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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED): SEPTEMBER 25, 1998
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WESTOWER CORPORATION
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(Exact name of registrant as specified in its charter)
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WASHINGTON 1-132963 91-1825860
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(State or Other (Commission (IRS Employer
Jurisdiction of File Number) Identification No.)
Incorporation)
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7001 N.E. 40TH AVENUE, VANCOUVER, WASHINGTON 98661
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(Address of Principal Executive Offices) (Zip Code)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (360) 750-9355
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(Former Name or Former Address, if Changed Since Last Report)
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ITEM 5. OTHER EVENTS.
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On September 25, 1998, Westower Corporation (the "Company") completed the
acquisition of CNG Communications, Inc., a Delaware corporation ("CNG"),
pursuant to an Agreement of Merger (the "Merger Agreement") with CNG, CNG's
stockholder (the "Stockholder"), and Westower CNG Acquisition Company, a
Delaware corporation and a wholly-owned subsidiary of the Company ("Sub").
Pursuant to the terms of the Merger Agreement, CNG was merged with and into Sub,
which survived as a corporation under the name "CNG Communications, Inc." CNG,
headquartered in Tucson, Arizona, provides telecommunications tower consulting
services. Under the terms of the Merger Agreement, the total consideration paid
at closing by the Company to the Stockholder was $1,671,945 in cash. The
Stockholder may also receive up to an additional $3,000,000 in cash when and if
an acquisition of certain assets from MCI Telecommunications, Inc. (described
below) is completed. The merger price was determined by arms-length
negotiations between the parties. The merger price was paid out of the
Company's cash on hand. The foregoing description is qualified in its entirety
by reference to the Merger Agreement, a copy of which is attached hereto as
Exhibit 99.
On October 2, 1998, the Company's subsidiary CNG Communications, Inc.
agreed to purchase certain assets from MCI Telecommunications, Inc. relating to
its American Television Relay business unit. The principal assets involved
consist of 108 telecommunications towers located in the Southwestern United
States. The purchase price is $9,200,000. The purchase is expected to be
completed in early 1999 following receipt of regulatory approvals.
ITEM 7. EXHIBITS.
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99 Agreement of Merger, dated as of September 17, 1998, among CNG
Communications, Inc., Paul Bishop, Westower Corporation and Westower CNG
Acquisition Company.
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SIGNATURE
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Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
WESTOWER CORPORATION
Date: October 8, 1998 By: /s/ Peter Lucas
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Peter Lucas, Senior Vice President,
Chief Financial Officer, Treasurer
and Secretary
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Exhibit Index
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Exhibit
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99 Agreement of Merger, dated as of September 17, 1998, among CNG
Communications, Inc., Paul Bishop, Westower Corporation and Westower CNG
Acquisition Company.
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EXHIBIT 99
Execution Copy
AGREEMENT OF MERGER
BY AND AMONG
CNG COMMUNICATIONS, INC.,
PAUL BISHOP,
WESTOWER CORPORATION
AND
WESTOWER CNG ACQUISITION COMPANY
DATED AS OF SEPTEMBER 17, 1998
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CONTENTS
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ARTICLE 1 THE MERGER 1
Section 1.1 Merger 1
Section 1.2 Shares of Company and Sub 2
(a) Company Shares 2
(b) Sub Shares 2
Section 1.3 Certificate of Incorporation 2
Section 1.4 Bylaws 2
Section 1.5 Directors and Officers 2
ARTICLE 2 CLOSING AND CLOSING DOCUMENTS 3
Section 2.1 Date, Time and Place of Closing 3
Section 2.2 Stockholder and Company Closing Documents; Deliveries
to Westower and Sub 3
(a) Stock Certificates 3
(b) Company Good Standing Certificates 3
(c) Stockholder/Company Certificate 3
(d) Resolutions Authorizing Transaction 4
(e) Opinion of Counsel 4
(f) Other Instruments 4
Section 2.3 Westower and Sub Closing Documents: Deliveries to
Stockholder and Company 4
(a) Westower/Sub Certificate 4
(b) Resolutions Authorizing Transaction 4
(c) Merger Consideration 5
(d) Other Instruments 5
ARTICLE 3 REPRESENTATIONS AND WARRANTIES OF STOCKHOLDER AND
COMPANY CONCERNING COMPANY 5
Section 3.1 Organization and Authority of Company 5
Section 3.2 No Subsidiaries, Partnerships and Joint Ventures 5
Section 3.3 Financial Statements 5
Section 3.4 No Undisclosed Liabilities 6
Section 3.5 Dealings with Affiliates 6
Section 3.6 Taxes 6
Section 3.7 Contracts 7
Section 3.8 Facts Giving Rise to Possible Claims/Litigation 8
Section 3.9 Customers and Suppliers 8
Section 3.10 Accounts Receivable 8
Section 3.11 Corporate Books and Records 8
Section 3.12 Title to Properties 9
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Section 3.13 Conflicts with Instruments and Laws 9
Section 3.14 Governmental Authorizations 9
Section 3.15 Claims, Administrative Actions and Lawsuits 9
Section 3.16 Leases; No Unowned Assets Utilized 10
Section 3.17 Insurance 10
Section 3.18 Absence of Certain Changes or Events 10
Section 3.19 Real Property: Business Locations 11
Section 3.20 Environmental Liabilities 12
Section 3.21 Absence of Questionable Payments 13
Section 3.22 Company's Employees 14
Section 3.23 WARN 14
Section 3.24 Compliance with Laws 14
Section 3.25 Employee Benefit Plans 15
(a) Benefit Plans 15
(b) Pension and Welfare Benefit Plans 15
(c) Withdrawal Liability 15
(d) No Prohibited Transactions 15
(e) No PBGC Liability 16
(f) Full Payment to Plans 16
(g) Plans In Compliance with Laws 16
Section 3.26 Full Disclosure 16
ARTICLE 4 REPRESENTATIONS AND WARRANTIES OF STOCKHOLDER AND
COMPANY CONCERNING COMPANY SHARES AND THE
AGREEMENT 17
Section 4.1 Enforceability 17
Section 4.2 Stock of Company 17
Section 4.3 Ownership of Company Shares 17
Section 4.4 No Broker 17
ARTICLE 5 REPRESENTATIONS AND WARRANTS OF WESTOWER AND SUB 18
Section 5.1 Westower's Organization and Authority 18
Section 5.2 Sub's Organization and Authority 18
ARTICLE 6 COVENANTS OF STOCKHOLDER AND COMPANY 19
Section 6.1 Access to Plant and Records 19
Section 6.2 Ordinary Course of Business 19
Section 6.3 Maintenance of Property 19
Section 6.4 No New Material Agreements 19
Section 6.5 Compensation 20
Section 6.6 Indebtedness 20
Section 6.7 No Securities Issued 20
Section 6.8 Repurchase; Dividends 20
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Section 6.9 Cooperation 20
Section 6.10 Covenant Not to Compete 20
ARTICLE 7 COVENANTS OF WESTOWER AND SUB 22
Section 7.1 Confidentiality 22
Section 7.2 ATR Acquisition 22
Section 7.3 Westower's Cooperation 22
ARTICLE 8 CONDITIONS PRECEDENT TO OBLIGATIONS OF STOCKHOLDER AND
COMPANY 23
Section 8.1 Westower's and Sub's Representations and Warranties 23
Section 8.2 Westower's and Sub's Delivery of Documents 23
Section 8.3 Other Approvals 23
Section 8.4 No Litigation 23
Section 8.5 Waivers and Consents Obtained 24
ARTICLE 9 CONDITIONS PRECEDENT TO WESTOWER'S AND SUB'S
OBLIGATIONS 24
Section 9.1 Representations and Warranties 24
Section 9.2 Stockholder and Company Delivery of Documents 24
Section 9.3 Other Approvals 24
Section 9.4 No Litigation 25
Section 9.5 Waivers and Consents Obtained 25
Section 9.6 ATR Acquisition 25
ARTICLE 10 INDEMNIFICATION 25
Section 10.1 Indemnification by Stockholder 25
Section 10.2 Notice of Asserted Claims by Third Parties 26
Section 10.3 Investigations; Waivers 27
ARTICLE 11 TERMINATION; WAIVER AND AMENDMENT 27
Section 11.1 Termination 27
Section 11.2 Waiver and Amendment 27
ARTICLE 12 MISCELLANEOUS 28
Section 12.1 Expenses 28
Section 12.2 Exhibits and Schedules Incorporated by Reference 28
Section 12.3 Notices 28
Section 12.4 Counterparts 29
Section 12.5 Party in Interest 30
Section 12.6 Entire Agreement; Writing Required to Amend 30
Section 12.7 Partial Invalidity 30
Section 12.8 Headings 30
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Section 12.9 Precedence of Documents 30
Section 12.10 Choice of Law; Forum Selection 30
Section 12.11 Enforcement Cost 31
Section 12.12 Stockholder Access to Books and Records 31
Section 12.13 Joint Approval of Press Release 31
Section 12.14 Survival 31
EXHIBIT A - Certificate of Merger
EXHIBIT B - Closing Certificate
EXHIBIT C - Matters to be Covered in Opinion of Counsel
for Stockholder and Company
EXHIBIT D - Closing Certificate
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LIST OF SCHEDULES
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Schedule 3.3 - Financial Statements
Schedule 3.4 - Undisclosed Liabilities
Schedule 3.5 - Dealings with Affiliates
Schedule 3.6 - Taxes
Schedule 3.7 - Contracts
Schedule 3.8 - Possible Claims
Schedule 3.9 - Customers and Suppliers
Schedule 3.10 - Certain Accounts Receivable
Schedule 3.12 - Liens
Schedule 3.13 - Conflicts
Schedule 3.14 - Governmental Authorizations
Schedule 3.15 - Claims, Administrative Actions and Lawsuits
Schedule 3.16 - Leases
Schedule 3.17 - Insurance
Schedule 3.18 - Absence of Certain Changes or Events
Schedule 3.20 - Environmental Liabilities
Schedule 3.22 - Employees, etc.
Schedule 3.24 - Compliance with Laws
Schedule 3.25 - Benefit Plans
Schedule 4.2 - Convertible Securities
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AGREEMENT OF MERGER
This Agreement of Merger is entered as of the 17th day of September 1998 by
and among, CNG COMMUNICATIONS, INC., a Delaware corporation ("Company"), PAUL
BISHOP ("Stockholder"), WESTOWER CORPORATION, a Washington corporation
("Westower"), and Westower CNG Acquisition Company, a Delaware corporation
("Sub").
RECITALS
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A. Stockholder is the owner of 4,000,000 shares of common stock, par
value $.001 per share of Company (the "Company Shares"). The Company Shares
represent all of the issued and outstanding capital stock of Company.
B. Sub is a wholly owned subsidiary of Westower. Westower and
Stockholder desire to cause Company to merge with and into Sub upon the terms
and conditions hereinafter set forth.
AGREEMENTS
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NOW, THEREFORE, in consideration of the foregoing recitals and of the
respective covenants, representations and agreements contained herein, it is
hereby covenanted and agreed by and among the parties that they shall carry out
and consummate the following Agreement of Merger (the "Agreement"):
ARTICLE 1
THE MERGER
SECTION 1.1 MERGER
Upon the filing of a Certificate of Merger with the Secretary of State of
the State of Delaware in the form attached to this Agreement as Exhibit A (the
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"Certificate of Merger"), Company shall be merged with and into Sub (the
"Merger"), the separate existence of Company shall cease, and Sub shall survive
as a corporation under the name "CNG Communications, Inc.," organized under and
governed by the laws of the State of Delaware. From that time, Sub shall
possess all the rights, privileges, immunities and franchises of each of Company
and Sub, all property belonging to Company shall be transferred to and vested in
Sub without further act or deed and Sub shall be responsible for all liabilities
of each of Company and Sub, all in the manner and with the effect set forth in
Sections 259 through 261 of the Delaware General Corporation Law, as amended
(the "DGCL").
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SECTION 1.2 SHARES OF COMPANY AND SUB
Upon the filing of the Certificate of Merger as set forth in Section 1.1:
(a) COMPANY SHARES
Each outstanding Company Share shall be converted into and become, and
the holder thereof shall have the right to receive, (i) immediately upon
surrender of the stock certificate therefor $.41798625 in cash (the amount
payable to the Stockholder to be converted to the nearest whole cent) and (ii)
the right to receive upon and subject to completion on or before March 31, 1999
of the purchase by Company of American Television Relay ("ATR") on the terms
provided in the letter of intent dated May 14, 1998 between Company and MCI
Telecommunications Corporation or other terms satisfactory to Westower, an
additional $.75 in cash; and
(b) SUB SHARES
Each outstanding share of Sub shall remain outstanding and be
unaffected by the Merger.
SECTION 1.3 CERTIFICATE OF INCORPORATION
The Certificate of Incorporation of Sub in effect immediately prior to the
Merger shall be amended to change the name of the corporation in Article 1
thereof to "CNG Communications, Inc.," and, as so amended, shall be the
Certificate of Incorporation of the surviving corporation until amended in
accordance with applicable law.
SECTION 1.4 BYLAWS
The Bylaws of Sub in effect immediately prior to the Merger shall be the
Bylaws of the surviving corporation until amended in accordance with applicable
law.
SECTION 1.5 DIRECTORS AND OFFICERS
The Board of Directors of the surviving corporation shall initially consist
of Calvin J. Payne, S. Roy Jeffrey and Paul Bishop, who shall hold office in
each case until their successors are elected and qualified. The initial
officers of the surviving corporation shall be:
Paul Bishop President
Calvin J. Payne Vice President
Peter Lucas Vice President, Treasurer and Secretary
Each officer shall hold office in accordance with the Bylaws of the
surviving corporation.
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ARTICLE 2
CLOSING AND CLOSING DOCUMENTS
SECTION 2.1 DATE, TIME AND PLACE OF CLOSING
The closing (the "Closing") of the Merger shall take place at 11:00 a.m.
Eastern time on September 23, 1998, or such other date as the parties may agree,
at the offices of Morgan, Lewis & Bockius LLP located at 2000 One Logan Square,
Philadelphia, Pennsylvania 19103, or at such other place as the parties mutually
agree upon. The date on which the Closing occurs is herein referred to as the
"Closing Date." On the Closing Date the Certificate of Merger shall be executed
and delivered by Sub and filed with the Secretary of State of Delaware. All
documents required to be delivered or actions to be taken at the Closing shall
be delivered or performed simultaneously, and no delivery shall be considered to
have been made and no action shall be considered to have been performed until
all such deliveries or actions have been completed. As used herein, the term
"Closing Documents" shall refer to all or any of the documents and certificates
enumerated in Section 2.2 and Section 2.3 below.
SECTION 2.2 STOCKHOLDER AND COMPANY CLOSING DOCUMENTS; DELIVERIES TO WESTOWER
AND SUB
At the Closing, Stockholder and Company shall deliver or cause to be
delivered to Westower and Sub the following documents (collectively, the
"Stockholder/Company Closing Documents"):
(a) STOCK CERTIFICATES
Certificates, executed in blank by Stockholder, or certificates
accompanied by assignment separate from certificate executed by Stockholder,
representing all of the Company Shares;
(b) COMPANY GOOD STANDING CERTIFICATES
Certificates issued by the Secretary of State of Delaware and
appropriate officers in the States of Arizona, Oklahoma and Texas indicating
that Company is duly incorporated or qualified to do business and in good
standing within such jurisdiction;
(c) STOCKHOLDER/COMPANY CERTIFICATE
A certificate signed by Stockholder and the Company dated as of the
Closing Date in the form attached as Exhibit B hereto. Such certificate, if and
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when delivered, shall for all purposes of this Agreement constitute an
additional representation and warranty of Stockholder and the Company to the
same extent as if made in this Agreement;
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(d) RESOLUTIONS AUTHORIZING TRANSACTION
A certificate dated as of the Closing Date signed by the Secretary of
Company evidencing all resolutions adopted by the Board of Directors of Company
and Stockholder and the incumbency of officers executing documents on behalf of
Company.
(e) OPINION OF COUNSEL
An opinion of Squire, Sanders & Dempsey L.L.P., counsel for
Stockholder and Company, dated as of the Closing Date, in form and substance to
Westower and its counsel, as to the matters set forth in Exhibit C hereto; and
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(f) OTHER INSTRUMENTS
Such other instruments as may be reasonably necessary or advisable and
reasonably required to effect the purposes hereof.
SECTION 2.3 WESTOWER AND SUB CLOSING DOCUMENTS: DELIVERIES TO STOCKHOLDER AND
COMPANY
At the Closing, Westower and Sub shall deliver or cause to be delivered to
Stockholder and Company the following documents (collectively, the "Westower/Sub
Closing Documents):
(a) WESTOWER/SUB CERTIFICATE
A certificate of Westower and Sub dated as of the Closing Date in the
form attached as Exhibit D hereto signed by authorized officers of Westower and
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Sub. Such certificate, if and when delivered, shall for all purposes of this
Agreement constitute an additional representation and warranty of Westower and
Sub to the same extent as if made in this Agreement;
(b) RESOLUTIONS AUTHORIZING TRANSACTION
Certificates dated as of the Closing Date signed by the Secretaries of
Westower and Sub evidencing all resolutions adopted by the Board of Directors of
Westower and Sub authorizing the transactions contemplated by this Agreement and
the incumbency of officers executing documents on behalf of Westower and Sub;
(c) MERGER CONSIDERATION
The Merger consideration payable to the Stockholder pursuant to
Section 1.2(a)(i).
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(d) OTHER INSTRUMENTS
Such other instruments as may be necessary or advisable and reasonably
required to effect the purposes hereof.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF STOCKHOLDER AND COMPANY
CONCERNING COMPANY
Stockholder and Company represent and warrant to Westower and Sub as
follows:
SECTION 3.1 ORGANIZATION AND AUTHORITY OF COMPANY
Company is a corporation duly incorporated, validly existing and in good
standing under the laws of the State of Delaware and has all requisite corporate
power and authority to own, operate and lease its properties and assets and to
carry on its businesses in the same manner as such businesses are now being
conducted. Company is qualified as a foreign corporation to do business in
Arizona, Texas and Oklahoma, which are the only other jurisdictions where it is
required to be so qualified and the failure to do so would have a material
adverse effect on its business, property or ability to conduct its business as
currently conducted.
SECTION 3.2 NO SUBSIDIARIES, PARTNERSHIPS AND JOINT VENTURES
Company owns no equity interest in any corporation, joint venture,
partnership or other entity.
SECTION 3.3 FINANCIAL STATEMENTS
Attached hereto as Schedule 3.3 is the July 31 Balance Sheet and the
statements of operations for the seven months then ended (collectively, the
"July 31 Financial Statements"), the balance sheets of Company at December 31 in
each of 1997 and 1996, and the related statements of operations and cash flows
of Company for each of the years then ended (collectively, the "Annual Financial
Statements"). The July 31 Financial Statements and the Annual Financial
Statements present fairly the financial position of Company at the respective
dates thereof, and the results of Company operations and cash flows for the
periods then ended, all in conformity with GAAP consistently applied (except as
to normal year-end accounting adjustments and the absence of footnotes for
interim statements and as set forth in Schedule 3.3).
SECTION 3.4 NO UNDISCLOSED LIABILITIES
Except as disclosed on Schedule 3.4 attached hereto, Company has no
liabilities or obligations of any nature whatsoever, whether absolute, accrued,
contingent, known or unknown and whether due or to become due, that were not
reflected on the July 31 Balance Sheet (except
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accrued expenses and accounts payable incurred by Company in the ordinary course
of business thereafter and obligations under contracts set forth on Schedule 3.7
or not required to be set forth therein and other liabilities that are not
material in scope or amount), and Stockholder does not know of any basis for
assertion against Company of any such liability or obligation.
SECTION 3.5 DEALINGS WITH AFFILIATES
Except for the contractual agreements as listed on Schedule 3.5 attached
hereto, Company does not have, directly or indirectly, any contractual
arrangements (including any express written employment agreements) with
Stockholder or any relative of Stockholder or any entity controlled by any of
them or any officer or director. Without limiting the generality of the
foregoing sentence, no affiliate, shareholder, officer, director or employee of
Company is, directly or indirectly, a joint investor or venturer with, or owner,
lessor, lessee, licenser or licensee of any real or personal property, tangible
or intangible, owned or used by Company or was or is a lender to or debtor of
Company.
SECTION 3.6 TAXES
Except as set forth on Schedule 3.6:
(a) Company has filed all Tax Returns (as hereinafter defined) that it
was required to file for all periods prior to the Closing Date. All such Tax
Returns were correct and complete all material respects. All Taxes (as
hereinafter defined) owed by Company (whether or not shown on any Tax Return)
have been paid or properly accrued. Company is not currently the beneficiary of
any extension of time within which to file any Tax Return. No claim has ever
been made by an authority in a jurisdiction where Company does not file Tax
Returns that it is or may be subject to taxation by that jurisdiction. There
are no liens on any of the assets of Company that arose in connection with any
failure (or alleged failure) to pay any Tax.
(b) Company has withheld and paid all Taxes required to have been
withheld and paid in connection with amounts paid or owing to any employee,
independent contractor or other third party.
(c) There is no dispute or claim concerning any Tax Liability of
Company either (1) claimed or raised by any authority in writing or (2) as to
which Stockholder or any employee responsible for Tax matters of Company has
knowledge. No Tax Returns filed with respect to Company have been audited or
currently are the subject of audit. Stockholder has delivered to Westower
correct and complete copies of all federal and state income Tax Returns filed by
Company since December 31, 1995 and all related examination reports and
statements of deficiencies, if any.
(d) Company has not waived any statute of limitations in respect of
Taxes or agreed to any extension of time with respect to a Tax assessment or
deficiency.
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(e) The unpaid Taxes of Company (i) did not, as of July 31, 1998,
exceed the reserve for Tax liability set forth on the face of the July 31
Balance Sheet and (ii) will not exceed the reserve on the Closing Date Balance
Sheet.
(f) Company made a valid election to be treated as an S corporation
within the meaning of Section 1361 of the Code ("S Corporation") for all years
from its incorporation through the year ended December 31, 1997, and such
election was revoked as of January 1, 1998.
(g) For purposes of this Agreement, "Tax" means any federal, state,
local, or foreign income, gross receipts, license, payroll, employment, excise,
severance, stamp, occupation, premium, windfall profits, environmental
(including taxes under Code section 59A), customs duties, capital stock,
franchise, profits, withholding, social security (or similar), unemployment,
disability, real property, personal property, sales, use, transfer,
registration, value added, alternative or add-on minimum, estimated, or other
tax of any kind whatsoever, including any interest, penalty, or addition
thereto, whether disputed or not.
(h) "Tax Return" means any return, declaration, report, claim for
refund, or information return or statement relating to Taxes, including any
schedule or attachment thereto, and including any amendment thereof.
SECTION 3.7 CONTRACTS
Schedule 3.7 attached hereto contains a true and complete list of all
contracts, agreements, arrangements and understandings, oral or written, to
which Company is a party or by which Company is bound which (a) could result in
an obligation of more than $50,000 to Company or which could result in receipt
of more than $50,000 by Company or (b) are between Company and Stockholder or
any relative of Stockholder or an entity controlled by Stockholder or any
relative of Stockholder, including, without limitation, all guaranties,
promissory notes and security agreements, license agreements, purchase and
supply agreements, and agreements relating to the borrowing of money. To
Stockholder's knowledge, except as set forth on such Schedule 3.7, all such
contracts are valid, binding and enforceable (except as the enforceability
thereof may be limited by bankruptcy, insolvency, reorganization or other
similar laws relating to the enforcement of creditors' rights generally and by
general principles of equity) in accordance with their terms against each party
thereto and are in full force and effect, Company has performed in all material
respects all obligations imposed on it thereunder, and, to Stockholder's
knowledge, no other party thereto is in default thereunder, nor is there any
event that with notice or lapse of time, or both, would constitute a default
thereunder. True and complete copies of each such contract entered into outside
the normal course of Company's business have been delivered to Westower.
Company has not received notice, nor is Company otherwise aware, that any party
to any such contract intends to cancel, terminate or refuse to renew such
contract or to exercise or decline to exercise any option or right thereunder.
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SECTION 3.8 FACTS GIVING RISE TO POSSIBLE CLAIMS/LITIGATION
Except as set forth on Schedule 3.8 attached hereto, to Stockholder's
knowledge, there are no facts that could furnish the basis for a valid claim
that could be brought against Company in litigation or arbitration.
SECTION 3.9 CUSTOMERS AND SUPPLIERS
Schedule 3.9 attached hereto sets forth (a) a complete and accurate list of
customers accounting for 5% or more of Company's revenues in any given fiscal
year during the past two fiscal years, showing the approximate total revenues
from each such customer during such periods and (b) a complete and accurate list
of Company's suppliers from whom Company purchased 5% or more of its goods or
services in any given year during the past two fiscal years.
SECTION 3.10 ACCOUNTS RECEIVABLE
Except as disclosed on Schedule 3.10 attached hereto, all accounts
receivable of Company reflected on the July 31 Balance Sheet are bona fide, have
arisen in the ordinary course of business and are collectible in full within 90
days without special collection efforts or litigation except for the allowance
for doubtful accounts set forth on the July 31 Balance Sheet. The July 31
Balance Sheet contains adequate provision for doubtful accounts set forth on the
July 31 Balance Sheet.
SECTION 3.11 CORPORATE BOOKS AND RECORDS
Company has furnished to Westower's representatives for their examination
true and complete copies of (a) Company's Certificate of Incorporation and
Bylaws as currently in effect, (b) Company's minute books, which books are
complete in all material respects, and (c) Company's stock transfer books. Such
minutes reflect all documented meetings of Company's shareholders and Board of
Directors and any committees thereof since Company's inception, and accurately
reflect in all material respects the events of and actions taken at such
meetings.
SECTION 3.12 TITLE TO PROPERTIES
Except as to liens disclosed on Schedule 3.12 attached hereto, Company
holds good title, free and clear of all mortgages, liens, pledges, charges and
encumbrances, to all the properties and assets reflected on the July 31 Balance
Sheet, except for (a) liens for current taxes not yet due and payable, (b) liens
described on Schedule 3.4, (c) the properties subject to those leases described
on Schedule 3.7 and (d) assets disposed of in the ordinary course of business
since the July 31 Balance Sheet.
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SECTION 3.13 CONFLICTS WITH INSTRUMENTS AND LAWS
Except as disclosed in Schedule 3.13 attached hereto, neither the execution
and delivery of this Agreement nor the consummation of the transactions
contemplated hereby nor compliance by Stockholder with any of the provisions
hereof will: (a) conflict with, or result in a breach or contravention of, or
in a default or the creation of any lien under, any of the terms, conditions or
provisions of any material note, bond, mortgage indenture, license, agreement or
other instrument or obligation (including without limitation Company' Articles
of Incorporation and By-laws) to which Company is a party or by which it or any
of its properties or assets may be bound, or (b) violate any statute, law,
regulation, order, writ, injunction or decree applicable to Company or any of
its or their properties or assets. No consent, approval or other action by any
governmental authority is required in connection with the execution, delivery
and performance by Stockholder of this Agreement.
SECTION 3.14 GOVERNMENTAL AUTHORIZATIONS
Except as set forth on Schedule 3.14 attached hereto, Company has all
licenses, permits, clearances and other authorizations from the United States
federal, state and local authorities as are necessary for the conduct of its
business and operations except where the failure to have such licenses, permits,
clearances, and other authorizations would not have a material adverse effect on
Company's financial position, results of operation or business.
SECTION 3.15 CLAIMS, ADMINISTRATIVE ACTIONS AND LAWSUITS
Except as disclosed in Schedule 3.15 attached hereto and except as to those
matters which have been finally settled or otherwise resolved prior to the date
hereof, Company is not aware of and has not been served with, any notice or
claim by any governmental agency, customer, employee or any other party
whatsoever relating to: (a) any infringement or misappropriation of any patent
or other intellectual property right in connection with performance of the
services provided by Company and/or any equipment manufactured or sold by
Company; (b) any environmental claim associated with operations of Company or
the ownership or operation of any property or properties by Company; (c) any
claim of non-compliance by Company under any occupational safety or health law;
(d) any negligence claims or errors and omissions claims with respect to any
services performed by Company or any goods or products sold by Company; (e) any
violation of any law or regulation or any term or condition of any permit or
license held by Company; (f) any workers' compensation statute and any other
applicable equal employment opportunity or discrimination, wage and hour,
collective bargaining agreement, wrongful discharge, personnel or other
employment related statutes, laws or common law rights of any type or
description; or (g) any other litigation of any type related in any way to the
business and operations of Company.
SECTION 3.16 LEASES; NO UNOWNED ASSETS UTILIZED
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Schedule 3.16 attached hereto sets forth the real property leases and
material personal property leases of Company. Other than the assets leased
pursuant to leases listed on Schedule 3.16, there are no other material assets
or properties necessary or utilized in the business and operations of Company
that are not owned by Company. All of the leases disclosed in Schedule 3.16
hereof are in full force and effect and no material breach or default of Company
or, to Stockholder's knowledge, by any other party thereto exists or has been
asserted with respect to any thereof, including but not limited to a failure on
the part of Company to pay any rents that have accrued and are payable under any
such leases.
SECTION 3.17 INSURANCE
Schedule 3.17 attached hereto is a list of all policies of fire, liability,
title and other forms of insurance held by Company and of all material claims
pending thereunder, copies of all of which have been made available to Westower.
Except as set forth on Schedule 3.17, all such policies or substantially
equivalent policies have been in force since Company commenced business and will
be in force on the Closing Date in accordance with their respective terms,
including without limitation, with respect to any insured losses resulting from
occurrences prior to the Closing Date. Company is not in material default with
respect to any provisions of any such policy and has not failed to give any
notice or failed to present any material claim thereunder, as to which it has
knowledge, in due and timely fashion.
SECTION 3.18 ABSENCE OF CERTAIN CHANGES OR EVENTS
Except as to matters disclosed in Schedule 3.18 attached hereto, since
December 31, 1997, as relates to Company, there has not been:
(a) any loss, damage or destruction in the nature of a casualty loss
or otherwise, whether covered by insurance or not, of any asset or assets, the
destruction of which, taken singly or in the aggregate is material to the
business and operations of Company;
(b) to the knowledge of Stockholder, the adoption, promulgation or
rescission of any statute, regulation, order, ordinance or other law, the
adoption, promulgation or rescission of which materially and adversely affects
any of the business and operations of Company as they are currently being
conducted;
(c) any failure to maintain the books and records of Company in the
usual, regular and ordinary manner and in accordance with good business practice
and GAAP;
(d) any declaration, setting aside or payment of any dividend, or
other distribution, in respect of any capital stock of Company or any direct or
indirect redemption, purchase or other acquisition of any capital stock of
Company by or on behalf of Company except a tax distribution on September 17,
1998 in the amount of $972,055;
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(e) any issuance or sale by Company of any of its stock, bonds or
other of its securities or obligations;
(f) any labor controversy or the threatening of any strike, work
stoppage or slowdown materially affecting the business or assets of Company;
(g) any sale, sale/leaseback transfer, or other disposition of any
asset of Company, other than agreements relating to the purchase and sale of
inventory and/or contract equipment entered into in the ordinary course of
business, or any sale, assignment, transfer or other disposition of any of its
material patents, trademarks, trade names, brand names, copyrights, licenses or
other intangible assets;
(h) any amendment, termination or waiver of any right of material
value belonging to Company;
(i) any increase in the compensation payable or to become payable by
Company to any of its officers, employees or agents, other than normal merit and
cost-of-living increases in accordance with the general prevailing practices of
Company existing prior to December 31, 1997;
(j) any changes with respect to Company's ordinary and customary
practices with respect to the invoicing of customers, the collection of any of
the accounts receivable, and payment of any accounts payable; or
(k) any material adverse change in the financial position, results of
operations, business or prospects of Company.
SECTION 3.19 REAL PROPERTY: BUSINESS LOCATIONS
Company has never owned any real property. All of the offices,
manufacturing facilities and/or warehouse facilities (collectively, the "Company
Facilities" and any of them singly a "Company Facility") currently maintained or
utilized by Company in the conduct of any of its business are and on the Closing
Date will be located on the leased properties described on Schedule 3.19 hereof.
Company has not, and to Stockholder's knowledge the owner of any of the Company
Facilities has not, heretofore received any notice of any pending condemnation
or similar proceeding or charge affecting the Company Facilities or any material
portion thereof, is not aware that any such proceeding or charge is contemplated
and has not received any notice of a proposed increase in assessed valuation of
any of the Company Facilities. The existing water, sewer, gas and electricity
lines, storm sewer and other utility systems on any of the Company Facilities
are adequate to serve the utility needs of such facilities for the business
purposes presently conducted thereon; there are no material structural defects
in any of the buildings or other improvements related to any of the Company
Facilities; the heating, electrical, plumbing and drainage at, or servicing each
of the Company Facilities and all facilities and equipment
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relating thereto are in working order, ordinary wear and tear excepted; Company
has received no notice that a default exists or breach exists and, to Company's
knowledge, no default or breach exists under any of the covenants, conditions,
restrictions, rights-of-way or easements affecting any real property associated
with any of the Company Facilities or any portion of any such facilities; and to
the Stockholder's knowledge no fact or condition exists which would result in
the termination of the current access from any of the Company Facilities to any
presently existing highways and roads adjoining or situated on any such
facilities.
SECTION 3.20 ENVIRONMENTAL LIABILITIES
Except as disclosed on Schedule 3.20 attached hereto, in the operation of
the business of Company at any time prior to the Closing Date, including but not
limited to the ownership or operation of any real properties, Company: (a) has
not been in material violation of any common law or any federal foreign, state
or local laws, regulations, statutes or ordinances relating to personal injury
arising out of Hazardous Substances (as such term is hereinafter defined) or
protection of the environment (collectively, the "Environmental Laws"); (b)
possesses all of the material permits, licenses, approvals and identification
numbers required under any Environmental Laws for the operation of each of the
Company Facilities in the manner in which any such facility is presently
operated; (c) is in compliance in all material respects with all permits,
licenses and approvals required by any of the Environmental Laws for the
operation of each of the Company Facilities in the manner in which each such
facility is currently being operate, except for such non-compliance as would not
be reasonably expected to lead to imposition of penalties or similar sanctions
by regulatory agencies; (d) is not aware of any conditions that will affect the
continued validity after the Closing Date of all such permits, licenses and
approvals required by any Environmental Laws for the operation of any of the
Company Facilities in the manner in which it is currently being operated; (e) is
not aware of the existence of any pending or threatened suits, proceedings,
investigations or claims with respect to sites of, or the operations conducted
at any of the Company Facilities relating to the enforcement of any
Environmental Laws or to determine the existence of any environmental
liabilities; (f) is not aware of the existence of any pending or threatened
suits, proceedings or claims by any third parties for damages or injunctive
relief arising out of the presence of any emissions, discharges, releases or
threatened releases, storage, transportation or the handling of pollutants,
contaminants, regulated wastes or hazardous wastes (collectively, the Hazardous
Substances) on or off the sites of any of the Company Facilities allegedly
caused, directly or indirectly, by the operations of Company at any such
facility; (g) is not aware of the existence of any citizen complaint relating to
the site of any of the Company Facilities or the operations of Company at any
such facility; (h) other than normal wear and tear on equipment that may alter
its performance, is not aware of any existing circumstances that may interfere
with the continued compliance with any existing permit, license or approval
required by statute or regulations for the operation of any of the Company
Facilities in the manner in which it is presently operated, except for such non-
compliance as would not be reasonably expected to lead to imposition of
penalties or similar sanctions by regulatory agencies; (i) is not aware of the
occurrence of any spill discharge, deposit or other release of any Hazardous
Substances, in excess of reportable
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quantities under Federal or state environmental laws and which has led or is
likely to lead to enforcement actions by governmental agencies, at any of the
Company Facilities caused, directly or indirectly, by Company; (j) is not aware
of any asbestos conditions at any of the Company Facilities; (k) is not aware of
any transformers, fixtures or other electrical equipment containing PCB's
installed in, affixed to or located at any of the Company Facilities; (l) is not
aware of any storage tanks for petroleum or hazardous substances located at any
of the Company Facilities, whether above ground, underground or within a
structure; (m) is not aware of any current or prior use of the premises of the
Company Facilities which would give rise to liability under any Environmental
Laws; and (n) is not aware of any potential liability under any Environmental
Laws arising out of any pre-Closing utilization of or operations at any of the
Company Facilities by Company or other third parties and has not been placed on
notice of any claim of any governmental agency or other regulatory body claiming
violation of any Environmental Laws or requiring any remediation or cleanup with
respect to any of the Company Facilities or requiring any change in the means or
methods of operation of any such facility.
SECTION 3.21 ABSENCE OF QUESTIONABLE PAYMENTS
Neither Company nor any of its directors, officers, agents, employees or
any other Person acting on behalf of Company has used any of Company's funds for
improper or unlawful contributions, payments, gifts or entertainment, or made
any unlawful expenditures relating to political activity to governmental
officials or others. Neither Company nor any of its current directors,
officers, agents, employees or any other Person acting on behalf of Company has
accepted or received any improper or unlawful contributions, payments, gifts or
expenditures. Company has at all times complied, and is in compliance, with the
applicable provisions of the U.S. Foreign Corrupt Practices Act, as amended, and
other applicable laws and regulations relating to corrupt practices and similar
matters.
SECTION 3.22 COMPANY'S EMPLOYEES
Schedule 3.22 attached hereto sets forth a list of each employee of
Company, their positions and rates of compensation. Except as disclosed on
Schedule 3.22 attached hereto, there are no outstanding claims for wages,
vacations, or other benefits or compensation of any type or description, whether
currently payable or deferred under any defined benefit pension plan, any
defined contribution pension plan, any implied or deemed employee benefit or
plan, or any welfare plan or otherwise or any other policy, program or practice,
whether formal or informal, by any of Company's employees or any other
individuals covered by or eligible under such plans or programs, other than
wages that will become due for current pay periods and/or benefits that have
accrued through the Closing Date and will become payable in the future. There
are no existing, or, to Stockholder's knowledge, threatened claims by any of
Company' employees with respect to any applicable Workers' Compensation, worker
health or safety, equal employment opportunity or discrimination, wage and hour,
wrongful discharge, personnel or other employment related statutes, laws or
common law rights of any type or description. Except as disclosed on Schedule
3.22 attached hereto, there is no collective bargaining agreement in
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existence between Company and a collective bargaining representative for any of
Company' employees, and during the one (1) year period immediately preceding the
date of this Agreement, there has not been any union organizing activities or
proceedings involving, or any petitions for election of or demands for
recognition by, a labor union or labor organization as the exclusive bargaining
agent for any of Company's employees. Company has not received notice of any
proceeding involving Company currently pending before the National Labor
Relations Board, including but not limited to any wherein a labor organization
is seeking representation of any of Company's employees.
SECTION 3.23 WARN
Company has not taken any action which may cause or have the effect of
causing any of the provisions of Worker Adjustment and Retraining Notification
Act to be applied or become applicable to Company.
SECTION 3.24 COMPLIANCE WITH LAWS
Except as provided in Schedule 3.24 attached hereto, Company has complied
in all material respects with and is currently complying in all material
respects with all applicable federal state and local statutes, regulations,
orders, ordinances and other laws material to the ownership and use of the
properties of Company, the utilization of any properties leased by Company and
the operation of the business of Company.
SECTION 3.25 EMPLOYEE BENEFIT PLANS
(a) BENEFIT PLANS
Schedule 3.25 attached hereto contains an accurate and complete list
of each bonus, deferred compensation, hospitalization or other medical, pension,
life or other insurance, profit sharing or retirement plan or arrangement, and
other employee benefit plan or arrangement maintained or contributed to by
Company, whether formal or informal and whether legally binding or not
(collectively, the "Plans"). Stockholder has heretofore delivered to Westower
true and complete copies of the documents governing all such plans or
arrangements as in effect on the date hereof. Company has no plan or
commitment, whether formal or informal and whether legally binding or not, to
create any additional such plan or arrangement or to modify or change any
existing plan or arrangement.
(b) PENSION AND WELFARE BENEFIT PLANS
Each of the Plans has been administered in compliance with its terms
and all filing, reporting, disclosure and other requirements of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA") and the
requirements of the Code have been satisfied with respect to each of the Plans.
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(c) WITHDRAWAL LIABILITY
No "withdrawal liability" (as that term is used in Section 4201 of
ERISA) has been or is reasonably expected to be assessed against Company, nor is
Company otherwise aware of any facts or circumstances that could lead to
assessment of withdrawal liability, nor has Company been notified by any multi-
employer plan (as that term is defined in Section 4001(a)(3) or ERISA) that such
multi-employer plan is in reorganization or insolvency within the meaning of
Section 4241 or Section 4245 of ERISA or that such multi-employer plan intends
to terminate or has terminated under Section 4041A of ERISA. Company has not
withdrawn, either partially or completely, from any multi-employer plans.
(d) NO PROHIBITED TRANSACTIONS
Neither any of the Plans nor any trust created thereunder, nor any
trustee or administrator thereof, has engaged in a "prohibited transaction" (as
such term is defined in Section 406 of ERISA) in connection with which any of
the Plans, any such trust, or any trustee or administrator thereof, or any party
dealing with the Plans or any such trust could be subject to either a civil
penalty assessed pursuant to Section 502(i) of ERISA or a tax imposed by Section
4975 of the Code.
(e) NO PBGC LIABILITY
Company is not aware and has received no notice that it has incurred
any liability to the Pension Benefit Guaranty Corporation ("PBGC") with respect
to any of the Plans or with respect to any other employee benefit plan
maintained or contributed to by Company that has been terminated or otherwise
discontinued prior to the date of this Agreement. The PBGC has not instituted
proceedings to terminate any of the Plans. Company has not received any notice
of and has no knowledge of a "reportable event" (within the meaning of Section
4043(b) of ERISA).
(f) FULL PAYMENT TO PLANS
Full payment has been made of all amounts which Company is required to
pay under the terms of each of the Plans as a contribution to the Plans as of
the last day of the most recent fiscal year of each of the Plans ended prior to
the date of this Agreement. None of the Plans nor any trust established
thereunder has incurred any "accumulated funding deficiency" (as defined in
Section 302 of ERISA and Section 412 of the Code), whether or not waived, as of
the last day of the most recent fiscal year of each of the Plans ended prior to
the date of this Agreement or the most recent contribution date as required
under the terms of any such Plans if later.
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(g) PLANS IN COMPLIANCE WITH LAWS
Each of the Plans is in compliance in all material respects with
applicable federal, state and local laws, including but not limited to ERISA.
Each of the Plans that is intended to be "qualified" has been administered in
accordance with the requirements of Section 401(a) of the Code, and a
determination letter has been received from the IRS with respect to
qualification of such Plans, and no facts or circumstances exist which would
adversely affect the qualified status of the Plans. Except as may be disclosed
on Schedule 4.25, no matter relating to any of the Plans is pending before any
court or governmental agency.
SECTION 3.26 FULL DISCLOSURE
No information furnished by Company to Westower in connection with this
Agreement (including, but not limited to, the July 31 Financial Statements and
the Annual Financial Statements and all information in the Schedules hereto) is
false or misleading in any material respect. Stockholder has not made any
untrue statement of a material fact or omitted to state a material fact
necessary in order to make the statements made or information delivered in or
pursuant to this Agreement not misleading.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF STOCKHOLDER AND COMPANY
CONCERNING COMPANY SHARES AND THE AGREEMENT
Stockholder and Company further represent and warrant to Westower as
follows:
SECTION 4.1 ENFORCEABILITY
Stockholder and Company have full power and authority to execute, deliver
and perform their obligations under this Agreement and to consummate the
transactions contemplated hereby. This Agreement has been duly executed and
delivered by Stockholder and Company and assuming due authorization, execution
and delivery by Westower and Sub, constitutes a legal, valid and binding
obligation of Stockholder and Company, enforceable against Stockholder and
Company in accordance with its terms, subject, as to enforceability, to laws
regarding bankruptcy and insolvency and equitable principles of general
application.
SECTION 4.2 STOCK OF COMPANY
The authorized capital stock of Company consists of 20,000,000 shares of
common stock, par value $.001 per share and 5,000,000 shares of preferred stock,
par value $.001 per share. The Company Shares constitutes all of the capital
stock of Company which is issued and outstanding, and the Company Shares are
validly issued and outstanding, fully paid and non-assessable. No person has,
or has ever had, any preemptive right to purchase or subscribe for any of the
capital stock of Company or any other securities of Company arising out of any
issuance or sale by
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Company of any shares of its authorized but unissued capital stock or any other
securities of Company prior to the Closing Date. Except as set forth in Schedule
4.2 hereof, there are no outstanding securities of Company which are convertible
into or exchangeable for any shares of its capital stock and there is no
existing contract, option, warrant, call or similar commitment of any character
granted or issued by Company calling for or relating to the issuance or transfer
of shares of capital stock or any other securities of Company.
SECTION 4.3 OWNERSHIP OF COMPANY SHARES
Stockholder owns and holds of record and beneficially Company Shares.
Stockholder has, and will convey to Westower hereunder, good title to Company
Shares free and clear of all claims, liens, charges and encumbrances of any
nature whatsoever.
SECTION 4.4 NO BROKER
Neither Stockholder nor Company has utilized the services of any broker in
arranging for the transactions contemplated by this Agreement. There are no
investment bankers, brokers or other like entities that have a valid claim from
Company or Westower or Sub any broker's, finder's, or like fee on account of
services performed for Stockholder or Company in connection with the
consummation of the transactions contemplated by this Agreement.
ARTICLE 5
REPRESENTATIONS AND WARRANTS OF WESTOWER AND SUB
Westower and Sub represent and warrant to Stockholder as follows:
SECTION 5.1 WESTOWER'S ORGANIZATION AND AUTHORITY
Westower is a corporation duly incorporated, validly existing and is in
good standing under the laws of the State of Washington. Westower has the full
corporate power and authority to execute and deliver this Agreement and carry
out and perform its undertakings and obligations under this Agreement and each
of the Westower/Sub Closing Documents. The execution and delivery by Westower
of this Agreement and the consummation by Westower of the transactions
contemplated in this Agreement, including the execution and performance of each
of the Westower/Sub Closing Documents, have been duly authorized by all proper
and requisite proceedings and will not conflict with or breach any provision of
any agreement or other instrument (including Westower's Articles of
Incorporation and By-laws) to which Westower is a party or by which it or its
properties or assets is bound. This Agreement has been, and each of the
Westower/Sub Closing Documents will be, duly and validly executed and delivered
by Westower. Assuming due authorization, execution and delivery by Stockholder
and Company, this Agreement is, and each of the Westower/Sub Closing Documents
will be, the legal valid and binding obligation of Westower, enforceable against
it in accordance with their respective terms, subject, as to enforceability, to
bankruptcy and other equitable principles.
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SECTION 5.2 SUB'S ORGANIZATION AND AUTHORITY
Sub is a corporation duly incorporated, validly existing and is in good
standing under the laws of the State of Delaware. Sub has the full corporate
power and authority to execute and deliver this Agreement and carry out and
perform its undertakings and obligations under this Agreement and each of the
Westower/Sub Closing Documents. The execution and delivery by Sub of this
Agreement and the consummation by Sub of the transactions contemplated in this
Agreement, including the execution and performance of each of the Westower/Sub
Closing Documents, have been duly authorized by all proper and requisite
proceedings and will not conflict with or breach any provision of any agreement
or other instrument (including Sub's Certificate of Incorporation and By-laws)
to which Sub is a party or by which it or its properties or assets is bound.
This Agreement has been, and each of the Westower/Sub Closing Documents will be,
duly and validly executed and delivered by Sub. Assuming due authorization,
execution and delivery by Stockholder and Company, this Agreement is, and each
of Westower Closing Documents will be, the legal valid and binding obligation of
Sub, enforceable against it in accordance with their respective terms, subject,
as to enforceability, to bankruptcy and other equitable principles.
ARTICLE 6
COVENANTS OF STOCKHOLDER AND COMPANY
Except as to the covenants in Sections 6.10, which applies to Stockholder
only post-Closing, Stockholder and Company hereby covenant and agree that from
the date hereof to the Closing Date that, except for transactions expressly
authorized by this Agreement, including transactions consented to in writing by
Westower, they will comply with the following:
SECTION 6.1 ACCESS TO PLANT AND RECORDS
Company will afford to the authorized representatives of Westower such
access during regular business hours to the properties, books and records of
Company as Westower may from time to time reasonably request by prior notice.
SECTION 6.2 ORDINARY COURSE OF BUSINESS
Company will operate its business substantially as now operated and only in
the ordinary course, and, to the extent consistent with such operation, it will
use its best efforts to preserve intact its present business organization, to
keep available the services of its present officers and key employees and to
preserve its relationships with persons having business dealings with it.
Company will maintain its or their books, accounts and records in the usual,
regular and ordinary manner in conformity with GAAP.
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SECTION 6.3 MAINTENANCE OF PROPERTY
Company will maintain all of its assets in customary repair, order and
condition, reasonable wear and use and damage by unavoidable casualty excepted,
and take all steps necessary to maintain its intangible assets, including
without limitation, its patents, trademarks, tradenames, brand names, copyrights
and any pending applications therefor.
SECTION 6.4 NO NEW MATERIAL AGREEMENTS
Company will not enter into any material leases, sale/leaseback
transactions, agreements for the purchase of fixed assets, exclusive services
agreements, or other material agreements, other than agreements relating to the
purchase and sale of inventory and/or contract equipment in the ordinary course
of business.
SECTION 6.5 COMPENSATION
Company will not: (a) grant any increase in compensation other than normal
merit and cost-of-living increases in accordance with Company' general
prevailing practices existing prior to the date of this Agreement to any
officer, employee or agent, or (b) enter into or amend any bonus, incentive
compensation, deferred compensation, profit sharing, retirement, pension, group
insurance, death benefit or other fringe benefit plan, trust agreement, or
arrangement, or any employment, compensation or consulting agreement except as
required by law.
SECTION 6.6 INDEBTEDNESS
Company will not create, incur, assume guarantee or otherwise become liable
with respect to any indebtedness for money borrowed or voluntarily create,
incur, assume or guarantee any other indebtedness or obligation other than in
the ordinary course of business.
SECTION 6.7 NO SECURITIES ISSUED
Company will not issue any shares of its capital stock or enter into any
contract, or grant any option, warrant or right, calling for the issuance of any
shares, and will not create any securities convertible into any such shares or
convertible into securities in turn so convertible, or enter into any contract,
or grant any option, warrant or right, calling for the issuance of any such
convertible security.
SECTION 6.8 REPURCHASE; DIVIDENDS
Company will not redeem, repurchase or otherwise acquire any capital stock
of Company, or declare or pay any dividend in cash, securities or other
property.
SECTION 6.9 COOPERATION
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Stockholder will cooperate and will cause Company to cooperate fully with
Westower in promptly taking any and all action or executing any and all
documents appropriate to consummate the transactions contemplated by this
Agreement.
SECTION 6.10 COVENANT NOT TO COMPETE
(a) Stockholder agrees that for a period ending on the later of the
expiration of three (3) years after the Closing Date or two (2) years after the
date of termination of his employment with Sub for any reason, except for
termination by Sub without cause, Stockholder will not, except as expressly
permitted hereunder, directly or indirectly (i) operate, develop or own any
interest other than the ownership of less than 5% of the equity securities of a
publicly traded company in any business engaged in the wireless communications
industry or communications tower construction industry that is directly
competitive with Westower's business as presently conducted (a "Business"); (ii)
compete with Westower, Sub or their subsidiaries and affiliates in the operation
or development of any Business within North America (Canada, Mexico, and the
United States of America); (iii) with the exception of Sub, be employed by any
business which owns, manages, or operates a Business; (iv) interfere with,
solicit, disrupt or attempt to disrupt any past, present or prospective
relationship, contractual or otherwise, between Sub, or its subsidiaries or
affiliates, and any customer, client, supplier or employee of Sub, or its
subsidiaries or affiliates; or (v) solicit any employee of Sub, or its
subsidiaries or affiliates, to leave their employment with Sub or its
subsidiaries or affiliates, as the case may be, or hire any such employee to
work for a Business. Stockholder shall not be entitled to circumvent the
provisions of this Section 6.10 by entering into a relationship with a Business
as a consultant, director, advisor, or otherwise, which has the effect of
competing with Sub, its affiliates or subsidiaries.
(b) If a judicial determination is made that any of the provisions of
Section 6.10(a) constitute an unreasonable or otherwise unenforceable
restriction, such provisions shall be rendered void only to the extent that such
judicial determination finds such provisions to be unreasonable or otherwise
unenforceable. In this regard, the parties hereto hereby agree that any
judicial authority construing this Agreement shall be empowered to sever any
portion of the territory or prohibited business activity from the coverage of
Section 6.10(a) and to apply the provisions of Section 6.10(a) to the remaining
portion of the territory or the remaining business activities not so severed by
such judicial authority. The time period during which the prohibitions set
forth in Section 6.10(a) shall apply shall be tolled and suspended during all
violations of Section 6.10(a).
(c) Stockholder specifically acknowledges and agrees that the
restrictions set forth in this Section 6.10 are reasonable and necessary to
protect the legitimate interests of Westower and Sub and that Westower and Sub
would not have undertaken the Merger in the absence of such restrictions.
Stockholder further acknowledges and agrees that any violation of the provisions
of this Section 6.10 will result in irreparable injury to Westower and Sub, that
the
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remedy at law for any violation or threatened violation of such Section will
be inadequate and that in the event of any such breach, Westower or Sub, in
addition to any other remedies or damages available at law or in equity, shall
be entitled to temporary injunctive relief before trial from any court of
competent jurisdiction as a matter of course and to permanent injunctive relief
without the necessity of proving actual damages. The existence of any claim or
cause of action on the part of Stockholder against Westower or Sub, whether
arising from this Agreement or otherwise, shall not constitute a defense to the
granting or enforcement of this injunctive relief. If Westower or Sub is
required to enforce any of its rights under this Agreement, Westower or Sub
shall be entitled to recover from Stockholder all reasonable attorneys' fees,
court costs and other expenses incurred by Westower or Sub in connection with
the enforcement of those rights.
ARTICLE 7
COVENANTS OF WESTOWER AND SUB
Westower and Sub hereby covenant and agree:
SECTION 7.1 CONFIDENTIALITY
Westower and Sub agree that they will maintain in confidence and neither
disclose to any third party nor make commercial use of all or any part of any
information disclosed by Stockholder or Company in connection with the
transactions contemplated hereunder; provided, however, that the obligations
contained in this Section shall not apply to such portions of such information
which were known to Westower or Sub without obligation of confidentiality prior
to disclosure to Westower or Sub by Stockholder or Company, as the case may be,
as demonstrated by competent documentary evidence in Westower's or Sub's
possession, or which properly became available to Westower or Sub, under
conditions which do not restrict further disclosure, from a third party source
who shall not have obtained such information either directly or indirectly from
Stockholder or Company or which now or hereafter comes into the public domain
without fault on the part of Westower, or its employees. With respect to
information disclosed to Westower or Sub related to the business and operations
of Company, the foregoing obligation of confidentiality shall apply prior to the
Closing of the transactions contemplated by this Agreement, or, if no such
Closing takes place, for a period of two (2) years from the date of this
Agreement.
SECTION 7.2 ATR ACQUISITION
Westower and Sub will cooperate with Stockholder and use all reasonable
efforts to complete the acquisition of ATR, including making available to Sub
the unpaid purchase price set forth in the letter of intent referred to in
Section 2.2 hereof; provided, however, that the results of the continuing due
diligence of ATR and the terms of the definitive purchase agreement and
information on the disclosure schedules to be furnished by MCI are acceptable to
Westower in its sole discretion.
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SECTION 7.3 WESTOWER'S COOPERATION
Westower will cooperate fully with Stockholder and Company in promptly
taking any and all action or executing any and all documents appropriate to
consummate the transactions contemplated by this Agreement.
ARTICLE 8
CONDITIONS PRECEDENT TO OBLIGATIONS OF STOCKHOLDER
AND COMPANY
The obligations of Stockholder and Company to consummate the transactions
provided for in this Agreement are, at the option of Stockholder, subject to
satisfaction of the following conditions on or before the Closing Date:
SECTION 8.1 WESTOWER'S AND SUB'S REPRESENTATIONS AND WARRANTIES
All the covenants, terms and conditions of this Agreement to be complied
with or performed by Westower or Sub on or before the Closing Date shall have
been complied with and performed in all material respects. The representations
and warranties made by Westower and Sub in this Agreement shall be true and
correct in all material respects at and as of the Closing Date with the same
force and effect as though such representations and warranties had been made at
and as of the Closing Date, except that any representation or warranty that by
its terms is made with reference to a specific date shall have been correct in
all material respects as of such date. A representation or warranty that is
expressly subject to a materiality limitation shall not be subject to a further
materiality limitation as a result of the use of the phrase "in all material
respects" in the preceding sentence.
SECTION 8.2 WESTOWER'S AND SUB'S DELIVERY OF DOCUMENTS
Westower and Sub shall have duly executed and delivered, or caused to be
executed and delivered, to Stockholder, this Agreement and the Westower/Sub
Closing Documents.
SECTION 8.3 OTHER APPROVALS
All authorizations, consents, orders or approvals of any United States
federal or state governmental agency necessary for the consummation of the
Merger or the transactions contemplated hereby (other than such actions,
approvals or filings which, pursuant to the terms of this Agreement, are to take
place on or after the Closing) shall have been filed, occurred or been obtained.
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SECTION 8.4 NO LITIGATION
No administrative investigation, action, suit or proceeding seeking to
enjoin the consummation of the transactions contemplated under this Agreement
shall be pending or threatened.
SECTION 8.5 WAIVERS AND CONSENTS OBTAINED
Westower and Sub shall have obtained all such consents, waivers, orders and
approvals as may be necessary so as to cure, resolve or otherwise avoid any
conflict, breach or default, lien creation or violation that would have been
caused by consummation of the transactions contemplated hereunder had such
consents, waivers, orders and approvals not been obtained.
ARTICLE 9
CONDITIONS PRECEDENT TO WESTOWER'S AND SUB'S OBLIGATIONS
The obligation of Westower and Sub to consummate the transactions provided
for in this Agreement are, at the option of Westower and Sub, subject to
satisfaction of the following conditions on or before the Closing Date:
SECTION 9.1 REPRESENTATIONS AND WARRANTIES
All the covenants, terms and conditions of this Agreement to be complied
with or performed by Stockholder and Company on or before the Closing Date shall
have been complied with and performed in all material respects. The
representations and warranties made by Stockholder and Company in this Agreement
shall be true and correct in all material respects at and as of the Closing Date
with the same force and effect as though such representations and warranties had
been made at and as of the Closing Date, except that any representation or
warranty that by its terms is made with reference to a specific date shall have
been correct in all material respects as of such date. A representation or
warrant that is expressly subject to a materiality limitation shall not be
subject to a further materiality limitation as a result of the use of the phrase
"in all material respects" in the preceding sentence.
SECTION 9.2 STOCKHOLDER AND COMPANY DELIVERY OF DOCUMENTS
Stockholder and Company shall have duly executed and delivered, or caused
to be executed and delivered, to Westower this Agreement and Stockholder/Company
Closing Documents.
SECTION 9.3 OTHER APPROVALS
All authorizations, consents, orders or approvals of any United States
federal or state governmental agency necessary for the consummation of the
Merger or the transactions
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contemplated hereby (other than such actions, approvals or filings which,
pursuant to the terms of this Agreement, are to take place on or after the
Closing) shall have been filed, occurred or been obtained.
SECTION 9.4 NO LITIGATION
No administrative investigation, action, suit or proceeding seeking to
enjoin the consummation of the transactions contemplated under this Agreement
shall be pending or threatened.
SECTION 9.5 WAIVERS AND CONSENTS OBTAINED
Stockholder shall have obtained all such consents, waivers, orders and
approvals related to those matters listed on Schedule 3.13 hereof, as may be
necessary so as to cure, resolve or otherwise avoid any conflict, breach or
default, lien creation or violation that would have been caused by consummation
of the transactions contemplated hereunder had such consents, waivers, orders
and approvals not been obtained.
SECTION 9.6 ATR ACQUISITION
The letter of intent to acquire ATR shall be in full force and effect, the
due diligence concerning ATR conducted by Company and the status of negotiations
between Company and ATR shall be satisfactory to Westower.
ARTICLE 10
INDEMNIFICATION
SECTION 10.1 INDEMNIFICATION BY STOCKHOLDER
Subject to consummation of the Closing and the further provisions of this
Section 10.1, Stockholder hereby agrees to indemnify and hold Westower, its
subsidiaries (including Sub), parents, affiliates, officers, directors, agents
and employees (collectively, the "Westower Indemnified Parties") harmless from
and against and with respect to any Damages to any Westower Indemnified Parties
as hereinafter defined, provided that: (a) Stockholder has received notice from
Westower of a claim for indemnification under this Section with respect to the
matters covered by Section 3.6 prior to the expiration of the applicable statute
of limitations with respect to such matters and (b) Stockholder have received
notice from Westower of a claim for indemnification under Section 10.2 with
respect to all other matters within two (2) years from the Closing Date. The
term "Damages," as used herein, shall include any claim, action, loss, cost,
expense, liability, penalty or interest or damage, including, without
limitation, reasonable counsel fees, and all reasonable costs and expenses of
all actions, suits, proceedings, demands, assessments, claims and judgments
resulting from, occurring in connection with, or arising out of
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any breach of any representation, warranty or covenant by Stockholder or Company
made in the Agreement or in any of Stockholder/Company Closing Documents.
Notwithstanding anything to the contrary set forth in this Agreement, with
respect to claims for indemnification pursuant to this Section 10.1, Westower
Indemnified Parties will not be entitled to any indemnification, defense or
holding harmless, from Stockholder, and Stockholder will not be required to
indemnify, defend or hold harmless any of the Westower Indemnified Parties, for
any Damages arising out of breach of any representation or warranty unless and
until, and only to the extent that, such claims exceed One Hundred Thousand
Dollars ($100,000) in the aggregate, at which time Stockholder shall be liable
for all such Damages in excess of the first $100,000 and the maximum liability
of the Stockholder for Damages arising out of breach of any representation or
warranty shall not exceed the Merger consideration paid to Stockholder.
The representations and warranties of Stockholder and Company herein
contained shall survive the Closing (y) with respect to matters covered by
Section 3.6 of this Agreement, solely for the period ending on the expiration of
the applicable statutes of limitations, and (z) with respect to all other
representations and warranties contained in Article 3 and 4 of this Agreement,
solely for a period of two (2) years from the Closing Date.
The rights of the Westower Indemnified Parties under this Article 10 shall
be their exclusive remedy with respect to any claim for Damages; provided,
however, that the foregoing clause of this sentence shall not be deemed a waiver
by any party to this Agreement of any of its rights or remedies arising by
reason of any claim of fraud.
SECTION 10.2 NOTICE OF ASSERTED CLAIMS BY THIRD PARTIES
If any claim or assertion of liability is made or asserted by a third party
against a Westower Indemnified Party based on any liability or obligation which,
if established, would entitle the Westower Indemnified Party to indemnification
by Stockholder, such Westower Indemnified Party shall with reasonable promptness
give to Stockholder written notice of the claim or assertion of liability and
request Stockholder defend the same, attaching to such notice copies of any
documents evidencing such claim which the Westower Indemnified Party has
received. Failure to so notify Stockholder shall not relieve Stockholder of any
liability that Stockholder might have to a Westower Indemnified Party. Within
ten (10) days after such notice shall have been given, Stockholder shall in
writing advise the Westower Indemnified Party whether they elect to defend
against such claim. The failure of Stockholder to give such advice within such
ten (10) period shall be deemed an election not to defend against such claim.
In the event that such advice of election to defend is given within such ten
(10) day period, then Stockholder shall have the right to defend, at its
expense, actively and in good faith against such claim with counsel of their own
choice, which counsel choice shall be subject to the reasonable approval of
Westower, including, without limitation, the right to settle and compromise such
claim and to take such appeals as may be necessary or desirable in connection
therewith. The
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Westower Indemnified Parties shall cooperate and assist in the defense of such
claim, to the extent reasonably requested by Stockholder and, in the event that
the Westower Indemnified Parties desire additional counsel, they may retain such
counsel as they may select at their expense. Counsel selected by Stockholder and
the Westower Indemnified Parties shall consult with and advise each other, but
the control of all such litigation, including the compromise or settlement
thereof and the taking of appeals, shall be determined by counsel for
Stockholder.
SECTION 10.3 INVESTIGATIONS; WAIVERS
The right of the Westower Indemnified Parties to the indemnification
provided in this Article 10 shall remain in effect notwithstanding any
investigation at any time by or on behalf of Westower hereto or any waiver by
Westower hereto of any condition to Westower's obligations to consummate the
transactions contemplated hereby.
ARTICLE 11
TERMINATION; WAIVER AND AMENDMENT
SECTION 11.1 TERMINATION
This Agreement may be terminated in any one of the following ways:
(a) At any time on or prior to the Closing Date by the mutual consent
in writing of the parties hereto; or
(b) On the Closing Date: (i) by Stockholder and Company, in writing,
if the conditions set forth in Article 8 above hereof shall not have been met;
or (ii) by Westower and Sub, in writing, if the conditions set forth Article 9
above shall not have been met; or,
(c) By Stockholder and Company or Westower and Sub if the Closing
shall not have occurred on or prior to September 30, 1998.
SECTION 11.2 WAIVER AND AMENDMENT
(a) The parties hereto may at any time extend the time for the
performance of any of the obligations or other acts of any other party hereto
and may waive, with respect to such other party, (i) any inaccuracies in the
representations and warranties contained in this Agreement or in any document
delivered pursuant hereto, (ii) compliance with any of the covenants,
undertakings or agreements, or satisfaction of any of the conditions to its
obligations, contained in this Agreement, or (iii) the performance (including
performance to the satisfaction of a party) of any obligation set out herein.
Any waiver by any party of a condition to its obligation to perform this
Agreement and the subsequent Closing hereunder shall be in writing and shall be
without prejudice to the rights or remedies it may have arising out of any
subsequent
26
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or different breach of the same or any other any representation, warranty,
covenant or other agreement hereunder.
(b) The provisions of this Agreement may not be changed, modified or
amended except by way of a writing duly executed by each of the parties hereto.
ARTICLE 12
MISCELLANEOUS
SECTION 12.1 EXPENSES
Each party shall pay its own expenses for the preparation and execution of
this Agreement and in connection with the transactions contemplated hereby,
whether or not this Agreement goes to Closing or terminates pursuant to the
provisions of Article 12 hereof. Following the Closing, in the event that
Company receives any bills or invoices for expenses that Stockholder has agreed
to pay pursuant to the provisions of this Section 12.1, then Westower shall
promptly forward such bills or invoices to Stockholder. Stockholder will make
payment of such bills or invoices promptly and in accordance with their terms of
payment.
SECTION 12.2 EXHIBITS AND SCHEDULES INCORPORATED BY REFERENCE
All exhibits and schedules to this Agreement referenced in this Agreement
are, by such reference, incorporated herein.
SECTION 12.3 NOTICES
Any notice, request, instruction or other document to be given hereunder by
any party or parties hereto to the other parties will be effective upon receipt
by the other parties if given in writing, delivered personally, mailed by
registered or certified mail, postage paid, sent by commercial overnight
delivery service, fees prepaid, or sent by confirmed facsimile transmission to
the following addresses or facsimile transmission numbers:
(a) If to Stockholder or Company, addressed to:
Paul Bishop
CNG Communications, Inc.
3661 N. Campbell Ave., #20
Tucson, AZ 85719
Facsimile Transmission Number: 520-318-9120
Confirmation Number: 800-982-6290
With a courtesy copy to:
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Christopher D. Johnson, Esquire
Squire, Sanders & Dempsey L.L.P.
Two Renaissance Square
40 N. Central Avenue, Suite 2700
Phoenix, AZ 85003
Facsimile Transmission Number: 602-253-8129
Confirmation Number: 602-528-4000 (ext. 4211)
(b) If to Westower, addressed to:
Mr. Peter Lucas
Westower Corporation
2653 151 Place NE
Redmond, WA 98052
Facsimile Transmission Number: 604-576-4855
Confirmation Number: 604-576-4755
With a courtesy copy to:
Peter S. Sartorius, Esquire
Morgan, Lewis & Bockius LLP
2000 One Logan Square
Philadelphia, PA 19103-6993
Facsimile Transmission Number: 215-963-5299
Confirmation Number: 215-963-5560
Failure to send a courtesy copy of any notice as provided above shall not make
the provision of such notice defective. Any party hereto may direct in writing
that notices or courtesy copies thereof be sent to other or additional addresses
by like notice.
SECTION 12.4 COUNTERPARTS
This Agreement may be executed in one or more counterparts, each of which
shall be deemed to be an original instrument, but all of which together shall
constitute but one instrument. Confirmation by electronic transmission of a
facsimile signature page shall be binding on any party so confirming.
28
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SECTION 12.5 PARTY IN INTEREST
This Agreement is made solely for the benefit of Westower and Stockholder,
and no other person, partnership, trust association or corporation shall acquire
or have any right under or by virtue of this Agreement. This Agreement shall be
binding on the parties hereto and their respective successors, heirs and
assigns.
SECTION 12.6 ENTIRE AGREEMENT; WRITING REQUIRED TO AMEND
This Agreement, including the Schedules hereto, constitutes the entire
agreement among the parties with respect to the subject matter hereof and
supersedes all prior agreements and understandings of the parties in connection
therewith. No covenant or condition not expressed in this Agreement shall
affect or be effective to interpret, change or restrict this Agreement.
SECTION 12.7 PARTIAL INVALIDITY
If any term, provision, covenant or condition of this Agreement is held by
any court of competent jurisdiction to be invalid, void or unenforceable, the
remainder of the provisions hereof shall continue in full force and effect.
SECTION 12.8 HEADINGS
The sections headings provided in this Agreement are for convenience only
and are in no way intended to affect the meaning or import of any of the
language contained in this agreement.
SECTION 12.9 PRECEDENCE OF DOCUMENTS
In the event that there is a conflict between the terms of this Agreement
and any other agreement, document, instrument and writing executed or entered
into by any of the parties hereto with respect to any of the transactions
contemplated by this Agreement, the terms and conditions of this Agreement shall
take precedence.
SECTION 12.10 CHOICE OF LAW; FORUM SELECTION
This Agreement shall be governed by and construed according to the laws of
the State of Washington. The federal and state courts located in King County,
State of Washington, shall have the exclusive jurisdiction over any dispute
under this Agreement, and each of the undersigned consents to personal
jurisdiction in such court.
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SECTION 12.11 ENFORCEMENT COST
If any civil action, arbitration, or other legal proceeding is brought for
the enforcement of this Agreement, or because of an alleged dispute, breach,
default, or misrepresentation in connection with any provision of this
Agreement, the successful or prevailing party shall be entitled to recover
reasonable attorneys' fees, court cost and expenses incurred in that civil
action, arbitration or legal proceeding, in addition to any other relief to
which such party may be entitled.
SECTION 12.12 STOCKHOLDER ACCESS TO BOOKS AND RECORDS
Within 10 days of receipt of notice in writing of any audit of, or
deficiency notice to, Company or Stockholder which Westower receives with
respect to Taxes for periods ending on or prior to the Closing Date, Westower
will furnish a copy of such notice to Stockholder. Westower shall cooperate with
and give Stockholder reasonable access during normal business hours on advance
notice to the records of Company for the period under examination and shall use
its best efforts to furnish any other documents or instruments necessary to
enable Stockholder's representatives to properly defend the audit, deficiency or
other proceedings. If Stockholder exercise its right to prepare and prosecute a
tax refund claim, Westower will give Stockholder reasonable access to the
records of Company and any other documents and instruments necessary to enable
Stockholder's representatives to properly prepare and prosecute the refund
claim.
SECTION 12.13 JOINT APPROVAL OF PRESS RELEASE
Except as otherwise required by applicable securities laws, all press
releases and public announcements related to this Agreement and the transactions
contemplated thereby must be approved in advance by Westower and Stockholder.
SECTION 12.14 SURVIVAL
Without limiting of any other provision hereof, all provisions of this
Agreement which by their terms require or may require performance after the
Closing shall survive the Closing and for such period following the Closing as
may be required for Westower, Company or Stockholder, as the case may be, to
fulfill their respective obligations thereunder; such provisions shall terminate
by their terms thereafter.
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IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the
date set forth above.
CNG COMMUNICATIONS, INC.
By:/s/ Paul Bishop
-----------------------------
Paul Bishop
President
/s/ Paul Bishop
-----------------------------
PAUL BISHOP
WESTOWER CORPORATION
By:/s/ Calvin J. Payne
-----------------------------
Calvin J. Payne
Chairman of the Board
WESTOWER CNG ACQUISITION COMPANY
By:/s/ Calvin J. Payne
-----------------------------
Calvin J. Payne
President
31
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EXHIBIT A
CERTIFICATE OF MERGER
The undersigned, Westower CNG Acquisition Company, a Delaware
corporation, is executing this Certificate of Merger in accordance with Section
251 of the Delaware General Corporation Law and hereby certifies as follows:
1. The name and state of incorporation of each of the constituent
corporations are:
Name State of Incorporation
- ---------------------------------- ----------------------
CNG Communications, Inc. Delaware
Westower CNG Acquisition Company Delaware
2. An Agreement of Merger has been approved, adopted, certified,
executed and acknowledged by each of the constituent corporations in accordance
with Section 251 of the Delaware General Corporation Law.
3. Westower CNG Acquisition Company is the surviving corporation,
and the name of such corporation shall be changed as provided in paragraph 4
below.
4. Paragraph FIRST of the Certificate of Incorporation of the
surviving corporation shall be amended as set forth below, and as so amended
shall be the Certificate of Incorporation of the surviving corporation:
"FIRST: The name of the corporation is CNG Communications, Inc."
5. A copy of the executed Agreement of Merger is on file at the
office of the surviving corporation located at:
c/o Westower Corporation
7001 N.E. 40th Ave.
Vancouver, WA 98661
6. A copy of the Agreement of Merger will be furnished by the
surviving corporation, on request and without cost, to any stockholder of either
constituent corporation.
A-1
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IN WITNESS WHEREOF, this Certificate of Merger has been executed
this ___ day of September 1998.
WESTOWER CNG ACQUISITION COMPANY
By:
-----------------------------------
Calvin J. Payne
President
A-2
<PAGE>
EXHIBIT B
CLOSING CERTIFICATE
The undersigned, Paul Bishop (the "Stockholder") and CNG
Communications, Inc., a Delaware corporation (the "Company"), hereby certify in
connection with the transactions contemplated by the Agreement of Merger, dated
as of September 17, 1998, by and among the Company, the Stockholder, Westower
Corporation, a Washington corporation, and Westower CNG Acquisition Company, a
Delaware corporation (the "Agreement"), that:
(1) the covenants, terms and conditions of the Agreement to be complied
with or performed by the Stockholder and the Company on or before the date
hereof have been complied with and performed in all material respects.
(2) the representations and warranties made by the Stockholder and the
Company in the Agreement are true and correct in all material respects at and as
of the date hereof, except that any representation or warranty that in
accordance with its terms was made with reference to a specific date was correct
in all material respects as of such date.
Dated: September 23, 1998
------------------------------------
PAUL BISHOP
CNG COMMUNICATIONS, INC.
By:
---------------------------------
Paul Bishop, President
B-1
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EXHIBIT C
MATTERS TO BE COVERED IN
OPINION OF COUNSEL FOR STOCKHOLDER AND COMPANY
1. The Company is a corporation duly incorporated, validly existing
and in good standing under the laws of the State of Delaware and has all
requisite corporate power and authority to own, operate and lease its properties
and assets and to carry on its business in the same manner as such businesses
are now being conducted. The Company is qualified as a foreign corporation to
do business in Arizona, Texas and Oklahoma.
2. The Stockholder and the Company have full power and authority to
execute, deliver and perform their obligations under the Agreement and to
consummate the transactions contemplated thereby. The Agreement has been duly
executed and delivered by the Stockholder and the Company and, to the extent
either the Delaware General Corporation Law or Arizona law is applicable,
constitutes a legal, valid and binding obligation of the Stockholder and
Company, enforceable against them in accordance with the terms thereof, except
as the enforceability thereof may be subject to the effect of (a) any applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws relating to
or affecting creditors' rights generally, and (b) general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law).
3. The authorized capital stock of the Company is as set forth in
the Agreement, and according to the stock records of the Company 4,000,000
shares are issued and outstanding and owned by Stockholder. All such shares are
validly issued, fully paid and non-assessable. To the knowledge of such counsel
there are no outstanding securities of the Company which are convertible into or
exchangeable for any shares of its capital stock and there is no existing
contract, option, warrant, call or similar commitment of any character granted
or issued by the Company calling for or relating to the issuance or transfer of
shares of capital stock or any other securities of the Company, except as set
forth in the schedules to the Agreement.
4. Upon filing of the Certificate of Merger with the Secretary of
State of the State of Delaware, CNG will be merged with and into Sub, and the
Company Shares will be converted as provided in the Agreement.
C-1
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EXHIBIT D
CLOSING CERTIFICATE
The undersigned, Westower Corporation, a Washington corporation
("Westower"), and Westower CNG Acquisition Company, a Delaware corporation
("Sub"), hereby certify, in connection with the transactions contemplated by the
Agreement of Merger, dated as of September 17, 1998, by and among CNG
Communications, Inc., Paul Bishop, Westower and Sub (the "Agreement") that:
(1) the covenants, terms and conditions of the Agreement to be
complied with or performed by Westower and Sub on or before the date hereof have
been complied with and performed in all material respects; and
(2) the representations and warranties made by Westower and Sub in the
Agreement are true and correct in all material respects at and as of the date
hereof, except that any representation or warranty that in accordance with its
terms was made with reference to a specific date was correct in all material
respects as of such date.
Dated: September 23, 1998 WESTOWER CORPORATION
By:
------------------------------------
Calvin J. Payne
President
WESTOWER CNG ACQUISITION COMPANY
By:
------------------------------------
Calvin J. Payne
President
D-1
