UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. )*
Nationwide Cellular Service, Inc.
-----------------------------
(Name of Issuer)
Common Stock, par value $.01 per share
-----------------------------
(Title of Class of Securities)
638595108
-----------------------------
(CUSIP Number)
John R. Worthington, General Counsel,
MCI Communications Corporation, 1801 Pennsylvania Avenue, N.W.,
Washington, D.C. 20006 (202) 872-1600
----------------------------------------------------------
(Name, Address and Telephone Number of Person Authorized to
Receive Notices and Communications)
May 22, 1995
-----------------------------
(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 if 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.
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).
Page 1 of 131 Pages
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SCHEDULE 13D
CUSIP No. 638595108 Page 2 of 131 Pages
- -----------------------------------------------------------------
1. NAME OF REPORTING PERSON
S.S. OR IDENTIFICATION NO. OF ABOVE PERSON
MCI COMMUNICATIONS CORPORATION 52-0886267
- -----------------------------------------------------------------
2. CHECK THE APPROPRIATE BOX IF A MEMBER (a) [ ]
OF A GROUP* (b) [ ]
- -----------------------------------------------------------------
3. SEC USE ONLY
- -----------------------------------------------------------------
4. SOURCE OF FUNDS*
00(see item 3)
- -----------------------------------------------------------------
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDING IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(E)
- -----------------------------------------------------------------
6. CITIZENSHIP OR PLACE OF ORGANIZATION: Delaware
- -----------------------------------------------------------------
7. SOLE VOTING POWER
NUMBER OF 1,982,064**
SHARES ----------------------------------------------------
BENEFICIALLY 8. SHARED VOTING POWER
OWNED BY NONE. -O-
EACH ----------------------------------------------------
REPORTING 9. SOLE DISPOSITIVE POWER
PERSON -O-
WITH ----------------------------------------------------
10. SHARED DISPOSITIVE POWER
NONE. -O-
- -----------------------------------------------------------------
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON
1,982,064**
- -----------------------------------------------------------------
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES*
- -----------------------------------------------------------------
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
25%
- -----------------------------------------------------------------
14. TYPE OF REPORTING PERSON*
CO
- -----------------------------------------------------------------
*SEE INSTRUCTIONS BEFORE FILLING OUT! INCLUDE BOTH SIDES OF THE
COVER PAGE, RESPONSES TO ITEMS 1-7 (INCLUDING EXHIBITS) OF THE
SCHEDULE AND THE SIGNATURE ATTESTATION.
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CUSIP No. 638595108 Page 3 of 131 Pages
** Neither the filing of this Schedule 13D nor any of its
contents shall be deemed to constitute an admission that MCI
is the beneficial owner of any of the Issuer Common Stock
referred to herein for purposes of Section 13(d) of the
Securities Exchange Act of 1934, as amended, or for any other
purpose, and such beneficial ownership is expressly
disclaimed.
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CUSIP No. 638595108 Page 4 of 131 Pages
1. Security and Issuer.
This Statement on Schedule 13D (this "Schedule 13D")
relates to shares of common stock, $.01 par value per share, of
Nationwide Cellular Service, Inc. ("Issuer Common Stock"), a
Delaware corporation (the "Issuer"). The principal executive
offices of the Issuer are located at 20 East Sunrise Highway,
Valley Stream, New York 11581-1252.
Item 2. Identity and Background.
(a)-(c), (f). This Schedule 13D is being filed on behalf of
MCI Communications Corporation, a Delaware corporation ("MCI").
Neither the filing of this Schedule 13D nor the information
contained herein shall be deemed to constitute an affirmation by
MCI that it is the beneficial owner of the Issuer Common
Stockreferred to herein for purposes of Section 13(d) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act") or
for any other purpose, and such beneficial ownership is expressly
disclaimed.
MCI and its subsidiaries are principally engaged in the
provision of domestic and international voice and data
communications services. MCI's principal executive offices are
located at 1801 Pennsylvania Avenue, N.W., Washington, D.C. 20006.
The name, citizenship, residence or business address and
principal occupation or employment (and the name, principal
business and address of any corporation or other organization in
which such employment is conducted) of each director and executive
officer of MCI is set forth in Schedule A hereto.
(d), (e). Neither MCI nor, to the best of MCI's knowledge,
any of the directors or executive officers of MCI has, during the
past five years: (i) been convicted in a criminal proceeding
(excluding traffic violations or similar misdemeanors); or (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. As
more fully described in Item 4 hereof, MCI and the persons set
forth on Schedule B hereof (the "Stockholders"), each of whom is a
record and/or beneficial owner of Issuer Common Stock, have entered
into Voting Agreements described in Item 4. The Stockholders
entered into their respective Voting Agreements to induce MCI and
NTS Acquisition Corp., a Delaware corporation and an indirect,
wholly-owned subsidiary of MCI ("Sub"), to enter into the Merger
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CUSIP No. 638595108 Page 5 of 131 Pages
Agreement described in Item 4.
Item 4. Purpose of Transaction.
On May 22, 1995, MCI, Sub and the Issuer entered into an
Agreement and Plan of Merger (the "Merger Agreement") providing for
the merger (the "Merger") of Sub with and into the Issuer,
whereupon the separate existence of Sub will cease and the Issuer
will continue as the surviving corporation.
At the effective time of the Merger (the "Effective
Time"), each share of Issuer Common Stock issued and outstanding
immediately prior to the Effective Time (other than (i) shares of
Issuer Common Stock owned by the Issuer or by any subsidiary of the
Issuer, and shares of Issuer Common Stock owned by MCI, Sub or any
other subsidiary of MCI and (ii) shares of Issuer Common Stock
subject to dissenters' rights) will be converted into the right to
receive $18.50 in cash, payable to the holder thereof, without
interest.
Because approval of the Issuer's stockholders is required
by applicable law in order to consummate the Merger, the Issuer
will submit the Merger to its stockholders for approval. If
consummated, the Merger will result in MCI beneficially owning all
of the outstanding shares of Issuer Common Stock. MCI intends to
vote any shares of Issuer Common Stock over which it has voting
power in favor of the Merger and in favor of any other transactions
contemplated by the Merger Agreement.
The obligations of the parties to the Merger Agreement to
effect the Merger are subject to certain conditions, including the
due authorization and approval by the Board of Directors of MCI of
the Merger, and, prior to the Effective Time, MCI or the Issuer may
terminate the Merger Agreement under certain circumstances, in each
case as set forth in the Merger Agreement.
Concurrently with and as a condition to the execution and
delivery of the Merger Agreement, MCI and the Stockholders entered
into certain Voting Agreements, each dated as of May 22, 1995 (the
"Voting Agreements") relating to (i) an aggregate of 1,982,064
outstanding shares of Issuer Common Stock owned beneficially and of
record by the Stockholders as of the date of the Voting Agreements,
and (ii) any shares of Issuer Common Stock acquired by the
Stockholders after such date, whether upon the exercise of options,
conversion of convertible securities or otherwise. If the Merger
Agreement is terminated in accordance with its terms, the covenants
and agreements contained in the Voting Agreements with respect to
shares of Issuer Common Stock will also terminate at such time.
Subject to the foregoing and to certain exceptions and conditions,
the Stockholders have agreed pursuant to the Voting Agreements to
vote, and have appointed MCI, certain of its executive officers and
any other of its designees as their proxy to vote, the shares of
Issuer Common Stock held by them (representing in the aggregate
1,982,064 shares of Issuer Common Stock, based on information,
dated as of April 15, 1995, set forth in the Issuer's Proxy
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CUSIP No. 638595108 Page 6 of 131 Pages
Statement (the "Proxy Statement") furnished in connection with the
annual meeting of stockholders of the Issuer to be held on June 1,
1995) and the shares of Issuer Common Stock acquired by them after
the date of the Voting Agreements in favor of the Merger, the
execution and delivery by the Issuer of the Merger Agreement and
the approval of the terms thereof and of certain related agreements
and actions and against certain other enumerated actions or
agreements (together with the Merger, the "Merger Related
Matters"). Subject to the foregoing and to certain exceptions and
conditions, each of the Stockholders (in his capacity as a
stockholder only if he is also a director of the Issuer) has agreed
(i) to refrain from soliciting, encouraging or taking any other
action to facilitate any inquiries or the making of any proposal
regarding the Issuer, (ii) to restrictions upon the transfer of his
shares of Issuer Common Stock, (iii) to refrain from granting any
proxies or powers of attorney, depositing any shares of Issuer
Common Stock in any voting trust or entering into any agreement
with respect to voting thereof and (iv) to take or refrain from
taking certain other actions. Mr. Merv Adelson has additionally
agreed, in the Voting Agreement with respect to the shares of
Issuer Common Stock owned by him, promptly to terminate all
provisions of the Securities Purchase and Stockholder
Agreement,dated January 11, 1990, as amended by letter agreement
dated January 6, 1995, between the Issuer and Mr. Adelson, such
termination to be effective upon the Effective Time. Mr. Adelson
has also agreed that prior to the Effective Time he will not
exercise any registration rights or any rights to require the
Issuer to repurchase his warrant to purchase up to 850,000 shares
of Issuer Common Stock at an exercise price of $11.00 per share.
The Merger Agreement provides that, if the Merger is
approved by the stockholders of the Issuer and the other conditions
set forth in the Merger Agreement have been satisfied, the Issuer
will, immediately prior to the Effective Time, make a distribution
(the "Spin-Off Distribution") of the shares of the common stock,
par value $.001 per share, of Cellular Technical Services Company,
Inc. ("CTS Common Stock") then held by the Issuer to the holders of
record of Issuer Common Stock at the close of business on the date
(the "Spin-Off Distribution Record Date") immediately preceding
such date of distribution. The Spin-Off Distribution will be in an
amount per share of Issuer Common Stock as follows: (i) if the
average closing market price of CTS Common Stock on each of the
three trading-days ending on the Spin-Off Distribution Record Date
(the "Distribution Price") is equal to or less than $22.00 per
share, then each share of Issuer Common Stock shall be entitled to
receive that number of shares of CTS Common Stock equal to the
quotient obtained by dividing 3,980,000 by the sum of the then
outstanding shares of Issuer Common Stock and the shares of Issuer
Common Stock then reserved for issuance upon exercise of
outstanding options and warrants to purchase shares of Issuer
Common Stock, and (ii) if the Distribution Price per share is more
than $22.00 per share, then each share of Issuer Common Stock shall
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CUSIP No. 638595108 Page 7 of 131 Pages
be entitled to receive that number of shares of CTS Common Stock
equal to the quotient obtained by dividing (A) (x) the number of
shares which, based on the Distribution Price, have an aggregate
value equal to the product of $22.00 times 3,980,000, plus (y) the
number of shares which, based on the Distribution Price, have an
aggregate value equal to the product of 60% of the difference
between the Distribution Price and $22.00 times 3,980,000 by (B)
the sum of the then outstanding shares of Issuer Common Stock and
the shares of Issuer Common Stock then reserved for issuance upon
exercise of outstanding options and warrants to purchase shares of
Issuer Common Stock. In no event will the Issuer deliver any
fractional shares in the Spin-Off Distribution. In lieu of such
fractional shares, the Issuer will deliver cash to each holder of
Issuer Common Stock who would otherwise be entitled to a fractional
share in an amount equal to such fraction times the average closing
market price of CTS Common Stock on each of the three trading-days
ending on the Spin-Off Distribution Record Date, rounded to the
nearest $0.01.
If the Merger is completed as planned, (i) the board of
directors of the Issuer will consist of the directors of Sub
immediately prior to the Effective Time, until their successors are
duly elected or appointed, and (ii) the officers of the Issuer
immediately prior to the Effective Time will be the initial
officers of the Issuer until their successors are duly elected or
appointed.
At the Effective Time, (i) the certificate of
incorporation of the Issuer, as in effect immediately prior to the
Effective Time, shall be amended such that, at the Effective Time,
the certificate of incorporation of the Issuer will consist of the
provisions set forth in the certificate of incorporation of Sub, as
in effect immediately prior to the Effective Time (except that such
certificate shall provide that the name of the surviving
corporation of the Merger shall be "Nationwide Cellular Service,
Inc."), and (ii) the by-laws of Sub as in effect at the Effective
Time shall be the by-laws of the Issuer. The authorized capital
stock of Sub consists of 1,000 shares of common stock, par value of
$.10 per share, all 1,000 shares of which are owned by MCI
Telecommunications Corporation, a wholly-owned subsidiary of MCI.
If the Merger is completed as planned, MCI expects to
cause the Issuer to seek to have the shares of Issuer Common Stock
deregistered under the Exchange Act and to cease to be authorized
to be listed on the NASDAQ National Market System.
The preceding summary of certain provisions of the Merger
Agreement and the Voting Agreements is not intended to be complete
and is qualified in its entirety by reference to the full text of
such agreements, copies of which are filed as Exhibits 1 through 8
hereto, and which are incorporated herein by reference.
Other than as described above, MCI has no plans or
proposals that relate to or would result in any of the actions
described in subparagraphs (a) through (j) of Item 4 of Schedule
13D (although subject to the provisions of the Merger Agreement MCI
<PAGE>
CUSIP No. 638595108 Page 8 of 131 Pages
reserves the right to develop such plans).
Item 5. Interest in Securities of the Issuer.(a) and (b) As of
May 22, 1995, under the definition of "beneficial ownership" as set
forth in Rule 13d-3 under the Exchange Act, MCI may be deemed to
have beneficially owned 1,982,064 shares of Issuer Common Stock
presently outstanding and subject to the Voting Agreements,
constituting in the aggregate approximately 25% of the outstanding
shares of Issuer Common Stock (based on the number of shares of
Issuer Common Stock represented by the Issuer in the Merger
Agreement to be outstanding as of May 19, 1995). According to
information set forth in the Proxy Statement, as of April 15, 1995,
the Stockholders own options and/or warrants to purchase, in the
aggregate, an additional 1,381,000 shares of Issuer Common Stock.
Pursuant to the Voting Agreements, if any Stockholder acquires
additional shares of Issuer Common Stock, whether upon the exercise
of options or warrants,conversion of convertible securities or
otherwise, such shares will be subject to the terms and provisions
of the respective Voting Agreements, will be subject to the proxy
to vote such shares as indicated in the respective Voting
Agreements and, accordingly, under the definition of "beneficial
ownership" as set forth in Rule 13d-3 under the Exchange Act, may
be deemed to be beneficially owned by MCI. If the Stockholders
were to exercise all options and warrants held by them, MCI could
be deemed to beneficially own 3,363,064 shares of Issuer Common
Stock, constituting in the aggregate approximately 36% of the then
outstanding shares of Issuer Common Stock (based upon the number of
shares of Issuer Common Stock represented by the Issuer in the
Merger Agreement to be outstanding as of May 19, 1995, plus the
1,381,000 shares issued upon the exercise of the options and
warrants).
With respect to the Merger Related Matters, MCI has sole
power to vote the 1,982,064 shares of Issuer Common Stock subject
to the Voting Agreements. Unless and until the Merger is
consummated in accordance with the terms and conditions of the
Merger Agreement, and except as set forth above, neither MCI nor
its designees, if any, has any power to vote or to direct the vote,
shared power to vote or to direct the vote, sole or shared power to
dispose or to direct the disposition of any Issuer Common Stock.
Neither the filing of this Schedule 13D nor any of its contents
shall be deemed to constitute an admission that MCI is the
beneficial owner of the Issuer Common Stock referred to in this
paragraph for purposes of Section 13(d) of the Exchange Act or for
any other purpose, and such beneficial ownership is expressly
disclaimed.
(c) Except as set forth in this Item 5, to the best knowledge
of MCI, MCI has not, and no directors or executive officers of MCI
and no other person described in Item 2 hereof has beneficial
ownership of, or has engaged in any transaction during the past 60
days in, any shares of Issuer Common Stock.
(d) Neither MCI nor any of its designees has any right to
<PAGE>
CUSIP No. 638595108 Page 9 of 131 Pages
receive or the power to direct the receipt of dividends from, or
the proceeds from the sale of, the shares of Issuer Common Stock
which are subject to the Voting Agreements.
(e) Not applicable.
Item 6. Contracts, Arrangements, Understandings or Relationships
With Respect to Securities of the Issuer.
Except as set forth in this Schedule 13D, to the best
knowledge of MCI, there are no other contracts, arrangements,
understandings or relationships (legal or otherwise) among the
persons named in Item 2 and between such persons and any person
with respect to any securities of the Issuer, including but not
limited to, transfer or voting of any of the securities of the
Issuer, joint ventures, loan or option arrangements, puts or calls,
guarantees of profits, division of profits or loss, or the giving
or withholding of proxies, or a pledge or contingency the
occurrence of which would give another person voting power or
investment power over the securities of the Issuer.
<PAGE>
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CUSIP No. 638595108 Page 10 of 131 Pages
Item 7. Material to be Filed as Exhibits.
1 Agreement and Plan of Merger, dated May 22, 1995, among
MCI Communications Corporation, NTS Acquisition Corp.and
Nationwide Cellular Service, Inc.
2. Voting Agreement, dated as of May 22, 1995, among MCI
Communications Corporation, NTS Acquisition Corp. and
Merv Adelson.
3. Voting Agreement, dated as of May 22, 1995, among MCI
Communications Corporation, NTS Acquisition Corp. and
Stephen Katz.
4. Voting Agreement, dated as of May 22, 1995, among MCI
Communications Corporation, NTS Acquisition Corp. and
Jay Bernstein.
5. Voting Agreement, dated as of May 22, 1995, among MCI
Communications Corporation, NTS Acquisition Corp. and
Mel Steinberg.
6. Voting Agreement, dated as of May 22, 1995, among MCI
Communications Corporation, NTS Acquisition Corp. and
Larry Altman.
7. Voting Agreement, dated as of May 22, 1995, among MCI
Communications Corporation, NTS Acquisition Corp. and
Jerome Sanders.
8. Voting Agreement, dated as of May 22, 1995, among MCI
Communications Corporation, NTS Acquisition Corp. and
Joseph A. Gregori.
<PAGE>
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CUSIP No. 638595108 Page 11 of 131 Pages
SIGNATURE
After reasonable inquiry and to the best of my knowledge
and belief, I certify that the information set forth in this
Schedule 13D is true, complete and correct.
MCI COMMUNICATIONS CORPORATION
By:
/s/ Douglas L. Maine
---------------------
Name: Douglas L. Maine
Title: Executive Vice President and
Chief Financial Officer
DATED: June 1, 1995
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CUSIP No. 638595108 Page 12 of 131 Pages
SCHEDULE A
Board of Directors and Executive Officers of
MCI Communications Corporation
The directors and executive officers of MCI
Communications Corporation are identified in the table below.
Directors of MCI Communications Corporation are indicated by an
asterisk.
Name
Business Address
Citizenship
Principal Occupation
1. Bert C. Roberts, Jr.(*)
MCI Communications Corporation
1801 Pennsylvania Avenue, N.W.
Washington, D.C. 20006
United States
Chairman and Chief Executive
Officer, MCI Communications Corporation
2. Clifford L. Alexander, Jr.(*)
Alexander & Associates, Inc.
400 C. Street, N.E.
Washington, D.C. 20002
United States
President, Alexander & Associates,Inc.
3. Judith C. Areen(*)
Georgetown University Law Center
600 New Jersey Avenue, N.W.
Washington, D.C. 20001
United States
Executive Vice President of Law
Center Affairs and Dean of the Law Center,
Georgetown University
4. Michael H. Bader(*)
Haley, Bader & Potts
4350 N. Fairfax Drive
Arlington, VA 22203-1633
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CUSIP No. 638595108 Page 13 of 131 Pages
United States
Partner, Haley, Bader & Potts
5. Michael Hepher(*)
British Telecommunications plc.
81 Newgate Street
London, United Kingdom EC1A 7AJ
United Kingdom/Canada
Director and Group Managing
Director, British Telecommunications plc
6. Richard M. Jones(*)
Savings and Profit Sharing Fund
Sears Tower
Chicago, IL 60684
United States
Former Chairman and Chief Executive Officer,
Guaranty Federal Savings Bank
7. Gordon S. Macklin(*)
MCI Communications Corporation
1801 Pennsylvania Avenue, N.W.
Washington, D.C. 20006
United States
Corporate Financial Advisor and
Independent Director
8. Alfred T. Mockett(*)
British Telecommunications plc.
81 Newgate Street
London, United Kingdom EC1A 7AJ
United Kingdom/
United States
Managing Director of Global
Communications, British
Telecommunications plc.
9. Dr. Alan Rudge(*)
British Telecommunications plc.
81 Newgate Street
United Kingdom
London, United Kingdom EC1A 7AJ
United States
Director, Deputy Group Managing
<PAGE>
CUSIP No. 638595108 Page 14 of 131 Pages
Director and Managing Director,
Development and Procurement, British
Telecommunications plc.
10. Richard B. Sayford(*)
MCI Communications Corporation
1801 Pennsylvania Avenue, N.W.
Washington, D.C. 20006
11. Gerald H. Taylor(*)
MCI Communications Corporation
1801 Pennsylvania Avenue, N.W.
Washington, D.C. 20006
United States
President and Chief Operating Officer,
MCI Communications Corporation
12. Judith Whittaker(*)
Hallmark Cards, Inc.
2501 McGee Trafficway
Kansas City, MO 64108
United States
Vice President-Legal, Hallmark Cards,
Incorporated
13. John R. Worthington(*)
MCI Communications Corporation
1801 Pennsylvania Avenue, N.W.
Washington, D.C. 20006
United States
Senior Vice President and General Counsel,
MCI Communications Corporation
14. Timothy F. Price
MCI Telecommunications Corporation
Three Ravinia Drive
Atlanta, GA 30346-2102
United States
Executive Vice President and GroupPresident,
MCI Telecommunications Corporation
15. Seth D. Blumenfeld
MCI International, Inc.
Two International Drive
Rye Brook, New York 10573
United States
President, MCI International, Inc.
16. Angela O. Dunlap
MCI Telecommunications Corporation
1200 South Hayes Street
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CUSIP No. 638595108 Page 15 of 131 Pages
Arlington, VA 22202
United States
Executive Vice President, MCI
Telecommunications Corporation
17. John W. Gerdelman
MCI Telecommunications Corporation
1801 Pennsylvania Avenue, N.W.
Washington, D.C. 20006
United States
Executive Vice President,
MCI Telecommunications Corporation
18. Douglas L. Maine
MCI Communications Corporation
1801 Pennsylvania Avenue, N.W.
Washington, D.C. 20006
United States
Executive Vice President and
Chief Financial Officer,
MCI Communications Corporation
19. Scott B. Ross
MCI Telecommunications
Corporation
Three Ravinia Drive
Atlanta, GA 30346-2102
United States
Executive Vice President, MCI
Telecommunications Corporation
20. Michael J. Rowny
MCI Communications Corporation
1801 Pennsylvania Avenue, N.W.
Washington, D.C. 20006
United States
Executive Vice President, MCI
Communications Corporation
21. Fred M. Briggs
MCI Telecommunications
Corporation
1650 Tysons Boulevard
McLean, VA 22102
United States
Senior Vice President,
MCI Telecommunications Corporation
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CUSIP No. 638595108 Page 16 of 131 Pages
22. Laurence E. Harris
MCI Communications Corporation
1801 Pennsylvania Avenue, N.W.
Washington, D.C. 20006
United States
Senior Vice President,
MCI Communications Corporation
<PAGE>
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CUSIP No. 638595108 Page 17 of 131 Pages
SCHEDULE B
Name of Stockholder
1. Merv Adelson
2. Stephen Katz
3. Jay Bernstein
4. Mel Steinberg
5. Larry Altman
6. Jerome Sanders
7. Joseph A. Gregori
<PAGE>
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CUSIP No. 638595108 Page 18 of 131 Pages
INDEX TO EXHIBITS
Exhibit Number Description of Exhibits
1. Agreement and Plan of Merger, dated as of May 22,
1995, among MCI Communications Corporation, NTS
Acquisition Corp. and Nationwide Cellular Service,
Inc.
2. Voting Agreement, dated as of May 22, 1995, among
MCI Communications Corporation, NTS Acquisition
Corp. and Merv Adelson.
3. Voting Agreement, dated as of May 22, 1995, among
MCI Communications Corporation, NTS Acquisition
Corp. and Stephen Katz.
4. Voting Agreement, dated as of May 22, 1995, among
MCI Communications Corporation, NTS Acquisition
Corp. and Jay Bernstein.
5. Voting Agreement, dated as of May 22, 1995, among
MCI Communications Corporation, NTS Acquisition
Corp. and Mel Steinberg.
6. Voting Agreement, dated as of May 22, 1995, among
MCI Communications Corporation, NTS Acquisition
Corp. and Larry Altman.
7. Voting Agreement, dated as of May 22, 1995, among
MCI Communications Corporation, NTS Acquisition
Corp. and Jerome Sanders.
8. Voting Agreement, dated as of May 22, 1995, among
MCI Communications Corporation, NTS Acquisition
Corp. and Joseph A. Gregori.
<PAGE>
Exhibit 1 Page 19 of 131 Pages
AGREEMENT AND PLAN OF MERGER
AGREEMENT AND PLAN OF MERGER, dated May 22, 1995 (this
"Agreement"), among MCI COMMUNICATIONS CORPORATION, a Delaware
corporation (the "Parent"), NTS ACQUISITION CORP., a Delaware
corporation and an indirect wholly owned
subsidiary of the Parent (the "Purchaser"), and NATIONWIDE
CELLULAR SERVICE, INC., a Delaware corporation (the "Company").
WHEREAS, the Boards of Directors of the Company and the
Purchaser have approved, and deem it advisable and in the best
interests of their respective stockholders to consummate, the
business combination transaction provided for herein in which the
Purchaser will merge with and into the Company (the "Merger");
WHEREAS, the Merger and this Agreement require the vote
of a majority of the shares of Company Common Stock (as defined
below) for the approval thereof;
WHEREAS, as a condition and inducement to their
willingness to enter into this Agreement and to consummate the
transactions contemplated hereby, the Parent and the Purchaser
have required that each of the stockholders listed on Schedule A
hereto agree, simultaneously with the execution of this
Agreement, to execute and deliver a Voting Agreement (a "Voting
Agreement") and, pursuant thereto, to grant a proxy to vote in
favor of the Merger (a "Management Proxy"); and in order to
induce the Parent and the Purchaser to enter into this Agreement,
each of such shareholders has agreed to execute a Voting
Agreement and Management Proxy simultaneously with the execution
of this Agreement;
WHEREAS, as a further condition and inducement to their
willingness to enter into this Agreement and to consummate the
transactions contemplated hereby, the Parent and the Purchaser
have required that Mr. Merv Adelson ("Mr. Adelson") agree,
simultaneously with the execution of this Agreement, to execute
and deliver a Voting Agreement (the "Adelson Agreement") and,
pursuant thereto (i) to grant a proxy to vote in favor of the
Merger (the "Adelson Proxy," and together with the Management
Proxies, the "Proxies") and (ii) to waive certain rights and make
certain undertakings with respect to the Warrant (the "Warrant")
to purchase up to 850,000 shares of the Company Common Stock (as
defined below) at an exercise price of $11.00 per share; and in
order to induce the Parent and the Purchaser to enter into this
Agreement, Mr. Adelson has agreed to execute and deliver the
Adelson Agreement simultaneously with the execution of this
Agreement;
WHEREAS, the Parent, the Purchaser and the Company
<PAGE>
Exhibit 1 Page 20 of 131 Pages
desire to make certain representations, warranties, covenants and
agreements in connection with the Merger and also to prescribe
various conditions to the Merger; and
NOW, THEREFORE, in consideration of the foregoing and
the respective representations, warranties, mutual covenants and
agreements herein contained, and intending to be legally bound
hereby, the Parent, the Purchaser and the Company hereby agree as
follows:
ARTICLE I
THE MERGER
SECTION 1.1 The Merger. Upon the terms and subject to
the conditions set forth in this Agreement, and in accordance
with the General Corporation Law of the State of Delaware (the
"DGCL"), at the Effective Time (as defined in Section 1.3 below),
the Purchaser shall be merged with and into the Company. Upon
the Effective Time, the separate corporate existence of the
Purchaser shall cease, and the Company shall continue as the
surviving corporation of the Merger (the "Surviving Corporation")
and shall continue under the name Nationwide Cellular Service,
Inc. At the Parent's election, the Merger may alternatively be
structured so that (i) the Company is merged with and into the
Parent, the Purchaser or any other direct or indirect subsidiary
of the Parent or (ii) any direct or indirect subsidiary of the
Parent other than the Purchaser is merged with and into the
Company. In the event of such an election, the parties agree to
execute an appropriate amendment to this Agreement in order to
reflect such election.
SECTION 1.2 Closing. Unless this Agreement shall have
been terminated and the transactions herein contemplated shall
have been abandoned pursuant to Section 6.1 and subject to the
satisfaction or waiver of the conditions set forth in Article V,
the closing of the Merger (the "Closing") will take place as
promptly as practicable (and in any event within two business
days) following satisfaction or waiver of the conditions set
forth in Article V (the "Closing Date"), at the offices of
Simpson Thacher & Bartlett, 425 Lexington Avenue, New York, New
York 10017, unless another date, time or place is agreed to in
writing by the parties hereto.
SECTION 1.3 Effective Time of the Merger. As soon as
practicable after the satisfaction or waiver of the conditions
set forth in Article V, the parties hereto shall cause the Merger
to be consummated by filing this Agreement or a certificate of
merger or a certificate of ownership and merger (the "Certificate
of Merger") with the Secretary of State of the State of Delaware,
in such form as required by, and executed in accordance with the
<PAGE>
Exhibit 1 Page 21 of 131 Pages
relevant provisions of, the DGCL (the date and time of the filing
of the Certificate of Merger with the Secretary of State of the
State of Delaware (or such later time as is specified in the
Certificate of Merger) being the "Effective Time").
SECTION 1.4 Effects of the Merger. The Merger shall
have the effects set forth in Section 259 of the DGCL. Without
limiting the generality of the foregoing, and subject thereto, at
the Effective Time all the properties, rights, privileges,
immunities, powers and franchises of the Company and the
Purchaser shall vest in the Surviving Corporation, and all debts,
liabilities and duties of the Company and the Purchaser shall
become the debts, liabilities and duties of the Surviving
Corporation.
SECTION 1.5 Certificate of Incorporation; By-Laws.
(a) At the Effective Time, the Certificate of Incorporation of
the Surviving Corporation shall be amended in accordance with the
DGCL such that, at the Effective Time, the Certificate of
Incorporation of the Surviving Corporation shall consist of the
provisions set forth in the Certificate of Incorporation of the
Purchaser, as in effect immediately prior to the Effective Time,
except that Article I of the Certificate of Incorporation of the
Surviving Corporation shall read in its entirety as follows:
"The name of this Corporation is 'Nationwide Cellular Service,
Inc.'"
(b) At the Effective Time and without any other
further action on the part of the Company and the Purchaser, the
By-Laws of the Purchaser shall be the By-Laws of the Surviving
Corporation and thereafter may be amended or repealed in
accordance with their terms or the Certificate of Incorporation
of the Surviving Corporation and as provided by law.
SECTION 1.6 Directors and Officers. The directors of
the Purchaser immediately prior to the Effective Time shall be
the initial directors of the Surviving Corporation, each to hold
office in accordance with the Certificate of Incorporation and
By-Laws of the Surviving Corporation, and the officers of the
Company immediately prior to the Effective Time shall be the
initial officers of the Surviving Corporation, in each case until
their respective successors are duly elected or appointed, as the
case may be, and qualified.
Section 1.7 Stockholders' Meeting. The Company will
take all action necessary in accordance with and subject to
applicable law and its Certificate of Incorporation and By-Laws
to convene a meeting of its stockholders (the "Stockholders'
Meeting") as soon as practicable after the date of this Agreement
to consider and vote upon the adoption and authorization of this
Agreement. Subject to the fiduciary duties of the Board of
<PAGE>
Exhibit 1 Page 22 of 131 Pages
Directors to the stockholders of the Company, the Company,
through its Board of Directors, shall recommend to its
stockholders adoption and authorization of this Agreement and the
transactions contemplated hereby and shall use all reasonable ef-
forts to obtain adoption and authorization of this Agreement and
the Merger by the stockholders of the Company.
SECTION 1.8 Company Action. The Company hereby
approves of and consents to the Merger and represents and
warrants that its Board of Directors, at a meeting duly called
and held on May 21, 1995, has (a) determined that this Agreement
and the transactions contemplated hereby, including (i) the
Merger and (ii) the declaration and payment of the Spin-Off
Distribution (as defined below) of the common stock ("CTS Common
Stock"), par value $.001 per share, of Cellular Technical
Services Company, Inc. ("CTS") owned by the Company (and to be
owned by the Company following the exercise of warrants to
purchase CTS Common Stock as contemplated hereby), taken
together, are fair to and in the best interests of the holders of
the shares of Company Common Stock, (b) approved this Agreement
and the transactions contemplated hereby (other than the Spin-Off
Distribution), and (c) resolved to recommend that the
stockholders of the Company approve this Agreement and the
transactions contemplated hereby; provided, however, that it is
understood and agreed that stockholder approval is not required
in order to consummate the Spin-Off Distribution, and unless
necessary in order to obtain the no-action letter contemplated by
Section 4.11(e) hereof or to consummate the Spin-Off
Distribution, stockholder approval thereof will not be sought.
The Company further represents and warrants that the approvals
referred to in clause (b) above include and constitute approval
of this Agreement, the Voting Agreements, the Warrant Agreement,
the grant of the Proxies and the transactions contemplated hereby
and thereby, including the Merger, for purposes of Section 203 of
the DGCL.
ARTICLE II
EFFECT OF THE MERGER ON THE CAPITAL STOCK OF THE
CONSTITUENT CORPORATIONS; EXCHANGE OF CERTIFICATES
SECTION 2.1 Effect on Capital Stock. At the Effective
Time, by virtue of the Merger and without any action on the part
of the holders of any shares of Common Stock, par value $.10 per
share, of the Company (the "Company Common Stock"), or any shares
of capital stock of the Purchaser:
(a) Common Stock of the Purchaser. Each share of
Common Stock, par value $.10 per share, of the Purchaser issued
and outstanding immediately prior to the Effective Time shall be
converted into one validly issued, fully paid and nonassessable
<PAGE>
Exhibit 1 Page 23 of 131 Pages
share of Common Stock, par value $.10 per share, of the Surviving
Corporation, which shall be all of the issued and outstanding
capital stock of the Surviving Corporation.
(b) Cancellation of Treasury Stock and Parent-Owned
Company Common Stock. Each share of Company Common Stock that is
owned by the Company or by any subsidiary of the Company, and
each share of Company Common Stock that is owned by the Parent,
the Purchaser or any other subsidiary of the Parent shall
automatically be cancelled and retired and shall cease to exist,
and no stock of the Parent or other consideration shall be
delivered or deliverable in exchange therefor.
(c) Conversion of Company Common Stock. Except as
otherwise provided herein and subject to Section 2.1(d), each
issued and outstanding share of Company Common Stock (other than
shares to be cancelled in accordance with Section 2.1(b)) shall
be converted into the right to receive $18.50, payable to the
holder thereof, without interest (the "Merger Consideration"),
upon surrender of the certificate formerly representing such
share of Company Common Stock in the manner provided in
Section 2.2. All such shares of Company Common Stock, when so
converted, shall no longer be outstanding and shall automatically
be cancelled and retired and shall cease to exist, and each
certificate previously representing any such shares shall cease
to have any rights with respect thereto, except the right to
receive the Merger Consideration therefor upon the surrender of
such certificates in accordance with Section 2.2, without
interest.
(d) Shares of Dissenting Holders. Notwithstanding
anything in this Agreement to the contrary, shares of Company
Common Stock issued and outstanding immediately prior to the
Effective Time held by holders (if any) who have not voted in
favor of the Merger or consented thereto in writing and who have
demanded appraisal rights with respect thereto in accordance with
Section 262 of the DGCL (the "Dissenting Shares") shall not be
converted as described in Section 2.1(c), but holders of such
shares shall be entitled to receive payment of the appraised
value of such shares in accordance with the provisions of such
Section 262, except that any Dissenting Shares held by a holder
who shall thereafter withdraw such demand for appraisal of such
shares or lose the right to appraisal as provided in Section 262
of the DGCL shall thereupon be deemed to have been converted, at
the Effective Time, as described in Section 2.1(c). The Company
shall give the Parent (i) prompt notice of any written demands
for appraisal of any shares, attempted withdrawals of such
demands, and any other instruments served pursuant to the DGCL
received by the Company relating to stockholders' rights of
appraisal and (ii) the opportunity to direct all negotiations and
proceedings with respect to demands for appraisal under the DGCL.
<PAGE>
Exhibit 1 Page 24 of 131 Pages
The Company shall not, except with the prior written consent of
the Parent, voluntarily make any payment with respect to any
demands for appraisals of capital stock of the Company, offer to
settle or settle any such demands or approve any withdrawal of
any such demands.
SECTION 2.2 Exchange of Certificates.
(a) Paying Agent. The Parent shall designate a bank
or trust company to act as agent for the holders of shares of
Company Common Stock in connection with the Merger, which Paying
Agent shall be reasonably satisfactory to the Company (the
"Paying Agent"), to receive the funds to which holders of shares
of Company Common Stock shall become entitled pursuant to
Section 2.1(c). Such funds shall be invested by the Paying Agent
as directed by the Parent or the Surviving Corporation.
(b) Exchange Procedures. As soon as reasonably
practicable after the Effective Time, the Paying Agent shall mail
to each holder of record of a certificate or certificates which
immediately prior to the Effective Time represented outstanding
shares of Company Common Stock (the "Certificates"), whose shares
were converted pursuant to Section 2.1 into the right to receive
the Merger Consideration (i) a letter of transmittal (which shall
specify that delivery shall be effected, and risk of loss and
title to the Certificates shall pass, only upon proper delivery
of the Certificates to the Paying Agent and shall be in such form
and have such other provisions as the Parent and the Company may
reasonably specify) and (ii) instructions to effect the surrender
of the Certificates in exchange for payment of the Merger
Consideration. Upon surrender of one or more Certificates for
cancellation to the Paying Agent or to such other agent or agents
as may be appointed by the Parent, which agents shall be
reasonably satisfactory to the Company, together with such letter
of transmittal, duly executed, the holder of such Certificates
shall be entitled to receive in exchange therefor the Merger
Consideration for each share of Company Common Stock formerly
represented by such Certificate, and the Certificates so
surrendered shall forthwith be cancelled. If payment of the
Merger Consideration is to be made to a person other than the
person in whose name the surrendered Certificate is registered,
it shall be a condition of payment that the Certificate so
surrendered shall be properly endorsed or shall be otherwise in
proper form for transfer and that the person requesting such
payment shall have paid any transfer and other taxes required by
reason of the payment of the Merger Consideration to a person
other than the registered holder of the Certificate surrendered
or shall have established to the satisfaction of the Surviving
Corporation that such tax either has been paid or is not
applicable. Until surrendered as contemplated by this Section
2.2, each Certificate shall be deemed at any time after the
<PAGE>
Exhibit 1 Page 25 of 131 Pages
Effective Time to represent only the right to receive the Merger
Consideration in cash as contemplated by this Section 2.2.
(c) After the Effective Time there shall be no
transfers on the stock transfer books of the Surviving
Corporation of the shares of Company Common Stock which were
outstanding immediately prior to the Effective Time. If, after
the Effective Time, Certificates are presented to the Surviving
Corporation, they shall be cancelled and exchanged for the Merger
Consideration as provided in this Article II.
(d) Termination of Exchange Fund. Any portion of the
funds held by the Paying Agent pursuant to this Section 2.2 which
remain undistributed to the stockholders of the Company for six
months after the Effective Time shall be delivered to the Parent,
upon demand, and any stockholders of the Company who have not
theretofore complied with this Article II shall thereafter look
only to the Parent, and only as general creditors thereof, for
payment of their claim for the Merger Consideration to which such
stockholders may be entitled.
(e) No Liability. None of the Parent, the Purchaser,
the Company or the Paying Agent shall be liable to any holder of
shares of Company Common Stock for any cash delivered to a public
official pursuant to any applicable abandoned property, escheat
or similar law. If any Certificates shall not have been
surrendered prior to five years after the Effective Time (or
immediately prior to such earlier date on which any payment in
respect thereof would otherwise escheat to or become the property
of any Governmental Entity (as defined in Section 3.1(e))), the
payment in respect of such Certificates shall, to the extent
permitted by applicable law, become the property of the Surviving
Corporation, free and clear of all claims or interest of any
person previously entitled thereto.
(f) Withholding Rights. The Parent or the Paying
Agent shall be entitled to deduct and withhold from the
consideration otherwise payable pursuant to this Agreement to any
holder of shares of Company Common Stock such amounts as the
Parent or the Paying Agent is required to deduct and withhold
with respect to the making of such payment under the Code, or any
provision of state, local or foreign tax law, or any court order.
To the extent that amounts are so withheld by the Parent or the
Paying Agent, such withheld amounts shall be treated for all
purposes of this Agreement as having been paid to the holder of
the shares of Company Common Stock in respect of which such
deduction and withholding was made by the Parent or the Paying
Agent.
SECTION 2.3 Treatment of Employee Options. (a) Prior
to the Effective Time, the Board of Directors of the Company (or,
<PAGE>
Exhibit 1 Page 26 of 131 Pages
if appropriate, any committee thereof) shall adopt appropriate
resolutions and take all other actions necessary to provide for
the cancellation, effective at the Effective Time, of all the
outstanding stock options, stock appreciation rights, limited
stock appreciation rights and performance units (the "Options")
heretofore granted under any stock option, performance unit or
similar plan of the Company (the "Stock Plans"). Immediately
prior to the Effective Time, each Option, whether or not then
vested or exercisable, shall no longer be exercisable but shall
entitle each holder thereof (subject to applicable withholding
taxes), in cancellation and settlement therefor, to (i) the
number of shares of CTS Common Stock equal to the product of (x)
the total number of shares of Company Common Stock subject, or
related, to such Option, and (y) the number of shares of CTS
Common Stock distributable per share of Company Common Stock; and
(ii) a cash payment equal to (x) the excess, if any, of the
Merger Consideration over the exercise price of each Option held
by the holder, whether or not then vested or exercisable,
multiplied by (y) the number of shares of Company Common Stock
subject to such Option. Each distribution of CTS Common Stock
shall be made to each holder of an outstanding Option as soon as
practicable on or after the Effective Time; provided, however,
that no fractional shares shall be distributed hereunder and in
lieu thereof an Option holder shall receive the cash value of any
fractional share of CTS Common Stock due to the Option holder
under the terms of this Section 2.3(a). Any amounts payable or
shares distributable to an Option holder under this Section
2.3(a) shall be reduced by the amount of any applicable
withholding taxes.
(b) As provided herein, the Stock Plans and any other
plan, program or arrangement providing for the issuance or grant
of any other interest in respect of the capital stock of the
Company or any subsidiary (collectively with the Stock Plans,
referred to as the "Stock Incentive Plans") shall terminate as of
the Effective Time. The Company will take all necessary steps to
ensure that none of the Parent, the Company or any of their
respective subsidiaries is or will be bound by any Options, other
options, warrants, rights or agreements which would entitle any
person, other than Parent or its affiliates, to own any capital
stock of the Surviving Corporation or any of its subsidiaries or
to receive any payment in respect thereof after the Effective
Time. The Company will use its best efforts to obtain all
necessary consents to ensure that after the Effective Time, the
only rights of the holders of Options to purchase shares of
Common Stock in respect of such Options will be to receive the
distribution provided herein in cancellation and settlement
thereof.
(c) The aggregate exercise price of all Options and
the Warrant, together with the warrant owned by Jay Brown to
<PAGE>
Exhibit 1 Page 27 of 131 Pages
acquire 125,000 shares of Company Common Stock equals
$25,496,534.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
SECTION 3.1 Representations and Warranties of the
Company. The Company hereby represents and warrants to the
Parent and the Purchaser as follows:
(a) Organization and Qualification; Subsidiaries.
Each of the Company and each of its subsidiaries is a corporation
duly organized, validly existing and in good standing under the
laws of the jurisdiction of its incorporation and has the
requisite corporate power and authority and any necessary
governmental approvals to own, lease and operate its properties
and to carry on its business as it is now being conducted, except
where the failure to be so organized, existing and in good
standing or to have such power, authority and governmental
approvals could not, individually or in the aggregate, reasonably
be expected to have a Material Adverse Effect (as defined below).
Each of the Company and each of its subsidiaries is duly
qualified or licensed as a foreign corporation to do business,
and is in good standing, in each jurisdiction where the character
of the properties owned, leased or operated by it or the nature
of its activities makes such qualification or licensing
necessary, except for such failures to be so duly qualified or
licensed and in good standing which could not, individually or in
the aggregate, reasonably be expected to have a Material Adverse
Effect.
When used in connection with the Company or any of its
subsidiaries, the term "Material Adverse Effect" means any change
or effect that is or could reasonably be expected to be
materially adverse to the business, assets, results of
operations, condition (financial or other) or prospects of the
Company and its subsidiaries taken as a whole or to impair the
ability of the Company to perform its obligations hereunder or
under the other agreements to which it is or is to become a party
as contemplated hereby.
(b) Certificates of Incorporation and By-Laws. The
Company has heretofore furnished to the Parent a complete and
correct copy of the Certificate of Incorporation and the By-Laws
of the Company and each subsidiary of the Company as currently in
effect. The Certificate of Incorporation and By-Laws of the
Company are in full force and effect and no other organizational
documents are applicable to or binding upon the Company. The
Certificates of Incorporation and By-Laws of each of the
Company's subsidiaries are in full force and effect and no other
<PAGE>
Exhibit 1 Page 28 of 131 Pages
organizational documents are binding upon any such subsidiary.
Neither the Company nor any subsidiary thereof is in violation of
any of the provisions of its Certificate of Incorporation or By-
Laws.
(c) Capitalization. The authorized capital stock of
the Company consists of 20,000,000 shares of Company Common Stock
and 800,000 shares of Preferred Stock, $.01 par value per share
(collectively, "Company Preferred Stock"). As of May 19, 1995,
(i) 7,938,599 shares of Company Common Stock were issued and
outstanding, all of which were validly issued, fully paid and
nonassessable and were issued free of preemptive (or similar)
rights, (ii) 32,000 shares of Company Common Stock were held in
the treasury of the Company, (iii) an aggregate of 1,423,940
shares of Company Common Stock were reserved for issuance and
issuable upon or otherwise deliverable in connection with the
exercise of outstanding employee Options issued pursuant to the
Plans (as defined in Section 3.1(l)) and (iv) an aggregate of
975,000 shares of Company Common Stock were reserved for issuance
and issuable upon exercise of certain stock purchase warrants,
including the Warrant. Since May 19, 1995, no options to
purchase shares of Company Common Stock have been granted and no
shares of Company Common Stock have been issued except for shares
issued pursuant to the exercise of employee Options outstanding
as of May 19, 1995. As of the date hereof, no shares of Company
Preferred Stock are issued and outstanding. Except as set forth
above and except as a result of the exercise of employee Options
outstanding as of May 19, 1995, there are outstanding (i) no
shares of capital stock or other voting securities of the
Company, (ii) no securities of the Company convertible into or
exchangeable or exercisable for shares of capital stock or voting
securities of the Company, (iii) no options or other rights to
acquire from the Company or any subsidiary, and no obligation of
the Company or any subsidiary to issue, any capital stock, voting
securities or securities convertible into or exchangeable or
exercisable for capital stock or voting securities of the Company
or any subsidiary and (iv) no equity equivalents, interests in
the ownership or earnings of the Company or any subsidiary or
other similar rights (collectively, "Company Securities").
Except as set forth on Schedule 3.1(c) hereto, there are no
outstanding obligations of the Company or any of its subsidiaries
to repurchase, redeem or otherwise acquire any Company
Securities, and there are no other options, calls, warrants or
other rights, agreements, arrangements or commitments of any
character relating to the issued or unissued capital stock of the
Company or any of its subsidiaries to which the Company or any of
its subsidiaries is a party. All shares of Company Common Stock
subject to issuance as aforesaid, upon issuance on the terms and
conditions specified in the instruments pursuant to which they
are issuable, shall be duly authorized, validly issued, fully
paid and nonassessable and free of preemptive (or similar)
<PAGE>
Exhibit 1 Page 29 of 131 Pages
rights. There are no outstanding contractual obligations of the
Company or any of its subsidiaries to repurchase, redeem or
otherwise acquire any shares of Company Common Stock or the
capital stock of any subsidiary or, except as described in
Schedule 3.1(c) hereto, to provide funds to or make any
investment (in the form of a loan, capital contribution,
guarantee or otherwise) in any such subsidiary or any other
entity. Except as set forth in Schedule 3.1(c) hereto, each of
the outstanding shares of capital stock of each of the Company's
subsidiaries is duly authorized, validly issued, fully paid and
nonassessable and is owned free and clear of all security
interests, liens, claims, pledges, agreements, limitations in
voting rights, charges or other encumbrances of any nature
whatsoever, except where the failure to own such shares free and
clear could not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect. Attached as Annex A
hereto is a list of the subsidiaries of the Company and other
entities in which the Company holds an equity interest which
evidences the percentage of capital stock or other equity
interests owned by the Company, directly or indirectly, in such
subsidiaries or entities. Except for Mobile Datacom Corporation
common stock, of which the Company on the date hereof owns
736,945 shares, representing 25% of its outstanding common stock,
and except for CTS Common Stock, of which the Company (i) on the
date hereof owns 3,340,000 shares, representing 33.56% of its
outstanding common stock, (ii) following the full exercise of the
warrant to purchase additional shares of CTS Common Stock (the
"CTS Warrant"), will own 3,980,000 shares representing 37.58% of
its outstanding common stock, and (iii) Page Telecommunications
Inc., in which the Company has invested $70,000 in exchange for a
warrant to purchase 20,000 shares of common stock and a $70,000
promissory note due 2003, and the Company does not own, directly
or indirectly, less than a 50% equity interest in any other
corporation, partnership, joint venture or other entity.
(d) Authority Relative to Agreements. The Company has
all necessary corporate power and authority to execute and
deliver this Agreement, to declare and make payment of the Spin-
Off Distribution, to perform its obligations hereunder and to
consummate the transactions contemplated hereby. The execution,
delivery and performance of this Agreement by the Company, the
consummation by the Company of the transactions contemplated
hereby (other than the declaration and payment of the Spin-Off
Distribution) have been duly and validly authorized by all
necessary corporate action and no other corporate proceedings on
the part of the Company are necessary to authorize this Agreement
or to consummate such transactions (other than the approval and
adoption of the Merger and this Agreement by the holders of a
majority of the outstanding shares of Company Common Stock, and,
with respect to the Merger, the filing of appropriate merger
documents as required by the DGCL and the declaration by the
<PAGE>
Exhibit 1 Page 30 of 131 Pages
Board of Directors of the Company of the Spin-Off Distribution).
This Agreement has been duly and validly executed and delivered
by the Company and, assuming the due authorization, execution and
delivery hereof by the other parties thereto, constitutes a
legal, valid and binding obligation of the Company enforceable
against the Company in accordance with its terms. The only vote
required to authorize the Merger is the affirmative vote of a
majority of the outstanding shares of Company Common Stock. The
approval of the transactions contemplated by this Agreement,
including the Merger, the Warrant Agreement and the grant of the
Proxies, by the Board of Directors of the Company shall
constitute, for the purposes of Section 203 of the DGCL, the
approval of a "business combination" (as defined in Section 203
of the DGCL) between the Company and the Parent or any affiliate
thereof.
(e) No Conflict; Required Filings and Consents. (i)
The execution, delivery and performance of this Agreement by the
Company and the declaration and payment of the Spin-Off
Distribution do not and will not: (A) conflict with or violate
the Certificate of Incorporation or By-Laws of the Company or the
equivalent organizational documents of any of its subsidiaries;
(B) assuming that all consents, approvals and authorizations
contemplated by subsection (ii) below have been obtained and all
filings described in such clauses have been made, conflict with
or violate any law, rule, regulation, order, judgment or decree
applicable to the Company or any of its subsidiaries or by which
its or any of their respective properties are bound or affected;
or (C) result in any breach or violation of or constitute a
default (or an event which with notice or lapse of time or both
could become a default) or result in the loss of a benefit under,
or give rise to any right of termination, amendment, acceleration
or cancellation of, or result in the creation of a lien or
encumbrance on any of the properties or assets of the Company or
any of its subsidiaries pursuant to, any note, bond, mortgage,
indenture, contract, agreement, lease, license, permit, franchise
or other instrument or obligation to which the Company or any of
its subsidiaries is a party or by which the Company or any of its
subsidiaries or its or any of their respective properties are
bound or affected, except, in the case of clauses (B) and (C),
for any such conflicts, violations, breaches, defaults or other
occurrences which could not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect. The
Company has, and on the date the Board of Directors declares the
Spin-Off Distribution and on the Spin-Off Distribution Payment
Date (as defined below) will have, the ability to declare and pay
the Spin-Off Distribution under Section 170 of the DGCL.
(ii) The execution, delivery and performance of this
Agreement by the Company and the consummation of the transactions
contemplated hereby by the Company do not and will not require
<PAGE>
Exhibit 1 Page 31 of 131 Pages
any consent, approval, authorization or permit of, action by,
filing with or notification to, any court, administrative agency
or commission, or entity created by rule, regulation or order of
any commission or other governmental authority or other
governmental authority or instrumentality, domestic or foreign (a
"Governmental Entity"), except for: (A) the filing with the SEC
of (1) a proxy statement in definitive form relating to the
Stockholders' Meeting (such proxy statement as amended or
supplemented from time to time, the "Proxy Statement") and (2)
such other filings under the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), or the Securities Act of 1933, as
amended (the "Securities Act"), as may be required in connection
with this Agreement and the transactions contemplated hereby and
the obtaining from the SEC of such orders as may be required in
connection therewith; (B) applicable filings, if any, pursuant to
the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as
amended (the "HSR Act"); (C) applicable permits, licenses,
waivers, authorizations, approvals and certificates of public
convenience and necessity ("Licenses"), including Licenses by the
Federal Communications Commission ("FCC") and state public
utility or public service commissions ("Public Utility
Commissions") which are necessary to enable the Company and its
subsidiaries to conduct their operations after the Merger in the
manner heretofore conducted (collectively, the "Regulatory
Requirements") and which are listed in Schedule 3.1(e) hereto;
(D) the filing and recordation of appropriate merger or other
documents as required by the DGCL; (E) compliance with the
statutory provisions and regulations relating to real property
transfer gains taxes and real property transfer taxes; and (F)
such consents, approvals, authorizations, permits, actions,
filings or notifications which the failure to make or obtain
could not individually or in the aggregate reasonably be expected
to (x) prevent consummation of Merger or materially delay the
Merger, (y) otherwise prevent or delay the Company from
performing its obligations under this Agreement or (z)
individually or in the aggregate, have a Material Adverse Effect.
(f) Compliance. The Company and its subsidiaries hold
all Licenses, variances, exemptions, orders and approvals of all
Governmental Entities necessary or appropriate for the operation
of the businesses of the Company and each subsidiary, except to
the extent the failure to hold such will not have a Material
Adverse Effect on the Company or any such subsidiary. Neither
the Company nor any of its subsidiaries is in conflict with, or
in default or violation of, (i) any law, rule, regulation, order,
judgment or decree applicable to the Company or any of its
subsidiaries or by which its or any of their respective
properties are bound or affected, or (ii) any note, bond,
mortgage, indenture, contract, agreement, lease, License, permit,
franchise or other instrument or obligation to which the Company
or any of its subsidiaries is a party or by which the Company or
<PAGE>
Exhibit 1 Page 32 of 131 Pages
any of its subsidiaries or its or any of their respective
properties are bound or affected, except for any such conflicts,
defaults or violations which could not, individually or in the
aggregate, reasonably be expected to have a Material Adverse
Effect on the Company or any such subsidiary.
(g) SEC Filings; Financial Statements. (i) The
Company, each of its then or current subsidiaries (to the extent
applicable) and, to the best knowledge of the Company, CTS, have
filed all forms, reports, statements and documents required to be
filed with the SEC since January 1, 1992 (collectively, the "SEC
Reports"), each of which has complied in all material respects
with the applicable requirements of the Securities Act or the
Exchange Act, as applicable, each as in effect on the date so
filed. The Company has delivered to the Parent, in the form
filed with the SEC (including any amendments thereto), (A) its
(and, to the extent applicable, its subsidiaries') Annual Reports
on Form 10-K for each of the three fiscal years ended December
31, 1992, 1993 and 1994, and the Quarterly Report on Form 10-Q
for the quarter ended March 31, 1995 (the "March 1995 10-Q") (B)
all definitive proxy statements relating to the Company's (and
such subsidiaries') meetings of stockholders (whether annual or
special) held since January 1, 1992 and (C) all other reports or
registration statements filed by the Company (and such
subsidiaries) with the SEC since January 1, 1992. None of such
forms, reports or documents (including but not limited to any
financial statements or schedules included or incorporated by
reference therein) filed by the Company and its then or current
subsidiaries contained, when filed, any untrue statement of a
material fact or omitted to state a material fact required to be
stated or incorporated by reference therein or necessary in order
to make the statements therein, in the light of the circumstances
under which they were made, not misleading. Except to the extent
revised or superseded by a subsequent filing with the SEC (a copy
of which has been provided to the Parent prior to the date
hereof), none of the SEC Reports filed by the Company since
December 31, 1994 and prior to the date hereof contains any
untrue statement of a material fact or omits to state a material
fact required to be stated or incorporated by reference therein
or necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not
misleading.
(ii) Each of the audited and unaudited consolidated
interim financial statements of the Company (including, in each
case, any related notes thereto) included in its Annual Reports
on Form 10-K for each of the three fiscal years ended
December 31, 1992, 1993 and 1994, and in the March 1995 10-Q,
which have previously been furnished to the Parent, complies as
to form in all material respects with applicable accounting
requirements and with the published rules and regulations of the
<PAGE>
Exhibit 1 Page 33 of 131 Pages
SEC with respect thereto, has been prepared in accordance with
generally accepted accounting principles applied on a consistent
basis throughout the periods involved (except as may be indicated
in the notes thereto) and each fairly presents the consolidated
financial position of the Company and its subsidiaries at the
respective dates thereof and the consolidated results of its
operations and changes in cash flows for the periods indicated.
(iii) Except as and to the extent set forth on the
consolidated balance sheet of the Company and its subsidiaries at
December 31, 1994, including the notes thereto, neither the
Company nor any of its subsidiaries has any liabilities or
obligations of any nature (whether accrued, absolute, contingent
or otherwise) which would be required to be reflected on a
balance sheet or in the notes thereto prepared in accordance with
generally accepted accounting principles, except for liabilities
or obligations incurred in the ordinary course of business since
December 31, 1994 which could not, individually or in the
aggregate, reasonably be expected to have a Material Adverse
Effect.
(iv) The Company has heretofore furnished to the
Parent a complete and correct copy of any amendments or
modifications, which have not yet been filed with the SEC, to
agreements, documents or other instruments which previously were
filed by the Company with the SEC pursuant to the Securities Act
or the Exchange Act or which would be required to be so filed in
connection with the filing of any annual or interim report or
registration statement.
(h) Information Supplied. The Proxy Statement (or any
amendment thereof or supplement thereto) will, at the date of
mailing to stockholders of the Company and at the time of the
Stockholders' Meeting to be held in connection with the Merger,
not contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or
necessary in order to make the statements therein, in the light
of the circumstances under which they were made, not misleading,
except that no representation is made by the Company with respect
to statements made therein based on information supplied by the
Parent or the Purchaser in writing for inclusion in the Proxy
Statement. The Proxy Statement will comply as to form in all
material respects with the provisions of the Exchange Act and the
rules and regulations thereunder.
(i) Absence of Certain Changes or Events. Since
December 31, 1994, except as contemplated by this Agreement, as
set forth on Schedule 3.1(i) hereto or disclosed in the SEC
Reports filed since that date and up to the date of this
Agreement, the Company and its subsidiaries have conducted their
businesses only in the ordinary course and in a manner consistent
<PAGE>
Exhibit 1 Page 34 of 131 Pages
with past practice and, since such date, there has not been (i)
any condition, event or occurrence which, individually or in the
aggregate, has had, or could reasonably be expected to have, a
Material Adverse Effect, (ii) any termination or cancellation of,
or any modification to, any agreement, arrangement or
understanding pursuant to which the Company purchases or has the
right to purchase cellular telephone service, or to any other
agreement, arrangement or understanding which is material to the
Company or to any subsidiary thereof, which is or could
reasonably be expected to be adverse to the Company, any
subsidiary of the Company, the Parent or the Purchaser, (iii)
any change by the Company in its accounting methods, principles
or practices, (iv) any revaluation by the Company of any of its
material assets, including but not limited to writing down the
value of inventory or writing off notes or accounts receivable
other than in the ordinary course of business, (v) any entry by
the Company or any of its subsidiaries into any commitment or
transactions material to the Company or any such subsidiary, (vi)
except for the Spin-Off Distribution, any declaration, setting
aside or payment of any dividends or distributions in respect of
the shares of Company Common Stock or any redemption, purchase or
other acquisition of any of its securities, or (vii) any increase
in or establishment of any bonus, insurance, severance, deferred
compensation, pension, retirement, profit sharing, stock option
(including, without limitation, the granting of stock options,
stock appreciation rights, performance awards, or restricted
stock awards), stock purchase or other employee benefit plan or
agreement or arrangement, or any other increase in the
compensation payable or to become payable to any officers or key
employees of the Company or any of its subsidiaries.
(j) Absence of Litigation. Except as disclosed in the
Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 1994, there are no suits, claims, actions,
proceedings or investigations pending or, to the knowledge of the
Company, threatened against the Company or any of its
subsidiaries, or any properties or rights of the Company or any
of its subsidiaries, or, to the best knowledge of the Company,
against CTS in circumstances in which a claim against the
Company, as a controlling person or otherwise, is possible,
before any court, arbitrator or administrative, governmental or
regulatory authority or body, domestic or foreign, that (i)
individually or in the aggregate, could reasonably be expected to
have a Material Adverse Effect or (ii) seek to delay or prevent
the consummation of the transactions contemplated hereby. As of
the date hereof, neither the Company nor any of its subsidiaries
nor any of their respective properties is or are subject to any
order, writ, judgment, injunction, decree, determination or award
having, or which could reasonably be expected to have, a Material
Adverse Effect or which could prevent or delay the consummation
of the transactions contemplated hereby.
<PAGE>
Exhibit 1 Page 35 of 131 Pages
(k) Employment and Labor Contracts. (i) Except as
disclosed in the SEC Reports or on Schedule 3.1(k) hereto, there
exist no employment, consulting, severance or indemnification
agreements between the Company and any current or former
director, officer or employee of the Company pursuant to which
the Company has, or may have, obligations as of the date hereof,
and no such person is entitled to any severance benefits from the
Company or any of its subsidiaries.
(ii) Neither the Company nor any of its subsidiaries
is a party to any collective bargaining agreement. Since
January 1, 1992, neither the Company nor any of its subsidiaries
has (x) had any employees strikes, work stoppages, slowdowns or
lockouts or (y) received any requests for certifications of
bargaining units or any other requests for collective bargaining.
(l) Employee Benefit Plans. With respect to all the
employee benefit plans, programs and arrangements maintained for
the benefit of any current or former employee, officer or
director of the Company or any subsidiary of the Company
(collectively, the "Plans") and to all the employment,
consulting, severance, change-in-control, termination,
compensation, collective bargaining or indemnification
agreements, arrangements or understandings between the Company or
any of its subsidiaries and any current or former employee,
officer or director of the Company or any of its subsidiaries
(collectively, the "Employment Arrangements"), except as set
forth in the SEC Reports or in the attached Schedule 3.1(l)
hereto and except as could not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect: (i)
there has not been any adoption or amendment by the Company or
any of its subsidiaries of any Plan; (ii) there exists no
Employment Arrangement; (iii) none of the Plans is a
multiemployer plan within the meaning of the Employee Retirement
Income Security Act of 1974, as amended ("ERISA"); (iv) none of
the Plans promises or provides retiree medical or life insurance
benefits to any person, except as otherwise required by law in
the applicable jurisdiction and, outside of the United States, in
accordance with local custom and practice; (v) each Plan intended
to be qualified under Section 401(a) of the Internal Revenue Code
of 1986, as amended, has received a favorable determination
letter from the Internal Revenue Service that it is so qualified
and nothing has occurred since the date of such letter that could
reasonably be expected to affect the qualified status of such
Plan; (vi) each Plan has been operated in all respects in
accordance with its terms and the requirements of applicable law;
(vii) neither the Company nor any subsidiary of the Company has
incurred any direct or indirect liability under, arising out of
or by operation of Title IV of ERISA in connection with the
termination of, or withdrawal from, any Plan or other retirement
plan or arrangement, and no fact or event exists that could
<PAGE>
Exhibit 1 Page 36 of 131 Pages
reasonably be expected to give rise to any such liability; (viii)
the Company and its subsidiaries have not incurred any liability
under, and have complied in all respects with, the Worker
Adjustment Retraining Notification Act, and no fact or event
exists that could give rise to liability under such Act; and (ix)
no Plan or Employment Arrangement exists which could result in
the payment to any current, former or future director or employee
of the Company or any commonly controlled entity of any money or
other property or rights or accelerate or provide any other
rights or benefits to any such employee or director as a result
of the transactions contemplated by this Agreement, whether or
not such payment, acceleration or provision would constitute a
"parachute payment" (within the meaning of Section 280G of the
Code) or whether or not some other subsequent action or event
would be required to cause such payment, acceleration or
provision to be triggered. Except as set forth in the SEC
Reports, the aggregate accumulated benefit obligations of each
Plan subject to Title IV of ERISA (as of the date of the most
recent actuarial valuation prepared for such Plan) do not exceed
the fair market value of the assets of such Plan (as of the date
of such valuation).
(m) Tax Matters. (i) Except as set forth in the SEC
Reports filed prior to the date of this Agreement or in Schedule
3.1(m), (A) the Company and its subsidiaries have filed, been
included in or sent, all material returns, material declarations
and reports and information returns and statements required to be
filed or sent by any of them relating to any Taxes (as defined
below) with respect to any material income, properties or
operations of the Company or any of its subsidiaries
(collectively, "Returns"); (B) as of the time of filing, the
Returns correctly reflected in all material respects the facts
regarding the income, business, assets, operations, activities
and status of the Company and its subsidiaries and any other
material information required to be shown therein; (C) the
Company and its subsidiaries have timely paid or made provision
for all material Taxes that have been shown as due and payable on
the Returns that have been filed; (D) the Company and its
subsidiaries have made or will make provision for all material
Taxes payable for any periods that end before the Effective Time
for which no Returns have yet been filed and for any periods that
begin before the Effective Time and end after the Effective Time
to the extent such Taxes are attributable to the portion of any
such period ending at the Effective Time; (E) the charges,
accruals and reserves for taxes reflected on the books of the
Company and its subsidiaries are adequate under generally
accepted accounting principles to cover the Tax liabilities
accruing or payable by the Company and its subsidiaries in
respect of periods prior to the date hereof; (F) neither the
Company nor any of its subsidiaries is delinquent in the payment
of any material Taxes or has requested any extension of time
<PAGE>
Exhibit 1 Page 37 of 131 Pages
within which to file or send any material Return (other than
extensions granted to the Company for the filing of its Returns
as set forth in Schedule 3.1(m)), which Return has not since been
filed or sent; (G) no material deficiency for any Taxes has been
proposed, asserted or assessed in writing against the Company or
any of its subsidiaries (or any member of any affiliated or
combined group of which the Company or any of its subsidiaries is
or has been a member for which either the Company or any of its
subsidiaries could be liable) other than those Taxes being
contested in good faith by appropriate proceedings and set forth
in Schedule 3.1(m) (which shall set forth the nature of the
proceeding, the type of return, the deficiencies proposed,
asserted or assessed and the amount thereof, and the taxable year
in question); (H) neither the Company nor any of its subsidiaries
has granted any extension of the limitation period applicable to
any material Tax claims other than those Taxes being contested in
good faith by appropriate proceedings; (I) neither the Company
nor any of its subsidiaries is subject to liability for Taxes of
any person (other than the Company or its subsidiaries),
including, without limitation, liability arising from the
application of U.S. Treasury Regulation section 1.1502-6 or any
analogous provision of state, local or foreign law; and
(J) neither the Company nor any of its subsidiaries is or has
been a party to any material tax sharing agreement with any
corporation which is not currently a member of the affiliated
group of which the Company is currently a member.
(ii) "Tax" means with respect to any person (A) any
net income, gross income, gross receipts, sales, use, ad valorem,
franchise, profits, license, withholding, payroll, employment,
excise, severance, stamp, occupation, premium, property, value-
added, windfall profits, custom duty or other tax, governmental
fee, capital stock, social security (or similar), unemployment,
disability, transfer, registration, alternative or add-on
minimum, estimated or other like assessment or charge of any kind
whatsoever, together with any interest and any penalty, addition
to tax or additional amount imposed by any taxing authority
(domestic or foreign) on such person and (B) any liability of the
Company or any subsidiary for the payment of any amount of the
type described in clause (i) as a result of being a member of an
affiliated or combined group.
(iii) The Company's tax basis in the shares of CTS
Common Stock is equal to $2,750,782, and the Company holds such
shares as a long-term capital asset. The Company's tax basis in
the shares of CTS Common Stock to be acquired prior to the
Effective Time upon exercise of the CTS Warrant will be
$1,600,000.
(n) Intellectual Property. Except to the extent that
the inaccuracy of any of the following (or the circumstances
<PAGE>
Exhibit 1 Page 38 of 131 Pages
giving rise to such inaccuracy), individually or in the
aggregate, could not reasonably be expected to have a Material
Adverse Effect: (a) the Company and each of its subsidiaries
owns, or is licensed to use (in each case, clear of any liens or
encumbrances of any kind), all Intellectual Property (as defined
below) used in or necessary for the conduct of its business as
currently conducted; (b) the use of any Intellectual Property by
the Company and its subsidiaries does not infringe on or
otherwise violate the rights of any person and is in accordance
with any applicable license pursuant to which the Company or any
subsidiary acquired the right to use any Intellectual Property;
and (c) to the knowledge of the Company, no person is
challenging, infringing on or otherwise violating any right of
the Company or any of its subsidiaries with respect to any
Intellectual Property owned by and/or licensed to the Company and
its subsidiaries. For purposes of this Agreement "Intellectual
Property" shall mean trademarks, service marks, brand names and
other indications of origin, the goodwill associated with the
foregoing and registrations in any jurisdiction of, and
applications in any jurisdiction to register, the foregoing,
including any extension, modification or renewal of any such
registration or application; inventions, discoveries and ideas,
whether patentable or not in any jurisdiction; patents,
applications for patents (including, without limitation,
divisions, continuations, continuations in part and renewal
applications), and any renewals, extensions or reissues thereof,
in any jurisdiction; nonpublic information, trade secrets and
confidential information and rights in any jurisdiction to limit
the use or disclosure thereof by any person; writings and other
works, whether copyrightable or not in any jurisdiction;
registrations or applications for registration of copyrights in
any jurisdiction, and any renewals or extensions thereof; any
similar intellectual property or proprietary rights; and any
claims or causes of action arising out of or relating to any
infringement or misappropriation of any of the foregoing.
(o) Environmental Matters. Except as disclosed in the
SEC Reports filed prior to the date of this Agreement, there are
no Environmental Liabilities (as defined below) of the Company or
any of its subsidiaries which would, individually or in the
aggregate, have a Material Adverse Effect. As used in this
Agreement, "Environmental Laws" means any and all federal, state,
local or municipal laws, rules, orders, regulations, statutes,
ordinances, codes, decisions, injunctions, orders, decrees,
requirements of any Governmental Entity, any and all common law
requirements, rules and bases of liability regulating, relating
to or imposing liability or standards of conduct concerning
pollution, Hazardous Materials or protection of human health or
the environment, as now or may at any time hereafter be in
effect. "Environmental Liabilities" with respect to any person
means any and all liabilities of or relating to such person or
<PAGE>
Exhibit 1 Page 39 of 131 Pages
any of its subsidiaries (including any entity which is, in whole
or in part, a predecessor of such person or any of such
subsidiaries), whether vested or unvested, contingent or fixed,
actual or potential, known or unknown, which (i) arise under or
relate to matters covered by Environmental Laws and (ii) relate
to actions occurring or conditions existing on or prior to the
Closing Date. "Hazardous Materials" means any hazardous or toxic
substances, materials or wastes, defined, listed, classified or
regulated as such in or under any Environmental Laws, including,
without limitation, asbestos, petroleum or petroleum products
(including gasoline, crude oil or any fraction thereof),
polychlorinated biphenyls, and urea-formaldehyde insulation.
(p) Spin-Off Distribution. The Company will have, on
the date the Spin-Off Distribution is declared, and on the Spin-
Off Distribution Payment Date, sufficient surplus, or if there
shall be no such surplus, net profits for the current fiscal year
and/or preceding fiscal year, to make the Spin-Off Distribution.
(q) Transactions with Affiliates. Except as set forth
on Schedule 3.1(q) hereto, there are no contracts, agreements,
arrangements or understandings of any kind between CTS or any
other affiliate of the Company, on the one hand, and the Company
or any subsidiary of the Company, on the other hand.
(r) Opinion of Financial Advisor. On the date hereof,
the Company has received the opinion of Paine Webber Incorporated
to the effect that, in the context of the transactions
contemplated hereby, the Merger Consideration is fair to the
stockholders of the Company from a financial point of view.
(s) Brokers. No broker, finder or investment banker
(other than Paine Webber Incorporated) is entitled to any
brokerage, finder's or other fee or commission in connection with
the transactions contemplated by this Agreement based upon
arrangements made by and on behalf of the Company. The Company
has heretofore furnished to the Parent a complete and correct
copy of all agreements between the Company and Paine Webber
Incorporated pursuant to which such firm would be entitled to any
payment relating to the transactions contemplated by this
Agreement.
SECTION 3.2 Representations and Warranties of the
Parent and the Purchaser. The Parent and the Purchaser hereby,
jointly and severally, represent and warrant to the Company as
follows:
(a) Corporate Organization. Each of the Parent and
the Purchaser is a corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware and
has the requisite corporate power and authority and any necessary
<PAGE>
Exhibit 1 Page 40 of 131 Pages
governmental authority to own, operate or lease its properties
and to carry on its business as it is now being conducted, except
where the failure to be so organized, existing and in good
standing or to have such power, authority and governmental
approvals could not, individually or in the aggregate, reasonably
be expected to prevent the consummation of the Merger.
(b) Authority Relative to Agreements. Each of the
Parent and the Purchaser has all necessary corporate power and
authority to enter into this Agreement to perform its obligations
hereunder and to consummate the transactions contemplated hereby.
The execution, delivery and performance of this Agreement by each
of the Parent and the Purchaser and, subject to Section 5.2(e),
the consummation by each of the Parent and the Purchaser of the
transactions contemplated hereby have been duly and validly
authorized by all necessary corporate action on the part of the
Parent and the Purchaser, and no other corporate proceedings on
the part of the Parent and the Purchaser are necessary to
authorize this Agreement or to consummate such transactions,
other than filing and recordation of appropriate merger documents
as required by the DGCL and the approval of the Board of
Directors of the Parent. This Agreement has been duly executed
and delivered by each of the Parent and the Purchaser and,
assuming due authorization, execution and delivery by the other
parties hereto, constitutes a legal, valid and binding obligation
of each such corporation enforceable against such corporation in
accordance with its terms.
(c) No Conflict; Required Filings and Consents. (i)
The execution, delivery and performance of this Agreement by the
Parent and the Purchaser do not and will not: (A) conflict with
or violate the respective certificates of incorporation or by-
laws of the Parent or the Purchaser, as the case may be; (B)
assuming that all consents, approvals and authorizations
contemplated by subsection (ii) below have been obtained and all
filings described in such subsection have been made, conflict
with or violate any law, rule, regulation, order, judgment or
decree applicable to the Parent or the Purchaser or by which
either of them or their respective properties are bound or
affected; or (C) result in any breach or violation of or
constitute a default (or an event which with notice or lapse of
time or both could become a default) or result in the loss of a
material benefit under, or give rise to any right of termination,
amendment, acceleration or cancellation of, or result in the
creation of a lien or encumbrance on any of the property or
assets of the Parent or the Purchaser pursuant to, any note,
bond, mortgage, indenture, contract, agreement, lease, License,
franchise or other instrument or obligation to which the Parent
or the Purchaser is a party or by which the Parent or the
Purchaser or any of their respective properties are bound or
affected, except, in the case of clauses (B) and (C), for any
<PAGE>
Exhibit 1 Page 41 of 131 Pages
such conflicts, violations, breaches, defaults or other
occurrences which could not, individually or in the aggregate,
reasonably be expected to prevent the consummation of the Merger.
(ii) The execution, delivery and performance of this
Agreement by the Parent and the Purchaser and the consummation of
the transactions contemplated hereby by the Parent and the
Purchaser do not and will not require any consent, approval,
authorization or permit of, action by, filing with or
notification to, any Governmental Entity, except for: (A)
applicable filings, if any, pursuant to HSR, (B) applicable
requirements, if any, under any License, including any License by
the FCC or any Public Utility Commission, (C) the filing and
recordation of appropriate merger or other documents as required
by the DGCL, (D) compliance with the statutory provisions and
regulations relating to any real property transfer gains tax or
real property transfer tax, (E) applicable filings under state
anti-takeover laws and (F) such consents, approvals,
authorizations, permits, actions, filings or notifications the
failure of which to make or obtain could not, individually or in
the aggregate, reasonably be expected to prevent the consummation
of the Merger.
(d) Information Supplied. None of the information
supplied or to be supplied by the Parent or the Purchaser for
inclusion or incorporation by reference in the Proxy Statement
will, at the date of mailing to stockholders and at the time of
the Stockholders' Meeting, contain any untrue statement of a
material fact or omit to state any material fact required to be
stated therein or necessary in order to make the statements
therein, in the light of the circumstances under which they were
made, not misleading.
(e) Financing. Either the Parent or the Purchaser
has, or will have prior to the satisfaction of the conditions to
the Merger, sufficient funds available (through existing credit
arrangements or otherwise) to deliver the Merger Consideration
with respect to all of the shares of Company Common Stock.
(f) Brokers. No broker, finder or investment banker
(other than Lazard Freres & Company, LLC) is entitled to any
brokerage, finder's or other fee or commission in connection with
the transactions contemplated by this Agreement based upon
arrangements made by and on behalf of the Parent or the
Purchaser.
ARTICLE IV
CONDUCT OF BUSINESS PENDING THE MERGER; OTHER COVENANTS
SECTION 4.1 Conduct of Business of the Company Pending
<PAGE>
Exhibit 1 Page 42 of 131 Pages
the Merger. The Company covenants and agrees that, during the
period from the date hereof to the Effective Time, except
pursuant to the terms hereof, or unless the Parent shall
otherwise agree in writing, the businesses of the Company and its
subsidiaries shall be conducted only in, and the Company shall
not take any action and its subsidiaries shall not take any
action except in the ordinary course of business and in a manner
consistent with past practice and in compliance with applicable
laws; and the Company and its subsidiaries shall each use its
best efforts to preserve intact the business organization of the
Company and its subsidiaries, to keep available the services of
the present officers, employees and consultants of the Company
and its subsidiaries and to preserve the present relationships of
the Company and its subsidiaries with customers, providers of
cellular telephone service and other suppliers and other persons
with which the Company or any of its subsidiaries has significant
business relations. By way of amplification and not limitation,
neither the Company nor any of its subsidiaries shall, between
the date of this Agreement and the Effective Time, directly or
indirectly do, or propose or commit to do, any of the following
without the prior written consent of the Parent:
(a) (i) declare, set aside or pay any dividends on,
or make any other distributions in respect of, any of its
capital stock (except (x) the Spin-Off Distribution or (y)
dividends and distributions by a wholly owned subsidiary of
the Company to its parent), (ii) split, combine or
reclassify any of its capital stock or issue or authorize
the issuance of any other securities in respect of, in lieu
of or in substitution for shares of its capital stock or
(iii) purchase, redeem or otherwise acquire any shares of
capital stock of the Company or any of its subsidiaries or
any other securities thereof or any rights, warrants or
options to acquire any such shares or other securities
(except for the cashless exercise of the Warrant);
(b) authorize for issuance, issue, deliver, sell or
agree or commit to issue, sell or deliver (whether through
the issuance or granting of options, warrants, commitments,
subscriptions, rights to purchase or otherwise), pledge or
otherwise encumber any shares of its capital stock or the
capital stock of any of its subsidiaries, any other voting
securities or any securities convertible into, or any
rights, warrants or options to acquire, any such shares,
voting securities or convertible securities or any other
securities or equity equivalents (including without
limitation stock appreciation rights) (other than sales of
capital stock of any wholly owned subsidiary of the Company
to the Company or another wholly owned subsidiary of the
Company); provided, however, and not in limitation of the
foregoing, no additional equity securities or rights to
<PAGE>
Exhibit 1 Page 43 of 131 Pages
purchase equity securities will be granted after the date
hereof;
(c) except to the extent required under existing Plans
or Employment Arrangements as in effect on the date of this
Agreement, (i) increase the compensation or fringe benefits
of any of its directors, officers or employees, except for
increases in salary or wages of employees of the Company or
its subsidiaries who are not officers of the Company in the
ordinary course of business in accordance with past
practice, or (ii) grant any severance or termination pay not
currently required to be paid under existing Plans, or (iii)
enter into any Employment Arrangement with any present or
former director level or other equivalent or more senior
officer or employee, or, other than in the ordinary course
of business consistent with past practice, any other
employee of the Company or any of its subsidiaries, or (iv)
establish, adopt, enter into or amend or terminate any Plan
or Employment Arrangement or other plan, agreement, trust,
fund, policy or arrangement for the benefit of any
directors, officers or employees except to the extent
amendment or termination is necessary or desirable to
effectuate the provisions herein and the purposes of
Section 2.3;
(d) amend its Certificate of Incorporation, By-Laws or
other comparable charter or organizational documents or
alter through merger, liquidation, reorganization,
restructuring or in any other fashion the corporate
structure or ownership of any subsidiary of the Company;
(e) acquire or agree to acquire (i) by merging or
consolidating with, or by purchasing a substantial portion
of the stock or assets of, or by any other manner, any
business or any corporation, partnership, joint venture,
association or other business organization or division
thereof or (ii) any assets that are material, individually
or in the aggregate, to the Company and its subsidiaries
taken as a whole, except purchases of cellular telephone
minutes in the ordinary course of business consistent with
past practice and except for the exercise of the CTS
Warrant;
(f) sell, lease, license, mortgage or otherwise
encumber or subject to any lien or otherwise dispose of any
of its properties or assets, except sales of (i) cellular
telephone minutes and cellular telephone equipment in the
ordinary course of business consistent with past practice,
(ii) sales of accounts receivable in the ordinary course of
business consistent with past practice, and (iii) in
connection with capital expenditures permitted to be
<PAGE>
Exhibit 1 Page 44 of 131 Pages
expended by the Company pursuant to Section 4.1(h);
(g) (i) except as set forth on Schedule 4.1(g) hereto,
incur any indebtedness for borrowed money or guarantee any
such indebtedness of another person (other than guarantees
by the Company in favor of any of its wholly owned
subsidiaries or by any of its subsidiaries in favor of the
Company), issue or sell any debt securities or warrants or
other rights to acquire any debt securities of the Company
or any of its subsidiaries, guarantee any debt securities of
another person, enter into any "keep well" or other
agreement to maintain any financial statement condition of
another person or enter into any arrangement having the
economic effect of any of the foregoing, except for
short-term borrowings incurred in the ordinary course of
business consistent with past practice or (ii) make any
loans, advances or capital contributions to, or investments
in, any other person, other than to the Company or any
direct or indirect wholly owned subsidiary of the Company,
except for the exercise of the CTS Warrant;
(h) expend funds for capital expenditures other than
in accordance with the Company's current capital expenditure
plans (which plans shall have been disclosed in writing to
the Parent on or prior to the date hereof) or replace or
modify the Company's billing system, whether or not such
replacement or modification was included in current capital
expenditure plans and/or disclosed in writing to the Parent;
(i) enter into or amend, supplement or otherwise
modify any agreement, arrangement or understanding other
than in the ordinary course of business, consistent with
past practice, except that the Warrant may be amended to
provide that in the event of a cashless exercise of the
Warrant upon a Change of Control (as defined therein), in
addition to receiving the excess of the Merger Consideration
over the exercise price, Mr. Adelson will be entitled to
receive the number of shares of CTS Common Stock which he
would have received in the Spin-Off Distribution had he
exercised the Warrant in full prior to the Spin-Off
Distribution Record Date;
(j) (A) waive, release, grant or transfer any rights,
or extend or modify or change in any material respect any
services agreement or other arrangement or understanding
with CTS or any subsidiary of CTS, or enter into any
additional agreement, arrangement or understanding with CTS
or any subsidiary of CTS, in each case, except for
extensions up to the date of the Effective Time of any
existing agreement which would otherwise expire before then,
or (B) waive, release, grant or transfer any rights of
<PAGE>
Exhibit 1 Page 45 of 131 Pages
value, or extend or modify or change in any material respect
any existing, or enter into any additional, license, lease,
contract or other document, other than in the ordinary
course of business consistent with past practice;
(k) adopt a plan of complete or partial liquidation or
resolutions providing for or authorizing such a liquidation
or a dissolution, merger, consolidation, restructuring,
recapitalization or reorganization;
(l) recognize any labor union (unless legally required
to do so) or enter into or amend any collective bargaining
agreement;
(m) change any accounting principle used by it, unless
required by the SEC or the Financial Accounting Standards
Board;
(n) make any Tax election or settle or compromise any
income Tax liability or file any federal income tax return
prior to the last day (including extensions) prescribed by
law, in the case of any of the foregoing, material to the
business, financial condition or results of operations of
the Company and its subsidiaries taken as a whole;
(o) settle or compromise any litigation in which the
Company or any subsidiary is a defendant (whether or not
commenced prior to the date of this Agreement) or settle,
pay or compromise any claims not required to be paid, which
payments are individually in an amount in excess of $500,000
and in the aggregate in an amount in excess of $1,000,000;
and
(p) authorize any of, or commit or agree to take any
of, the foregoing actions.
SECTION 4.2 Conduct of Business of the Purchaser. The
Purchaser has not engaged, and during the period from the date of
this Agreement to the Effective Time, the Purchaser shall not
engage, in any activities of any nature except as provided in, or
in connection with the transactions contemplated by, this
Agreement.
SECTION 4.3 Preparation of Proxy Statement. The
Company shall promptly prepare and file with the SEC a
preliminary proxy statement relating to the Merger and this
Agreement and use its best efforts (x) to obtain and furnish the
information required to be included by the SEC in the Proxy
Statement (as hereinafter defined) and, after consultation with
the Parent, to respond promptly to any comments made by the SEC
with respect to the preliminary proxy statement and cause a
<PAGE>
Exhibit 1 Page 46 of 131 Pages
definitive proxy statement (the "Proxy Statement") to be mailed
to its stockholders and (y) to obtain the necessary approvals of
the Merger and this Agreement by its stockholders.
SECTION 4.4 Access to Information; Confidentiality.
(a) From the date hereof to the Effective Time, the Company
shall, and shall cause its subsidiaries, officers, directors,
employees, auditors and other agents to, afford the officers,
employees, auditors and other agents of the
Parent, complete access at all reasonable times to its
officers, employees, agents, properties, offices, plants and
other facilities and to all books and records, and shall furnish
the Parent and such other persons with all financial, operating and
other data and information as the Parent, through its officers,
employees or agents may from time to time request.
(b) Each of the Parent and the Purchaser will hold and
will cause its officers, employees, auditors and other agents to
hold in confidence, unless compelled to disclose by judicial or
administrative process or by other requirements of law or
regulation (in which event the Parent shall give prompt notice
thereof to the Company), all documents and information concerning
the Company and its subsidiaries furnished to the Parent or the
Purchaser in connection with the transactions contemplated in
this Agreement (except to the extent that such information can be
shown to have been (i) previously known by the Parent or the
Purchaser from sources other than the Company, or its directors,
officers, auditors or other agents, (ii) in the public domain
through no fault of the Parent or the Purchaser or (iii) lawfully
acquired by the Parent or the Purchaser on a non-confidential
basis from sources who are not known by the Parent or the
Purchaser to be bound by a confidentiality agreement or otherwise
prohibited from transmitting the information to the Parent or the
Purchaser by a contractual, legal or fiduciary obligation) and
will not release or disclose such information to any other
person, unless compelled to disclose by judicial or
administrative process or by other requirements of law or
regulation (in which event the Parent shall give prompt notice
thereof to the Company), except its auditors and other advisors
in connection with this Agreement who need to know such
information. If the transactions contemplated by this Agreement
are not consummated, such confidence shall be maintained for a
period of two years from the date hereof and, if requested by or
on behalf of the Company, the Parent and the Purchaser will, and
will cause their auditors and other agents to, return to the
Company or destroy all copies of written information furnished by
the Company to the Parent and the Purchaser or their agents,
representatives or advisors. It is understood that the Parent
and the Purchaser shall be deemed to have satisfied their
obligation to hold such information confidential in accordance
<PAGE>
Exhibit 1 Page 47 of 131 Pages
herewith if they exercise the same care as they take to preserve
confidentiality for their own similar information. The
provisions of this Section 4.4(b) replace and supersede the
obligations of the Parent set forth in any confidentiality
agreement previously entered into between the Parent and the
Company.
(c) No investigation pursuant to this Section 4.4
shall affect any representations or warranties of the parties
herein or the conditions to the obligations of the parties
hereto.
SECTION 4.5 No Solicitation. Neither the Company nor
any of its subsidiaries shall, nor shall the Company or any of
its subsidiaries authorize or permit any of its officers,
directors or employees or any investment banker, financial
advisor, attorney, accountant or other representative retained by
it or any of its subsidiaries to solicit, encourage (including by
way of furnishing information or assistance), or take any other
action to facilitate, any inquiries or the making of any proposal
which constitutes, or may reasonably be expected to lead to, any
Transaction Proposal (as defined below), or enter into or
maintain or continue discussions or negotiate with any person in
furtherance of such inquiries or to obtain a Transaction
Proposal, or agree to or endorse any Transaction Proposal, and
the Company shall notify the Parent orally (within one business
day) and in writing (as promptly as practicable), in reasonable
detail, as to any inquiries and proposals which it or any of its
subsidiaries or any of their respective representatives or agents
may receive; provided, however, that (i) the Company may furnish
or cause to be furnished information concerning the Company and
its businesses, properties or assets to a third party, and (ii)
the Company may engage in discussions or negotiations with a
third party if, and only to the extent that (A) the Board of
Directors of the Company shall conclude in good faith on the
basis of advice from outside counsel that such action is required
in order for the Board of Directors of the Company to satisfy its
fiduciary obligations under applicable law and (B) prior to
taking any of the foregoing actions referred to in clauses (i) or
(ii) above, the Company provides reasonable notice (no less than
one business day) to and keeps the Parent informed, on a current
basis, with respect to such action and obtains a confidentiality
agreement from the third party substantially the same as that
obtained from the Parent prior to delivering to any such person
any non-public information. As used herein, the term
"Transaction Proposal" means (x) any acquisition or purchase of a
substantial amount of assets of, or any equity interest in, the
Company or any of its subsidiaries or any tender offer (including
a self tender offer) or exchange offer, merger, consolidation,
business combination, sale of substantially all assets, sale of
securities, recapitalization, liquidation, dissolution or similar
<PAGE>
Exhibit 1 Page 48 of 131 Pages
transaction involving the Company or any of its subsidiaries
(other than the transactions contemplated hereby) or any other
transaction the consummation of which would or could reasonably
be expected to impede, interfere with, prevent or materially
delay the consummation of the Merger or the other transactions
contemplated hereby or (y) any proposal, plan or intention to do
any of the foregoing either publicly announced or communicated to
the Company or any agreement to engage in any of the foregoing.
The Company will immediately cease and cause to be terminated any
existing activities, discussions or negotiations with any parties
conducted heretofore with respect to any of the foregoing. This
section shall not prohibit accurate disclosure by the Company in
any document that is required to be filed by the Company with the
SEC.
SECTION 4.6 Employee Benefits Matters. (a) The
Parent agrees that, during the period commencing at the Effective
Time and ending on December 31, 1995, the employees of the
Company and its subsidiaries (other than those employees covered
by a collective bargaining agreement) will continue to be
provided with employee benefit plans which in the aggregate are
substantially comparable to those currently provided by the
Company and its subsidiaries to such employees (other than plans
involving or related to the securities of the Company). Subject
to the foregoing, nothing herein shall (i) prevent the amendment
or termination of any such plan, program or arrangement, (ii)
interfere with the Surviving Corporation's right or obligation to
take any action or refrain from taking any action which the
Company could take or refrain from taking prior to the Effective
Time. In addition, in administering such plans, programs or
arrangements, the Parent may cause a reduction of benefits under
any such plans, programs or arrangements to the extent necessary
to avoid duplication of benefits with respect to the same covered
matter or years of service.
SECTION 4.7 Directors' and Officers' Indemnification
and Insurance. (a) The By-Laws of the Surviving Corporation
shall contain provisions no less favorable with respect to
indemnification than are set forth in the By-laws of the Company,
which provisions shall not be amended, repealed or otherwise
modified for a period of six years from the Effective Time in any
manner that would adversely affect the rights thereunder of
individuals who at the Effective Time were directors, officers,
agents or employees of the Company or otherwise entitled to
indemnification pursuant to the Company's By-Laws. In the event
that the Surviving Corporation transfers all or substantially all
of its operations, the Parent shall guarantee, or shall cause MCI
Telecommunications, Inc. to guarantee, the obligations of the
Surviving Corporation under this Section 4.7(a).
(b) The Parent shall cause to be maintained in effect
<PAGE>
Exhibit 1 Page 49 of 131 Pages
for six years from the Effective Time the current policies of the
directors' and officers' liability insurance maintained by the
Company (provided that the Parent may substitute therefor
policies of at least the same coverage containing terms and
conditions which are not materially less advantageous) with
respect to matters occurring prior to the Effective Time to the
extent available; provided, however, that in no event shall the
Parent or the Surviving Corporation be required to expend more
than an amount per year equal to 150% of current annual premiums
paid by the Company to maintain or procure insurance coverage
pursuant hereto.
SECTION 4.8 Further Action; Reasonable Best Efforts.
Upon the terms and subject to the conditions hereof, each of the
parties hereto shall use its reasonable best efforts to take, or
cause to be taken, all appropriate action, and to do or cause to
be done, all things necessary, proper or advisable under
applicable laws and regulations to consummate and make effective
the transactions contemplated by this Agreement, including but
not limited to (i) cooperation in the preparation and filing of
the Proxy Statement, any required filings under the HSR Act and
other Regulatory Requirements, and any amendments to any thereof
and (ii) using its reasonable best efforts to make all required
regulatory filings and applications and to obtain all Licenses,
permits, consents, approvals, authorizations, qualifications and
orders of governmental authorities and parties to contracts with
the Company and its subsidiaries as are necessary for the
consummation of the transactions contemplated by this Agreement
and to fulfill the conditions to the Merger. In case at any time
after the Effective Time any further action is necessary or
desirable to carry out the purposes of this Agreement, the proper
officers and directors of each party to this Agreement shall use
their reasonable best efforts to take all such necessary action.
In addition, the Company shall cause senior management of the
Company and its subsidiaries to cooperate in good faith with
representatives of the Parent in identifying transition issues
and formulating plans and strategies to address any such issues.
SECTION 4.9 Public Announcements. The Parent and the
Company shall consult with each other before issuing any press
release or otherwise making any public statements with respect to
the Merger and shall not issue any such press release or make any
such public statement prior to such consultation, except as may
be required by law or any listing agreement with its securities
exchange or quotation system.
SECTION 4.10 Taxes. Any liability with respect to
taxes specified in Section 4.14 hereof that are incurred in
connection with the Merger shall be borne by the Company and
expressly shall not be a liability of the stockholders of the
<PAGE>
Exhibit 1 Page 50 of 131 Pages
Company.
SECTION 4.11 Spin-Off Distribution. (a) After the
Proxy Statement has been mailed to the Stockholders of the
Company but prior to the tenth day before the date of the
Stockholders' Meeting, the Board of Directors of the Company
shall declare a distribution (the "Spin-Off Distribution") of CTS
Common Stock to the holders of Company Common Stock, which
distribution shall be payable, contingent on the satisfaction or
waiver of the conditions hereto, other than the conditions set
forth in Section 5.2(d), in an amount per share of Company Common
Stock as follows, in each case subject to Section 4.11(b): (i)
if the average closing market price of CTS Common Stock on each
of the three trading-days ending on the Spin-Off Distribution
Record Date (as defined below) (the "Distribution Price") is
equal to or less than $22.00 per share, then each share of
Company Common Stock shall be entitled to receive that number of
shares of CTS Common Stock equal to the quotient obtained by
dividing 3,980,000 by the sum of the then outstanding shares of
Company Common Stock and the shares of Company Common Stock then
reserved for issuance upon exercise of Options, the Warrant and
the warrant held by Jay Brown, and (ii) if the Distribution Price
per share is more than $22.00 per share, then each share of
Company Common Stock shall be entitled to receive that number of
shares of CTS Common Stock equal to the quotient obtained by
dividing (A) (x) the number of shares which, based on the
Distribution Price, have an aggregate value equal to the product
of $22.00 times 3,980,000, plus (y) the number of shares which,
based on the Distribution Price, have an aggregate value equal to
the product of 60% of the difference between the Distribution
Price and $22.00 times 3,980,000 by (B) the sum of the then
outstanding shares of Company Common Stock and the shares of
Company Common Stock then reserved for issuance upon exercise of
Options, the Warrant and the warrant held by Jay Brown. In the
event of any stock split, combination, reclassification, share
dividend or other event similarly altering or affecting the value
of CTS Common Stock, the foregoing shall be adjusted to the
extent deemed appropriate by the Board of Directors of the
Company, and subject to the reasonable approval of the Parent, to
carry out fully the purposes and intents hereof. The resolutions
of the Board of Directors declaring the Spin-Off Distributions
and setting forth the terms and conditions described above shall
in form and substance be reasonably satisfactory to the Parent.
(b) In no event will any fractional shares be
delivered in the Spin-Off Distribution, and in lieu of fractional
shares, the Company shall deliver cash to each holder who would
otherwise be entitled to a fractional share in an amount equal to
the Distribution Price times such fraction, rounded to the
nearest $0.01.
<PAGE>
Exhibit 1 Page 51 of 131 Pages
(c) The Company agrees that until the Spin-Off
Distribution has occurred, the resolutions of the Board of
Directors of the Company pursuant to which the Spin-Off
Distribution is to be declared shall not be terminated, modified,
amended or supplemented without the consent of the Parent if the
Parent would be adversely affected thereby.
(d) The Spin-Off Distribution shall occur after the
Merger has been approved by the stockholders of the Company and
the satisfaction of any other conditions set forth herein (other
than as set forth in Section 5.2(d)) and immediately prior to the
Effective Time (the "Spin-Off Distribution Payment Date") and be
payable to holders of record of Company Common Stock at the close
of business on the date immediately preceding the Spin-Off
Distribution Payment Date (the "Spin-Off Record Date").
(e) The Company shall promptly prepare and submit a
no-action request letter to the SEC requesting the Division of
Corporate Finance of the SEC to confirm that (i) it would not
recommend enforcement action to the SEC if the Spin-Off
Distribution were effected without registration under the
Securities Act, (ii) the shares of CTS Common Stock received in
the distribution by stockholders of the Company would not be
"restricted securities" within the meaning of Rule 144(a)(3) of
the Securities Act, and (iii) such other matters as are
customarily requested in effecting distributions of shares in
similar circumstances. The Company shall exercise its best
efforts to obtain a no-action letter confirming the foregoing
and, unless such letter includes terms and conditions that are
not customary and that are not reasonably satisfactory to the
Company, to comply with any conditions imposed by the Division of
Corporate Finance in connection therewith. Prior to submitting
any such request, the Company will provide counsel to the
Purchaser with the opportunity to review and comment thereon, and
the Company will cooperate in good faith in responding to any
such comments. The Company will promptly furnish to the Parent
and its counsel copies of all correspondence with the SEC in
connection with the Spin-Off Distribution.
(f) In the event that the Division of Corporate
Finance declines to issue a no-action letter in response to the
request described in Section 4.11(e) above, or issues a letter
with other than customary terms and conditions which are not
reasonably satisfactory to the Parent or the Company, so that the
conditions set forth in Sections 5.2(d) and 5.3(c) below cannot
be satisfied, then, at the Parent's request, the Company will use
its best efforts to enter into a registration rights agreement
with CTS on terms and conditions satisfactory to Parent pursuant
to which CTS will promptly prepare and file a registration
statement (the "CTS Registration Statement") with respect to the
CTS Common Stock with the SEC and exercise best efforts to cause
<PAGE>
Exhibit 1 Page 52 of 131 Pages
such registration statement to be declared effective by the SEC
as promptly as practicable, and the Company will use its best
efforts to cause the prospectus contained within the CTS
Registration Statement to be mailed to the Company's stockholders
as promptly as practicable after the CTS Registration Statement
is declared effective. The Company hereby covenants that the CTS
Registration Statement, at the time it is declared effective, and
any amendments or supplements thereto, shall not contain any
untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary in order to make
the statements therein, in the light of the circumstances in
which they were made, not misleading, and shall comply as to form
in all material respects with the requirements of the Securities
Act and the rules and regulations promulgated thereunder. Any
registration rights agreement with CTS will require that, prior
to filing the CTS Registration Statement or any amendment
thereto, CTS will provide the Purchaser and its counsel the
opportunity to review and comment thereon, and CTS will cooperate
in good faith in responding to any such comments. Any
registration rights agreement with CTS will also provide the
Purchaser and its legal, financial and other advisors the
opportunity to conduct such legal, financial and business due
diligence with respect to CTS as they shall reasonably request
and that CTS will use its best efforts to cause to be delivered
to the Company a letter of Ernst & Young LLP, the independent
auditors of CTS, dated a date within two business days of the
date on which the registration statement shall become effective
and addressed to the Company, in form and substance reasonably
satisfactory to the Parent and customary in scope and substance
for letters delivered by independent accountants in connection
with registration statements similar to the registration
statement filed in connection with the CTS Common Stock.
SECTION 4.12 Certain Agreements. Neither the Company
nor any subsidiary will waive any provision of any
confidentiality or standstill or similar agreement to which it is
a party without the prior written consent of the Parent, unless
the Board of Directors of the Company or such subsidiary
concludes in good faith that waiving such provision is necessary
or appropriate in order for the Board of Directors of the Company
to act in a manner which is consistent with its fiduciary
obligations under applicable law.
SECTION 4.13 CTS Warrant. The Company shall timely
exercise the CTS Warrant to acquire shares of CTS Common Stock in
order to include the shares deliverable upon any such exercise in
the Spin-Off Distribution.
SECTION 4.14 Conveyance Taxes. The Parent and the
Company shall cooperate in the preparation, execution and filing
of all returns, questionnaires, applications, or other documents
<PAGE>
Exhibit 1 Page 53 of 131 Pages
regarding any real property transfer gains, sales, use, transfer,
value added, stock transfer and stamp taxes, any transfer,
recording, registration and other fees, and any similar taxes
that become payable in connection with the transactions
contemplated hereby that are required or permitted to be filed on
or before the Effective Time.
ARTICLE V
CONDITIONS OF MERGER
SECTION 5.1 Conditions to Obligation of Each Party to
Effect the Merger. The respective obligations of each party to
effect the Merger shall be subject to the satisfaction at or
prior to the Effective Time of the following conditions:
(a) Stockholder Approval. This Agreement shall have
been approved and adopted by the affirmative vote of the holders
of a majority of the outstanding shares of Company Common Stock
entitled to vote thereon.
(b) Other Approvals. Other than the filing
contemplated by Section 1.3, all consents, approvals,
authorizations or permits of, actions by, or filings with or
notifications to, and all expirations of waiting periods imposed
by, any Governmental Entity (all the foregoing, "Consents") which
are necessary for the consummation of the Merger, other than
immaterial Consents the failure to obtain which would have no
material adverse effect on the consummation of the Merger, shall
have been filed, occurred or been obtained (all such permits,
approvals, filings and consents and the lapse of all such waiting
periods being referred to as the "Requisite Regulatory
Approvals"), and all such Requisite Regulatory Approvals shall be
in full force and effect.
(c) No Injunctions or Restraints; Illegality. No
temporary restraining order, preliminary or permanent injunction
or other order issued by any court of competent jurisdiction or
other legal restraint or prohibition preventing the consummation
of the Merger shall be in effect, nor shall any proceeding by any
Governmental Entity seeking any of the foregoing be pending.
There shall not be any action taken, or any statute, rule,
regulation or order enacted, entered, enforced or deemed
applicable to the Merger, which makes the consummation of the
Merger illegal.
SECTION 5.2 Conditions to Obligations of Parent and
Purchaser. The obligations of the Parent and the Purchaser to
effect the Merger are subject to the satisfaction of the
following conditions unless waived by the Parent and the
Purchaser:
<PAGE>
Exhibit 1 Page 54 of 131 Pages
(a) Representations and Warranties. The
representations and warranties of the Company set forth in this
Agreement shall be true and correct in all material respects as
of the date of this Agreement and (except to the extent such
representations and warranties speak as of an earlier date) as of
the Closing Date as though made on and as of the Closing Date,
except as otherwise contemplated by this Agreement, and the
Parent shall have received a certificate signed on behalf of the
Company by the Chairman of the Board and Chief Executive Officer
of the Company, and by the Chief Financial Officer of the Company
to such effect.
(b) Performance of Obligations of the Company. The
Company shall have performed in all material respects all
obligations required to be performed by it under this Agreement
at or prior to the Closing Date, and the Parent shall have
received a certificate signed on behalf of the Company by the
Chairman of the Board and Chief Executive Officer of the Company,
and by the Chief Financial Officer of the Company to such effect.
(c) Burdensome Condition. There shall not be any
action taken, or any statute, rule, regulation or order enacted,
entered, enforced or deemed applicable to the Merger, by any
federal or state Governmental Entity which, (i) in connection
with the grant of a Requisite Regulatory Approval, imposes any
condition or restriction upon the Parent or its subsidiaries
which would require the Parent or any subsidiary, including the
Company or any of its subsidiaries after the Merger, to dispose
of any assets with a value in excess of $15 million or which
would so materially adversely impact the economic or business
benefits of the transactions contemplated by this Agreement as to
render inadvisable the consummation of the Merger, provided that
the parties shall have contested in good faith the imposition of
any such condition or restriction or (ii) in connection with the
grant of a Requisite Regulatory Approval or otherwise, would be
reasonably likely to result in a Material Adverse Effect with
respect to the Company or any subsidiary thereof.
(d) Spin-Off Distribution. The Company shall have
received a no-action letter from the Division of Corporate
Finance of the SEC granting the relief requested in the request
letter contemplated by Section 4.11 above and subject only to
such customary terms and conditions as may be reasonably
satisfactory to the Parent or a CTS Registration Statement shall
have been declared effective by the SEC and no stop order shall
have been issued. The Board of Directors of the Company shall
have set the Spin-Off Record Date and paid the Spin-Off
Distribution as contemplated hereby and in compliance with the
terms and conditions of the no-action letter so received.
(e) Parent Board Approval. The Board of Directors of
<PAGE>
Exhibit 1 Page 55 of 131 Pages
Parent shall have duly authorized and approved this Agreement,
the Merger and the other transactions contemplated hereby.
(f) Dissenters' Rights. No more than 7% of the shares
of Company Common Stock shall be, or have the right to become,
Dissenting Shares.
SECTION 5.3 Conditions to Obligations of the Company.
The obligation of the Company to effect the Merger is subject to
the satisfaction of the following unless waived by the Company:
(a) Representations and Warranties. The
representations and warranties of the Parent and the Purchaser
set forth in this Agreement shall be true and correct in all
material respects as of the date of this Agreement and (except to
the extent such representations and warranties speak as of an
earlier date) as of the Closing Date as though made on and as of
the Closing Date, except as otherwise contemplated by this
Agreement, and the Company shall have received a certificate
signed on behalf of the Parent by the Chief Financial Officer of
the Parent to such effect.
(b) Performance of Obligations of the Parent and the
Purchaser. The Parent and the Purchaser shall have performed in
all material respects all obligations required to be performed by
them under this Agreement at or prior to the Closing Date, and
the Company shall have received a certificate signed on behalf of
the Parent by the President of the Parent to such effect.
(c) Spin-Off Distribution. The Company shall have
received a no-action letter from the Division of Corporate
Finance of the SEC granting the relief requested in the request
letter contemplated by Section 4.11 above and subject only to
such customary terms and conditions as may be reasonably
satisfactory to the Company, or a CTS Registration Statement
shall have been declared effective by the SEC and no stop-order
shall have been issued.
ARTICLE VI
TERMINATION, AMENDMENT AND WAIVER
SECTION 6.1 Termination. This Agreement may be
terminated and the Merger contemplated hereby may be abandoned at
any time prior to the Effective Time, notwithstanding approval
thereof by the stockholders of the Company:
(a) by mutual written consent of the Parent, the
Purchaser and the Company; or
<PAGE>
Exhibit 1 Page 56 of 131 Pages
(b) by the Parent, upon a breach of any material
representation, warranty, covenant or agreement on the part of
the Company set forth in this Agreement, or if any such
representation or warranty of the Company shall have been or
become untrue, in each case such that the conditions set forth in
Section 5.2(a) or Section 5.2(b), as the case may be, would be
incapable of being satisfied (following notice and a reasonable
opportunity to cure) by October 21, 1995;
(c) by the Company, upon a breach of any material
representation, warranty, covenant or agreement on the part of
the Parent set forth in this Agreement, or if any such
representation or warranty of the Parent shall have been or
become untrue, in each case such that the conditions set forth in
Section 5.3(a) or Section 5.3(b), as the case may be, would be
incapable of being satisfied (following notice and a reasonable
opportunity to cure) by October 21, 1995;
(d) by either the Parent or the Company if, any
permanent injunction or action by any Governmental Entity
preventing the consummation of the Merger shall have become final
and nonappealable; provided that such right of termination shall
not be available to any party if such party shall have failed to
make reasonable efforts to prevent or contest the imposition of
such injunction or action and such failure materially contributed
to such imposition;
(e) by either the Parent or the Company if (other than
due to the willful failure of the party seeking to terminate this
Agreement to perform its obligations hereunder required to be
performed at or prior to the Effective Time) the Merger shall not
have been consummated on or prior to October 21, 1995, and in any
event if the Merger shall not have been consummated on or prior
to December 31, 1995;
(f) by the Parent, if the approval of the stockholders
of the Company of this Agreement and the Merger required for the
consummation of the Merger shall not have been obtained by reason
of the failure to obtain the required vote at a duly held meeting
of stockholders or at any adjournment thereof;
(g) by the Parent, if (i) the Board of Directors of
the Company shall have withdrawn, modified or changed its
approval or recommendation of this Agreement or the Merger in any
manner which is adverse to the Parent or the Purchaser or shall
have resolved to do the foregoing; or (ii) the Board of Directors
of the Company shall have approved or have recommended to the
stockholders of the Company a Transaction Proposal or shall have
resolved to do the foregoing; or (iii) a tender offer or exchange
offer for 15% or more of the outstanding shares of the Company
Common Stock is commenced (other than by the Parent or any of its
<PAGE>
Exhibit 1 Page 57 of 131 Pages
subsidiaries or affiliates), and the Board of Directors of the
Company recommends that the stockholders of the Company tender
their shares in such tender or exchange offer or otherwise fails
to recommend that such stockholders reject such tender offer or
exchange offer within ten business days of the commencement
thereof; or (iv) (A) any person (including the Company or any of
its subsidiaries or affiliates, but excluding Mr. Adelson) or
group (other than the Parent or any of its subsidiaries or
affiliates) shall have become the beneficial owner of either (x)
15% or more of the outstanding shares of the Company Common Stock
and the Company has directly or indirectly encouraged or assisted
such acquisition (including, without limitation, taking any
action under Section 203 of the DGCL) or (y) 25% or more of the
outstanding shares of the Company Common Stock, or (B) if Mr.
Adelson becomes the beneficial owner of shares of Company Common
Stock in addition to those owned on the date hereof; or
(h) by the Company, if prior to the Stockholders'
Meeting the Board of Directors of the Company (i) shall fail to
make or shall withdraw or modify its recommendation of this
Agreement or the Merger if there shall exist at such time a
tender offer or exchange offer or a written, bona fide proposal
by a third party to acquire the Company pursuant to a merger,
consolidation, share exchange, business combination, tender or
exchange offer or other similar transaction or (ii) recommends to
the Company's stockholders approval or acceptance of any such
transaction, in each case if, and only to the extent that, the
Board of Directors of the Company, after consultation with and
based upon the advice of independent legal counsel, determines in
good faith that such action is required for the Board of
Directors of the Company to comply with its fiduciary duties to
stockholders under applicable law;
(i) by the Parent if the SEC has declined to issue a
favorable no-action letter, or has issued a no-action letter that
does not satisfy the requirements of Section 4.11(e) and the
Company has not entered into a registration rights agreement with
CTS that satisfies the requirements of Section 4.11(f) within 15
days after the SEC declines to issue a no action letter or issues
a no action letter that does not satisfy the requirements of
Section 4.11(e); or
(j) by the Parent or the Company if the condition
precedent set forth in Section 5.2(e) shall not have been
satisfied on or prior to June 9, 1995.
SECTION 6.2 Effect of Termination. In the event of
the termination of this Agreement pursuant to Section 6.1, this
Agreement shall forthwith become void and there shall be no
liability on the part of any party hereto except as set forth in
Section 6.3, Section 4.4(b) and Section 7.1; provided, however,
<PAGE>
Exhibit 1 Page 58 of 131 Pages
that nothing herein shall relieve any party from liability for
any breach hereof.
SECTION 6.3 Fees and Expenses. (a) The Company
agrees that if this Agreement shall be terminated pursuant to:
(i) Section 6.1(b) and (x) such termination is the
result of wilful breach by the Company of any material
covenant, agreement, representation or warranty contained
herein and (y) at any time during the period commencing on
the date hereof and ending twelve months after the date of
termination of this Agreement, a Business Combination (as
defined in Section 6.3(e) below) involving the Company shall
have occurred or the Company shall have entered into a
definitive agreement providing for such a Business
Combination;
(ii) Section 6.1(e) and (x) there shall exist a
Transaction Proposal with respect to the Company, and (y) at
any time during the period commencing on the date hereof and
ending twelve months after the date of termination of this
Agreement, a Business Combination involving the Company
shall have occurred or the Company shall have entered into a
definitive agreement providing for a Business Combination;
(iii) Section 6.1(f) because the Agreement and the
Merger shall fail to receive the requisite vote for approval
and adoption by the stockholders of the Company at a meeting
of stockholders of the Company called to vote thereon and at
the time of such meeting (x) there shall exist a Transaction
Proposal with respect to the Company or (y) any event
specified in Section 6.1(g)(iv) shall have occurred;
(iv) Section 6.1(g)(i) and at the time of the
withdrawal, modification or change (or resolution to do so)
of its recommendation by the Board of Directors of the
Company, there shall exist a Transaction Proposal with
respect to the Company or any event specified in
Section 6.1(g)(iv) shall have occurred; or
(v) Section 6.1(g)(iv) and at any time during the
period commencing on the date hereof and ending twelve
months after the date of termination of this Agreement,
either (A) a Business Combination specified in clause (i) or
(ii) of the definition thereof shall have occurred or the
Company shall have entered into a definitive agreement
providing for such a Business Combination or (B) any person
or group shall acquire beneficial ownership of 50% or more
of the outstanding Company Common Stock; or
(vi) Sections 6.1(g)(ii) or (iii), or Section
<PAGE>
Exhibit 1 Page 59 of 131 Pages
6.1(h); then the Company shall pay to the Parent an amount
equal to (x) $7,500,000, plus (y) all out-of-pocket fees and
expenses (including, without limitation, reasonable fees and
disbursements payable to any investment bankers, counsel to
the Parent, counsel to such investment bankers, and
accountants) incurred by the Parent or on its behalf in
connection with the analysis, negotiation, preparation,
execution and performance of this Agreement, and the Voting
Agreements and the consummation of the transactions
contemplated hereby and thereby ("Expenses") up to
$1,500,000.
(b) The Company agrees that if this Agreement shall be
terminated pursuant to Section 6.1(f) because the Agreement and
the Merger shall fail to receive the requisite vote for approval
and adoption by the stockholders of the Company at a meeting of
stockholders of the Company called to vote thereon, or pursuant
to Section 6.1(b), Section 6.1(g)(i) or Section 6.1(i), then, in
any such event, the Company shall pay to the Parent an amount
equal to the Parent's Expenses, provided that the Company shall
not be obligated to make any payment pursuant to this Section
6.3(b) if the Company shall be obligated to make a payment to the
Parent pursuant to Section 6.3(a).
(c) The Parent agrees that if this Agreement shall be
terminated pursuant to Section 6.1(c) or 6.1(j), then the Parent
shall pay to the Company an amount equal to (x) $1,500,000 plus
(y) all out-of-pocket fees and expenses (including, without
limitation, reasonable fees and disbursements payable to any
investment bankers, counsel to the Company, counsel to such
investment bankers, and accountants) incurred by the Company or
on its behalf in connection with the analysis, negotiation,
preparation, execution and performance of this Agreement and the
consummation of the transactions contemplated hereby, up to
$1,500,000.
(d) Any payment required to be made pursuant to
Section 6.3(a) through Section 6.3(c), inclusive, shall be made
contemporaneously with the termination of this Agreement and
shall be made by wire transfer of immediately available funds to
an account designated by the recipient of such payment, and
termination by any party required to make such payment
contemporaneously therewith shall not be effective until such
payment shall have been made pursuant hereto, except that any
payment to be made as the result of an event described in Section
6.3(a)(i), 6.3(a)(ii) or 6.3(a)(v) shall be made as promptly as
practicable but not later than five business days after the
occurrence of the Business Combination or the execution of the
definitive agreement providing for a Business Combination. Any
payment made pursuant to Sections 6.3(a) through 6.3(c),
inclusive, shall not preclude the recipient of such payment from
<PAGE>
Exhibit 1 Page 60 of 131 Pages
seeking monetary damages from the other party as described in of
Section 6.2.
(e) For purposes of this Section 6.3, the term
"Business Combination" shall mean any of the following involving
the Company: (i) any merger, consolidation, share exchange,
business combination or similar transaction; (ii) any sale,
lease, exchange, transfer or other disposition of 15% or more of
the assets of the Company and its subsidiaries, taken as a whole,
in a single transaction or series of related transactions; or
(iii)(A) any person (including the Company or any of its
subsidiaries or affiliates, but excluding Mr. Adelson) or any
group (other than the Parent or any of its subsidiaries or
affiliates) becoming the beneficial owner of either (x) 15% or
more of the outstanding shares of the Company Common Stock and
the Company has directly or indirectly encouraged or assisted
such acquisition (including, without limitation, taking any
action under Section 203 of the DGCL) or (y) 25% or more of the
outstanding shares of the Company Common Stock, or (B) Mr.
Adelson becoming the beneficial owner of shares of Company Common
Stock in addition to those owned on the date hereof.
(f) Except as specifically provided in this Section
6.3, each party shall bear its own expenses in connection with
this Agreement and the transactions contemplated hereby.
SECTION 6.4 Amendment. This Agreement may be amended
by the parties hereto by action taken by or on behalf of the
Parent and the respective Boards of Directors of the Purchaser
and the Company at any time prior to the Effective Time;
provided, however, that, after approval of the Merger by the
stockholders of the Company, no amendment may be made which would
reduce the amount or change the type of consideration into which
each share of Company Stock shall be converted upon consummation
of the Merger. This Agreement may not be amended except by an
instrument in writing signed by the parties hereto.
SECTION 6.5 Waiver. At any time prior to the
Effective Time, any party hereto may (a) extend the time for the
performance of any of the obligations or other acts of the other
parties hereto, (b) waive any inaccuracies in the representations
and warranties contained herein or in any document delivered
pursuant hereto and (c) waive compliance with any of the
agreements or conditions contained herein. Any such extension or
waiver shall be valid if set forth in an instrument in writing
signed by the party or parties to be bound thereby.
ARTICLE VII
GENERAL PROVISIONS
<PAGE>
Exhibit 1 Page 61 of 131 Pages
SECTION 7.1 Non-Survival of Representations,
Warranties and Agreements. The representations, warranties and
agreements in this Agreement shall terminate at the Effective
Time or upon the termination of this Agreement pursuant to
Section 6.1, except that those set forth in Section 4.4(b),
Section 6.3 and Article VII shall survive termination
indefinitely (in accordance with the terms of such provisions).
SECTION 7.2 Notices. All notices, requests, claims,
demands and other communications hereunder shall be in writing
and shall be given (and shall be deemed to have been duly given
upon receipt) by delivery in person, by cable, telecopy, telegram
or telex or by registered or certified mail (postage prepaid,
return receipt requested) to the respective parties at the
following addresses (or at such other address for a party as
shall be specified by like notice):
if to the Parent or the Purchaser:
MCI Communications Corporation
1801 Pennsylvania Avenue, N.W.
Washington, D.C. 20006
Attention: John R. Worthington, Esq.
with a copy to:
Simpson Thacher & Bartlett
425 Lexington Avenue
New York, New York 10017
Attention: Richard Capelouto, Esq.
if to the Company:
Nationwide Cellular Service, Inc.
20 East Sunrise Highway
Valley Stream, New York 11582
Attention: Stephen Katz
with a copy to:
Parker Chapin Flattau & Klimpl, LLP
1121 Avenue of the Americas
New York, New York 10036
Attention: Edward R. Mandell, Esq.
SECTION 7.3 Certain Definitions. For
purposes of this Agreement, the term:
(a) "affiliate" of a person means a person that
directly or indirectly, through one or more intermediaries,
<PAGE>
Exhibit 1 Page 62 of 131 Pages
controls, is controlled by, or is under common control with,
the first mentioned person;
(b) "beneficial owner" with respect to any shares of
Company Common Stock means a person who shall be deemed to
be the beneficial owner of such shares of Company Common
Stock (i) which such person or any of its affiliates or
associates beneficially owns, directly or indirectly, (ii)
which such person or any of its affiliates or associates (as
such term is defined in Rule 12b-2 of the Exchange Act) has,
directly or indirectly, (A) the right to acquire (whether
such right is exercisable immediately or subject only to the
passage of time), pursuant to any agreement, arrangement or
understanding or upon the exercise of consideration rights,
exchange rights, warrants or options, or otherwise, or (B)
the right to vote pursuant to any agreement, arrangement or
understanding or (iii) which are beneficially owned,
directly or indirectly, by any other persons with whom such
person or any of its affiliates or person with whom such
person or any of its affiliates or associates has any
agreement, arrangement or understanding for the purpose of
acquiring, holding, voting or disposing of any shares;
(c) "control" (including the terms "controlled by" and
"under common control with") means the possession, directly
or indirectly or as trustee or executor, of the power to
direct or cause the direction of the management policies of
a person, whether through the ownership of stock, as trustee
or executor, by contract or credit arrangement or otherwise;
(d) "generally accepted accounting principles" shall
mean the generally accepted accounting principles set forth
in the opinions and pronouncements of the Accounting
Principles Board of the American Institute of Certified
Public Accountants and statements and pronouncements of the
Financial Accounting Standards Board or in such other
statements by such other entity as may be approved by a
significant segment of the accounting profession in the
United States, in each case applied on a basis consistent
with the manner in which the audited financial statements
for the fiscal year of the Company ended December 31, 1994
were prepared;
(e) "knowledge" means knowledge after reasonable
inquiry;
(f) "person" means an individual, corporation,
partnership, association, trust, unincorporated
organization, other entity or group (as defined in Section
13(d)(3) of the Exchange Act); and
<PAGE>
Exhibit 1 Page 63 of 131 Pages
(g) "subsidiary" or "subsidiaries" of the Company, the
Surviving Corporation, the Parent or any other person means
any corporation, partnership, joint venture or other legal
entity of which the Company, the Surviving Corporation, the
Parent or such other person, as the case may be (either
alone or through or together with any other subsidiary),
owns, directly or indirectly, 50% or more of the stock or
other equity interests the holder of which is generally
entitled to vote for the election of the board of directors
or other governing body of such corporation or other legal
entity. For purposes of this Agreement, CTS shall not be
considered a subsidiary of the Company.
SECTION 7.4 Severability. If any term or other
provision of this Agreement is invalid, illegal or incapable of
being enforced by any rule of law, or public policy, all other
conditions and provisions of this Agreement shall nevertheless
remain in full force and effect so long as the economic or legal
substance of the transactions contemplated hereby is not affected
in any manner adverse to any party. Upon such determination that
any term or other provision is invalid, illegal or incapable of
being enforced, the parties hereto shall negotiate in good faith
to modify this Agreement so as to effect the original intent of
the parties as closely as possible in an acceptable manner to the
end that the transactions contemplated hereby are fulfilled to
the fullest extent possible.
SECTION 7.5 Entire Agreement; Assignment. This
Agreement constitutes the entire agreement among the parties with
respect to the subject matter hereof and supersedes all prior
agreements and undertakings, both written and oral, among the
parties, or any of them, with respect to the subject matter
hereof. This Agreement shall not be assigned by operation of law
or otherwise, except that the Parent and the Purchaser may assign
all or any of their respective rights and obligations hereunder
to any direct or indirect wholly owned subsidiary or subsidiaries
of the Parent, provided that no such assignment shall relieve the
assigning party of its obligations hereunder if such assignee
does not perform such obligations.
SECTION 7.6 Parties in Interest. This Agreement shall
be binding upon and inure solely to the benefit of each party
hereto, and nothing in this Agreement, express or implied, is
intended to or shall confer upon any other person any rights,
benefits or remedies of any nature whatsoever under or by reason
of this Agreement.
SECTION 7.7 Governing Law. This Agreement shall be
governed by, and construed in accordance with, the laws of the
State of Delaware, regardless of the laws that might otherwise
govern under applicable principles of conflicts of laws thereof.
<PAGE>
Exhibit 1 Page 64 of 131 Pages
SECTION 7.8 Headings. The descriptive headings
contained in this Agreement are included for convenience of
reference only and shall not affect in any way the meaning or
interpretation of this Agreement.
SECTION 7.9 Counterparts. This Agreement may be
executed in one or more counterparts, and by the different
parties hereto in separate counterparts, each of which when
executed shall be deemed to be an original but all of which taken
together shall constitute one and the same agreement.
IN WITNESS WHEREOF, the Parent, the Purchaser and the
Company have caused this Agreement to be executed as of the date
first written above by their respective officers thereunto duly
authorized.
MCI COMMUNICATIONS CORPORATION
By: /s/ Bert C. Roberts, Jr.
Name: Bert C. Roberts, Jr.
Title: Chairman
NTS ACQUISITION CORP.
By: /s/ Bert C. Roberts, Jr.
Name: Bert C. Roberts, Jr.
Title: Chairman
NATIONWIDE CELLULAR SERVICE, INC.
By: /s/ Stephen Katz
Name: Stephen Katz
Title: Chief Executive Officer
<PAGE>
Exhibit 1 Page 65 of 131 Pages
SCHEDULE A
Stockholders of the Company to Execute and
Deliver Voting Agreements
1. Stephen Katz
2. Jay Bernstein
3. Mel Steinberg
4. Larry Altman
5. Jerome Sanders
6. Joseph A. Gregori
<PAGE>
Exhibit 1 Page 66 of 131 Pages
ANNEX A
SUBSIDIARIES OF THE COMPANY AND OTHER ENTITIES
IN WHICH THE COMPANY HAS AN EQUITY INTEREST
Percentage Ownership
Name of Subsidiary by the Company
Nova Cellular Co. 100%
N.C.S Equipment Corporation 100%
Cellular Technical Services Company, Inc. 33.8%
Page Telecommunications Inc. (5% warrant)
Nationwide RSA Service, Inc. 100%
Portable Cellular Communications, Inc. 100%
Nationwide Cellular Service
of California, Inc. 100%
Nationwide Cellular Service
of New York, Inc. 100%
Nationwide Paging, Inc. 100%
Nationwide MDC, Inc. 100%
Nationwide Long Distance Service, Inc. 100%
Nationwide Switching Services, Inc. 100%
<PAGE>
Exhibit 1 Page 67 of 131 Pages
SCHEDULE 3.1(c)
1. Mr. Adelson has a warrant to purchase up to 850,000 shares
of the Company Common Stock at an exercise price of $11.00 per
share. The Company may be required to redeem this warrant under
the circumstances set forth therein.
2. The Company is required to guarantee obligations of Cellular
Marketing, Inc. in the amount of $66,000 in any six month period,
in addition to a rolling three month guarantee of the rent in the
amount of $12,000 per month.
3. All of the outstanding stock of Nova Cellular Co., a wholly-
owned subsidiary of the Company, is pledged to Core States Bank,
N.A.
4. Jay Brown has a warrant to purchase 125,000 shares of the
Company Common Stock at an exercise price of $9.25 per share.
The warrant grants to Mr. Brown piggyback registration rights
under the Securities Act of 1933, as amended.
<PAGE>
Exhibit 1 Page 68 of 131 Pages
Schedule 3.1(e)
1. The Company has obtained certificates of public convenience
and necessity and filed tariffs for the rates it can charge in
New York and California.
<PAGE>
Exhibit 1 Page 69 of 131 Pages
Schedule 3.1(i)
1. The Company has amended its 401(k) plan to increase annual
contributions by the Company from $750 to $1,000.
<PAGE>
Exhibit 1 Page 70 of 131 Pages
Schedule 3.1(k)
The Company has employment agreements with:
1. Bud Dealoia
2. Lynn Goffiney
3. Martin Johanson
4. Patrick McGuirk
5. Linda O'Neill (verbal agreement)
<PAGE>
Exhibit 1 Page 71 of 131 Pages
Schedule 3.1(l)
1. The Company has amended its 401(k) plan to increase annual
contributions by the Company from $750 to $1,000.
<PAGE>
Exhibit 1 Page 72 of 131 Pages
Schedule 3.1(m)
1. The Company has received an extension until September 15,
1995 for the filing of Form 1120 for the year ended December 31,
1994.
2. The Company has received identical extensions with respect to
all filings to be made in the states of New York, Illinois,
Massachusetts, Maryland, Pennsylvania, Virginia, New Jersey and
California.
<PAGE>
Exhibit 1 Page 73 of 131 Pages
Schedule 3.1(q)
1. In August 1991, the Company and CTS entered into a
Management Services Agreement pursuant to which Company personnel
would provide managerial, financial and administrative services
to CTS on a part-time or consulting basis for a monthly fee of
$25,000. This contract expires in August 1995.
2. The Company leases its principal office facility from
Phoenix Capital & Management Co., a partnership consisting of
three directors of the Company. The lease expired on October 31,
1994 and is continuing on a month-to-month basis.
3. The Company has entered into employment agreements with the
following individuals:
(a) Stephen Katz
(b) Joseph Gregori
(c) Jerome Sanders
(d) Harold F. Saving
(e) Edward Seidenberg
<PAGE>
Exhibit 1 Page 74 of 131 Pages
Schedule 4.1(g)
1. Borrowings under existing credit facilities in order to
finance the purchase and renovation of the Company's
headquarters.
<PAGE>
Exhibit 2 Page 75 of 131 Pages
VOTING AGREEMENT
VOTING AGREEMENT (this "Agreement"), dated as of May
22, 1995, among MCI COMMUNICATIONS CORPORATION, a Delaware
corporation (the "Parent"), NTS ACQUISITION CORP., a Delaware
corporation and an indirect wholly owned subsidiary of the Parent
(the "Purchaser"), and MERV ADELSON (the "Stockholder").
RECITALS
Concurrently herewith, the Parent, the Purchaser and
Nationwide Cellular Service, Inc., a Delaware corporation (the
"Company"), are entering into an Agreement and Plan of Merger
dated the date hereof (the "Merger Agreement"; capitalized terms
used but not defined herein shall have the meanings set forth in
the Merger Agreement), pursuant to which the Purchaser will merge
with and into the Company (the "Merger"), and each share of
Common Stock, par value $.01 per share, of the Company (the
"Company Common Stock") issued and outstanding immediately prior
to the Effective Time (as defined in Section 1.3 of the Merger
Agreement) will be converted into the right to receive $18.50,
payable to the holder thereof, without interest (the "Merger
Consideration").
As of the date hereof, the Stockholder directly
beneficially owns (i) 757,739 shares of Company Common Stock (the
"Existing Shares" and, together with any shares of Company Common
Stock acquired after the date hereof, whether upon the exercise
of the Warrant (as defined below), options, conversion of
convertible securities or otherwise, the "Shares")) and (ii) a
warrant (the "Warrant") to purchase up to 850,000 shares of
Company Common Stock at an exercise price of $11.00 per share.
As a condition to their willingness to enter into the
Merger Agreement and to consummate the transactions contemplated
thereby, the Parent and the Purchaser have required that the
Stockholder agree (i) simultaneously with the execution of the
Merger Agreement, to execute and deliver this Agreement and (ii)
to grant a proxy to vote all of the Shares owned by the
Stockholder on the terms and conditions provided for herein.
AGREEMENT
To implement the foregoing and in consideration of the
mutual agreements contained herein, the parties agree as follows:
1. Agreement to Vote; Proxy. (a) The Stockholder
hereby agrees that, during the time this Agreement is in effect,
at any meeting of the stockholders of the Company, however
called, or in connection with any written consent of the
<PAGE>
Exhibit 2 Page 76 of 131 Pages
stockholders of the Company, the Stockholder shall vote (or cause
to be voted) the Shares (i) in favor of the Merger, the execution
and delivery by the Company of the Merger Agreement and the
approval of the terms thereof and each of the other actions
contemplated by the Merger Agreement and this Agreement; (ii)
against any action or agreement that would result in a breach in
any material respect of any covenant, representation or warranty
or any other obligation or agreement of the Company under the
Merger Agreement or this Agreement; and (iii) against any action
or agreement (other than the Merger Agreement or the transactions
contemplated thereby) that is intended, or could reasonably be
expected, to impede, interfere with, delay, postpone, discourage
or materially adversely affect the Merger, this Agreement or the
Spin-Off Distribution (as defined in Section 4.11 of the Merger
Agreement), including, but not limited to: (A) any extraordinary
corporate transaction, such as a merger, consolidation or other
business combination involving the Company or its subsidiaries;
(B) a sale, lease or transfer of a material amount of assets of
the Company and its subsidiaries or a reorganization,
recapitalization or liquidation of the Company or its
subsidiaries; (C) any change in the management or board of
directors of the Company, except as otherwise agreed to in
writing by the Purchaser; (D) any material change in the present
capitalization or dividend policy of the Company or any amendment
of the Company's Certificate of Incorporation; or (E) any other
material change in the Company's corporate structure or business.
The Stockholder shall not enter into any agreement or
understanding with any person or entity prior to the termination
hereof to vote or give instructions after the termination hereof
in any manner inconsistent with clauses (i), (ii) or (iii) of the
preceding sentence.
(b) PROXY. THE STOCKHOLDER HEREBY GRANTS TO, AND
APPOINTS, THE PARENT AND THE SECRETARY OF THE PARENT AND THE
CHIEF FINANCIAL OFFICER OF THE PARENT, IN THEIR RESPECTIVE
CAPACITIES AS OFFICERS OF THE PARENT, AND ANY INDIVIDUAL WHO
SHALL HEREAFTER SUCCEED TO ANY SUCH OFFICE OF THE PARENT, AND ANY
OTHER DESIGNEE OF THE PARENT, EACH OF THEM INDIVIDUALLY, THE
STOCKHOLDER'S IRREVOCABLE PROXY AND ATTORNEY-IN-FACT (WITH FULL
POWER OF SUBSTITUTION) TO VOTE THE SHARES AS INDICATED IN SECTION
1(A). THE STOCKHOLDER INTENDS THIS PROXY TO BE IRREVOCABLE AND
COUPLED WITH AN INTEREST AND WILL TAKE SUCH FURTHER ACTION OR
EXECUTE SUCH OTHER INSTRUMENTS AS MAY BE NECESSARY TO EFFECTUATE
THE INTENT OF THIS PROXY AND HEREBY REVOKES ANY PROXY PREVIOUSLY
GRANTED BY HIM WITH RESPECT TO THE SHARES.
2. Expiration. This Agreement and the Parent's right
to vote the Shares covered hereby as set forth herein shall
terminate on the Expiration Date. As used herein, the term
"Expiration Date" means the first to occur of (a) the Effective
Time and (b) termination of the Merger Agreement in accordance
<PAGE>
Exhibit 2 Page 77 of 131 Pages
with its terms.
3. Representation and Warranties. (a) Representation
and Warranties of the Parent and the Purchaser. The Parent and
the Purchaser jointly and severally hereby represent and warrant
to the Stockholder as follows:
(i) Corporate Organization. Each of the Parent and
the Purchaser is a corporation duly organized, validly
existing and in good standing under the laws of the State of
Delaware and has the requisite corporate power and authority
and any necessary governmental authority to own, operate or
lease its properties and to carry on its business as it is
now being conducted, except where the failure to be so
organized, existing and in good standing or to have such
power, authority and governmental approvals could not,
individually or in the aggregate, reasonably be expected to
prevent the consummation of the Merger.
(ii) Authority Relative to Agreement. Each of the
Parent and the Purchaser has all necessary corporate power
and authority to enter into this Agreement, to perform its
obligations hereunder and to consummate the transactions
contemplated hereby. The execution, delivery and
performance of this Agreement by the Parent and the
Purchaser and, in the case of the Parent, subject to Section
5.2(f) of the Merger Agreement, the consummation by the
Parent and the Purchaser of the transactions contemplated
hereby have been duly authorized by all necessary corporate
action on the part of the Parent and the Purchaser. This
Agreement has been duly executed and delivered by each of
the Parent and the Purchaser and, assuming due
authorization, execution and delivery by the Stockholder,
constitutes a legal, valid and binding obligation of each
such corporation enforceable against such corporation in
accordance with its terms.
(iii) No Conflict. The execution, delivery and
performance of this Agreement by the Parent and the
Purchaser do not and will not: (A) conflict with or violate
the respective certificates of incorporation or by-laws of
the Parent or the Purchaser, as the case may be;
(B) assuming that all consents, approvals and authorizations
contemplated by Section 3.2(c)(ii) of the Merger Agreement
have been obtained and all filings described in such section
have been made, conflict with or violate any law, rule,
regulation, order, judgment or decree applicable to the
Parent or the Purchaser or by which either of them or their
respective properties are bound or affected; or (C) result
in any breach or violation of or constitute a default (or an
event which with notice or lapse of time or both could
<PAGE>
Exhibit 2 Page 78 of 131 Pages
become a default) or result in the loss of a material
benefit under, or give rise to any right of termination,
amendment, acceleration or cancellation of, or result in the
creation of a lien or encumbrance on any of the property or
assets of the Parent or the Purchaser pursuant to, any note,
bond, mortgage, indenture, contract, agreement, lease,
license, permit, franchise or other instrument or obligation
to which the Parent or the Purchaser is a party or by which
the Parent or the Purchaser or any of their respective
properties are bound or affected, except, in the case of
clauses (B) and (C), for any such conflicts, violations,
breaches, defaults or other occurrences which could not,
individually or in the aggregate, reasonably be expected to
prevent the consummation of the Merger.
(b) Representations and Warranties of the Stockholder.
The Stockholder hereby represents and warrants to the Parent and
the Purchaser as follows:
(i) Ownership of Shares. On the date hereof, the
Existing Shares are owned of record or beneficially by the
Stockholder, and, on the date hereof, the Existing Shares
constitute all of the shares of Company Common Stock owned
of record or beneficially by the Stockholder. The
Stockholder has sole voting power and sole power of
disposition with respect to all of the Existing Shares, with
no restrictions, subject to applicable federal securities
laws, on the Stockholder's rights of disposition pertaining
thereto.
(ii) Ownership of the Warrant. On the date hereof, the
Warrant is owned of record and beneficially by the
Stockholder. The Stockholder has the sole power to exercise
such Warrant and sole power of disposition with respect
thereto, and there are no restrictions, subject to the
federal securities laws, on the Stockholder's rights to
acquire Shares pursuant thereto or to dispose of any Shares
so acquired.
(iii) Power; Binding Agreement. The Stockholder has the
legal capacity, power and authority to enter into and
perform all of his obligations under this Agreement. The
execution, delivery and performance of this Agreement by the
Stockholder will not violate any other agreement to which
the Stockholder is a party including, without limitation,
any voting agreement, stockholders agreement or voting
trust. This Agreement has been duly executed and delivered
by the Stockholder and, assuming due authorization,
execution and delivery by the Parent and the Purchaser,
constitutes a legal, valid and binding obligation of the
Stockholder enforceable against the Stockholder in
<PAGE>
Exhibit 2 Page 79 of 131 Pages
accordance with its terms.
(iv) No Conflict. The execution, delivery and
performance of this Agreement by the Stockholder do not and
will not: (A) conflict with or violate any law, rule,
regulation, order, judgment or decree applicable to the
Stockholder or by which the Stockholder or his properties
are bound or affected; or (B) result in any breach or
violation of or constitute a default (or an event which with
notice or lapse of time or both could become a default) or
result in the loss of a material benefit under, or give rise
to any right of termination, amendment, acceleration or
cancellation of, or result in the creation of a lien or
encumbrance on any of the property or assets of the
Stockholder pursuant to, any note, bond, mortgage,
indenture, contract, agreement, lease, license, permit,
franchise or other instrument or obligation to which the
Stockholder is a party or by which the Stockholder or any of
his properties are bound or affected.
4. Certain Covenants of the Stockholder. In
accordance with the terms of this Agreement, the Stockholder
hereby covenants and agrees as follows:
(a) No Solicitation. The Stockholder shall not, while
this Agreement is in effect, and shall not authorize or
permit any investment banker, financial advisor, attorney,
accountant or other representative retained by him to,
solicit, encourage (including by way of furnishing
information), or take any other action to facilitate, any
inquiries or the making of any proposal which constitutes,
or may reasonably be expected to lead to, any Takeover
Proposal (as defined in the Merger Agreement), or agree to
or endorse any Takeover Proposal. If the Stockholder
receives or becomes aware of a Takeover Proposal, then the
Stockholder shall promptly inform the Parent of the terms
and conditions of such proposal and the identity of the
person making it. The Stockholder will immediately cease
and cause to be terminated any existing activities,
discussions or negotiations to which he is a party with any
parties conducted heretofore with respect to any of the
foregoing.
(b) Restriction on Transfer, Proxies and Non-
Interference. The Stockholder hereby agrees, while this
Agreement is in effect, and except as contemplated hereby,
not to (i) sell, transfer, pledge, encumber, assign or
otherwise dispose of, enforce or permit the execution of the
provisions of any redemption agreement with the Company or
enter into any contract, option or other arrangement or
understanding with respect to or consent to the offer for
<PAGE>
Exhibit 2 Page 80 of 131 Pages
sale, sale, transfer, pledge, encumbrance, assignment or
other disposition of, any of the Existing Shares, the
Warrant or any Shares acquired after the date hereof, or any
interest in any of the foregoing, (ii) grant any proxies or
powers of attorney, deposit any Shares into a voting trust
or enter into a voting agreement with respect to any Shares
or (iii) take any action that would make any representation
or warranty of the Stockholder contained herein untrue or
incorrect or have the effect of preventing or disabling the
Stockholder from performing his obligations under this
Agreement.
(c) Additional Shares. The Stockholder hereby agrees,
while this Agreement is in effect, to promptly notify the
Parent of the number of any new Shares of Company Common
Stock acquired by the Stockholder, if any, after the date
hereof.
(d) Stockholder Agreement. The Stockholder hereby
agrees promptly to terminate all provisions of the
Securities Purchase and Stockholder Agreement, dated January
11, 1990, as amended by letter agreement dated January 6,
1994, between the Company and the Stockholder, such
termination to be effective upon the Effective Time. The
Stockholder hereby further agrees that prior to the
Effective Time it will not exercise any registration rights
or any rights to require the Company to repurchase the
Warrant. The Stockholder acknowledges and agrees that it
shall not have any registration rights with respect to any
securities acquired upon conversion of the Shares in the
Merger.
5. Further Assurances. From time to time, at the
other party's request and without further consideration, each
party hereto shall execute and deliver such additional documents
and take all such further action as may be necessary or desirable
to consummate and make effective, in the most expeditious manner
practicable, the transactions contemplated by this Agreement.
6. Stop Transfer Order. In furtherance of this
Agreement, concurrently herewith, the Stockholder shall and
hereby does authorize the Company's counsel to notify the
Company's transfer agent that there is a stop transfer order with
respect to all of the Existing Shares (and that this Agreement
places limits on the voting and transfer of such shares).
7. Miscellaneous. (a) Entire Agreement; Assignment.
This Agreement (i) constitutes the entire agreement among the
parties with respect to the subject matter hereof and supersedes
all other prior agreements and understandings, both written and
oral, between the parties with respect to the subject matter
<PAGE>
Exhibit 2 Page 81 of 131 Pages
hereof and (ii) shall not be assigned by operation of law or
otherwise, provided that the Parent may assign its rights and
obligations hereunder to any direct or indirect wholly owned
subsidiary of the Parent, but no such assignment shall relieve
the Parent of its obligations hereunder if such assignee does not
perform such obligations.
(b) Amendments. 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.
(c) Notices. All notices, requests, claims, demands
and other communications hereunder shall be in writing and shall
be given (and shall be deemed to have been duly received if so
given) by hand delivery, telegram, telex or telecopy, or by mail
(registered or certified mail, postage prepaid, return receipt
requested) or by any courier service, such as Federal Express,
providing proof of delivery. All communications hereunder shall
be delivered to the respective parties at the following
addresses:
If to the
Stockholder: Merv Adelson
c/o East-West Capital Associates
10100 Santa Monica Blvd.
Los Angeles, CA 90067
If to the
Parent or
the Purchaser: MCI Communications Corporation
1801 Pennsylvania Avenue, N.W.
Washington, D.C. 20006
Attention: General Counsel
copy to: Simpson Thacher & Bartlett
425 Lexington Avenue
New York, New York 10017
Attention: Richard Capelouto, Esq.
or to such other address as the person to whom notice is given
may have previously furnished to the others in writing in the
manner set forth above.
(d) Governing Law. This Agreement shall be governed
by and construed in accordance with the laws of the State of
Delaware, regardless of the laws that might otherwise govern
under applicable principles of conflicts of laws thereof.
(e) Specific Performance. Each of the parties hereto
<PAGE>
Exhibit 2 Page 82 of 131 Pages
recognizes and acknowledges that a breach by it of any covenants
or agreements contained in this Agreement will cause the other
party to sustain damages for which it would not have an adequate
remedy at law for money damages, and therefore each of the
parties hereto agrees that in the event of any such breach the
aggrieved party shall be entitled to the remedy of specific
performance of such covenants and agreements and injunctive and
other equitable relief in addition to any other remedy to which
it may be entitled, at law or in equity.
(f) Counterparts. This Agreement may be executed in
two counterparts, each of which shall be deemed to be an
original, but both of which shall constitute one and the same
Agreement.
(g) Descriptive Headings. The descriptive headings
used herein are inserted for convenience of reference only and
are not intended to be part of or to affect the meaning or
interpretation of this Agreement.
(h) Severability. Whenever possible, each provision
or portion of any provision of this Agreement will be interpreted
in such manner as to be effective and valid under applicable law
but if any provision or portion of any provision of this
Agreement is held to be invalid, illegal or unenforceable in any
respect under any applicable law or rule in any jurisdiction,
such invalidity, illegality or unenforceability will not affect
any other provision or portion of any provision in such
jurisdiction, and this Agreement will be reformed, construed and
enforced in such jurisdiction as if such invalid, illegal or
unenforceable provision or portion of any provision had never
been contained herein.
<PAGE>
Exhibit 2 Page 83 of 131 Pages
IN WITNESS WHEREOF, the Parent, the Purchaser and the
Stockholder have caused this Agreement to be duly executed as of
the day and year first above written.
MCI COMMUNICATIONS CORPORATION
By: /s/ Susan Mayer
Name: Susan Mayer
Title: Senior Vice President
NTS ACQUISITION CORP.
By: /s/ Susan Mayer
Name: Susan Mayer
Title: Senior Vice President
MERV ADELSON
/s/ Merv Adelson
FOR PURPOSES OF SECTION 6 HEREOF,
ACKNOWLEDGED BY
NATIONWIDE CELLULAR SERVICE, INC.
By: /s/ Jerome Sanders
Name: Jerome Sanders
Title: Vice President
<PAGE>
Exhibit 3 Page 84 of 131 Pages
VOTING AGREEMENT
VOTING AGREEMENT (this "Agreement"), dated as of May
22, 1995, among MCI COMMUNICATIONS CORPORATION, a Delaware
corporation (the "Parent"), NTS ACQUISITION CORP., a Delaware
corporation and an indirect, wholly owned subsidiary of the
Parent (the "Purchaser"), and STEPHEN KATZ (the "Stockholder").
RECITALS
Concurrently herewith, the Parent, the Purchaser and
Nationwide Cellular Service, Inc., a Delaware corporation (the
"Company"), are entering into an Agreement and Plan of Merger
dated the date hereof (the "Merger Agreement"; capitalized terms
used but not defined herein shall have the meanings set forth in
the Merger Agreement), pursuant to which the Purchaser will merge
with and into the Company (the "Merger"), and each share of
Common Stock, par value $.01 per share, of the Company (the
"Company Common Stock") issued and outstanding immediately prior
to the Effective Time (as defined in Section 1.3 of the Merger
Agreement) will be converted into the right to receive $18.50,
payable to the holder thereof, without interest (the "Merger
Consideration").
As of the date hereof, the Stockholder directly
beneficially owns 313,325 shares of Company Common Stock (the
"Existing Shares" and, together with any shares of Company Common
Stock acquired after the date hereof, whether upon the exercise
of options, conversion of convertible securities or otherwise,
the "Shares").
As a condition to their willingness to enter into the
Merger Agreement and to consummate the transactions contemplated
thereby, the Parent and the Purchaser have required that the
Stockholder agree (i) simultaneously with the execution of the
Merger Agreement, to execute and deliver this Agreement and (ii)
to grant a proxy to vote all of the Shares owned by the
Stockholder on the terms and conditions provided for herein.
AGREEMENT
To implement the foregoing and in consideration of the
mutual agreements contained herein, the parties agree as follows:
1. Agreement to Vote; Proxy. (a) The Stockholder, in
his capacity as such, hereby agrees that, during the time this
Agreement is in effect, at any meeting of the stockholders of the
Company, however called, or in connection with any written
consent of the stockholders of the Company, the Stockholder shall
vote (or cause to be voted) the Shares (i) in favor of the
<PAGE>
Exhibit 3 Page 85 of 131 Pages
Merger, the execution and delivery by the Company of the Merger
Agreement and the approval of the terms thereof and each of the
other actions contemplated by the Merger Agreement and this
Agreement; (ii) against any action or agreement that would result
in a breach in any material respect of any covenant,
representation or warranty or any other obligation or agreement
of the Company under the Merger Agreement or this Agreement; and
(iii) against any action or agreement (other than the Merger
Agreement or the transactions contemplated thereby) that is
intended, or could reasonably be expected, to impede, interfere
with, delay, postpone, discourage or materially adversely affect
the Merger, this Agreement or the Spin-Off Distribution (as
defined in Section 4.11 of the Merger Agreement), including, but
not limited to: (A) any extraordinary corporate transaction, such
as a merger, consolidation or other business combination
involving the Company or its subsidiaries; (B) a sale, lease or
transfer of a material amount of assets of the Company and its
subsidiaries or a reorganization, recapitalization or liquidation
of the Company or its subsidiaries; (C) any change in the
management or board of directors of the Company, except as
otherwise agreed to in writing by the Purchaser; (D) any material
change in the present capitalization or dividend policy of the
Company or any amendment of the Company's Certificate of
Incorporation; or (E) any other material change in the Company's
corporate structure or business. The Stockholder shall not enter
into any agreement or understanding with any person or entity
prior to the termination hereof to vote or give instructions
after the termination hereof in any manner inconsistent with
clauses (i), (ii) or (iii) of the preceding sentence.
(b) PROXY. THE STOCKHOLDER HEREBY GRANTS TO, AND
APPOINTS, THE PARENT AND THE SECRETARY OF THE PARENT AND THE
CHIEF FINANCIAL OFFICER OF THE PARENT, IN THEIR RESPECTIVE
CAPACITIES AS OFFICERS OF THE PARENT, AND ANY INDIVIDUAL WHO
SHALL HEREAFTER SUCCEED TO ANY SUCH OFFICE OF THE PARENT, AND ANY
OTHER DESIGNEE OF THE PARENT, EACH OF THEM INDIVIDUALLY, THE
STOCKHOLDER'S IRREVOCABLE PROXY AND ATTORNEY-IN-FACT (WITH FULL
POWER OF SUBSTITUTION) TO VOTE THE SHARES AS INDICATED IN SECTION
1(A). THE STOCKHOLDER INTENDS THIS PROXY TO BE IRREVOCABLE AND
COUPLED WITH AN INTEREST AND WILL TAKE SUCH FURTHER ACTION OR
EXECUTE SUCH OTHER INSTRUMENTS AS MAY BE NECESSARY TO EFFECTUATE
THE INTENT OF THIS PROXY AND HEREBY REVOKES ANY PROXY PREVIOUSLY
GRANTED BY HIM WITH RESPECT TO THE SHARES.
2. Expiration. This Agreement and the Parent's right
to vote the Shares covered hereby as set forth herein shall
terminate on the Expiration Date. As used herein, the term
"Expiration Date" means the first to occur of (a) the Effective
Time and (b) termination of the Merger Agreement in accordance
with its terms.
<PAGE>
Exhibit 3 Page 86 of 131 Pages
3. Representation and Warranties. (a) Representation
and Warranties of the Parent and the Purchaser. The Parent and
the Purchaser jointly and severally hereby represent and warrant
to the Stockholder as follows:
(i) Corporate Organization. Each of the Parent and
the Purchaser is a corporation duly organized, validly
existing and in good standing under the laws of the State of
Delaware and has the requisite corporate power and authority
and any necessary governmental authority to own, operate or
lease its properties and to carry on its business as it is
now being conducted, except where the failure to be so
organized, existing and in good standing or to have such
power, authority and governmental approvals could not,
individually or in the aggregate, reasonably be expected to
prevent the consummation of the Merger.
(ii) Authority Relative to Agreement. Each of the
Parent and the Purchaser has all necessary corporate power
and authority to enter into this Agreement, to perform its
obligations hereunder and to consummate the transactions
contemplated hereby. The execution, delivery and
performance of this Agreement by the Parent and the
Purchaser and, in the case of the Parent, subject to Section
5.2(f) of the Merger Agreement, the consummation by the
Parent and the Purchaser of the transactions contemplated
hereby have been duly authorized by all necessary corporate
action on the part of the Parent and the Purchaser. This
Agreement has been duly executed and delivered by each of
the Parent and the Purchaser and, assuming due
authorization, execution and delivery by the Stockholder,
constitutes a legal, valid and binding obligation of each
such corporation enforceable against such corporation in
accordance with its terms.
(iii) No Conflict. The execution, delivery and
performance of this Agreement by the Parent and the
Purchaser do not and will not: (A) conflict with or violate
the respective certificates of incorporation or by-laws of
the Parent or the Purchaser, as the case may be;
(B) assuming that all consents, approvals and authorizations
contemplated by Section 3.2(c)(ii) of the Merger Agreement
have been obtained and all filings described in such section
have been made, conflict with or violate any law, rule,
regulation, order, judgment or decree applicable to the
Parent or the Purchaser or by which either of them or their
respective properties are bound or affected; or (C) result
in any breach or violation of or constitute a default (or an
event which with notice or lapse of time or both could
become a default) or result in the loss of a material
benefit under, or give rise to any right of termination,
<PAGE>
Exhibit 3 Page 87 of 131 Pages
amendment, acceleration or cancellation of, or result in the
creation of a lien or encumbrance on any of the property or
assets of the Parent or the Purchaser pursuant to, any note,
bond, mortgage, indenture, contract, agreement, lease,
license, permit, franchise or other instrument or obligation
to which the Parent or the Purchaser is a party or by which
the Parent or the Purchaser or any of their respective
properties are bound or affected, except, in the case of
clauses (B) and (C), for any such conflicts, violations,
breaches, defaults or other occurrences which could not,
individually or in the aggregate, reasonably be expected to
prevent the consummation of the Merger.
(b) Representations and Warranties of the Stockholder.
The Stockholder hereby represents and warrants to the Parent and
the Purchaser as follows:
(i) Ownership of Shares. On the date hereof, the
Existing Shares are owned of record or beneficially by the
Stockholder, and, on the date hereof, the Existing Shares
constitute all of the shares of Company Common Stock owned
of record or beneficially by the Stockholder other than
beneficially through the ownership of Options. The
Stockholder has sole voting power and sole power of
disposition with respect to all of the Existing Shares, with
no restrictions, subject to applicable federal securities
laws, on the Stockholder's rights of disposition pertaining
thereto.
(ii) Power; Binding Agreement. The Stockholder has the
legal capacity, power and authority to enter into and
perform all of his obligations under this Agreement. The
execution, delivery and performance of this Agreement by the
Stockholder will not violate any other agreement to which
the Stockholder is a party including, without limitation,
any voting agreement, stockholders agreement or voting
trust. This Agreement has been duly executed and delivered
by the Stockholder and, assuming due authorization,
execution and delivery by the Parent and the Purchaser,
constitutes a legal, valid and binding obligation of the
Stockholder enforceable against the Stockholder in
accordance with its terms.
(iii) No Conflict. The execution, delivery and
performance of this Agreement by the Stockholder do not and
will not: (A) conflict with or violate any law, rule,
regulation, order, judgment or decree applicable to the
Stockholder or by which the Stockholder or his properties
are bound or affected; or (B) result in any breach or
violation of or constitute a default (or an event which with
notice or lapse of time or both could become a default) or
<PAGE>
Exhibit 3 Page 88 of 131 Pages
result in the loss of a material benefit under, or give rise
to any right of termination, amendment, acceleration or
cancellation of, or result in the creation of a lien or
encumbrance on any of the property or assets of the
Stockholder pursuant to, any note, bond, mortgage,
indenture, contract, agreement, lease, license, permit,
franchise or other instrument or obligation to which the
Stockholder is a party or by which the Stockholder or any of
his properties are bound or affected.
4. Certain Covenants of the Stockholder. In
accordance with the terms of this Agreement, the Stockholder, in
his capacity as such, hereby covenants and agrees as follows:
(a) No Solicitation. The Stockholder shall not, while
this Agreement is in effect, and shall not authorize or
permit any investment banker, financial advisor, attorney,
accountant or other representative retained by him to,
solicit, encourage (including by way of furnishing
information), or take any other action to facilitate, any
inquiries or the making of any proposal which constitutes,
or may reasonably be expected to lead to, any Takeover
Proposal (as defined in the Merger Agreement), or agree to
or endorse any Takeover Proposal. If the Stockholder
receives or becomes aware of a Takeover Proposal, then the
Stockholder shall promptly inform the Parent of the terms
and conditions of such proposal and the identity of the
person making it. The Stockholder will immediately cease
and cause to be terminated any existing activities,
discussions or negotiations to which he is a party in his
capacity as a stockholder of the Company with any parties
conducted heretofore with respect to any of the foregoing.
(b) Restriction on Transfer, Proxies and Non-
Interference. The Stockholder hereby agrees, while this
Agreement is in effect, and except as contemplated hereby,
not to (i) sell, transfer, pledge, encumber, assign or
otherwise dispose of, enforce or permit the execution of the
provisions of any redemption agreement with the Company or
enter into any contract, option or other arrangement or
understanding with respect to or consent to the offer for
sale, sale, transfer, pledge, encumbrance, assignment or
other disposition of, any of the Existing Shares or Shares
acquired after the date hereof, or any interest in any of
the foregoing, (ii) grant any proxies or powers of attorney,
deposit any Shares into a voting trust or enter into a
voting agreement with respect to any Shares or (iii) take
any action that would make any representation or warranty of
the Stockholder contained herein untrue or incorrect or have
the effect of preventing or disabling the Stockholder from
performing his obligations under this Agreement.
<PAGE>
Exhibit 3 Page 89 of 131 Pages
(c) Additional Shares. The Stockholder hereby agrees,
while this Agreement is in effect, to promptly notify the
Parent of the number of any new Shares of Company Common
Stock acquired by the Stockholder, if any, after the date
hereof.
5. Further Assurances. From time to time, at the
other party's request and without further consideration,
each party hereto shall execute and deliver such additional
documents and take all such further action as may be
necessary or desirable to consummate and make effective, in
the most expeditious manner practicable, the transactions
contemplated by this Agreement.
6. Stop Transfer Order. In furtherance of this
Agreement, concurrently herewith, the Stockholder shall and
hereby does authorize the Company's counsel to notify the
Company's transfer agent that there is a stop transfer order with
respect to all of the Existing Shares (and that this Agreement
places limits on the voting and transfer of such shares).
7. Miscellaneous. (a) Entire Agreement; Assignment.
This Agreement (i) constitutes the entire agreement among the
parties with respect to the subject matter hereof and supersedes
all other prior agreements and understandings, both written and
oral, between the parties with respect to the subject matter
hereof and (ii) shall not be assigned by operation of law or
otherwise, provided that the Parent may assign its rights and
obligations hereunder to any direct or indirect wholly owned
subsidiary of the Parent, but no such assignment shall relieve
the Parent of its obligations hereunder if such assignee does not
perform such obligations.
(b) Amendments. 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.
(c) Notices. All notices, requests, claims, demands
and other communications hereunder shall be in writing and shall
be given (and shall be deemed to have been duly received if so
given) by hand delivery, telegram, telex or telecopy, or by mail
(registered or certified mail, postage prepaid, return receipt
requested) or by any courier service, such as Federal Express,
providing proof of delivery. All communications hereunder shall
be delivered to the respective parties at the following
addresses:
If to the
Stockholder: Stephen Katz
c/o Nationwide Cellular Service, Inc.
20 East Sunrise Highway
<PAGE>
Exhibit 3 Page 90 of 131 Pages
Valley Stream, New York 11582
If to the
Parent or
the Purchaser: MCI Communications Corporation
1801 Pennsylvania Avenue, N.W.
Washington, D.C. 20006
Attention: General Counsel
copy to: Simpson Thacher & Bartlett
425 Lexington Avenue
New York, New York 10017
Attention: Richard Capelouto, Esq.
or to such other address as the person to whom notice is given
may have previously furnished to the others in writing in the
manner set forth above.
(d) Governing Law. This Agreement shall be governed
by and construed in accordance with the laws of the State of
Delaware, regardless of the laws that might otherwise govern
under applicable principles of conflicts of laws thereof.
(e) Specific Performance. Each of the parties hereto
recognizes and acknowledges that a breach by it of any covenants
or agreements contained in this Agreement will cause the other
party to sustain damages for which it would not have an adequate
remedy at law for money damages, and therefore each of the
parties hereto agrees that in the event of any such breach the
aggrieved party shall be entitled to the remedy of specific
performance of such covenants and agreements and injunctive and
other equitable relief in addition to any other remedy to which
it may be entitled, at law or in equity.
(f) Counterparts. This Agreement may be executed in
two counterparts, each of which shall be deemed to be an
original, but both of which shall constitute one and the same
Agreement.
(g) Descriptive Headings. The descriptive headings
used herein are inserted for convenience of reference only and
are not intended to be part of or to affect the meaning or
interpretation of this Agreement.
(h) Severability. Whenever possible, each provision
or portion of any provision of this Agreement will be interpreted
in such manner as to be effective and valid under applicable law
but if any provision or portion of any provision of this
Agreement is held to be invalid, illegal or unenforceable in any
<PAGE>
Exhibit 3 Page 91 of 131 Pages
respect under any applicable law or rule in any jurisdiction,
such invalidity, illegality or unenforceability will not affect
any other provision or portion of any provision in such
jurisdiction, and this Agreement will be reformed, construed and
enforced in such jurisdiction as if such invalid, illegal or
unenforceable provision or portion of any provision had never
been contained herein.
IN WITNESS WHEREOF, the Parent, the Purchaser and the
Stockholder have caused this Agreement to be duly executed as of
the day and year first above written.
MCI COMMUNICATIONS CORPORATION
By: /s/ Susan Mayer
Name: Susan Mayer
Title: Senior Vice President
NTS ACQUISITION CORP.
By: /s/ Susan Mayer
Name: Susan Mayer
Title: Senior Vice President
STEPHEN KATZ
/s/ Stephen Katz
FOR PURPOSES OF SECTION 6 HEREOF,
ACKNOWLEDGED BY
NATIONWIDE CELLULAR SERVICE, INC.
By /s/ Edward Seidenberg
Name: Edward Seidenberg
Title: Vice President
<PAGE>
Exhibit 4 Page 92 of 131 Pages
VOTING AGREEMENT
VOTING AGREEMENT (this "Agreement"), dated as of May
22, 1995, among MCI COMMUNICATIONS CORPORATION, a Delaware
corporation (the "Parent"), NTS ACQUISITION CORP., a Delaware
corporation and an indirect, wholly owned subsidiary of the
Parent (the "Purchaser"), and JAY BERNSTEIN (the "Stockholder").
RECITALS
Concurrently herewith, the Parent, the Purchaser and
Nationwide Cellular Service, Inc., a Delaware corporation (the
"Company"), are entering into an Agreement and Plan of Merger
dated the date hereof (the "Merger Agreement"; capitalized terms
used but not defined herein shall have the meanings set forth in
the Merger Agreement), pursuant to which the Purchaser will merge
with and into the Company (the "Merger"), and each share of
Common Stock, par value $.01 per share, of the Company (the
"Company Common Stock") issued and outstanding immediately prior
to the Effective Time (as defined in Section 1.3 of the Merger
Agreement) will be converted into the right to receive $18.50,
payable to the holder thereof, without interest (the "Merger
Consideration").
As of the date hereof, the Stockholder directly
beneficially owns 390,000 shares of Company Common Stock (the
"Existing Shares" and, together with any shares of Company Common
Stock acquired after the date hereof, whether upon the exercise
of options, conversion of convertible securities or otherwise,
the "Shares").
As a condition to their willingness to enter into the
Merger Agreement and to consummate the transactions contemplated
thereby, the Parent and the Purchaser have required that the
Stockholder agree (i) simultaneously with the execution of the
Merger Agreement, to execute and deliver this Agreement and (ii)
to grant a proxy to vote all of the Shares owned by the
Stockholder on the terms and conditions provided for herein.
AGREEMENT
To implement the foregoing and in consideration of the
mutual agreements contained herein, the parties agree as follows:
1. Agreement to Vote; Proxy. (a) The Stockholder, in
his capacity as such, hereby agrees that, during the time this
Agreement is in effect, at any meeting of the stockholders of the
Company, however called, or in connection with any written
consent of the stockholders of the Company, the Stockholder shall
vote (or cause to be voted) the Shares (i) in favor of the
Merger, the execution and delivery by the Company of the Merger
<PAGE>
Exhibit 4 Page 93 of 131 Pages
Agreement and the approval of the terms thereof and each of the
other actions contemplated by the Merger Agreement and this
Agreement; (ii) against any action or agreement that would result
in a breach in any material respect of any covenant,
representation or warranty or any other obligation or agreement
of the Company under the Merger Agreement or this Agreement; and
(iii) against any action or agreement (other than the Merger
Agreement or the transactions contemplated thereby) that is
intended, or could reasonably be expected, to impede, interfere
with, delay, postpone, discourage or materially adversely affect
the Merger, this Agreement or the Spin-Off Distribution (as
defined in Section 4.11 of the Merger Agreement), including, but
not limited to: (A) any extraordinary corporate transaction, such
as a merger, consolidation or other business combination
involving the Company or its subsidiaries; (B) a sale, lease or
transfer of a material amount of assets of the Company and its
subsidiaries or a reorganization, recapitalization or liquidation
of the Company or its subsidiaries; (C) any change in the
management or board of directors of the Company, except as
otherwise agreed to in writing by the Purchaser; (D) any material
change in the present capitalization or dividend policy of the
Company or any amendment of the Company's Certificate of
Incorporation; or (E) any other material change in the Company's
corporate structure or business. The Stockholder shall not enter
into any agreement or understanding with any person or entity
prior to the termination hereof to vote or give instructions
after the termination hereof in any manner inconsistent with
clauses (i), (ii) or (iii) of the preceding sentence.
(b) PROXY. THE STOCKHOLDER HEREBY GRANTS TO, AND
APPOINTS, THE PARENT AND THE SECRETARY OF THE PARENT AND THE
CHIEF FINANCIAL OFFICER OF THE PARENT, IN THEIR RESPECTIVE
CAPACITIES AS OFFICERS OF THE PARENT, AND ANY INDIVIDUAL WHO
SHALL HEREAFTER SUCCEED TO ANY SUCH OFFICE OF THE PARENT, AND ANY
OTHER DESIGNEE OF THE PARENT, EACH OF THEM INDIVIDUALLY, THE
STOCKHOLDER'S IRREVOCABLE PROXY AND ATTORNEY-IN-FACT (WITH FULL
POWER OF SUBSTITUTION) TO VOTE THE SHARES AS INDICATED IN SECTION
1(A). THE STOCKHOLDER INTENDS THIS PROXY TO BE IRREVOCABLE AND
COUPLED WITH AN INTEREST AND WILL TAKE SUCH FURTHER ACTION OR
EXECUTE SUCH OTHER INSTRUMENTS AS MAY BE NECESSARY TO EFFECTUATE
THE INTENT OF THIS PROXY AND HEREBY REVOKES ANY PROXY PREVIOUSLY
GRANTED BY HIM WITH RESPECT TO THE SHARES.
2. Expiration. This Agreement and the Parent's right
to vote the Shares covered hereby as set forth herein shall
terminate on the Expiration Date. As used herein, the term
"Expiration Date" means the first to occur of (a) the Effective
Time and (b) termination of the Merger Agreement in accordance
with its terms.
3. Representation and Warranties. (a) Representation
<PAGE>
Exhibit 4 Page 94 of 131 Pages
and Warranties of the Parent and the Purchaser. The Parent and
the Purchaser jointly and severally hereby represent and warrant
to the Stockholder as follows:
(i) Corporate Organization. Each of the Parent and
the Purchaser is a corporation duly organized, validly
existing and in good standing under the laws of the State of
Delaware and has the requisite corporate power and authority
and any necessary governmental authority to own, operate or
lease its properties and to carry on its business as it is
now being conducted, except where the failure to be so
organized, existing and in good standing or to have such
power, authority and governmental approvals could not,
individually or in the aggregate, reasonably be expected to
prevent the consummation of the Merger.
(ii) Authority Relative to Agreement. Each of the
Parent and the Purchaser has all necessary corporate power
and authority to enter into this Agreement, to perform its
obligations hereunder and to consummate the transactions
contemplated hereby. The execution, delivery and
performance of this Agreement by the Parent and the
Purchaser and, in the case of the Parent, subject to Section
5.2(f) of the Merger Agreement, the consummation by the
Parent and the Purchaser of the transactions contemplated
hereby have been duly authorized by all necessary corporate
action on the part of the Parent and the Purchaser. This
Agreement has been duly executed and delivered by each of
the Parent and the Purchaser and, assuming due
authorization, execution and delivery by the Stockholder,
constitutes a legal, valid and binding obligation of each
such corporation enforceable against such corporation in
accordance with its terms.
(iii) No Conflict. The execution, delivery and
performance of this Agreement by the Parent and the
Purchaser do not and will not: (A) conflict with or violate
the respective certificates of incorporation or by-laws of
the Parent or the Purchaser, as the case may be;
(B) assuming that all consents, approvals and authorizations
contemplated by Section 3.2(c)(ii) of the Merger Agreement
have been obtained and all filings described in such section
have been made, conflict with or violate any law, rule,
regulation, order, judgment or decree applicable to the
Parent or the Purchaser or by which either of them or their
respective properties are bound or affected; or (C) result
in any breach or violation of or constitute a default (or an
event which with notice or lapse of time or both could
become a default) or result in the loss of a material
benefit under, or give rise to any right of termination,
amendment, acceleration or cancellation of, or result in the
<PAGE>
Exhibit 4 Page 95 of 131 Pages
creation of a lien or encumbrance on any of the property or
assets of the Parent or the Purchaser pursuant to, any note,
bond, mortgage, indenture, contract, agreement, lease,
license, permit, franchise or other instrument or obligation
to which the Parent or the Purchaser is a party or by which
the Parent or the Purchaser or any of their respective
properties are bound or affected, except, in the case of
clauses (B) and (C), for any such conflicts, violations,
breaches, defaults or other occurrences which could not,
individually or in the aggregate, reasonably be expected to
prevent the consummation of the Merger.
(b) Representations and Warranties of the Stockholder.
The Stockholder hereby represents and warrants to the Parent and
the Purchaser as follows:
(i) Ownership of Shares. On the date hereof, the
Existing Shares are owned of record or beneficially by the
Stockholder, and, on the date hereof, the Existing Shares
constitute all of the shares of Company Common Stock owned
of record or beneficially by the Stockholder other than
beneficially through the ownership of Options. The
Stockholder has sole voting power and sole power of
disposition with respect to all of the Existing Shares, with
no restrictions, subject to applicable federal securities
laws, on the Stockholder's rights of disposition pertaining
thereto.
(ii) Power; Binding Agreement. The Stockholder has the
legal capacity, power and authority to enter into and
perform all of his obligations under this Agreement. The
execution, delivery and performance of this Agreement by the
Stockholder will not violate any other agreement to which
the Stockholder is a party including, without limitation,
any voting agreement, stockholders agreement or voting
trust. This Agreement has been duly executed and delivered
by the Stockholder and, assuming due authorization,
execution and delivery by the Parent and the Purchaser,
constitutes a legal, valid and binding obligation of the
Stockholder enforceable against the Stockholder in
accordance with its terms.
(iii) No Conflict. The execution, delivery and
performance of this Agreement by the Stockholder do not and
will not: (A) conflict with or violate any law, rule,
regulation, order, judgment or decree applicable to the
Stockholder or by which the Stockholder or his properties
are bound or affected; or (B) result in any breach or
violation of or constitute a default (or an event which with
notice or lapse of time or both could become a default) or
result in the loss of a material benefit under, or give rise
<PAGE>
Exhibit 4 Page 96 of 131 Pages
to any right of termination, amendment, acceleration or
cancellation of, or result in the creation of a lien or
encumbrance on any of the property or assets of the
Stockholder pursuant to, any note, bond, mortgage,
indenture, contract, agreement, lease, license, permit,
franchise or other instrument or obligation to which the
Stockholder is a party or by which the Stockholder or any of
his properties are bound or affected.
4. Certain Covenants of the Stockholder. In
accordance with the terms of this Agreement, the Stockholder, in
his capacity as such, hereby covenants and agrees as follows:
(a) No Solicitation. The Stockholder shall not, while
this Agreement is in effect, and shall not authorize or
permit any investment banker, financial advisor, attorney,
accountant or other representative retained by him to,
solicit, encourage (including by way of furnishing
information), or take any other action to facilitate, any
inquiries or the making of any proposal which constitutes,
or may reasonably be expected to lead to, any Takeover
Proposal (as defined in the Merger Agreement), or agree to
or endorse any Takeover Proposal. If the Stockholder
receives or becomes aware of a Takeover Proposal, then the
Stockholder shall promptly inform the Parent of the terms
and conditions of such proposal and the identity of the
person making it. The Stockholder will immediately cease
and cause to be terminated any existing activities,
discussions or negotiations to which he is a party in his
capacity as a stockholder of the Company with any parties
conducted heretofore with respect to any of the foregoing.
(b) Restriction on Transfer, Proxies and Non-
Interference. The Stockholder hereby agrees, while this
Agreement is in effect, and except as contemplated hereby,
not to (i) sell, transfer, pledge, encumber, assign or
otherwise dispose of, enforce or permit the execution of the
provisions of any redemption agreement with the Company or
enter into any contract, option or other arrangement or
understanding with respect to or consent to the offer for
sale, sale, transfer, pledge, encumbrance, assignment or
other disposition of, any of the Existing Shares or Shares
acquired after the date hereof, or any interest in any of
the foregoing, (ii) grant any proxies or powers of attorney,
deposit any Shares into a voting trust or enter into a
voting agreement with respect to any Shares or (iii) take
any action that would make any representation or warranty of
the Stockholder contained herein untrue or incorrect or have
the effect of preventing or disabling the Stockholder from
performing his obligations under this Agreement.
<PAGE>
Exhibit 4 Page 97 of 131 Pages
(c) Additional Shares. The Stockholder hereby agrees,
while this Agreement is in effect, to promptly notify the
Parent of the number of any new Shares of Company Common
Stock acquired by the Stockholder, if any, after the date
hereof.
5. Further Assurances. From time to time, at the
other party's request and without further consideration,
each party hereto shall execute and deliver such additional
documents and take all such further action as may be
necessary or desirable to consummate and make effective, in
the most expeditious manner practicable, the transactions
contemplated by this Agreement.
6. Stop Transfer Order. In furtherance of this
Agreement, concurrently herewith, the Stockholder shall and
hereby does authorize the Company's counsel to notify the
Company's transfer agent that there is a stop transfer order with
respect to all of the Existing Shares (and that this Agreement
places limits on the voting and transfer of such shares).
7. Miscellaneous. (a) Entire Agreement; Assignment.
This Agreement (i) constitutes the entire agreement among the
parties with respect to the subject matter hereof and supersedes
all other prior agreements and understandings, both written and
oral, between the parties with respect to the subject matter
hereof and (ii) shall not be assigned by operation of law or
otherwise, provided that the Parent may assign its rights and
obligations hereunder to any direct or indirect wholly owned
subsidiary of the Parent, but no such assignment shall relieve
the Parent of its obligations hereunder if such assignee does not
perform such obligations.
(b) Amendments. 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.
(c) Notices. All notices, requests, claims, demands
and other communications hereunder shall be in writing and shall
be given (and shall be deemed to have been duly received if so
given) by hand delivery, telegram, telex or telecopy, or by mail
(registered or certified mail, postage prepaid, return receipt
requested) or by any courier service, such as Federal Express,
providing proof of delivery. All communications hereunder shall
be delivered to the respective parties at the following
addresses:
If to the
Stockholder: Jay Bernstein
c/o Nationwide Cellular Service, Inc.
20 East Sunrise Highway
<PAGE>
Exhibit 4 Page 98 of 131 Pages
Valley Stream, New York 11582
If to the
Parent or
the Purchaser: MCI Communications Corporation
1801 Pennsylvania Avenue, N.W.
Washington, D.C. 20006
Attention: General Counsel
copy to: Simpson Thacher & Bartlett
425 Lexington Avenue
New York, New York 10017
Attention: Richard Capelouto, Esq.
or to such other address as the person to whom notice is given
may have previously furnished to the others in writing in the
manner set forth above.
(d) Governing Law. This Agreement shall be governed
by and construed in accordance with the laws of the State of
Delaware, regardless of the laws that might otherwise govern
under applicable principles of conflicts of laws thereof.
(e) Specific Performance. Each of the parties hereto
recognizes and acknowledges that a breach by it of any covenants
or agreements contained in this Agreement will cause the other
party to sustain damages for which it would not have an adequate
remedy at law for money damages, and therefore each of the
parties hereto agrees that in the event of any such breach the
aggrieved party shall be entitled to the remedy of specific
performance of such covenants and agreements and injunctive and
other equitable relief in addition to any other remedy to which
it may be entitled, at law or in equity.
(f) Counterparts. This Agreement may be executed in
two counterparts, each of which shall be deemed to be an
original, but both of which shall constitute one and the same
Agreement.
(g) Descriptive Headings. The descriptive headings
used herein are inserted for convenience of reference only and
are not intended to be part of or to affect the meaning or
interpretation of this Agreement.
(h) Severability. Whenever possible, each provision
or portion of any provision of this Agreement will be interpreted
in such manner as to be effective and valid under applicable law
but if any provision or portion of any provision of this
Agreement is held to be invalid, illegal or unenforceable in any
<PAGE>
Exhibit 4 Page 99 of 131 Pages
respect under any applicable law or rule in any jurisdiction,
such invalidity, illegality or unenforceability will not affect
any other provision or portion of any provision in such
jurisdiction, and this Agreement will be reformed, construed and
enforced in such jurisdiction as if such invalid, illegal or
unenforceable provision or portion of any provision had never
been contained herein.
IN WITNESS WHEREOF, the Parent, the Purchaser and the
Stockholder have caused this Agreement to be duly executed as of
the day and year first above written.
MCI COMMUNICATIONS CORPORATION
By: /s/ Susan Mayer
Name: Susan Mayer
Title: Senior Vice President
NTS ACQUISITION CORP.
By: /s/ Susan Mayer
Name: Susan Mayer
Title: Senior Vice President
JAY BERNSTEIN
/s/ Jay Bernstein
FOR PURPOSES OF SECTION 6 HEREOF,
ACKNOWLEDGED BY
NATIONWIDE CELLULAR SERVICE, INC.
By: /s/ Stephen Katz
Name: Stephen Katz
Title: Chief Executive Officer
<PAGE>
Exhibit 5 Page 100 of 131 Pages
VOTING AGREEMENT
VOTING AGREEMENT (this "Agreement"), dated as of May
22, 1995, among MCI COMMUNICATIONS CORPORATION, a Delaware
corporation (the "Parent"), NTS ACQUISITION CORP., a Delaware
corporation and an indirect, wholly owned subsidiary of the
Parent (the "Purchaser"), and MEL STEINBERG (the "Stockholder").
RECITALS
Concurrently herewith, the Parent, the Purchaser and
Nationwide Cellular Service, Inc., a Delaware corporation (the
"Company"), are entering into an Agreement and Plan of Merger
dated the date hereof (the "Merger Agreement"; capitalized terms
used but not defined herein shall have the meanings set forth in
the Merger Agreement), pursuant to which the Purchaser will merge
with and into the Company (the "Merger"), and each share of
Common Stock, par value $.01 per share, of the Company (the
"Company Common Stock") issued and outstanding immediately prior
to the Effective Time (as defined in Section 1.3 of the Merger
Agreement) will be converted into the right to receive $18.50,
payable to the holder thereof, without interest (the "Merger
Consideration").
As of the date hereof, the Stockholder directly
beneficially owns 308,000 shares of Company Common Stock (the
"Existing Shares" and, together with any shares of Company Common
Stock acquired after the date hereof, whether upon the exercise
of options, conversion of convertible securities or otherwise,
the "Shares").
As a condition to their willingness to enter into the
Merger Agreement and to consummate the transactions contemplated
thereby, the Parent and the Purchaser have required that the
Stockholder agree (i) simultaneously with the execution of the
Merger Agreement, to execute and deliver this Agreement and (ii)
to grant a proxy to vote all of the Shares owned by the
Stockholder on the terms and conditions provided for herein.
AGREEMENT
To implement the foregoing and in consideration of the
mutual agreements contained herein, the parties agree as follows:
1. Agreement to Vote; Proxy. (a) The Stockholder, in
his capacity as such, hereby agrees that, during the time this
Agreement is in effect, at any meeting of the stockholders of the
Company, however called, or in connection with any written
consent of the stockholders of the Company, the Stockholder shall
vote (or cause to be voted) the Shares (i) in favor of the
<PAGE>
Exhibit 5 Page 101 of 131 Pages
Merger, the execution and delivery by the Company of the Merger
Agreement and the approval of the terms thereof and each of the
other actions contemplated by the Merger Agreement and this
Agreement; (ii) against any action or agreement that would result
in a breach in any material respect of any covenant,
representation or warranty or any other obligation or agreement
of the Company under the Merger Agreement or this Agreement; and
(iii) against any action or agreement (other than the Merger
Agreement or the transactions contemplated thereby) that is
intended, or could reasonably be expected, to impede, interfere
with, delay, postpone, discourage or materially adversely affect
the Merger, this Agreement or the Spin-Off Distribution (as
defined in Section 4.11 of the Merger Agreement), including, but
not limited to: (A) any extraordinary corporate transaction, such
as a merger, consolidation or other business combination
involving the Company or its subsidiaries; (B) a sale, lease or
transfer of a material amount of assets of the Company and its
subsidiaries or a reorganization, recapitalization or liquidation
of the Company or its subsidiaries; (C) any change in the
management or board of directors of the Company, except as
otherwise agreed to in writing by the Purchaser; (D) any material
change in the present capitalization or dividend policy of the
Company or any amendment of the Company's Certificate of
Incorporation; or (E) any other material change in the Company's
corporate structure or business. The Stockholder shall not enter
into any agreement or understanding with any person or entity
prior to the termination hereof to vote or give instructions
after the termination hereof in any manner inconsistent with
clauses (i), (ii) or (iii) of the preceding sentence.
(b) PROXY. THE STOCKHOLDER HEREBY GRANTS TO, AND
APPOINTS, THE PARENT AND THE SECRETARY OF THE PARENT AND THE
CHIEF FINANCIAL OFFICER OF THE PARENT, IN THEIR RESPECTIVE
CAPACITIES AS OFFICERS OF THE PARENT, AND ANY INDIVIDUAL WHO
SHALL HEREAFTER SUCCEED TO ANY SUCH OFFICE OF THE PARENT, AND ANY
OTHER DESIGNEE OF THE PARENT, EACH OF THEM INDIVIDUALLY, THE
STOCKHOLDER'S IRREVOCABLE PROXY AND ATTORNEY-IN-FACT (WITH FULL
POWER OF SUBSTITUTION) TO VOTE THE SHARES AS INDICATED IN SECTION
1(A). THE STOCKHOLDER INTENDS THIS PROXY TO BE IRREVOCABLE AND
COUPLED WITH AN INTEREST AND WILL TAKE SUCH FURTHER ACTION OR
EXECUTE SUCH OTHER INSTRUMENTS AS MAY BE NECESSARY TO EFFECTUATE
THE INTENT OF THIS PROXY AND HEREBY REVOKES ANY PROXY PREVIOUSLY
GRANTED BY HIM WITH RESPECT TO THE SHARES.
2. Expiration. This Agreement and the Parent's right
to vote the Shares covered hereby as set forth herein shall
terminate on the Expiration Date. As used herein, the term
"Expiration Date" means the first to occur of (a) the Effective
Time and (b) termination of the Merger Agreement in accordance
with its terms.
<PAGE>
Exhibit 5 Page 102 of 131 Pages
3. Representation and Warranties. (a) Representation
and Warranties of the Parent and the Purchaser. The Parent and
the Purchaser jointly and severally hereby represent and warrant
to the Stockholder as follows:
(i) Corporate Organization. Each of the Parent and
the Purchaser is a corporation duly organized, validly
existing and in good standing under the laws of the State of
Delaware and has the requisite corporate power and authority
and any necessary governmental authority to own, operate or
lease its properties and to carry on its business as it is
now being conducted, except where the failure to be so
organized, existing and in good standing or to have such
power, authority and governmental approvals could not,
individually or in the aggregate, reasonably be expected to
prevent the consummation of the Merger.
(ii) Authority Relative to Agreement. Each of the
Parent and the Purchaser has all necessary corporate power
and authority to enter into this Agreement, to perform its
obligations hereunder and to consummate the transactions
contemplated hereby. The execution, delivery and
performance of this Agreement by the Parent and the
Purchaser and, in the case of the Parent, subject to Section
5.2(f) of the Merger Agreement, the consummation by the
Parent and the Purchaser of the transactions contemplated
hereby have been duly authorized by all necessary corporate
action on the part of the Parent and the Purchaser. This
Agreement has been duly executed and delivered by each of
the Parent and the Purchaser and, assuming due
authorization, execution and delivery by the Stockholder,
constitutes a legal, valid and binding obligation of each
such corporation enforceable against such corporation in
accordance with its terms.
(iii) No Conflict. The execution, delivery and
performance of this Agreement by the Parent and the
Purchaser do not and will not: (A) conflict with or violate
the respective certificates of incorporation or by-laws of
the Parent or the Purchaser, as the case may be;
(B) assuming that all consents, approvals and authorizations
contemplated by Section 3.2(c)(ii) of the Merger Agreement
have been obtained and all filings described in such section
have been made, conflict with or violate any law, rule,
regulation, order, judgment or decree applicable to the
Parent or the Purchaser or by which either of them or their
respective properties are bound or affected; or (C) result
in any breach or violation of or constitute a default (or an
event which with notice or lapse of time or both could
become a default) or result in the loss of a material
benefit under, or give rise to any right of termination,
<PAGE>
Exhibit 5 Page 103 of 131 Pages
amendment, acceleration or cancellation of, or result in the
creation of a lien or encumbrance on any of the property or
assets of the Parent or the Purchaser pursuant to, any note,
bond, mortgage, indenture, contract, agreement, lease,
license, permit, franchise or other instrument or obligation
to which the Parent or the Purchaser is a party or by which
the Parent or the Purchaser or any of their respective
properties are bound or affected, except, in the case of
clauses (B) and (C), for any such conflicts, violations,
breaches, defaults or other occurrences which could not,
individually or in the aggregate, reasonably be expected to
prevent the consummation of the Merger.
(b) Representations and Warranties of the Stockholder.
The Stockholder hereby represents and warrants to the Parent and
the Purchaser as follows:
(i) Ownership of Shares. On the date hereof, the
Existing Shares are owned of record or beneficially by the
Stockholder, and, on the date hereof, the Existing Shares
constitute all of the shares of Company Common Stock owned
of record or beneficially by the Stockholder other than
beneficially through the ownership of Options. The
Stockholder has sole voting power and sole power of
disposition with respect to all of the Existing Shares, with
no restrictions, subject to applicable federal securities
laws, on the Stockholder's rights of disposition pertaining
thereto.
(ii) Power; Binding Agreement. The Stockholder has the
legal capacity, power and authority to enter into and
perform all of his obligations under this Agreement. The
execution, delivery and performance of this Agreement by the
Stockholder will not violate any other agreement to which
the Stockholder is a party including, without limitation,
any voting agreement, stockholders agreement or voting
trust. This Agreement has been duly executed and delivered
by the Stockholder and, assuming due authorization,
execution and delivery by the Parent and the Purchaser,
constitutes a legal, valid and binding obligation of the
Stockholder enforceable against the Stockholder in
accordance with its terms.
(iii) No Conflict. The execution, delivery and
performance of this Agreement by the Stockholder do not and
will not: (A) conflict with or violate any law, rule,
regulation, order, judgment or decree applicable to the
Stockholder or by which the Stockholder or his properties
are bound or affected; or (B) result in any breach or
violation of or constitute a default (or an event which with
notice or lapse of time or both could become a default) or
<PAGE>
Exhibit 5 Page 104 of 131 Pages
result in the loss of a material benefit under, or give rise
to any right of termination, amendment, acceleration or
cancellation of, or result in the creation of a lien or
encumbrance on any of the property or assets of the
Stockholder pursuant to, any note, bond, mortgage,
indenture, contract, agreement, lease, license, permit,
franchise or other instrument or obligation to which the
Stockholder is a party or by which the Stockholder or any of
his properties are bound or affected.
4. Certain Covenants of the Stockholder. In
accordance with the terms of this Agreement, the Stockholder, in
his capacity as such, hereby covenants and agrees as follows:
(a) No Solicitation. The Stockholder shall not, while
this Agreement is in effect, and shall not authorize or
permit any investment banker, financial advisor, attorney,
accountant or other representative retained by him to,
solicit, encourage (including by way of furnishing
information), or take any other action to facilitate, any
inquiries or the making of any proposal which constitutes,
or may reasonably be expected to lead to, any Takeover
Proposal (as defined in the Merger Agreement), or agree to
or endorse any Takeover Proposal. If the Stockholder
receives or becomes aware of a Takeover Proposal, then the
Stockholder shall promptly inform the Parent of the terms
and conditions of such proposal and the identity of the
person making it. The Stockholder will immediately cease
and cause to be terminated any existing activities,
discussions or negotiations to which he is a party in his
capacity as a stockholder of the Company with any parties
conducted heretofore with respect to any of the foregoing.
(b) Restriction on Transfer, Proxies and Non-
Interference. The Stockholder hereby agrees, while this
Agreement is in effect, and except as contemplated hereby,
not to (i) sell, transfer, pledge, encumber, assign or
otherwise dispose of, enforce or permit the execution of the
provisions of any redemption agreement with the Company or
enter into any contract, option or other arrangement or
understanding with respect to or consent to the offer for
sale, sale, transfer, pledge, encumbrance, assignment or
other disposition of, any of the Existing Shares or Shares
acquired after the date hereof, or any interest in any of
the foregoing, (ii) grant any proxies or powers of attorney,
deposit any Shares into a voting trust or enter into a
voting agreement with respect to any Shares or (iii) take
any action that would make any representation or warranty of
the Stockholder contained herein untrue or incorrect or have
the effect of preventing or disabling the Stockholder from
performing his obligations under this Agreement.
<PAGE>
Exhibit 5 Page 105 of 131 Pages
(c) Additional Shares. The Stockholder hereby agrees,
while this Agreement is in effect, to promptly notify the
Parent of the number of any new Shares of Company Common
Stock acquired by the Stockholder, if any, after the date
hereof.
5. Further Assurances. From time to time, at the
other party's request and without further consideration,
each party hereto shall execute and deliver such additional
documents and take all such further action as may be
necessary or desirable to consummate and make effective, in
the most expeditious manner practicable, the transactions
contemplated by this Agreement.
6. Stop Transfer Order. In furtherance of this
Agreement, concurrently herewith, the Stockholder shall and
hereby does authorize the Company's counsel to notify the
Company's transfer agent that there is a stop transfer order with
respect to all of the Existing Shares (and that this Agreement
places limits on the voting and transfer of such shares).
7. Miscellaneous. (a) Entire Agreement; Assignment.
This Agreement (i) constitutes the entire agreement among the
parties with respect to the subject matter hereof and supersedes
all other prior agreements and understandings, both written and
oral, between the parties with respect to the subject matter
hereof and (ii) shall not be assigned by operation of law or
otherwise, provided that the Parent may assign its rights and
obligations hereunder to any direct or indirect wholly owned
subsidiary of the Parent, but no such assignment shall relieve
the Parent of its obligations hereunder if such assignee does not
perform such obligations.
(b) Amendments. 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.
(c) Notices. All notices, requests, claims, demands
and other communications hereunder shall be in writing and shall
be given (and shall be deemed to have been duly received if so
given) by hand delivery, telegram, telex or telecopy, or by mail
(registered or certified mail, postage prepaid, return receipt
requested) or by any courier service, such as Federal Express,
providing proof of delivery. All communications hereunder shall
be delivered to the respective parties at the following
addresses:
If to the
Stockholder: Mel Steinberg
c/o Nationwide Cellular Service, Inc.
20 East Sunrise Highway
<PAGE>
Exhibit 5 Page 106 of 131 Pages
Valley Stream, New York 11582
If to the
Parent or
the Purchaser: MCI Communications Corporation
1801 Pennsylvania Avenue, N.W.
Washington, D.C. 20006
Attention: General Counsel
copy to: Simpson Thacher & Bartlett
425 Lexington Avenue
New York, New York 10017
Attention: Richard Capelouto, Esq.
or to such other address as the person to whom notice is given
may have previously furnished to the others in writing in the
manner set forth above.
(d) Governing Law. This Agreement shall be governed
by and construed in accordance with the laws of the State of
Delaware, regardless of the laws that might otherwise govern
under applicable principles of conflicts of laws thereof.
(e) Specific Performance. Each of the parties hereto
recognizes and acknowledges that a breach by it of any covenants
or agreements contained in this Agreement will cause the other
party to sustain damages for which it would not have an adequate
remedy at law for money damages, and therefore each of the
parties hereto agrees that in the event of any such breach the
aggrieved party shall be entitled to the remedy of specific
performance of such covenants and agreements and injunctive and
other equitable relief in addition to any other remedy to which
it may be entitled, at law or in equity.
(f) Counterparts. This Agreement may be executed in
two counterparts, each of which shall be deemed to be an
original, but both of which shall constitute one and the same
Agreement.
(g) Descriptive Headings. The descriptive headings
used herein are inserted for convenience of reference only and
are not intended to be part of or to affect the meaning or
interpretation of this Agreement.
(h) Severability. Whenever possible, each provision
or portion of any provision of this Agreement will be interpreted
in such manner as to be effective and valid under applicable law
but if any provision or portion of any provision of this
Agreement is held to be invalid, illegal or unenforceable in any
<PAGE>
Exhibit 5 Page 107 of 131 Pages
respect under any applicable law or rule in any jurisdiction,
such invalidity, illegality or unenforceability will not affect
any other provision or portion of any provision in such
jurisdiction, and this Agreement will be reformed, construed and
enforced in such jurisdiction as if such invalid, illegal or
unenforceable provision or portion of any provision had never
been contained herein.
IN WITNESS WHEREOF, the Parent, the Purchaser and the
Stockholder have caused this Agreement to be duly executed as of
the day and year first above written.
MCI COMMUNICATIONS CORPORATION
By: /s/ Susan Mayer
Name: Susan Mayer
Title: Senior Vice President
NTS ACQUISITION CORP.
By: /s/ Susan Mayer
Name: Susan Mayer
Title: Senior Vice President
MEL STEINBERG
/s/ Mel Steinberg
FOR PURPOSES OF SECTION 6 HEREOF,
ACKNOWLEDGED BY
NATIONWIDE CELLULAR SERVICE, INC.
By: /s/ Stephen Katz
Name: Stephen Katz
Title: Chief Executive Officer
<PAGE>
Exhibit 6 Page 108 of 131 Pages
VOTING AGREEMENT
VOTING AGREEMENT (this "Agreement"), dated as of May
22, 1995, among MCI COMMUNICATIONS CORPORATION, a Delaware
corporation (the "Parent"), NTS ACQUISITION CORP., a Delaware
corporation and an indirect, wholly owned subsidiary of the
Parent (the "Purchaser"), and LARRY ALTMAN (the "Stockholder").
RECITALS
Concurrently herewith, the Parent, the Purchaser and
Nationwide Cellular Service, Inc., a Delaware corporation (the
"Company"), are entering into an Agreement and Plan of Merger
dated the date hereof (the "Merger Agreement"; capitalized terms
used but not defined herein shall have the meanings set forth in
the Merger Agreement), pursuant to which the Purchaser will merge
with and into the Company (the "Merger"), and each share of
Common Stock, par value $.01 per share, of the Company (the
"Company Common Stock") issued and outstanding immediately prior
to the Effective Time (as defined in Section 1.3 of the Merger
Agreement) will be converted into the right to receive $18.50,
payable to the holder thereof, without interest (the "Merger
Consideration").
As of the date hereof, the Stockholder directly
beneficially owns 160,000 shares of Company Common Stock (the
"Existing Shares" and, together with any shares of Company Common
Stock acquired after the date hereof, whether upon the exercise
of options, conversion of convertible securities or otherwise,
the "Shares").
As a condition to their willingness to enter into the
Merger Agreement and to consummate the transactions contemplated
thereby, the Parent and the Purchaser have required that the
Stockholder agree (i) simultaneously with the execution of the
Merger Agreement, to execute and deliver this Agreement and (ii)
to grant a proxy to vote all of the Shares owned by the
Stockholder on the terms and conditions provided for herein.
AGREEMENT
To implement the foregoing and in consideration of the
mutual agreements contained herein, the parties agree as follows:
1. Agreement to Vote; Proxy. (a) The Stockholder, in
his capacity as such, hereby agrees that, during the time this
Agreement is in effect, at any meeting of the stockholders of the
Company, however called, or in connection with any written
consent of the stockholders of the Company, the Stockholder shall
<PAGE>
Exhibit 6 Page 109 of 131 Pages
vote (or cause to be voted) the Shares (i) in favor of the
Merger, the execution and delivery by the Company of the Merger
Agreement and the approval of the terms thereof and each of the
other actions contemplated by the Merger Agreement and this
Agreement; (ii) against any action or agreement that would result
in a breach in any material respect of any covenant,
representation or warranty or any other obligation or agreement
of the Company under the Merger Agreement or this Agreement; and
(iii) against any action or agreement (other than the Merger
Agreement or the transactions contemplated thereby) that is
intended, or could reasonably be expected, to impede, interfere
with, delay, postpone, discourage or materially adversely affect
the Merger, this Agreement or the Spin-Off Distribution (as
defined in Section 4.11 of the Merger Agreement), including, but
not limited to: (A) any extraordinary corporate transaction, such
as a merger, consolidation or other business combination
involving the Company or its subsidiaries; (B) a sale, lease or
transfer of a material amount of assets of the Company and its
subsidiaries or a reorganization, recapitalization or liquidation
of the Company or its subsidiaries; (C) any change in the
management or board of directors of the Company, except as
otherwise agreed to in writing by the Purchaser; (D) any material
change in the present capitalization or dividend policy of the
Company or any amendment of the Company's Certificate of
Incorporation; or (E) any other material change in the Company's
corporate structure or business. The Stockholder shall not enter
into any agreement or understanding with any person or entity
prior to the termination hereof to vote or give instructions
after the termination hereof in any manner inconsistent with
clauses (i), (ii) or (iii) of the preceding sentence.
(b) PROXY. THE STOCKHOLDER HEREBY GRANTS TO, AND
APPOINTS, THE PARENT AND THE SECRETARY OF THE PARENT AND THE
CHIEF FINANCIAL OFFICER OF THE PARENT, IN THEIR RESPECTIVE
CAPACITIES AS OFFICERS OF THE PARENT, AND ANY INDIVIDUAL WHO
SHALL HEREAFTER SUCCEED TO ANY SUCH OFFICE OF THE PARENT, AND ANY
OTHER DESIGNEE OF THE PARENT, EACH OF THEM INDIVIDUALLY, THE
STOCKHOLDER'S IRREVOCABLE PROXY AND ATTORNEY-IN-FACT (WITH FULL
POWER OF SUBSTITUTION) TO VOTE THE SHARES AS INDICATED IN SECTION
1(A). THE STOCKHOLDER INTENDS THIS PROXY TO BE IRREVOCABLE AND
COUPLED WITH AN INTEREST AND WILL TAKE SUCH FURTHER ACTION OR
EXECUTE SUCH OTHER INSTRUMENTS AS MAY BE NECESSARY TO EFFECTUATE
THE INTENT OF THIS PROXY AND HEREBY REVOKES ANY PROXY PREVIOUSLY
GRANTED BY HIM WITH RESPECT TO THE SHARES.
2. Expiration. This Agreement and the Parent's right
to vote the Shares covered hereby as set forth herein shall
terminate on the Expiration Date. As used herein, the term
"Expiration Date" means the first to occur of (a) the Effective
Time and (b) termination of the Merger Agreement in accordance
with its terms.
<PAGE>
Exhibit 6 Page 110 of 131 Pages
3. Representation and Warranties. (a) Representation
and Warranties of the Parent and the Purchaser. The Parent and
the Purchaser jointly and severally hereby represent and warrant
to the Stockholder as follows:
(i) Corporate Organization. Each of the Parent and
the Purchaser is a corporation duly organized, validly
existing and in good standing under the laws of the State of
Delaware and has the requisite corporate power and authority
and any necessary governmental authority to own, operate or
lease its properties and to carry on its business as it is
now being conducted, except where the failure to be so
organized, existing and in good standing or to have such
power, authority and governmental approvals could not,
individually or in the aggregate, reasonably be expected to
prevent the consummation of the Merger.
(ii) Authority Relative to Agreement. Each of the
Parent and the Purchaser has all necessary corporate power
and authority to enter into this Agreement, to perform its
obligations hereunder and to consummate the transactions
contemplated hereby. The execution, delivery and
performance of this Agreement by the Parent and the
Purchaser and, in the case of the Parent, subject to Section
5.2(f) of the Merger Agreement, the consummation by the
Parent and the Purchaser of the transactions contemplated
hereby have been duly authorized by all necessary corporate
action on the part of the Parent and the Purchaser. This
Agreement has been duly executed and delivered by each of
the Parent and the Purchaser and, assuming due
authorization, execution and delivery by the Stockholder,
constitutes a legal, valid and binding obligation of each
such corporation enforceable against such corporation in
accordance with its terms.
(iii) No Conflict. The execution, delivery and
performance of this Agreement by the Parent and the
Purchaser do not and will not: (A) conflict with or violate
the respective certificates of incorporation or by-laws of
the Parent or the Purchaser, as the case may be;
(B) assuming that all consents, approvals and authorizations
contemplated by Section 3.2(c)(ii) of the Merger Agreement
have been obtained and all filings described in such section
have been made, conflict with or violate any law, rule,
regulation, order, judgment or decree applicable to the
Parent or the Purchaser or by which either of them or their
respective properties are bound or affected; or (C) result
in any breach or violation of or constitute a default (or an
event which with notice or lapse of time or both could
become a default) or result in the loss of a material
benefit under, or give rise to any right of termination,
<PAGE>
Exhibit 6 Page 111 of 131 Pages
amendment, acceleration or cancellation of, or result in the
creation of a lien or encumbrance on any of the property or
assets of the Parent or the Purchaser pursuant to, any note,
bond, mortgage, indenture, contract, agreement, lease,
license, permit, franchise or other instrument or obligation
to which the Parent or the Purchaser is a party or by which
the Parent or the Purchaser or any of their respective
properties are bound or affected, except, in the case of
clauses (B) and (C), for any such conflicts, violations,
breaches, defaults or other occurrences which could not,
individually or in the aggregate, reasonably be expected to
prevent the consummation of the Merger.
(b) Representations and Warranties of the Stockholder.
The Stockholder hereby represents and warrants to the Parent and
the Purchaser as follows:
(i) Ownership of Shares. On the date hereof, the
Existing Shares are owned of record or beneficially by the
Stockholder, and, on the date hereof, the Existing Shares
constitute all of the shares of Company Common Stock owned
of record or beneficially by the Stockholder other than
beneficially through the ownership of Options. The
Stockholder has sole voting power and sole power of
disposition with respect to all of the Existing Shares, with
no restrictions, subject to applicable federal securities
laws, on the Stockholder's rights of disposition pertaining
thereto.
(ii) Power; Binding Agreement. The Stockholder has the
legal capacity, power and authority to enter into and
perform all of his obligations under this Agreement. The
execution, delivery and performance of this Agreement by the
Stockholder will not violate any other agreement to which
the Stockholder is a party including, without limitation,
any voting agreement, stockholders agreement or voting
trust. This Agreement has been duly executed and delivered
by the Stockholder and, assuming due authorization,
execution and delivery by the Parent and the Purchaser,
constitutes a legal, valid and binding obligation of the
Stockholder enforceable against the Stockholder in
accordance with its terms.
(iii) No Conflict. The execution, delivery and
performance of this Agreement by the Stockholder do not and
will not: (A) conflict with or violate any law, rule,
regulation, order, judgment or decree applicable to the
Stockholder or by which the Stockholder or his properties
are bound or affected; or (B) result in any breach or
violation of or constitute a default (or an event which with
notice or lapse of time or both could become a default) or
<PAGE>
Exhibit 6 Page 112 of 131 Pages
result in the loss of a material benefit under, or give rise
to any right of termination, amendment, acceleration or
cancellation of, or result in the creation of a lien or
encumbrance on any of the property or assets of the
Stockholder pursuant to, any note, bond, mortgage,
indenture, contract, agreement, lease, license, permit,
franchise or other instrument or obligation to which the
Stockholder is a party or by which the Stockholder or any of
his properties are bound or affected.
4. Certain Covenants of the Stockholder. In
accordance with the terms of this Agreement, the Stockholder, in
his capacity as such, hereby covenants and agrees as follows:
(a) No Solicitation. The Stockholder shall not, while
this Agreement is in effect, and shall not authorize or
permit any investment banker, financial advisor, attorney,
accountant or other representative retained by him to,
solicit, encourage (including by way of furnishing
information), or take any other action to facilitate, any
inquiries or the making of any proposal which constitutes,
or may reasonably be expected to lead to, any Takeover
Proposal (as defined in the Merger Agreement), or agree to
or endorse any Takeover Proposal. If the Stockholder
receives or becomes aware of a Takeover Proposal, then the
Stockholder shall promptly inform the Parent of the terms
and conditions of such proposal and the identity of the
person making it. The Stockholder will immediately cease
and cause to be terminated any existing activities,
discussions or negotiations to which he is a party in his
capacity as a stockholder of the Company with any parties
conducted heretofore with respect to any of the foregoing.
(b) Restriction on Transfer, Proxies and Non-
Interference. The Stockholder hereby agrees, while this
Agreement is in effect, and except as contemplated hereby,
not to (i) sell, transfer, pledge, encumber, assign or
otherwise dispose of, enforce or permit the execution of the
provisions of any redemption agreement with the Company or
enter into any contract, option or other arrangement or
understanding with respect to or consent to the offer for
sale, sale, transfer, pledge, encumbrance, assignment or
other disposition of, any of the Existing Shares or Shares
acquired after the date hereof, or any interest in any of
the foregoing, (ii) grant any proxies or powers of attorney,
deposit any Shares into a voting trust or enter into a
voting agreement with respect to any Shares or (iii) take
any action that would make any representation or warranty of
the Stockholder contained herein untrue or incorrect or have
the effect of preventing or disabling the Stockholder from
performing his obligations under this Agreement.
<PAGE>
Exhibit 6 Page 113 of 131 Pages
(c) Additional Shares. The Stockholder hereby agrees,
while this Agreement is in effect, to promptly notify the
Parent of the number of any new Shares of Company Common
Stock acquired by the Stockholder, if any, after the date
hereof.
5. Further Assurances. From time to time, at the
other party's request and without further consideration,
each party hereto shall execute and deliver such additional
documents and take all such further action as may be
necessary or desirable to consummate and make effective, in
the most expeditious manner practicable, the transactions
contemplated by this Agreement.
6. Stop Transfer Order. In furtherance of this
Agreement, concurrently herewith, the Stockholder shall and
hereby does authorize the Company's counsel to notify the
Company's transfer agent that there is a stop transfer order with
respect to all of the Existing Shares (and that this Agreement
places limits on the voting and transfer of such shares).
7. Miscellaneous. (a) Entire Agreement; Assignment.
This Agreement (i) constitutes the entire agreement among the
parties with respect to the subject matter hereof and supersedes
all other prior agreements and understandings, both written and
oral, between the parties with respect to the subject matter
hereof and (ii) shall not be assigned by operation of law or
otherwise, provided that the Parent may assign its rights and
obligations hereunder to any direct or indirect wholly owned
subsidiary of the Parent, but no such assignment shall relieve
the Parent of its obligations hereunder if such assignee does not
perform such obligations.
(b) Amendments. 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.
(c) Notices. All notices, requests, claims, demands
and other communications hereunder shall be in writing and shall
be given (and shall be deemed to have been duly received if so
given) by hand delivery, telegram, telex or telecopy, or by mail
(registered or certified mail, postage prepaid, return receipt
requested) or by any courier service, such as Federal Express,
providing proof of delivery. All communications hereunder shall
be delivered to the respective parties at the following
addresses:
If to the
Stockholder: Larry Altman
c/o Nationwide Cellular Service, Inc.
20 East Sunrise Highway
<PAGE>
Exhibit 6 Page 114 of 131 Pages
Valley Stream, New York 11582
If to the
Parent or
the Purchaser: MCI Communications Corporation
1801 Pennsylvania Avenue, N.W.
Washington, D.C. 20006
Attention: General Counsel
copy to: Simpson Thacher & Bartlett
425 Lexington Avenue
New York, New York 10017
Attention: Richard Capelouto, Esq.
or to such other address as the person to whom notice is given
may have previously furnished to the others in writing in the
manner set forth above.
(d) Governing Law. This Agreement shall be governed
by and construed in accordance with the laws of the State of
Delaware, regardless of the laws that might otherwise govern
under applicable principles of conflicts of laws thereof.
(e) Specific Performance. Each of the parties hereto
recognizes and acknowledges that a breach by it of any covenants
or agreements contained in this Agreement will cause the other
party to sustain damages for which it would not have an adequate
remedy at law for money damages, and therefore each of the
parties hereto agrees that in the event of any such breach the
aggrieved party shall be entitled to the remedy of specific
performance of such covenants and agreements and injunctive and
other equitable relief in addition to any other remedy to which
it may be entitled, at law or in equity.
(f) Counterparts. This Agreement may be executed in
two counterparts, each of which shall be deemed to be an
original, but both of which shall constitute one and the same
Agreement.
(g) Descriptive Headings. The descriptive headings
used herein are inserted for convenience of reference only and
are not intended to be part of or to affect the meaning or
interpretation of this Agreement.
(h) Severability. Whenever possible, each provision
or portion of any provision of this Agreement will be interpreted
in such manner as to be effective and valid under applicable law
but if any provision or portion of any provision of this
Agreement is held to be invalid, illegal or unenforceable in any
<PAGE>
Exhibit 6 Page 115 of 131 Pages
respect under any applicable law or rule in any jurisdiction,
such invalidity, illegality or unenforceability will not affect
any other provision or portion of any provision in such
jurisdiction, and this Agreement will be reformed, construed and
enforced in such jurisdiction as if such invalid, illegal or
unenforceable provision or portion of any provision had never
been contained herein.
IN WITNESS WHEREOF, the Parent, the Purchaser and the
Stockholder have caused this Agreement to be duly executed as of
the day and year first above written.
MCI COMMUNICATIONS CORPORATION
By: /s/ Susan Mayer
Name: Susan Mayer
Title: Senior Vice President
NTS ACQUISITION CORP.
By: /s/ Susan Mayer
Name: Susan Mayer
Title: Senior Vice President
LARRY ALTMAN
/s/ Larry Altman
FOR PURPOSES OF SECTION 6 HEREOF,
ACKNOWLEDGED BY
NATIONWIDE CELLULAR SERVICE, INC.
By: /s/ Stephen Katz
Name: Stephen Katz
Title: Chief Executive Officer
<PAGE>
Exhibit 7 Page 116 of 131 Pages
VOTING AGREEMENT
VOTING AGREEMENT (this "Agreement"), dated as of May
22, 1995, among MCI COMMUNICATIONS CORPORATION, a Delaware
corporation (the "Parent"), NTS ACQUISITION CORP., a Delaware
corporation and an indirect, wholly owned subsidiary of the
Parent (the "Purchaser"), and JEROME SANDERS (the "Stockholder").
RECITALS
Concurrently herewith, the Parent, the Purchaser and
Nationwide Cellular Service, Inc., a Delaware corporation (the
"Company"), are entering into an Agreement and Plan of Merger
dated the date hereof (the "Merger Agreement"; capitalized terms
used but not defined herein shall have the meanings set forth in
the Merger Agreement), pursuant to which the Purchaser will merge
with and into the Company (the "Merger"), and each share of
Common Stock, par value $.01 per share, of the Company (the
"Company Common Stock") issued and outstanding immediately prior
to the Effective Time (as defined in Section 1.3 of the Merger
Agreement) will be converted into the right to receive $18.50,
payable to the holder thereof, without interest (the "Merger
Consideration").
As of the date hereof, the Stockholder directly
beneficially owns 53,000 shares of Company Common Stock (the
"Existing Shares" and, together with any shares of Company Common
Stock acquired after the date hereof, whether upon the exercise
of options, conversion of convertible securities or otherwise,
the "Shares").
As a condition to their willingness to enter into the
Merger Agreement and to consummate the transactions contemplated
thereby, the Parent and the Purchaser have required that the
Stockholder agree (i) simultaneously with the execution of the
Merger Agreement, to execute and deliver this Agreement and (ii)
to grant a proxy to vote all of the Shares owned by the
Stockholder on the terms and conditions provided for herein.
AGREEMENT
To implement the foregoing and in consideration of the
mutual agreements contained herein, the parties agree as follows:
1. Agreement to Vote; Proxy. (a) The Stockholder, in
his capacity as such, hereby agrees that, during the time this
Agreement is in effect, at any meeting of the stockholders of the
Company, however called, or in connection with any written
consent of the stockholders of the Company, the Stockholder shall
vote (or cause to be voted) the Shares (i) in favor of the
<PAGE>
Exhibit 7 Page 117 of 131 Pages
Merger, the execution and delivery by the Company of the Merger
Agreement and the approval of the terms thereof and each of the
other actions contemplated by the Merger Agreement and this
Agreement; (ii) against any action or agreement that would result
in a breach in any material respect of any covenant,
representation or warranty or any other obligation or agreement
of the Company under the Merger Agreement or this Agreement; and
(iii) against any action or agreement (other than the Merger
Agreement or the transactions contemplated thereby) that is
intended, or could reasonably be expected, to impede, interfere
with, delay, postpone, discourage or materially adversely affect
the Merger, this Agreement or the Spin-Off Distribution (as
defined in Section 4.11 of the Merger Agreement), including, but
not limited to: (A) any extraordinary corporate transaction, such
as a merger, consolidation or other business combination
involving the Company or its subsidiaries; (B) a sale, lease or
transfer of a material amount of assets of the Company and its
subsidiaries or a reorganization, recapitalization or liquidation
of the Company or its subsidiaries; (C) any change in the
management or board of directors of the Company, except as
otherwise agreed to in writing by the Purchaser; (D) any material
change in the present capitalization or dividend policy of the
Company or any amendment of the Company's Certificate of
Incorporation; or (E) any other material change in the Company's
corporate structure or business. The Stockholder shall not enter
into any agreement or understanding with any person or entity
prior to the termination hereof to vote or give instructions
after the termination hereof in any manner inconsistent with
clauses (i), (ii) or (iii) of the preceding sentence.
(b) PROXY. THE STOCKHOLDER HEREBY GRANTS TO, AND
APPOINTS, THE PARENT AND THE SECRETARY OF THE PARENT AND THE
CHIEF FINANCIAL OFFICER OF THE PARENT, IN THEIR RESPECTIVE
CAPACITIES AS OFFICERS OF THE PARENT, AND ANY INDIVIDUAL WHO
SHALL HEREAFTER SUCCEED TO ANY SUCH OFFICE OF THE PARENT, AND ANY
OTHER DESIGNEE OF THE PARENT, EACH OF THEM INDIVIDUALLY, THE
STOCKHOLDER'S IRREVOCABLE PROXY AND ATTORNEY-IN-FACT (WITH FULL
POWER OF SUBSTITUTION) TO VOTE THE SHARES AS INDICATED IN SECTION
1(A). THE STOCKHOLDER INTENDS THIS PROXY TO BE IRREVOCABLE AND
COUPLED WITH AN INTEREST AND WILL TAKE SUCH FURTHER ACTION OR
EXECUTE SUCH OTHER INSTRUMENTS AS MAY BE NECESSARY TO EFFECTUATE
THE INTENT OF THIS PROXY AND HEREBY REVOKES ANY PROXY PREVIOUSLY
GRANTED BY HIM WITH RESPECT TO THE SHARES.
2. Expiration. This Agreement and the Parent's right
to vote the Shares covered hereby as set forth herein shall
terminate on the Expiration Date. As used herein, the term
"Expiration Date" means the first to occur of (a) the Effective
Time and (b) termination of the Merger Agreement in accordance
with its terms.
<PAGE>
Exhibit 7 Page 118 of 131 Pages
3. Representation and Warranties. (a) Representation
and Warranties of the Parent and the Purchaser. The Parent and
the Purchaser jointly and severally hereby represent and warrant
to the Stockholder as follows:
(i) Corporate Organization. Each of the Parent and
the Purchaser is a corporation duly organized, validly
existing and in good standing under the laws of the State of
Delaware and has the requisite corporate power and authority
and any necessary governmental authority to own, operate or
lease its properties and to carry on its business as it is
now being conducted, except where the failure to be so
organized, existing and in good standing or to have such
power, authority and governmental approvals could not,
individually or in the aggregate, reasonably be expected to
prevent the consummation of the Merger.
(ii) Authority Relative to Agreement. Each of the
Parent and the Purchaser has all necessary corporate power
and authority to enter into this Agreement, to perform its
obligations hereunder and to consummate the transactions
contemplated hereby. The execution, delivery and
performance of this Agreement by the Parent and the
Purchaser and, in the case of the Parent, subject to Section
5.2(f) of the Merger Agreement, the consummation by the
Parent and the Purchaser of the transactions contemplated
hereby have been duly authorized by all necessary corporate
action on the part of the Parent and the Purchaser. This
Agreement has been duly executed and delivered by each of
the Parent and the Purchaser and, assuming due
authorization, execution and delivery by the Stockholder,
constitutes a legal, valid and binding obligation of each
such corporation enforceable against such corporation in
accordance with its terms.
(iii) No Conflict. The execution, delivery and
performance of this Agreement by the Parent and the
Purchaser do not and will not: (A) conflict with or violate
the respective certificates of incorporation or by-laws of
the Parent or the Purchaser, as the case may be;
(B) assuming that all consents, approvals and authorizations
contemplated by Section 3.2(c)(ii) of the Merger Agreement
have been obtained and all filings described in such section
have been made, conflict with or violate any law, rule,
regulation, order, judgment or decree applicable to the
Parent or the Purchaser or by which either of them or their
respective properties are bound or affected; or (C) result
in any breach or violation of or constitute a default (or an
event which with notice or lapse of time or both could
become a default) or result in the loss of a material
benefit under, or give rise to any right of termination,
<PAGE>
Exhibit 7 Page 119 of 131 Pages
amendment, acceleration or cancellation of, or result in the
creation of a lien or encumbrance on any of the property or
assets of the Parent or the Purchaser pursuant to, any note,
bond, mortgage, indenture, contract, agreement, lease,
license, permit, franchise or other instrument or obligation
to which the Parent or the Purchaser is a party or by which
the Parent or the Purchaser or any of their respective
properties are bound or affected, except, in the case of
clauses (B) and (C), for any such conflicts, violations,
breaches, defaults or other occurrences which could not,
individually or in the aggregate, reasonably be expected to
prevent the consummation of the Merger.
(b) Representations and Warranties of the Stockholder.
The Stockholder hereby represents and warrants to the Parent and
the Purchaser as follows:
(i) Ownership of Shares. On the date hereof, the
Existing Shares are owned of record or beneficially by the
Stockholder, and, on the date hereof, the Existing Shares
constitute all of the shares of Company Common Stock owned
of record or beneficially by the Stockholder other than
beneficially through the ownership of Options. The
Stockholder has sole voting power and sole power of
disposition with respect to all of the Existing Shares, with
no restrictions, subject to applicable federal securities
laws, on the Stockholder's rights of disposition pertaining
thereto.
(ii) Power; Binding Agreement. The Stockholder has the
legal capacity, power and authority to enter into and
perform all of his obligations under this Agreement. The
execution, delivery and performance of this Agreement by the
Stockholder will not violate any other agreement to which
the Stockholder is a party including, without limitation,
any voting agreement, stockholders agreement or voting
trust. This Agreement has been duly executed and delivered
by the Stockholder and, assuming due authorization,
execution and delivery by the Parent and the Purchaser,
constitutes a legal, valid and binding obligation of the
Stockholder enforceable against the Stockholder in
accordance with its terms.
(iii) No Conflict. The execution, delivery and
performance of this Agreement by the Stockholder do not and
will not: (A) conflict with or violate any law, rule,
regulation, order, judgment or decree applicable to the
Stockholder or by which the Stockholder or his properties
are bound or affected; or (B) result in any breach or
violation of or constitute a default (or an event which with
notice or lapse of time or both could become a default) or
<PAGE>
Exhibit 7 Page 120 of 131 Pages
result in the loss of a material benefit under, or give rise
to any right of termination, amendment, acceleration or
cancellation of, or result in the creation of a lien or
encumbrance on any of the property or assets of the
Stockholder pursuant to, any note, bond, mortgage,
indenture, contract, agreement, lease, license, permit,
franchise or other instrument or obligation to which the
Stockholder is a party or by which the Stockholder or any of
his properties are bound or affected.
4. Certain Covenants of the Stockholder. In
accordance with the terms of this Agreement, the Stockholder, in
his capacity as such, hereby covenants and agrees as follows:
(a) No Solicitation. The Stockholder shall not, while
this Agreement is in effect, and shall not authorize or
permit any investment banker, financial advisor, attorney,
accountant or other representative retained by him to,
solicit, encourage (including by way of furnishing
information), or take any other action to facilitate, any
inquiries or the making of any proposal which constitutes,
or may reasonably be expected to lead to, any Takeover
Proposal (as defined in the Merger Agreement), or agree to
or endorse any Takeover Proposal. If the Stockholder
receives or becomes aware of a Takeover Proposal, then the
Stockholder shall promptly inform the Parent of the terms
and conditions of such proposal and the identity of the
person making it. The Stockholder will immediately cease
and cause to be terminated any existing activities,
discussions or negotiations to which he is a party in his
capacity as a stockholder of the Company with any parties
conducted heretofore with respect to any of the foregoing.
(b) Restriction on Transfer, Proxies and Non-
Interference. The Stockholder hereby agrees, while this
Agreement is in effect, and except as contemplated hereby,
not to (i) sell, transfer, pledge, encumber, assign or
otherwise dispose of, enforce or permit the execution of the
provisions of any redemption agreement with the Company or
enter into any contract, option or other arrangement or
understanding with respect to or consent to the offer for
sale, sale, transfer, pledge, encumbrance, assignment or
other disposition of, any of the Existing Shares or Shares
acquired after the date hereof, or any interest in any of
the foregoing, (ii) grant any proxies or powers of attorney,
deposit any Shares into a voting trust or enter into a
voting agreement with respect to any Shares or (iii) take
any action that would make any representation or warranty of
the Stockholder contained herein untrue or incorrect or have
the effect of preventing or disabling the Stockholder from
performing his obligations under this Agreement.
<PAGE>
Exhibit 7 Page 121 of 131 Pages
(c) Additional Shares. The Stockholder hereby agrees,
while this Agreement is in effect, to promptly notify the
Parent of the number of any new Shares of Company Common
Stock acquired by the Stockholder, if any, after the date
hereof.
5. Further Assurances. From time to time, at the
other party's request and without further consideration,
each party hereto shall execute and deliver such additional
documents and take all such further action as may be
necessary or desirable to consummate and make effective, in
the most expeditious manner practicable, the transactions
contemplated by this Agreement.
6. Stop Transfer Order. In furtherance of this
Agreement, concurrently herewith, the Stockholder shall and
hereby does authorize the Company's counsel to notify the
Company's transfer agent that there is a stop transfer order with
respect to all of the Existing Shares (and that this Agreement
places limits on the voting and transfer of such shares).
7. Miscellaneous. (a) Entire Agreement; Assignment.
This Agreement (i) constitutes the entire agreement among the
parties with respect to the subject matter hereof and supersedes
all other prior agreements and understandings, both written and
oral, between the parties with respect to the subject matter
hereof and (ii) shall not be assigned by operation of law or
otherwise, provided that the Parent may assign its rights and
obligations hereunder to any direct or indirect wholly owned
subsidiary of the Parent, but no such assignment shall relieve
the Parent of its obligations hereunder if such assignee does not
perform such obligations.
(b) Amendments. 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.
(c) Notices. All notices, requests, claims, demands
and other communications hereunder shall be in writing and shall
be given (and shall be deemed to have been duly received if so
given) by hand delivery, telegram, telex or telecopy, or by mail
(registered or certified mail, postage prepaid, return receipt
requested) or by any courier service, such as Federal Express,
providing proof of delivery. All communications hereunder shall
be delivered to the respective parties at the following
addresses:
If to the
Stockholder: Jerome Sanders
c/o Nationwide Cellular Service, Inc.
20 East Sunrise Highway
<PAGE>
Exhibit 7 Page 122 of 131 Pages
Valley Stream, New York 11582
If to the
Parent or
the Purchaser: MCI Communications Corporation
1801 Pennsylvania Avenue, N.W.
Washington, D.C. 20006
Attention: General Counsel
copy to: Simpson Thacher & Bartlett
425 Lexington Avenue
New York, New York 10017
Attention: Richard Capelouto, Esq.
or to such other address as the person to whom notice is given
may have previously furnished to the others in writing in the
manner set forth above.
(d) Governing Law. This Agreement shall be governed
by and construed in accordance with the laws of the State of
Delaware, regardless of the laws that might otherwise govern
under applicable principles of conflicts of laws thereof.
(e) Specific Performance. Each of the parties hereto
recognizes and acknowledges that a breach by it of any covenants
or agreements contained in this Agreement will cause the other
party to sustain damages for which it would not have an adequate
remedy at law for money damages, and therefore each of the
parties hereto agrees that in the event of any such breach the
aggrieved party shall be entitled to the remedy of specific
performance of such covenants and agreements and injunctive and
other equitable relief in addition to any other remedy to which
it may be entitled, at law or in equity.
(f) Counterparts. This Agreement may be executed in
two counterparts, each of which shall be deemed to be an
original, but both of which shall constitute one and the same
Agreement.
(g) Descriptive Headings. The descriptive headings
used herein are inserted for convenience of reference only and
are not intended to be part of or to affect the meaning or
interpretation of this Agreement.
(h) Severability. Whenever possible, each provision
or portion of any provision of this Agreement will be interpreted
in such manner as to be effective and valid under applicable law
but if any provision or portion of any provision of this
Agreement is held to be invalid, illegal or unenforceable in any
<PAGE>
Exhibit 7 Page 123 of 131 Pages
respect under any applicable law or rule in any jurisdiction,
such invalidity, illegality or unenforceability will not affect
any other provision or portion of any provision in such
jurisdiction, and this Agreement will be reformed, construed and
enforced in such jurisdiction as if such invalid, illegal or
unenforceable provision or portion of any provision had never
been contained herein.
IN WITNESS WHEREOF, the Parent, the Purchaser and the
Stockholder have caused this Agreement to be duly executed as of
the day and year first above written.
MCI COMMUNICATIONS CORPORATION
By: /s/ Susan Mayer
Name: Susan Mayer
Title: Senior Vice President
NTS ACQUISITION CORP.
By: /s/ Susan Mayer
Name: Susan Mayer
Title: Senior Vice President
JEROME SANDERS
/s/ Jerome Sanders
FOR PURPOSES OF SECTION 6 HEREOF,
ACKNOWLEDGED BY
NATIONWIDE CELLULAR SERVICE, INC.
By: /s/ Stephen Katz
Name: Stephen Katz
Title: Chief Executive Officer
<PAGE>
Exhibit 8 Page 124 of 131 Pages
VOTING AGREEMENT
VOTING AGREEMENT (this "Agreement"), dated as of May
22, 1995, among MCI COMMUNICATIONS CORPORATION, a Delaware
corporation (the "Parent"), NTS ACQUISITION CORP., a Delaware
corporation and an indirect, wholly owned subsidiary of the
Parent (the "Purchaser"), and JOSEPH A. GREGORI (the
"Stockholder").
RECITALS
Concurrently herewith, the Parent, the Purchaser and
Nationwide Cellular Service, Inc., a Delaware corporation (the
"Company"), are entering into an Agreement and Plan of Merger
dated the date hereof (the "Merger Agreement"; capitalized terms
used but not defined herein shall have the meanings set forth in
the Merger Agreement), pursuant to which the Purchaser will merge
with and into the Company (the "Merger"), and each share of
Common Stock, par value $.01 per share, of the Company (the
"Company Common Stock") issued and outstanding immediately prior
to the Effective Time (as defined in Section 1.3 of the Merger
Agreement) will be converted into the right to receive $18.50,
payable to the holder thereof, without interest (the "Merger
Consideration").
As of the date hereof, the Stockholder directly
beneficially owns 128,000 shares of Company Common Stock
(together with any shares of Company Common Stock acquired after
the date hereof, whether upon the exercise of options, conversion
of convertible securities or otherwise, the "Shares"), which
represent shares issuable upon exercise of options.
As a condition to their willingness to enter into the
Merger Agreement and to consummate the transactions contemplated
thereby, the Parent and the Purchaser have required that the
Stockholder agree (i) simultaneously with the execution of the
Merger Agreement, to execute and deliver this Agreement and (ii)
to grant a proxy to vote all of the Shares owned by the
Stockholder on the terms and conditions provided for herein.
AGREEMENT
To implement the foregoing and in consideration of the
mutual agreements contained herein, the parties agree as follows:
1. Agreement to Vote; Proxy. (a) The Stockholder, in
his capacity as such, hereby agrees that, during the time this
Agreement is in effect, at any meeting of the stockholders of the
Company, however called, or in connection with any written
consent of the stockholders of the Company, the Stockholder shall
<PAGE>
Exhibit 8 Page 125 of 131 Pages
vote (or cause to be voted) the Shares (i) in favor of the
Merger, the execution and delivery by the Company of the Merger
Agreement and the approval of the terms thereof and each of the
other actions contemplated by the Merger Agreement and this
Agreement; (ii) against any action or agreement that would result
in a breach in any material respect of any covenant,
representation or warranty or any other obligation or agreement
of the Company under the Merger Agreement or this Agreement; and
(iii) against any action or agreement (other than the Merger
Agreement or the transactions contemplated thereby) that is
intended, or could reasonably be expected, to impede, interfere
with, delay, postpone, discourage or materially adversely affect
the Merger, this Agreement or the Spin-Off Distribution (as
defined in Section 4.11 of the Merger Agreement), including, but
not limited to: (A) any extraordinary corporate transaction, such
as a merger, consolidation or other business combination
involving the Company or its subsidiaries; (B) a sale, lease or
transfer of a material amount of assets of the Company and its
subsidiaries or a reorganization, recapitalization or liquidation
of the Company or its subsidiaries; (C) any change in the
management or board of directors of the Company, except as
otherwise agreed to in writing by the Purchaser; (D) any material
change in the present capitalization or dividend policy of the
Company or any amendment of the Company's Certificate of
Incorporation; or (E) any other material change in the Company's
corporate structure or business. The Stockholder shall not enter
into any agreement or understanding with any person or entity
prior to the termination hereof to vote or give instructions
after the termination hereof in any manner inconsistent with
clauses (i), (ii) or (iii) of the preceding sentence.
(b) PROXY. THE STOCKHOLDER HEREBY GRANTS TO, AND
APPOINTS, THE PARENT AND THE SECRETARY OF THE PARENT AND THE
CHIEF FINANCIAL OFFICER OF THE PARENT, IN THEIR RESPECTIVE
CAPACITIES AS OFFICERS OF THE PARENT, AND ANY INDIVIDUAL WHO
SHALL HEREAFTER SUCCEED TO ANY SUCH OFFICE OF THE PARENT, AND ANY
OTHER DESIGNEE OF THE PARENT, EACH OF THEM INDIVIDUALLY, THE
STOCKHOLDER'S IRREVOCABLE PROXY AND ATTORNEY-IN-FACT (WITH FULL
POWER OF SUBSTITUTION) TO VOTE THE SHARES AS INDICATED IN SECTION
1(A). THE STOCKHOLDER INTENDS THIS PROXY TO BE IRREVOCABLE AND
COUPLED WITH AN INTEREST AND WILL TAKE SUCH FURTHER ACTION OR
EXECUTE SUCH OTHER INSTRUMENTS AS MAY BE NECESSARY TO EFFECTUATE
THE INTENT OF THIS PROXY AND HEREBY REVOKES ANY PROXY PREVIOUSLY
GRANTED BY HIM WITH RESPECT TO THE SHARES.
2. Expiration. This Agreement and the Parent's right
to vote the Shares covered hereby as set forth herein shall
terminate on the Expiration Date. As used herein, the term
"Expiration Date" means the first to occur of (a) the Effective
Time and (b) termination of the Merger Agreement in accordance
with its terms.
<PAGE>
Exhibit 8 Page 126 of 131 Pages
3. Representation and Warranties. (a) Representation
and Warranties of the Parent and the Purchaser. The Parent and
the Purchaser jointly and severally hereby represent and warrant
to the Stockholder as follows:
(i) Corporate Organization. Each of the Parent and
the Purchaser is a corporation duly organized, validly
existing and in good standing under the laws of the State of
Delaware and has the requisite corporate power and authority
and any necessary governmental authority to own, operate or
lease its properties and to carry on its business as it is
now being conducted, except where the failure to be so
organized, existing and in good standing or to have such
power, authority and governmental approvals could not,
individually or in the aggregate, reasonably be expected to
prevent the consummation of the Merger.
(ii) Authority Relative to Agreement. Each of the
Parent and the Purchaser has all necessary corporate power
and authority to enter into this Agreement, to perform its
obligations hereunder and to consummate the transactions
contemplated hereby. The execution, delivery and
performance of this Agreement by the Parent and the
Purchaser and, in the case of the Parent, subject to Section
5.2(f) of the Merger Agreement, the consummation by the
Parent and the Purchaser of the transactions contemplated
hereby have been duly authorized by all necessary corporate
action on the part of the Parent and the Purchaser. This
Agreement has been duly executed and delivered by each of
the Parent and the Purchaser and, assuming due
authorization, execution and delivery by the Stockholder,
constitutes a legal, valid and binding obligation of each
such corporation enforceable against such corporation in
accordance with its terms.
(iii) No Conflict. The execution, delivery and
performance of this Agreement by the Parent and the
Purchaser do not and will not: (A) conflict with or violate
the respective certificates of incorporation or by-laws of
the Parent or the Purchaser, as the case may be;
(B) assuming that all consents, approvals and authorizations
contemplated by Section 3.2(c)(ii) of the Merger Agreement
have been obtained and all filings described in such section
have been made, conflict with or violate any law, rule,
regulation, order, judgment or decree applicable to the
Parent or the Purchaser or by which either of them or their
respective properties are bound or affected; or (C) result
in any breach or violation of or constitute a default (or an
event which with notice or lapse of time or both could
become a default) or result in the loss of a material
benefit under, or give rise to any right of termination,
<PAGE>
Exhibit 8 Page 127 of 131 Pages
amendment, acceleration or cancellation of, or result in the
creation of a lien or encumbrance on any of the property or
assets of the Parent or the Purchaser pursuant to, any note,
bond, mortgage, indenture, contract, agreement, lease,
license, permit, franchise or other instrument or obligation
to which the Parent or the Purchaser is a party or by which
the Parent or the Purchaser or any of their respective
properties are bound or affected, except, in the case of
clauses (B) and (C), for any such conflicts, violations,
breaches, defaults or other occurrences which could not,
individually or in the aggregate, reasonably be expected to
prevent the consummation of the Merger.
(b) Representations and Warranties of the Stockholder.
The Stockholder hereby represents and warrants to the Parent and
the Purchaser as follows:
(i) Ownership of Shares. On the date hereof, the
Shares are owned of record or beneficially by the
Stockholder, and, on the date hereof, the Shares constitute
all of the shares of Company Common Stock owned of record or
beneficially by the Stockholder. The Stockholder has sole
voting power, if any, and sole power of disposition with
respect to all of the Shares, with no restrictions, subject
to applicable federal securities laws, on the Stockholder's
rights of disposition pertaining thereto.
(ii) Power; Binding Agreement. The Stockholder has the
legal capacity, power and authority to enter into and
perform all of his obligations under this Agreement. The
execution, delivery and performance of this Agreement by the
Stockholder will not violate any other agreement to which
the Stockholder is a party including, without limitation,
any voting agreement, stockholders agreement or voting
trust. This Agreement has been duly executed and delivered
by the Stockholder and, assuming due authorization,
execution and delivery by the Parent and the Purchaser,
constitutes a legal, valid and binding obligation of the
Stockholder enforceable against the Stockholder in
accordance with its terms.
(iii) No Conflict. The execution, delivery and
performance of this Agreement by the Stockholder do not and
will not: (A) conflict with or violate any law, rule,
regulation, order, judgment or decree applicable to the
Stockholder or by which the Stockholder or his properties
are bound or affected; or (B) result in any breach or
violation of or constitute a default (or an event which with
notice or lapse of time or both could become a default) or
result in the loss of a material benefit under, or give rise
to any right of termination, amendment, acceleration or
<PAGE>
Exhibit 8 Page 128 of 131 Pages
cancellation of, or result in the creation of a lien or
encumbrance on any of the property or assets of the
Stockholder pursuant to, any note, bond, mortgage,
indenture, contract, agreement, lease, license, permit,
franchise or other instrument or obligation to which the
Stockholder is a party or by which the Stockholder or any of
his properties are bound or affected.
4. Certain Covenants of the Stockholder. In
accordance with the terms of this Agreement, the Stockholder, in
his capacity as such, hereby covenants and agrees as follows:
(a) No Solicitation. The Stockholder shall not, while
this Agreement is in effect, and shall not authorize or
permit any investment banker, financial advisor, attorney,
accountant or other representative retained by him to,
solicit, encourage (including by way of furnishing
information), or take any other action to facilitate, any
inquiries or the making of any proposal which constitutes,
or may reasonably be expected to lead to, any Takeover
Proposal (as defined in the Merger Agreement), or agree to
or endorse any Takeover Proposal. If the Stockholder
receives or becomes aware of a Takeover Proposal, then the
Stockholder shall promptly inform the Parent of the terms
and conditions of such proposal and the identity of the
person making it. The Stockholder will immediately cease
and cause to be terminated any existing activities,
discussions or negotiations to which he is a party in his
capacity as a stockholder of the Company with any parties
conducted heretofore with respect to any of the foregoing.
(b) Restriction on Transfer, Proxies and Non-
Interference. The Stockholder hereby agrees, while this
Agreement is in effect, and except as contemplated hereby,
not to (i) sell, transfer, pledge, encumber, assign or
otherwise dispose of, enforce or permit the execution of the
provisions of any redemption agreement with the Company or
enter into any contract, option or other arrangement or
understanding with respect to or consent to the offer for
sale, sale, transfer, pledge, encumbrance, assignment or
other disposition of, any Shares acquired after the date
hereof, or any interest in any of the foregoing, (ii) grant
any proxies or powers of attorney, deposit any Shares into a
voting trust or enter into a voting agreement with respect
to any Shares or (iii) take any action that would make any
representation or warranty of the Stockholder contained
herein untrue or incorrect or have the effect of preventing
or disabling the Stockholder from performing his obligations
under this Agreement.
(c) Additional Shares. The Stockholder hereby agrees,
<PAGE>
Exhibit 8 Page 129 of 131 Pages
while this Agreement is in effect, to promptly notify the
Parent of the number of any new Shares of Company Common
Stock acquired by the Stockholder, if any, after the date
hereof.
5. Further Assurances. From time to time, at the
other party's request and without further consideration,
each party hereto shall execute and deliver such additional
documents and take all such further action as may be
necessary or desirable to consummate and make effective, in
the most expeditious manner practicable, the transactions
contemplated by this Agreement.
6. Stop Transfer Order. In furtherance of this
Agreement, concurrently herewith, the Stockholder shall and
hereby does authorize the Company's counsel to notify the
Company's transfer agent that there is a stop transfer order with
respect to all of the Shares (and that this Agreement places
limits on the voting and transfer of such shares).
7. Miscellaneous. (a) Entire Agreement; Assignment.
This Agreement (i) constitutes the entire agreement among the
parties with respect to the subject matter hereof and supersedes
all other prior agreements and understandings, both written and
oral, between the parties with respect to the subject matter
hereof and (ii) shall not be assigned by operation of law or
otherwise, provided that the Parent may assign its rights and
obligations hereunder to any direct or indirect wholly owned
subsidiary of the Parent, but no such assignment shall relieve
the Parent of its obligations hereunder if such assignee does not
perform such obligations.
(b) Amendments. 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.
(c) Notices. All notices, requests, claims, demands
and other communications hereunder shall be in writing and shall
be given (and shall be deemed to have been duly received if so
given) by hand delivery, telegram, telex or telecopy, or by mail
(registered or certified mail, postage prepaid, return receipt
requested) or by any courier service, such as Federal Express,
providing proof of delivery. All communications hereunder shall
be delivered to the respective parties at the following
addresses:
If to the
Stockholder: Joseph A. Gregori
c/o Nationwide Cellular Service, Inc.
20 East Sunrise Highway
Valley Stream, New York 11582
<PAGE>
Exhibit 8 Page 130 of 131 Pages
If to the
Parent or
the Purchaser: MCI Communications Corporation
1801 Pennsylvania Avenue, N.W.
Washington, D.C. 20006
Attention: General Counsel
copy to: Simpson Thacher & Bartlett
425 Lexington Avenue
New York, New York 10017
Attention: Richard Capelouto, Esq.
or to such other address as the person to whom notice is given
may have previously furnished to the others in writing in the
manner set forth above.
(d) Governing Law. This Agreement shall be governed
by and construed in accordance with the laws of the State of
Delaware, regardless of the laws that might otherwise govern
under applicable principles of conflicts of laws thereof.
(e) Specific Performance. Each of the parties hereto
recognizes and acknowledges that a breach by it of any covenants
or agreements contained in this Agreement will cause the other
party to sustain damages for which it would not have an adequate
remedy at law for money damages, and therefore each of the
parties hereto agrees that in the event of any such breach the
aggrieved party shall be entitled to the remedy of specific
performance of such covenants and agreements and injunctive and
other equitable relief in addition to any other remedy to which
it may be entitled, at law or in equity.
(f) Counterparts. This Agreement may be executed in
two counterparts, each of which shall be deemed to be an
original, but both of which shall constitute one and the same
Agreement.
(g) Descriptive Headings. The descriptive headings
used herein are inserted for convenience of reference only and
are not intended to be part of or to affect the meaning or
interpretation of this Agreement.
(h) Severability. Whenever possible, each provision
or portion of any provision of this Agreement will be interpreted
in such manner as to be effective and valid under applicable law
but if any provision or portion of any provision of this
Agreement is held to be invalid, illegal or unenforceable in any
respect under any applicable law or rule in any jurisdiction,
such invalidity, illegality or unenforceability will not affect
<PAGE>
Exhibit 8 Page 131 of 131 Pages
any other provision or portion of any provision in such
jurisdiction, and this Agreement will be reformed, construed and
enforced in such jurisdiction as if such invalid, illegal or
unenforceable provision or portion of any provision had never
been contained herein.
IN WITNESS WHEREOF, the Parent, the Purchaser and the
Stockholder have caused this Agreement to be duly executed as of
the day and year first above written.
MCI COMMUNICATIONS CORPORATION
By: /s/ Susan Mayer
Name: Susan Mayer
Title: Senior Vice President
NTS ACQUISITION CORP.
By: /s/ Susan Mayer
Name: Susan Mayer
Title: Senior Vice President
JOSEPH A. GREGORI
/s/ Joseph A. Gregori
FOR PURPOSES OF SECTION 6 HEREOF,
ACKNOWLEDGED BY
NATIONWIDE CELLULAR SERVICE, INC.
By: /s/ Stephen Katz
Name: Stephen Katz
Title: Chief Executive Officer
