other than routine claims for benefits
payable under any such Powertel Benefit Plan or routine audits) that would
reasonably be expected either individually or in the aggregate, to have a
Material Adverse Effect on Powertel.
(j) Item 2.12(j) of the Powertel Letter contains a list setting forth the
name and current annual salary and other material compensation payable to each
Significant Employee, and the profit sharing, bonus or other form of additional
cash compensation paid or payable by Powertel or the Powertel Subsidiaries to or
for the benefit of each such person for the current fiscal year. Except as set
forth in Item 2.12(j) of the Powertel Letter, there are no oral or written
contracts, agreements or arrangements obligating Powertel or any of the
-13-
18
Powertel Subsidiaries to increase the compensation or benefits presently being
paid or hereafter payable to any Significant Employees or any oral employment or
consulting or similar arrangements regarding any Significant Employee that are
not terminable without liability on thirty (30) days' or less prior notice. Item
2.12(j) of the Powertel Letter lists all written employment and consulting
agreements with respect to any Significant Employee. Powertel has provided true
and correct copies of all employment agreements listed on Item 2.12(j) of the
Powertel Letter. Except for severance or retention obligations to Significant
Employees set forth in Item 2.12(j) or as otherwise set forth in Item 2.12(j),
there is not due or owing and there will not be due and owing at the Effective
Time to any Significant Employees, any sick pay, severance pay (whether arising
out of the termination of a Significant Employee prior to, on, or subsequent to
the Effective Time), compensable time or pay, including salary, commission and
bonuses, personal time or pay or vacation time or vacation pay attributable to
service rendered on or prior to the Effective Time, the aggregate of which
exceeds $50,000 for any Significant Employee. Except as disclosed in Item
2.12(j) of the Powertel Letter and other than claims made in the ordinary course
of business consistent with past practice in an aggregate amount not to exceed
$500,000 neither Powertel nor any of the Powertel Subsidiaries have any
liability arising out of claims made or suits brought (including workers'
compensation claims and claims or suits for contribution to, or indemnification
of, third parties, occupational health and safety, environmental, consumer
protection or equal employment matters) for injury, sickness, disease,
discrimination, death or termination of employment of any Significant Employee,
or other employment matter to the extent attributable to an event occurring or a
state of facts existing on or prior to the Effective Time.
(k) Except as set forth in Item 2.12(k) of the Powertel Letter, Powertel
and each of the Powertel Subsidiaries (i) is in compliance with all applicable
federal and state laws, rules and regulations respecting employment, employment
practices, terms and conditions of employment and wages and hours, in each case,
with respect to Powertel Employees, except where the failure to be in compliance
would not, singly or in the aggregate, have a Material Adverse Effect on
Powertel or its financial condition or business; (ii) has withheld all amounts
required by law or by agreement to be withheld from the wages, salaries and
other payments to Powertel Employees; (iii) is not liable for any arrears of
wages or any taxes or any penalty for failure to comply with any of the
foregoing, except as would reasonably be expected to not have a Material Adverse
Effect on Powertel; and (iv) (other than routine payments to be made in the
normal course of business and consistent with past practice) is not liable for
any payment to any trust or other fund or to any governmental or administrative
authority, with respect to unemployment compensation benefits, Social Security
or other benefits for Powertel Employees.
(l) Except as disclosed in Item 2.12(l) of the Powertel Letter, as of the
date of this Agreement there are no controversies, strikes, work stoppages or
disputes pending or to Powertel's knowledge threatened against Powertel or any
of the Powertel Subsidiaries, and no organizational effort by any labor union or
other collective bargaining unit currently is under way with respect to any
employee, which in any such case would reasonably be expected to have a Material
Adverse Effect on Powertel. None of Powertel or any of the Powertel Subsidiaries
is a party to a collective bargaining agreement. Except as set forth in Item
2.12(l) of the Powertel Letter, there is no, and there is not threatened, any
labor dispute, grievance or litigation relating to labor, safety or
discrimination matters involving any Powertel Employee including charges of
unfair labor practices or discrimination complaints, which, if adversely
determined, would reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect on Powertel. There has been no engagement
in any unfair labor practices by Powertel or the Powertel Subsidiaries within
the meaning of the National Labor Relations Act which would reasonably be
expected to have, individually or in the aggregate, a Material Adverse Effect on
Powertel.
SECTION 2.13 Litigation. Except as disclosed in Item 2.13 of the Powertel
Letter or in the Powertel Filed SEC Documents, as of the date of this Agreement,
there is no suit, action, proceeding or investigation pending or, to Powertel's
knowledge, threatened, against Powertel or any of the Powertel Subsidiaries
before any Governmental Entity that, individually or in the aggregate, would
reasonably be expected to have a Material Adverse Effect on Powertel or prevent
or materially delay the consummation of the Reorganization. Except as disclosed
in Item 2.13 of the Powertel Letter or in the Powertel Filed SEC Documents,
neither Powertel nor any of the Powertel Subsidiaries is subject to any
outstanding judgment, order, writ, injunction or
-14-
19
decree that could, individually or in the aggregate, reasonably be expected to
have a Material Adverse Effect on Powertel.
SECTION 2.14 Environmental Matters. Except for such matters that,
individually or in the aggregate, could not reasonably be expected to have a
Material Adverse Effect on Powertel, or would not otherwise require disclosure
pursuant to the Securities Act or Exchange Act, (i) each of Powertel and the
Powertel Subsidiaries has complied and is in compliance with all applicable
Environmental Laws; (ii) the properties currently owned or operated by Powertel
or any of the Powertel Subsidiaries (including soils, groundwater, surface
water, buildings or other structures) are not contaminated with any Hazardous
Substances; (iii) to Powertel's knowledge, no Hazardous Substances were present,
disposed, released or otherwise deposited on, under, at or from the properties
formerly owned or operated by Powertel or any of the Powertel Subsidiaries
during the period of ownership or operation by Powertel or any of the Powertel
Subsidiaries; (iv) to Powertel's knowledge, neither Powertel nor any of the
Powertel Subsidiaries is subject to liability for any Hazardous Substance
disposal or contamination on any third party property; (v) neither Powertel nor
any of the Powertel Subsidiaries has received any notice, demand, threat,
letter, claim or request for information alleging that Powertel or any of the
Powertel Subsidiaries may be in violation of or liable under any Environmental
Law (including any claims relating to electromagnetic fields or microwave
transmissions); and (vi) to Powertel's knowledge, neither Powertel nor any of
the Powertel Subsidiaries is subject to any orders, decrees, injunctions or
other arrangements (other than those of general applicability not specifically
related to Powertel) with any Governmental Entity or regulatory authority or is
subject to any indemnity or other agreement with any third party relating to
liability under any Environmental Law or relating to Hazardous Substances
(except for such agreements entered into by Powertel in the ordinary course of
business).
SECTION 2.15 Section 203 of DGCL. The Board of Directors of Powertel has
approved this Agreement, the Reorganization and the Powertel Stockholder
Agreement and the transactions contemplated hereby, with the effect that the
restrictions on business combinations contained in Section 203 of the DGCL will
not apply to VoiceStream or Sub as a result of this Agreement, the
Reorganization and Powertel Stockholder Agreement. To Powertel's knowledge, (i)
no anti-takeover statute or similar law of Georgia or Delaware imposes
restrictions which could reasonably be expected to adversely affect or delay the
consummation of the transactions contemplated by this Agreement, and (ii) no
"control share acquisition," "fair price," "moratorium" or other anti-takeover
laws or regulations enacted under Georgia or Delaware law applicable to Powertel
apply to this Agreement or any of the transactions related thereto.
SECTION 2.16 Intellectual Property. Except as set forth in the Powertel
Filed SEC Documents or in Item 2.16 of the Powertel Letter, the Intellectual
Property Rights consist solely of items and rights which are: (i) owned by
Powertel or the Powertel Subsidiaries; (ii) in the public domain; or (iii)
rightfully used by Powertel or the Powertel Subsidiaries pursuant to a license,
and, with respect to Intellectual Property Rights owned by Powertel or the
Powertel Subsidiaries, Powertel or the Powertel Subsidiaries own the entire
right, title and interest in and to such Intellectual Property Rights free and
clear of any Liens. Powertel and the Powertel Subsidiaries have all rights in
the Intellectual Property Rights necessary to carry out their businesses
substantially as currently conducted except as could not reasonably be expected
to have a Material Adverse Effect on Powertel. The Intellectual Property Rights
do not infringe on any proprietary right of any Person, except to the extent
that any such infringement, individually or in the aggregate, could not
reasonably be expected to have a Material Adverse Effect on Powertel. As of the
date of this Agreement, no claims against Powertel or any Powertel Subsidiary
(or, to Powertel's knowledge, against any other holder of Intellectual Property
Rights) (x) challenging the validity, effectiveness, or ownership by Powertel or
the Powertel Subsidiaries of any of the Intellectual Property Rights, or (y) to
the effect that the Intellectual Property Rights infringe or will infringe on
any intellectual property or other proprietary right of any Person have been
asserted or, to Powertel's knowledge, are threatened by any Person nor to
Powertel's knowledge are there any valid grounds for any bona fide claim of any
such kind. To Powertel's knowledge, there is no material unauthorized use,
infringement or misappropriation of any of the Intellectual Property Rights by
any third party, employee or former employee of Powertel or the Powertel
Subsidiaries.
SECTION 2.17 Opinion of Financial Advisor. The Board of Directors of
Powertel has received the oral opinion of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
("Powertel Financial Advisor"), on the date hereof, to the
-15-
20
effect that, as of the date hereof, the consideration to be received in the
Reorganization by Powertel's stockholders is fair to Powertel's stockholders
from a financial point of view.
SECTION 2.18 Brokers. Except for the Powertel Financial Advisor, the fees
and expenses of which will be paid by Powertel (and are reflected in an
agreement with Powertel, a true and correct copy of which has been furnished to
and accepted by VoiceStream), no broker, investment banker, financial advisor or
other person is entitled to any broker's, finder's, financial advisor's or other
similar fee or commission in connection with the transactions contemplated by
this Agreement based upon arrangements made by or on behalf of Powertel. In no
event shall the amounts paid or payable by Powertel to the Powertel Financial
Advisor in connection with the transactions contemplated by this Agreement
exceed $23,000,000.
SECTION 2.19 Tax Status. To the knowledge of Powertel after due
investigation, neither Powertel nor any of its Affiliates has taken any action
or failed to take any action which action or failure would jeopardize the
qualification of the Merger as a reorganization within the meaning of Section
368(a) of the Code. To the knowledge of Powertel after due investigation, there
are no facts or circumstances relating to Powertel or its Affiliates, including
any covenants or undertakings of Powertel pursuant to this Agreement, that would
prevent ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇, LLP from delivering the opinion referred to in
Section 6.02(b) as of the date hereof.
SECTION 2.20 Contracts. Except as set forth in the Powertel Filed SEC
Documents or in Item 2.20 of the Powertel Letter, and except for this Agreement,
the Powertel Merger Agreement and the agreements referenced hereby and thereby,
neither Powertel nor any of the Powertel Subsidiaries is a party to or bound by:
(i) any "material contract" (as such term is defined in Item 601(b)(10) of
Regulation S-K of the SEC) or any agreement, contract or commitment the loss or
termination of which could have a Material Adverse Effect on Powertel; (ii) any
non-competition agreement or any similar agreement or obligation which
materially limits or could materially limit Powertel or any of the Powertel
Subsidiaries from engaging in the business of providing wireless communications
services or from developing wireless communications technology anywhere in the
world; or (iii) any management agreement, technical services agreement or other
agreement whereby Powertel or any of the Powertel Subsidiaries is providing or
is required to provide management or technical services to any other Person.
Taken as a whole, the contracts and agreements required to be filed by Powertel
with the SEC together with the contracts and agreements required to be set forth
on Item 2.20 of the Powertel Letter are collectively referred to as the
"Powertel Contracts"). With such exceptions as, individually or in the
aggregate, have not had, and could not be reasonably expected to have, a
Material Adverse Effect on Powertel, (x) each of the Powertel Contracts is valid
and in full force and effect (except to the extent they have previously expired
in accordance with their terms), and (y) except as set forth in Item 2.20 of the
Powertel Letter, neither Powertel nor any of the Powertel Subsidiaries has
violated any provision of, or committed or failed to perform any act which, with
or without notice, lapse of time, or both, would constitute a default under the
provisions of any Powertel Contract. To the knowledge of Powertel, no
counterparty to any such contract, agreement or commitment has violated any
provision of, or committed or failed to perform any act which, with or without
notice, lapse of time, or both would constitute a default or other breach under
the provisions of, such Powertel Contract, except for defaults or breaches
which, individually or in the aggregate, have not had, or would not reasonably
be expected to have, a Material Adverse Effect on Powertel. Neither Powertel nor
any of the Powertel Subsidiaries is a party to, or otherwise a guarantor of or
liable with respect to, any interest rate, currency or other swap or derivative
transaction, other than any such transactions which are not material to the
business of Powertel or the Powertel Subsidiaries. Powertel has provided or made
available to VoiceStream a copy of each agreement described in item (i), (ii)
and (iii) above. The designation or definition of Powertel Contracts for
purposes of this Section 2.20 and the disclosures made pursuant hereto shall not
be construed or utilized to expand, limit or define the terms "material" and
"Material Adverse Effect" as otherwise referenced and used in this Agreement.
SECTION 2.21 Vote Required. The only vote of the holders of any class or
series of capital stock of Powertel necessary to approve this Agreement and the
transactions contemplated hereby is the Powertel Stockholder Approval. As of the
date hereof, the Powertel Principal Stockholders have the requisite voting power
to satisfy the Powertel Stockholder Approval.
-16-
21
SECTION 2.22 Transactions with Affiliates. Except as described in Item
2.22 of the Powertel Letter or in the Powertel Filed SEC Documents, to
Powertel's knowledge, no director or executive officer of Powertel or any 5% or
greater stockholder of Powertel is at the date hereof a party to any transaction
with Powertel or any of the Powertel Subsidiaries in which the amount involved
exceeds $60,000, including any contract or arrangement providing for the
furnishing of services to or by, providing for rental of real or personal
property (including intellectual property) to or from, or otherwise requiring
payments to or from Powertel or any of the Powertel Subsidiaries.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF VOICESTREAM
Except as disclosed in the VoiceStream Filed SEC Documents and except as
set forth in the VoiceStream Letter (it being agreed that disclosure of any item
in the VoiceStream Letter shall be deemed disclosure with respect to any section
of this Agreement to which the relevance of such item is reasonably apparent),
VoiceStream hereby represents and warrants as of the date hereof to Powertel as
follows:
SECTION 3.01 Organization. Each of VoiceStream and its Subsidiaries
(collectively, the "VoiceStream Subsidiaries") is a corporation or limited
liability company duly organized, validly existing and in good standing (where
such concept is applicable) under the laws of the jurisdiction of its
incorporation or organization and has the requisite power and authority to carry
on its business as now being conducted, except where the failure to be so
organized, existing and in good standing or to have such power and authority
could not reasonably be expected to have a Material Adverse Effect on
VoiceStream or prevent or materially delay the consummation of the
Reorganization. VoiceStream is, and Sub will be when incorporated, duly
qualified or licensed to do business and is in good standing (where such concept
is applicable) in each jurisdiction in which the nature of its business or the
ownership or leasing of its properties makes such qualification or licensing
necessary, except in such jurisdictions where the failure to be so duly
qualified or licensed and in good standing (where such concept is applicable)
could not reasonably be expected to have a Material Adverse Effect on
VoiceStream or prevent or materially delay the consummation of the
Reorganization. VoiceStream has delivered to Powertel complete and correct
copies of its Certificate of Incorporation and By-laws and has made available to
Powertel the certificate of incorporation and by-laws (or similar organizational
documents) of each of the VoiceStream Subsidiaries.
SECTION 3.02 Ownership of Sub. As of the Effective Time (i) all of the
outstanding shares of capital stock of Sub will be validly issued and fully paid
and nonassessable, and (ii) all of the outstanding shares of capital stock of
Sub will be owned by VoiceStream.
SECTION 3.03 Capital Structure. (a) The authorized capital stock of
VoiceStream consists solely of (i) 1,000,000,000 shares of VoiceStream Common
Stock, of which, as of July 31, 2000, (A) 214,617,441 shares were issued and
outstanding, including the restricted shares listed on Item 3.03 of the
VoiceStream Letter, (B) no shares were held in the treasury of VoiceStream, (C)
9,625,762 shares were issuable upon the exercise of options outstanding under
the VoiceStream 2000 Management Incentive Stock Option Plan, and (D) 274,844
shares were issuable upon the exercise of the warrants described in Item 3.03 of
the VoiceStream Letter, and (ii) 100,000,000 shares of preferred stock, $0.001
par value, of VoiceStream, of which, as of July 31, 2000, 7,606 2 1/2%
Convertible Preferred Shares were issued and outstanding and owned by ▇▇▇▇▇▇▇▇▇
Telecommunications PCS (USA) Limited, which shares, as of the date hereof, are
convertible into 26,227,586 shares of VoiceStream Common Stock. The authorized
capital stock of Omnipoint Corporation consists solely of (i) 200,000,000 shares
of common stock $0.01 par value, of which, as of July 31, 2000, 65,000,000
shares were issued and outstanding and owned by VoiceStream, and (ii) 10,000,000
shares of preferred stock, $0.01 par value, of which, as of July 31, 2000,
6,355,195 shares of 7% Convertible Preferred Stock were issued and outstanding,
which shares are convertible, as of the date hereof, into 8,425,082 shares of
VoiceStream Common Stock. Except as set forth in Item 3.03 of the VoiceStream
Letter or permitted by the DT Merger Agreement and as to the exchange rights
relating to the ▇▇▇▇ Inlet Joint Ventures as set forth on Item 3.03 of the
VoiceStream Letter ("Exchange Rights"), (i) since July 31, 2000, no shares of
VoiceStream Common Stock have been issued, except upon the exercise of options
or the warrants described in the
-17-
22
immediately preceding sentence, and (ii) as of July 31, 2000, there are no
outstanding VoiceStream Equity Rights. For purposes of this Agreement,
"VoiceStream Equity Rights" means subscriptions, options, warrants, calls,
commitments, agreements, conversion rights, exchange rights or other rights of
any character (contingent or otherwise) to purchase or otherwise acquire from
VoiceStream or any of VoiceStream's Subsidiaries or any ▇▇▇▇ Inlet Joint Venture
at any time any shares of the capital stock or other voting or non-voting
securities of VoiceStream. Item 3.03 of the VoiceStream Letter sets forth a
complete and accurate list of all outstanding VoiceStream Equity Rights as of
July 31, 2000 (provided that, with respect to options, such list need only set
forth the aggregate number of options with weighted-average exercise prices at
which grants have been made and need not specify grants by grantee). Since July
31, 2000, no VoiceStream Equity Rights have been issued except (1) after the
date hereof, as permitted by Section 4.01 of the DT Merger Agreement or as a
result of the transactions permitted by Section 5.15 of the DT Merger Agreement,
(2) pursuant to the VoiceStream stock plans listed on Item 3.03(a) of the
VoiceStream Letter, or (3) pursuant to the Exchange Rights.
(b) Except as set forth on Item 3.03 of the VoiceStream Letter, there are
no outstanding obligations of VoiceStream or any of VoiceStream's Subsidiaries
or any ▇▇▇▇ Inlet Joint Venture to repurchase, redeem or otherwise acquire any
shares of capital stock of VoiceStream.
(c) All shares of issued and outstanding VoiceStream Common Stock are
validly issued, fully paid and nonassessable, and the shares of VoiceStream
Common Stock to be issued to the Powertel Stockholders pursuant to this
Agreement are not subject to any preemptive rights.
(d) All the outstanding capital stock of each of the VoiceStream
Subsidiaries and each of the ▇▇▇▇ Inlet Joint Ventures which is owned by
VoiceStream is duly authorized, validly issued, fully paid and nonassessable and
owned by VoiceStream or one of the VoiceStream Subsidiaries free and clear of
any Liens except for Liens which are granted to secure indebtedness and are
disclosed in Item 3.03 of the VoiceStream Letter. Except as set forth on Item
3.03 of the VoiceStream Letter and as to the Exchange Rights, except as
hereafter issued or entered into in accordance with the DT Merger Agreement,
there are no material existing subscriptions, options, warrants, calls,
commitments, agreements, conversion rights, exchange rights or other rights of
any character (contingent or otherwise) to purchase or otherwise acquire from
VoiceStream or any VoiceStream Subsidiary or any ▇▇▇▇ Inlet Joint Venture at any
time any shares of the capital stock or other voting or non-voting securities or
partnership interests or membership interests of any VoiceStream Subsidiary or
any ▇▇▇▇ Inlet Joint Venture, whether or not presently issued or outstanding
(except for rights of first refusal to purchase interests in Subsidiaries which
are not wholly owned by VoiceStream and the ▇▇▇▇ Inlet Joint Ventures), and
there are no outstanding obligations of VoiceStream or any of the VoiceStream
Subsidiaries or the ▇▇▇▇ Inlet Joint Ventures to repurchase, redeem or otherwise
acquire any shares of capital stock or other voting or non-voting securities or
partnership interests or membership interests of VoiceStream or any of the
VoiceStream Subsidiaries or any ▇▇▇▇ Inlet Joint Venture.
(e) No bonds, debentures, notes or other indebtedness of VoiceStream having
the right to vote on any matters on which stockholders may vote are issued or
outstanding except for any securities issued after the date hereof in accordance
with Section 4.01 of the DT Merger Agreement.
SECTION 3.04 Authority. The Board of Directors of VoiceStream, at a
meeting duly called and held, duly adopted resolutions (i) approving this
Agreement, the Reorganization, the Powertel Stockholder Agreements and the
VoiceStream Stockholder Agreements, (ii) determining that the Reorganization,
including the Merger, and the issuance of shares of VoiceStream Common Stock in
accordance with the Reorganization, is fair to and in the best interests of
VoiceStream stockholders and (iii) recommending that the VoiceStream
stockholders approve and adopt this Agreement. VoiceStream has the requisite
corporate power and authority to execute and deliver this Agreement and the
other agreements to which it is a party that are referenced herein and, subject
to the approval and adoption of this Agreement by a majority of the votes cast
at a meeting by the holders of the VoiceStream Common Stock (the "VoiceStream
Stockholder Approval"), to consummate the transactions contemplated hereby. The
execution, delivery and performance of this Agreement by VoiceStream and the
consummation by VoiceStream of the Reorganization and of the other transactions
contemplated hereby have been duly authorized by all necessary corporate action
on the
-18-
23
part of VoiceStream, subject to the VoiceStream Stockholder Approval. This
Agreement has been duly executed and delivered by VoiceStream and (assuming the
valid authorization, execution and delivery of this Agreement by Powertel)
constitutes the valid and binding obligation of VoiceStream enforceable in
accordance with its terms, except that such enforceability (i) may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting or relating to the enforcement of creditors' rights and remedies
generally and (ii) is subject to general principles of equity (regardless of
whether considered in a proceeding in equity or at law). The issuance of shares
of VoiceStream Common Stock in connection with the Reorganization and the filing
of a registration statement on Form S-4 with the SEC by VoiceStream under the
Securities Act for the purpose of registering the shares of VoiceStream Common
Stock to be issued in connection with the Reorganization (together with any
amendments or supplements thereto, whether prior to or after the effective date
thereof, the "Registration Statement") have been duly authorized by
VoiceStream's Board of Directors.
SECTION 3.05 Consents and Approvals; No Violations. Except as set forth in
Item 3.05 of the VoiceStream Letter, and except for filings, permits,
authorizations, consents and approvals as may be required under, and other
applicable requirements of, the Securities Act, state securities or "Blue Sky"
laws, the Exchange Act, the Communications Act, the HSR Act, the DGCL, the
rules, regulations and published decisions of the FAA, the FCC and state public
utility or service commissions or similar agencies, or the rules and regulations
of Nasdaq (collectively, the "VoiceStream Required Approvals" and together with
the Powertel Required Approvals, the "Required Regulatory Approvals"), neither
the execution, delivery or performance of this Agreement by VoiceStream nor the
consummation by VoiceStream of the transactions contemplated hereby will (i)
violate or conflict with the Certificate of Incorporation or By-laws of
VoiceStream, (ii) require any filing with, or permit, authorization, consent or
approval of, any Governmental Entity (except where the failure to obtain such
permits, authorizations, consents or approvals or to make such filings could not
reasonably be expected to have a Material Adverse Effect on VoiceStream or
prevent or materially delay the consummation of the Reorganization), (iii)
result in a violation or breach of, or constitute (with or without due notice or
lapse of time or both) a default (or give rise to any right of termination,
amendment, cancellation or acceleration) under, any of the terms, conditions or
provisions of any note, bond, mortgage, indenture, license, lease, contract,
agreement or other instrument or obligation to which VoiceStream or any of the
VoiceStream Subsidiaries is a party or by which any of their respective
properties are bound, (iv) violate any order, writ, judgment, injunction,
decree, statute, rule or regulation applicable to VoiceStream or any of the
VoiceStream Subsidiaries or by which any of their respective properties are
bound, or (v) result in the creation or imposition of any Lien on any asset of
VoiceStream or the VoiceStream Subsidiaries, except in the case of clauses
(iii), (iv) or (v) for violations, breaches or defaults that could not
reasonably be expected to have a Material Adverse Effect on VoiceStream or
prevent or materially delay the consummation of the Reorganization.
SECTION 3.06 SEC Documents and Other Reports. VoiceStream has filed with
the SEC all documents required to be filed by it since January 1, 1999 under the
Securities Act or the Exchange Act (the "VoiceStream SEC Documents"). As of
their respective filing dates, the VoiceStream SEC Documents were prepared
substantially in accordance with the requirements of the Securities Act or the
Exchange Act, as the case may be, each as in effect on the date so filed, and at
the time filed with the SEC (or if amended or superseded by a filing prior to
the date hereof, then on the date of such filing) none of the VoiceStream SEC
Documents contained any untrue statement of a material fact or omitted to state
a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading. The financial statements of VoiceStream included in the
VoiceStream SEC Documents have been prepared in accordance with generally
accepted accounting principles (except in the case of the unaudited statements,
under the Exchange Act) applied on a consistent basis during the periods
involved (except as may be indicated therein or in the notes thereto) and fairly
present the consolidated financial position of VoiceStream and the consolidated
VoiceStream Subsidiaries as of the respective dates thereof and the consolidated
results of operations and consolidated cash flows for the periods then ended
(subject, in the case of unaudited statements, to normal year-end audit
adjustments and to any other adjustments described therein).
-19-
24
SECTION 3.07 Absence of Material Adverse Change. Except as disclosed in
Item 3.07 of the VoiceStream Letter or in the documents filed by VoiceStream
with the SEC and publicly available prior to the date of this Agreement (the
"VoiceStream Filed SEC Documents"), since December 31, 1999, VoiceStream and the
VoiceStream Subsidiaries have conducted their respective businesses in all
material respects only in the ordinary course, consistent with past practices,
and there has not been (i) any Material Adverse Change with respect to
VoiceStream, (ii) any declaration, setting aside or payment of any dividend or
other distribution with respect to its capital stock (other than regular
quarterly cash dividends) or any redemption, purchase or other acquisition of
any of its capital stock, (iii) any split, combination or reclassification of
any of its capital stock or any issuance or the authorization of any issuance of
any other securities in respect of, in lieu of or in substitution for shares of
its capital stock, or (iv) any material change in accounting methods, principles
or practices by VoiceStream affecting its assets, liabilities or business,
except insofar as may have been required by a change in generally accepted
accounting principles.
SECTION 3.08 Information Supplied. None of the information supplied or to
be supplied by VoiceStream specifically for inclusion or incorporation by
reference in (i) the Registration Statement or (ii) the Joint Proxy Statement,
will, in the case of the Registration Statement, at the time it becomes
effective, contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading, or in the case of the Joint Proxy Statement, at the time of the
first mailing of the Joint Proxy Statement or the time of the Stockholder
Meetings, contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary in order to make the
statements therein, in light of the circumstances under which they are made, not
misleading. The Registration Statement will comply (with respect to VoiceStream)
as to form in all material respects with the requirements of the Securities Act,
and the Joint Proxy Statement will comply (with respect to VoiceStream) as to
form in all material respects with the requirements of the Exchange Act.
VoiceStream makes no representation or warranty with respect to any information
supplied by Powertel or any other Person who is not an Affiliate of VoiceStream
which is contained in the Registration Statement or the Joint Proxy Statement.
SECTION 3.09 Permits; Compliance with Laws. (a) Each of VoiceStream and
the VoiceStream Subsidiaries is in possession of all franchises, grants,
authorizations, licenses, permits, charters, easements, variances, exceptions,
consents, certificates, approvals and orders of any Governmental Entity
necessary for VoiceStream or any of the VoiceStream Subsidiaries to own, lease
and operate its properties or to carry on its business as it is now being
conducted (the "VoiceStream Permits"), except where the failure to have any of
the VoiceStream Permits could not, individually or in the aggregate, have a
Material Adverse Effect on VoiceStream and, as of the date of this Agreement, no
suspension or cancellation of any of the VoiceStream Permits is pending or, to
the knowledge of VoiceStream, threatened, except where the suspension or
cancellation of any of the VoiceStream Permits could not reasonably be expected
to have, individually or in the aggregate, a Material Adverse Effect on
VoiceStream. The business of VoiceStream and the VoiceStream Subsidiaries is not
being conducted in violation of any law, ordinance or regulation of any
Governmental Entity, except for possible violations that could not reasonably be
expected to have a Material Adverse Effect on VoiceStream or prevent or
materially delay the consummation of the Reorganization.
(b) Except as set forth in Item 3.09 of the VoiceStream Letter:
(i) VoiceStream and each of the VoiceStream Subsidiaries holds, and is
qualified and eligible to hold, all material licenses, permits and other
authorizations issued or to be issued by the FCC to such entity for the
operation of their respective businesses, all of which are set forth in
Item 3.09 of the VoiceStream Letter (the "VoiceStream FCC Licenses").
(ii) The VoiceStream FCC Licenses are valid and in full force and
effect, and neither VoiceStream nor any of the VoiceStream Subsidiaries is
or has been delinquent in payment on or in default under any installment
obligation owed to the United States Treasury in connection with the
VoiceStream FCC Licenses. As used herein, the term "full force and effect"
means that (A) the orders issuing the VoiceStream FCC Licenses have become
effective, (B) no stay of effectiveness of such orders has been
-20-
25
issued by the FCC, and (C) the VoiceStream FCC Licenses have not been
invalidated by any subsequent published FCC action.
(iii) All material reports and applications required by the
Communications Act or required to be filed with the FCC by VoiceStream or
any of the VoiceStream Subsidiaries have been filed and are accurate and
complete in all material respects.
(iv) VoiceStream and the VoiceStream Subsidiaries are, and have been,
in compliance in all material respects with, and the wireless
communications systems operated pursuant to the VoiceStream FCC Licenses
are and have been operated in compliance in all material respects with, the
Communications Act.
(v) There is not pending or, to VoiceStream's knowledge, threatened,
as of the date hereof any application, petition, objection, pleading or
proceeding with the FCC or any public service commission or similar body
having jurisdiction or authority over the communications operations of
VoiceStream or any of the VoiceStream Subsidiaries which is reasonably
likely to result in the revocation, cancellation, suspension, dismissal,
denial or any materially adverse modification of any VoiceStream FCC
License or imposition of any substantial fine or forfeiture against
VoiceStream or any of the VoiceStream Subsidiaries.
(vi) No facts are known to VoiceStream or the VoiceStream Subsidiaries
which if known by a Governmental Entity of competent jurisdiction would
present a substantial risk that any VoiceStream FCC License could be
revoked, cancelled, suspended or materially adversely modified or that any
substantial fine or forfeiture could be imposed against VoiceStream or any
of the VoiceStream Subsidiaries.
(vii) VoiceStream and the VoiceStream Subsidiaries have not made any
material misstatements of fact, or omitted to disclose any fact, to any
Government Entity or in any report, document or certificate filed
therewith, which misstatements or omissions, individually or in the
aggregate, could reasonably be expected to subject any material VoiceStream
FCC Licenses to revocation or failure to renew, except to the extent that
such revocation or failure to renew would not have a Material Adverse
Effect on VoiceStream or the transactions contemplated by this Agreement.
SECTION 3.10 Tax Matters. Except as set forth in Item 3.10 of the
VoiceStream Letter or as would not have a Material Adverse Effect on
VoiceStream, (i) VoiceStream and each of the VoiceStream Subsidiaries have
timely filed (after taking into account any extensions to file) all Tax Returns
required to be filed by them either on a separate or combined or consolidated
basis; (ii) all such Tax Returns are correct in all respects and accurately
disclose in all respects all Taxes required to be paid for the periods covered
thereby; (iii) VoiceStream and the VoiceStream Subsidiaries have paid or caused
to be paid all Taxes shown as due on such Tax Returns and all Taxes for which no
Tax Return was required to be filed, and the financial statements contained in
the VoiceStream SEC Documents reflect an adequate reserve as determined in
accordance with generally acceptable accounting principles for all material
Taxes payable by VoiceStream and the VoiceStream Subsidiaries and not yet due
(other than a reserve for deferred Taxes established to reflect timing
differences between book and Tax treatment) for all taxable periods and portions
thereof accrued through the date of such financial statements; (iv) neither
VoiceStream nor any VoiceStream Subsidiary has waived in writing any statute of
limitations in respect of Taxes; (v) there is no action, suit, investigation,
audit, claim or assessment that has been formally commenced or proposed to
VoiceStream in writing with respect to Taxes of VoiceStream or any of the
VoiceStream Subsidiaries; (vi) there are no Liens for Taxes upon the assets of
VoiceStream or any VoiceStream Subsidiary except for Liens relating to current
Taxes not yet due; (vii) all Taxes which VoiceStream or any VoiceStream
Subsidiary is required by law to withhold or to collect for payment have been
duly withheld and collected, and have been paid or accrued on the books of
VoiceStream or such VoiceStream Subsidiary; (viii) none of VoiceStream or any
VoiceStream Subsidiary has been a member of any group of corporations filing Tax
Returns on a consolidated, combined, unitary or similar basis other than each
such group of which it is currently a member; (ix) no deduction of any amount
that would otherwise be deductible by VoiceStream or any of the VoiceStream
Subsidiaries with respect to taxable periods ending on or before the Effective
Time could be disallowed under Section 162(m) of the Code; and
-21-
26
(x) neither VoiceStream nor any of the VoiceStream Subsidiaries is a "United
States real property holding corporation" within the meaning of Section
897(c)(2) of the Code.
SECTION 3.11 Liabilities. Except as set forth in the VoiceStream Filed SEC
Documents and as permitted by this Agreement, VoiceStream and the VoiceStream
Subsidiaries, taken as a whole, do not have any liabilities or obligations of
any nature (whether accrued, absolute, contingent or otherwise) required by
generally accepted accounting principles to be set forth on a consolidated
balance sheet of VoiceStream and the VoiceStream Subsidiaries or in the notes
thereto, other than (i) liabilities and obligations incurred in the ordinary
course of business since December 31, 1999 and (ii) liabilities arising after
December 31, 1999 which could not, individually or in the aggregate, reasonably
be expected to have a Material Adverse Effect on VoiceStream.
SECTION 3.12 Litigation. Except as disclosed in Item 3.12 of the
VoiceStream Letter or in the VoiceStream Filed SEC Documents, as of the date of
this Agreement, there is no suit, action, proceeding or investigation pending
or, to VoiceStream's knowledge, threatened, against VoiceStream or any of the
VoiceStream Subsidiaries before any Governmental Entity that, individually or in
the aggregate, would reasonably be expected to have a Material Adverse Effect on
VoiceStream or prevent or materially delay the consummation of the
Reorganization. Except as disclosed in Item 3.12 of the VoiceStream Letter or in
the VoiceStream Filed SEC Documents, neither VoiceStream nor any of the
VoiceStream Subsidiaries is subject to any outstanding judgment, order, writ,
injunction or decree that could, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect on VoiceStream.
SECTION 3.13 State Takeover Statutes. To the knowledge of VoiceStream, no
state antitakeover statute or similar statute or regulation applicable to
VoiceStream is applicable to this Agreement or the transactions contemplated
hereby. To the knowledge of VoiceStream, no other "control share acquisition,"
"fair price," "moratorium" or other antitakeover laws or regulations enacted
under Washington or Delaware state laws applicable to VoiceStream apply to this
Agreement or any of the transactions related thereto.
SECTION 3.14 Brokers. No broker, investment banker, financial advisor or
other person, other than ▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co., the fees and expenses of which
will be paid by VoiceStream and are reflected in an agreement between ▇▇▇▇▇▇▇,
Sachs & Co. and VoiceStream, is entitled to any broker's, finder's, financial
advisor's or other similar fee or commission in connection with the transactions
contemplated by this Agreement based upon arrangements made by or on behalf of
VoiceStream.
SECTION 3.15 Tax Status. To the knowledge of VoiceStream after due
investigation, neither VoiceStream nor any of its Affiliates has taken any
action or failed to take any action which action or failure would jeopardize the
qualification of the Merger as a reorganization within the meaning of Section
368(a) of the Code. To the knowledge of VoiceStream after due investigation,
there are no facts or circumstances relating to VoiceStream or its Affiliates,
including any covenants or undertakings of VoiceStream pursuant to this
Agreement, that would prevent ▇▇▇▇▇, Day, ▇▇▇▇▇▇ & ▇▇▇▇▇ and/or ▇▇▇▇▇▇▇ ▇▇▇▇▇ &
▇▇▇▇▇ LLP from delivering the opinion referred to in Section 6.03(b) as of the
date hereof.
SECTION 3.16 Interim Operations and Performance of Sub. Sub is a
newly-formed single purpose corporation which has been formed solely for the
purpose of engaging in the transactions contemplated hereby, shall engage in no
other business or activities and shall have conducted its operations only as
contemplated hereby. VoiceStream shall have caused Sub to take all action
required pursuant to this Agreement prior to the Effective Time, including the
approval and adoption of this Agreement.
SECTION 3.17 Vote Required. The Merger requires the approval by
VoiceStream as the stockholder of Sub. The only vote required by the
stockholders of VoiceStream to approve this Agreement and the transactions
contemplated hereby is the VoiceStream Stockholder Approval.
SECTION 3.18 Transactions with Affiliates. Except as described in Item
3.18 of the VoiceStream Letter or the VoiceStream Filed SEC Documents, to
VoiceStream's knowledge, no director or executive officer of VoiceStream or any
5% or greater stockholder of VoiceStream is at the date hereof a party to any
transaction with VoiceStream or any of the VoiceStream Subsidiaries in which the
amount involved exceeds $60,000, including any contract or arrangement providing
for the furnishing of services to or by, providing for
-22-
27
rental of real or personal property (including intellectual property) to or
from, or otherwise requiring payments to or from VoiceStream or any of the
VoiceStream Subsidiaries.
SECTION 3.19 Opinion of ▇▇▇▇▇▇▇, Sachs & Co. The Board of Directors of
VoiceStream has received the oral opinion of ▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co. on the date
hereof, to the effect that, as of the date hereof, the Conversion Number
pursuant to this Agreement is fair to VoiceStream from a financial point of
view.
ARTICLE IV
COVENANTS RELATING TO CONDUCT OF BUSINESS
SECTION 4.01 Conduct of Business by Powertel Pending the
Reorganization. During the period from the date of this Agreement until the
earlier of the Effective Time or the termination of this Agreement, Powertel
shall, and shall cause each of the Powertel Subsidiaries to, in all material
respects, except as contemplated by this Agreement or the Powertel Merger
Agreement or as disclosed in the Powertel Letter (including disclosures
regarding the DiGiPH Transaction) or unless VoiceStream shall otherwise agree in
writing in advance of the specific action taken, carry on its business in the
ordinary course. Without limiting the generality of the foregoing, and except as
otherwise contemplated by this Agreement or the Powertel Merger Agreement or as
disclosed in the Powertel Letter, during such period, Powertel shall not, and
shall not permit any of the Powertel Subsidiaries to, without the prior written
consent of VoiceStream:
(a) except for regularly scheduled dividends payable on the Series E
Preferred Shares and Series F Preferred Shares in Powertel Common Stock,
(i) declare, set aside or pay any dividends on, or make any other
distributions in respect of, or redeem or repurchase, any of its capital
stock or other equity interest, except for dividends by a Powertel
Subsidiary to its parent, and except that Powertel shall be permitted to
acquire shares of Powertel Common Stock, from time to time, to the extent
required by (A) Section 5.4 of the Restated Certificate of Incorporation of
Powertel and (B) any Powertel Stock Option Plan in connection with the
exercise of options and other rights granted thereunder; or (ii) split,
combine or reclassify any of its capital stock or other equity interest or
issue or authorize the issuance of any other securities in respect of, in
lieu of or in substitution for shares of its capital stock;
(b) issue, deliver, sell, pledge or otherwise encumber any shares of
its capital stock or other equity interest, any other voting securities or
any securities convertible into, or any rights, warrants or options to
acquire, any such shares, voting securities or convertible securities,
except for issuances of Powertel Common Stock or Powertel Common Stock
Equivalents as set forth in Item 4.01(b) of the Powertel Letter or
deliveries of shares of its capital stock pursuant to contractual
obligations existing prior to the execution of this Agreement and which are
otherwise disclosed in this Agreement or the Powertel Letter;
(c) amend the Restated Certificate of Incorporation of Powertel or
Restated By-laws of Powertel or other similar organizational documents;
(d) adopt, amend or propose to amend any stockholder rights plan or
related rights plan;
(e) acquire, or agree to acquire, in a single transaction or in a
series of related transactions, any business, corporation or partnership,
or substantially all of the assets of any of the foregoing, other than (i)
transactions which involve individually or in the aggregate a purchase
price not in excess of $500,000, (ii) capital expenditures described in
Section 4.01(f) below and (iii) transactions in connection with the DiGiPH
Transaction;
(f) make or agree to make any new capital expenditure other than
capital expenditures (i) in fiscal year 2000 that are contemplated by
Powertel's capital budget for fiscal year 2000, provided the aggregate
amount of such capital expenditures is less than $177 million, or (ii) in
fiscal year 2001 that are contemplated by Powertel's business plan for
fiscal year 2001, as approved by the Board of Directors of Powertel,
provided the aggregate amount of such capital expenditures is less than
$181.5 million;
(g) sell, lease, license, encumber or otherwise dispose of, or agree
to sell, lease, license, encumber or otherwise dispose of, any of its
assets, other than as set forth in Item 4.01(g) of the Powertel Letter or
in
-23-
28
connection with transactions that are in the ordinary course of business
and which involve assets having a current value not in excess of $500,000
individually or in the aggregate (for avoidance of doubt, the sale, lease,
license, encumbrance or other disposition of any of the Powertel FCC
Licenses or other material assets shall not be in the ordinary course of
business);
(h) increase the salary, wages, stipends, bonuses or reimbursable
allowances payable or to become payable to its directors or officers,
except for increases for officers in the ordinary course of business
consistent with past practices; or enter into any employment or severance
agreement with, or establish, adopt, enter into or amend, or make any
grants or awards under, any Powertel Benefit Plan for the benefit of, any
director, officer or employee, except, in each case in the ordinary course
of business consistent with past practices or adopt or amend any Powertel
Benefit Plan except those specifically set forth in Annex 5.18 or take any
action inconsistent with the provisions set forth in Annex 5.18, provided,
that the aggregate increase in such compensation shall not exceed 5% of the
previous year's amount (including those with respect to the timing and
amount of, and persons entitled to, grants and awards), as may be required
by the terms of any such Powertel Benefit Plan, or to comply with
applicable law or as permitted by Section 4.01(b), provided, further, that
nothing in this Section 4.01(h) shall restrict the ability of Powertel's
Board of Directors to take the action contemplated by and to comply with
the terms of the severance, retention and other plans and arrangements as
set forth in Annex 5.18 and to adopt appropriate resolutions with respect
to persons who are officers or directors (including persons who are
directors by deputization) of Powertel to cause the transactions relating
to the Reorganization that may be considered dispositions under Section 16
of the Exchange Act for such persons to be exempt from such Section;
(i) except as may be required as a result of a change in law or in
generally accepted accounting principles, make any change in its method of
accounting or its fiscal year;
(j) except in connection with the transactions contemplated hereby,
enter into, modify in any material respect, amend in any material respect
or terminate any material contract or agreement to which Powertel or any of
the Powertel Subsidiaries is a party, or waive, release or assign any
material rights or claims, except to the extent that such contract
agreement, modification or amendment would not reasonably be expected to
have a Material Adverse Effect on Powertel;
(k) amend any term of any of its outstanding securities in any
material respect;
(l) adopt a plan or agreement of complete or partial liquidation,
dissolution, merger, consolidation, restructuring, recapitalization or
other material reorganization;
(m) incur, assume or guarantee any material Indebtedness, including
any refinancing of existing Indebtedness, for borrowed money unless such
Indebtedness is prepayable at the election of Powertel on or after the
Closing Date and the aggregate prepayment penalty and all other fees
associated with such Indebtedness do not exceed $1,000,000;
(n) create, incur, assume or suffer to exist any material Lien upon
any of its property or assets, whether now owned or hereafter acquired,
other than Liens incurred in the ordinary course of business or to secure
Indebtedness, Liens arising by operation of law and not yet due and payable
or other obligations permitted by this Agreement (including refinancing of
existing Indebtedness);
(o) create, incur, assume or suffer to exist any obligation whereby
Powertel or the Powertel Subsidiaries guarantees any Indebtedness, leases,
dividends or other obligations of any third party;
(p) make any loan or capital contributions to or investment in any
Person, other than in the ordinary course of business or as set forth in
Item 4.01(p) of the Powertel Letter, as required in connection with the
DiGiPH Transaction and loans or capital contributions to or investments in
wholly owned Powertel Subsidiaries;
(q) enter into any agreement or arrangement that materially limits or
otherwise materially restricts Powertel or any of the Powertel Subsidiaries
or any successor thereto or that could, after the Effective Time,
reasonably be expected to materially limit or restrict VoiceStream, any of
the VoiceStream Subsidiaries or the Surviving Corporation from engaging in
the business of providing wireless communi-
-24-
29
cations services or developing wireless communications technology anywhere
in the world or otherwise from engaging in any other business;
(r) initiate, settle, or appeal or propose to settle, initiate or
appeal any material litigation, investigation, arbitration, proceeding or
other claim;
(s) make any material tax election or enter into any settlement or
compromise of any material tax liability;
(t) take any action, other than as expressly permitted by this
Agreement, that could reasonably be expected to make any representation or
warranty of Powertel hereunder inaccurate and have a Material Adverse
Effect on Powertel at the Effective Time;
(u) adopt, amend or propose to amend any Powertel Benefit Plan or make
any discretionary contributions to any ERISA Benefit Plan other than as may
be required by law or as may be required to maintain compliance with
provisions of the Code; provided, however, Powertel (1) may make an annual
3% of compensation profit sharing contribution and (2) may make matching
contributions of 50% of the first 2% of compensation contributed by
participants, to Powertel's profit sharing Code sec. 401(k) plan (similar
to past practices);
(v) enter into (i) leveraged derivative contracts (defined as
contracts that use a factor to multiply the underlying index exposure) or
(ii) other derivative contracts except for the purpose of hedging known
interest rate and foreign exchange exposures or otherwise reducing
Powertel's cost of financing; provided, however, that employee stock
ownership plans and other pension and deferred compensation plans of
Powertel may enter into derivative contracts as part of their ordinary
course investment strategy;
(w) file any amended Tax Returns if the result of such amendment would
result in a material increase of Powertel's tax liability;
(x) take any action which would reasonably be expected to materially
adversely affect or materially delay the ability of any of the parties to
obtain any Powertel Required Regulatory Approval or consummate the
transactions contemplated hereby;
(y) take any action that would be reasonably likely to prevent or
impede the Merger from qualifying as a reorganization within the meaning of
Section 368(a) of the Code;
(z) other than pursuant to this Agreement, take any action to cause
the Powertel Common Stock to cease to be quoted on Nasdaq;
(aa) notwithstanding anything in this Agreement to the contrary,
during the period of time beginning on the fifth Business Day prior to the
Effective Time and extending until and including the Effective Time,
Powertel shall not take or omit to take any action that could increase the
number of shares of Powertel Stock outstanding on a fully diluted basis;
(bb) enter into any contract, agreement, commitment or arrangement to
do any of the foregoing.
SECTION 4.02 Conduct of Business by VoiceStream Pending the
Reorganization. During the period from the date of this Agreement until the
Effective Time, VoiceStream shall not, and shall not permit any of the
VoiceStream Subsidiaries to, without the prior written consent of Powertel:
(a) amend the Certificate of Incorporation or the By-laws or the
equivalent organizational documents of VoiceStream or of any VoiceStream
Subsidiary in any manner that would be adverse to Powertel or its
stockholders;
(b) effect any reclassification, recapitalization or restructuring or
other similar transaction that results in the direct or indirect receipt by
holders of VoiceStream Common Stock of any assets, property or cash in
respect of such VoiceStream Common Stock;
(c) take any action that would or could reasonably be expected to
prevent, impair or materially delay the ability of VoiceStream to
consummate the transactions contemplated by this Agreement;
-25-
30
(d) fail to make in a timely manner any filings with the SEC required
under the Securities Act or the Exchange Act or the Regulations promulgated
thereunder, provided that this provision shall not apply to any filings
with the SEC required to be made by any VoiceStream Subsidiary;
(e) change (i) its methods of accounting or accounting practices in
any material respect except as required by concurrent changes in generally
accepted accounting principles or by law or (ii) its fiscal year;
(f) enter into or acquire any new line of business that (i) is
material to VoiceStream and (ii) is not strategically related to the
current business or operations of VoiceStream;
(g) take any action that would reasonably be expected to have a
Material Adverse Effect or materially delay the ability of any of the
parties to obtain any VoiceStream Required Regulatory Approval; or
(h) enter into any contract, agreement, commitment or arrangement to
do any of the foregoing.
SECTION 4.03 No Solicitation.
(a) From and after the date hereof until the earlier of the Effective Time
or the termination of the Agreement, Powertel shall not, nor shall it permit any
of the Powertel Subsidiaries to, nor shall they authorize or permit any of their
respective officers, directors or employees to, and shall use their best efforts
to cause any investment banker, financial advisor, attorney, accountants or
other representatives retained by them or any of their respective Subsidiaries
not to, directly or indirectly through another Person, (i) solicit, initiate or
encourage (including by way of furnishing information), or knowingly take any
other action designed to facilitate, any Alternative Transaction (as defined
below), or (ii) continue or participate in any discussions or negotiations
regarding any Alternative Transaction; provided, however, that if, at any time
prior to the time that the Powertel Stockholders Approval is obtained, the Board
of Directors of Powertel receives an unsolicited bona fide proposal and
determines in good faith and after the receipt of advice from outside counsel
that providing information to the Third Party, making such proposal or
participating in negotiations or discussions with the Third Party is reasonably
likely to result in a Superior Proposal and if Powertel has fully and completely
complied with all its obligations under this Section 4.03, Powertel may, subject
to giving VoiceStream three (3) Business Days' advance written notice of its
intention to do so and obtaining a confidentiality agreement from the Third
Party substantially similar to the Confidentiality Agreement between Powertel
and VoiceStream dated as of March 9, 2000 (the "Confidentiality Agreement"), (x)
furnish information with respect to Powertel and the Powertel Subsidiaries, and
(y) engage in discussions and negotiations regarding such proposal.
(b) Powertel will notify VoiceStream promptly (but in no event later than
24 hours) after receipt by Powertel (or any of its advisors) of any Alternative
Transaction, or of any request (other than in the ordinary course of business
and not related to an Alternative Transaction) for non-public information
relating to Powertel or any of the Powertel Subsidiaries or for access to the
properties, books or records of Powertel or any of the Powertel Subsidiaries by
any Person who is known to be considering making, or has made, an Alternative
Transaction. Powertel shall provide such notice orally and in writing and shall
identify the Person making, and the terms and conditions of, any such
Alternative Transaction or request. Powertel shall keep VoiceStream fully
informed, on a prompt basis (but in any event no later than 24 hours), of the
status and details of any such Alternative Transaction or request. Powertel
shall, and shall cause the Powertel Subsidiaries and the directors, employees
and other agents of Powertel and the Powertel Subsidiaries to, cease immediately
and cause to be terminated all activities, discussions or negotiations, if any,
with any Persons conducted prior to the date hereof with respect to any
Alternative Transaction.
(c) Powertel (i) agrees not to release any Third Party from, or waive any
provision of, or fail to enforce, any standstill agreement or similar agreement
to which it is a party related to, or which could affect, an Alternative
Transaction and agrees that VoiceStream shall be entitled to enforce Powertel's
rights and remedies under and in connection with such agreements, and (ii)
acknowledges that the provisions of clause (i) are an important and integral
part of this Agreement. Nothing contained in this Section 4.03 or in Section
5.03 shall prohibit Powertel (x) from taking and disclosing to its stockholders
a position contemplated
-26-
31
by Rule 14d-9 or Rule 14e-2(a) promulgated under the Exchange Act, or (y) from
making any disclosure to its stockholders if, in the good faith judgment of the
Board of Directors of Powertel, after receipt of advice from outside counsel,
failure to disclose would result in a reasonable likelihood that the Board of
Directors of Powertel would breach its duties to Powertel's stockholders under
Delaware law.
(d) For purposes of this Agreement, "Alternative Transaction" means a
proposal or intended proposal, regarding any of (i) a transaction or series of
transactions pursuant to which any Person or "group" of Persons, other than
VoiceStream and its Subsidiaries (a "Third Party"), acquires or would acquire,
directly or indirectly, "beneficial ownership" (as such terms are defined in or
interpreted for purposes of Rule 13d-3 under the Exchange Act) of outstanding
shares representing more than twenty percent (20%) of the voting power of the
outstanding capital stock of Powertel or pursuant to a tender offer or exchange
offer or otherwise, (ii) any acquisition or proposed acquisition of, or business
combination with Powertel or any of the Powertel Subsidiaries, as applicable, by
a merger or other business combination (including any so-called "merger-of-
equals" and whether or not Powertel or any of the Powertel Subsidiaries, as the
case may be, is the entity surviving any such merger or business combination),
or (iii) any other transaction pursuant to which any Third Party acquires or
would acquire, directly or indirectly, control of assets (including for this
purpose the outstanding equity securities of the Powertel Subsidiaries and any
entity surviving the merger or business combination including any of them) of
Powertel or any of the Powertel Subsidiaries, as the case may be, for
consideration equal to twenty percent (20%) or more of the fair market value of
all of the outstanding shares of the Powertel capital stock on the date of this
Agreement; provided, that for purposes of this Agreement the term "Alternative
Transaction" does not include the Powertel Merger or the Powertel Merger
Agreement.
SECTION 4.04 Disclosure of Certain Matters; Delivery of Certain
Filings. Powertel shall promptly advise VoiceStream orally and in writing if
there occurs, to the knowledge of Powertel, any change or event which results in
the executive officers of Powertel having a good faith belief that such change
or event has resulted in or is reasonably likely to result in a Material Adverse
Effect on Powertel or that could reasonably be expected to prevent or materially
delay consummation of the Reorganization. VoiceStream shall promptly advise
Powertel orally and in writing if there occurs, to the knowledge of VoiceStream,
any change or event which results in the executive officers of VoiceStream
having a good faith belief that such change or event has resulted in or is
reasonably likely to result in a Material Adverse Effect on VoiceStream or that
could reasonably be expected to prevent or materially delay consummation of the
Reorganization. VoiceStream shall promptly provide to Powertel a copy of any
written notice given by VoiceStream to DT or received by VoiceStream from DT of
termination of the DT Merger Agreement. Powertel shall promptly provide to
VoiceStream, and VoiceStream shall promptly provide to Powertel, copies of all
filings made by Powertel or VoiceStream, as the case may be, with any
Governmental Entity in connection with this Agreement and the transactions
contemplated hereby and all notices and other communications and correspondence
from any Governmental Entity that relate to the Reorganization.
SECTION 4.05 Tax Status. During the period from the date of this Agreement
through the Effective Time, each of VoiceStream, Powertel and their respective
Affiliates shall use its reasonable best efforts (i) to cause the Merger to
qualify as a reorganization within the meaning of Section 368(a) of the Code and
(ii) to obtain the opinions of counsel referred to in Section 6.02(b) and
Section 6.03(b), including the execution of the tax certificates referenced
therein.
SECTION 4.06 Control of Operations. Nothing contained in this Agreement
shall give VoiceStream, directly or indirectly, the right to "control" or
"direct," as such terms are construed under applicable rules or regulations of
the FCC, Powertel's operations prior to the Effective Time. Prior to the
Effective Time, Powertel shall exercise, consistent with the terms and
conditions of this Agreement, "control" over its respective operations.
SECTION 4.07 Powertel Merger Agreement. Powertel will not modify, amend or
waive in any material respect the provisions of the Powertel Merger Agreement
without VoiceStream's prior written consent.
-27-
32
ARTICLE V
ADDITIONAL AGREEMENTS
SECTION 5.01 Employee Benefits.
(a) As of the Effective Time, Powertel will have terminated all Powertel
Benefit Plans except for those Powertel Benefit Plans that VoiceStream requests
not be terminated and those Powertel Benefit Plans described in Annex 5.18.
VoiceStream shall take all necessary action so that after the Effective Time,
any current or former employee of Powertel who is eligible to participate in a
Powertel Benefit Plan as of the Effective Time shall either be eligible to
continue his or her participation in such Powertel Benefit Plan or participate
in a corresponding employee benefit plan maintained by VoiceStream or any of its
Subsidiaries, subject to the terms of such corresponding plan. VoiceStream shall
have the sole discretion to determine which current or former employees of
Powertel will continue participation in a Powertel Benefit Plan after the
Effective Time and which will commence participation in a corresponding employee
benefit plan maintained by VoiceStream or any of its Subsidiaries after the
Effective Time and, with respect to current or former employees who transfer
participation to such a corresponding plan, when such transfer will occur.
VoiceStream need not treat all current and former employees of Powertel
(including those who are similarly situated) in the same manner with respect to
which plans they participate in and when, if at all, they transfer participation
from a Powertel Benefit Plan to a corresponding employee benefit plan maintained
by VoiceStream or any of its Subsidiaries. For example, VoiceStream may decide
to have a current or former employee of Powertel continue participation after
the Effective Time in certain Powertel Benefit Plans that have not been
terminated, and with respect to other benefits transition his participation on
or shortly after the Effective Time to a corresponding employee benefit plan
maintained by VoiceStream or one of its Subsidiaries. VoiceStream may take such
actions (or cause its Subsidiaries or the Surviving Corporation to take such
actions) as are necessary or advisable to accomplish the foregoing, including,
without limitation, amending the eligibility provisions of plans of VoiceStream,
any of its Subsidiaries or the Surviving Corporation (including, without
limitation, Powertel Benefit Plans that are not terminated on or before the
Effective Time).
(b) Except as otherwise provided in this Section 5.01, nothing in this
Agreement shall be interpreted as limiting the power of the Surviving
Corporation to amend or terminate any particular Powertel Benefit Plan or any
other particular employee benefit plan, program, agreement or policy or as
requiring the Surviving Corporation to offer to continue (other than as required
by its terms) any written employment contract or to continue the employment of
any specific person, provided, however, (1) that no such termination or
amendment may take away benefits or any other payments already accrued as of the
time of such termination or amendment without the consent of such person, except
as allowed by law, and (2) that nothing in this Section 5.01 shall be
interpreted as limiting or modifying any requirement in Section 5.18 or
provisions of Annex 5.18.
(c) VoiceStream shall, or shall cause the Surviving Corporation to, (A)
waive all limitations, to the extent allowable under applicable law, as to
preexisting conditions, exclusions and waiting periods with respect to
participation and coverage requirements applicable to the current and former
employees of Powertel and its Subsidiaries under any welfare or fringe benefit
plan in which such employees and former employees may be eligible to participate
after the Effective Time (other than a Powertel Benefit Plan that is not
terminated on or before the Effective Time), other than limitations or waiting
periods that are in effect with respect to such employees and that have not been
satisfied under the corresponding welfare or fringe benefit plan maintained by
Powertel for such current and former employees prior to the Effective Time, (B)
provide each current and former employee with credit under any welfare plans in
which such employee or former employee becomes eligible to participate after the
Effective Time for any co-payments and deductibles paid by such current or
former employee for the then current plan year under the corresponding welfare
plans maintained by Powertel prior to the Effective Time, and (C) provide (to
the extent allowed by law and Treasury regulations applicable to tax-qualified
plans) each current and former employee with full credit for purposes of
eligibility, vesting, and determination of the level of benefits under any
employee benefit plans, policies, practices or arrangements maintained by
VoiceStream or any VoiceStream Subsidiary for such current or former employee's
-28-
33
service with Powertel or any Powertel Subsidiary to the same extent recognized
by Powertel immediately prior to the Effective Time.
(d) Except as expressly contemplated under Section 5.02 of this Agreement,
neither Powertel nor any affiliate thereof shall, from the date hereof until the
Effective Time, without the prior express written consent of VoiceStream, make
any contribution, sale or other transfer of Powertel Stock or any other
"employer security" (as such term is defined in Section 407 of ERISA), whether
to satisfy a required obligation, to reimburse for expenses incurred, or
otherwise, to any Powertel Benefit Plan or to the Powertel stock fund (or any
other fund) under the Powertel 401(k) Profit Sharing Plan. Moreover, Powertel
shall, promptly after the date hereof, amend the Powertel 401(k) Profit Sharing
Plan (as amended and restated effective as of January 1, 1998, and further
amended August 23, 1999), (a) to require that all contributions, from whatever
source, be made in the form of cash and (b) to preclude the use of any present
or future Powertel 401(k) Profit Sharing Plan assets to purchase from Powertel
or any affiliate thereof shares of Powertel Stock or other "employer securities"
(as such term is defined in Section 407 of ERISA); it being understood, however,
that such amendment need not preclude the Powertel 401(k) Profit Sharing Plan
from purchasing Powertel Stock on the open market from any person or entity
other than Powertel or an affiliate thereof, nor require that shares of Powertel
Stock and units in the Powertel stock fund presently under the Powertel 401(k)
Profit Sharing Plan be sold or otherwise liquidated.
SECTION 5.02 Options; Restricted Stock Awards.
(a) Prior to the Effective Time, the Board of Directors of Powertel (or the
Stock Option Compensation Committee of the Board of Directors) shall adopt such
resolutions or shall take such other actions as may be required, with respect to
Powertel Stock Options and the Powertel Restricted Stock Plan, to specifically
approve the transactions contemplated by this Section 5.02.
(b) At the Effective Time, each Powertel Stock Option which is outstanding
immediately prior to the Effective Time pursuant to any Powertel Stock Plan
shall become and represent an option to purchase the number of shares of
VoiceStream Common Stock (a "Substitute Option") determined by multiplying the
number of shares of Powertel Common Stock subject to such Powertel Stock Option
immediately prior to the Effective Time by the Conversion Number, at an exercise
price per share of VoiceStream Common Stock (increased to the nearest whole
cent) equal to the exercise price per share of Powertel Common Stock subject to
such Powertel Stock Option immediately prior to the Effective Time divided by
the Conversion Number; provided, however, that in the case of any Powertel Stock
Option to which Section 421 of the Code applies by reason of its qualification
under Section 422 of the Code ("incentive stock options"), the option price, the
number of shares purchasable pursuant to such option and the terms and
conditions of exercise of such option shall be determined in order to comply
with Section 424(a) of the Code. The parties intend that the assumption of
incentive stock options provided for under this Section 5.02 shall meet the
requirements of Section 424(a) of the Code, and this Section 5.02 shall be
interpreted in a manner consistent with such intent. All other terms and
conditions applicable to the Powertel Stock Options, including vesting, shall
remain unchanged with respect to the Substitute Options (except to the extent
that such terms and conditions may be altered in accordance with the applicable
Powertel Stock Option Plan or stock option agreements related thereto). No
fractional shares of VoiceStream Common Stock will be issued upon the exercise
of Substitute Options. In lieu of such issuance, the shares of VoiceStream
Common Stock issued pursuant to the terms of this Agreement shall be rounded to
the closest whole share of VoiceStream Common Stock. After the Effective Time,
except as otherwise provided in this Section 5.02, each Substitute Option shall
be exercisable upon the same terms and conditions as were applicable to the
related Powertel Stock Option immediately prior to the Effective Time, after
giving effect to the resolutions and other actions described in this Section
5.02. Not later than the Effective Time, VoiceStream shall file a registration
statement on Form S-8 with respect to or otherwise include in an existing
registration statement the shares of VoiceStream Common Stock to be issued upon
exercise of the Substitute Options and shall use its reasonable best efforts to
maintain the effectiveness of such registration statement for so long as the
Substitute Options shall remain outstanding.
-29-
34
(c) At the Effective Time, the Powertel Restricted Stock Plan shall
terminate and any unvested Powertel Restricted Stock Awards shall become fully
vested, except as otherwise provided in the applicable agreements relating to
such Powertel Restricted Stock Awards.
SECTION 5.03 Stockholders Meetings.
(a) As promptly as practicable after the Registration Statement is declared
effective under the Securities Act, Powertel shall duly give notice of, convene
and hold a meeting of its stockholders (the "Powertel Stockholders Meeting") in
accordance with Delaware law for the purpose of obtaining the Powertel
Stockholder Approval and shall, subject to the provisions of Section 5.03(d)
hereof, through its Board of Directors, recommend to its stockholders the
approval and adoption of this Agreement, the Merger and the other transactions
contemplated hereby and shall use its reasonable best efforts to obtain the
Powertel Stockholder Approval.
(b) As promptly as practicable after the Registration Statement is declared
effective under the Securities Act, VoiceStream shall duly give notice of,
convene and hold a meeting of its stockholders (the "VoiceStream Stockholders
Meeting") in accordance with the DGCL for the purpose obtaining the VoiceStream
Stockholder Approval and shall, through its Board of Directors, recommend to its
stockholders the approval and adoption of this Agreement and shall use its
reasonable best efforts to obtain the VoiceStream Stockholder Approval.
(c) Powertel and VoiceStream shall coordinate and cooperate with respect to
the timing of the Stockholder Meetings and shall use their reasonable best
efforts to hold such meetings on the same day.
(d) Neither the Board of Directors of Powertel nor any committee thereof
shall (i) except as expressly permitted by this Section 5.03(d), withdraw,
qualify or modify, or propose publicly to withdraw, qualify or modify, in a
manner adverse to VoiceStream, the approval or recommendation of such Board of
Directors or such committee of this Agreement, the Merger and the other
transactions contemplated hereby, (ii) approve or recommend, or propose publicly
to approve or recommend, any Alternative Transaction, or (iii) cause Powertel to
enter into any letter of intent, agreement in principle, acquisition agreement
or other similar agreement related to any Alternative Transaction.
Notwithstanding the foregoing, in the event that prior to the time the Powertel
Stockholder Approval is obtained, Powertel receives a Superior Proposal (as
defined below), the Board of Directors of Powertel may (subject to this and the
following sentences) inform the Powertel stockholders that it no longer
recommends adoption and approval of this Agreement by the Powertel's
stockholders (a "Subsequent Determination"), but only at a time that is after
the fifth Business Day following VoiceStream's receipt of written notice
advising VoiceStream that the Board of Directors of Powertel has received a
Superior Proposal specifying the material terms and conditions of such Superior
Proposal (and including a copy or draft copy thereof with all accompanying
documentation or draft documentation, if in writing), identifying the Person
making such Superior Proposal and stating that it intends to make a Subsequent
Determination. After providing such notice, Powertel shall provide a reasonable
opportunity to VoiceStream to make such adjustments in the terms and conditions
of this Agreement as would enable Powertel to proceed with its recommendation to
its stockholders without a Subsequent Determination; provided, however, that any
such adjustment shall be at the discretion of Powertel and VoiceStream at the
time. For purposes of this Agreement, a "Superior Proposal" means any proposal
(on its most recently amended or modified terms, if amended or modified) made by
a Third Party to enter into an Alternative Transaction which the Board of
Directors of Powertel determines in its good faith judgment (based on, among
other things, the advice of a financial advisor of nationally recognized
reputation) to be more favorable to the Powertel's stockholders than the
transactions contemplated by this Agreement taking into account all relevant
factors (including whether, in the good faith judgment of the Board of Directors
of Powertel, after obtaining the advice of a financial advisor of nationally
recognized reputation, the Third Party is reasonably able to finance the
transaction, and any proposed changes to this Agreement that may be proposed by
VoiceStream in response to such Alternative Transaction). Powertel shall submit
this Agreement to its stockholders at the Powertel Stockholders Meeting even if
the Board of Directors of Powertel shall have made a Subsequent Determination.
-30-
35
SECTION 5.04 Preparation of the Registration Statement and Joint Proxy
Statement. As promptly as reasonably practicable following the date of this
Agreement, Powertel and VoiceStream shall prepare and file with the SEC the
Joint Proxy Statement and VoiceStream shall prepare and file with the SEC the
Registration Statement, in which the Joint Proxy Statement will be included as a
prospectus. VoiceStream shall use its reasonable best efforts, with the
cooperation and assistance of Powertel, to have the Registration Statement
declared effective under the Securities Act as promptly as practicable after
such filing and to keep the Registration Statement effective as long as is
necessary to consummate the Reorganization and the transactions contemplated in
connection therewith. VoiceStream shall also take any reasonable action (other
than qualifying to do business in any jurisdiction in which it is now not so
qualified) required to be taken under any applicable state securities laws in
connection with the issuance of VoiceStream Common Stock, in connection with the
Reorganization and upon any exercise of the Substitute Options. Powertel shall
furnish all information concerning Powertel and the holders of shares of
Powertel Stock as may be reasonably requested by VoiceStream in connection with
any such action. VoiceStream shall notify Powertel promptly of the receipt of
any comments from the SEC or its staff and of any request by the SEC or its
staff for amendments or supplements to the Registration Statement or the Joint
Proxy Statement or for additional information and will supply Powertel with
copies of all correspondence between VoiceStream or any of its representatives,
on the one hand, and the SEC or its staff, on the other hand, with respect to
the Registration Statement, the Joint Proxy Statement or the Reorganization. If
at any time prior to the Powertel Stockholders Meeting or the VoiceStream
Stockholders Meeting there shall occur any event that should be set forth in an
amendment or supplement to the Registration Statement or the Joint Proxy
Statement, each of VoiceStream and Powertel shall promptly prepare and mail to
the stockholders of Powertel and VoiceStream such an amendment or supplement.
VoiceStream and Powertel shall cooperate with one another and with DT in the
preparation of the Registration Statement, the DT Registration Statement, the
Joint Proxy Statement or any amendment or supplement thereto and in having the
Registration Statement, the DT Registration Statement and the Joint Proxy
Statement declared effective as soon as practicable.
SECTION 5.05 Notification of Receipt of Proxy.
(a) Promptly upon receipt by Powertel from any Powertel stockholder who is
a party to the Powertel Stockholder Agreement of a proxy card sent to the
Powertel stockholders with the Joint Proxy Statement and in accordance with the
Powertel Stockholder Agreement, but in no event later than the second Business
Day following such receipt or, if such receipt is on or after the fifth Business
Day prior to the Closing, then on the date of such receipt, Powertel shall
notify VoiceStream orally of its receipt and provide VoiceStream with a copy of
such proxy card.
(b) Promptly upon receipt by VoiceStream from any VoiceStream stockholder
who is a party to a VoiceStream Stockholder Agreement of a proxy card sent to
the VoiceStream Stockholders with the Joint Proxy Statement and in accordance
with such VoiceStream Stockholder Agreement, but in no event later than the
second Business Day following such receipt or, if such receipt is on or after
the fifth Business Day prior to the Closing, then on such date of receipt,
VoiceStream shall notify Powertel orally of its receipt and provide Powertel
with a copy of such proxy card.
SECTION 5.06 Comfort Letters.
(a) Powertel shall have received a "comfort" letter of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ LLP,
Powertel's independent public accountants, dated a date within two (2) business
days prior to the date of the first mailing of the Joint Proxy Statement,
addressed to Powertel, in form and substance reasonably satisfactory to Powertel
and as is reasonably customary in scope and substance for letters delivered by
independent public accountants in connection with registration statements on
Form S-4 with respect to the financial statements of VoiceStream included in the
Joint Proxy Statement and the Registration Statement.
(b) VoiceStream shall have received a "comfort" letter of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
LLP, VoiceStream's independent public accountants, dated a date within two (2)
business days prior to the date of the first mailing of the Joint Proxy
Statement, addressed to VoiceStream, in form and substance reasonably
satisfactory to VoiceStream and as is reasonably customary in scope and
substance for letters delivered by independent
-31-
36
public accountants in connection with registration statements on Form S-4 with
respect to the financial statements of Powertel included in the Joint Proxy
Statement and the Registration Statement.
SECTION 5.07 Access to Information. Upon reasonable notice and subject to
restrictions contained in the Confidentiality Agreement and other
confidentiality agreements to which Powertel is subject, (a) Powertel shall, and
shall cause each Powertel Subsidiary to, afford to VoiceStream and to the
officers, employees, accountants, counsel and other representatives of
VoiceStream all reasonable access, during normal business hours during the
period prior to the Effective Time, to all their respective lenders, agents and
other representatives, properties, assets, books, contracts, commitments and
records and, during such period, Powertel shall (and shall cause each Powertel
Subsidiary to) furnish promptly to VoiceStream all information concerning its
business, properties and personnel as VoiceStream may reasonably request,
including a copy of each report, schedule, registration statement and other
document filed or received by it during such period pursuant to the requirements
of the federal or state securities laws or the federal Tax laws and (b)
VoiceStream shall, and shall cause each VoiceStream Subsidiary to, afford to
Powertel and to the officers, employees, accountants, counsel and other
representatives of Powertel all reasonable access, during normal business hours
during the period prior to the Effective Time, to all their respective
properties, assets, books, contracts, commitments and records and, during such
period, VoiceStream shall (and shall cause each VoiceStream Subsidiary to)
furnish promptly to Powertel all information concerning its business, properties
and personnel as Powertel may reasonably request, including a copy of each
report, schedule, registration statement and other document filed or received by
it during such period pursuant to the requirements of the federal or state
securities laws.
SECTION 5.08 Compliance with the Securities Act.
(a) No later than thirty (30) days following the date of this Agreement,
Powertel shall cause to be prepared and delivered to VoiceStream a list
identifying all persons who, at the time of the Powertel Stockholders Meeting,
may be deemed to be an "affiliate" of Powertel, as such term is used in
paragraphs (c) and (d) of Rule 145 under the Securities Act (the "Rule 145
Affiliates"). Powertel shall use reasonable efforts to cause each person who is
identified as a Rule 145 Affiliate in such list to deliver to VoiceStream on or
prior to the Effective Time a written agreement, in the form attached hereto as
Annex C, that such Rule 145 Affiliate shall not sell, pledge, transfer or
otherwise dispose of any shares of VoiceStream Common Stock issued to such Rule
145 Affiliate in connection with the Reorganization, except pursuant to an
effective registration statement or in compliance with such Rule 145 or another
exemption from the registration requirements of the Securities Act.
(b) Prior to the Effective Time, the Board of Directors of VoiceStream (or
the committee of the Board of Directors of VoiceStream composed solely of two
(2) or more "Non-Employee Directors," as that term is defined in Rule
16b-3(b)(3)(i) under the Exchange Act, administering the stock plans of
VoiceStream) shall adopt such resolutions or shall take such other actions as
are required to specifically approve the acquisitions of VoiceStream Common
Stock and Substitute Options at the Effective Time, as contemplated by Sections
1.06(c) and 5.02, by directors, officers or employees of Powertel who may become
directors or officers of VoiceStream, such approvals to be given for the purpose
of exempting such acquisitions under Rule 16b-3 under the Exchange Act, it being
acknowledged that such approvals shall not adversely affect VoiceStream's
ability subsequently to determine that any such person has not in fact become a
director or officer of VoiceStream.
SECTION 5.09 Nasdaq Listings. VoiceStream shall use reasonable best
efforts to be included on Nasdaq, upon notification of issuance, the shares of
VoiceStream Common Stock to be issued in connection with the Reorganization and
upon any exercise of the Substitute Options.
SECTION 5.10 Fees and Expenses.
(a) Except as provided below in this Section 5.10 or Section 5.14, all fees
and expenses incurred in connection with the Reorganization, this Agreement and
the transactions contemplated hereby shall be paid by the party incurring such
fees or expenses, whether or not the Reorganization is consummated, except that
the costs and expenses, other than attorneys' fees, incurred in connection with
(i) the printing and mailing of
-32-
37
the Joint Proxy Statement with respect to the Reorganization, the DT Merger and
the Powertel Merger, the Registration Statement, the DT Registration Statement
and the Powertel Registration Statement (and any amendment or supplement
thereto) and any prospectus included in such registration statements (and any
amendment or supplement thereto) shall be borne one-third by VoiceStream,
one-third by DT and one-third by Powertel, and (ii) any filing fees (including
fees payable to the SEC and state regulatory authorities) with respect to the
Joint Proxy Statement and the Registration Statement shall be borne one-half by
VoiceStream and one-half by Powertel.
(b) In the event that VoiceStream terminates this Agreement pursuant to
Section 7.01(c)(i), Section 7.01(c)(ii) or Section 7.01(e)(ii) or Powertel
terminates this Agreement pursuant to Section 7.01(d)(ii), Powertel shall pay,
or cause to be paid, in same day funds to VoiceStream within one (1) Business
Day of such termination, $150,000,000 plus expenses not to exceed $10,000,000
(the "Termination Fee"); provided that, in the event a termination fee is also
payable by Powertel in connection with the termination of the Powertel Merger
Agreement, Powertel shall pay each of DT and VoiceStream $75,000,000, plus
expenses not to exceed $10,000,000 in the aggregate.
(c) In the event that Powertel terminates this Agreement pursuant to
Section 7.01(d)(i), Section 7.01(d)(iii) or Section 7.01(e)(i), VoiceStream
shall pay, or cause to be paid, the Termination Fee to Powertel in same day
funds within one (1) Business Day following such termination of this Agreement.
(d) Powertel and VoiceStream agree that the agreements contained in Section
5.10(b) and Section 5.10(c) above are an integral part of the transactions
contemplated by this Agreement and are an inducement to VoiceStream and Powertel
to enter into this Agreement. If Powertel fails to promptly pay to VoiceStream
any fee due under such Section 5.10(b), or if VoiceStream fails to promptly pay
Powertel any fee due under Section 5.10(c), then the non-paying party shall pay
the costs and expenses (including legal fees and expenses) of the other party in
connection with any action, including the filing of any lawsuit or other legal
action, taken to collect payment, together with interest on the amount of any
unpaid fee at the publicly announced prime rate of Citibank, N.A., from the date
such fee was required to be paid.
SECTION 5.11 Public Announcements. VoiceStream and Powertel will consult
with each other and with DT before issuing any press release with respect to the
transactions contemplated by this Agreement and shall not issue any such press
release prior to such consultation, except as may be required by applicable law,
fiduciary duties or by obligations pursuant to any listing agreement with any
national securities exchange. The parties will cooperate in preparing a joint
press release announcing the execution of this Agreement.
SECTION 5.12 State Takeover Laws. If any "fair price" or "control share
acquisition" statute or other similar statute or regulation shall become
applicable to the transactions contemplated hereby, VoiceStream and Powertel and
their respective Boards of Directors shall use reasonable best efforts to grant
such approvals and take such actions as are necessary so that the transactions
contemplated hereby may be consummated as promptly as practicable on the terms
contemplated hereby and otherwise act to minimize the effects of any such
statute or regulation on the transactions contemplated hereby.
SECTION 5.13 Indemnification; Directors and Officers Insurance.
(a) VoiceStream shall, or shall cause the Surviving Corporation to,
continue to provide, fulfill and honor all rights to indemnification or
exculpation existing in favor of a director, officer, employee or agent (an
"Indemnified Person") of Powertel or any of the Powertel Subsidiaries (including
rights relating to advancement of expenses and indemnification rights to which
such persons are entitled because they are serving as a director, officer, agent
or employee of another entity at the request of Powertel or any of the Powertel
Subsidiaries), as provided in the Restated Certificate of Incorporation of
Powertel, the Restated By-laws of Powertel or any indemnification agreement, in
each case, as in effect on the date of this Agreement, and relating to actions
or events through the Effective Time, and such rights to indemnification shall
survive the Reorganization and shall continue in full force and effect, without
any amendment thereto; provided, however, that neither VoiceStream nor the
Surviving Corporation shall be required to indemnify any Indemnified Person in
connection with any proceeding (or portion thereof) to the extent involving any
claim initiated by such Indemnified Person unless the initiation of such
proceeding (or portion thereof) was
-33-
38
authorized by the Board of Directors of Powertel or unless such proceeding is
brought by an Indemnified Person to enforce rights under this Section 5.13;
provided further that any determination required to be made with respect to
whether an Indemnified Person's conduct complies with the standards set forth
under the DGCL, the Restated Certificate of Incorporation of Powertel, the
Restated By-laws of Powertel or any such agreement, as the case may be, shall be
made by independent legal counsel selected by VoiceStream and reasonably
acceptable to such Indemnified Person; provided further that VoiceStream and the
Surviving Corporation will cooperate and use all reasonable efforts to assist in
the vigorous defense of any such matter; and provided further that that nothing
in this Section 5.13 shall impair any rights of any Indemnified Person. Without
limiting the generality of the preceding sentence, in the event that any
Indemnified Person becomes involved in any actual or threatened action, suit,
claim, proceeding or investigation after the Effective Time relating to actions
prior to the Effective Time, VoiceStream shall, or shall cause the Surviving
Corporation to, promptly advance to such Indemnified Person his or her legal and
other expenses (including the cost of any investigation and preparation incurred
in connection therewith), subject to the providing by such Indemnified Person,
to the extent required by law, of an undertaking to reimburse all amounts so
advanced in the event of a non-appealable determination of a court of competent
jurisdiction that such Indemnified Person is not entitled thereto.
(b) Subject to the prior written approval by VoiceStream, which shall not
be unreasonably withheld, prior to the Effective Time, Powertel shall have the
right to obtain and pay for in full a "tail" coverage directors' and officers'
liability insurance policy ("D&O Insurance") covering a period of six (6) years
after the Effective Time and providing coverage in amounts and on terms
consistent with Powertel's existing D&O Insurance. In the event Powertel does
not obtain such insurance, VoiceStream shall cause the Surviving Corporation to
continue to provide D&O Insurance relating to actions or events through the
Effective Time, for a period of six (6) years after the Effective Time;
provided, that the Surviving Corporation may substitute therefor policies of
substantially similar coverage and amounts containing terms no less advantageous
to such former directors or officers; provided further that if the existing D&O
Insurance expires or is cancelled during such period, VoiceStream or the
Surviving Corporation shall make reasonable commercial efforts to obtain
substantially similar D&O Insurance; and provided further that Powertel shall
not be required to expend, in order to maintain or procure an annual D&O
Insurance policy, an amount in excess of 250% of the last annual premium paid
prior to the date hereof, but in such case shall purchase as much coverage as
possible for such amount.
(c) In the event VoiceStream or the Surviving Corporation or any of their
respective successors or assigns (i) consolidates with or merges into any other
Person and shall not be the continuing or surviving corporation or entity of
such consolidation or merger or (ii) transfers all or substantially all of its
properties and assets to any Person in a single transaction or a series of
related transactions, then, and in each such case, VoiceStream will make or
cause to be made proper provision so that the successors and assigns of
VoiceStream or the Surviving Corporation, as the case may be, assume the
indemnification obligations described herein for the benefit of the Indemnified
Parties.
(d) The provisions of this Section 5.13 are intended to be for the benefit
of, and shall be enforceable by, each Indemnified Person, his or her heirs and
his or her personal representatives and shall survive the Reorganization and be
binding upon the successors and assigns of VoiceStream, Powertel and the
Surviving Corporation.
SECTION 5.14 Reasonable Best Efforts.
(a) Subject to the provisions of this Agreement, each of Powertel and
VoiceStream agrees to use its reasonable best efforts to take, or cause to be
taken, all actions, and do, or cause to be done, and to assist and cooperate
with the other party or parties in doing, all things necessary, proper or
advisable, to consummate and make effective, in the most expeditious manner
practicable, the Reorganization and the other transactions contemplated by this
Agreement; provided, however, that neither VoiceStream nor any of the
VoiceStream Subsidiaries shall be required, nor, without the consent of
VoiceStream, shall Powertel or the Powertel Subsidiaries be permitted, to divest
or hold separate or otherwise take or commit to take any action that limits its
freedom of action with respect to Powertel, VoiceStream or any of their
respective Subsidiaries or any
-34-
39
material portion of the assets of Powertel, VoiceStream or any of their
respective Subsidiaries or any of the business, product lines, or assets of
Powertel, VoiceStream or any of their respective Subsidiaries. Without limiting
the foregoing, (i) each of Powertel and VoiceStream agrees to use its reasonable
best efforts to take, or cause to be taken, all actions necessary to comply
promptly with all legal requirements that may be imposed on itself or its
Subsidiaries with respect to the Reorganization (which actions shall include
furnishing all information required under the HSR Act and all actions required
in connection with approvals of or filings with the FCC, state public utility or
service commissions or similar agencies and any other Governmental Entity) and
shall promptly cooperate with and furnish information to each other in
connection with any such requirements imposed upon any of them or any of their
Subsidiaries in connection with the Reorganization, (ii) each of Powertel and
VoiceStream shall, and shall cause its Subsidiaries to, use its reasonable best
efforts to obtain (and shall cooperate with each other in obtaining) any
consent, authorization, order or approval of, or any exemption by, the FCC,
state public utility or service commissions or similar agencies and any other
Governmental Entity or other public or private third party required to be
obtained or made by VoiceStream, Powertel or any of their Subsidiaries in
connection with the Reorganization or the taking of any action contemplated
thereby or by this Agreement, (iii) VoiceStream shall maintain Sub as a
wholly-owned VoiceStream Subsidiary, with no voting or approval rights
outstanding other than those held by VoiceStream, and VoiceStream shall cause
Sub to approve, and shall vote all securities and give all approvals necessary
for Sub to approve, the Reorganization, and (iv) each party will use its
reasonable best efforts to oppose entry or lift the effects of any injunction or
other order adversely affecting the ability of any party hereto to consummate
the transactions contemplated hereby to prevent, with respect to any threatened
or such injunction or other order, the issuance or entry thereto, provided
however, that notwithstanding anything to the contrary contained in this
Agreement, in connection with any filing or submission required or action to be
taken by VoiceStream, Powertel or any of their respective Subsidiaries to
consummate the Reorganization or the other transactions contemplated in this
Agreement, Powertel shall not, without VoiceStream's prior written consent,
commit to any divestiture of assets or businesses of Powertel and the Powertel
Subsidiaries if such divested assets and/or businesses are material to the
assets or profitability of Powertel and the Powertel Subsidiaries taken as a
whole.
(b) As promptly as practicable after the execution and delivery of this
Agreement, VoiceStream and Powertel shall prepare all appropriate applications
for FCC approval, and such other documents as may be required, with respect to
the transfer of control of Powertel to VoiceStream (collectively, the "FCC
Applications"). Not later than the tenth Business Day following execution and
delivery of this Agreement, Powertel and VoiceStream will exchange with each
other their respective completed portions of the FCC Applications. Not later
than the fifteenth Business Day following the execution and delivery of this
Agreement, Powertel and VoiceStream shall file, or cause to be filed, the FCC
Applications. If the Effective Time shall not have occurred for any reason
within any applicable initial consummation period, and neither Powertel nor
VoiceStream shall have terminated this Agreement pursuant to Section 7.01,
VoiceStream and Powertel shall jointly request one or more extensions of the
consummation period of such grant. No party hereto shall knowingly take, or fail
to take, any action if the intent or reasonably anticipated consequence of such
action or failure to act is, or would be, to cause the FCC not to grant approval
of the FCC Applications or delay either such approval or the consummation of the
transfer of control of Powertel. VoiceStream and Powertel shall each pay
one-half ( 1/2) of any FCC fees, if applicable, in connection with the filing or
granting of approval of the FCC Applications. Each of VoiceStream and Powertel
shall bear its own expenses in connection with the preparation and prosecution
of the FCC Applications. VoiceStream and Powertel shall each use all
commercially reasonable efforts to prosecute the FCC Applications in good faith
and with due diligence before the FCC and in connection therewith shall take
such action or actions as may be necessary or reasonably required in connection
with the FCC Applications, including furnishing to the FCC any documents,
materials or other information requested by the FCC in order to obtain such FCC
approval as expeditiously as practicable.
(c) Promptly after the date hereof, VoiceStream and Powertel (as may be
required pursuant to the HSR Act) will complete all documents required to be
filed with the Federal Trade Commission and the Department of Justice in order
to comply with the HSR Act and, not later than twenty (20) Business Days after
the date hereof, together with the Persons who are required to join in such
filings, shall file the same with
-35-
40
the appropriate Governmental Entities. VoiceStream and Powertel shall each pay
one-half ( 1/2) of any fees that may be payable in connection with the filing
pursuant to the HSR Act. VoiceStream and Powertel shall promptly furnish all
materials thereafter required by any of the Governmental Entities having
jurisdiction over such filings and shall take all reasonable actions and shall
file and use all reasonable efforts to have declared effective or approved all
documents and notifications with any such Governmental Entities, as may be
required under the HSR Act or other federal antitrust laws for the consummation
of the Transactions and any other transactions contemplated hereby.
(d) Each of Powertel and VoiceStream shall promptly notify the other of:
(i) any notice or other communication from any Person alleging that
the consent of such Person is or may be required in connection with the
transactions contemplated by this Agreement;
(ii) any notice or other communication from or to any Governmental
Entity in connection with the transactions contemplated by this Agreement;
(iii) the occurrence, or non-occurrence, of any event the occurrence
or non-occurrence of which would reasonably be expected to cause any
representation or warranty made by it and contained herein to be untrue or
inaccurate in any material respect at any time during the period commencing
on the date hereof and ending at the Effective Time;
(iv) any failure of such party to comply with or satisfy any covenant,
condition or agreement to be complied with or satisfied by it hereunder;
provided, however, that the delivery of any notice pursuant to this Section
5.14(d) shall not limit or otherwise affect the remedies available
hereunder to the party receiving such notice;
(v) any actions, suits, claims, investigations or proceedings
commenced or, to its knowledge threatened against such party which, if
pending on the date of this Agreement, would have been required to have
been disclosed pursuant to Section 2.13, in the case of Powertel, or
Section 3.12, in the case of VoiceStream, or which relate to the
consummation of the Transactions; and
(vi) any event, condition or state of facts which could have a
Material Adverse Effect on such party.
SECTION 5.15 Certain Litigation. Powertel agrees that it shall not settle
any litigation commenced after the date hereof against Powertel or any of its
directors by any stockholder of Powertel relating to the Reorganization, this
Agreement or the Powertel Stockholder Agreement without the prior written
consent of VoiceStream, which consent shall not be unreasonably withheld or
delayed.
SECTION 5.16 Powertel Stockholder Agreement and VoiceStream Stockholder
Agreement. VoiceStream and each of the Powertel Principal Stockholders shall
enter into a Powertel Stockholder Agreement as of the date hereof. Powertel and
each of the VoiceStream Principal Stockholders shall enter into a VoiceStream
Stockholder Agreement as of the date hereof.
SECTION 5.17 Senior Discount Notes and Senior Notes. Within thirty (30)
days following the Effective Time, VoiceStream shall cause the Surviving
Corporation to commence an offer to purchase all of the Senior Discount Notes
and Senior Notes (collectively, the "Notes") pursuant to the terms of the
February 1996 Indenture, April 1996 Indenture and June 1997 Indenture
(collectively, the "Powertel Indentures"), as applicable. Any investment banking
firm engaged in connection with such acquisition shall be selected by
VoiceStream. VoiceStream shall bear the fees, costs and expenses of acquiring
the Notes.
SECTION 5.18 Plans and Programs to be Implemented. After the execution of
this Agreement, Powertel and/or its Subsidiaries shall adopt and implement the
plans and arrangements described in Annex 5.18 with each such plan and
arrangement being approved by VoiceStream or DT prior to such adoption or
implementation. Each such plan or arrangement shall be designed to become
effective as of the Effective Time (contingent upon the occurrence of the
transactions contemplated by this Agreement), and remain effective without
modification of the terms and provisions of such plan or arrangement until the
termination date noted for each respective plan or arrangement in Annex 5.18.
After the execution of this Agreement, Powertel and/or its Subsidiaries shall
take such actions as are required, necessary or appropriate
-36-
41
to implement the provisions of Annex 5.18 and this Section 5.18 notwithstanding
any provisions of this Agreement to the contrary, and no such actions shall be
deemed to be a breach of any other provision of this Agreement.
SECTION 5.19 Registration Rights. Powertel Principal Stockholders shall
have registration rights as set forth in Annex A to their respective Powertel
Stockholder Agreements.
ARTICLE VI
CONDITIONS PRECEDENT
SECTION 6.01 Conditions to Each Party's Obligation to Effect the
Reorganization. The respective obligations of VoiceStream and Powertel to effect
the Reorganization shall be subject to the fulfillment or (to the extent
permitted by applicable law) written waiver prior to the Effective Time of the
following conditions:
(a) Stockholder Approval. The Powertel Stockholder Approval shall have been
obtained.
(b) No Injunction or Restraint. No statute, rule, regulation, executive
order, decree, temporary restraining order, preliminary or permanent injunction
or other order issued by any court of competent jurisdiction or other
Governmental Entity preventing the consummation of the Reorganization or which
could reasonably be expected to have a Material Adverse Effect on Powertel shall
be in effect.
(c) Nasdaq Listings. The shares of VoiceStream Common Stock issuable in
accordance with the Reorganization and pursuant to Section 5.02 shall have been
authorized for listing on the Nasdaq, subject to official notice of issuance.
(d) HSR. Any waiting period (and any extension thereof) under the HSR Act
applicable to the Reorganization shall have expired or been terminated.
(e) Registration Statement. The Registration Statement shall have become
effective in accordance with the provisions of the Securities Act. No stop order
suspending the effectiveness of the Registration Statement or the Joint Proxy
Statement shall have been issued by the SEC and no proceedings for that purpose
shall have been initiated or, to the knowledge of VoiceStream or Powertel,
threatened by the SEC. All necessary state securities authorizations (including
state takeover approvals) shall have been received unless the failure to receive
any such authorization would not have a Material Adverse Effect on Powertel or
VoiceStream or the transactions contemplated by this Agreement.
(f) Termination of Other Merger Agreements. The DT Merger Agreement and the
Powertel Merger Agreement shall have terminated in accordance with their
respective terms.
SECTION 6.02 Additional Conditions to Obligation of Powertel to Effect the
Reorganization. The obligation of Powertel to effect the Reorganization shall be
subject to the fulfillment or written waiver by Powertel at or prior to the
Effective Time of the following additional conditions:
(a) Performance of Obligations; Representations and Warranties. VoiceStream
shall have performed in all material respects each of its agreements contained
in this Agreement required to be performed at or prior to the Effective Time,
and each of the representations and warranties of VoiceStream contained in this
Agreement shall be true and correct at and as of the Effective Time as if made
at and as of the Effective Time (other than representations and warranties which
address matters only as of a particular date, in which case such representations
and warranties shall be true and correct on and as of such particular date) in
each case except as contemplated or permitted by this Agreement and except as
would not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect on VoiceStream or the transactions contemplated by this
Agreement; provided, however, for purposes of this Section 6.02(a), the
representations and warranties of VoiceStream shall be construed as if they did
not contain any qualification that refers to Material Adverse Effect or
materiality; and Powertel shall have received a certificate signed on behalf of
VoiceStream by a duly authorized officer to such effect.
-37-
42
(b) Tax Opinion. Powertel shall have received an opinion of ▇▇▇▇▇▇, ▇▇▇▇▇▇▇
& ▇▇▇▇▇▇, LLP, in form and substance reasonably satisfactory to Powertel, dated
the Closing Date, substantially to the effect that, on the basis of facts,
representations and assumptions set forth in such opinion which are consistent
with the state of facts existing as of the Effective Time, the Merger will
constitute a reorganization within the meaning of Section 368(a) of the Code for
federal income tax purposes.
In rendering such opinion, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇, LLP, may receive and
rely upon representations from others, including representations from (i)
Powertel and (ii) VoiceStream contained in certificates substantially in the
form of the Powertel Tax Certificate and the VoiceStream Tax Certificate
attached hereto as Annex F and Annex G, respectively. Each such certificate
shall be dated on or before the date of such opinion and shall not have been
withdrawn or modified in any material respect.
(c) Consents Under Agreements. VoiceStream shall have obtained the consent
or approval of each person whose consent or approval shall be required to
consummate the transactions contemplated hereby under any indenture, mortgage,
evidence of indebtedness, lease or other agreement or instrument to which
VoiceStream or any of the VoiceStream Subsidiaries is a party, except where the
failure to obtain the same would not reasonably be expected, individually or in
the aggregate, to have a Material Adverse Effect on VoiceStream or upon the
transactions contemplated by this Agreement.
(d) FCC Opinion. Powertel shall have received an opinion of FCC counsel to
VoiceStream, dated the Effective Time, substantially in the form attached hereto
as Annex D.
(e) [Reserved]
(f) Governmental Approvals. All necessary consents or authorizations from
Governmental Entities which may be required in connection with the transactions
contemplated hereby, shall have been received, unless the failure to receive any
such consent or authorization would not have a Material Adverse Effect on
VoiceStream or the transactions contemplated by this Agreement, and such
consents or authorizations shall not contain any conditions which would
reasonably be expected to have a Material Adverse Effect on VoiceStream or the
transactions contemplated by this Agreement. With respect to any FCC consents or
authorizations, effectiveness of necessary FCC approvals shall be sufficient to
satisfy this condition, and Powertel's obligation to effect the Reorganization
shall not be subject to the condition that any FCC consents or authorizations
have become Final Orders.
Notwithstanding anything contained to the contrary in Section 6.02(a) or
anywhere else in this Agreement, VoiceStream may enter into any Subsequent
Transaction, and no changes of any representation or warranty of VoiceStream
contained in this Agreement as a result of any Subsequent Transaction shall
result in a failure of the conditions set forth in Section 6.02(a); provided, in
each case, that any such Subsequent Transaction would not reasonably be expected
to have a Material Adverse Effect on VoiceStream.
SECTION 6.03 Conditions to Obligations of VoiceStream to Effect the
Reorganization. The obligation of VoiceStream to effect the Reorganization shall
be subject to the fulfillment or written waiver by VoiceStream at or prior to
the Effective Time of the following additional conditions:
(a) Performance of Obligations; Representations and Warranties. Powertel
shall have performed in all material respects each of its agreements contained
in this Agreement required to be performed at or prior to the Effective Time,
and each of the representations and warranties of Powertel contained in this
Agreement shall be true and correct at and as of the Effective Time as if made
at and as of the Effective Time (other than representations and warranties which
address matters only as of a particular date, in which case such representations
and warranties shall be true and correct on and as of such particular date), in
each case except as contemplated or permitted by this Agreement and except as
would not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect on Powertel or VoiceStream or the transactions
contemplated by this Agreement; provided, however, for purposes of this Section
6.03(a), the representations and warranties of Powertel shall be construed as if
they did not contain any qualification that refers to Material Adverse Effect or
materiality; and VoiceStream shall have received a certificate signed on behalf
of Powertel by a duly authorized officer to such effect.
-38-
43
(b) Tax Opinion. VoiceStream shall have received an opinion of ▇▇▇▇▇, Day,
▇▇▇▇▇▇ & ▇▇▇▇▇ and/or ▇▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇▇ LLP, in form and substance
reasonably satisfactory to VoiceStream, dated the Closing Date, substantially to
the effect that, on the basis of facts, representations and assumptions set
forth in such opinion which are consistent with the state of facts existing as
of the Effective Time, the Merger will constitute a reorganization within the
meaning of Section 368(a) of the Code for federal income tax purposes.
In rendering such opinion, ▇▇▇▇▇, Day, ▇▇▇▇▇▇ & ▇▇▇▇▇ and/or ▇▇▇▇▇▇▇ ▇▇▇▇▇
& ▇▇▇▇▇ LLP may receive and rely upon representations from others, including
representations from (i) Powertel and (ii) VoiceStream contained in certificates
substantially in the form of the Powertel Tax Certificate and the VoiceStream
Tax Certificate attached hereto as Annex F, and Annex G, respectively. Each such
certificate shall be dated on or before the date of such opinion and shall not
have been withdrawn or modified in any material respect.
(c) FCC Opinion. VoiceStream shall have received an opinion of FCC counsel
of Powertel, dated the Effective Time, substantially in the form attached hereto
as Annex E.
(d) Consents Under Agreements. Powertel shall have obtained the consent or
approval of each person whose consent or approval shall be required to
consummate the transactions contemplated hereby under any indenture, mortgage,
evidence of Indebtedness, lease or other agreement or instrument to which
Powertel or any of the Powertel Subsidiaries is a party, except where the
failure to obtain the same would not reasonably be expected, individually or in
the aggregate, to have a Material Adverse Effect on Powertel or VoiceStream or
upon the transactions contemplated by this Agreement.
(e) Governmental Approvals. All necessary consents or authorizations from
Governmental Entities which may be required in connection with the transactions
contemplated hereby, including the FCC and state public utility or service
commissions or similar agencies, shall have been received and, in the case of
the FCC, shall have become Final Orders (unless this requirement of finality is
waived by VoiceStream in its sole discretion), unless the failure to receive any
such consent or authorization would not have a Material Adverse Effect on
Powertel or VoiceStream or the transactions contemplated by this Agreement, and
such consents or authorizations shall not contain any conditions which would
reasonably be expected to have a Material Adverse Effect on Powertel or
VoiceStream or the transactions contemplated by this Agreement.
ARTICLE VII
TERMINATION AND AMENDMENT
SECTION 7.01 Termination. This Agreement may be terminated and the
Reorganization contemplated hereby may be abandoned at any time prior to the
Effective Time, whether before or after any approval by the stockholders of
VoiceStream or Powertel of the matters presented in connection with the
Reorganization:
(a) by mutual written consent of VoiceStream and Powertel;
(b) by either VoiceStream or Powertel:
(i) if the Reorganization has not been effected on or prior to the
close of business on December 31, 2001 (the "Termination Date"); provided
that in the event both the DT Merger Agreement and the Powertel Merger
Agreement shall have terminated, the Termination Date shall instead be the
later of September 30, 2001 and the date that is thirty (30) days after the
date of termination of the DT Merger Agreement and the Powertel Merger
Agreement; provided further that the right to terminate this Agreement
pursuant to this Section 7.01(b)(i) shall not be available to any party
whose failure to fulfill any obligation under this Agreement has been the
cause of, or resulted in, the failure of the Reorganization to have
occurred on or prior to such date; or
(ii) if any Governmental Entity shall have issued an order, decree or
ruling or taken any other action (including by enacting any law or
regulation) (which order, decree, ruling or other action Powertel and
VoiceStream shall use its reasonable best efforts to lift) permanently
enjoining, restraining or otherwise prohibiting or making illegal the
transactions contemplated by this Agreement and such order, decree or
ruling or other action shall have become final and nonappealable; provided,
however, that the
-39-
44
right to terminate this Agreement pursuant to this Section 7.01(b)(ii)
shall not be available to any party who has not used its reasonable best
efforts to cause such order to be lifted or otherwise taken such action as
is required to comply with Section 5.14;
(c) by VoiceStream if (i) Powertel shall have failed to comply with any of
its covenants or agreements contained in this Agreement required to be complied
with prior to the date of such termination, except as would not reasonably be
expected to have a Material Adverse Effect on VoiceStream or the transactions
contemplated by this Agreement, which failure to comply cannot be or has not
been cured within 30 days after receipt by Powertel of written notice of such
failure to comply, (ii) the stockholders of Powertel shall not approve and adopt
the Agreement at the Powertel Stockholders Meeting or any adjournment thereof,
or (iii) the stockholders of VoiceStream shall not approve and adopt the
Agreement at the VoiceStream Stockholders Meeting or any adjournment thereof;
(d) by Powertel if (i) VoiceStream shall have failed to comply with any of
its respective covenants or agreements contained in this Agreement required to
be complied with prior to the date of such termination, except as would not
reasonably be expected to have a Material Adverse Effect on Powertel or
VoiceStream or the transactions contemplated by this Agreement, which failure to
comply cannot be or has not been cured within 30 days after receipt by
VoiceStream of written notice of such failure to comply, (ii) the stockholders
of Powertel shall not approve and adopt the Agreement at the Powertel
Stockholders Meeting or any adjournment thereof; or (iii) the stockholders of
VoiceStream shall not approve and adopt the Agreement at the VoiceStream
Stockholders Meeting or any adjournment thereof;
(e) (i) by Powertel if there has been a breach by VoiceStream of any
representation or warranty (disregarding all qualifications and exceptions
contained therein relating to materiality or a Material Adverse Effect or any
similar standard or qualification) except any breach that would not reasonably
be expected to have a Material Adverse Effect on VoiceStream or the transactions
contemplated by this Agreement, in each case which breach cannot be or has not
been cured within 30 days after receipt by the breaching party of written notice
of the breach and (ii) by VoiceStream if there has been a breach by Powertel of
any representation or warranty (disregarding all qualifications and exceptions
contained therein relating to materiality or a Material Adverse Effect or any
similar standard or qualification) except any breach that would not reasonably
be expected to have a Material Adverse Effect on Powertel or VoiceStream or the
transactions contemplated by this Agreement, in each case which breach cannot be
or has not been cured within 30 days after receipt by the breaching party of
written notice of the breach; or
(f) automatically, without any action being required of any party hereto,
concurrently with the closing of the DT Merger.
SECTION 7.02 Effect of Termination. In the event of a termination of this
Agreement by either Powertel or VoiceStream as provided in Section 7.01, this
Agreement shall forthwith become void and there shall be no liability or
obligation on the part of VoiceStream or Powertel or their respective officers
or directors, except with respect to Section 2.18, Section 3.14, Section 5.10 or
this Section 7.02; provided, however, that neither any provision in this Article
VII nor the payment of any fees and expenses pursuant to Section 5.10, shall be
interpreted to (i) relieve any party of liability for any breach of this
Agreement, (ii) constitute liquidated damages or (iii) limit the amount of
damages that may be recovered for a breach of this Agreement.
SECTION 7.03 Amendment. This Agreement may be amended by the parties
hereto, by or pursuant to action taken by their respective Boards of Directors,
at any time before or after approval by the stockholders of VoiceStream and
Powertel of the matters presented to them in connection with the Reorganization;
provided, however, that after any such approval, no amendment shall be made if
applicable law would require further approval by such stockholders, unless such
further approval shall be obtained. This Agreement may not be amended except by
an instrument in writing signed on behalf of each of the parties hereto.
SECTION 7.04 Extension; Waiver. At any time prior to the Effective Time,
the parties hereto, by action taken or authorized by their respective Boards of
Directors, may, to the extent legally allowed, (i) extend the time for the
performance of any of the obligations or other acts of the other parties hereto,
(ii) waive any
-40-
45
inaccuracies in the representations and warranties contained herein or in any
document delivered pursuant hereto or (iii) waive compliance with any of the
agreements or conditions contained herein. Any agreement on the part of a party
hereto to any such extension or waiver shall be valid only if set forth in a
written instrument signed on behalf of such party. The failure of any party to
this Agreement to assert any of its rights under this Agreement or otherwise
shall not constitute a waiver of those rights.
ARTICLE VIII
GENERAL PROVISIONS
SECTION 8.01 Non-Survival of Representations and Warranties and
Agreements. None of the representations and warranties in this Agreement or in
any instrument delivered pursuant to this Agreement shall survive the Effective
Time or, except as set forth in Section 7.02 hereof, the termination of this
Agreement pursuant to the terms hereof. This Section 8.01 shall not limit any
covenant or agreement of the parties which by its terms contemplates performance
after the Effective Time.
SECTION 8.02 Notices. (a) All notices and other communications hereunder
shall be in writing and shall be deemed given if delivered personally, sent by
overnight courier (providing proof of delivery) or telecopied (with a
confirmatory copy sent by overnight courier) to the parties at the following
addresses (or at such other address for a party as shall be specified by like
notice):
if to VoiceStream to:
Voicestream Wireless Corporation
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇.▇.
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Telecopy No: ▇▇▇-▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇, Esq.
Telecopy No: 206-623-7022
if to Powertel, to:
Powertel, Inc.
▇▇▇▇ ▇.▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: Chairman of the Board
Telecopy No: ▇▇▇-▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇, LLP
1600 Atlanta Financial Center
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇ IV, Esq.
Telecopy No: ▇▇▇-▇▇▇-▇▇▇▇
or to such other addresses as the party to whom notice is to be given may have
furnished to the other party in writing in accordance herewith.
-41-
46
(b) Copies of all notices delivered to VoiceStream or Powertel pursuant to
this Agreement shall also be provided by the party providing such notice to DT
at the following address:
Deutsche Telekom AG
140 ▇▇▇▇▇▇▇▇▇-▇▇▇▇▇ Allee
53113 Bonn
Germany
Attn: ▇▇▇▇▇ ▇▇▇▇
Telecopy No: 49-228-181-44177
with a copy to:
Cleary, Gottlieb, ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Telecopy No: 212-225-3999
or to such other addresses as DT may have furnished to VoiceStream and Powertel
in writing in accordance herewith.
SECTION 8.03 Interpretation; Definitions. When a reference is made in this
Agreement to an Article, Section, Schedule, Annex or Exhibit, such reference
shall be to an Article, Section, Schedule, Annex or Exhibit of this Agreement
unless otherwise indicated or unless the context otherwise requires. The table
of contents and headings contained in this Agreement are for reference purposes
only and shall not affect in any way the meaning or interpretation of this
Agreement. Whenever the words "include," "includes" or "including" are used in
this Agreement, they shall be deemed to be followed by the words "without
limitation." References to a Person are also references to its assigns and
successors in interest (by means of merger, consolidation or sale of all or
substantially all the assets of such Person or otherwise, as the case may be).
References to a document are to such document as amended, waived and otherwise
modified from time to time and references to a statute or other governmental
rule are to such statute or rule as amended and otherwise modified from time to
time (and references to any provision thereof shall include references to any
successor provision). The definitions set forth herein are equally applicable
both to the singular and plural forms and the feminine, masculine and neuter
forms of the terms defined. The term "hereof" and similar terms refer to this
Agreement as a whole. As used in this Agreement, the phrase "made available"
shall mean that the information referred to has been made available if requested
by the party to whom such information is to be made available.
As used in this Agreement, the following terms have the meanings specified
or referred to in this Section 8.03.
"Action" shall mean any action, suit, arbitration, inquiry, proceeding or
investigation by or before any court, any governmental or other regulatory or
administrative agency or commission or any arbitration tribunal.
"Adjusted Fully Diluted Shares" shall have the meaning set forth in Section
1.06(e).
"Affiliate" shall mean with respect to any Person, any other Person
directly or indirectly controlling, controlled by, or under common control with
such Person provided that, for purposes of this definition, "control"
(including, with correlative meanings, the terms "controlled by" and "under
common control with"), as used with respect to any Person, shall mean the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of such Person, whether through the
ownership of voting securities or by contract or otherwise.
"Agreement" shall mean this Agreement and Plan of Reorganization dated the
date hereof among VoiceStream and Powertel and shall include the Schedules,
Annexes, Exhibits and disclosure letters attached or related hereto.
-42-
47
"Alternative Transaction" shall have the meaning set forth in Section
4.03(d).
"April 1996 Indenture" shall mean the Indenture dated as of April 19, 1996,
among Powertel and Bankers Trust Company relating to the 12% Senior Discount
Notes due May 2006.
"Business Day" means a day other than a Saturday, Sunday or other day on
which commercial banks in New York City, Atlanta, Georgia or Seattle, Washington
are authorized or required by law to close.
"Certificate of Merger" shall have the meaning set forth in Section 1.03.
"Closing" shall have the meaning set forth in Section 1.02.
"Closing Date" shall have the meaning set forth in Section 1.02.
"Code" shall mean the United States Internal Revenue Code of 1986, as
amended.
"Communications Act" shall mean, collectively, the Communications Act of
1934, as amended, and the Telecommunications Act of 1996, as amended, together
with the rules, regulations and published decisions of the FCC promulgated
thereunder.
"Confidentiality Agreement" shall have the meaning set forth in Section
4.03(a).
"Conversion Number" shall have the meaning set forth in Section 1.06(c).
"▇▇▇▇ Inlet Joint Ventures" means ▇▇▇▇ Inlet Western Wireless PV/SS PCS,
L.P., ▇▇▇▇ Inlet Voicestream PCS, LLC, ▇▇▇▇ Inlet/VS GSM II PCS, LLC and ▇▇▇▇
Inlet/VS GSM III PCS, LLC.
"▇▇▇▇ Inlet Partners" means ▇▇▇▇ Inlet Telecommunications, Inc., SSPCS
Corporation, Providence Media Partners, L.P., ▇▇▇▇ Inlet GSM Inc., Providence
Media Partners III L.P. and Providence Equity Operating Partners III.
"DiGiPH Transaction" means the transactions and agreements relating to the
acquisition of substantially all of the assets of DiGiPH PCS, Inc., DigiPH
Communication, Inc. and DigiPH Holding Company, Inc. by Eliska, as described in
Powertel's Form 8-K as filed on June 16, 2000, including (i) all agreements and
commitments that have been entered into in connection therewith as listed in the
Powertel Letter, (ii) all agreements that are proposed to be entered into prior
to the closing of such transactions, forms or summaries of which, or term sheets
for which, have been provided to VoiceStream and are listed in the Powertel
Letter and (iii) any other agreements that are to be entered into prior to the
closing of such transactions that are reasonably necessary to consummate such
transactions (and any amendments or modifications thereof), and with respect to
clauses (ii) and (iii) that such agreements do not (A) materially alter the
scope of such transactions, (B) materially increase Powertel's obligations in
connection therewith or (C) interfere with the transactions contemplated by this
Agreement or the DT Merger Agreement.
"D&O Insurance" shall have the meaning set forth in Section 5.13(b).
"DGCL" shall mean the Delaware General Corporation Law, as amended.
"DT" shall have the meaning set forth in the recitals of this Agreement.
"DT Merger" shall have the meaning set forth in the recitals of this
Agreement.
"DT Merger Agreement" shall have the meaning set forth in the recitals of
this Agreement.
"DT Registration Statement" shall mean one or more registration statements
to be filed with the SEC by DT in connection with the issuance of DT depositary
shares and DT ordinary shares in the DT Merger.
"Effective Time" shall have the meaning set forth in Section 1.03.
"Eliska" means Eliska Wireless Ventures I, Inc.
"Eliska Put" shall have the meaning set forth in Section 1.06(d).
"Eliska Put Rights" shall have the meaning set forth in Section 1.06(d).
-43-
48
"Environmental Laws" shall mean any applicable statute, law, ordinance,
regulation, rule, judgment, decree or order of any Governmental Entity relating
to or regulating or imposing liability or standards of conduct with respect to
pollution, protection of the environment or environmental regulation or control
or regarding Hazardous Substances or occupational health or safety.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974, as
amended, together with the rules and regulations promulgated thereunder.
"ERISA Affiliate" shall mean (i) any corporation which is a member of the
same controlled group of corporations (within the meaning of Section 414(b) of
the Code) as Powertel; (ii) any partnership, trade or business (whether or not
incorporated) which on the day before the Closing Date was under common control
(within the meaning of Section 414(c) of the Code) with Powertel; and (iii) any
entity which is a member of the same affiliated service group (within the
meaning of Section 414(m) of the Code) as either Powertel, any corporation
described in clause (i) or any partnership, trade or business described in
clause (ii).
"ERISA Benefit Plan" shall mean a Powertel Benefit Plan maintained as of
the date of this Agreement which is also an "employee pension benefit plan" (as
defined in Section 3(2) of ERISA) or which is also an "employee welfare benefit
plan" (as defined in Section 3(1) of ERISA).
"Exchange Act" shall mean the Securities Exchange Act of 1934, as amended,
together with the rules and regulations promulgated thereunder.
"Exchange Agent" shall have the meaning set forth in Section 1.07(a).
"Exchange Fund" shall have the meaning set forth in Section 1.07(a).
"Exchange Rights" shall have the meaning set forth in Section 3.03(a).
"FAA" shall mean the Federal Aviation Administration and any successor
agency or body.
"FCC" shall mean the Federal Communications Commission and any successor
agency or body.
"FCC Applications" shall have the meaning set forth in Section 5.14(b).
"February 1996 Indenture" shall mean the Indenture dated as of February 7,
1996, among Powertel and Bankers Trust Company relating to the 12% Senior
Discount Notes due February 2006.
"Final Order" shall mean action by the applicable Governmental Entity which
is in full force and effect, with respect to which no petition or other request
for such Governmental Entity or court stay, reconsideration or review of any
kind is pending, and as to which all time periods have expired within which a
Governmental Entity may be asked to stay, reconsider or review the action or may
stay, reconsider or review the action sua sponte.
"Governmental Entity" shall mean any federal, state or local government or
any court, tribunal, administrative agency or commission or other governmental
or other regulatory authority or agency, domestic, foreign or supranational,
including the FAA, FCC and any state public utility or service commission or
similar agency.
"Hazardous Substance" shall mean any material defined as toxic or
hazardous, including any petroleum and petroleum products, under any applicable
Environmental Law.
"HSR Act" shall mean the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Antitrust Improvements Act of
1976, as amended.
"incentive stock options" shall have the meaning set forth in Section
5.02(b).
"Indebtedness" of any Person at any date shall mean (a) all indebtedness of
such Person for borrowed money or for the deferred purchase price of property or
services (other than current trade liabilities incurred in the ordinary course
of business and payable in accordance with customary practices), (b) any other
indebtedness of such Person which is evidenced by a note, bond, debenture or
similar instrument, (c) all obligations of such Person under financing leases,
(d) all obligations of such Person in respect of acceptances issued or created
for the account of such Person and with respect to unpaid reimbursement
obligations related
-44-
49
to letters of credit issued for the account of such Person and (e) all
liabilities secured by any Lien on any property owned by such Person even though
such Person has not assumed or otherwise become liable for the payment thereof.
"Indemnified Person" shall have the meaning set forth in Section 5.13(a).
"Intellectual Property Rights" shall mean any right to use, all patents,
patent rights, trademarks, trade names, trade dress, logos, service marks,
copyrights, know how and other proprietary intellectual property rights and
computer programs held or used by Powertel or any of the Powertel Subsidiaries
that are individually or in the aggregate material to the conduct of the
business of Powertel and the Powertel Subsidiaries, taken as a whole.
"Investment Entity" shall mean an entity in which Powertel or any of the
Powertel Subsidiaries has an Investment Interest.
"Investment Interest" shall mean a direct or indirect ownership of (i)
capital stock, bonds, debentures, partnership, membership interests or other
ownership interests or other securities of any Person; (ii) any deposit with or
advance, loan or other extension of credit (including the purchase of property
from another Person subject to an understanding or agreement, contingent or
otherwise to resell such property to such other Person) to any other Person;
(iii) any revenue or profit interests pursuant to any agreement or license, or
(iv) any agreement, commitment, right, understanding or arrangement with respect
to any of the items referred to in (i), (ii) or (iii) of this definition.
"Joint Proxy Statement" shall have the meaning set forth in Section 2.08.
"June 1997 Indenture" shall mean the Indenture dated as of June 10, 1997
among Powertel and Bankers Trust Company relating to the Senior Notes.
"knowledge" and "known to" shall mean the actual knowledge of the executive
officers of Powertel or the executive officers of VoiceStream, as the case may
be, who have exercised reasonable due diligence with respect to the
representation and warranty to which such knowledge statement is made.
"Liens" shall mean any pledges, claims, liens, charges, encumbrances and
security interests of any kind or nature whatsoever.
"Material Adverse Change" or "Material Adverse Effect" shall mean, when
used in connection with Powertel or VoiceStream, as the case may be, any change
or effect (or any development that, insofar as can reasonably be foreseen, is
likely to result in any change or effect) or fact or condition that is
materially adverse to the business, properties, assets, financial condition or
results of operations of Powertel and its Subsidiaries taken as a whole, or
VoiceStream and its Subsidiaries taken as a whole, as the case may be, provided,
however, that (i) any adverse change, effect or development that is primarily
caused by conditions affecting the United States economy generally or the
economy of any nation or region in which Powertel or VoiceStream, as the case
may be, or its Subsidiaries conducts business that is material to the business
of Powertel or VoiceStream, as the case may be, and its Subsidiaries, taken as a
whole, shall not be taken into account in determining whether there has been (or
whether there could reasonably be foreseen) a "Material Adverse Change" or
"Material Adverse Effect" with respect to Powertel or VoiceStream, as the case
may be, (ii) any adverse change, effect or development that is primarily caused
by conditions generally affecting the industries in which Powertel or
VoiceStream, as the case may be, conducts its business shall not be taken into
account in determining whether there has been (or whether there could reasonably
be foreseen) a "Material Adverse Change" or "Material Adverse Effect" with
respect to Powertel or VoiceStream, as the case may be, and (iii) any adverse
change, effect or development that is primarily caused by the announcement or
pendency of this Agreement, the Reorganization or the transactions contemplated
hereby shall not be taken into account in determining whether there has been (or
whether there could reasonably be foreseen) a "Material Adverse Change" or
"Material Adverse Effect" with respect to Powertel or VoiceStream, as the case
may be; and a "Material Adverse Effect" with respect to either Powertel or
VoiceStream, as the case may be, shall include any applicable event, fact or
condition with respect to such party which would reasonably be expected to
materially delay, interfere with, impair or prevent the transactions
contemplated by this agreement in a
-45-
50
manner which would have a material adverse effect on such transactions taken as
a whole considering the intentions and expectations of the parties hereto.
"Maximum Share Amount" shall have the meaning set forth in Section 1.06(e).
"Merger" shall have the meaning set forth in the recitals of this
Agreement.
"Nasdaq" shall have the meaning set forth in Section 1.06(c).
"1991 Plan" shall have the meaning set forth in Section 2.03.
"Nonemployee Option Plan" shall have the meaning set forth in Section 2.03.
"Notes" shall have the meaning set forth in Section 5.17.
"Person" shall mean an individual, corporation, partnership, limited
liability company, joint venture, association, joint stock company,
unincorporated syndicate, unincorporated organization, trust, trustee, executor,
administrator or other legal representative, Governmental Entity, political
subdivision, or any group of Persons acting in concert.
"Powertel" shall have the meaning set forth in the introductory paragraph
of this Agreement.
"Powertel Benefit Plan" shall mean any bonus, pension, profit sharing,
deferred compensation, incentive compensation, stock ownership, stock purchase,
stock option, phantom stock, retirement, vacation, severance, disability, death
benefit, hospitalization, medical, life insurance, supplemental unemployment
benefits, employee stock purchase, stock appreciation, restricted stock or other
employee benefit plan, policy, arrangement or agreement providing benefits to
any current or former employee, officer or director of Powertel or any of the
Powertel Subsidiaries or with respect to which Powertel or any of the Powertel
Subsidiaries (or, in the case of an ERISA Benefit Plan, any of the Powertel's
ERISA Affiliates) may have any liability.
"Powertel Certificates" shall have the meaning set forth in Section
1.07(a).
"Powertel Common Stock" shall have the meaning set forth in the recitals of
this Agreement.
"Powertel Common Stock Equivalents" shall have the meaning set forth in
Section 2.03.
"Powertel Contracts" shall have the meaning set forth in Section 2.20.
"Powertel Employee" shall mean any employee of Powertel or any of the
Powertel Subsidiaries.
"Powertel FCC Licenses" shall have the meaning set forth in Section
2.09(b)(i).
"Powertel Financial Advisor" shall have the meaning set forth in Section
2.17.
"Powertel Indentures" shall have the meaning set forth in Section 5.17.
"Powertel Letter" shall mean the letter from Powertel to VoiceStream dated
the date hereof, which letter relates to this Agreement and is designated
therein as the Powertel Letter.
"Powertel Merger" shall have the meaning set forth in the recitals of this
Agreement.
"Powertel Merger Agreement" shall have the meaning set forth in the
recitals of this Agreement.
"Powertel Permits" shall have the meaning set forth in Section 2.09.
"Powertel Preferred Stock" shall have the meaning set forth in the recitals
of this Agreement and in Section 2.03.
"Powertel Principal Stockholders" shall mean ITC Holding Company, Inc., ITC
Service Company, Inc.; ITC Wireless Inc.; SCANA Communications Holdings, Inc.;
Sonera Corporation; Sonera Holding B.V.; ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇; The ▇▇▇▇▇▇
Partnership, L.P.; The ▇▇▇▇▇▇ Partnership (QP) L.P.; South Atlantic Venture Fund
II, L.P.; South Atlantic Venture Fund III, L.P.; South Atlantic Private Equity
Fund IV, L.P.; South Atlantic Private Equity Fund IV (QP) L.P.; and American
Water Works Company.
-46-
51
"Powertel Registration Statement" shall mean one or more registration
statements to be filed with the SEC by DT in connection with the issuance of DT
depositary shares and DT ordinary shares in the Powertel Merger.
"Powertel Restricted Stock Awards" shall mean restricted stock awards
granted under the Restricted Stock Plan and the 2000 Plan.
"Powertel Required Approvals" shall have the meaning set forth in Section
2.05.
"Powertel SEC Documents" shall have the meaning set forth in Section 2.06.
"Powertel Stock" shall have the meaning set forth in the recitals of this
Agreement.
"Powertel Stock Rights" shall have the meaning set forth in Section 2.03.
"Powertel Stockholder Agreement" shall have the meaning set forth in the
recitals of this Agreement.
"Powertel Stockholder Approval" shall have the meaning set forth in Section
2.04.
"Powertel Stockholders Meeting" shall have the meaning set forth in Section
5.03(a).
"Powertel Stock Options" shall have the meaning set forth in Section 2.03.
"Powertel Stock Option Plans" shall have the meaning set forth in Section
2.03.
"Powertel Subsidiaries" shall have the meaning set forth in Section 2.01.
"Powertel Warrants" shall have the meaning set forth in Section 1.06(d).
"Registration Statement" shall have the meaning set forth in Section 3.04.
"Reorganization" shall have the meaning set forth in the recitals of this
Agreement.
"Required Regulatory Approvals" shall have the meaning set forth in Section
3.05.
"Restated By-laws of Powertel" shall mean the Second Restated By-laws of
Powertel as in effect on the date hereof.
"Restated Certificate of Incorporation of Powertel" shall mean the Third
Restated Certificate of Incorporation, as amended and as in effect on the date
hereof.
"Restricted Stock Plan" shall have the meaning set forth in Section 2.03.
"Rule 145 Affiliates" shall have the meaning set forth in Section 5.08(a).
"SEC" shall mean the Securities and Exchange Commission.
"Securities Act" shall mean the Securities Act of 1933, as amended,
together with the rules and regulations promulgated thereunder.
"Senior Discount Notes" shall mean Powertel's 12% Senior Discount Notes due
February 2006 and the 12% Senior Discount Notes due May 2006.
"Senior Notes" shall mean Powertel's 11 and 1/8% Senior Notes due June
2007.
"Series A Preferred Shares" shall have the meaning set forth in Section
2.03.
"Series B Preferred Shares" shall have the meaning set forth in Section
2.03.
"Series C Preferred Shares" shall have the meaning set forth in Section
2.03.
"Series D Preferred Shares" shall have the meaning set forth in Section
2.03.
"Series E Preferred Shares" shall have the meaning set forth in Section
2.03.
"Series F Preferred Shares" shall have the meaning set forth in Section
2.03.
-47-
52
"Significant Employee" shall mean any Employee of Powertel or any of the
Powertel Subsidiaries who (i) is an officer of Powertel or any of the Powertel
Subsidiaries, (ii) has a written employment contract with Powertel or any of the
Powertel Subsidiaries that calls for annual compensation in excess of $90,000,
or (iii) is compensated by Powertel and/or any of the Powertel Subsidiaries at
an annual rate greater than $90,000.
"Sonera Put" shall have the meaning set forth in Section 1.06(d).
"Sonera Stock Purchase Agreement" shall have the meaning set forth in
Section 1.06(e).
"Stockholder Meetings" shall mean the Powertel Stockholders Meeting and the
VoiceStream Stock-holders Meeting.
"Sub" shall have the meaning set forth in the recitals of this Agreement.
"Subsequent Determination" shall have the meaning set forth in Section
5.03(d).
"Subsequent Transaction" shall mean any transaction entered into after date
hereof whereby VoiceStream or any of its Subsidiaries would (i) acquire or be
acquired (by merger, consolidation, acquisition of stock or assets or otherwise)
by any corporation, limited liability company, partnership, other business
organization or assets or division thereof; (ii) acquire an Investment Interest
in any of the foregoing; (iii) issue any equity interest or incur any
Indebtedness whether in connection with any item described in (i) or (ii) or
otherwise; (iv) enter into or engage in a strategic alliance or other commercial
relationship; or (v) act in the ordinary course of business; provided, however,
in connection with a Subsequent Transaction described in items (i), (ii), (iii)
or (iv) of this definition for a consideration paid by VoiceStream or any of its
Subsidiaries in an amount greater than $5 billion, VoiceStream must receive an
opinion from a nationally recognized investment bank, acting as financial
advisor to VoiceStream, to the effect that, from a financial point of view, such
Subsequent Transaction is fair to the holders of VoiceStream Common Stock or, if
applicable, VoiceStream.
"Subsidiary" or "subsidiary" of a Person shall mean any Person (including
any corporation, partnership, joint venture, limited liability company or other
entity) in which the Person in question owns, directly or indirectly, an amount
of the voting securities, other voting ownership or voting partnership interests
which is sufficient to elect at least a majority of such Person's Board of
Directors or other governing body (or, if there are no such voting interests,
50% or more of the equity interests) of such Person.
"Substitute Options" shall have the meaning set forth in Section 5.02(b).
"Superior Proposal" shall have the meaning set forth in Section 5.03(d).
"Surviving Corporation" shall have the meaning set forth in Section 1.01.
"Tax" and "Taxes" shall mean any federal, state, local or foreign net
income, gross income, gross receipts, windfall profit, severance, property,
production, sales, use, license, excise, franchise, employment, payroll,
withholding, alternative or add-on minimum or any other tax, custom, duty,
governmental fee or other like assessment or charge of any kind whatsoever,
together with any interest or penalty, addition to tax or additional amount
imposed by any Governmental Entity.
"Tax Return" shall mean any return, report or similar statement required to
be filed with respect to any Tax including any information return, claim for
refund, amended return or declaration of estimated tax.
"Termination Date" shall have the meaning set forth in Section 7.01(b)(i).
"Termination Fee" shall have the meaning set forth in Section 5.10(b).
"Third Party" shall have the meaning set forth in Section 4.03(d).
"2000 Plan" shall have the meaning set forth in Section 2.03.
"VoiceStream" shall have the meaning set forth in the introductory
paragraph of this Agreement.
"VoiceStream Average Closing Price" shall have the meaning set forth in
Section 1.06(c).
-48-
53
"VoiceStream Certificates" shall have the meaning set forth in Section
1.07(a).
"VoiceStream Common Stock" shall have the meaning set forth in the recitals
of this Agreement.
"VoiceStream Equity Rights" shall have the meaning set forth in Section
3.03(a).
"VoiceStream FCC Licenses" shall have the meaning set forth in Section
3.09.
"VoiceStream Letter" shall mean the letter from VoiceStream to Powertel
dated the date hereof, which letter relates to this Agreement and is designated
therein as the VoiceStream Letter.
"VoiceStream Permits" shall have the meaning set forth in Section 3.09.
"VoiceStream Principal Stockholders" shall mean ▇▇▇▇ ▇. ▇▇▇▇▇▇▇; ▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇▇; PN Cellular, Inc.; ▇▇▇▇▇▇▇ Family Trust; ▇▇▇▇▇▇▇ Communications
Corporation; GS Capital Partners, L.P.; The ▇▇▇▇▇▇▇ Sachs Group, Inc.; ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇, L.P.; Stone Street Fund 1992, L.P.; Sonera Corporation; Sonera
Holding B.V.; ▇▇▇▇▇▇▇▇▇ Telecommunications PCS (USA) Limited; ▇▇▇▇▇▇▇▇▇
Telecommunications Holdings (USA) Limited and Telephone and Data Systems, Inc.
"VoiceStream Required Approvals" shall have the meaning set forth in
Section 3.05.
"VoiceStream SEC Documents" shall have the meaning set forth in Section
3.06.
"VoiceStream Stockholder Agreement" shall have the meaning set forth in the
recitals of this Agreement.
"VoiceStream Stockholder Approval" shall have the meaning set forth in
Section 3.04.
"VoiceStream Stockholders Meeting" shall have the meaning set forth in
Section 5.03(b).
"VoiceStream Subsidiaries" shall have the meaning set forth in Section
3.01.
"Warrant Agreement" shall have the meaning set forth in Section 1.06(d).
SECTION 8.04 Counterparts. This Agreement may be executed in counterparts,
all of which shall be considered one and the same agreement, and shall become
effective when one or more counterparts have been signed by each of the parties
and delivered to the other parties, it being understood that all parties need
not sign the same counterpart.
SECTION 8.05 Entire Agreement; No Third-Party Beneficiaries. Except for
the Confidentiality Agreement, this Agreement constitutes the entire agreement
and supersedes all prior agreements and understandings, both written and oral,
among the parties with respect to the subject matter hereof. This Agreement,
except for the provisions of Sections 5.01, 5.13 and 8.02(b), is not intended to
confer upon any person other than the parties hereto any rights or remedies
hereunder.
SECTION 8.06 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF DELAWARE, REGARDLESS OF
THE LAWS THAT MIGHT OTHERWISE GOVERN UNDER APPLICABLE PRINCIPLES OF CONFLICTS OF
LAWS.
SECTION 8.07 Assignment. Neither this Agreement nor any of the rights,
interests or obligations hereunder shall be assigned by any of the parties
hereto without the prior written consent of the other parties. Subject to the
preceding sentence, this Agreement shall be binding upon, inure to the benefit
of, and be enforceable by, the parties and their respective successors and
assigns.
SECTION 8.08 Severability. If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced by any rule of law,
or public policy, all other conditions and provisions of this Agreement shall
nevertheless remain in full force and effect so long as the economic and legal
substance of the transactions contemplated hereby are not affected in any manner
materially adverse to any party. Upon such determination that any term or other
provision is invalid, illegal or incapable of being enforced, the parties shall
negotiate in good faith to modify this Agreement so as to effect the original
intent of the parties as closely as possible in a mutually acceptable manner in
order that the transactions contemplated by this Agreement may be consummated as
originally contemplated to the fullest extent possible.
-49-
54
SECTION 8.09 Enforcement of this Agreement. The parties hereto agree that
irreparable damage would occur in the event that any of the provisions of this
Agreement were not performed in accordance with their specific terms or were
otherwise breached in any material respect. It is accordingly agreed that the
parties shall be entitled to an injunction or injunctions to prevent breaches of
this Agreement or any related agreement and to enforce specifically the terms
and provisions of this Agreement or any related agreement in the Court of
Chancery of the State of Delaware or the Federal District Court for the District
of Delaware, this being in addition to any other remedy to which they are
entitled at law or in equity. In addition, each of the parties hereto (a)
consents to submit itself to the personal jurisdiction of the Court of Chancery
of the State of Delaware and Federal District Court for the District of Delaware
in the event any dispute arises out of this Agreement or any related agreement
or any transaction contemplated hereby or thereby, (b) agrees that it will not
attempt to deny or defeat such personal jurisdiction by motion or other request
for leave from any such court, (c) agrees that it will not bring any action
relating to this Agreement or any related agreement or any transaction
contemplated hereby or thereby in any court other than the Court of Chancery of
the State of Delaware or the Federal Court for the District of Delaware and (d)
waives any right to trial by jury with respect to any action related to or
arising out of this Agreement or related agreement or any transaction
contemplated hereby or thereby. Neither the payment of fees and expenses
pursuant to Section 5.10, any action seeking damages pursuant to Section 7.02,
nor any action brought pursuant to this Section 8.09, shall be interpreted as
providing an exclusive remedy to any party.
SECTION 8.10 Obligations of Subsidiaries. Whenever this Agreement requires
any Powertel or VoiceStream Subsidiary (including Sub) to take any action, such
requirement shall be deemed to include an undertaking on the part of VoiceStream
or Powertel, as the case may be, to cause such Subsidiary to take such action.
SECTION 8.11 Reliance on Representations. Notwithstanding any
investigation, knowledge or review made at any time by or on behalf of any party
hereto, the parties acknowledge and agree that all representations and
warranties contained in this Agreement, the Annexes, the Powertel Letter, the
VoiceStream Letter or in any of the documents, certifications or agreements
delivered in connection therewith, are being relied upon as a material
inducement to enter into this Agreement and the transactions contemplated
hereby.
SECTION 8.12 Failure or Indulgence Not Waiver; Remedies Cumulative. No
failure or delay on the part of any party hereto in the exercise of any right
hereunder will impair such right or be construed to be a waiver of, or
acquiescence in, any breach of any representation, warranty or agreement herein,
nor will any single or partial exercise of any such right preclude other or
further exercise thereof or of any other right. All rights and remedies existing
under this Agreement are cumulative to, and not exclusive to, and not exclusive
of, any rights or remedies otherwise available.
SECTION 8.13 Rules of Construction. The parties hereto agree that they
have been represented by counsel during the negotiation and execution of this
Agreement and, therefore, waive the application by any law, regulation, holding
or rule of construction providing that ambiguities in an agreement or other
document will be construed against the party drafting such agreement or
document.
[Remainder of this page intentionally left blank]
-50-
55
IN WITNESS WHEREOF, VoiceStream and Powertel have caused this Agreement to
be signed by their respective officers thereunto duly authorized all as of the
date first written above.
VOICESTREAM WIRELESS CORPORATION POWERTEL, INC.
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
---------------------------------------------------- ----------------------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Executive Vice President -- Finance, Title: President and Chief Executive Officer
Strategy and Development
SIGNATURE PAGE TO AGREEMENT AND PLAN OF REORGANIZATION
