UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
UNDER THE SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. ____________)*
Page America Group, Inc.
________________________
(Name of Issuer)
Common Stock, $.10 par value
____________________________
(Title of Class of Securities)
695465302
_________
(CUSIP Number)
John B. Watkins, Esq.,
Wilmer, Cutler & Pickering,
100 Light Street, Baltimore, MD 21201
(410) 986-2820
______________
(Name, Address and Telephone Number of Person Authorized to Receive Notices
and Communications)
April 22, 1996
______________
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to
report the acquisition which is the subject of this Schedule 13D, and is
filing this schedule because of Rule 13d-1(b)(3) or (4), check the following
box ____.
Check the following box is a fee is being paid with the statement X. (A
___
fee is not required only if the reporting person: (1) has a previous
statement on file reporting beneficial ownership of more than five percent
of the class of securities described in Item 1; and (2) has filed no
amendment subsequent thereto reporting beneficial ownership of five percent
or less of such class.) (See Rule 13d-7).
Note: Six copies of this statement, including all exhibits, should be filed
with the Commission. See Rule 13d-1(a) for other parties to whom copies are
to be sent.
*The remainder of this cover page shall be filled out for a reporting
person's initial filing on this form with respect to the subject class of
securities, and for any subsequent amendment containing information which
would alter disclosures provided in a prior cover page.
<PAGE> 2 of 8
The information required on the remainder of this cover page shall not be
deemed to be "filed" for the purpose of Section 18 of the Securities
Exchange Act of 1934 ("Act") or otherwise subject to the liabilities of that
section of the Act but shall be subject to all other provisions of the Act
(however, see the Notes).
(Continued on following pages)
<PAGE>
<PAGE> 3 of 8
SCHEDULE 13D
CUSIP No. 695465302_____________________
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Metrocall, Inc.
IRS Identification No. 54-1215634
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a)___
(b)___
3 SEC USE ONLY
4 SOURCE OF FUNDS*
OO
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) OR 2(e) ____
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
NUMBER OF 7 SOLE VOTING POWER
SHARES -0-
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY 10,459,379
EACH 9 SOLE DISPOSITIVE POWER
REPORTING -0-
PERSON 10 SHARED DISPOSITIVE POWER
WITH -0-
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON
10,459,379
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
SHARES* ____
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
51%
14 TYPE OF REPORTING PERSON*
CO<PAGE>
<PAGE> 4 of 8
This Schedule 13D is filed by and on behalf of Metrocall,
Inc. ("Metrocall"). Metrocall has not previously filed a Schedule 13D with
respect to the securities that are the subject of this filing. As described
more fully in Item 4 below, Metrocall is filing this Schedule 13D pursuant
to Rule 13d-1(a) as a result of its entry into a certain Shareholders
Agreement dated April 22, 1996 (the "Shareholders Agreement") with several
holders of Page America Group, Inc.'s common stock (the "Page America
Shareholders") which granted Metrocall shared voting power over such common
stock.
ITEM 1. SECURITY AND ISSUER.
The class of securities to which this statement relates is
shares of common stock, par value $.10 (the "Common Stock") of Page America,
Inc. (the "Issuer"), a New York corporation, whose principal executive
office is located at 125 State Street, Suite 100, Hackensack, New Jersey,
07601.
ITEM 2. IDENTITY AND BACKGROUND.
Name: Metrocall, Inc.
State of Organization: Delaware
Principal Business: Wireless Communications, Paging and
Messaging Industry
Principal Business Address: 6677 Richmond Highway,
Alexandria, Virginia
The name, business address, principal occupation and
citizenship of each of the directors and executive officers and Metrocall
(the "Directors and Executive Officers"), and of each of the members of the
Board of Trustees of the Henry L. Hillman Trust, established under the laws
of Pennsylvania on November 18, 1985 (which may be deemed to be a
controlling person of Metrocall) (the "Trustees") are set forth in Exhibit 1
hereto and are hereby incorporated by reference.
During the last five years, neither Metrocall nor any of the
persons identified in Exhibit 1 have (i) been convicted in a criminal
proceeding (excluding traffic violations or similar misdemeanors), nor (ii)
been a party to a civil proceeding of a judicial or administrative body of
competent jurisdiction and as a result of such proceeding was or is subject
to a judgment, decree or final order enjoining future violations of, or
prohibiting or mandating activities subject to, federal or state securities
laws or finding any violation with respect to such laws.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
Metrocall acquired shared voting power over the Common Stock
and the Page America Shareholders' shares of the Issuer's Series One
Convertible Preferred Stock (the "Preferred Stock") (each of which votes
along with the Common Stock) pursuant to the Shareholders Agreement as
consideration for Metrocall's execution of a certain Asset Purchase
<PAGE> 5 of 8
Agreement by and among Metrocall, the Issuer and certain of the Issuer's
wholly owned subsidiaries dated April 22, 1996 (the "Asset Purchase
Agreement").
ITEM 4. PURPOSE OF TRANSACTION.
Metrocall and the Page America Shareholders entered the
Shareholders Agreement in order to facilitate the transactions contemplated
by the Asset Purchase Agreement. Pursuant to the Asset Purchase Agreement,
Metrocall has agreed to purchase substantially all of the Issuer's assets
for a total combined purchase price of $78,500,000 in cash and Metrocall
common stock, par value $.01 (the "Asset Sale and Purchase").
Pursuant to the Shareholders Agreement, the Page America
Shareholders agreed (i) to vote or otherwise grant Metrocall an irrevocable
proxy for the sole and limited purpose of voting the Common Stock and the
Preferred Stock in favor of the Asset Sale and Purchase at any special
meeting of the stockholders of the Issuer called to consider the Asset Sale
and Purchase and (ii) to grant Metrocall an irrevocable option to purchase
the Page America Shareholders' holdings of Common Stock and Preferred Stock
in the event that the Issuer exercises its right to terminate the Asset
Purchase Agreement upon its receipt of a financially superior offer or
proposal to acquire all or a significant part of the Issuer's business,
assets or capital shares by merger, consolidation, other business
combination, purchase of assets, tender or exchange offer or otherwise (the
"Stock Option"). Metrocall may exercise the Stock Option upon the
occurrence of the referenced condition at any time prior to February 1,
1997, the ultimate termination date of the Asset Purchase Agreement. The
Stock Option is exercisable (i) for each share of Common stock, at a price
equal to the average of the last sales price per share of such Common Stock
on the American Stock Exchange for the twenty consecutive trading days
immediately prior to April 22, 1996 and (ii) for each share of Preferred
Stock at a price of $105.
Other than the Asset Sale and Purchase and the Stock Option,
the terms of which are both as outlined herein, neither Metrocall nor to
Metrocall's knowledge, any persons identified in Exhibit 1 have (i) any
plans or proposals relating to the Issuer, nor (ii) any current plans to
acquire additional shares of Common Stock.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.
(a) Pursuant to the Shareholders Agreement, Metrocall
acquired limited shared voting rights over (i) 601,376 shares of Common
Stock, and (ii) 198,296 shares of Preferred Stock, which are convertible
into approximately 4,407,003 shares of Common Stock. Metrocall will in
addition acquire, pursuant to a declared dividend on the Preferred Stock
that will be received by the Page America Shareholders sometime within the
next sixty (60) days, limited shared voting power over approximately
5,451,000 additional shares of the Issuer's Common Stock (the "Dividend").
As a result of the above, Metrocall is deemed to
beneficially own an aggregate of 10,459,379 shares of Common Stock,
constituting 51% of the Issuer's shares deemed outstanding. The shares
deemed outstanding include (i) 8,052,305 shares of Common Stock outstanding,
(ii) 4,407,003 shares of Common Stock into which the Page America
<PAGE> 6 of 8
Shareholders Preferred Stock is convertible, and (iii) 7,900,000 shares of
Common Stock to be issued pursuant to the Dividend, each as reported in the
Issuer's annual report on Form 10-K for the year ended December 31, 1995.
(b) As stated above, Metrocall has or will have shared
voting power over 601,376 shares of Common Stock, 198,276 shares of
Preferred Stock convertible into approximately 4,407,003 shares of Common
Stock, and approximately 5,451,000 shares of Common Stock to be issued
pursuant to the Dividend. As and when the Preferred Stock is converted into
Common Stock, Metrocall will have shared voting power over shares of Common
Stock acquired upon conversion.
(c) Other than as set forth above, neither Metrocall nor to
Metrocall's knowledge any of the persons identified in Exhibit 1 have
effected any transactions of shares of Common Stock during the past sixty
days.
(d) Not applicable.
(e) Not applicable.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH
RESPECT TO SECURITIES OF THE ISSUER.
The Shareholders Agreement dated April 22, 1996 by and among
Metrocall, Bariston Paging Partners, L.P., Bariston Associates, Inc., T.
Rowe Price High Yield Fund, and Sandler Mezzanine General Partnership, the
terms of which are described in item 4.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.
Exhibit Description
_______ ____________
1 Directors and Executive Officers of Metrocall, Inc.
and Trustees of the Henry L. Hillman Trust
2 Shareholders Agreement dated April 22, 1996 by and
among Metrocall, Inc., Bariston Paging Partners,
L.P., Bariston Associates, Inc., T. Rowe Price High
Yield Fund, and Sandler Mezzanine General
Partnership
3 The Asset Purchase Agreement dated April 22, 1996
by and among Page America Group, Inc., Page America
of New York, Inc., Page America of Illinois, Inc.,
Page America Communications of Indiana, Inc., and
Page America of Pennsylvania, Inc. <PAGE>
<PAGE> 7 of 8
SIGNATURE
After reasonable inquiry and to the best of my knowledge and
belief, I certify that the information set forth in this statement is true
and correct.
____________________________ Metrocall, Inc.
Date
/s/ Vincent D. Kelly
By:________________________________________
Vincent D. Kelly,
Chief Financial Officer and Treasurer
<PAGE>
<PAGE> 8 of 8
Exhibit Index
_____________
Exhibit Page
_______ ____
Exhibit 1: Directors and Executive Officers of Metrocall, Inc. and
Trustees of the Henry L. Hillman Trust
Exhibit 2: Shareholders Agreement dated April 22, 1996 by and among
Metrocall, Inc., Bariston Paging Partners, L.P., Bariston
Associates, Inc., T. Rowe Price High Yield Fund, and Sandler
Mezzanine General Partnership
Exhibit 3: The Asset Purchase Agreement dated April 22, 1996 by and
among Page America Group, Inc., Page America of New York,
Inc., Page America of Illinois, Inc., Page America
Communications of Indiana, Inc., and Page America of
Pennsylvania, Inc
Exhibit 1
_________
Directors, Executive Officers and Trustees of
Metrocall, Inc. and The Henry L. Hillman Trust
______________________________________________
Set forth below, with respect to each Director, Executive Officer and
Trustee is the following: (a) name; (b) business address; (c) principal
occupation; and (d) citizenship.
DIRECTORS AND EXECUTIVE OFFICERS OF METROCALL, INC.:
1. (a) Vincent Kelly
(b) Metrocall, Inc.
6677 Richmond Highway
Alexandria, VA 22306
(c) Chief Financial Officer, Vice President,
Treasurer and Director
Metrocall, Inc.
(d) United States
2. (a) William Collins, III
(b) Metrocall, Inc.
6677 Richmond Highway
Alexandria, VA 22306
(c) President, Chief Executive Officer,
Director and Vice Chairman of the Board
Metrocall, Inc.
(d) United States
3. (a) Steven Jacoby
(b) Metrocall, Inc.
6677 Richmond Highway
Alexandria, VA 22306
(c) Chief Operating Officer,
Vice President and Director,
Metrocall, Inc.
(d) United States
4. (a) Suzanne S. Brock
(b) Metrocall, Inc.
6677 Richmond Highway
Alexandria, VA 22306
(c) Secretary and Director,
Metrocall, Inc.
(d) United States
5. (a) Richard M. Johnston
(b) Metrocall, Inc.
6677 Richmond Highway
Alexandria, VA 22306
(c) Chairman of the Board and Director,
Metrocall, Inc.;
Vice President for Investments,
The Hillman Company
(d) United States
6. (a) Harry L. Brock, Jr.
(b) Metrocall, Inc.
<PAGE> 2 of 3
6677 Richmond Highway
Alexandria, VA 22306
(c) Director,
Metrocall, Inc.
(d) United States
7. (a) Francis A. Martin, III
(b) Metrocall, Inc.
6677 Richmond Highway
Alexandria, VA 22306
(c) Director,
Metrocall, Inc.;
Chairman of the Board, President,
and Chief Executive Officer,
U.S. Media Holdings, Inc.
(d) United States
8. (a) Ronald V. Aprahamian
(b) Metrocall, Inc.
6677 Richmond Highway
Alexandria, VA 22306
(c) Director,
Metrocall, Inc.;
Chairman and Chief Executive Officer,
The Compucare Company
(d) United States
9. (a) Christopher A. Kidd
(b) Metrocall, Inc.
6677 Richmond Highway
Alexandria, VA 22306
(c) Director,
Metrocall, Inc.
(d) United States<PAGE>
<PAGE> 3 of 3
TRUSTEES OF THE HENRY L. HILLMAN TRUST (PENNSYLVANIA):
1. (a) Henry L. Hillman
(b) The Henry L. Hillman Trust
2000 Grant Building
Pittsburgh, PA 15219
(c) Trustee,
The Henry L. Hillman Trust
(d) United States
2. (a) Elsie Hilliard Hillman
(b) The Henry L. Hillman Trust
2000 Grant Building
Pittsburgh, PA 15219
(c) Trustee,
The Henry L. Hillman Trust
(d) United States
3. (a) C.F. Grefenstette
(b) The Henry L. Hillman Trust
2000 Grant Building
Pittsburgh, PA 15219
(c) Chief Executive Officer,
Chairman of the Board and
Director of the Hillman Company;
Trustee, The Henry L. Hillman Trust
(d) United States
Exhibit 2
STOCKHOLDERS AGREEMENT
STOCKHOLDERS AGREEMENT, dated April 22, 1996 among
Metrocall, Inc., a Delaware corporation ("Buyer"), and the persons listed on
the signature page hereof (the "Stockholders").
WHEREAS, the Stockholders collectively own, beneficially or
of record, the number of issued and outstanding shares of the Series One
Convertible Preferred Stock (the "Preferred Stock"), and the number of
issued and outstanding shares of Common Stock, par value $.10 per share (the
"Common Stock") of Page America Group, Inc., a New York corporation (the
"Company") indicated on the attached signature pages;
WHEREAS, Buyer, the Company, and its wholly owned
subsidiaries, Page America of New York, Inc., a New York corporation, Page
America of Illinois, Inc., an Illinois corporation, Page America
Communications of Indiana, Inc., an Indiana corporation, and Page America of
Pennsylvania, Inc., a Pennsylvania corporation (collectively, the
"Sellers"), propose to enter into an Asset Purchase Agreement of even date
herewith (the "Purchase Agreement") providing for the purchase and sale of
all or substantially all of the Sellers' assets to Buyer (the "Asset Sale
and Purchase");
WHEREAS, as a condition to the willingness of Buyer to enter
into the Purchase Agreement, Buyer has requested that each Stockholder
agree, and in order to induce Buyer to enter into the Purchase Agreement,
each Stockholder has agreed to enter into this Agreement setting forth
certain rights and obligations of the parties with respect to the
Stockholder Shares (as hereinafter defined);
NOW THEREFORE, in consideration of the premises and the
representations, warranties and agreement herein contained, the parties
agree as follows:
ARTICLE I
DEFINED TERMS
Section 1.1. Defined Terms. (a) Capitalized terms used
______________
herein and not defined shall have the meaning ascribed thereto in the
Purchase Agreement.
(b) The term "Stockholder Shares" as used herein means, with
___________________
respect to each Stockholder the aggregate of (i) the number of shares of
Preferred Stock owned beneficially or of record by such Stockholder, (ii)
the number of shares of Common Stock owned beneficially or of record by such
Stockholder (the numbers for items (i) and (ii) are set forth opposite such
Stockholders's name on the signature page hereof, and (iii) any additional
shares of Common Stock, Preferred Stock or rights to acquire voting
securities of the Company acquired by such Stockholder (whether by purchase
or otherwise) from and after the date of this Agreement.
<PAGE> 2 of 6
ARTICLE II
VOTING OF STOCKHOLDER SHARES FOR THE ASSET SALE AND PURCHASE
Section 2.1 No Disposition of Shares. Prior to the earlier
_________________________
to occur of (i) the stockholder approval referenced in Section 8.3.7 of the
Purchase Agreement or (ii) the termination of the Purchase Agreement
pursuant to Article 9 thereof, no Stockholder shall transfer, pledge, or
otherwise dispose of any Stockholder Shares, deposit any Stockholder Shares
into a voting trust or enter into any voting agreement or arrangement with
respect thereto, or enter into any contract, option or other arrangement or
undertaking with respect to the direct or indirect acquisition, sale,
assignment, transfer or disposition of any Stockholder Shares.
Section 2.2 Voting of Stockholder Shares. Each Stockholder
_____________________________
hereby agrees to cause each Stockholder Share owned by such Stockholder
beneficially or of record to be voted (i) at such special meeting of
stockholders of the Company to be called to consider the Asset Sale and
Purchase (the "Special Meeting"), in favor of the Asset Sale and Purchase
and (ii) at any meeting of stockholders of the Company or at any adjournment
thereof or in any other circumstances upon which their vote, consent or
other approval is sought, against (a) any Acquisition Proposal or (b) any
amendment of the Company's Articles of Incorporation or By-laws or other
proposal or transaction involving the Company or any of its subsidiaries
which amendment or other proposal or transaction would in any manner impede,
frustrate, prevent or nullify the Asset Sale and Purchase, the Purchase
Agreement or any other transactions contemplated by the Purchase Agreement
(each of the foregoing in clauses (a) or (b) above a "Competing
Transaction"). In furtherance of the foregoing, each Stockholder hereby
irrevocably appoints ______________, _________________, and each of them,
any other designees of Buyer, the attorneys-in-fact and proxies of such
Stockholder, each with full power of substitution, to vote at the Special
Meeting or at any annual, special or adjourned meeting of the Company's
stockholders or otherwise (including by executing written consents) in such
manner as each such attorney-in-fact and proxy or his substitute shall in
his sole discretion deem proper (i) in favor of the Asset Sale and Purchase,
the execution and delivery of the Purchase Agreement and approval of the
terms thereof and each of the other transactions contemplated by the
Purchase Agreement and (ii) against any Competing Transaction. This power
of attorney and proxy is coupled with an interest, irrevocable and granted
in consideration of the Buyer's agreement to enter into the Purchase
Agreement. Upon the execution of this Agreement, all prior powers of
attorney, proxies and consents given by the undersigned with respect to such
Stockholder Shares will, without further action, be revoked and no
subsequent powers of attorney, proxies, consents or revocation may be given
(and, if given, will not be deemed effective) by such Stockholder.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF STOCKHOLDERS
Each Stockholder severally represents and warrants to Buyer that:
<PAGE> 3 of 6
SECTION 3.1. Representations and Warranties. Such
_______________________________
Stockholder is the sole, true, lawful and beneficial or record owner of the
number of Stockholder Shares set forth opposite his name on the signature
page hereof and there are no restrictions on such Stockholder's voting
rights or rights of disposition pertaining thereto, except for the
restrictions of the Securities Act of 1933, as amended. None of such
Stockholder Shares is subject to any voting trust or other agreement (other
than this Agreement) or arrangement with respect to the voting of such
Stockholder Shares. This Agreement has been duly executed and delivered by
such Stockholder and constitutes a valid and binding agreement of such
Stockholder. The execution, delivery and performance by such Stockholder of
this Agreement and the consummation by such Stockholder of the transactions
contemplated hereby require no action by, or filing with, any governmental
body, agency, official or authority by such Stockholder. The execution,
delivery and performance of this Agreement by such Stockholder does not, and
the consummation by such Stockholder of the transaction contemplated hereby
does not and will not, contravene or conflict with or constitute a material
violation of any provision of any law, regulation, judgment, injunction,
order or decree binding upon or applicable to such Stockholder.
ARTICLE IV
COVENANTS OF STOCKHOLDERS
SECTION 4.1 No Solicitation of Offers. Each Stockholder
__________________________
shall comply with, and be bound by, the restrictions set forth in Section
6.9 of the Purchase Agreement as if such restrictions were fully set forth
herein.
SECTION 4.2 Stock Option. Each Stockholder hereby grants
_____________
to Buyer an irrevocable option (the "Stock Option") to purchase all of
Stockholder Shares legally and/or beneficially owned by such Stockholder at
any time during the Exercise Period (as defined below). Buyer shall pay
Stockholders for each share of Common Stock delivered at the Stock Option
Closing (as hereinafter defined), a price per share equal to the average of
the last sales price per share on the American Stock Exchange for the twenty
consecutive trading days immediately prior to the date of execution of this
Agreement (the "Common Stock Purchase Price"). Buyer shall pay Stockholders
for each share of Preferred Stock delivered at Closing, a price per share of
$105.00
SECTION 4.3 Exercise of Stock Option. (a) Subject to
_________________________
Section 4.4 hereof, the Stock Option may be exercised by Buyer, in whole
and for each Stockholder but not in part or for less than all Stockholders,
during the period (the "Exercise Period") commencing on the date of the
Company's exercise of its termination rights pursuant to Section 9.1.6 of
the Purchase Agreement and ending on the date ten business days thereafter.
(b) In the event Buyer wishes to exercise the Stock Option,
Buyer shall send a written notice (an "Exercise Notice") during the Exercise
Period to each Stockholder specifying that Buyer shall purchase the total
number of Stockholder Shares held by such Stockholder and a date, which
<PAGE> 4 of 6
shall be a business day for the closing of such purchase no later than sixty
days after the sending of such notice (the "Stock Option Closing"). The
Stock Option Closing shall take place at the Washington, D.C. offices of
Wilmer, Cutler & Pickering.
(c) Upon receipt of the Exercise Notice, each Stockholder
shall become obligated to deliver to Buyer a certificate or certificates
representing the number of Stockholder Shares held by such Stockholder in
accordance with the terms of this Agreement, on the later of the date
specified in such Exercise Notice and the first business day on which the
conditions specified in Section 4.4 shall be satisfied. The date specified
in such Exercise Notice for the Stock Option Closing may be as early as one
business day after the date of such Exercise Notice.
Section 4.4 Condition To Delivery of the Stockholder
_________________________________________
Shares. The obligation of the Stockholders to deliver the Stockholder
______
Shares upon exercise of the Stock Option is subject to the following
conditions:
(a) All waiting periods under the Hart-Scott-Rodino
Antitrust Improvements Act of 1976, as amended, applicable to the exercise
of the Stock Option and the delivery of the Stockholder Shares shall have
expired or been terminated, and any required consent of the FCC applicable
to the exercise of the Stock Option shall have become a Final Order.
(b) There shall be no preliminary or permanent injunction or
other order by any court of competent jurisdiction restricting, preventing
or prohibiting the exercise of the Stock Option or delivery of the
Stockholder Shares in respect of such exercise.
Section 4.5 Stock Option Closing. At the Stock Option
____________________
Closing, each Stockholder will deliver to Buyer a certificate or
certificates evidencing the number of Stockholder Shares owned by such
Stockholder, each such certificate being duly endorsed in blank and
accompanied by such stock powers and such other documents as may be
necessary in Buyer's judgment to transfer record ownership of the
Stockholder Shares into Buyer's name on the stock transfer books of the
Company, and Buyer will purchase all delivered Stockholder Shares at the
price specified in Section 4.2. All payments made by Buyer to the
Stockholders pursuant to this Section 4.5 shall be made by wire transfer of
immediately available funds or by certified bank check payable to the
Stockholders.
Section 4.6 Adjustments Upon Changes in Capitalization. In
___________________________________________
the event of any change in the number of issued and outstanding Stockholder
Shares by reason of any stock dividend, subdivision, merger,
recapitalization, combination, conversion or exchange of share, or any other
change in the corporate or capital structure of the Company (including,
without limitation, the declaration or payment of an extraordinary dividend
of cash or securities) which would have the effect of diluting or otherwise
adversely affect Buyer's rights and privileges under this Agreement, the
number and kind of Stockholder Shares and any consideration payable in
respect of the Stockholder Shares shall be appropriately and equitably
<PAGE> 5 of 6
adjusted to restore to Buyer its rights and privileges under this Agreement.
Without limiting the scope of the foregoing, in any such event, at the
option of Buyer, the Stock Option shall represent the right to purchase in
addition to the number and kind of shares which Buyer would be entitled to
purchase pursuant to Section 4.2, whatever securities, cash or other
property the Stockholder Shares shall have been converted into or otherwise
exchanged for, together with any securities, cash or other property which
shall have been distributed with respect to such Stockholder Shares.
ARTICLE V
MISCELLANEOUS
Section 5.1 Termination. This Agreement shall become
____________
effective upon its execution by each of the parties hereto and upon the
execution of the Purchase Agreement. This Agreement may be terminated at
any time by mutual written consent of each of the parties hereto. Other
than the Stock Option, which shall be governed by Sections 4.2 through 4.6,
this Agreement shall terminate, without any action by the parties hereto, on
the date on which the Purchase Agreement terminates in accordance with its
terms. No such termination shall relieve any party from liability for any
breach of this Agreement. The representations and warranties set forth
herein shall not survive the termination of this Agreement (or in the event
the Stock Option is exercised, the purchase of the Stockholder Shares
pursuant thereto).
Section 5.2 Specific Performance. The parties hereto agree
_____________________
that Buyer would be irreparably damaged if for any reason any Stockholder
failed to perform any of its other obligations under this Agreement, and
that Buyer would not have an adequate remedy at law for money damages in
such event. Accordingly, Buyer shall be entitled to specific performance
and injunctive and other equitable relief to enforce the performance of this
Agreement by each Stockholder. This provision is without prejudice to any
other rights that Buyer may have against any Stockholder for any failure to
perform any obligations under this Agreement.
Section 5.3 Modification of Agreement. This Agreement may
_________________________
not be modified amended, altered or supplemented, except upon the execution
and delivery of a written agreement executed by the parties hereto. The
provisions of this Agreement shall be binding upon and inure to the benefit
of the parties hereto and their respective successors and assigns; provided
________
that no party may assign, delegate, or otherwise transfer any of its rights
or obligation under this Agreement without the consent of the other parties
hereto, except to the extent that Buyer may assign its rights under this
Agreement to its direct or indirect wholly-owned subsidiary, but such
assignment shall not relieve Buyer of its obligations hereunder. This
Agreement shall be construed in accordance with and governed by the law of
Delaware without regards to conflict of laws principles. This Agreement may
be signed in any number of counterparts, each of which shall be an original,
with the same effect as if the signatures thereto and hereto shall have
received counterparts hereof signed by all of the other parties hereto.
<PAGE> 6 of 6
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed as of the day and year first above written.
BUYER
_____
METROCALL, INC. (SEAL)
By:_____________________
Its:
STOCKHOLDERS
____________
Shares of Shares of
Common Stock Preferred Stock
________________________ __________ __________
________________________ __________ __________
________________________ __________ __________
________________________ __________ __________
STOCKHOLDERS
____________
SHARES OF SHARES OF
COMMON STOCK PREFERRED STOCK
________________________ __________ __________
________________________ __________ __________
________________________ __________ __________
________________________ __________ __________
________________________ __________ __________
________________________ __________ __________
________________________ __________ __________
EXHIBIT 3
_________
ASSET PURCHASE AGREEMENT
BY AND AMONG
PAGE AMERICA GROUP, INC.,
PAGE AMERICA OF NEW YORK, INC.
PAGE AMERICA OF ILLINOIS, INC.
PAGE AMERICA COMMUNICATIONS OF
INDIANA, INC.
PAGE AMERICA OF PENNSYLVANIA, INC.
AND
METROCALL, INC.
Dated as of April 22, 1996<PAGE>
<PAGE> 2 of 47
TABLE OF CONTENTS
SCHEDULES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
EXHIBITS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
ARTICLE 1 DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . .
ARTICLE 2 PURCHASE AND SALE OF ASSETS . . . . . . . . . . . . . . . .
2.1 Conveyance of Assets . . . . . . . . . . . . . . .
2.2 Excluded Assets. . . . . . . . . . . . . . . . . .
2.3 Liabilities. . . . . . . . . . . . . . . . . . . .
2.4 Excluded Liabilities . . . . . . . . . . . . . . .
2.5 Seller and Stockholder Action. . . . . . . . . . .
ARTICLE 3 CLOSING . . . . . . . . . . . . . . . . . . . . . . . . . .
3.1 Determination of Closing Date. . . . . . . . . . .
3.2 Time and Place of Closing. . . . . . . . . . . . .
3.3 Closing Documents. . . . . . . . . . . . . . . . .
ARTICLE 4 PURCHASE PRICE, METHOD OF PAYMENT,ALLOCATION OF PURCHASE
PRICE . . . . . . . . . . . . . . . . . . . . . . . . . . .
4.1 Purchase Price for Assets. . . . . . . . . . . . .
4.2 Post-Closing Allocation of the Purchase Price. . .
4.3 Adjustments to the Purchase Price. . . . . . . . .
4.4 Payment of Post-Closing Purchase Price
Adjustments. . . . . . . . . . . . . . . . . . . .
4.5 Escrow Agreement . . . . . . . . . . . . . . . . .
ARTICLE 5 REPRESENTATIONS AND WARRANTIES. . . . . . . . . . . . . . .
5.1 Representations and Warranties of the Sellers. . .
5.2 Representations and Warranties of the Buyer. . . .
ARTICLE 6 CONDUCT PRIOR TO CLOSING. . . . . . . . . . . . . . . . . .
6.1 Filing of Assignment Applications. . . . . . . . .
6.2 Antitrust Laws and the Sellers . . . . . . . . . .
6.3 Antitrust Laws and the Buyer . . . . . . . . . . .
6.4 Access to Information Concerning Sellers'
Business . . . . . . . . . . . . . . . . . . . . .
6.5 Confidentiality. . . . . . . . . . . . . . . . . .
6.6 Control of the Seller's Business. . . . . . . . .
6.7 The Seller's Pre-Closing Covenants . . . . . . . .
6.8 The Buyer's Pre-Closing Covenants. . . . . . . . .
6.9 No Solicitation of Offers. . . . . . . . . . . . .
6.10 Risk of Loss . . . . . . . . . . . . . . . . . . .
ARTICLE 7 COVENANTS RELATING TO EMPLOYMENTAND EMPLOYEE MATTERS. . . .
7.1 Offer of Employment. . . . . . . . . . . . . . . .
7.2 Wage and Withholding Reporting Obligations . . . .
ARTICLE 8 CONDITIONS PRECEDENT. . . . . . . . . . . . . . . . . . . .
8.1 Conditions Precedent to Obligations of Parties . .
8.2 Conditions Precedent to Obligations of the
Buyer. . . . . . . . . . . . . . . . . . . . . . .
8.3 Conditions Precedent to the Obligations of the
Sellers. . . . . . . . . . . . . . . . . . . . . .
<PAGE> 3 of 47
8.4 Waiver of Conditions . . . . . . . . . . . . . . .
ARTICLE 9 TERMINATION AND DEFAULT . . . . . . . . . . . . . . . . . .
9.1 General. . . . . . . . . . . . . . . . . . . . . .
9.2 Procedure Upon Termination . . . . . . . . . . . .
9.3 Effect of Termination. . . . . . . . . . . . . . .
ARTICLE 10 POST-CLOSING TRANSACTIONS . . . . . . . . . . . . . . . . .
10.1 Transition . . . . . . . . . . . . . . . . . . . .
10.2 Access To Books and Records. . . . . . . . . . . .
10.3 Assignment and Further Assurances. . . . . . . . .
10.4 Confidentiality of Customer Lists. . . . . . . . .
ARTICLE 11 INDEMNIFICATION AND SURVIVAL. . . . . . . . . . . . . . . .
11.1 Indemnification by the Sellers . . . . . . . . . .
11.2 Indemnification by the Buyer . . . . . . . . . . .
11.3 Claims for Indemnification . . . . . . . . . . . .
11.4 Defense by Indemnifying Party. . . . . . . . . . .
11.5 Manner of Indemnification. . . . . . . . . . . . .
11.6 Survival of Representations and Warranties . . . .
ARTICLE 12 MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . .
12.1 Brokers. . . . . . . . . . . . . . . . . . . . . .
12.2 Notices. . . . . . . . . . . . . . . . . . . . . .
12.3 Expenses of Transfer . . . . . . . . . . . . . . .
12.4 Assignment . . . . . . . . . . . . . . . . . . . .
12.5 Counterparts . . . . . . . . . . . . . . . . . . .
12.6 Entire Agreement . . . . . . . . . . . . . . . . .
12.7 Governing Law. . . . . . . . . . . . . . . . . . .
12.8 Headings . . . . . . . . . . . . . . . . . . . . .
12.9 Severability . . . . . . . . . . . . . . . . . . .
12.10 Modification and Amendment . . . . . . . . . . . .
12.11 Waiver . . . . . . . . . . . . . . . . . . . . . .
12.12 Parties Obligated and Benefited. . . . . . . . . .
12.13 Attorneys' Fees. . . . . . . . . . . . . . . . . .
12.14 Rights to Specific Performance . . . . . . . . . .
12.15 Actions. . . . . . . . . . . . . . . . . . . . . .
12.16 Terms. . . . . . . . . . . . . . . . . . . . . . .
12.17 Construction . . . . . . . . . . . . . . . . . . .
<PAGE>
<PAGE> 4 of 47
SCHEDULES
_________
Schedule 1.22 Non-recurring Items
Schedule 1.26 Office Locations
Schedule 1.30 Indebtedness for Borrowed Money
Schedule 2.1 Assets
Schedule 2.3 Liabilities
Schedule 4.2 Allocation of Purchase Price
Schedule 4.3(b) Variations from GAAP on Closing Income Statement
and Closing Balance Sheet
Schedule 5.1.3 Seller Violations and Conflicts
Schedule 5.1.4(a) Licenses; Actions
Schedule 5.1.5 Existing Liens
Schedule 5.1.6 Tax Audits and Waivers
Schedule 5.1.7 Litigation
Schedule 5.1.10 Variations from GAAP on Financial Statements
Schedule 5.1.11 Real Property; Exceptions to Title
Schedule 5.1.14 Contracts
Schedule 5.1.15 Transferability of Contract Rights
Schedule 5.1.16 Personnel Benefits; Bonuses
Schedule 5.1.18 Transactions with Affiliates
Schedule 12.1 Brokers
EXHIBITS
________
Exhibit 2.5(a) Stockholders' Agreement
Exhibit 4.5 Escrow Agreement
Exhibit 8.4.5 Form of Registration Rights Agreement<PAGE>
<PAGE> 5 of 47
ASSET PURCHASE AGREEMENT
THIS ASSET PURCHASE AGREEMENT (this "Agreement"), dated as
of April 22, 1996, by and among PAGE AMERICA GROUP, INC., a New York
corporation, PAGE AMERICA OF NEW YORK, INC., a New York corporation, PAGE
AMERICA OF ILLINOIS, INC., an Illinois corporation, PAGE AMERICA
COMMUNICATIONS OF INDIANA, INC., an Indiana corporation, PAGE AMERICA OF
PENNSYLVANIA, INC., a Pennsylvania corporation (collectively the "Sellers"
and individually a "Seller"), and METROCALL, INC., a Delaware corporation
(the "Buyer").
W I T N E S S E T H:
Page America Group, Inc. (the "Parent") owns all of the
issued and outstanding shares of stock of each of the other Sellers.
Sellers are engaged in the radio paging business. Buyer wishes to purchase,
and Sellers wish to sell, substantially all of Sellers' assets and
properties as hereinafter described relating to the Sellers' Business.
In order to satisfy a condition to the Buyer entering into
this Agreement and incurring the obligations set forth herein, concurrently
with the execution and delivery of this Agreement certain stockholders of
Parent have entered into a Stockholders' Agreement (the "Stockholders'
Agreement") with the Buyer and the Parent pursuant to which such
stockholders have agreed to vote their shares of Parent stock (the "Shares")
and grant the Buyer irrevocable proxies with respect to the voting of the
Shares in favor of the transactions contemplated by this Agreement, and to
grant the Buyer an option to purchase the Shares.
In consideration of the foregoing and of the covenants,
agreements, representations and warranties hereinafter contained, and
intending to be legally bound, the Sellers and the Buyer hereby agree as
follows:
ARTICLE 1
DEFINITIONS
___________
As used herein, the following terms shall have the following
meanings:
1.1 Accounting Terms. Accounting terms used herein and
________________
not otherwise defined shall be construed in accordance with generally
accepted accounting principles ("GAAP"), consistently applied.
1.2 Affiliate means, as to a Seller, any entity that is
_________
controlled by, under common control with, or controlling the Seller.
1.3 Acquisition Proposal has the meaning given that
____________________
term in Section 6.9 hereof.
<PAGE> 6 of 47
1.4 Assets means the Assets as such term is defined in
______
Article 2 hereof.
1.5 Assignment Applications means the applications to
_______________________
be jointly prepared by the Sellers and the Buyer and filed with the FCC
and/or any PUC requesting its written consent to the assignment or transfer
of control of the Licenses from the Sellers to the Buyer.
1.6 Audited Financial Statements has the meaning given
____________________________
that term in Section 5.1.10 of this Agreement.
1.7 Closing means the consummation of the sale and
_______
purchase of the Assets in accordance herewith by the assignment and
conveyance thereof by the Sellers to the Buyer, and the payment by the Buyer
to the Sellers of the portion of the Purchase Price to be paid at the
Closing.
1.8 Closing Date means the date and time on which the
____________
Closing occurs, as provided by Section 3.1.
1.9 Confidential Information means all data and
________________________
information which the Sellers and their agents and representatives make
available to the Buyer, its agents, or representatives in accordance with
this Agreement prior to Closing and which: (a) is not information which is
a matter of public knowledge or which has heretofore been or is hereafter
made available, without any requirement of confidentiality, with the
Sellers' consent to third parties other than the Buyer, its agents, or
representatives, or filed as public information with any governmental
authority other than as a result of a breach of the covenant set forth in
Section 6.5 hereof; and (b) is proprietary information relating to the
Sellers' Business or the Transaction.
1.10 DOJ means the United States Department of Justice.
___
1.11 Environmental Laws. Environmental laws shall mean
__________________
the Resource Conservation and Recovery Act of 1976, U.S.C. Section 6901-
6987, as amended by the Hazardous and Solid Waste Amendments of 1984, the
Compensation and Liability Act, as amended by the Superfund Amendments and
Reauthorization Act of 1986, 42 U.S.C. Section 9601-9657, the Hazardous
Materials Transportation Act of 1975, 49 U.S.C. Section 1801-1812, the Toxic
Substances Control Act, the Clean Air Act, 42 U.S.C. Section 7401 et seq.,
the Federal Insecticide, Fungicide and Rodenticide Act, 7 U.S.C. Section 136
et seq., the Clean Water Act, 33 U.S.C. Section 1251 et seq., the
Comprehensive Environmental Response, Compensation and Liability Act, 42
U.S.C. Section et seq., and any substantially similar state or local
environmental laws.
<PAGE> 7 of 47
1.12 Excluded Assets has the meaning given that term in
_______________
Section 2.2 hereof.
1.13 FCC means the Federal Communications Commission.
___
1.14 Final Order means an action by the FCC or any PUC
___________
asserting authority over this transaction granting its consent and approval
to the assignment or transfer of control of the Licenses or the Transaction
that has not been reversed, stayed, enjoined, set aside, annulled or
suspended and with respect to which no action, request for stay, petition
for review or rehearing, reconsideration or appeal is pending, and as to
which the time for filing any request, petition, or appeal has expired and
the time for agency action to set aside its consent on its own motion has
expired.
1.15 FTC means the Federal Trade Commission.
___
1.16 Hazardous Substance means any pollutant,
___________________
contaminant, chemical, industrial, toxic, hazardous, or noxious substances
or waste which is regulated by any governmental authority under any
Environmental Law.
1.17 Liabilities means all debts, claims, liabilities,
___________
obligations, damages, and expenses of the Sellers of every kind and nature,
whether known, unknown, contingent, absolute, determined, indeterminable, or
otherwise.
1.18 Licenses means and includes with respect to the
________
Sellers' Business all licenses, permits, franchises and authorizations
issued by the FCC and/or any PUC, and/or other relevant government agencies
(including pending applications for any of the foregoing), for the
construction or operation of the Sellers' Business, including all renewals
and extensions thereof and all additional licenses, permits, franchises, and
authorizations obtained or applied for by the Sellers from the date of this
Agreement to the Closing Date.
1.19 Lien means any mortgage, pledge, security interest,
____
encumbrance, lien, claim or charge of any kind.
1.20 Material Adverse Effect or Material Adverse Change
__________________________________________________
means any change or effect that is, or is reasonably likely to be,
materially adverse to the business, financial condition, assets, liabilities
or results of operations of the Sellers' Business, other than a change in
national economic conditions or which affects the paging industry generally.
<PAGE> 8 of 47
1.21 Person means an individual, corporation,
______
association, partnership, joint venture, joint stock company, trust, estate,
limited liability company, limited liability partnership, governmental
entity, or other entity or organization.
1.22 Pro Forma Defined Operating Cash Flow means for the
_____________________________________
three consecutive calendar month period immediately prior to the date of
determination, the net income of the Sellers for such period, determined on
a consolidated basis and before extraordinary items, those nonrecurring
items set forth on Schedule 1.22 and gain or loss on disposal of capital
assets, plus any amount of interest expense, federal and state income taxes,
depreciation and amortization deducted, less any amount of interest income
included in determining such income.
1.23 Pro Forma Service Revenue means for the three
_________________________
consecutive calendar month period immediately prior to the date of
determination, the Sellers' total paging operations service revenue to the
extent that such revenue has been derived in the ordinary course of business
consistent with Sellers' past business practices, consisting of (a) service
revenue, (b) service revenue - agents and (c) other revenue for such period,
each such item to be determined consistently with such items shown on the
Audited Financial Statements.
1.24 PUC means a Public Utilities Commission, or any
___
substantially similar state regulatory agency of any state which exercises
jurisdiction over the Sellers or the Sellers' Business.
1.25 Real Property means all Assets consisting of
_____________
interests in real property, including, without limitation, appurtenances,
improvements, and fixtures located on such real property, leasehold
interests therein and any other interests in real property.
1.26 Sellers' Business means the radio paging and
_________________
related businesses of the Sellers, the principal places of business of which
are in the New York City and Chicago metropolitan areas, and the branch
offices as set forth in Schedule 1.26, attached hereto.
1.27 Subscribers means units in service for which
___________
Sellers receive or charge a monthly or recurring fee and for which service
has not been permanently terminated by Sellers. The term Subscriber shall
exclude units in service permanently terminated by Sellers for non-payment,
those for which a notice of cancellation has been received by the Sellers
from a customer and those units in service with a delinquent balance (not in
reasonable dispute) for services previously rendered which balance is more
than one hundred and twenty (120) days past due.
<PAGE> 9 of 47
1.28 To a Sellers' Knowledge or To the Knowledge of the
__________________________________________________
Sellers with respect to a fact or matter shall mean knowledge of any
_______
executive officer of any of the Sellers. For such purposes, such persons
shall be conclusively deemed to have knowledge of any fact or matter that
would have or should have come to the attention of such persons in the
course of discharging their duties in a reasonable and prudent manner
consistent with sound business practice.
1.29 Transaction means the assignment of the Licenses
___________
and the sale of the Assets subject to the obligations and conditions set
forth herein.
1.30 Working Capital Adjustment shall mean, as of a
__________________________
date, a purchase price adjustment equal to the consolidated current assets
(including accounts receivable net of reserves for uncollectible accounts)
excluding (i) cash and cash equivalents of the Sellers and (ii) any escrowed
monies from the July 28, 1995 asset sale to Paging Network of Florida,
Inc., minus the consolidated current liabilities (excluding indebtedness for
borrowed money described on Schedule 1.30, but including all amounts
necessary to satisfy those Liens listed in the attachment to Schedule 5.1.5
in full) of the Sellers. The Working Capital Adjustment may be positive or
negative (i.e., may increase or decrease the Purchase Price otherwise
payable). Any liabilities included in the calculation of the Working
Capital Adjustment shall be deemed Assumed Liabilities.
ARTICLE 2
PURCHASE AND SALE OF ASSETS
___________________________
2.1 CONVEYANCE OF ASSETS.
_____________________
In exchange for the consideration specified herein and upon
the terms and subject to the conditions set forth in this Agreement, on the
Closing Date, the Buyer will purchase from the Sellers and the Sellers will
sell, convey, transfer, assign, and deliver up to the Buyer all of Sellers'
right, title and interest in all assets, properties and rights of the
Sellers, of every type and description, real, personal and mixed, tangible
and intangible, known or unknown, fixed or not fixed, choate or inchoate,
accrued, absolute, contingent or otherwise, wherever located and whether or
not reflected on the books and records of the Sellers, and used or held for
use in connection with the Sellers' Business at any time prior to the date
hereof, together with additional assets acquired in the ordinary course of
business from the date hereof to the Closing Date (all such assets,
properties and rights are hereinafter collectively referred to as the
"Assets"). A list of such Assets having a value in excess of $1,000 is
attached hereto as Schedule 2.1 and includes, without limitation: (a) all
capitalized equipment and other fixed assets used in the Sellers' Business;
(b) the corporate logos, trade names, trademarks, copyrights, customer lists
<PAGE> 10 of 47
and goodwill of the Sellers and any other intellectual property owned by or
licensed to the Sellers; (c) the Licenses; (d) all accounts receivable of
the Sellers; (e) contract rights; (f) all items of inventory and supplies
owned by the Sellers; (g) the Real Property; and (h) books and records
(whether in hard copy or computerized) kept in the ordinary course and
reasonably necessary for the continued conduct of the Sellers' Business,
other than minute books and similar official corporate records.
2.2 EXCLUDED ASSETS.
________________
Notwithstanding Section 2.1 above, the Sellers are not
selling, transferring, or conveying to the Buyer any of the following, all
of which are hereinafter referred to as "Excluded Assets":
(a) cash and cash equivalents;
(b) assets related to employee benefit plans;
(c) accounting books and records;
(d) the Purchase Price payable pursuant to this
Agreement;
(e) the rights of the Sellers under this
Agreement;
(f) stock, minute books and corporate seals of
the Sellers; and
(g) assets relating to Sellers' former paging
operations in California and Florida, including, but not limited to, real
property owned in Florida and amounts due to Sellers in connection with the
sale of the California and Florida paging operations.
2.3 LIABILITIES.
____________
On and after the Closing Date, the Buyer shall assume only
those Liabilities of Sellers incurred in the ordinary course of business,
relating to contracts assumed by Buyer, those Liabilities set forth in
Schedule 2.3 attached hereto and any other Liabilities included in the
calculation of the Working Capital Adjustment (the "Assumed Liabilities").
2.4 EXCLUDED LIABILITIES.
_____________________
Except for the Assumed Liabilities specifically set forth in
Section 2.3, the Buyer shall not be required to assume, pay, fulfill,
perform or otherwise discharge any liabilities or obligations of the
Sellers. Without limiting the generality of the foregoing and except for
the Assumed Liabilities, the Buyer shall not assume or be liable for and the
Sellers shall indemnify the Buyer against and hold the Buyer harmless from
any of the following liabilities or obligations (herein referred to as
"Excluded Liabilities"):
<PAGE> 11 of 47
(a) any of the Sellers' liabilities or
obligations under this Agreement and the other agreements with the Buyer
contemplated hereby (it is understood that this Section 2.4(a) is not
intended to expand or alter the parties' respective rights under such other
agreements.);
(b) any of the Sellers' liabilities or
obligations for expenses or fees incident to or arising out of the
negotiation, preparation, approval, or authorization of this Agreement or
the consummation (or preparation for the consummation) of the transactions
contemplated hereby, including without limitation, brokers', attorneys' and
accountants' fees;
(c) any liability or obligation of the Sellers,
at any time, prior to the Closing, with respect to federal, state, local or
foreign taxes; and any liability for interest, penalties or additions to any
of such taxes (except prorated taxes);
(d) any liabilities or obligations in
connection with any facilities formerly used by the Sellers' Business which
are not included in the Assets;
(e) any obligations or liabilities which relate
to any group health plan, bonus, retirement, retiree, disability, pension,
profit sharing, stock bonus, thrift, severance, incentive, deferred or other
compensation, welfare benefit, or other plan, program or arrangement with
respect to any employee, former employee or beneficiary of such employee or
former employee, of the Sellers or any person that, together with the
Sellers, would be treated as a single employer under Section 414 of the
Internal Revenue Code;
(f) any liability or obligation of the Sellers
which relates to the Excluded Assets;
(g) any liability or obligation arising out of
the operation of the Sellers' Business before Closing, including, but not
limited to, any fine, forfeiture or other penalty imposed by the FCC for any
non-compliance by the Sellers with the terms of the Licenses or with any FCC
rule or regulation and all items listed on Schedule 5.1.16;
(h) all costs and damages arising out of the
litigation described on Schedule 5.1.7;
(i) any liability or obligation relating to the
any and all Liens resulting from the NEC America Leasing contract (Sellers
shall satisfy any and all such Liens in full and obtain a release thereof
either prior to or at Closing); and
(j) any other liability or obligation of the
Sellers not specifically assumed by the Buyer under Section 2.3 hereof.
2.5 PARENT AND STOCKHOLDER ACTION.
______________________________
<PAGE> 12 of 47
(a) Simultaneously with the execution of this
Agreement, the Parent, certain stockholders of the Parent and the Buyer have
entered into the Stockholders' Agreement set forth as Exhibit 2.5(a).
(b) The Parent hereby represents and warrants
that the Board of Directors of the Parent, at a meeting duly called and
held, has, with the affirmative vote of at least 66-2/3% of the members of
the Board of Directors of the Parent, (i) determined that this Agreement and
the transactions contemplated hereby are fair to and in the best interests
of the stockholders of the Sellers, (ii) approved this Agreement and the
transactions contemplated hereby, and (iii) resolved to recommend that the
stockholders of the Parent approve and adopt this Agreement.
(c) The Parent shall, promptly after the date
of this Agreement, take all action necessary in accordance with New York
Law, Federal law and the Parent's Certificate of Incorporation and By-Laws
to convene a meeting of the Parent's stockholders to approve and adopt this
Agreement. The Parent shall use its reasonable efforts to solicit from
stockholders of the Parent proxies in favor of the approval and adoption of
this Agreement.
(d) The Parent has received the oral opinion of
Daniels & Associates (the "Seller's Financial Advisor"), to the effect that
the consideration to be received by the Sellers pursuant to this Agreement
is fair to the Sellers from a financial point of view (the "Fairness
Opinion"). The Parent will deliver to the Buyer a copy of the written
Fairness Opinion to be delivered by the Seller's Financial Advisor in
connection with the stockholders meeting referred to in Section 2.5(c)
above..
ARTICLE 3
CLOSING
_______
3.1 DETERMINATION OF CLOSING DATE.
______________________________
Subject to the satisfaction or waiver of the conditions set
forth in Article 8, the date of the Closing (the "Closing Date") shall occur
on the first day of the first calendar month after the later to occur of:
(a) the consents of the FCC and any required PUC to the Assignment
Applications becoming Final Orders, or (b) if applicable, the expiration of
the waiting period pertaining to the purchase of the Assets under the Hart-
Scott-Rodino Antitrust Improvements Act of 1976, as amended (the "Antitrust
Improvements Act"); provided that if either of the foregoing occurs on or
after the twenty-fifth (25th) day of a calendar month and it is not possible
to close on the first day of the next calendar month, then the Closing shall
be held as soon as practicable after the end of such calendar month with an
effective date as of the first day of the next calendar month. In no event
shall the Closing Date occur later than February 1, 1997. The parties may
mutually agree to waive the requirement that any FCC or PUC consent shall
have become a Final Order. If Closing does not occur on or before February
1, 1997, this Agreement shall be terminable in accordance with the
provisions set forth in Article 9 hereof.
<PAGE> 13 of 47
3.2 TIME AND PLACE OF CLOSING.
__________________________
The Closing shall take place at the offices of Wilmer,
Cutler & Pickering, 2445 M Street, N.W. Washington, D.C. 20037 at 10:00 a.m.
on the Closing Date or at such other place agreed to by the Sellers and the
Buyer. The physical presence of any party or their representatives shall
not be a required condition of the Closing if such party has performed all
acts and delivered to an escrow agent all items and documents necessary for
the Closing, together with written instructions of the party which permit
such escrow agent to complete the obligations of the party in connection
with the Closing.
3.3 CLOSING DOCUMENTS.
_________________
The Sellers shall sell the Assets by delivering to the Buyer
at the Closing appropriately executed assignments, bills of sale,
endorsements, releases, termination statements, consents and other documents
and instruments of transfer necessary to transfer to the Buyer good and
marketable title to the Assets, except as set forth in Schedule 5.1.11, free
and clear of all Excluded Liabilities (the "Closing Documents"). Likewise,
the Buyer shall purchase the Assets by delivery to the Sellers at the place
and time of Closing, payments as provided herein, and all other documents
necessary to carry out the Buyer's obligations hereunder including the
assumption of the Assumed Liabilities as provided herein.
ARTICLE 4
PURCHASE PRICE, METHOD OF PAYMENT,
ALLOCATION OF PURCHASE PRICE
____________________________
4.1 PURCHASE PRICE FOR ASSETS.
_________________________
(a) Subject to and upon the terms and
conditions set forth herein, the Buyer shall pay to the Sellers (i) cash
consideration in the amount of Fifty-Five Million Dollars ($55,000,000) (the
"Cash Consideration") plus (ii) the number of shares of the Buyer's common
stock (the "Metrocall Common Stock") having a value equal to Twenty-Three
Million Five Hundred Thousand Dollars ($23,500,000) as adjusted pursuant to
Section 4.3 (items (i) and (ii) collectively the "Purchase Price"); the
value of a share of Metrocall common stock shall be equal to the average of
the last sales price per share of Metrocall Common Stock on the Nasdaq
National Market for the 20 consecutive trading days ending on the trading
day five (5) trading days immediately prior to the Closing Date, provided
that the value shall not exceed 110% of, or be less than 90% of, the average
of the last sales price per share of Metrocall Common Stock on the Nasdaq
NMS market for the 20 consecutive trading days ending on the trading date
immediately prior to the date of execution of this Agreement (such value
being the "Metrocall Stock Price").
(b) The Purchase Price shall be payable as
follows:
<PAGE> 14 of 47
(i) At the Closing, Four Million
Dollars ($4,000,000) of the Cash Consideration shall be placed in escrow as
provided by the Escrow Agreement (as defined in Section 4.5);
(ii) At the Closing, the Buyer shall pay
the remainder of the Cash Consideration, i.e., Fifty-One Million Dollars
($51,000,000) by wire transfer of immediately available funds to an account
designated by Parent; and
(iii) At the Closing, the Buyer will
issue to the Sellers the appropriate number of shares of Metrocall Common
Stock (as determined pursuant to Section 4.1(a)(ii)). The portion of the
Purchase Price payable in Metrocall Common Stock shall be subject to such
further adjustments as are specified in Sections 4.3 and 4.4.
4.2 POST-CLOSING ALLOCATION OF THE PURCHASE PRICE.
______________________________________________
Buyer shall prepare, and Buyer and Sellers shall agree to,
the allocation of the Purchase Price among the Assets to be purchased
hereunder in accordance with the procedures set forth in Schedule 4.2
hereof, which schedule shall be prepared and approved by Buyer and Sellers
prior to the Closing Date. Such allocations shall be finalized as of the
Closing Date subject to adjustment to take account of any post-closing
Purchase Price adjustments. Each of Buyer and Sellers shall (a) be bound by
such allocations for purposes of determining any taxes, (b) prepare and file
its tax returns on a basis consistent with such allocations, and (c) shall
take no position inconsistent with such allocations, in any proceeding
before any taxing authority or otherwise. In the event such allocations are
disputed by any taxing authority, the party receiving notice of the dispute
shall promptly notify the other party hereto of such dispute and any
resolution thereof.
4.3 ADJUSTMENTS TO THE PURCHASE PRICE.
_________________________________
(a) The Purchase Price shall be subject to
adjustment as follows:
(i) The Purchase Price shall be
increased or decreased by the positive or negative amount of the Working
Capital Adjustment as of the Closing Date.
(ii) The Purchase Price will be
decreased by an amount equal to the greatest of the following (the
"Operating Adjustment"):
(A) $355.58 multiplied by the
shortfall (if any) between (x) the actual number of Subscribers on the
Closing Date and (y) 220,768;
(B) the product of (1) the
shortfall (if any) between (x) four (4) times the Sellers' Pro Forma Service
Revenue immediately preceding the Closing Date and (y) $22,387,065 and (2)
3.506; or
<PAGE> 15 of 47
(C) the product of (1) the
shortfall (if any) between (x) four (4) times the Sellers' Pro Forma Defined
Operating Cash Flow immediately preceding the Closing Date and (y)
$5,938,954 and (2) 9.
(b) Not less than five (5) days prior to the
Closing Date, the Sellers shall prepare and deliver to the Buyer the
following documents, certified by Parent's chief financial officer: (i) an
unaudited consolidated balance sheet of the Sellers (the "Preliminary
Closing Balance Sheet") as of the last day of the calendar month ended not
more than thirty-one (31) days prior to the Closing Date (the "Preliminary
Adjustment Date"); (ii) a calculation of the Working Capital Adjustment as
of such date (the "Preliminary Working Capital Adjustment"); (iii)
unaudited consolidated statements of operations for the three months ended
on the Preliminary Adjustment Date (the "Preliminary Closing Operating
Statements"), which shall include statements of the Pro Forma Service
Revenue as of such date (the "Preliminary Pro Forma Service Revenue") and of
the Pro Forma Defined Operating Cash Flow as of such date (the "Preliminary
Pro Forma Cash Flow"); (iv) a calculation of the number of Subscribers at
the Preliminary Adjustment Date, supported by reasonable detail; (v) a
calculation of the Operating Adjustment, if any, that would be required
under Section 4.3(a)(ii) based on the Preliminary Closing Operating
Statements if the Closing had occurred on the Preliminary Adjustment Date
(the "Preliminary Operating Adjustment").
(c) Within sixty (60) days after the Closing
Date, the Sellers shall prepare and deliver to the Buyer the following
documents, certified by Parent's chief financial officer: (i) an unaudited
consolidated balance sheet of the Sellers (the "Closing Balance Sheet") as
of the last day of the calendar month ended immediately prior to the Closing
Date (the "Final Adjustment Date"); (ii) a calculation of the Working
Capital Adjustment as of such date (the "Final Working Capital Adjustment");
(iii) unaudited consolidated statements of operations for the three months
ended on the Final Adjustment Date (the "Closing Operating Statements"),
which shall include statements of the Pro Forma Service Revenue as of such
date (the "Final Pro Forma Service Revenue") and of the Pro Forma Defined
Operating Cash Flow as of such date (the "Final Pro Forma Defined Operating
Cash Flow"); (iv) a calculation of the number of Subscribers at the Final
Adjustment Date, supported by reasonable detail; (v) a calculation of the
Operating Adjustment under Section 4.3(a)(ii) based on the Closing Operating
Statements (the "Final Operating Adjustment").
(d) The Preliminary Balance Sheet, the Closing
Balance Sheet, the Preliminary Operating Statements, and the Closing
Operating Statements shall be prepared in accordance with the books and
records of the Sellers, and shall be prepared on a basis consistent with the
Audited Financial Statements, including GAAP, consistently applied, except
for variations identified in Schedule 5.1.10.
(e) (i) The Closing Operating Statements shall be
final and binding on the parties unless the Buyer objects, by giving written
notice within forty-five (45) days after the Buyer's receipt of the Closing
Operating Statements, to any items in the Closing Operating Statements or
the computation of the Final Pro Forma Service Revenue or the Final Pro
Forma Defined Operating Cash Flow, the calculation of the number of
Subscribers, or the calculation of the Final Operating Adjustment. The
Closing Balance Sheet shall be final and binding on the parties unless Buyer
<PAGE> 16 of 47
objects, by giving written notice within 45 days after the Buyer's receipt
of the Closing Balance Sheet, to any items in the Closing Balance Sheet or
the calculation of the Final Working Capital Adjustment. Prior to the
expiration of such 45 day period, the Buyer shall have the right to cause
its accountants to conduct procedures specified by the Buyer with respect to
the accounts and records of the Sellers in order to verify the Sellers'
calculations.
(ii) In the event of a dispute, Buyer
and Sellers will use their reasonable efforts to resolve any such dispute.
If Buyer and Sellers do not resolve any such dispute within 30 days after
receipt by Sellers of Buyer's written notice of dispute, the Buyer and
Sellers shall, within five (5) business days, submit any such unresolved
dispute to the Washington, D.C. office of a mutually acceptable big six
accounting firm (the "Accountant") which firm shall, within thirty (30) days
of such submission, resolve such remaining dispute and such resolution shall
be binding and conclusive upon the parties. The fees and expenses of the
Accountant shall be shared equally by Buyer and Sellers. If issues in
dispute are submitted to the Accountant for resolution, each party will
furnish to the Accountant such work papers and other documents and
information relating to the disputed issues as the Accountant may request
and are available to that party, and each party will be afforded the
opportunity to present to the Accountant any material relating to the
determination and to discuss the determination with the Accountant.
4.4 PAYMENT OF POST-CLOSING PURCHASE PRICE ADJUSTMENTS.
__________________________________________________
(a) At Closing, the portion of the Purchase
Price payable in Metrocall Common Stock (as valued by the Metrocall Stock
Price) to the Sellers pursuant to Section 4.1(b)(iii) will be increased or
reduced by the amount of the Preliminary Working Capital Credit Adjustment
and reduced by the amount of the Preliminary Operating Adjustment, if any.
The net amount of such adjustments is referred to herein as the Preliminary
Purchase Price Adjustment".
(b) After the final determination of the Final
Working Capital Adjustment and the Final Operating Adjustment pursuant to
Section 4.3(e)(ii), the difference, if any, between the net amount of such
adjustments (the "Final Purchase Price Adjustment") and the Preliminary
Purchase Price Adjustment (the "Final Purchase Price Adjustment Amount")
shall be paid by party owing such amount to the other by the fifth day
following such final determination. Payment shall be made by wire transfer
of immediately available funds and shall be accompanied by accrued interest
from the Closing Date to the date of payment at an annual rate equal to the
Prime Rate. The term "Prime Rate" means the rate published in the "Money
Rates" column of The Wall Street Journal as a guide to the Prime Rate, which
is currently defined as the base rate on corporate loans posted by at least
75% of the nation's 30 largest banks. If a range is published, the average
rate shall be the Prime Rate. The Prime Rate will increase or decrease each
time and as of the date the Prime Rate changes.
4.5 ESCROW AGREEMENT.
________________
<PAGE> 17 of 47
At the Closing, the Sellers and the Buyer shall enter into
the Escrow Agreement in the form set forth as Exhibit 4.5 (the "Escrow
Agreement").
ARTICLE 5
REPRESENTATIONS AND WARRANTIES
______________________________
5.1 REPRESENTATIONS AND WARRANTIES OF THE SELLERS.
______________________________________________
As of the date hereof and as of the Closing Date (unless
another date or period of time is specifically stated herein for a
representation or warranty), the Sellers jointly and severally represent and
warrant to the Buyer as follows:
5.1.1 Qualification of the Sellers. Each of the
____________________________
Sellers is a corporation duly organized, validly existing and in good
standing under the laws of the jurisdiction of incorporation. Each of the
Sellers has all requisite corporate power and authority to own and operate
the Sellers' Business as it currently is being conducted, to own and lease
the properties and assets owned or leased by it and to enter into this
Agreement and perform the obligations hereunder. Each of the Sellers is
licensed or qualified to do business as a foreign corporation and is in good
standing in each jurisdiction in which the properties owned, leased or
operated by it or the nature of the business conducted by it makes such
qualification or licensing necessary, except where the failure to be
qualified would not have a Material Adverse Effect.
5.1.2 Authorization and Validity of Agreement.
_______________________________________
The execution, delivery and performance by the Sellers of this Agreement,
the Closing Documents, and the other agreements, certificates, documents,
and instruments contemplated hereby or referred to herein and the
consummation by it of the Transaction contemplated hereby have been duly
authorized by all necessary corporate action of the Sellers, subject to
approval by Sellers' stockholders as required under New York law. This
Agreement has been duly executed and delivered by each of the Sellers and,
assuming the due authorization, execution, and delivery hereof by the Buyer,
is a legal, valid and binding obligation of each of the Sellers, enforceable
against each Seller, in accordance with its terms, except as and to the
extent such enforceability may be subject to bankruptcy or similar laws
affecting creditors rights.
5.1.3 No Violation of Law; No Approvals or
____________________________________
Notices Required; No Conflict with Instruments to which the Sellers are
_______________________________________________________________________
Party. Each of the Sellers is currently in compliance in all material
_____
respects with all laws, rules, regulations, ordinances, decrees, judgments,
and orders (collectively, "Laws") applicable to the operation of its
Business and the ownership of its assets, except where noncompliance would
not have a Material Adverse Effect. Except as disclosed on Schedule 5.1.3,
the execution, delivery and performance by the Sellers of this Agreement and
the consummation by them of the Transaction contemplated hereby: (i) will
<PAGE> 18 of 47
not violate (with or without the giving of notice or lapse of time or both)
any Law applicable to the Sellers or the Sellers' Business; (ii) will not be
in conflict with, or result in the breach of, or constitute a default under,
or cause acceleration of the maturity of amounts outstanding or other
obligations pursuant to, or require the consent of or give rise to any
rights of first refusal of any third party under, any agreement or other
instrument to which any Seller is a party or by which such Seller's
properties or business is bound or affected; (iii) will not require any
consent or approval of, or filing or notice to, any governmental or
regulatory authority under any Law applicable to the Sellers or the Sellers'
Business, except for (a) the Assignment Applications, (b) filing under the
Antitrust Improvements Act, (c) any consent, approval, filing or notice that
would not, if not given or made, individually or in the aggregate, have a
Material Adverse Effect and (d) filings required pursuant to the Securities
Exchange Act of 1934; (iv) will not result in the creation of any Liens
except Permitted Liens (as such term is defined in Section 5.1.5) upon any
of the Assets, which Liens, in the aggregate with all other such Liens so
created, would have a Material Adverse Effect; and (v) will not violate any
provision of the charter or bylaws of any Seller.
5.1.4 Licenses, Compliance with Law.
_____________________________
(a) The Sellers are the holders of the
Licenses listed in Schedule 5.1.4(a). The Licenses so listed constitute all
of the Licenses issued or required by the FCC, any PUC, and all material
Licenses and other authorizations issued by any other governmental agency
that are required for and/or used in the operation of the Sellers' Business
as currently operated. Each of the Licenses is in full force and effect
and, except as disclosed in Schedule 5.1.4(a), the Sellers are in compliance
in all material respects with the terms and requirements thereof and all
FCC, PUC and other governmental regulations pertaining thereto. There is
not pending or, to the Sellers' knowledge, threatened, any action,
investigation, complaint or other proceeding by or before the FCC, any PUC
or any other governmental agency to revoke, cancel, suspend, modify or
refuse to renew, or otherwise relating to, any of the Licenses (except such
actions, investigations, complaints, or other proceedings which relate to
the paging industry generally and do not relate to any specific License).
There is not issued, pending or, to the Sellers' knowledge, threatened, any
notice of violation or complaint by the FCC, any PUC or any other
governmental agency against the Sellers with respect to the Sellers'
Business or the Transaction contemplated hereby.
(b) Accurate and complete copies of all
of the Licenses will be delivered to the Buyer within five (5) business days
after the execution of this Agreement. Accurate and complete copies of all
of the Licenses granted by the FCC and any PUC after the date hereof and
prior to Closing, will be delivered to the Buyer by the Sellers prior to the
Closing Date. All of the Licenses previously delivered to the Buyer contain
and, upon delivery to the Buyer as provided above, the Licenses granted by
the FCC and any PUC after the date hereof and prior to Closing will contain
no defect which would cause a Material Adverse Effect. However, Sellers
acknowledge that the Licenses most recently issued by the FCC contain some
inaccuracies. Seller shall promptly file with the FCC requests for the
correction of the Licenses, and shall use their best effort to obtain
corrected Licenses prior to Closing. Upon filing of such requests with the
FCC, Sellers shall provide date-stamped copies of same to Buyer.
<PAGE> 19 of 47
(c) The Sellers have complied with, and
are in compliance with, all federal, state, county, and local laws,
regulations, and orders that are applicable to the Sellers' Business,
including, but not limited to, the rules and regulations of the FCC, the
FAA, and the states and municipalities in which the Sellers' Business is
located, and has timely filed with the proper authorities all statements and
reports required by the laws, regulations, and orders to which the Sellers
and the Sellers' Business are subject, except where noncompliance would not
have a Material Adverse Effect.
5.1.5 Title to Properties, Liens and
______________________________
Encumbrances. Except as disclosed on Schedule 5.1.11, the Sellers are the
____________
true and lawful owner of the Assets, have good and marketable title to the
Real Property interests described in Schedule 2.1 (for those properties
which, as indicated on Schedule 2.1, are owned by the Sellers), hold by
valid and subsisting lease or license those Real Property interests
described on Schedule 5.1.11 that are not indicated on such Schedule to be
owned by Sellers, have good and marketable title to all of the other Assets
(subject, with respect to the Licenses, to procuring the consent of the FCC
and, if applicable, any PUC to the transfer or assignment of such Licenses
as described in clause (iii)(a) of Section 5.1.3) in each case, free and
clear of any Lien other than (a) Liens for taxes not yet delinquent, (b)
Liens set forth in Schedule 5.1.5, (c) purchase money security interests
securing liabilities that will be Assumed Liabilities after the Closing, and
(d) Liens and defects in title that are not, in the aggregate, material to
the Sellers' Business (the Liens identified in clauses (a), (c) and (d)
above being herein referred to as "Permitted Liens"). Subject to obtaining
the approval of the stockholders of the Sellers and the necessary consents
described on Schedule 5.1.3, the Sellers have all necessary power and
authority to sell the Assets to the Buyer free and clear of all Liens other
than the Permitted Liens. Upon delivery to the Buyer of the Closing
Documents, on the Closing Date, the Sellers will transfer good title to the
Assets free and clear of any Liens, equities, covenants, and restrictions
other than Permitted Liens which have been disclosed to the Buyer.
5.1.6 Taxes. With respect to the sales, excise
_____
or use taxes, property taxes, income taxes, state and federal income tax
withholding, social security, and unemployment compensation taxes and all
other taxes relating to the operation of the Sellers' Business prior to
Closing, the Sellers have filed, or shall have filed, on or before the
Closing Date, proper and timely tax returns with respect thereto except only
for such returns as shall be final returns for the last tax period for each
such tax, which returns shall be filed by the Sellers on or before their
respective due dates, as extended. All taxes, fees, and assessments of
whatever nature due and payable by the Sellers have been paid, except such
amounts (i) as are being contested diligently and in good faith and are not
in the aggregate material to the Sellers' Business and (ii) as relate to
final returns described in the preceding sentence, which shall be paid by
the Sellers. Except as set forth on Schedule 5.1.6, there are no
outstanding agreements or waivers extending the statutory period of
limitations applicable to any federal, state, local, or foreign income tax
return for any period, and except as set forth on Schedule 5.1.6, there are
no tax audits pending.
<PAGE> 20 of 47
5.1.7 Litigation. Except as described in
__________
Schedule 5.1.7, there is no litigation, claim, action, suit, proceeding or
governmental investigation pending or, to the Sellers' Knowledge, threatened
against the Sellers which (i) could reasonably be expected to have,
individually or in the aggregate with all such other litigation, claims,
actions, suits, proceedings and governmental investigations, a Material
Adverse Effect or (ii) seeks to restrain or enjoin the consummation of the
Transaction. The Sellers are not in violation of any term of any judgment,
decree, injunction or order outstanding against them, which violation could
reasonably be expected to have, individually or in the aggregate with all
such other violations, a Material Adverse Effect.
5.1.8 Insurance. The Sellers maintain adequate
_________
insurance with respect to the Business, and the Sellers are in compliance
with all material requirements and provisions thereof.
5.1.9 Condition of System. All antennas, pager
___________________
equipment, facilities and installations that are included in the Assets have
in all material respects been constructed, completed and maintained in a
proper manner, are in all material respects operable.
5.1.10 Financial Statements. Attached hereto as
____________________
Schedule 5.1.10 are true and complete copies of the audited balance sheets
of the Sellers as of December 31, 1994 and 1995 and the related consolidated
statements of operations and cash flow for each of the fiscal years in the
three fiscal-year period ending December 31, 1995 (collectively, including
the notes thereto, the "Audited Financial Statements"). The Audited
Financial Statements have been prepared in accordance with the books and
records of the Sellers and present fairly the financial position and the
results of operations and cash flows of the Sellers as of the dates or for
the periods set forth therein. The Audited Financial Statements have been
prepared in accordance with GAAP, consistently applied, except for the
material variations set forth on Schedule 5.1.10. From the date of
execution of this Agreement until the Closing, Sellers shall provide Buyer
no later than thirty (30) business days after the first day of each
calendar month, an unaudited consolidated balance sheet of the Sellers as
of the last day of the preceding calendar month, and unaudited statements of
operations for the period ended on such date..
5.1.11 Interests in Real Property. Except as set
__________________________
forth on Schedule 5.1.11, the Sellers do not have fee simple title to any
Real Property. Schedule 5.1.11 attached hereto comprises a true and
complete list and a brief description of all Real Property leased or
otherwise used by the Sellers which is material to the Sellers' Business,
including all structures thereon. Except as otherwise disclosed on
Schedule 5.1.11, the Sellers have valid leasehold interests in the Real
Property leased by the Sellers and, with respect to other Real Property not
leased by the Sellers, the Sellers have the right to use all such other Real
Property which is material to the Sellers' Business pursuant to the
easements, licenses, rights-of-way or other rights described on Schedule
5.1.11. The documents listed on Schedule 5.1.11 by the Sellers (the
Sellers' rights to which will be conveyed to the Buyer at the Closing as
<PAGE> 21 of 47
part of the Assets and which have been made available to the Buyer for
review prior to the date hereof) as evidence of each lease of Real Property
constitute the entire agreement with the landlord in question. All
easements, rights-of-way and other rights appurtenant to, or which are
necessary for the Sellers' current (through the Closing Date) use of, any
Real Property which is material to the Sellers' Business are valid and in
full force and effect, and the Sellers have not received any notice with
respect to the termination or breach of any of such rights. Each parcel of
Real Property which is material to the Sellers' Business, any improvements
constructed thereon and their current use conform in all material respects
to (a) all applicable legal requirements, including zoning requirements and
the Americans with Disabilities Act, and (b) all restrictive covenants, if
any, or other encumbrances affecting all or part of such parcel.
5.1.12 Interest in Personal Property. Schedule
_____________________________
2.1 contains a true and complete list and brief description of all
capitalized inventory, equipment, machinery, and furniture, and other
personal property of the Sellers, which comprises in all material respects
all personal property presently used by the Sellers in the ordinary course
of business, all such personal property is free and clear of title defects,
Liens (other than Permitted Liens and those Liens described in Schedule
5.1.5) and objections, of any nature whatsoever, and the Sellers have good
and marketable title thereto. The Sellers' interest in all other personal
property used in the ordinary course of the Sellers' Business which is
material to the Seller's Business will be conveyed to the Buyer when the
Buyer takes possession of the Assets upon the Closing. All such inventory,
equipment, machinery, furniture and other personal property described in
this Section 5.1.12 are in safe, fully operable condition in all material
respects, normal wear and tear excepted.
5.1.13 Environmental Matters/Representations and
_________________________________________
Warranties.
__________
(a) The Sellers' Business has been
operated by the Sellers in compliance with all Environmental Laws, except
for any noncompliance which would not result individually or in the
aggregate in a Material Adverse Effect. Neither the Sellers nor, to the
Sellers' knowledge, any third party has generated, released, stored, used,
treated, handled, discharged or disposed of any Hazardous Substances at, on,
under, in or about, or in any other manner materially affecting any Real
Property, transported any Hazardous Substances to or from any Real Property
in violation of an Environmental Law or discharged any Hazardous Substances
from any Real Property into any body of water in violation of an
Environmental Law. To the Sellers' knowledge, no release of Hazardous
Substances outside the Real Property has entered or threatens to enter the
Real Property. To the Sellers' knowledge, no claim or investigation by the
United States Environmental Protection Agency or a similar state agency,
based on Environmental Laws which relate to any Real Property or any
operation on the Real Property, (i) is currently pending against or with
respect to the Sellers or (ii) to the Sellers' Knowledge, is threatened.
(b) To the Sellers' knowledge, (i) no
underground storage tanks are currently located on any of the Real Property,
(ii) no Real Property has been used since the property was leased by the
<PAGE> 22 of 47
Sellers as a gasoline service station or any other facility for storing,
pumping, dispensing, or producing gasoline or any other petroleum products
or waste.
(c) The Sellers will provide the Buyer
with complete and correct copies of (i) any environmental assessments the
Sellers has obtained with respect to any of its paging transmitter sites,
(ii) all notices or other materials in the Sellers' possession that were
received from any governmental authority having the power to administer or
enforce any Environmental Laws relating to current or past ownership, use or
operation of Real Property or activities at the Real Property and (iii) all
materials in the Sellers' possession relating to any claims, allegations, or
actions by any private third party under any Environmental Law which would
materially affect this Agreement.
5.1.14 Contracts. Schedule 5.1.14 attached hereto
_________
describes all currently effective material contracts, oral or written, to
which any Seller is a party and which (i) relate to a reseller contract
involving more than 250 paging units or a direct contract involving more
than 50 paging units, (ii) involve the payment of more than $15,000, (iii)
have a duration of more than one year after the Closing Date, (iv) are
financing documents, or (v) are not for the purchase, sale or license of
goods or services in the ordinary course of business consistent with past
practice. True and complete copies of all such contracts have been provided
to the Buyer. None of the Sellers nor, to the Sellers' knowledge, any other
party to any such contract is in material default in the performance of, or
is not in compliance with any material provision of any such contract
relating to the Sellers' Business. The Sellers have no intention, and no
knowledge of any intention by any other party, not to perform its
obligations under any such contract.
5.1.15 Transferability of Contract Rights. Except
__________________________________
as set forth on Schedule 5.1.15, the Sellers have the right to assign all
material leases, accounts receivable, and other contractual rights of the
Sellers set forth on Schedules 5.1.11 and 5.1.14. Except as set forth on
Schedule 5.1.15, neither the assignment of such rights nor the consummation
of the Transaction contemplated by this Agreement would give any party to a
contract listed on Schedule 5.1.14 the right to terminate or alter the terms
of such contract. The Sellers shall use reasonable efforts to obtain, on or
before the Closing Date, the right to assign the items set forth on Schedule
5.1.15.
5.1.16 Personnel Benefits; Bonuses. Schedule
___________________________
5.1.16 attached hereto comprises a complete and correct list of: (a) all
contractual employment, bonus, welfare benefit (as that term is defined in
the Employee Retirement Income Security Act ("ERISA")), percentage
compensation, contracts or agreements with directors, officers, shareholders
or employees, collective bargaining or consulting agreements, to which any
Seller is a party or is subject, (b) the names and current compensation
rates and planned increases in compensation for 1996 of all salaried
employees of the Sellers who are eligible to become Transferred Employees
pursuant to Article 7 hereof, (c) the wage rates for the non-salaried
employees of the Sellers by classification, and (d) all group insurance
programs in effect for employees of the Sellers. Schedule 5.1.16 sets forth
<PAGE> 23 of 47
a listing of all bonuses paid to management employees of the Sellers in
calendar year 1995 who are eligible to become Transferred Employees
hereunder and all bonuses in excess of $1,000 per individual paid to other
employees of the Sellers in calendar year 1995 who are eligible to become
Transferred Employees hereunder.
5.1.17 Assets.
______
(a) The Assets (as set forth in Section
2.1) include all assets and properties necessary to operate the Sellers'
Business in all material respects in the manner it has been operated prior
to the date hereof and prior to the Closing Date.
(b) The Sellers shall deliver to the
Buyer, on or before the Closing Date, a true and complete list of the
Subscribers and the number and type (digital, alpha, etc.) of pagers in
service on the Sellers' system as of the Closing Date. All of such pagers
shall be operating pursuant to valid and binding rental and/or service
agreements with the Sellers or their agents and representatives.
5.1.18 Transactions with Affiliates. Except as
____________________________
set forth on Schedule 5.1.18, since January 1, 1993, there have been no
transactions, contracts, understanding or agreements ("Affiliated
Transactions") of any kind between the Sellers and any Affiliate of the
Sellers.
5.1.19 Absence of Certain Changes or Events. From
____________________________________
December 31, 1995 to the date hereof, except as disclosed in the Financial
Statements, or as otherwise consented to in writing by the Buyer, the
Sellers' Business has been operated only in the ordinary course (except as
expressly contemplated by this Agreement), and there has not been any:
(a) Material Adverse Change;
(b) sale, assignment or transfer, other
than in the ordinary course of business and consistent with past practice,
of any of the Assets, which Assets are material individually or in the
aggregate to the Sellers;
(c) acquisition by merger,
consolidation with, purchase of substantially all of the assets or capital
stock of, or any other acquisition of any material assets or business of,
any corporation, partnership, association or other business organization or
division thereof;
(d) change in accounting methods or
practices by the Sellers, except as required by GAAP;
(e) entry into, or termination,
amendment or modification of, any contract, agreement, commitment,
transaction, License, permit or other instrument (including, without
limitation, any borrowing, capital expenditure, capital contribution or
capital financing) which is or was material to the Sellers' Business;
<PAGE> 24 of 47
(f) any action taken by any Seller
that, if taken after the date hereof, would constitute a breach of any of
the covenants set forth in Section 6.7; or
(g) agreement by any Seller to do any
of the foregoing.
5.1.20 Metrocall Common Stock. It is understood
______________________
that the shares of the Metrocall Common Stock to be delivered to the Sellers
pursuant to this Agreement are being registered on Form S-4 prior to Closing
for purposes of the transactions hereunder, pursuant to the Securities Act
of 1933 (the "Securities Act"). Notwithstanding the foregoing, the Sellers
are acquiring the Metrocall Common Stock hereunder without a present
intention of resale or distribution in violation of the Securities Act,, and
shall not sell or otherwise transfer such shares except when such sale or
transfer is made in compliance with the Securities Act and all applicable
state laws.
5.2 REPRESENTATIONS AND WARRANTIES OF THE BUYER.
___________________________________________
As of the date hereof and as of the Closing Date (unless
another date or period of time for a representation or warranty is
specifically stated herein), the Buyer represents and warrants to the
Sellers as set forth below:
5.2.1 Qualification of the Buyer. The Buyer is a
__________________________
corporation duly organized, validly existing and in good standing under the
laws of the State of Delaware. The Buyer has all requisite corporate power
and authority to own and operate its business as it currently is being
conducted, to own and lease the properties and assets owned or leased by it
and to enter into this Agreement and perform the obligations hereunder. The
Buyer is licensed or qualified to do business as a foreign corporation and
is in good standing in each jurisdiction in which the properties owned,
leased or operated by it or the nature of the business conducted by it makes
such qualification or licensing necessary.
5.2.2 Authorization and Validity of Agreement.
_______________________________________
The execution, delivery and performance by the Buyer of this Agreement, the
Closing Documents, and the other agreements, certificates, documents, and
instruments contemplated hereby or referred to herein and the consummation
by it of the Transaction contemplated hereby have been duly authorized by
all necessary corporate action of the Buyer. This Agreement has been duly
executed and delivered by the Buyer and, assuming the due authorization,
execution, and delivery hereof by the Sellers, is a legal, valid and binding
obligation of the Sellers, enforceable against the Buyer, in accordance with
its terms, except as and to the extent such enforceability may be subject to
bankruptcy or similar laws affecting creditors rights.
<PAGE> 25 of 47
5.2.3 No Violation of Law; No Approvals or
____________________________________
Notices Required; No Conflict with Instruments to which the Buyer is a
______________________________________________________________________
Party. The Buyer has complied with and is currently in compliance in all
_____
material respects with all laws, rules, regulations, ordinances, decrees,
judgments, and orders (collectively, "Laws") applicable to the operation of
its business and the ownership of its assets. The execution, delivery and
performance by the Buyer of this Agreement and the consummation by it of the
Transaction contemplated hereby: (i) will not violate (with or without the
giving of notice or lapse of time or both) any Law applicable to the Buyer
or its business; (ii) will not be in conflict with, or result in the breach
of, or constitute a default under, or cause acceleration of the maturity of
amounts outstanding or other obligations pursuant to, or require the consent
of or give rise to any rights of first refusal of any third party under, any
agreement or other instrument to which the Buyer is a party or by which its
properties or business is bound or affected; (iii) will not require any
consent or approval of, or filing or notice to, any governmental or
regulatory authority under any Law applicable to the Buyer or its business,
except for (a) the Assignment Applications and other notice filings at the
PUC's in the states as set forth on Schedule 5.1.3 hereof, (b) filing under
the Antitrust Improvements Act, and (c) any consent, approval, filing or
notice that would not, if not given or made, individually or in the
aggregate, have a material adverse effect on the Buyer's business; and (iv)
will not violate any provision of the charter or bylaws of the Buyer.
5.2.4 Litigation. There is no litigation, claim,
__________
action, suit, proceeding or governmental investigation pending or, to the
Buyer's knowledge, threatened against the Buyer which (i) could reasonably
be expected to have, individually or in the aggregate with all such other
litigation, claims, actions, suits, proceedings and governmental
investigations, a material adverse effect on the Buyer's business or (ii)
seeks to restrain or enjoin the consummation of the Transaction. The Buyer
is not in violation of any term of any judgment, decree, injunction or order
outstanding against it, which violation could reasonably be expected to
have, individually or in the aggregate with all such other violations, a
material adverse effect on the Buyer's business.
5.2.5 Qualification. The Buyer is fully
_____________
qualified under the Communications Act of 1934, as amended, and all FCC
rules and regulations, to be the licensee of the Sellers' Business. The
Buyer has not taken, and will not take, any knowing or voluntary action to
render the Buyer disqualified under the FCC's rules and regulations to
purchase the Assets on the Closing Date. There are no actions pending or,
to the Buyer's knowledge, threatened against the Buyer or any director or
officer of the Buyer that challenge the qualifications of the Buyer to hold
the Licenses.
5.2.6 Financial Capabilities. The Buyer has the
______________________
financial ability to consummate the Transaction, and has uncommitted cash or
cash equivalents or commitments from financial institutions or its
shareholders for funds in amounts equal to or greater than the Purchase
Price.
<PAGE> 26 of 47
5.2.7 Capital Stock of Buyer. The duly
______________________
authorized capital stock of Buyer consists of 20,000,000 shares of Common
Stock, par value $.01 per share, and 1,000,000 shares of Preferred Stock,
par value $.01 per share. As of December 31, 1995, no shares of Preferred
Stock were outstanding and 14,626,255 shares of Common Stock were issued and
outstanding. All of the issued and outstanding shares of capital stock of
Buyer have been duly and validly issued and are fully paid and
nonassessable. Except pursuant to the Buyer's stock option plans or as
disclosed in the SEC Filings (as hereinafter defined), there are no
outstanding options, warrants or other rights to subscribe for or purchase
or otherwise acquire any shares of capital stock (or securities directly or
indirectly convertible into or exchangeable or exercisable for shares of
capital stock) of the Buyer.
5.2.8 Financial Statements and Reports. Buyer
_________________________________
has furnished to the Sellers copies of (i) the Buyer's Annual Report on Form
10-K for the fiscal year ended December 31, 1995, and (ii) all other
reports, statements and registration statements filed by the Buyer with the
Securities and Exchange Commission since December 31, 1995 (collectively,
the "SEC Filings"). The SEC Filings were prepared and filed in accordance
with the rules and regulations of the SEC. As of their respective dates,
the SEC Filings did not contain any untrue statement of a material fact or
omit to state any material fact required to be stated therein or necessary
to make the statements therein, in light of the circumstances under which
they were made, not misleading. The financial statements of Buyer included
in the SEC Filings were prepared in accordance with generally accepted
United States accounting principles as in effect from time to time applied
on a consistent basis (except as otherwise noted in such financial
statements) and present fairly the consolidated financial condition, results
of operations and cash flows of Buyer as of the dates and for the periods
indicated, subject, in the case of interim financial statements, to normal
year end audit adjustments. Since September 30, 1995, (a) the Buyer has
conducted its business in a manner generally consistent with prior practice
and in the ordinary course, (b) there has not been any adverse change in the
business, operations or financial condition of the Buyer which could
reasonably be expected to result in a material adverse change in the Buyer
taken as a whole and (c) there has not been any damage, destruction or loss
affecting the business, assets, properties or rights of the Buyer which
could reasonably be expected to result in a material change in the Buyer
taken as a whole.
5.2.9 Common Stock of Buyer. The Metrocall
_____________________
Common Stock to be issued to the Sellers pursuant to this Agreement, when so
issued, will be duly and validly authorized and issued, fully paid and
nonassessable and the Sellers will acquire good and valid title thereto,
free and clear of any preemptive rights or Liens created by Buyer, subject
to prior notice of issuance being given to the Nasdaq Stock Market.
<PAGE> 27 of 47
ARTICLE 6
CONDUCT PRIOR TO CLOSING
________________________
6.1 FILING OF ASSIGNMENT APPLICATIONS.
_________________________________
As soon as practicable, the Buyer and the Sellers shall join
in and file the Assignment Applications with the FCC, any PUC and any
similar applications required by other agencies. The parties will cooperate
and use best efforts to prosecute such applications diligently and
expeditiously to a favorable conclusion. The Sellers and the Buyer mutually
agree to provide, in a timely manner, whatever additional information the
FCC, any PUC or other agency may request in processing such applications.
6.2 ANTITRUST LAWS AND THE SELLERS.
______________________________
The Sellers will, or will cause their "ultimate parent" to,
timely and promptly make all filings which are required under the Antitrust
Improvements Act. The Sellers will furnish to the Buyer such information
and assistance as the Buyer may reasonably request in connection with its
preparation of necessary filings or submissions to any governmental agency,
including, without limitation, any filings necessary under the provisions of
the Antitrust Improvements Act. The Sellers will supply the Buyer with a
copy of any correspondence, filing or communication (or memorandum setting
forth the substance thereof) between the Sellers or their "ultimate parent"
or their respective representatives, on the one hand, and the FTC, the DOJ
or any other governmental agency or authority or members of their respective
staffs, on the other hand, with respect to this Agreement or the Transaction
contemplated hereby to the extent that any such correspondence, filing,
communication or memorandum is required by the Buyer to meet its obligations
under the Antitrust Improvements Act.
6.3 ANTITRUST LAWS AND THE BUYER.
____________________________
The Buyer will, or will cause its "ultimate parent" to,
timely and promptly make all filings which are required under the Antitrust
Improvements Act. The Buyer will furnish to the Sellers such information
and assistance as the Sellers may reasonably request in connection with its
preparation of necessary filings or submissions to any governmental agency,
including, without limitation, any filings necessary under the provisions of
the Antitrust Improvements Act. The Buyer will supply the Sellers with a
copy of any correspondence, filing or communication (or memorandum setting
forth the substance thereof) between the Buyer or its "ultimate parent" or
their respective representatives, on the one hand, and the FTC, the DOJ or
any other governmental agency or authority or members of their respective
staffs, on the other hand, with respect to this Agreement or the Transaction
contemplated hereby to the extent that any such correspondence, filing,
communication or memorandum is required by the Sellers to meet their
obligations under the Antitrust Improvements Act.
<PAGE> 28 of 47
6.4 ACCESS TO INFORMATION CONCERNING SELLERS' BUSINESS.
__________________________________________________
Prior to the Closing Date, the Sellers shall, upon
reasonable request, afford to the Buyer, its counsel, accountants and other
authorized representatives, reasonable access during normal business hours
to all plants, properties, books, accounts, contracts, documents, and
records of the Sellers to the extent they relate to the Sellers' Business,
the Assets or the Transaction in order that they may have the opportunity to
make such reasonable investigations as they shall desire to make of the
affairs of the Sellers' Business. The Sellers will furnish to the Buyer
such existing data and information concerning the Sellers' Business,
finances and properties that the Buyer may reasonably request and such
additional existing financial, operating data and billing information as the
Buyer shall from time to time reasonably request to facilitate the efficient
transfer of billing and other accounting and management functions. Prior to
Closing, the Sellers will afford the Buyer with reasonable access to the
vendors, employees, and officers of the Sellers and will otherwise cooperate
in all measures reasonably necessary to ensure the uninterrupted
continuation of the business under Buyer's control after the Closing,
provided that the Buyer will give the Sellers reasonable notice prior to the
Buyer's contacting any vendor, employee, or officer. At the request of the
Buyer for a period of two years after the Closing Date, the Sellers shall
provide to the Buyer any historical financial information requested by the
Buyer concerning the Sellers and in the possession of the Sellers, and shall
cooperate with the Buyer and assist the Buyer, at the Buyer's reasonable
request and at the Buyer's expense, in preparing any such financial
information that is not in the possession of the Seller, in each case to
permit the Buyer (or an affiliate of the Buyer) to meet any requirements
that are or may become applicable to the Buyer (or such affiliate) under the
Securities Exchange Act of 1934, as amended, and the rules and regulations
promulgated under such acts, and/or any other Law.
6.5 CONFIDENTIALITY.
_______________
(a) The Buyer agrees that it will, and will
cause its associates, affiliates, officers, other personnel and authorized
representatives to, hold in strictest confidence all Confidential
Information, and will not, and will ensure that such other persons do not,
disclose such information to others without the prior written consent of the
Sellers; provided that the Buyer and such other persons may provide such
data and information (i) to lenders, subject to the same requirements of
confidentiality as set forth in this Agreement, or (ii) which is legally
required to be furnished, and provided that the Buyer or such other person,
as the case may be, notifies the Sellers in advance of its obligation to
provide such confidential information and fully cooperates with the Sellers
to protect the confidentiality of such data and information.
(b) Each Seller agrees that it will, and will
cause its associates, affiliates, officers, other personnel and authorized
representatives to, hold in strictest confidence all confidential
information related to the Buyer's business, and will not, and will ensure
that such other persons do not, disclose such information to others without
the prior written consent of the Buyer; provided that such Seller and such
other persons may provide such data and information which is legally
<PAGE> 29 of 47
required to be furnished, and provided that such Seller or such other
person, as the case may be, notifies the Buyer in advance of its obligation
to provide such confidential information and fully cooperates with the Buyer
to protect the confidentiality of such data and information.
(c) Notwithstanding the foregoing provisions of
this Section 6.5, the parties have agreed that any press release or public
announcement with respect to the Transaction will be issued at such time
after the execution of the Agreement and in such manner as the Buyer shall
determine after notice to the Sellers, subject to compliance with all
applicable Laws.
6.6 CONTROL OF THE SELLERS' BUSINESS.
_________________________________
The Transaction contemplated by this Agreement shall not be
consummated until the Closing Date. Between the date of this Agreement and
the Closing Date, the Buyer and its employees or agents shall not directly
or indirectly control, supervise, or direct, or attempt to control,
supervise, or direct, the conduct or operation of the Sellers' Business, and
notwithstanding any other provision of this Agreement, such operation and
conduct shall be the sole responsibility, and in the complete discretion, of
the Sellers; provided, however, that this Section 6.6 shall not limit the
specific rights and obligations of the Buyer and the Sellers set forth in
this Agreement, none of which are intended to confer control of the Sellers
or of the Sellers' Business to the Buyer.
6.7 THE SELLERS' PRE-CLOSING COVENANTS.
__________________________________
Except as otherwise consented to in writing by the Buyer,
each Seller covenants that, throughout the period commencing on the date
hereof and ending on the Closing Date, it shall:
(a) conduct the Sellers' Business only in the
ordinary course;
(b) maintain and keep its material properties,
machinery and equipment used in the Sellers' Business in the same condition
in all material respects as at present, except for ordinary wear and tear;
(c) not enter into any agreement for the
purchase, sale or other disposition, or purchase, sell or dispose of, any
equipment, supplies, inventory, investments or other assets, except for
sales of inventory and purchases of equipment, materials and supplies in the
ordinary course of business consistent with past business practices;
(d) consistent with its past business
practices, perform all its material obligations under material contracts,
leases and documents relating to or affecting the Sellers' Business and,
consistent with past business practices, pay all accounts payable which
become due according to their terms prior to the Closing Date;
<PAGE> 30 of 47
(e) consistent with its past business
practices, use its reasonable efforts to maintain and preserve the Sellers'
Business including, but not limited to, maintaining and preserving the
Licenses and prosecuting diligently all applications for Licenses, including
any renewal applications;
(f) comply with and perform in all material
respects all obligations and duties imposed upon it by all federal, state
and local laws and all rules, regulations and orders imposed by federal,
state or local governmental authorities;
(g) maintain its existence as a corporation
validly existing and in good standing under the laws of its state of
incorporation;
(h) use its best reasonable efforts to assure,
to the extent within its control, as soon as is reasonably practicable, the
satisfaction of the conditions required to consummate the Transaction,
including but not limited to, the filing and prosecution of all requests for
regulatory approvals, and obtaining necessary third party consent;
(i) use its best reasonable efforts to obtain,
as soon as practicable after the date hereof, the approvals described in
Section 8.2.6 below;
(j) at its sole cost and expense, attempt to
cure all noncompliance by the Sellers with the terms and conditions of
Licenses issued by the FCC, including such noncompliance as is set forth on
Schedule 5.1.4(a), and pay when due all costs (including attorneys' fees),
damages, liabilities, fines and penalties arising out of such noncompliance;
and
(k) promptly notify the Buyer upon the Sellers'
knowledge thereof of any fact, event, circumstance, or action (i) which, if
known on the date hereof would have been required to be disclosed to the
Buyer, or (ii) the existence or occurrence of which would cause any of the
Sellers' representations or warranties not to be correct and complete in all
material respects.
6.8 THE BUYER'S PRE-CLOSING COVENANTS.
_________________________________
Except as otherwise consented to in writing by the Sellers,
the Buyer covenants that, throughout the period commencing on the date
hereof and ending on the Closing Date, it shall:
(a) consistent with its past business
practices, use its reasonable efforts to maintain and preserve its business;
(b) maintain its existence as a corporation
validly existing and in good standing under the laws of its state of
incorporation;
(c) use its best reasonable efforts to
assure, to the extent within its control, as soon as is reasonably
practicable, the satisfaction of the conditions required to consummate the
Transaction contemplated in this Agreement, including but not limited to,
<PAGE> 31 of 47
the filing and prosecution of all requests for regulatory approvals, and
obtaining necessary third party consent; and
(d) use its best reasonable efforts to obtain,
as soon as practicable after the date hereof, the approvals described in
Section 8.2.6 below.
6.9 NO SOLICITATION OF OFFERS.
_________________________
Unless and until this Agreement shall have been terminated
by either party pursuant to Article 9 hereof, each Seller covenants that
following the date hereof it will not (and shall use its best efforts to
ensure that none of its stockholders, officers, directors, agents,
representatives or affiliates) take or cause, directly or indirectly, any of
the following actions with any party other than the Buyer or its designees:
(i) solicit, initiate, or participate in any negotiations, inquiries or
discussions with respect to any offer or proposal to acquire all or a
significant part of the Sellers' business, assets or capital shares whether
by merger, consolidation, other business combination, purchase of assets,
tender or exchange offer or otherwise (each of the foregoing, an
"Acquisition Proposal"); (ii) disclose, in connection with an Acquisition
Proposal, any information (except to the extent that such party would be
permitted to do so under the provisions of Section 6.5 hereof) with respect
to, or otherwise cooperate in any way with, or assist or participate in, any
effort or attempt by any other Person to do or seek any of the foregoing;
(iii) enter into or execute any agreement relating to an Acquisition
Proposal; or (iv) make or authorize any public statement, recommendation or
solicitation in support of any Acquisition Proposal other than with respect
to the transactions contemplated by this Agreement; provided however, that
nothing contained herein shall prohibit the Sellers from taking any of the
actions specified above if, in each case, its Board of Directors determines
in good faith, after consultation with legal counsel, that such action is
required by the fiduciary duties of such directors under applicable state
law. Each Seller shall immediately cease and cause to be terminated all
existing discussions or negotiations with any parties conducted heretofore
with respect to any of the foregoing. In the event a Seller shall receive
any Acquisition Proposal, directly or indirectly, of the type referred to in
clause (i) above, or any request for disclosure with respect to information
of the type referred to in clause (ii) above, it shall, prior to taking any
action in response thereto, inform Buyer of such fact and shall, in any such
notice to Buyer, indicate in reasonable detail the identity of the Person
making such proposal, offer, inquiry or contact and the terms and conditions
of such proposal, offer, inquiry or contact. Subject to the fiduciary
obligations of the directors and officers under applicable law, Sellers
agree not to release any third party from, or waive any provision of, any
confidentiality or standstill agreement to which such Seller is a party.
Notwithstanding the foregoing, the Sellers may not enter into a definitive
agreement to transfer the Assets or any portion of the Sellers' Business to
any third party until and unless this Agreement has been terminated pursuant
to Article 9 hereof.
6.10 RISK OF LOSS.
____________
The Sellers will bear the risk of loss or damage to the
Assets resulting from fire, theft, or other casualty at all times prior to
<PAGE> 32 of 47
Closing. If any such loss or damage is so substantial as to prevent normal
operation of any material portion of the Sellers' Business or the
replacement or restoration of the lost or damaged material Asset within 30
days after the occurrence of the event resulting in such loss or damage, the
Sellers will immediately notify the Buyer and the Buyer, at any time within
10 days after receipt of such notice, may elect by written notice to the
Sellers either (a) to waive such defect and proceed toward consummation of
the acquisition of the Assets in accordance with the terms hereof, or (b)
terminate this Agreement. If the Buyer elects to so terminate this
Agreement, the Buyer and the Sellers will be discharged of any and all
obligations hereunder, except those under Section 6.5 and Article 9 hereof.
If the Buyer elects to consummate the Transaction contemplated by this
Agreement, there will be no separate adjustment in the Purchase Price
related to such loss or damage but all insurance proceeds payable as a
result of the occurrence of the event resulting in such loss or damage will
be delivered by the Sellers to the Buyer, or the rights to such proceeds
will be assigned by the Sellers to the Buyer and the Sellers will pay to the
Buyer (or the Buyer may withhold from the Purchase Price) an amount equal to
any deductible amount charged to the Sellers against the proceeds due for
such loss.
ARTICLE 7
COVENANTS RELATING TO EMPLOYMENT
AND EMPLOYEE MATTERS
____________________
7.1 OFFER OF EMPLOYMENT.
___________________
The Buyer shall make an offer of ongoing employment to such
persons selected by the Buyer on or before the Closing Date. Such offer
shall be for comparable employment and shall be effective as of the Closing
Date under substantially the same compensation arrangements including
benefits (but excluding pension plans) and with job duties located within a
reasonable commuting distance of the work location to which each person was
assigned prior to the Closing Date. Employees of the Sellers who accept
said offer and become employees of the Buyer are hereinafter referred to as
"Transferred Employees." Included among the Buyer's Employee Benefit Plans
shall be a "group health plan" as defined in Section 5000(b)(1) of the
Internal Revenue Code, which plan shall contain no exclusion or limitation
with respect to any preexisting condition of any Transferred Employee or
Transferred Employee's spouse or dependents provided that such Transferred
Employee has been enrolled in the Sellers' group health plan. For purposes
of the preceding sentence, the phrase "exclusion or limitation with respect
to any preexisting condition" shall have the same meaning as in Section
602(2)(D) of ERISA, except that an "exclusion or limitation with respect to
any preexisting condition" which is currently applicable to such Transferred
Employee or his or her spouse or dependents need not be considered by the
Buyer an "exclusion or limitation with respect to any preexisting condition"
for such purposes.
7.2 WAGE AND WITHHOLDING REPORTING OBLIGATIONS.
__________________________________________
<PAGE> 33 of 47
The Sellers and the Buyer agree that, pursuant to the
"Alternative Procedure" provided in Section 5 of Revenue Procedure 84-77,
1984-2 C.B. 753, with respect to filing and furnishing forms W-2, W-3, and
941, (a) the Sellers and the Buyer shall each report on a predecessor-
successor basis as set forth therein, (b) the Sellers shall be relieved from
furnishing Forms W-2 to the Transferred Employees, and (c) the Buyer shall
assume the obligations of the Sellers to furnish Forms W-2 to the
Transferred Employees (without regard to the actual length of employment
with the Buyer) for the full calendar year in which the Closing occurs. The
Sellers shall fully cooperate with the Buyer to allow it to fulfill its
obligations hereunder.
ARTICLE 8
CONDITIONS PRECEDENT
____________________
8.1 CONDITIONS PRECEDENT TO OBLIGATIONS OF PARTIES.
______________________________________________
The respective obligations of the Buyer, on the one hand,
and the Sellers, on the other, to consummate the Transaction to be
consummated at Closing are subject to the satisfaction, at or prior to the
Closing Date, of each of the following conditions:
8.1.1 No Injunction, Etc. No preliminary or
__________________
permanent injunction or other order shall have been issued by any federal or
state court of competent jurisdiction in the United States or by any United
States federal or state governmental or regulatory body nor any statute,
rule, regulation or executive order promulgated or enacted by any United
States federal or state governmental authority which restrains, enjoins or
otherwise prohibits the Transaction contemplated hereby and shall remain in
effect.
8.1.2 FCC and Other Approvals. The FCC, and if
_______________________
required, any PUC, shall have granted its consent and approval to the
assignment or transfer of the Licenses from Sellers to the Buyer. This
condition shall be deemed to be satisfied once all such consents and
approvals have become Final Orders.
8.1.3 Antitrust Improvements Act. Any waiting
__________________________
period under the Antitrust Improvements Act applicable to the consummation
of the Transaction contemplated hereby shall have expired.
8.1.4 No Proceeding or Litigation. No suit,
___________________________
action or proceeding before any court or any governmental or regulatory
authority shall have been commenced and be pending by any governmental or
regulatory authority, no investigation by any governmental or regulatory
authority shall have been commenced and be pending, against any of the
parties hereto or any of their affiliates, associates, officers or directors
seeking to restrain, prevent or change in any material respect the
Transaction contemplated hereby or seeking material damages in connection
with any such Transaction.
<PAGE> 34 of 47
8.2 CONDITIONS PRECEDENT TO OBLIGATIONS OF THE BUYER.
________________________________________________
In addition to the conditions set forth in Section 8.1, the
obligations of the Buyer to consummate the Transaction to be consummated at
the Closing are subject to the satisfaction, at or prior to the Closing
Date, of each of the additional conditions set forth below:
8.2.1 Accuracy of Representations and Warranties.
___________________________________________
The representations and warranties of the Sellers contained herein or any
certificate delivered pursuant to this Agreement shall be deemed made again
at Closing and shall be true in all material respects as though made on and
as of the Closing Date.
8.2.2 Performance of Agreements. Each of the
_________________________
Sellers shall have performed in all material respects, all obligations and
agreements, and complied in all material respects with all covenants and
conditions contained in this Agreement, to be performed or complied with by
it prior to or at the Closing Date.
8.2.3 Certificates. The Buyer shall have
____________
received a certificate from each Seller, dated the Closing Date, signed by
the President or any authorized Vice President of such Seller, to the effect
that, to the best of the knowledge, information and belief of such officer,
the conditions specified in Section 8.2.1 and Section 8.2.2 have been
satisfied.
8.2.4 Opinion of Counsel for the Sellers. The
__________________________________
Buyer shall have received an opinion of the Sellers' counsel and the
Sellers' FCC Counsel, in each case dated the Closing Date, addressed to the
Buyer and in each case in a form customary for transactions of the nature
contemplated by this Agreement.
8.2.5 Other Deliveries. The Sellers shall have
________________
delivered to the Buyer at the Closing the following:
(a) a certificate of incumbency for the
officers executing documents on behalf of the Sellers and certified copies
of the resolutions duly adopted by the directors of each of the Sellers, and
signed by the Secretary or Assistant Secretary, each authorizing the
Transaction contemplated by this Agreement;
(b) a certificate of the Secretary or
Assistant Secretary certifying the resolutions referred to in Section
8.2.5(a) have not been rescinded, modified, or withdrawn and that such
resolutions are in full force and effect as of the Closing Date;
(c) accurate and complete copies of all
Licenses listed on Schedule 5.1.4(b) and all Licenses acquired after the
date hereof and prior to the Closing;
<PAGE> 35 of 47
(d) evidence satisfactory to Buyer of
the release of any and all Liens not constituting Permitted Liens; and
(e) such further certificates and
documents evidencing consummation by the Sellers of the transactions
contemplated hereby as the Buyer shall reasonably request.
8.2.6 Consents and Filings. The Sellers shall
____________________
have made each of the notice filings described in clause (iii) (a) of
Section 5.1.3.
8.3 CONDITIONS PRECEDENT TO THE OBLIGATIONS OF THE
______________________________________________
SELLERS.
________
In addition to the conditions set forth in Section 8.1, the
obligations of the Sellers to consummate the Transaction to be consummated
at the Closing are subject to the satisfaction, at or prior to the Closing
Date, of each of the additional conditions set forth below.
8.3.1 Accuracy of Representations and Warranties.
__________________________________________
The representations and warranties of the Buyer contained herein shall be
deemed made again at Closing and shall be true at and as of the Closing
Date.
8.3.2 Performance of Agreements. The Buyer shall
_________________________
have performed in all material respects all obligations and agreements, and
complied in all material respects with all covenants and conditions,
contained in this Agreement, to be performed or complied with by it prior to
or at the Closing Date.
8.3.3 Payment of Purchase Price. The Sellers
_________________________
shall have received satisfactory evidence of payment of the Purchase Price
at Closing in accordance with Section 4.1.
8.3.4 Opinion of Counsel for the Buyer. The
________________________________
Sellers shall have received an opinion of the Buyer's Counsel, dated the
Closing Date, in a form customary for transactions of the nature
contemplated by this Agreement.
8.3.5 Other Deliveries. The Buyer shall have
________________
delivered to the Sellers at the Closing the following:
(a) a certificate of incumbency for the
officers executing the documents on behalf of the Buyer and certified copies
of the resolutions duly adopted by the directors of the Buyer, and signed by
the Secretary or Assistant Secretary, each authorizing the Transaction
contemplated by this Agreement;
<PAGE> 36 of 47
(b) a certificate of the Secretary or
Assistant Secretary certifying that the resolutions referred to in Section
8.3.5(a) have not been rescinded, modified or withdrawn and that such
resolutions are in full force and effect as of the Closing Date; and
(c) such further certificates and
documents evidencing the consummation by the Buyer of the transactions
contemplated hereby as the Sellers shall reasonably request.
8.3.6 Registration Rights Agreement. The Buyer
_____________________________
and the Sellers shall have entered into a Registration Rights Agreement
substantially in the form of Exhibit 8.4.5.
8.3.7 Stockholder Approval. This Agreement and
____________________
the Transaction shall have been approved by the stockholders of Parent in
accordance with New York law.
8.4 WAIVER OF CONDITIONS.
____________________
The Buyer, in its discretion, may waive, in whole or in
part, at or prior to the Closing Date, the failure of satisfaction of any of
the conditions precedent to its obligations set forth herein. The Sellers
may, in their discretion, waive, in whole or in part, at or prior to the
Closing Date, the failure of satisfaction of any of the conditions precedent
to its obligations set forth herein. No such waiver by the Buyer or the
Sellers shall be effective unless made in writing.
ARTICLE 9
TERMINATION AND DEFAULT
_______________________
9.1 GENERAL.
_______
This Agreement may be terminated and the Transaction
contemplated hereby may be abandoned at any time, but not later than the
Closing Date, as set forth below.
9.1.1 Mutual Consent. This Agreement may be
______________
terminated by the mutual consent of the Buyer and the Sellers.
9.1.2 Order or Decree. This Agreement may be
_______________
terminated by the Sellers or the Buyer, if any court of competent
jurisdiction in the United States or other United States governmental body
shall have issued an order, decree, ruling or taken any other action
restraining, enjoining or otherwise prohibiting the Transaction contemplated
hereby (including, but not limited to, FCC denial of the Assignment
Applications) and such order, decree, ruling or other action shall have
become final and nonappealable.
<PAGE> 37 of 47
9.1.3 Failure of Conditions.
______________________
(a) The Agreement may be terminated by
the Sellers upon five (5) days written notice to the Buyer, in the event
that any of the conditions precedent to the Sellers' obligations set forth
in Section 8.1 and Section 8.3 with respect to the Buyer are not satisfied
at or during the respective times therein indicated (other than by reason of
the material breach by such terminating party of any of its representations,
warranties, covenants, or agreements set forth herein) and such conditions
are not either (i) cured by the Buyer within five (5) days after the Sellers
give the Buyer such notice, or (ii) waived by the Sellers at or prior to the
Closing Date.
(b) This Agreement may be terminated by
the Buyer upon five (5) days written notice to the Sellers, in the event
that any of the conditions precedent to the Buyer's obligations set forth in
Section 8.1 and Section 8.2 with respect to the Sellers are not satisfied at
or during the respective times therein indicated (other than by reason of
the material breach by such terminating party of any of its representations,
warranties, covenants, or agreements set forth herein) and such conditions
are not either (i) cured by the Sellers within five (5) days after the Buyer
gives the Sellers such notice, or (ii) waived by the Buyer at or prior to
the Closing Date.
9.1.4 Casualty Loss. This Agreement may be
_____________
terminated by the Buyer as set forth in Section 6.10..
9.1.5 Pre-Closing Breach. This Agreement may be
__________________
terminated by the Buyer or Sellers as set forth in section 11.3(b)
9.1.6 Acquisition Proposal; Break-Up Fee.
___________________________________
(a) Parent may terminate this Agreement
upon five (5) days written notice to Buyer, if Parent receives an
Acquisition Proposal that is financially superior to the transactions
contemplated hereby and is reasonably capable of being financed (as
determined in each case in good faith by the Parent's board of directors
after consultation with the Parent's financial advisers). Prior to any such
termination however, Sellers agree to negotiate in good faith with Buyer to
make such adjustments in the terms and conditions of this Agreement so as to
enable Buyer to match or better the Acquisition Proposal.
(b) If Parent exercises its termination
rights under this Section 9.1.6, upon the closing of the transactions
contemplated by an Acquisition Proposal, Parent shall pay Buyer, out of the
resulting proceeds, a "break-up" fee of $4 million, plus $2 million for all
fees and expenses incurred by Buyer in connection with this Agreement in
cash by wire transfer. Such payment shall be made at the date of closing of
the Acquisition Proposal transactions. . If the transactions contemplated
by such Acquisition Proposal fail to close for any reason, Sellers shall,
within thirty (30) days of termination or abandonment of the Acquisition
Proposal transactions, enter into an agreement with Buyer to consummate a
<PAGE> 38 of 47
transaction on substantially the same terms as are contained in this
Agreement.
9.1.7 Outside Date. This Agreement may be
____________
terminated by either Sellers or Buyer if the Closing shall not have occurred
on or prior to February 1, 1997; provided, however, that no party may
exercise its rights under this Section 9.1.7 if such party is in material
breach or default under this Agreement.
9.2 PROCEDURE UPON TERMINATION.
__________________________
In the event of the termination and abandonment of this
Agreement, written notice thereof shall promptly be given to the other
parties hereto and this Agreement shall terminate, all further obligations
of the parties hereunder to satisfy the conditions precedent to the Closing
shall terminate, and the Transaction contemplated hereby shall be abandoned
without further action by any of the parties hereto except that Section 6.5
(Confidentiality) shall survive such termination or abandonment
9.3 EFFECT OF TERMINATION.
_____________________
Nothing in this Article 9 shall relieve any party hereto of
any liability for breach of this Agreement.
ARTICLE 10
POST-CLOSING TRANSACTIONS
_________________________
10.1 TRANSITION.
__________
The Sellers shall cooperate with the Buyer and agree to use
their best efforts to assist the Buyer in a smooth transition of the
ownership of the Assets on the Closing Date, including the preservation of
the continued services of the employees of the Sellers that the Buyer wishes
to retain and the preservation for the Buyer of the goodwill of the Sellers'
suppliers, customers and others having business relations with the Sellers.
10.2 ACCESS TO BOOKS AND RECORDS.
___________________________
After the Closing, the Sellers shall allow representatives
of the Buyer reasonable opportunity from time to time during normal business
hours to inspect and copy records which pertain to the operation of the
Sellers' Business prior to the Closing Date and which are not transferred to
the Buyer hereunder. After the Closing, the Buyer shall allow
representatives of the Sellers reasonable opportunity from time to time
during normal business hours to inspect and copy records which pertain to
the operation of the Sellers' Business prior to the Closing Date and which
are transferred to the Buyer hereunder.
<PAGE> 39 of 47
10.3 ASSIGNMENT AND FURTHER ASSURANCES.
__________________________________
To the extent that all real property interests, contractual
rights and other Assets used in the Sellers' Business are not effectually
transferred at Closing to the Buyer, the Sellers will take all reasonably
necessary action to effectuate such assignments. In the event the Sellers
are unable to obtain any consent to assignment or otherwise are not
reasonably able to effectuate such assignments (including, but not limited
to, the assignment of those contracts listed on Schedule 5.1.15), the
Sellers shall take reasonable action necessary to give the Buyer the
substantial benefit of such property interests, contractual rights, or other
Assets.
10.4 CONFIDENTIALITY OF CUSTOMER LISTS.
_________________________________
All documents and computer files containing the names and
addresses of the paging customers of the Sellers shall become Buyer's
property as of the Closing, and all copies thereof shall be turned over to
the Buyer, and shall not be retained or used in whole or part by the
Sellers, or any of their affiliates after the Closing.
ARTICLE 11
INDEMNIFICATION AND SURVIVAL
____________________________
11.1 INDEMNIFICATION BY THE SELLERS.
_______________________________
The Sellers shall, jointly and severally, indemnify and hold
harmless the Buyer from and against any and all claims, losses, damages,
liabilities and expenses (including, without limitation, settlement costs
and any legal, accounting and other expenses for investigating or defending
any actions or threatened actions), net of income tax benefits and insurance
proceeds, if any ("Damages"), incurred by the Buyer, in connection with each
and all of the following:
(a) Any breach of any representation or
warranty made by Sellers in this Agreement (unless waived in writing by the
Buyer prior to the Closing);
(b) The breach of any covenant, agreement or
obligation of the Sellers contained in this Agreement or any other
certificate or document delivered pursuant to this Agreement (unless waived
in writing by the Buyer prior to the Closing);
(c) Claims arising out of the operation of the
Sellers' Business before Closing;
(d) Costs and damages arising out of that those
pending tax assessments/audits described on Schedule 5.1.6 and that
litigation described on Schedule 5.1.7;
(e) The failure of the Sellers to obtain the
protection afforded by compliance with the notification requirements of the
Bulk Sales Laws in force in the jurisdictions in which such laws may be
<PAGE> 40 of 47
applicable to the Sellers or the Transaction contemplated by this Agreement.
The Sellers covenant and agree to pay and discharge, in due course, all
claims of creditors which may be asserted against the Buyer by reason of
such noncompliance, to the extent, and in the respective dollar amounts, if
any, that such liabilities or obligations are not assumed by the Buyer under
this Agreement; and the Sellers shall indemnify the Buyer against and hold
it harmless with respect to any losses suffered by the Buyer by reason of
the failure of the Sellers to pay or discharge such claims;
(f) Costs (including reasonable attorneys'
fees), damages, liabilities, fines and penalties arising out of any
noncompliance by the Sellers with the terms and conditions of Licenses
issued by the FCC, including such noncompliance as is set forth on
Schedule 5.1.4(a); and
(g) any Excluded Liability.
Notwithstanding the foregoing, the Buyer shall not be
entitled to indemnification hereunder until such time as the amount of
Damages incurred by the Buyer exceeds $50,000, at which time the Buyer shall
be entitled to indemnification for all Damages in excess of $50,000,
provided however that the foregoing shall not apply to determination of, or
adjustments to, the Purchase Price set forth in Article 4 or to the Sellers'
indemnification obligations set forth in Section 11.1(d) .
11.2 INDEMNIFICATION BY THE BUYER.
____________________________
The Buyer shall indemnify and hold harmless the Sellers from
and against any and all Damages incurred by the Sellers, in connection with
each and all of the following:
(a) Any breach of any representation or
warranty made by the Buyer in this Agreement (unless waived in writing by
the Sellers prior to the Closing);
(b) The breach of any covenant, agreement or
obligation of the Buyer contained in this Agreement or any other instrument
contemplated by this Agreement (unless waived in writing by the Sellers
prior to the Closing);
(c) any claim arising out of the operation of
the Assets after Closing; and
(d) any Assumed Liabilities.
11.3 CLAIMS FOR INDEMNIFICATION.
__________________________
(a) If prior to the Closing Date the Buyer
obtains actual knowledge of the breach of any representation, warranty or
covenant made by the Sellers in this Agreement, which breach shall, in
Buyer's good faith estimation, cost less than $500,000 to cure, then the
Buyer shall promptly notify the Sellers thereof in writing. If such breach
is capable of being cured, the Sellers shall attempt to cure the same at
Sellers' sole cost and expense. If the Sellers are unable to cure the same
after reasonable and diligent efforts, or if the same is not capable of
<PAGE> 41 of 47
being cured, Buyer shall consummate the Agreement, and be entitled to seek
indemnification for any Damages suffered pursuant to Section 11.1 hereof.
(b) If prior to the Closing Date the Buyer
obtains actual knowledge of the breach of any representation, warranty or
covenant made by the Sellers in this Agreement, which breach shall, in
Buyer's good faith estimation, cost $500,000 or more to cure, then the Buyer
shall promptly notify the Sellers thereof in writing. If such breach is
capable of being cured, the Sellers, in their sole discretion, may attempt
to cure the same at Sellers' sole cost and expense. If the Sellers are
unable or unwilling to cure the same, or if the same is not capable of being
cured, Sellers or Buyer (if such party is not in material breach or default
under this Agreement) may elect to terminate this Agreement upon five (5)
days written notice. Buyer shall in either instance retain all its remedies
for such breach. If neither Buyer nor Sellers elect to terminate the
Agreement notwithstanding such breach, Buyer shall be entitled to seek
indemnification for any Damages suffered as a result of such breach, except
as set forth in Section 6.10..
(c) In no event shall Sellers' liability for
indemnification exceed the Purchase Price.
(d) Whenever any claim shall arise for
indemnification hereunder, the party entitled to indemnification (the
"indemnified party") shall promptly notify the other party (the
"indemnifying party") of the claim and, when known, the facts constituting
the basis for such claim. In the event of any claim for indemnification
hereunder resulting from or in connection with any claim or legal
proceedings by a third party, the notice to the indemnifying party shall
specify, if known, the amount of the liability arising therefrom. The
indemnified party shall not settle or compromise any claim by a third party
for which it is entitled to indemnification hereunder, without the prior
written consent of the indemnifying party (which shall not be unreasonably
withheld) unless suit shall have been entered against it and the
indemnifying party shall not have taken control of such suit after
notification thereof as provided in this Section 11.3.
11.4 DEFENSE BY INDEMNIFYING PARTY.
_____________________________
In connection with any claim giving rise to a right of
indemnification hereunder resulting from or arising out of any claim or
legal proceeding by a person who is not a party to this Agreement, the
indemnifying party at its sole cost and expense may, upon written notice to
the indemnified party assume the defense of any such claim or legal
proceeding if it acknowledges to the indemnified party in writing its
obligations to indemnify the indemnified party with respect to all elements
of such claim. The indemnified party shall be entitled to participate in
(but not control) the defense of any such action, with its counsel and at
its own expense. If the indemnifying party does not assume the defense of
any such claim or litigation resulting therefrom, (a) the indemnified party
may defend against such claim or litigation, in such manner as it may deem
appropriate, including, but not limited to, settling such claim or
litigation, after giving notice of the same to the indemnifying party, on
such terms as the indemnified party may deem appropriate, and (b) the
indemnifying party shall be entitled to participate in (but not control) the
defense of such action, with its counsel and at its own expense. If the
<PAGE> 42 of 47
indemnifying party thereafter seeks to question the manner in which the
indemnified party defended such third party claim or the amount or nature of
any such settlement, the indemnifying party shall have the burden to prove
by a preponderance of the evidence that the indemnified party did not defend
or settle such third party claim in a reasonably prudent manner.
11.5 MANNER OF INDEMNIFICATION.
_________________________
Subject to Section 11.4 above, the obligations of the
indemnifying party hereunder shall be effected by payment of cash or
delivery of a certified or cashier's check in the amount of the
indemnification liability. If the Buyer is the indemnified party under this
Article 11, the Buyer shall recover the amount of its Damages from the
escrowed funds in accordance with the terms of the Escrow Agreement before
seeking any recovery from the Sellers, and the Buyer and the Sellers shall
promptly execute and deliver to the Escrow Agent written instructions
directing the Escrow Agent to disburse to the Buyer a portion of the
escrowed funds in the amount of the Buyer's Damages.
11.6 SURVIVAL OF REPRESENTATIONS AND WARRANTIES.
___________________________________________
All covenants and obligations to be performed after the
Closing Date contained in this Agreement or in any other certificate or
document delivered pursuant to this Agreement shall survive the Closing.
All representations and warranties contained in this Agreement or in any
other certificate or document delivered pursuant to this Agreement shall
survive the Closing for a period of eighteen (18) months. The waiver of any
condition, other than as provided by Section 8.4, based upon the accuracy of
any representation or warranty, or on the performance of or compliance with
any covenant or obligation, will not affect the right to indemnification,
reimbursement, or other remedy based upon such representations, warranties,
covenants or obligations.
ARTICLE 12
MISCELLANEOUS
_____________
12.1 BROKERS.
_______
Except as disclosed on Schedule 12.1, the Transaction has
been and shall be carried on by the Buyer directly with the Sellers and in
such manner as not to give rise to any valid claims against the Sellers or
the Buyer for a brokerage commission, finder's fee or other like payment and
each party agrees to indemnify and hold the other harmless from and against
any claims for brokerage commissions or finder's fees insofar as such claims
shall be alleged to be based upon arrangements or agreements made by the
indemnifying party or in its behalf. Such indemnity shall include the cost
of reasonable counsel fees in connection with the defense of any such
claims.
12.2 NOTICES.
_______
<PAGE> 43 of 47
Except as otherwise provided, all notices which are
permitted or required under this Agreement shall be in writing and shall be
deemed given when delivered personally, by fax, telex or telegram, or if
sent by mail, five (5) business days after being mailed by registered or
certified mail, postage prepaid, or by such other method (including air
courier) which provides for a signed receipt upon delivery, addressed as
follows, or to such other person or address as may be designated by notice
to the other party:
If to the Buyer, to:
Metrocall, Inc.
6677 Richmond Highway
Alexandria, Virginia 22306
Attn: Vincent D. Kelly
Chief Financial Officer and Treasurer
Fax Number: (703) 768-9625
with a copy (which shall not constitute notice) to:
Wilmer, Cutler & Pickering,
100 Light Street
Baltimore, Maryland 21201
Attn: George P. Stamas or John B. Watkins
Fax Number: (410) 986-2828
or if to the Sellers, to:
Bariston Associates, Inc.
One International Place
Boston, Massachusetts 02110
Attn: David A. Barry
Fax Number: (617) 330-8951
with a copy (which shall not constitute notice) to:
Stroock & Stroock & Lavan
Seven Hanover Square
New York, New York 10004
Attn: Martin H. Neidell
Fax Number: 212-806-6006
12.3 EXPENSES OF TRANSFER.
____________________
Buyer and Sellers shall share equally all transfer,
documentary, recordation, sales or other taxes or fees assessed or levied in
connection with the sale of the Assets, regardless of whether Sellers or
Buyer is obligated for collection and remittance of the Transaction Taxes.
The Sellers shall cooperate with the Buyer in the filing for any such
available exemptions. The Sellers and the Buyer shall share equally the
filing fees, if any, required by the FCC or any PUC. The Buyer shall pay
the filing fee relating to any filing required in accordance with the
Antitrust Improvements Act. All other expenses incurred in connection with
the negotiation, preparation, execution, and performance of this Agreement
shall be paid by the party incurring such expenses.
<PAGE> 44 of 47
12.4 ASSIGNMENT.
__________
This Agreement and the Transaction contemplated herein may
not be assigned or otherwise transferred, in whole or in part, by operation
of law or otherwise without the prior written consent of the other party;
provided however that the Buyer may assign any or all of its rights to
purchase the Assets under this Agreement to a subsidiary of the Buyer but
such assignment shall not release, affect or reduce in any way the Buyer's
obligations to the Sellers hereunder.
12.5 COUNTERPARTS.
____________
This Agreement may be executed in two or more counterparts,
each of which when so executed and delivered, shall be an original
instrument, but such counterparts together shall constitute a single
agreement.
12.6 ENTIRE AGREEMENT.
________________
This Agreement, including all schedules and exhibits hereto,
and all certificates and documents executed and delivered in connection with
this Agreement, when executed and delivered, constitute the entire agreement
of the parties, superseding and extinguishing all prior agreements and
understandings, representations and warranties, relating to the subject
matter hereof, except for the Confidentiality Agreement dated January 5,
1996 between the Buyer and Daniels & Associates L.P., on behalf of the
Sellers, which shall remain in full force and effect (the "Confidentiality
Agreement"). To the extent that any of the terms of the Confidentiality
Agreement conflict with this Agreement, the terms of this Agreement shall
supersede and control.
12.7 GOVERNING LAW.
_____________
This Agreement and the rights and obligations of the parties
hereunder shall be governed by the substantive laws of the State of Delaware
applicable to contracts made and to be performed therein, without reference
to the principles of conflicts of laws.
12.8 HEADINGS.
________
The section and other headings contained in this Agreement
are for reference purposes only and shall not affect the meaning or
interpretation of this Agreement.
12.9 SEVERABILITY.
____________
Any provision of this Agreement which is invalid or
unenforceable shall be ineffective to the extent of such invalidity or
unenforceability, provided that such invalidity or unenforceability does not
deny any party the material benefits of the transaction for which it has
<PAGE> 45 of 47
bargained, such invalidity or unenforceability shall not affect in any way
the remaining provisions hereof.
12.10 MODIFICATION AND AMENDMENT.
__________________________
This Agreement may not be modified or amended except by
written agreement specifically referring to this Agreement and signed by the
parties hereto.
12.11 WAIVER.
______
No waiver of a breach or default hereunder shall be
considered valid unless in writing and signed by the party giving such
waiver, and no such waiver shall be deemed a waiver of any subsequent breach
or default of the same or similar nature.
12.12 PARTIES OBLIGATED AND BENEFITED.
_______________________________
Subject to the limitations set forth below, this Agreement
will be binding upon the parties hereto and their respective assignees and
successors in interest and will inure solely to the benefit of such parties
and their respective assigns and successors in interest, and no other person
will be entitled to any of the benefits conferred by this Agreement.
12.13 ATTORNEYS' FEES.
_______________
In the event of any action or suit based upon or arising out
of any alleged breach by any party of any representation, warranty,
covenant, or agreement contained in this Agreement, the prevailing party
will be entitled to recover reasonable attorneys' fees and other costs of
such action or suit from the other party.
12.14 RIGHTS TO SPECIFIC PERFORMANCE.
______________________________
The Sellers acknowledge that the unique nature of the Assets
to be purchased by the Buyer pursuant to this Agreement renders money
damages an inadequate remedy for the breach by the Sellers of their
obligations under this Agreement, and the Sellers agree that in the event of
such breach, the Buyer will upon proper action instituted by it, be entitled
to a decree of specific performance of this Agreement in lieu of any
monetary damages for such breach.
12.15 ACTIONS.
_______
The parties will execute and deliver to the other, from time
to time at or after the Closing, for no additional consideration and at no
additional cost to the requesting party, such further assignments,
certificates, instruments, records, or other documents, assurances or things
as may be reasonably necessary to give full effect to this Agreement and to
allow each party fully to enjoy and exercise the rights accorded and
acquired by it under this Agreement.
<PAGE> 46 of 47
12.16 TERMS.
_____
Terms used with initial capital letters will have the
meanings specified, applicable to both singular and plural forms, for all
purposes of this Agreement. The word "include" and derivatives of that word
are used in this Agreement in an illustrative sense rather than limiting
sense.
12.17 CONSTRUCTION.
____________
This Agreement has been negotiated by the parties and their
respective legal counsel, and legal or equitable principles that might
require the construction of this Agreement or any provision of this
Agreement against the party drafting will not apply in any construction or
interpretation of this Agreement.
IN WITNESS WHEREOF, EACH OF THE BUYER, THE PARENT, AND THE
Sellers has caused this Agreement to be executed under seal individually or
by its duly authorized representatives, officers or agents on the date first
written above.
WITNESS: METROCALL, INC., a Delaware corporation,
Buyer
______________________________ By: ________________________________(SEAL)
Its: ________________________________
PAGE AMERICA GROUP, INC., a New York
corporation
______________________________ By: ________________________________(SEAL)
Its: ________________________________
PAGE AMERICA OF NEW YORK, INC., a New York
corporation
______________________________ By: ________________________________(SEAL)
Its: ________________________________
PAGE AMERICA OF ILLINOIS, INC., an
Illinois corporation
______________________________ By: ________________________________(SEAL)
Its: ________________________________
<PAGE> 47 of 47
PAGE AMERICA COMMUNICATIONS OF INDIANA,
INC., an Indiana corporation
______________________________ By: ________________________________(SEAL)
Its: ________________________________
PAGE AMERICA OF PENNSYLVANIA, INC., a
Pennsylvania corporation
______________________________ By: ________________________________(SEAL)
Its: ________________________________
