<PAGE> 1
REGISTRATION NO. 33-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
-----------------------
FORM S-4
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
-----------------------
BELL ATLANTIC CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
<TABLE>
<S> <C> <C>
DELAWARE 4811 23-2259884
(STATE OR OTHER JURISDICTION (PRIMARY STANDARD (I.R.S. EMPLOYER
OF INCORPORATION OR INDUSTRIAL CLASSIFICATION IDENTIFICATION NUMBER)
ORGANIZATION) CODE NUMBER)
</TABLE>
-----------------------
1717 ARCH STREET
PHILADELPHIA, PENNSYLVANIA 19103
(215) 963-6000
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF
REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
ELLEN C. WOLF, VICE PRESIDENT - TREASURER
BELL ATLANTIC CORPORATION
1717 ARCH STREET
PHILADELPHIA, PENNSYLVANIA 19103
(215) 963-6800
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF AGENT FOR SERVICE)
-----------------------
Please send copies of all communications to:
P. ALAN BULLINER ROBERT HICKS
VICE PRESIDENT - CORPORATE SECRETARY AND COUNSEL SOMMER & BARNARD
BELL ATLANTIC CORPORATION 4000 BANK ONE TOWER
1717 ARCH STREET 111 MONUMENT CIRCLE
PHILADELPHIA, PENNSYLVANIA 19103 INDIANAPOLIS, INDIANA 46244
-----------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE: As soon as practicable
after the effective date of this Registration Statement and the effective time
of the merger (the "Merger") of a subsidiary of Bell Atlantic Corporation
("Bell Atlantic") and Howard W. Sams & Company ("Sams") as described in the
Agreement and Plan of Merger dated as of August 30, 1995.
-----------------------
IF THE SECURITIES BEING REGISTERED ON THIS FORM ARE BEING OFFERED IN CONNECTION
WITH THE FORMATION OF A HOLDING COMPANY AND THERE IS COMPLIANCE WITH GENERAL
INSTRUCTION G, CHECK THE FOLLOWING BOX. ___
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
===========================================================================================================================
PROPOSED PROPOSED
AMOUNT MAXIMUM AGGREGATE AMOUNT OF
TITLE OF EACH CLASS OF SECURITIES TO BE OFFERING PRICE MAXIMUM REGISTRATION
TO BE REGISTERED REGISTERED PER UNIT OFFERING PRICE FEE
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, par value
$1.00 per share 150,000 shares N/A $1,429,405 * $493
===========================================================================================================================
</TABLE>
* Estimated solely for the purpose of determining the registration fee,
required by Section 6(b) of the Securities Act of 1933, as amended (the
"Securities Act"), and calculated pursuant to Rule 457(f) under the Securities
Act. There is no market for the securities to be received by the registrant in
the transaction; as of July 30, 1995, the book value of such securities was
$1,429,405.
-----------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES
AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE
A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT
SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF THE
SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a),
MAY DETERMINE.
================================================================================
<PAGE> 2
BELL ATLANTIC CORPORATION
SHARES OF COMMON STOCK
TO BE ISSUED IN CONNECTION WITH THE MERGER OF
A WHOLLY OWNED SUBSIDIARY OF
BELL ATLANTIC CORPORATION
WITH AND INTO HOWARD W. SAMS & COMPANY
----------------------------
Cross-Reference Sheet Pursuant to Item 501(b) of Regulation S-K
<TABLE>
<CAPTION>
Item of Form S-4 Location or Caption in Prospectus
- ---------------- ---------------------------------
<S> <C>
A. INFORMATION ABOUT THE TRANSACTION
1. Forepart of Registration Statement and Outside Front
Cover Page of Prospectus . . . . . . . . . . . . . . Facing Page of the Registration Statement; Outside
Front Cover of Prospectus
2. Inside Front and Outside Back Cover Pages of
Prospectus . . . . . . . . . . . . . . . . . . . . . Inside Front Cover of Prospectus; Available
Information; Incorporation of Certain Documents by
Reference; Table of Contents
3. Risk Factors, Ratio of Earnings to Fixed Charges and
Other Information . . . . . . . . . . . . . . . . . . Summary; The Merger
4. Terms of the Transaction . . . . . . . . . . . . . . Summary; The Merger; Comparison of Rights of Holders
of Sams Common Stock and Bell Atlantic Common Stock
5. Pro Forma Financial Information . . . . . . . . . . . Not Applicable
6. Material Contracts with the Company Being Acquired . Summary; The Merger
7. Additional Information Required for Reoffering by
Persons and Parties Deemed to be Underwriters . . . . Not Applicable
8. Interests of Named Experts and Counsel . . . . . . . Independent Accountants; Legal Opinions
9. Disclosure of Commission Position on Indemnification
for Securities Act Liabilities . . . . . . . . . . . Not Applicable
B. INFORMATION ABOUT THE REGISTRANT
10. Information with Respect to S-3 Registrants . . . . . Available Information; Incorporation of Certain
Documents by Reference
</TABLE>
<PAGE> 3
<TABLE>
<S> <C>
11. Incorporation of Certain Information by Reference ... Available Information; Incorporation of Certain
Documents by Reference
12. Information with Respect to S-2 or S-3 Registrants .. Not Applicable
13. Incorporation of Certain Information by Reference ... Not Applicable
14. Information with Respect to Registrants Other Than S-3
or S-2 Registrants . . . . . . . . . . . . . . . . . Not Applicable
C. INFORMATION ABOUT THE COMPANY BEING ACQUIRED
15. Information with Respect to S-3 Companies . . . . . . Not Applicable
16. Information with Respect to S-2 or S-3 Companies . . . Not Applicable
17. Information with Respect to Companies Other Than S-3
or S-2 Companies . . . . . . . . . . . . . . . . . . Howard W. Sams & Company
D. VOTING AND MANAGEMENT INFORMATION
18. Information if Proxies, Consents or Authorizations are
to be Solicited . . . . . . . . . . . . . . . . . . . Not Applicable
19. Information if Proxies, Consents or Authorizations are
not to be Solicited or in an Exchange Offer . . . . . Summary; The Merger
</TABLE>
<PAGE> 4
BELL ATLANTIC CORPORATION
PROSPECTUS
This Prospectus is being furnished to the shareholders of Howard W.
Sams & Company ("Sams"), an Indiana corporation, in connection with an
Agreement and Plan of Merger by and among Sams, Damon C. Davis and Richard R.
Hauser (Messrs. Davis and Hauser are sometimes referred to individually as a
"Seller" and together as the "Sellers"), the sole shareholders of Sams, and
Bell Atlantic Ventures XXIX, Inc. ("Purchaser"), dated as of August 30, 1995
(the "Merger Agreement"), pursuant to which Purchaser, a wholly-owned
subsidiary of Bell Atlantic Corporation ("Bell Atlantic"), will be merged (the
"Merger") with and into Sams. In the Merger, and on the terms contained in the
Merger Agreement which are described in this Prospectus, all of the outstanding
shares of the common stock, no par value, of Sams ("Sams Common Stock") will be
converted, in accordance with the Merger Agreement, into the right to receive
cash and shares of the common stock, par value $1.00 per share, of Bell
Atlantic ("Bell Atlantic Common Stock") and rights (each, a "Right") issuable
pursuant to the Rights Agreement dated as of March 28, 1989, as amended (the
"Rights Agreement"), between Bell Atlantic and The Bank of New York.
Bell Atlantic has filed with the Securities and Exchange Commission
(the "SEC") a registration statement on Form S-4 (the "Registration Statement")
under the Securities Act of 1933, as amended (the "Securities Act"),
registering a maximum of 150,000 shares of Bell Atlantic Common Stock which may
be issued to the holders of Sams Common Stock pursuant to the Merger Agreement.
All information herein with respect to Sams and the Sellers has been furnished
by the Sellers. All information herein with respect to Bell Atlantic,
Purchaser and their affiliates has been furnished by Bell Atlantic.
--------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
--------------------
The date of this Prospectus is September 5, 1995.
<PAGE> 5
AVAILABLE INFORMATION
Bell Atlantic is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in
accordance therewith files reports, proxy statements and other information with
the SEC. Such reports, proxy statements and other information filed by Bell
Atlantic with the SEC may be inspected and copied at the public reference
facilities maintained by the SEC at Room 1024, 450 Fifth Street, N.W.,
Washington, D.C. 20549, and at the following Regional Offices of the SEC: 7
World Trade Center, 13th Floor, New York, New York 10048; and Citicorp Center,
500 West Madison Street, Suite 1400, Chicago, Illinois 60661-2511. Copies of
such material may be obtained from the Public Reference Section of the SEC at
450 Fifth Street, N.W., Washington, D.C. 20549, at prescribed rates. Bell
Atlantic Common Stock is listed on the New York Stock Exchange ("NYSE"), as
well as the Philadelphia, Boston, Chicago and Pacific Stock Exchanges. Copies
of reports, proxy statements and other information concerning Bell Atlantic
also may be inspected at the offices of the NYSE at 20 Broad Street, 18th
Floor, New York, New York 10005, as well as at the offices of such other stock
exchanges.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by Bell Atlantic with the SEC pursuant
to the Exchange Act are hereby incorporated by reference in this Prospectus:
(1) Bell Atlantic's Annual Report on Form 10-K for the fiscal year
ended December 31, 1994;
(2) Bell Atlantic's Quarterly Reports on Form 10-Q for the
quarters ended March 31, 1995 and June 30, 1995; and
(3) Bell Atlantic's Current Reports on Form 8-K dated January 23,
1995, April 20, 1995, and July 20, 1995.
Bell Atlantic will provide without charge to each person, including
any beneficial owner, to whom a Prospectus is delivered, upon written or oral
request of such person, a copy of any and all of the information that has been
incorporated by reference in this Prospectus (not including exhibits to the
information that is incorporated by reference unless such exhibits are
specifically incorporated by reference into the information that this
Prospectus incorporates). Such requests should be directed to Bell Atlantic
Corporation, Shareowner Services, 1717 Arch Street, 31st Floor, Philadelphia,
Pennsylvania 19103 (telephone 215-963-6065).
All documents filed by Bell Atlantic pursuant to Section 13(a), 13(c),
14 or 15(d) of the Exchange Act subsequent to the date of this Prospectus and
prior to the Effective Time of the Merger shall be deemed to be incorporated by
reference herein and to be a part hereof from the date of filing thereof. Any
statement contained in a document, all or a portion of which is incorporated or
deemed to be incorporated by reference herein, shall be deemed to be modified
or superseded for purposes of this Prospectus to the extent that a statement
contained herein modifies or supersedes such statement. Any such statement so
modified or superseded shall not be deemed, except as so modified or
superseded, to constitute a part of this Prospectus.
2
<PAGE> 6
TABLE OF CONTENTS
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AVAILABLE INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
SUMMARY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
The Parties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
The Merger . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Tax Consequences . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Regulatory Requirements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Selected Financial Data of Bell Atlantic . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Market for Common Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
HOWARD W. SAMS & COMPANY. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
THE MERGER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Background of the Merger . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Basic Terms of Merger Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Conversion of Sams Common Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Schedule of Release of Merger Consideration; Adjustments to Merger Consideration. . . . 9
Exchange Procedure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Effective Time . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Representations and Warranties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Certain Covenants of Sams . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Limitations on Other Proposals or Offers . . . . . . . . . . . . . . . . . . . . . . . . 11
Conditions to Consummation of the Merger . . . . . . . . . . . . . . . . . . . . . . . . 11
Modification or Amendment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Termination of the Merger Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Resale of Bell Atlantic Common Stock by Sellers . . . . . . . . . . . . . . . . . . . . . . . . 12
Certain Fees and Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
COMPARISON OF RIGHTS OF HOLDERS OF SAMS COMMON STOCK AND
BELL ATLANTIC COMMON STOCK . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Authorized Shares of Capital Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Voting Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Dividends and Other Distributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
</TABLE>
3
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Indemnification and Limitations on Directors' and Officers' Liability . . . . . . . . . . . . . 14
Rights Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
LEGAL OPINIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
INDEPENDENT ACCOUNTANTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
</TABLE>
NO PERSON IS AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATION
OTHER THAN THOSE CONTAINED OR INCORPORATED HEREIN AND, IF GIVEN OR MADE, SUCH
INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED
BY BELL ATLANTIC OR SAMS. NEITHER THE DELIVERY HEREOF NOR ANY DISTRIBUTION OF
SECURITIES MADE HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE AN IMPLICATION
THAT THERE HAS BEEN NO CHANGE IN THE FACTS HEREIN SET FORTH OR INCORPORATED
HEREIN SINCE THE DATE HEREOF OR SINCE THE DATE OF ANY DOCUMENT INCORPORATED
HEREIN. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION
OF AN OFFER TO BUY IN ANY JURISDICTION WHERE, OR TO ANY PERSON TO WHOM, IT IS
UNLAWFUL TO MAKE SUCH AN OFFER OR SOLICITATION.
4
<PAGE> 8
SUMMARY
THE PARTIES
Bell Atlantic Ventures XXIX, Inc. Bell Atlantic Ventures XXIX, Inc.
("Purchaser") is an Indiana corporation and a wholly-owned subsidiary of Bell
Atlantic Corporation ("Bell Atlantic") that was formed to effectuate the
Merger. Purchaser has not engaged in any business or operations other than in
connection with effectuating the Merger.
Howard W. Sams & Company. Howard W. Sams & Company ("Sams") is an
Indiana corporation primarily engaged in database publishing, technical service
information publishing and book publishing.
Damon C. Davis and Richard R. Hauser. Messrs. Davis and Hauser
(individually a "Seller" and together, the "Sellers") are the sole shareholders
of Sams. Each of the Sellers owns 50% of the issued and outstanding capital
stock of Sams. Mr. Davis is the Chairman of the Board of Sams, and Mr. Hauser
is the President of Sams. Each Seller is a party to the Merger Agreement and
has given all requisite approvals of the Merger Agreement and the Merger as a
shareholder under Indiana corporate law.
THE MERGER
The Merger Agreement provides that, subject to the satisfaction or
waiver of certain terms and conditions, Purchaser will be merged with and into
Sams and the Sellers, as the sole shareholders of Sams Common Stock immediately
prior to the effective time of the Merger, will be entitled to receive for each
share of Sams Common Stock a specified amount of cash calculated as set forth
in the Merger Agreement and a number, calculated in accordance with an Exchange
Ratio as defined in the Merger Agreement and described therein, of shares of
Bell Atlantic Common Stock, together with the same number of Rights issuable
pursuant to the Rights Agreement (provided that, in lieu of any fractional
share and Right, Seller will be entitled to receive a cash payment). See "THE
MERGER - Basic Terms of Merger Agreement - Conversion of Sams Common Stock".
The parties to the Merger Agreement currently expect that the closing of the
Merger (the "Closing") will occur during September 1995.
The total consideration payable to the Sellers in connection with the
Merger (the "Merger Consideration"), payable in the form of cash and shares of
Bell Atlantic Common Stock and Rights, will be $6,428,500, subject to certain
adjustments as described herein. The Merger Consideration is payable in two
installments. The first installment, comprising all of the Merger
Consideration other than $50,000 in cash, is to be delivered at Closing. The
second installment, comprising $50,000 in cash, subject to certain offsets,
will be delivered upon determination of the Purchase Price Adjustment as
provided in the Merger Agreement. The amount of cash and number of shares of
Bell Atlantic Common Stock into which each share of Sams Common Stock will be
converted will be calculated based on the aggregate amount of the Merger
Consideration (as it may be adjusted), the number of outstanding shares of Sams
Common Stock as of the Closing, and the market price of Bell Atlantic Common
Stock as of a period prior to the Closing. See "THE MERGER - Basic Terms of
Merger Agreement - Conversion of Sams Common Stock".
5
<PAGE> 9
TAX CONSEQUENCES
The Sellers have retained counsel to advise them as to the tax
consequences of the Merger.
SELECTED FINANCIAL DATA OF BELL ATLANTIC
The selected financial data of Bell Atlantic set forth below should be
read in conjunction with the audited financial statements contained in Bell
Atlantic's Annual Report on Form 10-K for the fiscal year ended December 31,
1994 and with the unaudited financial statements contained in Bell Atlantic's
Quarterly Report on Form 10-Q for the quarter ended June 30, 1995, which are
incorporated by reference in this Prospectus.
<TABLE>
<CAPTION>
At or for the
Six Months Ended
June 30, At or for the Year Ended December 31,
---------------------------- --------------------------------------------------------------
1995 1994 1994(a) 1993(b) 1992 1991(c) 1990
---- ---- ------- ------- ---- ------- ----
(Dollars in millions, except per share amounts)
<S> <C> <C> <C> <C> <C> <C> <C>
Operating revenues . . . . . . . $7,014.2 $6,849.6 $13,791.4 $13,145.6 $12,836.0 $12,659.7 $12,649.8
Operating income . . . . . . . . 1,674.5 1,546.3 2,804.6 2,797.6 2,506.2 2,525.3 2,614.3
Income before extraordinary items
and cumulative effect of changes
in accounting principles . . . . 861.6 811.3 1,401.9 1,481.6 1,382.2 1,229.9 1,230.5
Net income (loss) . . . . . . . . 861.6 804.6 (754.8) 1,403.4 1,340.6 (324.4) 1,230.5
Income before extraordinary items
and cumulative effect of changes
in accounting principles per
common share . . . . . . . . . . 1.97 1.86 3.21 3.39 3.23 2.91 2.92
Net income (loss) per common
share . . . . . . . . . . . . . . 1.97 1.84 (1.73) 3.22 3.13 (.72) 2.92
Cash dividends declared per
common share . . . . . . . . . . 1.40 1.38 2.76 2.68 2.60 2.52 2.36
Total assets . . . . . . . . . . 24,819.9 28,685.6 24,271.8 29,544.2 28,099.5 28,305.8 28,391.8
Long-term debt . . . . . . . . . 6,743.2 6,993.2 6,805.7 7,206.2 7,348.2 7,984.0 8,928.5
Book value per common share . . . 14.46 19.47 13.94 18.85 18.00 17.12 19.96
</TABLE>
NOTES TO BELL ATLANTIC CORPORATION SELECTED FINANCIAL DATA
(a) 1994 includes an extraordinary charge for the discontinuation of
regulatory accounting principles at the telephone subsidiaries
(effective August 1, 1994).
(b) 1993 includes the adoption of changes in accounting for income taxes
and postemployment benefits.
(c) 1991 includes the adoption of a change in accounting for
postretirement benefits other than pensions.
6
<PAGE> 10
MARKET FOR COMMON STOCK
The principal market for trading in Bell Atlantic Common Stock is the
New York Stock Exchange. Bell Atlantic Common Stock is also listed in the
United States on the Boston, Chicago, Pacific and Philadelphia stock exchanges.
As of June 30 1995, there were 965,305 shareowners of record.
High and low stock prices, as reported on the New York Stock Exchange
tape of composite transactions, and dividend data are as follows:
<TABLE>
<CAPTION>
CASH
MARKET PRICE DIVIDENDS
HIGH LOW DECLARED
---- --- --------
<S> <C> <C> <C> <C>
1995: First Quarter . . . . . . . . . . . . . $55 3/4 $48 3/8 $.70
Second Quarter . . . . . . . . . . . . 58 7/8 52 .70
1994: First Quarter . . . . . . . . . . . . . $59 5/8 $51 $.69
Second Quarter . . . . . . . . . . . . 56 3/4 49 .69
Third Quarter . . . . . . . . . . . . . 58 3/8 52 1/4 .69
Fourth Quarter . . . . . . . . . . . . 53 1/4 48 3/8 .69
1993: First Quarter . . . . . . . . . . . . . $56 3/4 $49 5/8 $.67
Second Quarter . . . . . . . . . . . . 59 3/8 50 3/4 .67
Third Quarter . . . . . . . . . . . . . 64 7/8 55 5/8 .67
Fourth Quarter . . . . . . . . . . . . 69 1/8 57 .67
1992: First Quarter . . . . . . . . . . . . . $49 $41 1/4 $.65
Second Quarter . . . . . . . . . . . . 45 40 1/4 .65
Third Quarter . . . . . . . . . . . . . 49 3/4 44 1/4 .65
Fourth Quarter . . . . . . . . . . . . 53 7/8 44 1/2 .65
</TABLE>
There is no established public trading market for Sams Common Stock.
All of the outstanding Sams Common Stock is held by Damon C. Davis and Richard
R. Hauser. Sams has never paid any cash dividends.
HOWARD W. SAMS & COMPANY
Howard W. Sams & Company ("Sams") was incorporated in Indiana in
December 1989. Sams was formed to acquire certain publishing assets of
Macmillan, Inc. Sams has no subsidiaries.
The primary business of Sams consists of database publishing,
technical service information publishing and book publishing.
The principal offices of Sams are located at 2647 Waterfront Parkway
East Drive, Indianapolis, Indiana 46214, and its telephone number is (317)
298-5400.
The registrant has concluded that it is impracticable to furnish the
financial information regarding Sams that is called for pursuant to Item 17 of
Form S-4.
7
<PAGE> 11
THE MERGER
INTRODUCTION
THE MERGER AGREEMENT PROVIDES FOR THE MERGER OF PURCHASER, A
WHOLLY-OWNED SUBSIDIARY OF BELL ATLANTIC, WITH AND INTO SAMS. SET FORTH BELOW,
AMONG OTHER THINGS, IS A DESCRIPTION OF THE MATERIAL TERMS OF THE MERGER
AGREEMENT. SUCH DESCRIPTION DOES NOT PURPORT TO BE COMPLETE AND IS QUALIFIED
IN ITS ENTIRETY BY REFERENCE TO THE TEXT OF THE MERGER AGREEMENT.
The Merger Agreement provides that, subject to the satisfaction or
waiver of certain conditions, including but not limited to the receipt of all
necessary third-party approvals, Purchaser will be merged with and into Sams.
See "Basic Terms of Merger Agreement - Conditions to Consummation of Merger"
below. As a result of the Merger, the separate corporate existence of
Purchaser will cease and the Sellers will be entitled to receive cash and
shares of Bell Atlantic Common Stock, together with Rights, in exchange for
their Sams Common Stock. See "Basic Terms of Merger Agreement - Conversion of
Sams Common Stock" below.
BACKGROUND OF THE MERGER
On July 18, 1995, the Sellers, Sams and an indirect, wholly-owned
subsidiary of Bell Atlantic executed a non-binding letter of intent which
provided for, among other things, the negotiation and execution of definitive
documents for the merger of Sams and a subsidiary of Bell Atlantic. After
negotiations, the Sellers, Sams and Purchaser executed an Agreement and Plan of
Merger dated as of August 30, 1995 (the "Merger Agreement"). The Merger
Agreement and the Merger were approved by the Board of Directors of Sams and by
the Sellers as the sole shareholders of Sams, and by the Board of Directors of
Purchaser and by Bell Atlantic as sole shareholder of Purchaser.
BASIC TERMS OF MERGER AGREEMENT
Conversion of Sams Common Stock. At the Effective Time (see
"Effective Time" below), each outstanding share of Sams Common Stock will be
converted into the right to receive cash and a number of shares of Bell
Atlantic Common Stock, together with the same number of Rights. For a
description of the Rights, see "COMPARISON OF RIGHTS OF HOLDERS OF SAMS COMMON
STOCK AND BELL ATLANTIC COMMON STOCK--Rights Agreement".
The total Purchase Price (as defined in Section 2.1(a) of the Merger
Agreement) into which the outstanding shares of Sams Common Stock will be
converted will be $6,428,500 less an adjustment (the "Purchase Price
Adjustment") for (i) the amount by which Sams' Indebtedness (as defined in
Section 2.1(c) of the Merger Agreement) as of the closing date of the Merger
(the "Closing Date") exceeds $1,821,500, (ii) the amount of any indebtedness
outstanding on the Closing Date from Sams to either Seller or his relatives,
and (iii) the amount by which Sams' Working Capital (as defined in Section
2.1(d) of the Merger Agreement) as of the Closing Date is less than $2,600,000.
Of the Purchase Price, the lesser of (i) $1,000,000 and (ii) 16% of the total
Purchase Price, will be paid in cash, and the balance will be paid in the form
of Bell Atlantic Common Stock. The exact number of shares of Bell Atlantic
Common Stock to
8
<PAGE> 12
be received by Seller, and the number of shares of Bell Atlantic Common Stock
into which each share of Sams Common Stock will be converted, will be
determined as of the Closing Date based upon an Exchange Ratio (as defined in
and determined in accordance with Section 2.2(b) of the Merger Agreement). The
Exchange Ratio will be based upon a fraction, the numerator of which is the
Conversion Amount per share of Sams Common Stock (as defined in and determined
in accordance with Section 2.2(b) of the Merger Agreement) and the denominator
of which is the BAC Conversion Price (as defined in and determined in
accordance with Section 2.2(b) of the Merger Agreement). The Exchange Ratio is
subject to changes in the Conversion Amount and the BAC Conversion Price.
The BAC Conversion Price (as defined in and determined in accordance
with Section 2.2(b) of the Merger Agreement) will be equal to the closing price
of Bell Atlantic Common Stock as reported on the NYSE Composite Tape for the
ten trading days ending on the fifth trading day prior to the Closing Date.
Market fluctuations in the price of Bell Atlantic Common Stock will affect the
Exchange Ratio applicable to Sams Common Stock. The closing price for Bell
Atlantic Common Stock on September 1, 1995, was $58-7/8.
THE BAC CONVERSION PRICE MAY BE MORE OR LESS THAN THE ACTUAL MARKET
PRICE OF BELL ATLANTIC COMMON STOCK AT THE EFFECTIVE TIME, AND ON THE DAY ON
WHICH CERTIFICATES FOR SHARES OF BELL ATLANTIC COMMON STOCK ARE SENT TO SELLER.
Assuming for illustration purposes only that the Conversion Amount
will be $92.00, variations in the BAC Conversion Price will proportionately
affect the Exchange Ratio that will determine the number of shares of Bell
Atlantic Common Stock issuable in exchange for a share of Sams Common Stock
upon consummation of the Merger as illustrated by the following table:
<TABLE>
<CAPTION>
Exchange Ratio for
Assumed Assumed BAC Bell Atlantic Common Stock
Conversion Amount Conversion Price per Sams Share
----------------- ---------------- --------------
<S> <C> <C>
$92.00 $55.00 1.6729 shares
$92.00 $58.00 1.5864 shares
$92.00 $61.00 1.5083 shares
</TABLE>
No fractional share of Bell Atlantic Common Stock and no fractional
Right will be issued in the Merger. Instead, to the extent that a Seller would
otherwise be entitled to receive a fractional share of Bell Atlantic Common
Stock and a fractional Right, such Seller will be paid an amount of cash,
without interest, equal to such fraction of a share of Bell Atlantic Common
Stock, multiplied by the BAC Conversion Price.
Schedule of Release of Merger Consideration; Adjustments to Merger
Consideration. The Merger Consideration will be delivered to the Sellers as
follows (subject to the adjustments described below): On the Closing Date, in
return for delivery of the Sams Common Stock, the Sellers will receive, in the
aggregate, all of the Bell Atlantic Common Stock portion, and all but $50,000
of the cash portion. The balance of the Merger Consideration will be delivered
to the Sellers at such time as the Purchase Price
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<PAGE> 13
Adjustment has been finally determined. The portion of the Merger
Consideration to be delivered following the Closing Date shall be reduced or
increased, as applicable, on a dollar-for-dollar basis for any amount by which
the Purchase Price Adjustment exceeds or is less than, respectively, the
estimated amount thereof used for purposes of determining the amount of Merger
Consideration on the Closing Date, and shall be further reduced on a
dollar-for-dollar basis for claims by Purchaser against the Sellers for
indemnification for breaches of representations and warranties or for failure
to comply with covenants as provided for in the Merger Agreement.
Exchange Procedure. At the Effective Time, each Seller will surrender
all certificates representing the outstanding shares of Sams' outstanding
Common Stock for payment therefor and conversion thereof. Upon the surrender
of such certificates, Purchaser will deliver the first installment of cash and
the certificates evidencing shares of Bell Atlantic Common Stock, all in
accordance with instructions provided by such Seller.
Until such shares of Sams Common Stock are surrendered, each
certificate for Sams Common Stock that immediately prior to the Effective Time
represented shares of Sams Common Stock shall be deemed at and after the
Effective Time to represent only the right to receive, upon such surrender, the
Merger Consideration payable with respect to such shares. A Seller will not be
entitled to receive any dividend or distribution payable to holders of Bell
Atlantic Common Stock declared with a record date after the Effective Time, or
to exercise any voting rights with respect to Bell Atlantic Common Stock to be
issued as Merger Consideration, or to receive certificates representing shares
of Bell Atlantic Common Stock, until such Seller's certificates for Sams Common
Stock have been surrendered in accordance with the procedures set forth in the
Merger Agreement.
Effective Time. The Merger will be consummated five business days
after all conditions to the consummation of the Merger set forth in the Merger
Agreement are satisfied or, to the extent permitted by law, waived, or on such
other date as mutually agreed by Purchaser and the Sellers. See "Conditions to
Consummation of the Merger" below. The Effective Time will occur on the filing
of the Articles of Merger with the Indiana Secretary of State.
Representations and Warranties. Sams, the Sellers and Purchaser have
made a number of representations and warranties in the Merger Agreement with
respect to, among other things, their organization and good standing, and their
authorization and authority to enter into and perform their respective
obligations under the Merger Agreement. The Sellers and Sams also have made
representations and warranties in the Merger Agreement with respect to Sams'
business and operations, including but not limited to the status of certain
governmental licenses, material contracts, title to and condition of property,
environmental matters, tax matters, contracts, litigation, capitalization,
ownership of Sams Common Stock, conduct of business, the accuracy in all
material respects of the information provided by them in this Prospectus, and
the accuracy of Sams' financial statements.
Certain Covenants of Sams. The Sellers and Sams have agreed that,
during the period prior to the Effective Time (except as expressly permitted by
the Merger Agreement or to the extent that Purchaser shall otherwise agree),
Sams will carry on its business in the ordinary course consistent with past
practice; will take all action necessary to comply with and maintain all
governmental licenses used or held in connection with its business and
otherwise preserve its rights to conduct its business; and will use its best
10
<PAGE> 14
efforts to preserve intact its business organization and maintain its existing
relations with customers, suppliers, employees and business associates. In
addition, Sams has agreed that, during the period prior to the Effective Time,
Sams will not (except as expressly permitted by the Merger Agreement or to the
extent that Purchaser shall otherwise consent): (a) take any action which would
cause the representations and warranties made by the Sellers and Sams to become
untrue; or (b) declare, pay or set aside for payment any dividend or other
distribution in respect of its capital stock.
Limitations on Other Proposals or Offers. Sams and the Sellers have
agreed not to, and not to permit any director, officer, agent or affiliate of
Sams to, directly or indirectly, sell, agree to sell, solicit inquiries or
proposals or furnish any non-public information with respect to, or participate
in any negotiations or discussions concerning any acquisition or purchase of,
all or a substantial portion of the business or the assets of, or any equity
interest in, Sams, or any business combination with Sams. The Merger Agreement
requires Sams and the Sellers to advise Purchaser immediately if Sams receives
such an offer or inquiry.
Conditions to Consummation of the Merger. The respective obligations
of each of Purchaser, the Sellers and Sams to consummate the Merger are subject
to the satisfaction at or prior to the Closing Date of certain conditions, any
one or more of which may be waived in whole or in part by the party entitled to
the benefit thereof, to the extent permitted by law, including that the
registration statement filed with the SEC with respect to the shares of Bell
Atlantic Common Stock to be issued in the Merger shall have become effective
and no stop order suspending the effectiveness of such registration statement
shall have been issued and no proceedings for that purpose shall have been
initiated or threatened by the SEC.
The obligation of Purchaser to consummate the Merger also is subject
to the satisfaction of certain additional conditions, including the following,
unless waived by Purchaser, to the extent permitted by law: (a) the
representations and warranties of Sams and the Sellers contained in the Merger
Agreement shall have been true on the date of the Merger and shall be true and
correct in all material respects at and as of the Closing with the same force
and effect as though the same had been made at and as of the Closing; (b) the
obligations of Sams and the Sellers under the Merger Agreement required to be
performed by Sams or the Sellers at or prior to the Closing shall have been
duly performed in all respects; (c) there shall not be any suit, action or
other proceeding, or injunction or final judgment relating thereto, pending or
threatened to restrain or prohibit or to obtain damages or other relief in
connection with any of the transactions contemplated by the Merger Agreement,
and no investigation that might result in any such suit, action or proceeding
shall be pending or threatened; (d) all governmental consents and governmental
filings and all other consents or approvals of any other person determined to
be required to permit the consummation of the transactions contemplated by the
Merger Agreement shall have been obtained or made; and (e) each Seller shall
have entered into an Employment Agreement in the form attached as Exhibit
5.1.10 to the Merger Agreement.
The obligations of Sams and the Sellers to consummate the Merger also
are subject to the satisfaction of certain additional conditions, including the
following, unless waived by the Sellers, to the extent permitted by law: (a)
the representations and warranties of Purchaser contained in the Merger
Agreement shall have been true when made and shall be true and correct in all
material respects at and as of the Closing with the same force and effect as
though the same had been made at and as of the Closing, and the obligations of
Purchaser under the Merger Agreement required to be performed by it at or prior
to
11
<PAGE> 15
the Closing shall have been duly performed in all material respects; and (b)
all governmental consents and governmental filings required to permit the
consummation of the transactions contemplated by the Merger Agreement shall
have been obtained or made.
The conditions to be satisfied before the parties will be obligated to
consummate the Merger are set forth in Article 5 of the Merger Agreement. Any
provision of the Merger Agreement may be waived at any time, to the extent
permitted by law, by the party entitled to the benefits of the provision.
Modification or Amendment. The Merger Agreement may not be modified
or amended except by a written agreement executed on behalf of Purchaser, the
Sellers and Sams.
Termination of the Merger Agreement. The Merger Agreement may be
terminated at any time prior to the filing of the Articles of Merger with the
Indiana Secretary of State: (a) by mutual consent of Purchaser and the Sellers;
or (b) by Purchaser or by either Seller if: (i) the Merger is not consummated
by September 30, 1995 through no fault of the terminating party or its (and, in
the case of a Seller, Sams') directors, officers or shareholders; or (ii) the
other party has failed to comply in any material respect with any of the
covenants or agreements contained in the Merger Agreement to be complied with
or performed by it at or prior to the Closing Date and such failure has not
been cured within 20 business days after receipt of notice thereof or the
representations and warranties made by such other party were materially
incorrect when or become materially incorrect prior to Closing.
RESALE OF BELL ATLANTIC COMMON STOCK BY SELLERS
The shares of Bell Atlantic Common Stock to be issued to Seller in the
Merger have been registered under the Securities Act. Since each Seller owns
50% of the outstanding Common Stock of Sams and is an executive officer of
Sams, each Seller is considered to be an "affiliate" of Sams, as that term is
used in Rule 145 under the Securities Act ("Rule 145"). Rule 145 imposes
certain restrictions on the transfer of shares received by an affiliate in a
merger. Rule 145 also provides certain conditions under which a Seller, as an
affiliate of Sams, would nevertheless be permitted to resell the Bell Atlantic
shares he is to receive in the Merger without being deemed an underwriter. As
a condition to the consummation of the Merger, each Seller will be required to
deliver a letter under which such Seller agrees not to dispose of such Bell
Atlantic shares except in accordance with the applicable provisions of Rule
145.
CERTAIN FEES AND EXPENSES
If the Merger Agreement is terminated by Purchaser under the
termination provisions of Section 8.1(a)(ii) of the Merger Agreement, then the
Sellers and Sams will be jointly and severally liable to Purchaser for all of
Purchaser's costs and expenses incurred in connection with the Merger
Agreement. If the Merger Agreement is terminated by either Seller under the
termination provisions of Section 8.1(a)(iii) of the Merger Agreement, then
Purchaser will be liable to the Sellers and Sams for all of their costs and
expenses incurred in connection with the Merger Agreement. See "Termination of
the Merger Agreement" under "THE MERGER--Basic Terms of the Merger Agreement"
above.
Except as set forth above, each of the parties to the Merger Agreement
will pay its own expenses in connection with the Merger Agreement.
12
<PAGE> 16
COMPARISON OF RIGHTS OF HOLDERS OF
SAMS COMMON STOCK AND
BELL ATLANTIC COMMON STOCK
Following consummation of the Merger and the surrender of certificates
representing shares of Sams Common Stock, Sams' shareholders will become
shareholders of Bell Atlantic. The following is a summary discussion of the
most significant differences in the rights of holders of Sams Common Stock and
Bell Atlantic Common Stock. These differences arise from the various provisions
of the corporation laws of the states under which Sams and Bell Atlantic are
organized (Indiana and Delaware, respectively), and from the various provisions
of the respective certificates of incorporation and By-laws of Sams and Bell
Atlantic and from the Rights Agreement. This summary is not intended to be
complete and is qualified in its entirety by reference to the certificate of
incorporation and By-laws of each of Sams and Bell Atlantic and to the Rights
Agreement.
AUTHORIZED SHARES OF CAPITAL STOCK
The Certificate of Incorporation of Bell Atlantic authorizes the
issuance of 1.5 billion shares of Bell Atlantic Common Stock, 12.5 million
shares of series preferred stock, par value $1.00 per share (the "Bell Atlantic
Series Preferred Stock"), and 12.5 million shares of series preference stock,
par value $1.00 per share (the "Bell Atlantic Series Preference Stock"). The
Board of Directors is authorized to provide for the issuance of the Bell
Atlantic Series Preferred Stock or Bell Atlantic Series Preference Stock from
time to time in series and, as to each series, to fix the number of shares in
such series and the voting, dividend, redemption liquidation, retirement and
conversion provisions applicable to the shares of such series. Pursuant to
this authority, on March 28, 1989, in conjunction with its execution of the
Rights Agreement (see "Rights Agreement" below), the Board of Directors of Bell
Atlantic created a series of Bell Atlantic Series Preference Stock, designated
as Series A Junior Participating Preference Stock, par value $1.00 per share
(the "Series A Junior Participating Preference Stock"), comprising 5 million
shares of such Series A Junior Participating Preference Stock.
As of June 30, 1995, approximately 437,600,000 shares of Bell Atlantic
Common Stock were issued and outstanding. As of such date, no shares of Bell
Atlantic Series Preferred Stock, Bell Atlantic Series Preference Stock or
Series A Junior Participating Preference Stock were issued and outstanding and
Bell Atlantic has no plans to issue any shares of Bell Atlantic Series
Preferred Stock, Bell Atlantic Series Preference Stock or Series A Junior
Participating Preference Stock as of the date of this Prospectus.
The Certificate of Incorporation of Sams authorizes its Board of
Directors to issue 20,000,000 shares of Sams Common Stock and 10,000 Preferred
Shares. As of June 30, 1995, there were 59,000 shares of Sams Common Stock
outstanding, 29,500 of which were owned by Damon C. Davis, Chairman of the
Board of Sams and 29,500 of which were owned by Richard R. Hauser, President of
Sams. No other shares of Sams Common Stock or Sams Preferred Shares are
outstanding, and Sams Common Stock is not publicly traded.
13
<PAGE> 17
VOTING RIGHTS
Holders of Bell Atlantic Common Stock have one vote per share on all
matters submitted to a vote of the stockholders of Bell Atlantic and do not
have the right to cumulate votes.
Holders of Sams Common Stock are entitled to one vote per share on all
matters requiring shareholder action and do not have cumulative voting rights
for the election of directors. The holders of Sams Common Stock have no
preemptive or other subscription or conversion rights, and there are no
redemption or sinking fund provisions applicable thereto. All issued and
outstanding shares of Sams Common Stock are fully paid and nonassessable.
DIVIDENDS AND OTHER DISTRIBUTIONS
The holders of Bell Atlantic Common Stock are entitled to receive,
from funds legally available for the payment thereof, dividends when and as
declared by resolution of the Board of Directors. See "SUMMARY - Market for
Common Stock".
Holders of Sams Common Stock are entitled to receive dividends when
and as declared by the Board of Directors. In the event of the liquidation,
dissolution, distribution of assets or winding up of Sams, the holders of Sams
Common Stock are entitled to share pro rata in the assets remaining after
creditors have been paid. Sams has not paid any dividends on Sams Common Stock
and has no present intention of doing so. Certain commercial loan agreements
to which Sams is a party restrict or prohibit the payment of dividends on Sams
Common Stock.
INDEMNIFICATION AND LIMITATIONS ON DIRECTORS' AND OFFICERS' LIABILITY
The Certificate of Incorporation of Bell Atlantic provides that, to
the fullest extent provided by the Delaware General Corporation Law (the
"DGCL"), a director of such corporation will not be liable for monetary damages
to such corporation or its stockholders for breach of fiduciary duty. The DGCL
provides that a corporation may limit or eliminate a director's or officer's
personal liability for monetary damages to the corporation or its shareholders
except for liability (i) for any breach of the director's or officer's duty of
loyalty to the corporation or its stockholders, (ii) for acts or omissions not
in good faith or which involve intentional misconduct or a knowing violation of
law, (iii) for paying a dividend or approving a stock repurchase in violation
of Section 174 of the DGCL, or (iv) for any transaction from which the director
or officer derived an improper personal benefit.
The By-laws of Bell Atlantic provide for indemnification under certain
circumstances of an officer or director who was or is a party or is threatened
to be made a party to any pending or completed action, suit or proceeding,
whether civil, criminal, administrative or investigative, by reason of the fact
that such person was an officer or director of Bell Atlantic. Such
indemnification includes expenses incurred in the successful defense of any
such action, suit or proceeding.
Chapter 37 of the Indiana Business Corporation Law grants to each
Indiana corporation broad powers to indemnify directors, officers, employees or
agents against expenses incurred in certain
14
<PAGE> 18
proceedings if the conduct in question was found to be in good faith and was
reasonably believed to be in the corporation's best interest. This statute
provides, however, that this indemnification should not be deemed exclusive of
any other indemnification rights provided by the articles of incorporation,
by-laws, resolution or other authorization adopted by majority vote of the
voting shares then issued and outstanding. The Code of By-Laws of Sams
contains certain provisions requiring indemnification of directors whose
conduct is not found to have constituted willful misconduct or recklessness.
RIGHTS AGREEMENT
On March 28, 1989, the Board of Directors of Bell Atlantic declared a
dividend distribution of one Right for each outstanding share of Bell Atlantic
Common Stock to stockholders of record at the close of business on April 10,
1989. Subject to exceptions set forth in the Rights Agreement, each Right,
when exercisable, entitles the registered holder to purchase from Bell Atlantic
one one-hundredth of a share of Series A Junior Participating Preference Stock
at a price of $250 per one one-hundredth share, subject to adjustment. The
description and terms of the Rights are set forth in the Rights Agreement.
LEGAL OPINIONS
The validity of the Bell Atlantic Common Stock to be issued in the
Merger has been passed upon for Bell Atlantic by P. Alan Bulliner, Vice
President-Corporate Secretary and Counsel of Bell Atlantic. As of June 30,
1995, Mr. Bulliner owned beneficially and had options to acquire 20,870 shares
of Bell Atlantic Common Stock.
INDEPENDENT ACCOUNTANTS
The consolidated financial statements and consolidated financial
statement schedule of Bell Atlantic and its subsidiaries included in Bell
Atlantic's Annual Report on Form 10-K for the year ended December 31, 1994,
have been incorporated by reference herein in reliance on the reports of
Coopers & Lybrand L.L.P., independent accountants, given on the authority of
that firm as experts in accounting and auditing.
15
<PAGE> 19
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
ITEM 20. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 145 of the Delaware General Corporation Law provides for the
indemnification of directors and officers under certain circumstances.
Generally such persons must have acted in good faith and in a manner reasonably
believed to be in, or not opposed to, the best interests of the corporation
and, with respect to any criminal action or proceeding, such person must also
have had no reasonable cause to believe his conduct was unlawful. In any
proceeding by or in the right of the corporation, no such indemnification may
be made if such person shall have been adjudged to have been liable to the
corporation, unless, and only to the extent, the court in which the proceeding
was brought, or the Delaware Court of Chancery, orders such indemnification.
When the director or officer successfully defends any such civil or criminal
proceeding, indemnification is required. Bell Atlantic's By-Laws provide for
indemnification of Bell Atlantic's officers and directors to the extent
permitted by the Delaware General Corporation Law.
The directors and officers of Bell Atlantic are insured against
certain liabilities, including certain liabilities arising under the Securities
Act of 1933, which might be incurred by them in such capacities and against
which they cannot be indemnified by Bell Atlantic. Such insurance is in
addition to rights of directors and officers to indemnification by Bell
Atlantic.
ITEM 21. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.
Exhibits
The following exhibits are filed as part of this Registration Statement.
EXHIBIT
NUMBER
2 Agreement and Plan of Merger dated as of August 30, 1995, among a
subsidiary of the registrant, Damon C. Davis, Richard R. Hauser, and
Howard W. Sams & Company.
5 Opinion of P. Alan Bulliner, Vice President-Corporate Secretary and
Counsel of the registrant, as to the legality of the securities
being registered.
23.1 Consent of Coopers & Lybrand L.L.P., Independent Public Accountants.
23.2 Consent of P. Alan Bulliner, Vice President-Corporate Secretary and
Counsel is contained in the opinion of counsel filed as Exhibit 5.
24 Powers of Attorney executed by officers and directors who signed
this registration statement.
II-1
<PAGE> 20
ITEM 22. UNDERTAKINGS.
The undersigned registrant hereby undertakes:
(a) That, for purposes of determining any liability under the Securities Act,
each filing of the registrant's annual report pursuant to Section 13(a) or
Section 15(d) of the Securities Exchange Act of 1934 (and, where applicable,
each filing of an employee benefit plan's annual report pursuant to section
15(d) of the Securities Exchange Act of 1934) that is incorporated by reference
in the registration statement shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
(b) That prior to any public reoffering of the securities registered hereunder
through use of a prospectus which is a part of this registration statement, by
any person or party who is deemed to be an underwriter within the meaning of
Rule 145(c), the issuer undertakes that such reoffering prospectus will contain
the information called for by the applicable registration form with respect to
reofferings by persons who may be deemed underwriters, in addition to the
information called for by the other Items of the applicable form.
(c) That every prospectus (i) that is filed pursuant to paragraph (b)
immediately preceding, or (ii) that purports to meet the requirements of
Section 10(a)(3) of the Securities Act of 1933 and is used in connection with
an offering of securities subject to Rule 415, will be filed as a part of an
amendment to the registration statement and will not be used until such
amendment is effective, and that, for purposes of determining any liability
under the Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
(d) To deliver or cause to be delivered with the prospectus, to each person to
whom the prospectus is sent or given, the latest annual report to security
holders that is incorporated by reference in the prospectus and furnished
pursuant to and meeting the requirements of Rule 14a-3 under the Securities
Exchange Act of 1934; and, where interim financial information required to be
presented by Article 3 of Regulation S-X is not set forth in the prospectus, to
deliver, or cause to be delivered to each person to whom the prospectus is sent
or given, the latest quarterly report that is specifically incorporated by
reference in the prospectus to provide such interim financial information.
(e) To respond to requests for information that is incorporated by reference
into the prospectus pursuant to Items 4, 10(b), 11 or 13 of this Form, within
one business day of receipt of such request, and to send the incorporated
documents by first class mail or other equally prompt means. This includes
information contained in documents filed subsequent to the effective date of
the registration statement through the date of responding to the request.
(f) To supply by means of a post-effective amendment all information
concerning a transaction, and the company being acquired involved therein, that
was not the subject of and included in the registration statement when it
became effective.
(g) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the registrant pursuant to the provisions referred to in Item 15 (other than
the insurance policies referred to therein), or otherwise, the registrant has
been advised that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Securities Act of
1933 and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted against the registrant by such director, officer or
controlling person in connection with the securities being registered, the
registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate jurisdiction
the question whether such indemnification by it is against public policy as
expressed in the Securities Act of 1933 and will be governed by the final
adjudication of such issue.
II-2
<PAGE> 21
SIGNATURES
THE REGISTRANT
Pursuant to the requirements of the Securities Act of 1933, the registrant has
duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Philadelphia,
Commonwealth of Pennsylvania, on the 5th day of September, 1995.
BELL ATLANTIC CORPORATION
By: /s/ William O. Albertini
-----------------------------------------------------
William O. Albertini
(Executive Vice President and Chief Financial Officer)
Pursuant to the requirements of the Securities Act of 1933, this registration
statement or amendment thereto has been signed below by the following persons
in the capacities and on the date indicated.
PRINCIPAL EXECUTIVE OFFICER:
Raymond W. Smith
Chairman and Chief Executive Officer
PRINCIPAL FINANCIAL OFFICER:
William O. Albertini
Executive Vice President and Chief Financial
Officer
PRINCIPAL ACCOUNTING OFFICER:
Barbara L. Connor
Vice President - Finance and Controller
DIRECTORS: By: /s/ William O. Albertini
--------------------------
William W. Adams (William O. Albertini,
William O. Albertini individually and
Lawrence T. Babbio, Jr. as attorney-in-fact)
Thomas E. Bolger
Frank C. Carlucci September 5, 1995
William G. Copeland
James G. Cullen
James H. Gilliam, Jr.
Thomas H. Kean
John C. Marous, Jr.
John F. Maypole
Joseph Neubauer
Thomas H. O'Brien
Rozanne L. Ridgway
Raymond W. Smith
Shirley Young
II-3
<PAGE> 1
EXHIBIT 2
TO REGISTRATION STATEMENT ON FORM S-4
OF BELL ATLANTIC CORPORATION
<PAGE> 2
AGREEMENT AND PLAN OF MERGER
AGREEMENT AND PLAN OF MERGER (hereinafter called this "Agreement"),
dated as of August 30, 1995, among Howard W. Sams & Company, an Indiana
corporation (the "Company"); Damon C. Davis and Richard R. Hauser (each a
"Seller" and together the "Sellers"); and Bell Atlantic Ventures XXIX, Inc.
("Purchaser"), an Indiana corporation and a wholly owned subsidiary of Bell
Atlantic Corporation ("BAC"). (The Company and Purchaser are sometimes
collectively referred to herein as the "Constituent Corporations".)
WHEREAS, the Sellers own all of the issued and outstanding stock of the
Company; and
WHEREAS, the Sellers wish to exchange their shares of Company stock
for shares of BAC common stock and cash; and
WHEREAS, the Sellers and Purchaser wish to effect such an exchange
through a merger of the Company and Purchaser; and
WHEREAS, it is intended that the Merger (as hereinafter defined) will
be a tax-free reorganization under Section 368(a)(2)(E) of the Internal Revenue
Code of 1986, as amended (the "Code"); and
WHEREAS, the respective Boards of Directors of the Company and
Purchaser, and the sole shareholder of Purchaser and the shareholders of the
Company, have approved the merger of Purchaser with and into the Company upon
the terms and subject to the conditions set forth herein and in accordance with
the Indiana Business Corporation Law (the "IBCL");
NOW, THEREFORE, in consideration of the premises and the mutual
representations, warranties, covenants, agreements and conditions herein
contained, the parties hereto agree as follows:
1. THE MERGER; THE SURVIVING CORPORATION
1.1 The Merger. Subject to the terms and conditions of this
Agreement, at the Effective Time (as defined in Section 1.5), Purchaser shall
be merged with and into the Company and the separate corporate existence of
Purchaser shall thereupon cease (the "Merger"). The Company shall be the
surviving corporation in the Merger (sometimes hereinafter referred to as the
"Surviving Corporation") and shall continue to be governed by the laws of the
State of Indiana, and the separate corporate existence of the Company, with all
the rights, privileges, powers, franchises, liabilities and obligations of each
of the Constituent Corporations, including the duties and obligations of
Purchaser under this Agreement, shall continue unaffected by the Merger. The
Merger shall have the effects specified in the IBCL.
<PAGE> 3
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1.2 Articles of Incorporation and By-Laws of the Surviving
Corporation. The Articles of Incorporation and the By-Laws of Purchaser in
effect at the Effective Time shall be the Articles of Incorporation and the
By-Laws of the Surviving Corporation, until duly amended in accordance with the
terms thereof and the IBCL.
1.3 Directors and Officers of the Surviving Corporation. The
directors and officers of Purchaser shall be the directors and officers of the
Surviving Corporation from and after the Effective Time, until their respective
successors have been duly elected or appointed and qualified or until their
earlier death, resignation or removal in accordance with the Surviving
Corporation's Articles of Incorporation and By-Laws.
1.4 Closing.
(a) The Closing of the Merger (the "Closing") shall take
place at the offices of Bell Atlantic Corporation, 1717 Arch Street,
Philadelphia, Pennsylvania, at 10:00 a.m. local time, on the date which is five
business days after satisfaction or waiver of all the conditions set forth in
Article 5, or at such other place and time and/or on such other date as the
Company and Purchaser may agree. The "Closing Date" shall be the date on which
the Closing occurs.
(b) At the Closing and subject to the terms and
conditions herein contained:
(i) The Sellers shall deliver to Purchaser the
following:
(A) certificates representing all of the
issued and outstanding Common Shares of the Company, no par value (the "Company
Stock"), free and clear of any mortgage, lien, claim, security interest or
encumbrance whatsoever; and
(B) at the principal offices of the
Company, all corporate documentation, including, as applicable, the minute
book, stock transfer book and corporate seals of the Company, and its books of
account, records, agreements, leases, software licenses, customer and supplier
lists, sales records, files, contracts, tax returns and other documents;
(ii) Purchaser shall deliver to the Sellers the
Merger Consideration, as defined in Section 2.2(a) (excluding the Retention),
in accordance with Section 2.4.
(c) At or prior to the Closing, each of the parties
hereto shall also deliver to each other such other agreements, opinions,
certificates, documents and instruments contemplated by Article 5.
1.5 Effective Time. On the Closing Date, the Company and
Purchaser will cause the articles of merger in the form attached as Exhibit 1.5
(the "Articles of Merger") to be properly executed and filed with the Indiana
Secretary of State in accordance with the IBCL. The Merger shall become
effective at the time at which the Articles of Merger have been duly filed with
the Indiana Secretary of State (the "Effective Time").
<PAGE> 4
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1.6 Further Assurances. If at any time after the Effective Time
the Surviving Corporation shall consider or be advised that any further deeds,
bills of sale, assignments, assurances or any other actions or things are
necessary, desirable or proper to vest, perfect or confirm, of record or
otherwise, in the Surviving Corporation its right, title or interest in, to or
under any of the rights, properties or assets of either of the Constituent
Corporations acquired or to be acquired by the Surviving Corporation as a
result of, or in connection with, the Merger or otherwise to carry out the
purposes of this Agreement, the officers and directors of the Surviving
Corporation shall be authorized to execute and deliver, in the name and on
behalf of each of the Constituent Corporations or otherwise, all such deeds,
bills of sale, assignments and assurances and to take and do, in the name and
on behalf of each of the Constituent Corporations or otherwise, all such other
actions and things as may be necessary, desirable or proper to vest, perfect or
confirm any and all right, title and interest in, to and under such rights,
properties or assets in the Surviving Corporation or otherwise to carry out the
purposes of this Agreement. Each Seller shall, at the reasonable request of
BAC or its affiliates, and Purchaser shall, at the reasonable request of either
Seller, execute and deliver any additional documents, or take such other
actions, which BAC or such Seller may deem necessary or desirable to carry out
the purposes of this Agreement.
2. CONVERSION OF SHARES;
DELIVERY OF MERGER CONSIDERATION
2.1 Purchase Price.
(a) (i) The Purchase Price as used herein shall mean an
amount equal to Six Million Four Hundred Twenty-Eight Thousand Five Hundred
Dollars ($6,428,500.00) less the Purchase Price Adjustment, which shall be the
sum of (i) the amount, if any, by which the Company's Indebtedness (as defined
in Section 2.1(c)) as of the Closing Date exceeds One Million Eight Hundred
Twenty-One Thousand Five Hundred Dollars ($1,821,500.00), plus (ii) the amount,
if any, of any indebtedness outstanding on the Closing Date from either Seller
or his relatives to the Company, plus any accrued and outstanding interest
thereon, plus (iii) the amount, if any, by which the Company's Working Capital
(as defined in Section 2.1(d)) as of the Closing Date is less than Two Million
Six Hundred Thousand Dollars ($2,600,000.00) plus (iv) the aggregate amount of
all payments made on or before the Closing Date by the Company to Development
Capital, Inc. ("DCI") pursuant to the Settlement Agreement dated August 18,
1995 among the Company, DCI and Dennis Erwin (the "DCI Settlement Agreement"),
a copy of which has been provided to Purchaser, which DCI Settlement Agreement
refers to a letter agreement dated June 9, 1994 between DCI and the Company
(the "DCI Letter").
(ii) Purchaser and the Sellers shall agree on a good
faith estimate of the Purchase Price Adjustment at Closing for purposes of the
initial delivery of the Merger Consideration. Within 60 days after the Closing
Date, Purchaser, in consultation with the Sellers, shall prepare a balance
sheet of the Company as of the Closing Date (the "Closing Balance Sheet") in
accordance with generally accepted accounting principles applied consistently
with the
<PAGE> 5
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Company's past practice, and shall notify the Sellers of Purchaser's
determination of the actual amount of the Purchase Price Adjustment. Within 30
days after such notification, the Sellers shall notify Purchaser either that
they agree or they disagree with such determination, and if they disagree, they
shall state the basis for such disagreement and the amount which they consider
to be the actual Purchase Price Adjustment. Failure to give such notice within
such 30-day period shall constitute agreement by the Sellers to Purchaser's
determination. If the Sellers give notice of disagreement, and the parties are
unable within 15 days of such notice to reach agreement on the actual amount of
the purchase price adjustment, the matter will be referred for determination of
the actual amount of the Purchase Price Adjustment to one of the following
independent accounting firms: Katz Sapper & Miller, Whipple & Co., R.J. Pile &
Co., or Ernst & Young. In the event Purchaser and the Sellers are unable to
agree upon which such accounting firm shall be utilized, a strike procedure
shall be utilized with Purchaser first delivering one strike, then Sellers
delivering one strike, then Purchaser delivering a final strike, and the firm
remaining after such three strikes shall be utilized. Purchaser and the
Sellers shall each pay one-half of the cost of having such determination made
by such firm. Any difference between the estimated and actual amount of the
Purchase Price Adjustment will be settled pursuant to Section 2.4.
(b) Of the total Purchase Price, an amount equal to the
lesser of (i) One Million Dollars ($1,000,000.00) or (ii) sixteen percent (16%)
of the Purchase Price (such lesser amount shall be referred to as the "Cash
Payment") shall be payable in cash, and the balance shall be payable in the
form of BAC Common Stock (as defined in Section 2.2(a)(i)), all as provided in
Section 2.3.
(c) For purposes of this Section 2.1, "Indebtedness"
shall mean the sum of (i) the aggregate principal amount of all
interest-bearing indebtedness of the Company to third parties, excluding trade
payables incurred in the ordinary course of business, together with all accrued
but unpaid interest thereon, plus (ii) the net present value recorded by the
Company of all payments required to be made under all capital leases to which
the Company is a party; provided, however, that if the Company draws on its
revolving line of credit to make any regular Company payroll payment paid
within seven calendar days prior to the Closing Date, the amount of such draw
shall be excluded from Indebtedness and shall instead be included in current
liabilities for purposes of determining Working Capital. Purchaser agrees that
for purposes of determining Indebtedness, the leases listed on Schedule
3.1.20(e) shall not be considered capital leases.
(d) For purposes of this Section 2.1, "Working Capital"
shall mean total current assets less total current liabilities, determined in
accordance with generally accepted accounting principles applied consistently
with the Company's past practice but excluding from current liabilities for
this purpose all indebtedness for monies borrowed (and all accrued but unpaid
interest thereon) except for any amount excluded from Indebtedness in
accordance with the proviso at the end of the first sentence of Section 2.1(c).
<PAGE> 6
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2.2 Conversion of Company Stock
(a) At the Effective Time, each share of Company Stock
issued and outstanding immediately prior to the Effective Time shall, by virtue
of the Merger and without any action on the part of the Seller, be converted
into the right to receive:
(i) that number of shares of common stock, par value
$1.00 per share, of BAC ("BAC Common Stock") determined pursuant to Section
2.2(b), together with that same number of rights (a "Right") issuable pursuant
to the Rights Agreement dated as of March 28, 1989, as amended (the "Rights
Agreement"), between BAC and The Bank of New York, provided that no fractional
share of BAC Common Stock nor any fractional Right shall be issued and, in lieu
thereof, a cash payment shall be made pursuant to Section 2.5; and
(ii) cash in an amount equal to 1/59,000 of the Cash
Payment.
The shares of BAC Common Stock, the Rights, the cash payments in lieu of
fractional shares of BAC Common Stock and fractional Rights, and the additional
cash to be received by the Sellers pursuant to the Merger are hereinafter
collectively referred to as the "Merger Consideration". At the Effective Time,
all shares of Company Stock, by virtue of the Merger and without any further
action on the part of the Sellers, shall no longer be outstanding, shall be
canceled and retired and shall cease to exist, and each holder of a certificate
formerly representing any such shares shall thereafter cease to have any rights
with respect to such shares of Company Stock, except the right to receive the
Merger Consideration for such shares of Company Stock in accordance with
Section 2.4.
(b) At the Effective Time, the number of shares of BAC
Common Stock to be issued upon conversion of each share of Company Stock (the
"Exchange Ratio") shall be a number determined by dividing the Conversion
Amount by the average closing price of BAC Stock as reported on the New York
Stock Exchange Composite Tape for the 10 successive trading days ending five
trading days prior to the Closing Date (the "BAC Conversion Price"). The
Conversion Amount shall be 1/59,000 of the difference between the Purchase
Price and the Cash Payment.
(c) If after the date hereof and prior to the Effective
Time BAC shall have declared a stock split (including a reverse split) of BAC
Common Stock or a dividend payable in BAC Common Stock, or any other
distribution to holders of BAC Common Stock with respect to their BAC Common
Stock (including without limitation such a distribution made in connection with
a merger, consolidation, reorganization or other business combination) other
than regularly declared quarterly cash dividends (as such dividends may be
increased from time to time by BAC), then the number of shares of BAC Common
Stock to be issued upon conversion of a share of Company Stock pursuant to
Section 2.2(b) shall be appropriately adjusted (pursuant to the appropriate
adjustment of all relevant share amounts and all relevant dollar amounts) to
reflect such stock split, dividend or other distribution.
<PAGE> 7
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(d) Purchaser shall reimburse each Seller, upon
submission of paid brokerage fee invoices, for any brokerage fees incurred by
such Seller for the sale, on or prior to the tenth day following the Closing
Date, of BAC Common Stock having an aggregate value (determined using the BAC
Conversion Price) of up to $625,000.00 each, provided that the aggregate amount
of such reimbursement shall not exceed $500.00 to each Seller.
2.3 Conversion of Purchaser Common Stock. At the Effective Time,
each share of common stock, no par value, of Purchaser issued and outstanding
immediately prior to the Effective Time shall, by virtue of the Merger and
without any action on the part of the holder thereof, be converted into one
share of Company Stock.
2.4 Delivery of Merger Consideration; Adjustment of Merger
Consideration. The Merger Consideration will be delivered as follows: On the
Closing Date, in return for delivery of the Company Stock, each Seller will
receive the entire Merger Consideration to which he is entitled except as
provided in the next following sentence. Of the Cash Payment, (i) the total
amount owing to DCI pursuant to the DCI Settlement Agreement shall be paid, by
wire transfer, to DCI, to such account as each DCI shall specify in writing to
Purchaser, (ii) Fifty Thousand Dollars ($50,000.00) (the "Retention") shall be
retained by Purchaser pending determination of the actual Purchase Price
Adjustment, and (iii) the balance shall be delivered by wire transfer payable
to the Sellers, respectively, pro rata in accordance with their ownership of
Company Stock, to such account as each Seller shall specify in writing to
Purchaser. The Retention, plus the amount, if any, by which the Purchase Price
Adjustment as determined in connection with preparation of the Closing Balance
Sheet is less than the estimate of the Purchase Price Adjustment agreed to by
Purchaser and the Sellers on the Closing Date or less the amount, if any, by
which the Purchase Price Adjustment as determined in connection with
preparation of the Closing Balance Sheet is greater than the estimate of the
Purchase Price Adjustment agreed to by Purchaser and the Sellers on the Closing
Date, together with interest thereon from the Closing Date through the date of
delivery thereof at a rate of eight percent (8%) per annum, shall be delivered
to the Sellers, pro rata in accordance with their ownership of Company Stock as
of immediately prior to the Closing, at such time as the Purchase Price
Adjustment has been finally determined.
2.5 Transfers After the Effective Time. No transfers of shares of
Company Stock shall be made on the stock transfer books of the Surviving
Corporation at or after the Effective Time.
2.6 Fractional Shares. No fractional share of BAC Common Stock
and no fractional Right in respect thereof shall be issued in the Merger. Each
Seller shall be entitled to receive in lieu of any fractional share of BAC
Common Stock and any fractional Right to which such Seller otherwise would have
been entitled pursuant to Section 2.2 a cash payment in an amount equal to the
product of (i) the fractional interest of a share of BAC Common Stock to which
such holder otherwise would have been entitled and (ii) the BAC Conversion
Price. Payment of such amounts shall be made as part of the second installment
of the Merger Consideration.
<PAGE> 8
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3. REPRESENTATIONS AND WARRANTIES
3.1 Representations and Warranties of the Sellers and the Company.
Each Seller and the Company, jointly and severally, makes the following
representations and warranties to Purchaser. Certain matters disclosed on
Schedules hereto may not be required to be disclosed hereby, but may be stated
therein for information purposes only, and no such disclosure shall constitute
an indication or admission of the materiality thereof or create a standard of
disclosure, and no representation or warranty shall be deemed to have been made
by virtue of any disclosure made on, or contained in, any Schedule hereto
except to the extent expressly made in this Article 3.
3.1.1 Corporate Organization and Qualification. The
Company is a corporation duly organized and validly existing under the laws of
the State of Indiana and is qualified to do business as a foreign corporation
in each jurisdiction where the properties owned, leased or operated, or the
business conducted, by it require such qualification. The Company has the
corporate power and authority to carry on its business as it is now being
conducted. The Company has heretofore made available to the Purchaser a true,
complete and correct copy of the Company's Articles of Incorporation, as
amended to date, and the Company's By-Laws, as amended to date, and a
certificate of existence from the State of Indiana and good standing
certificates or other comparable certificates from each other jurisdiction in
which the Company is qualified to do business. The Company's Certificate of
Incorporation and By-Laws so made available are in full force and effect as of
the date hereof. The Company has no subsidiaries. Schedule 3.1.1 sets forth
each of the jurisdictions in which the Company is duly qualified, registered or
licensed to do business. The Company does not own, directly or indirectly, any
interest in any corporation, partnership or other legal entity.
3.1.2 Authorized Capital. The authorized capital stock of
the Company consists of 20,000,000 Common Shares, no par value, of which 59,000
shares are issued and outstanding, and 10,000 Preferred Shares, of which no
shares are issued and outstanding. 16,000 Common Shares and 500 Series A
Cumulative, Convertible Preferred Shares are held in the treasury of the
Company. All of the outstanding shares of Company Stock have been duly
authorized, validly issued and are fully paid and nonassessable, and were
issued in compliance with all applicable federal and state securities laws.
There are, and have been, no preemptive rights with respect to the issuance of
shares of Company Stock. Except as set forth above, there are no shares of
capital stock of the Company authorized, issued or outstanding, and there are
no outstanding subscriptions, options, warrants, rights, convertible
securities, or other agreements or commitments (whether contingent or not) of
any character relating to unissued capital stock or other securities of the
Company obligating the Company to issue any shares of or other equity interests
in, or securities or rights convertible into or exchangeable for shares of or
other equity interests in, the Company. Except for that certain Shareholder
Agreement dated February 4, 1990, among the Company and the Sellers, which
shall be terminated effective upon the Closing, there are no agreements or
understandings with respect to the voting, sale, transfer or registration of
any shares of capital stock of the Company.
3.1.3 Corporate Authority; Approval by the Sellers.
<PAGE> 9
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(a) Prior to the date of this Agreement, the Board of
Directors of the Company, pursuant to Section 23-1-40-3 of the IBCL, approved
this Agreement and the consummation of the transactions contemplated hereby.
The Company has the full power and authority to enter into this Agreement and
to consummate the transactions contemplated hereby, including without
limitation the Merger. The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby, including without
limitation the Merger, have been duly and validly authorized by all necessary
corporate action on the part of the Company. At a meeting duly called for such
purpose, the Board of Directors of the Company has approved the submission of
this Agreement to the holders of the Company Stock with a recommendation that
such holders vote in favor of the Merger.
(b) The Sellers have the power, authority and legal right
to execute, deliver and perform this Agreement. The Sellers, in their capacity
as shareholders of the Company, have given their approval to this Agreement and
have taken all other necessary actions for the approval of the transactions
contemplated hereby.
(c) This Agreement has been duly and validly executed and
delivered by each of the Company and the Sellers and constitutes a legal, valid
and binding agreement of each of the Company and the Sellers enforceable
against each of the Company and Sellers in accordance with its terms, except as
such enforceability may be limited by bankruptcy, insolvency and other similar
laws affecting rights of creditors generally and except to the extent that the
enforceability of the indemnification provisions set forth in Article 6 may be
limited by applicable law.
3.1.4 Ownership of Company Stock. Each Seller has good,
valid and marketable title to the number of shares of Company Stock set forth
next to his name below:
<TABLE>
<S> <C>
Damon Davis ...................... 29,500 shares
Richard Hauser ................... 29,500 shares
</TABLE>
Such shares held by the Sellers constitute one hundred percent of the issued
and outstanding Company Stock, and are held by the Sellers free and clear of
any mortgage, lien, claim, charge, pledge, security interest or encumbrance
whatsoever, with full and absolute right, power and authority to exchange such
stock as provided for herein.
3.1.5 Financial Statements. The audited balance sheets of
the Company as of December 31, 1993 and 1994, including the notes to the
financial statements in which such balance sheets are included (the balance
sheet as of December 31, 1994 is referred to hereinafter as the "Balance
Sheet") and the related statements of income and cash flows for the years then
ended, accurate and complete copies of all of which are attached as Schedule
3.1.5, have been, and the unaudited balance sheets of the Company as of July 2,
1995 and July 30, 1995, and as of the end of each four-week or five-week period
thereafter, as applicable consistent with the Company's past practices, until
the Closing and the related statements of income and cash flows for the monthly
periods then ended (copies of which shall be furnished to Purchaser within
three days after their preparation and in no event later than ten days prior to
the Closing Date) (collectively, the "Monthly Statements") have been or shall
be, prepared in accordance with
<PAGE> 10
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generally accepted accounting principles consistently applied throughout the
periods involved, and present, or shall present, fairly and accurately the
financial position of the Company and the results of its operations for the
periods then ended, subject to normal recurring adjustments for the Monthly
Statements.
3.1.6 Accounts Receivable. The accounts receivable of the
Company, as set forth on the Balance Sheet or arising since the date thereof,
have arisen in the ordinary course of business consistent with past practice
and are not subject to valid defenses, set-offs or counterclaims. All of such
accounts receivable are and shall be due within 30 days after being recorded on
the books of the Company and have been collected, or are and shall be
collectible, in full within 90 days after billing in the aggregate recorded
amounts thereof, less the amounts of the allowances for doubtful accounts and
sales returns reflected on the Closing Balance Sheet. The allowances for such
doubtful accounts and sales returns have been, and will be, determined in
accordance with generally accepted accounting principles consistent with the
Company's past practice.
3.1.7 Inventory. All inventory of the Company whether held
for rental, resale or for use as spare parts, consists substantially of a
quality, quantity and condition usable, leasable or saleable in the ordinary
course of business within the time periods consistent with the past experience
of the Company. None of the inventory of the Company is obsolete or
non-saleable, except where adequate reserves have been provided for in the
accounts of the Company.
3.1.8 Absence of Undisclosed Liabilities.
(a) The Company does not have any liabilities or
obligations, either accrued, absolute, contingent or otherwise, except:
(i) those liabilities or obligations reflected on
or provided for in the Balance Sheet or the Monthly Statements or disclosed in
the notes thereto and not heretofore paid or discharged;
(ii) those liabilities or obligations incurred,
consistent with past business practice, in or as a result of the normal and
ordinary course of business since December 31, 1994; and
(iii) liabilities specifically disclosed in this
Agreement.
For purposes of this Agreement, the term "liabilities" shall include, without
limitation, any direct or indirect indebtedness, guaranty, endorsement, claim,
loss, damage, deficiency, cost, expense, obligation or responsibility, fixed or
unfixed, choate or inchoate, liquidated or unliquidated, secured or unsecured.
(b) The Company has no liability arising out of any
termination or modification of, or change in compensation under, any contract
or agreement with any current or former sales agent, independent dealer or
employee.
<PAGE> 11
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3.1.9 Existing Condition. Except as disclosed on Schedule
3.1.9, since December 31, 1994, the Company has not:
(a) incurred any liabilities, other than liabilities
incurred in the ordinary course of business consistent with past practice, or
discharged or satisfied any lien or encumbrance, or paid any liabilities, other
than in the ordinary course of business consistent with past practice, or
failed to pay or discharge when due any liabilities of which the failure to pay
or discharge has caused or will cause any material loss or risk of material
loss to it or any of its assets or properties;
(b) sold, encumbered, assigned or transferred any of its
assets except in the ordinary course of business consistent with past practice;
(c) created, incurred, assumed or guaranteed any
indebtedness for money borrowed, or mortgaged, pledged or subjected any of its
assets to any mortgage, lien, pledge, security interest, conditional sales
contract or other encumbrance of any nature whatsoever;
(d) made or suffered any amendment or termination of any
agreement, contract, commitment, lease under which it is lessee, or plan to
which it is a party or by which it is bound, or canceled, modified or waived
any debts or claims held by it or waived any rights of substantial value in
connection therewith, whether or not in the ordinary course of business, except
where the value of such agreements, contracts, commitments, leases, debt or
claims does not exceed $5,000 in any one instance;
(e) suffered any damage, destruction or loss, whether or
not covered by insurance, or suffered any repeated, recurring or prolonged
shortage, cessation or interruption of supplies or utility or other services
required to conduct its business and operations;
(f) suffered any material adverse change in its business,
operations, assets (including, without limitation, Intellectual Properties, as
defined herein), properties, prospects or financial condition;
(g) received notice or had knowledge of any actual or
threatened labor trouble, strike or other occurrence, event or condition of any
similar character or received notice of any breach of any employment agreement
to which it is a party;
(h) made commitments or agreements for capital
expenditures, capital additions or betterments or leasehold improvements
exceeding in each case $25,000, except such as may be involved in ordinary
repair, maintenance or replacement of its assets;
(i) increased the salaries or other compensation of, or
benefits to, any employee, other than normal merit or cost of living increases
pursuant to, and in amounts consistent with, the general and past practice of
the Company, or made any advance (excluding advances for ordinary and necessary
business expenses and draws against commissions payable in the ordinary course
of business) or loaned to any of its employees, or made any changes to any
<PAGE> 12
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commission plan or arrangement or other benefits to which any employees may be
entitled except pursuant to the terms of any existing benefit plan disclosed in
Section 3.1.22;
(j) changed any of the accounting principles followed by
it or the methods of applying such principles;
(k) entered into any transaction for goods and/or
services with a value of $10,000 or more, other than in the ordinary course of
business consistent with past practice; or
(l) changed any material term of, increased the
compensation payable under, or terminated any, contract or agreement with any
dealer or agent except pursuant to the terms of such agreement.
3.1.10 Title to Properties; Liens.
(a) The Company has good, valid and marketable title to,
or the right to use under valid leases, licenses, permits or authorizations,
its properties and assets including, without limitation, those reflected in the
financial statements as of December 31, 1994 and not subsequently disposed of
in the ordinary course of business; and there are no liens, pledges, claims,
encumbrances, mortgages, security interests or other charges on such properties
and assets except for liens described in Schedule 3.1.10 and except for liens
for unpaid taxes which are not delinquent or which are being contested in good
faith by appropriate proceedings being diligently conducted.
(b) All leases as to which the Company is a party thereto
as lessee, licenses, permits and authorizations related to any assets or
properties used by the Company in the conduct of its business, and other
instruments, documents and agreements pursuant to which the Company has
obtained the right to use any real or personal property, are in good standing,
valid and effective in accordance with their respective terms, and there is not
under any such instrument, document or agreement any existing default or event
which, with notice or lapse of time, or both, would constitute a default (i) on
the part of the Company which would entitle the non-breaching party to damages,
or which would give such party the right to terminate the instrument, document
or agreement, or (ii) to the knowledge of either Seller or the Company, on the
part of any third party.
3.1.11 Condition of Tangible Assets. All buildings,
structures, facilities, equipment and other items of real or tangible personal
property of the Company, excluding inventory but including, without limitation,
all other items of real or tangible personal property reflected in the
financial statements of the Company as of December 31, 1994 and not
subsequently disposed of in the ordinary course of business, are in good
operating condition and repair, subject to normal wear and maintenance, are
usable in the regular and ordinary course of business, and conform in all
material respects to all applicable laws, ordinances, codes, rules and
regulations relating to their construction, use and operation.
3.1.12 Intellectual Properties.
<PAGE> 13
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(a) All patents, trademarks, trade names, service marks,
copyrights, software, firmware, trade secrets, know-how or any other forms of
intellectual property utilized by the Company (hereinafter referred to as
"Intellectual Properties"), except for those listed on Schedule 3.1.12, are
owned, possessed or lawfully used by the Company pursuant to good and valid
title or a valid and effective license or other valid and effective
arrangement. Each of the Company's registered or pending copyrights, patents,
trademarks and applications therefor is listed on Schedule 3.1.12. Any work
performed for the Company with respect to Intellectual Property qualifies as
"work for hire" under the federal Copyright Act, or if not, the Company has
obtained a proper assignment of title to such work or uses such work pursuant
to a valid and effective license or release.
(b) All Intellectual Properties utilized by the Company
have been protected (but not necessarily registered) by copyright, patent,
trademark, or trade secret processes.
(c) All Intellectual Properties of the Company that have
been licensed to third persons (as licensees) have been licensed only pursuant
to license agreements which (i) are non-exclusive, (ii) protect the Company's
proprietary interest in the Intellectual Property and (iii) validly and
enforceably limit the licensee's right to damages or other remedy to repair or
replacement of such Intellectual Properties.
(d) The Company is not infringing upon or unlawfully or
wrongfully using any Intellectual Property or, to the knowledge of either
Seller or the Company, any trade secret, owned or claimed by another. Except
for the claim against the Company disclosed on Schedule 3.1.14, the Company is
not in default under, nor has the Company or either Seller received any notice
of any claim of infringement or any other claim or proceeding relating to, any
Intellectual Property or any agreement relating thereto, nor does the Company
or either Seller know of any facts upon which any such claim could reasonably
be based.
(e) The Company possesses complete working copies of all
software and firmware used in its business, together with copies of all related
manuals and other documentation.
3.1.13 Books of Account. The books, records and accounts of
the Company fairly and accurately reflect, in reasonable detail, the
transactions and the assets and liabilities of the Company. The Company has
not engaged in any transaction, maintained any bank account or used any of its
funds except for transactions, bank accounts and funds which have been and are
reflected in the normally maintained books and records of the business.
3.1.14 Litigation. Except as disclosed on Schedule 3.1.14,
no litigation, including any arbitration, investigation or other proceeding of
or before any court, arbitrator or governmental or regulatory official, body or
authority is pending or, to the best knowledge of either Seller or the
Company, threatened against the Company, nor does either Seller or the Company
know of any reasonably likely basis for any such litigation, arbitration,
investigation or proceeding. There is no suit, action or other proceeding, or
injunction or final judgment relating thereto, threatened or pending against
the Company or either Seller, before any court or
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governmental or regulatory official, body or authority in which it is sought to
restrain or prohibit or to obtain damages or other relief in connection with
this Agreement or the consummation of the transactions contemplated hereby, and
no investigation that might result in any such suit, action or proceeding is
pending or, to the best knowledge of either Seller or the Company, threatened.
The Company is not a party to or subject to the provisions of any judgment,
order, writ, injunction, decree or award of any court, arbitrator or
governmental or regulatory official, body or authority.
3.1.15 Compliance with Law; Licenses. Each Seller's
ownership of the Company Stock is in compliance with the law, and the Company
has complied in all respects with, and is not in violation in any respect of,
any federal, state or local law, ordinance, code, order or governmental rule or
regulation to which it is subject and has not failed to obtain or to adhere to
the requirements of any license, permit or authorization necessary to the
ownership of its assets or to the conduct of its business. The Company holds
all permits, franchises, easements, licenses, variances, exemptions, rights,
applications, filings, registrations, orders and other authorizations and
approvals from governmental authorities (collectively, the "Licenses") which
are necessary to conduct its operations in the manner heretofore conducted (the
"Company's Business"), free and clear of all liens, charges, encumbrances and
adverse claims except as described on Schedule 3.1.10 and in compliance with
all laws, rules, regulations, orders and decrees. All such Licenses are listed
and described on Schedule 3.1.15. All such Licenses were properly and validly
obtained in compliance with all rules and regulations relating thereto. The
Company is not in default, nor has it received any notice of any claim of
default, with respect to any License and no event has occurred with respect to
any of the Licenses which permits, or after notice or lapse of time or both
would permit, revocation or termination thereof or would result in any
impairment of the rights of the holder of such License. Except as otherwise
governed by law, all Licenses are renewable by their terms or in the ordinary
course of business without the need to comply with any special qualification
procedures or to pay any amounts other than routine filing fees. None of the
Licenses will be adversely affected by consummation of the transactions
contemplated hereby. No director, officer or employee of, or consultant to,
the Company or any affiliate of the Company, or any other person, firm or
corporation or, to the best of the Company's or either Seller's knowledge, any
former employee of, or consultant to, the Company or any affiliate of the
Company, owns or has any proprietary, financial or other interest (direct or
indirect) in any License which the Company owns, possesses or uses in the
operation of its business as now or previously conducted.
3.1.16 Validity of Contemplated Transactions. Except as
disclosed on Schedule 3.1.16, the execution and delivery of this Agreement by
the Sellers and the Company will not, and the consummation and performance by
each of the Sellers and the Company of the transactions contemplated hereby,
including, without limitation, the Merger will not, violate, conflict with or
result in the breach of any term, condition or provision of, or require the
consent of any other party to, or trigger any payment or the performance of any
obligation under, (a) any existing law, ordinance, or governmental rule or
regulation to which either Seller or the Company is subject, (b) any judgment,
order, writ, injunction, decree or award of any court, arbitrator or
governmental or regulatory official, body or authority which is applicable to
either Seller or the
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Company or any of its assets, (c) the charter documents and by-laws of the
Company, (d) any Company benefit plan described in Section 3.1.22 or (e) any
mortgage, indenture, agreement, contract, commitment, lease, plan, license,
permit, authorization or other instrument, document or understanding, oral or
written, under which either Seller or the Company may have rights or by which
either Seller, the Company or any of its assets may be bound or affected, or
which give any party with rights thereunder the right to terminate, modify,
accelerate or otherwise change the existing rights or obligations of either
Seller or the Company thereunder. No authorization, approval or consent of,
and no registration or filing with or notice to, any governmental or regulatory
official, body or authority is required by or on behalf of either Seller or the
Company in connection with the execution, delivery and performance of this
Agreement, other than the approval of the Merger by the Indiana Secretary of
State.
3.1.17 Restrictions. Except as disclosed on Schedule
3.1.17, neither of the Sellers nor the Company is a party to any indenture,
agreement, contract, commitment, lease, plan, license, permit, authorization or
other instrument, document or understanding, oral or written, or subject to any
charter or other corporate restriction or any judgment, order, writ,
injunction, decree or award which adversely affects or restricts the scope of
the business of the Company, the right of the Company to compete with any
person, or which may otherwise adversely affect or restrict the business,
operations, assets, properties or financial condition of the Company.
3.1.18 Conditions Affecting the Business. There is no fact,
development or threatened development with respect to the products, services,
lease arrangements, government permits, Licenses or other approvals, clients,
customers, facilities, Intellectual Properties, computer software, databases,
personnel, equipment vendors, suppliers, operations, assets or prospects of the
Company which is known to either Seller or the Company which is not public
information and which would adversely affect the business, operations or
prospects of the Company, other than such conditions as may affect as a whole
any industry of which the Company is a part or which now is, or hereafter may
become as a result of conduct of the Dataview project, applicable to Purchaser
or BADG. Neither of the Sellers nor the Company has any reason to believe that
any loss of any employees, agents, customers or suppliers or other advantageous
arrangement will result because of the Merger.
3.1.19 Insurance. The assets, properties, and operations of
the Company are insured under various policies of general liability and other
forms of insurance, all of which are set forth on Schedule 3.1.19, which
disclose the risks insured against, coverage limits and deductible amounts.
All such policies are in full force and effect in accordance with their terms
and there is no existing default or event which, with the giving of notice or
lapse of time or both, would constitute a default thereunder. Schedule 3.1.19
also contains a true and complete description of all outstanding bonds and
other surety arrangements issued or entered into by the Company.
3.1.20 Contracts and Commitments. Except as listed and
described on Schedule 3.1.20 or as described in the Company's financial
statements referred to in Section 3.1.5, and other than agreements terminable
by the Company upon notice of 30 days or less and without the necessity of
making any bonus, severance, additional compensation or other payment other
than
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for liabilities accrued irrespective of the termination, the Company is not a
party to any written or oral:
(a) agreement, contract or commitment with any present or
former employee or consultant or for the employment of any person including any
consultant, other than contracts which, by their terms, are terminable at will
without future liability to the Company;
(b) agreement, contract, commitment or arrangement with
any labor union or other representative of employees;
(c) agreement, contract or commitment for the future
purchase of, or payment for, supplies or products, or for the performance of
services by a third party, involving in any one case $40,000 or more;
(d) agreement, contract or commitment to sell or supply
products in excess of $40,000 or to perform services extending beyond one year;
(e) agreement, contract, lease or commitment not
otherwise expressly listed and described on any Schedule hereto and continuing
over a period of more than six months from the date hereof or exceeding $40,000
in value;
(f) commission, representative, distributorship or sales
agency agreement, contract or commitment;
(g) conditional sale agreement or lease under which the
Company is either purchaser or lessee;
(h) note, debenture, bond, trust agreement, letter of
credit agreement, loan agreement or other contract or commitment for the
borrowing or lending of money or agreement or arrangement for a line of credit
or guarantee, pledge or undertaking of the indebtedness of any other person;
(i) agreement, contract or commitment for any charitable
or political contribution;
(j) agreement, contract or commitment limiting or
restraining the Company or any successor thereto from engaging or competing in
any aspect of the business of the Company, or soliciting or employing employees
of any other person, nor to the knowledge of either Seller or the Company, is
any employee of the Company subject to any such agreement, contract or
commitment;
(k) license, franchise, distributorship or other
agreement which relates in whole or in part to any Intellectual Property,
including, without limitation, any patent, trademark, trade name, service mark
or copyright or to any ideas, technical assistance or other know-how of or used
by the Company;
<PAGE> 17
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(l) agreement, contract or commitment for the sale or
license of software and related equipment and devices;
(m) contract to sell or provide goods and/or services to
any party located outside of the United States of America, Canada and Mexico;
or
(n) other material agreement, contract or commitment not
made in the ordinary course of business.
Each of the agreements, contracts, commitments, leases, plans and other
instruments, documents and undertakings listed on Schedule 3.1.20, or not
required to be listed thereon because it is terminable by the Company upon 30
days or less notice, is valid and enforceable in accordance with its terms; the
Company is, and to the best knowledge of each Seller and the Company, all other
parties thereto are, in compliance in all material respects with the provisions
thereof; the Company is not, and to the best knowledge of each Seller and the
Company, no other party thereto is, in default in the performance, observance
or fulfillment of any material obligation, covenant or condition contained
therein; and no event has occurred which with or without the giving of notice
or lapse of time, or both, would constitute a default thereunder. No such
agreement, contract, commitment, lease, plan or other instrument, document or
undertaking, in the reasonable opinion of each Seller and the Company, either
contains any contractual requirement with which there is a reasonable
likelihood the Company or any other party thereto will be unable to comply.
All indebtedness of the Company for borrowed money may be prepaid for the
unpaid principal amount thereof together with interest at the stated rate until
the date of payment with no premium or penalty thereon.
3.1.21 Additional Information. Schedule 3.1.21 contains, to
the extent not described in another Schedule hereto, accurate lists and summary
descriptions of the following:
(a) all real property and interests in real property
owned, leased or otherwise held by the Company, specifying the address and
legal description of each property, the use of each property, a brief
description and the square footage of any structure on each property, which
properties are owned and which are leased and, with respect to the leased
property, specifying the identity and address of the lessor, the rental rate
and the unexpired term of the lease;
(b) the name and address of every bank and other
financial institution in which the Company maintains an account (whether
checking, savings or otherwise), lock box or safe deposit box, and the account
numbers and names of persons having signing authority or other access thereto;
and
(c) the names and titles of and current annual base
salary, commission rates or hourly rates for all employees of the Company.
3.1.22 Employee Benefit Plan and Compensation Matters.
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(a) Existence of Plans and Arrangements. Schedule 3.1.22
sets forth a complete and accurate list of the following plans which the
Company presently sponsors, maintains, supports, contributes to or is obligated
to contribute to: (i) any employee pension benefit plan (as defined in Section
3(2) of the Employment Retirement Income Security Act of 1974, as amended
("ERISA"); (ii) any employee welfare benefit plan (as defined in Section 3(1)
of ERISA); (iii) any private or public insurance program; or (iv) any other
plan, program, contract, fund, arrangement or practice (whether written or
unwritten) for the purpose of providing benefits to the employees, officers,
directors or other persons engaged in the business of the Company or any of
their dependents, spouses, or beneficiaries, whether for the benefit of a
single individual or for more than one individual, including, without
limitation, any incentive, bonus, stock bonus, stock purchase, deferred
compensation, excess benefit, "window" retirement benefit, severance benefit,
hospitalization expense or medical expense or health, life or disability
insurance, sick leave, vacation, holiday or other salary continuation
arrangement, or other benefit or compensation arrangement, policy,
understanding, or contract for employees, their dependents, spouses and/or
their beneficiaries (whether written or unwritten), or any type of plan having
as one of its primary purposes the provision of benefits or deferred
compensation to employees, officers or directors of the Company or their
spouses or dependents and/or beneficiaries. Schedule 3.1.22 sets forth a
complete and accurate list of all plans, programs, contracts, funds and
arrangements of the type listed in clauses (i)-(iv) above which, at any time in
the past, the Company has sponsored, maintained, supported, contributed to or
been obligated to contribute to. (The plans, programs, contracts, funds and
arrangements required to be listed in Schedule 3.1.22 are collectively referred
to as the "Designated Plans.") The Company has not previously sponsored,
maintained, supported, contributed to or been obligated to contribute to any
plan, program, contract, fund or arrangement of the type listed in clauses
(i)-(iv) above that is not listed in Schedule 3.1.22 or which sponsorship,
maintenance, support, contribution or obligation to contribute has given rise
to any liability or obligation unpaid or unfulfilled as of the Closing Date, or
will give rise to any present or future liability or obligation, on the part of
the Company or Purchaser.
The Company has heretofore made available to Purchaser true
and complete copies of each of the plans disclosed on Schedule 3.1.22 and all
related trusts, annuity contracts and summaries as in effect on the date
hereof.
(b) Multi-employer Plan Liability. As of the Closing
Date the Company cannot be liable for withdrawal liability obligations or plan
termination obligations with respect to any multi-employer plan as that term is
defined in Section 4001(a)(3) of ERISA by reason of the participation in any
multi-employer plan by the Company or any entity other than the Company.
(c) Affiliated Company Relationships. For purposes of
this Section 3.1.22 and Section 3.1.25, "the Company" shall mean and include
Howard W. Sams & Company, each of its subsidiaries, and each of their
respective predecessors, any former employer of any present or former employees
of Howard W. Sams & Company or its subsidiaries if such former employer (or the
assets of such former employer) was acquired by or merged into either Howard W.
Sams & Company or any of its subsidiaries (hereinafter "the Company or its
predecessors") and (a) each member of each controlled group of corporations
within the meaning of Section 414(b) of the
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Code or Section 4001 of ERISA of which the Company or its predecessors is or
were members, (b) each member of each group of trades or businesses under
common control within the meaning of Section 414(c) of the Code of which the
Company or its predecessors is or were members and (c) each member of each
affiliated service group within the meaning of Section 414(m) of the Code of
which the Company or its predecessors is or were members.
(d) Employee Communications. The Company has not made
and will not prior to the Closing, without the prior written consent of
Purchaser, make any communication, in any form, to employees of the Company
indicating (a) any increases in any employee benefits with respect to any
Designated Plan, or (b) what employee benefits, if any, such employees may
receive from Purchaser or the Company after the Closing Date.
(e) Post-Employment Medical and Life. Except as
disclosed on Schedule 3.1.22, the Company does not provide, has never provided,
and is not obligated to provide any post-employment medical or life insurance
benefits for any present or former employees.
(f) Compliance with Law. Each Designated Plan and each
related trust, annuity contract or other funding vehicle is in all respects in
material compliance with, and is and has been operated in accordance with, all
(and the Company has not received any written claim or notice that any such
Plan is not in compliance with any) applicable governmental laws and
ordinances, orders, rules and regulations and prohibited transaction
exemptions.
(g) Payment of Premiums and Contributions. Each
Designated Plan is properly and fully funded in accordance with all rules and
regulations applicable to such Plan and the Company has paid or will pay the
premiums under all insured programs covering its employees for coverage through
the Closing Date which are required to be paid on or before the Closing Date.
The Company has paid or will pay under each Designated Plan covering its
employees all contributions due with respect to the service of such employees
prior to the Closing Date which are required to be paid on or before the
Closing Date. The Company is not delinquent with respect to any such
contributions. There are no circumstances pursuant to which the Company may be
liable to the Pension Benefit Guaranty Corporation ("PBGC") with respect to any
defined benefit pension plan sponsored or previously sponsored by any entity
other than Howard W. Sams & Company.
(h) Claims Liability. Neither the Seller nor the Company
has any knowledge of any action, claim or demand of any kind brought or
threatened by any potential claimant or representative of such claimant under
any Designated Plan where the Company may be either (i) liable directly on such
action, claim or demand; or (ii) obligated to indemnify any person, group of
persons or entity with respect to such action, claim or demand. The Company is
not in default under any obligation under any Designated Plan or the related
trusts, annuity contracts or funding vehicles thereunder nor has the Company
done or committed any act which, with notice or lapse of time or both, will
become a default under any obligation to be performed thereunder.
(i) Labor Agreements. The Company is not a party to any
collective bargaining agreement with, and no employees of the Company are
otherwise represented by, any
<PAGE> 20
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labor union or other representative of employees, nor does any collective
bargaining agreement or union determine the terms or conditions of employment
of any employee of the Company. Except as disclosed on Schedule 3.1.22, all
employees of the Company may be terminated "at will" by the Company, subject to
generally recognized limitations on the ability to terminate employees for
wrongful reasons, including without limitation for violation of
anti-discrimination laws.
(j) Fiduciary Appointments and Conduct. To the best
knowledge of each Seller and the Company, there has not occurred any
circumstance by reason of which the Company or Purchaser may be liable for:
(i) appointment by the Company of any person or
entity as a fiduciary with respect to any Designated Plan where such person or
entity was legally disqualified from serving in such capacity;
(ii) failure by the Company to monitor the
performance of its appointees as fiduciaries with respect to any Designated
Plan or failure of the Company to replace timely any such fiduciary whose
performance failed to meet the standards imposed by law with respect to
fiduciary duties; or
(iii) action taken by a fiduciary with respect to
any Designated Plan upon the direction of, or with the acquiescence of, the
Company.
(k) Reporting and Disclosure. The Company has filed or
caused to be filed on a timely basis each and every return, report, statement,
notice, declaration and other document required by any governmental agency with
respect to each Designated Plan.
(l) Participant and Beneficiary Notifications. With
respect to each Designated Plan, the Company has delivered or caused to be
delivered to every participant, beneficiary and other party entitled to such
material, all returns, reports, schedules, notices, statements and similar
materials including, without limitation, summary plan descriptions, summary
annual reports, individual reports of accrued benefits and documentation in
connection with denied claims for benefits (where applicable) as are required
by law, subject to any extension duly granted for the filing of any disclosure,
summary plan description, annual report, accounting or other form.
(m) COBRA.
(i) At all times prior to the date hereof, the
Company has complied with all applicable provisions of Code Section 4980(f) and
ERISA Sections 601 through 608, and proposed regulations thereunder (such
statutory and regulatory provisions are collectively referred to herein as
"COBRA").
(ii) The Company has delivered to Purchaser on or
before the date hereof a true and complete copy of (A) each of the forms of
notices that the Company has delivered from time to time to employees and
beneficiaries, and (B) all plan documents, summary plan descriptions, and
procedural guidelines utilized by the Company, to comply with the
<PAGE> 21
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requirements of COBRA, and the Company has adhered in all respects to the terms
of such procedural guidelines, plan documents and summaries.
(iii) Except as disclosed on Schedule 3.1.22, as of
the date hereof: (A) there are no qualified beneficiaries currently receiving
continuation coverage from the Company under COBRA, (B) there are no pending
claims for continuation coverage under COBRA, (C) there are no qualifying
events for which the Company has an obligation to deliver any notice or take
other action under COBRA, and (D) there are no allegations of violations of
COBRA by the Company which have been presented in writing or asserted orally by
any employee or beneficiary, or by the Internal Revenue Service or the
Department of Labor.
(n) Other Matters. Except as disclosed on Schedule
3.1.22:
(i) no filing with the PBGC or Internal Revenue
Service for termination or partial termination and no proceeding by the PBGC
for termination or partial termination of any Designated Plan has occurred or
been commenced;
(ii) to the best knowledge of each Seller and the
Company, no "prohibited transaction" as defined in Section 4975 of the Code has
occurred with respect to any Designated Plan;
(iii) no "reportable event" as defined in Section
4043(B) of ERISA for which notice to the PBGC is required under the rules and
regulations thereunder has occurred with respect to any Designated Plan;
(iv) to the best knowledge of each Seller and the
Company, no trustee, administrator, fiduciary or party in interest has taken
any action which would result in any liability for excise tax or otherwise
breached any fiduciary duty in connection with any Designated Plan;
(v) the Company does not maintain any plans,
employment contracts or other arrangements which would require the payment of
any "parachute payment" within the meaning of Section 280G of the Code; and
(vi) there will be no liability in respect of
severance or separation pay to any persons employed by the Company on the
Closing Date as a result of the consummation of this Agreement and the
transactions contemplated hereby.
3.1.23 Availability of Documents. Each Seller and the
Company have made available to Purchaser copies of all documents, including
without limitation all agreements, contracts, commitments, leases, plans,
instruments, undertakings, authorization, permits, licenses, patents,
trademarks, trade names, service marks, copyrights and applications therefor
and licenses for each of the foregoing listed on any Schedule hereto or
referred to herein. Such copies, as were provided, are true and complete in
all material respects and include all amendments, supplements and modifications
thereto or waivers currently in effect thereunder.
<PAGE> 22
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3.1.24 No Third Party Options. There are no existing
agreements, options, commitments, rights of first refusal or other rights with,
of or to any person to acquire any of the Company Stock, any other capital
stock of the Company, any of the Company's assets, properties or rights or any
interest therein.
3.1.25 Taxes.
(a) The Company has duly and timely filed all tax returns
required to be filed for all periods through and including the date hereof in
accordance with the provisions of law pertaining thereto, and has paid (or
collected and paid over) all federal, state, local, foreign and other taxes and
assessments (including, without limitation, income, withholding, excise,
unemployment, social security, occupation, transfer, franchise, property,
value-added taxes, sales and use taxes, import duties or charges, and all
penalties, interest and additions to tax in respect thereof) (collectively,
"Taxes") required to have been paid (or collected and paid over) to date and
required to be paid for all periods through and including the date hereof,
including any amount that may become due pursuant to any assessment, deficiency
notice, 30-day letter or similar notice, subject to any extension duly granted
for the filing of any return or for the payment of any Tax. All such Tax
returns are true, complete and correct.
(b) Except as disclosed on Schedule 3.1.25, (i) the
amounts shown for income taxes payable in the December 31, 1994 financial
statements and the Monthly Statements are sufficient for all accrued, deferred
and unpaid taxes as of such dates; (ii) there have been no examinations by the
appropriate taxing authorities of the Company's income, sales and use tax
returns, and the results of the examinations indicated on Schedule 3.1.25 are
fully reflected in the December 31, 1994 financial statements and the Monthly
Statements; (iii) there are no agreements, waivers or other arrangements
providing for an extension of time with respect to the filing of any Tax
returns by the Company or the payment by, or assessment against, the Company of
any Tax; (iv) there are no suits, actions, claims, investigations, inquiries or
proceedings pending or, to the best knowledge of either Seller or the Company,
threatened against the Company in respect of Taxes, or any matters under
discussion between the Company and any governmental authority relating to Taxes
asserted by any such authority; and (v) the Company has not been required at
any time to file any foreign Tax return and no foreign or international taxing
authority has jurisdiction to tax the income or operations of the Company.
(c) Neither the Company nor any of its current or former
employees has at any time participated in or cooperated in an international
boycott within the meaning of either Section 999 of the Code or the
Anti-Boycott Act.
(d) The Company is not and has not been a personal
holding company as defined in Section 542 of the Code, and is not and has not
been liable for the tax imposed on undistributed personal holding company
income by Section 541 of the Code.
(e) The Company has not consented nor has it filed a
consent within the six-month period preceding the Closing Date to be governed
by the provisions of Section 341(f) of the Code.
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(f) Neither the Company nor either Seller has taken any
action or failed to take any action, and neither will take any action or fail
to take any action which would require or cause Purchaser to make or be deemed
to have made an election to treat the purchase of the stock of the Company as a
purchase of assets pursuant to the provisions of Section 338 of the Code.
3.1.26 Environmental Matters. (a) No releases of Hazardous
Materials have occurred at or from any real property at any time owned or
leased by the Company or its predecessors or which was otherwise owned or used
at any time by the Company or its predecessors; (b) there are no past, pending,
or threatened Environmental Claims against the Company; (c) there are no
leaking underground storage tanks owned by the Company, or located at any
facility owned or operated by the Company; and (d) there are no facts,
circumstances, or conditions that could reasonably be expected to restrict,
under any Environmental Law or Environmental Permit in effect prior to or at
the Closing Date, the ownership, occupancy, use or transferability of any
property owned, operated, or leased by the Company. As used herein:
"Environmental Claims" means any and all administrative or
judicial actions, suits, orders, claims, liens, notices, violations or
proceedings related to any applicable Environmental Law or any Environmental
Permit brought, issued or asserted by: (i) a governmental authority for
compliance, damages, penalties, removal, response, remedial or other action
pursuant to any applicable Environmental Law; or (ii) a third party seeking
damages for personal injury or property damage resulting from the release of a
Hazardous Material at, to or from any facility of the Company, including but
not limited to the Company employees seeking damages for exposure to Hazardous
Materials;
"Environmental Laws" means all federal, state, and local laws,
statutes, ordinances, codes, rules and regulations related to protection of the
environment and/or the handling, use, generation, treatment, storage,
transportation, or disposal of Hazardous Materials;
"Environmental Permit" means all permits, licenses, approvals,
authorizations, or consents required by any governmental authority under any
applicable Environmental Law and includes any and all orders, consent orders or
binding agreements issued or entered into by a governmental authority under any
applicable Environmental Law; and
"Hazardous Material" means any hazardous or toxic substance,
material or waste which is regulated as of the Closing Date by any state or
local governmental authority or the United States, including, without
limitation, any material or substance that is: (i) defined as a "hazardous
substance" under applicable state law; (ii) petroleum; (iii) asbestos; (iv)
designated as a "hazardous substance" pursuant to Section 311 of the Federal
Water Pollution Control Act, as amended, 33 U.S.C. Section 1251 et seq. (33
U.S.C. Section 1321); (v) defined as a "hazardous waste" pursuant to Section
1004 of the federal Resource Conservation and Recovery Act, as amended, 42
U.S.C. Section 6901 et seq. (42 U.S.C. Section 6903); (vi) defined as a
"hazardous substance" pursuant to Section 101 of the Comprehensive
Environmental Response, Compensation and Liability Act, as amended, 42 U.S.C.
Section 9601 et seq. (42 U.S.C. Section 9601); (vii) defined as a "regulated
substance" pursuant to Section 9001 of the federal Resource Conservation and
Recovery Act, as amended, 42 U.S.C. Section 6901 et seq. (42 U.S.C. Section
6991); or (viii) otherwise regulated under the Toxic
<PAGE> 24
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Substances Control Act, 15 U.S.C. Section 2601, et seq., the Clean Air Act, as
amended, 42 U.S.C. Section 7401, et seq., the Hazardous Materials
Transportation Act, as amended, 49 U.S.C. Section 1801, et seq., or the Federal
Insecticide, Fungicide and Rodenticide Act, as amended, 7 U.S.C. Section 136,
et seq.
3.1.27 Creditors' Rights. This Agreement and the
transactions contemplated hereby are not subject to any law, ordinance or
governmental rule or regulation requiring notice to creditors.
3.1.28 Insolvency. Neither Seller nor the Company is the
subject of any existing, pending or threatened insolvency or bankruptcy
proceedings. The consummation of the transactions contemplated by this
Agreement will not result in either Seller or the Company being the subject of
such proceedings.
3.1.29 Dividends; Reduction of Capital Account. Except as
disclosed on Schedule 3.1.29, since December 31, 1994, the Company has not
declared, paid or set aside for payment any dividend or other distribution in
respect of its capital stock, nor has the capital account of the Company been
reduced to reflect the cancellation of any indebtedness of either Seller to the
Company.
3.1.30 Business in the Ordinary Course. Except as disclosed
on Schedule 3.1.30, since December 31, 1994, the business of the Company has
been conducted in the ordinary course consistent with past practice.
3.1.31 Employees and Business Relations. Since January 1,
1995, each Seller and the Company have used their best efforts to keep
available the services of the Company's present employees, customers and agents
and to maintain good relations with the Company's distributors and vendors and
any others having business relations with the Company.
3.1.32 Consents, Approvals and Notifications. Except as
disclosed on Schedule 3.1.32, no consents or approvals are required from or by
the holders of any indebtedness of the Company, the lessors or lessees of any
real or personal property or assets leased by the Company, the parties (other
than the Company) to any contract, commitment or agreement to which the Company
is a party or subject, any governmental or regulatory official, body or
authority or any labor committees or group, if applicable, or any other person
which owns or has authority to grant any License and any governmental, judicial
or regulatory official, body or authority having jurisdiction over either
Seller, the Company or Purchaser, under the pertinent debt, lease, contract,
commitment or agreement or other document or instrument or under applicable
orders, laws, rules or regulations, for the consummation of the transactions
contemplated hereby in the manner herein provided.
3.1.33 Indebtedness of Sellers. There is no outstanding
indebtedness of either Seller, or of any relative of either Seller, to the
Company.
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3.1.34 Registration Statement and Prospectus. None of the
information relating to the Company and the Sellers provided by the Company
and/or either Seller for inclusion in the Registration Statement on Form S-4
(and any amendments thereto) to be filed by BAC with the Securities and
Exchange Commission (the "SEC") pursuant to the Securities Act of 1933, as
amended (the "Securities Act"), to register the shares of BAC Common Stock
constituting part of the Merger Consideration (the "Registration Statement"),
and the prospectus to the Registration Statement, will, at the effective time
of the Registration Statement or at the Closing Date, be false or misleading
with respect to any material fact, or omit to state any material fact required
to be stated therein or necessary in order to make the statements therein, in
light of the circumstances under which they are or were made, not misleading.
3.1.35 Completeness of Disclosure. No representation or
warranty by either Seller or the Company in this Agreement nor any certificate,
schedule, statement, list, document or instrument furnished or to be furnished
to the Purchaser pursuant hereto contains or will contain (at the time
furnished or deemed repeated) any untrue statement of a material fact or omits
or will omit (at the time furnished or deemed repeated) to state a material
fact required to be stated herein or therein or necessary to make any statement
herein or therein not misleading or necessary to complete and correct
presentation of all material aspects of the Company's business and financial
position.
3.2 Representations and Warranties of Purchaser. Purchaser
represents and warrants to each Seller and the Company as follows:
3.2.1 Corporate Existence. Purchaser is a corporation duly
organized and validly existing under the laws of the State of Indiana.
3.2.2 Corporate Power and Authorization. Purchaser has the
corporate power, authority and legal right to execute, deliver and perform this
Agreement. The execution, delivery and performance of this Agreement by
Purchaser have been duly authorized by all necessary corporate action. This
Agreement has been duly executed and delivered by Purchaser, and constitutes
the legal, valid and binding obligation of Purchaser enforceable against
Purchaser in accordance with its terms, except as such enforceability may be
limited by bankruptcy, insolvency and other similar laws affecting rights of
creditors generally and except to the extent that the enforceability of the
indemnification provisions set forth in Article 6 may be limited by applicable
law.
3.2.3 Validity of Contemplated Transactions. The
execution, delivery and performance of this Agreement by Purchaser will not
violate, conflict with or result in the breach of any term, condition or
provision of, or require the consent of any other party to, (a) any existing
law, ordinance, or governmental rule or regulation to which Purchaser is
subject, (b) any judgment, order, writ, injunction, decree or award of any
court, arbitrator or governmental or regulatory official, body or authority
which is applicable to Purchaser, (c) the charter documents or By-Laws of, or
any securities issued by, Purchaser, or (d) any mortgage, indenture, agreement,
contract, commitment, lease, plan, license, permit, authorization or other
instrument, document or understanding, oral or written, to which Purchaser is a
party or by which Purchaser is otherwise
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bound. No authorization, approval or consent of, and no registration or filing
with or notice to, any governmental or regulatory official, body or authority
is required in connection with the execution, delivery and performance of this
Agreement by Purchaser.
3.2.4 Litigation. There is (a) no suit, action or claim,
(b) no investigation or inquiry by any administrative agency or governmental
body, and (c) no legal, administrative or arbitration proceeding pending or, to
the best of Purchaser's knowledge, threatened against Purchaser which seeks to
terminate or modify or which might affect this Agreement or the consummation of
the transactions contemplated herein.
3.3 Survival of Representations and Warranties. All
representations and warranties made by the parties in this Agreement or in any
certificate, schedule, statement, document or instrument furnished hereunder or
in connection with the negotiation, execution and performance of this Agreement
shall survive (a) in the case of the Company, to the Closing, and (b) in the
case of Purchaser and each Seller, on and after the Closing for a period of one
year, except that the Sellers' representations made in Section 3.1.12 shall
survive for a period of three years and the Sellers' representations made in
Sections 3.1.4, 3.1.22, 3.1.25 and 3.1.26 shall survive until the expiration of
any applicable statute of limitations. Notwithstanding any investigation or
audit conducted before or after the Closing Date or the decision of any party
to complete the Closing, each party shall be entitled to rely upon the
representations and warranties set forth herein and therein.
4. AGREEMENTS PENDING CLOSING
4.1 Agreements of Sellers and the Company Pending the Closing.
Each Seller and the Company jointly and severally covenant and agree that,
pending the Closing and except as otherwise agreed to in writing by Purchaser:
4.1.1 Conduct of Business. The business of the Company
shall be conducted solely in the ordinary course consistent with past practice.
The Company shall conduct its business in such a manner that, on the Closing
Date, the representations and warranties contained in this Agreement shall be
true as though such representations and warranties were made on and as of such
date. Furthermore, the Sellers shall cooperate with Purchaser and use their
best efforts to cause all of the conditions to the obligations of Purchaser and
the Sellers under this Agreement to be satisfied on or prior to the Closing
Date.
4.1.2 Existing Condition. The Sellers and the Company
shall not cause nor, to the extent within their power, permit to occur any of
the events or occurrences described in Section 3.1.9.
4.1.3 Maintenance of Physical Assets. The Company shall
continue to maintain and service the physical assets used in the conduct of its
business in the same manner as has been its consistent past practice subject to
customary policies of retirement and obsolescence.
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4.1.4 Employees and Business Relations. The Company shall
use its best efforts to keep available the services of the Company's present
employees, consultants, customers and agents and to maintain the Company's
distributors and vendors and any others having business relations with the
Company.
4.1.5 Maintenance of Insurance. The Company shall maintain
in effect the insurance policies and binders referred to on Schedule 3.1.19.
4.1.6 Maintenance of Authorizations, Etc. The Company
shall take all action necessary to comply with and maintain all Licenses of the
Company, and shall maintain in full force and effect all patents, trademarks,
patent and trademark applications, copyrights, franchises, licenses, permits,
easements, rights and other authorizations currently in effect and used in the
conduct of its business.
4.1.7 Compliance with Laws, Etc. The Company shall comply
in all respects with all laws, ordinances, rules, regulations and orders
applicable to it or its operations, assets or properties.
4.1.8 Dividends. The Company shall not declare, pay or set
aside for payment any dividend or other distribution in respect of its capital
stock.
4.1.9 Access. The Company shall give to Purchaser's
officers, employees, counsel, accountants and other representatives free and
full access to and the right to inspect, during normal business hours, all of
the premises, properties, assets, records, contracts and other documents of or
relating to the Company and shall permit them to consult with the officers,
employees, accountants, counsel and agents of the Company for the purpose of
making such investigations as Purchaser shall desire to make, provided that
such investigations shall not unreasonably interfere with the Company's
business operations. Furthermore, the Sellers and the Company shall furnish to
Purchaser, and shall cause their counsel, accountants and other representatives
to furnish to Purchaser, all such documents and copies of documents and records
and information and copies of any working papers relating thereto as Purchaser
shall from time to time reasonably request and shall permit Purchaser and its
agents to make such physical inventories and inspections of its assets as
Purchaser may request from time to time.
4.1.10 Non-solicitation. From the date hereof until this
Agreement is terminated pursuant to Section 8.1, neither the Company nor either
Seller will, directly or indirectly (i) sell, agree to sell, solicit inquiries
or proposals or furnish any non-public information with respect to, or
participate in any negotiations or discussions concerning any acquisition or
purchase of, all or a substantial portion of the business or the assets or of
any equity interest in the Company, or any business combination with the
Company. The Company shall instruct its officers, directors, agents and
affiliates to refrain from doing any of the above. The Company and each Seller
agree to notify Purchaser immediately as any such inquiries or proposals are
received by, any such information is requested from, or any such negotiations
or discussions are sought to be initiated with, such person.
<PAGE> 28
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4.1.11 Press Releases. Except (a) as required by applicable
law, or (b) as is reasonably necessary in connection with the negotiation and
consummation of the transactions contemplated hereby, neither Seller nor the
Company shall make any public statement or releases concerning this Agreement
or the transactions contemplated hereby except as shall have been approved in
advance as to form and content by Purchaser, and except to such persons as have
been approved in advance by Purchaser, which approvals shall not be
unreasonably withheld. Notwithstanding the foregoing, the Company may disclose
this Agreement and the proposed Closing Date to Company employees, provided
that the Company instructs such employees and managers not to disclose to any
other person the information about this Agreement disclosed to them.
4.2 Agreements of Purchaser Pending the Closing. Purchaser
covenants and agrees that, pending the Closing and except as otherwise agreed
to in writing by the Company:
4.2.1 Actions of Purchaser. Purchaser will not knowingly
take any action which would result in a breach of any of its representations
and warranties hereunder. Furthermore, Purchaser shall cooperate with the
Sellers and use its best efforts to cause all of the conditions to the
obligations of Purchaser and the Sellers under this Agreement to be satisfied
on or prior to the Closing Date.
4.2.2 Press Releases. Except (a) as required by applicable
law and (b) as is reasonably necessary in connection with the due diligence
review of the Company's business as contemplated by Section 4.1.9 and the
negotiation and consummation of the transactions contemplated hereby, Purchaser
will not make any public statement or releases concerning this Agreement or the
transactions contemplated hereby except as shall have been approved in advance
as to form and content by the Company, which approval shall not be unreasonably
withheld.
4.3 Covenants of Purchaser, Sellers and Company.
4.3.1 The Registration Statement. As soon as practicable
after the date hereof but in no event more than thirty business days
thereafter, the Sellers, the Company and Purchaser shall take such reasonable
steps as are deemed necessary by BAC for the prompt preparation and filing by
BAC with the SEC of the Registration Statement. The foregoing shall include
without limitation: (a) obtaining and furnishing the information required to
be included therein, (b) after consultation with each other, responding
promptly to any comments made by the SEC with respect to the Registration
Statement and any preliminary version thereof, and (c) causing the Registration
Statement to become effective.
4.3.2 Non-disclosure. Except as may be required by law or
as may by required to carry out the terms of this Agreement, neither Seller,
the Company or Purchaser shall disclose the terms of this Agreement or the
details of their negotiations to any third party other than their respective
officers, directors, employees and those of their respective affiliates, agents
and advisors.
<PAGE> 29
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5. CONDITIONS PRECEDENT TO CLOSING
5.1 Conditions Precedent to Obligations of Purchaser. All
obligations of Purchaser under this Agreement are subject to the fulfillment or
satisfaction, prior to or at the Closing, of each of the following conditions
precedent, which may be waived in whole or in part by Purchaser:
5.1.1 Representations and Warranties True as of the Closing
Date. The representations and warranties of each Seller and the Company
contained in this Agreement or in any schedule, certificate or document
delivered to Purchaser pursuant to the provisions hereof (a) shall have been
true on the date hereof, and (b) shall be true in all material respects on the
Closing Date with the same effect as though such representations and warranties
were made as of such date.
5.1.2 Compliance with this Agreement. The Sellers and the
Company shall have performed and complied with all agreements and conditions
required by this Agreement to be performed or complied with by them prior to or
at the Closing.
5.1.3 Closing Certificates. Purchaser shall have received
a certificate from the Sellers and the President of the Company, dated the
Closing Date, certifying in such detail as Purchaser may reasonably request
that the conditions specified in Sections 5.1.1, 5.1.2, 5.1.5, 5.1.6, 5.1.7,
the last sentence of Section 5.1.9, and the last sentence of Section 5.1.16
have been fulfilled.
5.1.4 Opinion of Counsel for Sellers and the Company.
Counsel for the Sellers and the Company shall have delivered to Purchaser a
written opinion, dated the Closing Date, which shall be in the form of Exhibit
5.1.4, with only such changes as shall be in form and substance satisfactory to
Purchaser and its counsel.
5.1.5 No Threatened or Pending Litigation. On the Closing
Date, no suit, action or other proceeding, or injunction or final judgment
relating thereto, shall be threatened or be pending before any court or
governmental or regulatory official, body or authority in which it is sought to
restrain or prohibit or to obtain damages or other relief in connection with
this Agreement or the consummation of the transactions contemplated hereby, and
no investigation that might result in any such suit, action or proceeding shall
be pending or threatened.
5.1.6 Consents, Approvals and Notifications. The holders
of any indebtedness of the Company, the lessors or lessees of any real or
personal property or assets leased by the Company, the parties (other than the
Company) to any contract, commitment or agreement to which the Company is a
party or subject, any governmental or regulatory official, body or authority or
any labor committees or group, if applicable, or any other person which owns or
has authority to grant any franchise and any governmental, judicial or
regulatory official, body or authority having jurisdiction over either Seller,
the Company or Purchaser, including, without
<PAGE> 30
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limitation, those identified on Schedule 3.1.32, to the extent that their
consent or approval is required or necessary, or notification to them is
required, under the pertinent debt, lease, contract, commitment or agreement or
other document or instrument or under applicable orders, laws, rules or
regulations, for the consummation of the transactions contemplated hereby in
the manner herein provided, shall have granted such consent or approval or
shall have been given the required notification.
5.1.7 Material Adverse Changes. No event or events shall
have occurred since the date of this Agreement which shall have materially
adversely affected, or which can reasonably be expected in the future to
materially adversely affect, the business, operations, assets, properties or
prospects of the Company.
5.1.8 Approval of Counsel; Corporate Matters. All actions,
proceedings, resolutions, instruments and documents required to carry out this
Agreement or incidental hereto and all other related legal matters shall have
been approved on the Closing Date by counsel for Purchaser in the exercise of
their reasonable judgment. Each Seller and the Company shall also have
delivered to Purchaser such other documents, instruments, certifications and
further assurances as such counsel may reasonably require.
5.1.9 MFJ Compliance. Purchaser shall have satisfied
itself, in its sole discretion, that all parts of the business of the Company
as currently conducted and as can be anticipated in the future and all of the
Company's assets that are material to its business are permitted to Purchaser,
following the Closing, under the terms of the Modification of Final Judgment
entered in United States v. American Telephone & Telegraph Co., 552 F.Supp. 131
(D.D.C. 1982), as amended from time to time (the "MFJ"). If requested by
Purchaser prior to Closing, the Sellers shall have caused the Company to divest
itself of any direct or indirect interest in any entity, asset or line of
business which, in the judgment of Purchaser, in its sole discretion, is not
permitted to Purchaser pursuant to the MFJ. From and after the date of this
Agreement, the Company shall not engage in the provision of interexchange
services, or provide telecommunications equipment to carriers, or manufacture
customer premises equipment or telecommunications equipment, as such terms are
construed under the MFJ.
5.1.10 Employment Agreements. Each Seller shall have
executed an employment agreement in the form of Exhibit 5.1.10 (an "Employment
Agreement").
5.1.11 Registration Statement; "Blue Sky" Permits. The
Registration Statement shall have become effective, no stop order suspending
the effectiveness of the Registration Statement shall have been issued and no
proceedings for that purpose shall have been initiated or threatened by the
SEC. BAC shall have received all state securities laws or "blue sky" permits
and other authorizations necessary to issue the BAC Common Stock in exchange
for the shares of Company Stock and to consummate the Merger.
5.1.12 Rule 145. Each Seller shall have executed and
delivered to Purchaser a Rule 145 Letter in the form of Exhibit 5.1.12.
<PAGE> 31
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5.1.13 DCI Release. The DCI Settlement Agreement shall
remain in full force and effect, and shall not be amended or modified from the
form entered into on August 18, 1995.
5.1.14 Resignations. Each Seller shall have provided to
Purchaser a letter, signed by such Seller and dated effective as of the
Closing, resigning all positions held by such Seller as a director or officer
of the Company. In addition, Sellers shall have delivered to Purchaser letters
signed by Glenn Scolnick and Dennis Erwin and dated effective as of the
Closing, resigning their positions as directors of the Company.
5.1.15 Estimated Purchase Price Adjustment. Purchaser and
the Sellers shall have agreed on a good faith estimate of the Purchase Price
Adjustment, as provided in Section 2.1(a).
5.1.16 Termination of Shareholder Agreement. The
Shareholder Agreement referred to in Section 3.1.2 shall have been terminated
by an instrument in form and substance reasonably satisfactory to Purchaser.
There shall be no further obligations of the Company to either Seller pursuant
to such Shareholder Agreement.
5.2 Conditions Precedent to the Obligations of Sellers. All
obligations of the Sellers under this Agreement are subject to the fulfillment
or satisfaction, prior to or at the Closing, of each of the following
conditions precedent, which may be waived in whole or in part by the Sellers:
5.2.1 Representations and Warranties True as of the Closing
Date. The representations and warranties of Purchaser contained in this
Agreement or in any schedule, certificate or document delivered by Purchaser to
the Sellers pursuant to the provisions hereof (a) shall have been true on the
date hereof, and (b) shall be true in all material respects on the Closing Date
with the same effect as though such representations and warranties were made as
of such date. Notwithstanding any other provision of this Agreement to the
contrary, at the Closing, Purchaser shall pay to the Sellers any and all
amounts that would be due to the Sellers as a result of Purchaser's
representations and warranties not being true on the date hereof.
5.2.2 Compliance with this Agreement. Purchaser shall have
performed and complied with all agreements and conditions required by this
Agreement to be performed or complied with by it prior to or at the Closing.
5.2.3 Closing Certificate. The Sellers shall have received
a certificate from Purchaser dated the Closing Date certifying in such detail
as the Sellers may reasonably request that the conditions specified in Sections
5.2.1, 5.2.2, 5.2.4, 5.2.6 and 5.2.8 have been fulfilled.
5.2.4 No Threatened or Pending Litigation. On the Closing
Date, no suit, action or other proceeding, or injunction or final judgment
relating thereto, shall be threatened or be pending before any court or
governmental or regulatory official, body or authority in which it is sought to
restrain or prohibit or to obtain damages or other relief in connection with
this
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Agreement or the consummation of the transactions contemplated hereby, and no
investigation that might result in any such suit, action or proceeding shall be
pending or threatened.
5.2.5 Approval of Counsel; Corporate Matters. All actions,
proceedings, resolutions, instruments and documents required to carry out this
Agreement or incidental hereto and all other related legal matters shall have
been approved on the Closing Date by counsel for the Sellers in the exercise of
their reasonable judgment. Purchaser shall also have delivered to the Sellers
such other documents, instruments, certifications and further assurances as
counsel for the Sellers may reasonable require.
5.2.6 Consents and Approvals. The holders of any
indebtedness of Purchaser, the lessors or lessees of any real or personal
property or assets leased by the Purchaser, the parties (other than the
Purchaser) to any contract, commitment or agreement to which the Purchaser is a
party or subject, any governmental, judicial or regulatory official, body or
authority, or any labor committees or group, if applicable, having
jurisdiction over the Purchaser to the extent that their consent or approval is
required or necessary under applicable orders, laws, rules or regulations for
the consummation of the transactions contemplated hereby in the manner herein
provided, shall have granted such consent or approval.
5.2.7 Employment Agreements. The Company shall have
executed and delivered to each of the Sellers their respective Employment
Agreements.
5.2.8 Registration Statement; "Blue Sky" Permits. The
Registration Statement shall have become effective, no stop order suspending
the effectiveness of the Registration Statement shall have been issued and no
proceedings for that purpose shall have been initiated or threatened by the
SEC. BAC shall have received all state securities laws or "blue sky" permits
and other authorizations necessary to issue the BAC Common Stock in exchange
for the shares of Company Stock and to consummate the Merger.
5.2.9 Opinion of Counsel for Purchaser. Purchaser 's
general counsel shall have delivered to the Sellers a written opinion, dated
the Closing Date, which shall be in the form of Exhibit 5.2.9, with only such
changes as shall be in form and substance satisfactory to the Sellers and their
counsel.
5.2.10 Estimated Purchase Price Adjustment. Purchaser and
the Sellers shall have agreed on a good faith estimate of the Purchase Price
Adjustment, as provided in Section 2.1(a).
6. INDEMNIFICATION
6.1 General Indemnification Obligation. Purchaser agrees to
indemnify and hold harmless each Seller and the Sellers, jointly and severally,
agree to indemnify and hold harmless Purchaser, its directors, officers,
affiliates (including, without limitation, the Company), agents and employees,
and the directors, officers, agents and employees of Purchaser's affiliates
(including, without limitation, the Company) (each such indemnified party
hereinafter referred to
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as the "indemnified party" and each of Purchaser's officers, directors,
affiliates, agents and employees and the directors, officers, agents and
employees of Purchaser's affiliates hereafter referred to as a "Purchaser's
indemnified party") against any and all losses, costs, expenses, claims,
damages or liabilities (including the amount of any settlement approved by such
indemnifying party), and any expenses of enforcing this Agreement, which any
indemnified party may suffer, incur or become subject to, and to reimburse any
indemnified party for any reasonable legal or other expenses incurred by such
indemnified party in connection with investigating any claims and defending any
actions (collectively, "Claims"), insofar as such Claims arise out of or are
based upon (i) any false or untrue representation or the breach of any warranty
made by the indemnifying party in this Agreement or pursuant hereto or (ii) any
breach or default in performance by the indemnifying party of any covenant or
agreement in this Agreement or pursuant hereto, or insofar as such Claims
would, if meritorious, arise out of or be based upon any false or untrue
representation or the breach of any warranty made by the indemnifying party in
this Agreement or pursuant hereto. For purposes of this Article 6, the
Sellers' indemnification obligations hereunder shall also extend to any matter
described on Schedule 3.1.14, which matters should constitute "Claims", as well
as any misrepresentation, omission, breach or default on the part of the
Company or either Seller under this Agreement on or prior to the Closing Date.
6.2 Indemnification Procedures.
(a) Each indemnified party will, within 30 days after:
(i) the receipt of notice of a written threat or the commencement of any action
against such indemnified party in respect of which indemnity may be sought from
an indemnifying party on account of an indemnity agreement contained in this
Article 6; or (ii) the determination by Sellers, or either of them, on the one
hand, or Bell Atlantic Directory Graphics, Inc. ("BADG"), on the other hand,
based on a reasonable interpretation of facts then known to such person, that
such person or, in the case of BADG, a Purchaser's indemnified party, is
entitled to assert a claim pursuant to Section 6.1, (x) notify the indemnifying
party in writing thereof, stating, to the extent known, the name of the person
threatening or commencing such action, if applicable, and a statement setting
forth in reasonable detail, the basis for any claim of indemnity, and (y)
provide copies of any written notices or other correspondence relating to such
claim received from or delivered or sent to any adverse third party with
respect thereto. The omission of any indemnified party so to notify an
indemnifying party of any such action shall not relieve the indemnifying party
from any liability in respect of such action which it may have to such
indemnified party on account of the indemnity agreement contained in this
Article 6, except to the extent such indemnifying party can establish prejudice
or direct damages as a result thereof. In case any such action shall be
brought against any indemnified party and it shall notify an indemnifying party
in accordance herewith, the indemnifying party will be entitled to participate
therein, and, to the extent it may wish, to assume the defense thereof with
counsel reasonably satisfactory to such indemnified party, and after notice
from the indemnifying party to such indemnified party of its election so to
assume the defense thereof, the indemnifying party will not be liable to such
indemnified party under this Article 6 for any legal or other expenses
subsequently incurred by such indemnified party in connection with the defense
thereof other than reasonable costs of investigation prior to such assumption
of defense. After the indemnifying party has assumed the defense of a Claim
and has
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expressly agreed in a writing sent to the indemnified party that it is
responsible for such Claim, the indemnifying party may settle such Claim at its
sole liability and expense provided that:
(i) any such settlement includes a
complete release in favor of the indemnified party in form and substance
satisfactory to the indemnified party and its counsel; and
(ii) the terms and conditions of the
settlement do not, in the reasonable judgment of the indemnified party, impose
any burden, restraint, cost, liability, duty or other obligation on, or
otherwise adversely affect, or have the potential to adversely affect, the
indemnified party.
(b) Satisfaction of any indemnification claim against the
Sellers may, at Purchaser's option, be made by adjusting the salary of either
or both Sellers pursuant to section 3(a) of his or their Employment
Agreement(s) and to the extent allowable pursuant to the terms and conditions
thereof.
(c) If (i) Purchaser retains any portion of the Retention
or salary payable to a Seller under his Employment Agreement as a result of a
Claim, (ii) either Seller disputes such Claim, and (iii) any or all of such
disputed amount is determined to be due to the disputing Seller by binding
arbitration, then such Seller shall also be entitled to receive interest on
such portion at a rate of eight percent (8%) per annum from and after the date
such Retention or salary would have been delivered to such Seller but for the
assertion of a Claim. Purchaser and the Sellers, as applicable, shall pay that
percentage of the arbitration costs and reasonable attorney's fees incurred by
the other party that is equal to the percentage of the amount in dispute that
is resolved in the favor of the other party.
6.3 Limitation on Liability. The liability of an indemnifying
party to any indemnified party under this Article 6 shall be subject to the
following limitations:
(a) No indemnifying party shall be obligated to indemnify
any indemnified party under this Article 6 for a Claim arising from a breach or
alleged breach of the indemnifying party's representation or warranty in this
Agreement if the indemnified party has not given the indemnifying party notice
of such Claim prior to the expiration of the survival period for such
representation or warranty as stated in Section 3.3. No such notice shall be
required for any matter described on (or any Claim arising out of or in
connection with a matter described on) Schedule 3.1.14.
(b) No indemnifying party shall be required to pay the
investigation expenses of an indemnified party except to the extent (i) such
investigation relates to a third-party claim against the indemnified party as
to which indemnification is sought hereunder, (ii) such expenses are limited to
the indemnified party's reasonable out-of-pocket costs and expenses(and do not
include salary or wages paid to the indemnified party's employees) and (iii)
the incurring of such expenses is approved, in advance, by the indemnifying
party, which approval shall not be withheld unreasonably.
<PAGE> 35
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(c) No indemnifying party shall be obligated to indemnify
any indemnified party under this Article 6 unless and until the aggregate of
Claims otherwise indemnifiable by such indemnifying party in the absence of
this subsection (c) exceeds Forty Thousand Dollars ($40,000.00), in which event
such amounts in excess of $40,000 (but only such amounts in excess) shall be
due. The maximum aggregate amount of indemnity by the Sellers pursuant to this
Article 6 shall be limited to the amount of the Purchase Price plus, as to each
Seller, the amount, if any, of the Pool (as defined in the Employment
Agreement) which such Seller becomes entitled to receive pursuant to his
Employment Agreement.
6.4 Tax Liabilities and Tax Audits.
(a) The Sellers shall be responsible for, and shall pay,
all Taxes imposed upon the Company for any period up to and including, the
Closing Date which are not provided for in the accounts of the Company, other
than any Taxes imposed upon the Company as a result of the Merger being held to
be not a tax-free reorganization under the Code for any reason other than
solely by reason of actions taken by the Sellers, or either of them.
(b) Purchaser shall give the Sellers notice of any
threatened or scheduled Tax audit for any year open for assessment of
deficiencies up to and including the Closing Date and shall give the Sellers
and the Sellers' accountants or agents the opportunity, at the Sellers' sole
cost and expense, to investigate, defend, settle and otherwise resolve, any
such audit, provided the Sellers first provide a written acknowledgment of
their liability hereunder. Notwithstanding the foregoing, Purchaser shall have
the right to be present at any such audit and to participate in any discussions
or negotiations with Tax authorities.
6.5 Other Rights and Remedies Not Affected. The indemnification
rights of the parties under this Article 6 for any misrepresentation, breach of
warranty or failure to fulfill any agreement or covenant hereunder on the part
of any party hereto are independent of and in addition to any equitable rights
or remedies, including without limitation specific performance and right to
rescission because of the other parties' misrepresentation fundamentally
affecting the character of the Company's business or fraud, and any rights or
remedies because of the other party's fraudulent action, none of which rights
or remedies shall be affected or diminished hereby.
6.6 Assistance in Resolving Claims. If an indemnifying party
wishes to assist in the resolution of a Claim other than through formal
assumption of defense, the indemnified party will give such indemnifying party
an opportunity to describe such assistance and will in its sole discretion
determine whether or not to accept such assistance, without prejudice to its
rights to indemnification hereunder.
6.7 Proceeds from Accounts Receivable and Inventory. In the event
that the Company makes an indemnification Claim against the Sellers which is
based on a breach of or the inaccuracy of the Sellers' or the Company's
representations and warranties set forth in Section 3.1.6 or Section 3.1.7 and
the Sellers make payment of such Claim (or if the Sellers execute an agreement
in writing with the Company that the amount of such Claim shall be applied
against the deductible amount provided for in Section 6.3(c)), then, to the
extent that the Company actually
<PAGE> 36
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receives payment of any account receivable or realizes proceeds from sale or
disposition of any item of inventory forming the basis for such Claim, the
Company will, within 60 days after receipt of such payment or proceeds, pay
over such proceeds to the Sellers to the extent of the amount of payment
received by the Company from the Sellers, respectively, with respect to such
Claim. If more than one Claim (of any type) is made on a single date, and such
Claims in the aggregate would cause the aggregate Claims made through such date
to exceed the deductible amount, then all such Claims shall be allocated
proportionately to deductible amount and to payable amount.
7. POST-CLOSING MATTERS
7.1 Maintenance of Books and Records. The Sellers and Purchaser
shall preserve for at least one year after the Closing Date (or for at least
five years with respect to matters for which the representations and warranties
survive for a period longer than one year) all records possessed or to be
possessed by such party relating to the Company prior to the Closing Date.
After the Closing Date, where there is a legitimate purpose, such party shall
provide the other party and its representatives with access, upon prior
reasonable written request specifying the need therefor, during regular
business hours, to (i) the Sellers or to the officers and employees of
Purchaser and (ii) the books of account and records of such party, but, in each
case, only to the extent relating to the Company prior to the Closing Date, and
the other party and its representatives shall have the right to make copies of
such books and records; provided, however, that the foregoing right of access
shall not be exercisable in such a manner as to interfere unreasonably with the
normal operations and business of such party; and further provided, that, as to
so much of such information as constitutes trade secrets or confidential
business information of such party or the Company, the requesting party and its
officers, directors and representatives will use due care not to disclose such
information except (i) as required by law, (ii) with the prior written consent
of such party, which consent shall not be unreasonably withheld, or (iii) where
such information becomes available to the public generally or becomes generally
known to competitors of such party, through sources other than the receiving
party, its affiliates or its officers, directors or representatives. The
foregoing notwithstanding, such records may nevertheless be destroyed by a
party if such party sends to the other party written notice of its intent to
destroy records, specifying with particularity the contents of the records to
be destroyed. Such records may then be destroyed after the 30th day after such
notice is given unless the other party objects to the destruction in which case
the party seeking to destroy the records shall deliver such records to the
objecting party.
7.2 Non-Disclosure Obligations. The Sellers, jointly and
severally, covenant and agree not to use for personal benefit nor to publish or
disclose to others, directly or indirectly, at any time, any confidential or
proprietary information of the Company. Each Seller specifically acknowledges
and agrees that the remedy at law for any breach of the foregoing covenant will
be inadequate, and that Purchaser, in addition to any other remedy available to
it, shall be entitled to temporary and permanent injunctive relief without the
necessity of proving actual damage.
<PAGE> 37
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8. MISCELLANEOUS
8.1 Termination.
(a) Anything herein or elsewhere to the contrary
notwithstanding, this Agreement may be terminated by written notice of
termination at any time before the Closing Date only as follows:
(i) by mutual consent of the Sellers and
Purchaser;
(ii) by Purchaser, at any time if the
representations and warranties of Company or the Sellers contained in Section
3.1 (A) were materially incorrect when made or (B) become materially incorrect
prior to Closing, or if the Sellers or the Company failed to comply in any
material respect with the covenants and obligations set forth in Article 4 and
such failure has not been cured within 20 business days after receiving written
notice of such failure from Purchaser;
(iii) by the Sellers, at any time if the
representations and warranties of Purchaser contained in Section 3.2 (A) were
materially incorrect when made or (B) become materially incorrect prior to
Closing, or if Purchaser failed to comply in any material respect with the
covenants and obligations set forth in Article 4 and such failure has not been
cured within 20 business days after receiving written notice of such failure
from the Sellers; or
(iv) by either Purchaser or the Sellers, if
Closing does not occur by September 30, 1995 through no fault of such
terminating party or its (and in the case of the Sellers, the Company's)
directors, officers or shareholders.
(b) In the event of the termination and abandonment
hereof pursuant to the provisions of this Section 8.1, this Agreement, other
than Section 4.3.2, shall become void and have no effect, without any liability
on the part of any of the parties or their directors or officers in respect of
this Agreement, except (x) if the termination arises under subsection (iii)
above, Purchaser shall be liable to the Company and the Sellers for all costs
and expenses in connection with the preparation, negotiation, execution and
performance of this Agreement, or (y) if the termination arises under
subsection (ii) above, the Company and the Sellers shall be jointly and
severally liable to Purchaser for all costs and expenses in connection with the
preparation, negotiation, execution and performance of this Agreement.
8.2 Broker's and Finder's Fees. Each of the parties hereto
represents and warrants to the other parties that all negotiations relative to
this Agreement have been carried on by it directly without the intervention of
any person who may be entitled to any brokerage or finder's fee or other
commission in respect of this Agreement or the consummation of the transactions
contemplated hereby, except that the Sellers have engaged DCI to act on their
behalf pursuant to the DCI Letter, and each party agrees to indemnify and hold
harmless the other party hereto
<PAGE> 38
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against any and all claims, losses, liabilities and expenses which may be
asserted against or incurred by it as a result of such party's dealings,
arrangements or agreements with any such person. Notwithstanding the
foregoing, the parties acknowledge and agree that the portion of the Cash
Payment which is being provided by Purchaser to DCI at the Closing is actually
a reduction of the amount of the Purchase Price payable to the Sellers, and
accordingly the Sellers shall not be required to indemnify Purchaser for having
made such payment. Except as provided in the immediately preceding sentence,
the Sellers shall be solely responsible and liable for all obligations and
amounts payable under the DCI Letter or the DCI Settlement Agreement,
notwithstanding that the Company is a party to the DCI Letter and the DCI
Settlement Agreement.
8.3 Sales, Transfer and Documentary Taxes. The Sellers shall pay
all sales, documentary, and other transfer taxes, if any, due as a result of
the merger in accordance herewith whether imposed by law on the Sellers or
Purchaser and the Sellers, jointly and severally, shall indemnify, reimburse
and hold harmless Purchaser in respect of the liability for payment of or
failure to pay any such taxes or the filing of or failure to file any reports
required in connection therewith.
8.4 Expenses. Except as otherwise provided in this Agreement, the
Sellers shall pay their own expenses, and to the extent incurred on or prior to
the Closing Date, the Company's expenses, and Purchaser shall pay its own
expenses, incidental to the preparation of this Agreement, the carrying out of
the provisions of this Agreement and the consummation of the transactions
contemplated hereby.
8.5 Contents of Agreement; Parties in Interest; Etc. This
Agreement sets forth the entire understanding of the parties hereto with
respect to the transactions contemplated hereby. It shall not be amended or
modified except by written instrument duly executed by each of the parties
hereto. Any and all previous agreements and understandings between or among
the parties regarding the subject matter hereof, whether written or oral, are
superseded by this Agreement.
8.6 Assignment and Binding Effect. This Agreement may not be
assigned prior to the Closing by any party hereto without the prior written
consent of the other party except that Purchaser may assign this Agreement to
any affiliate of Purchaser. Subject to the foregoing, all of the terms and
provisions of this Agreement shall be binding upon and inure to the benefit of
and be enforceable by the heirs, successors and assigns of the Sellers and
Purchaser.
8.7 Waiver. Any term or provision of this Agreement may be waived
at any time by the party entitled to the benefit thereof by a written
instrument duly executed by such party.
8.8 Notices. Any notice, request, demand, waiver, consent,
approval or other communication which is required or permitted hereunder shall
be in writing and shall be deemed effective as follows: (a) if mailed, three
days after such notice is sent via first class United States certified mail,
postage prepaid to the address listed below for the party to whom the notice is
being sent ("Notice Party"); (b) if hand delivered or delivered by courier,
upon actual delivery of such notice to the Notice Party at the address listed
below for such notice Party; or (c) if sent by
<PAGE> 39
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facsimile, on the date of the sender's receipt of a transmission confirmation
of such notice to the Notice Party at the facsimile number, if any, listed
below for such Notice Party, provided the party giving such notice mails a copy
of such notice, in accordance with clause (a) or clause (b) above, within two
days after the transmission of such Notice by facsimile to the Notice Party.
The addresses and facsimile numbers for each party to this Agreement, as of the
date hereof, are as follows:
Purchaser:
Bell Atlantic Directory Graphics, Inc.
2500 Monroe Boulevard
P.O. Box 80050
Valley Forge, Pennsylvania 19484-0050
Attention: President
Facsimile No. (610) 650-5025
With a required copy to:
Bell Atlantic Network Services, Inc.
1717 Arch Street, 32nd Floor
Philadelphia, Pennsylvania 19103
Attention: Elizabeth Sampath, Esq.
Facsimile No. (215) 963-9195
The Company:
Howard W. Sams & Company
2647 Waterfront Parkway East Drive
Indianapolis, Indiana 46214
Attention: Richard Hauser
Facsimile No. (317) 298-5442
The Sellers:
Damon Davis Richard Hauser
8909 Bay Breeze Lane 13720 Smoky Ridge Trace
Indianapolis, Indiana 46236 Carmel, Indiana 46033
Facsimile No. (None) Facsimile No. (None)
<PAGE> 40
- 39 -
With required copies to:
Robert J. Hicks, Esq.
Sommer & Barnard
4000 Bank One Tower
111 Monument Circle
Indianapolis, Indiana 46244
Facsimile No. (317) 236-9802
Any party may change his or its address or facsimile number by providing
written notice, in accordance with the foregoing provisions of this Section
8.8, to each other party of such change.
8.9 PENNSYLVANIA LAW TO GOVERN. THIS AGREEMENT SHALL BE GOVERNED
BY AND INTERPRETED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE COMMONWEALTH
OF PENNSYLVANIA, WITHOUT CONSIDERATION OF THE LAWS OF SUCH JURISDICTION
RELATING TO CONFLICTS OF LAW OR CHOICE OF LAW.
8.10 Arbitration.
(a) Any and all disputes or claims arising out of or
relating to the validity, interpretation, enforceability or performance of this
Agreement, including, without limitation, this arbitration clause, shall be
solely and finally settled by binding arbitration in Pittsburgh, Pennsylvania
(or such other location as the parties may otherwise agree) and except as
otherwise provided herein, in accordance with the then prevailing Commercial
Arbitration Rules of the American Arbitration Association ("AAA"); provided,
however, that in any case where AAA or its successors are not in existence, the
arbitration shall proceed in accordance with the laws relating to arbitration
then in effect in the Commonwealth of Pennsylvania.
(b) Either Seller, by written notice to the Purchaser (or
the Company if the notice is given after the Closing) and Bell Atlantic
Directory Graphics, Inc., or Purchaser, by written notice to both Sellers, may
demand that the disputed matter be submitted to arbitration. The demand notice
shall specify the nature of the dispute. An arbitrator shall be chosen in
accordance with the prevailing Commercial Arbitration Rules of AAA. The
arbitrator shall permit or prohibit discovery in his sole discretion and may
admit or exclude evidence in his sole discretion.
(c) The arbitrator shall decide the dispute or claim in
accordance with the then prevailing Commercial Arbitration Rules of AAA,
applying the substantive laws of Pennsylvania. Judgment upon the arbitral
award may be entered in any court having jurisdiction over the parties hereto
or their assets. No party may take any dispute or claim subject to arbitration
hereunder to any court until an arbitration decision has been made, except that
any party shall have the right to institute any legal actions for provisional
relief pending final settlement by arbitration.
<PAGE> 41
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(d) Each party shall pay its own expense of arbitration,
and the expenses of the arbitrator shall be equally shared between the
disputing parties; provided, however, that if in the opinion of the arbitrator
any claim or any defense or objection thereto was unreasonable, the arbitrator
may assess, as part of his award, all or any part of the arbitration expenses
of the other party (including reasonable attorneys' fees) and of the arbitrator
against the party raising such unreasonable claim, defense or objection.
(e) The resolution of such arbitration shall be final and
binding on the parties hereto and enforceable in a court of competent
jurisdiction.
8.11 Release. For good and valuable consideration, receipt of
which is hereby acknowledged, and intending to be legally bound, each Seller
hereby agrees as follows:
(a) Effective upon the Closing, and except for any
obligations of the Company or BADG under the Employment Agreements or this
Agreement, and the obligations of each Seller under that certain
Indemnification Agreement of even date herewith by and between the Sellers,
each Seller does hereby release and forever discharge the Company and its
directors, officers, employees and agents (the "Released Parties") and their
successors and assigns from all claims or causes of action of any type or
nature whatsoever, whether fixed, contingent, liquidated, unliquidated, choate
or inchoate, which such Seller ever had, now has or hereafter may have, against
the Released Parties, or any of them, arising out of or based on any event,
fact or circumstance occurring or existing on or prior to the Closing Date.
Seller expressly acknowledges that this Agreement is intended to include in its
effect, without limitation, all claims or causes of action which he does not
know of or suspect to exist in favor of him at the time of execution hereof,
and that this Agreement contemplates, except as provided above, the
extinguishment of any such claims or causes of action.
(b) Each Seller hereby acknowledges that he has read this
Section 8.11 and has consulted with his counsel concerning it, and understands
that this is a full and final release of all possible claims covered hereby.
8.12 No Benefit to Others. The representations, warranties,
covenants and agreements contained in this Agreement are for the sole benefit
of the parties hereto and, in the case of Article 6, the other indemnified
parties, and their heirs, executors, administrators, legal representatives,
successors and assigns, and they shall not be construed as conferring any
rights on any other persons.
8.13 Headings, Gender and "Person". All section headings contained
in this Agreement are for convenience of reference only, do not form a part of
this Agreement and shall not affect in any way the meaning or interpretation of
this Agreement. Words used herein, regardless of the number and gender
specifically used, shall be deemed and construed to include any other number,
singular or plural, and any other gender, masculine, feminine, or neuter, as
the context requires. Any reference to a "person" herein shall include an
individual, firm, corporation, partnership, trust, governmental authority or
body, association, unincorporated organization or any other
<PAGE> 42
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entity. Reference herein to sections, articles, schedules or exhibits shall be
deemed to be references to sections, articles, schedules or exhibits of this
Agreement unless otherwise specified.
8.14 Schedules and Exhibits. All Exhibits and Schedules referred
to herein are intended to be and hereby are made a part of this Agreement.
8.15 Severability. Any provision of this Agreement which is
invalid or unenforceable in any jurisdiction shall be ineffective to the extent
of such invalidity or unenforceability without invalidating or rendering
unenforceable the remaining provisions hereof, and such invalidity or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provisions in any other jurisdiction.
8.16 Counterparts. This Agreement may be executed in any number of
counterparts and any party hereto may execute any such counterpart, each of
which when executed and delivered shall be deemed to be an original and all of
which counterparts taken together shall constitute but one and the same
instrument. This Agreement shall become binding when one or more counterparts
taken together shall have been executed and delivered by the parties. It shall
not be necessary in making proof of this Agreement or any counterpart hereof to
produce or account for any of the other counterparts.
8.17 Definition of "Knowledge". For purposes of this Agreement,
the term "knowledge" of the Company, the Sellers, or any one of them, shall
mean and include the actual knowledge of Richard R. Hauser, Damon C. Davis and
Stephen Klingenberger.
8.18 Disclaimer. Except to the extent expressly provided in or
pursuant to this Agreement,, the Company and the Sellers make no
representations or warranties to Purchaser.
<PAGE> 43
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IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement on the date first written above.
PURCHASER:
---------
BELL ATLANTIC VENTURES XXIX, INC.
By : /Daniel J. Gomez/
-----------------------------
Name: Daniel J. Gomez
Title: Chairman and CEO
THE COMPANY:
-----------
HOWARD W. SAMS & COMPANY
By : /Richard R. Hauser/
-----------------------------
Name: Richard R. Hauser
Title: President
THE SELLERS:
------------
/Damon C. Davis/
----------------------------------
Damon C. Davis
/Richard R. Hauser/
----------------------------------
Richard R. Hauser
Bell Atlantic Directory Graphics, Inc. hereby guarantees the full and
prompt payment of all amounts payable by Purchaser to the Sellers, and the full
discharge of all other obligations of Purchaser to the Sellers, pursuant to the
foregoing Agreement and Plan of Merger.
BELL ATLANTIC DIRECTORY GRAPHICS,
INC.
By : /Daniel J. Gomez/
-----------------------------
Name: Daniel J. Gomez
Title: President
<PAGE> 1
[BELL ATLANTIC LETTERHEAD]
September 5, 1995
Bell Atlantic Corporation
1717 Arch Street
Philadelphia, Pennsylvania 19103
Ladies and Gentlemen:
Reference is made to a registration statement on Form S-4 (the
"Registration Statement") which Bell Atlantic Corporation (the "Company") is
filing with the Securities and Exchange Commission pursuant to the Securities
Act of 1933, as amended, relating to up to 150,000 shares of the Company's
Common Stock, par value $1.00 per share (the "Shares"). The Shares will be
exchanged for shares of Howard W. Sams & Company ("Sams") in accordance with an
Agreement and Plan of Merger (the ("Agreement") dated as of August 30, 1995,
among Sams, Richard R. Hauser, Damon C. Davis, and Bell Atlantic Ventures XXIX,
Inc.
I have reviewed the Company's certificate of incorporation and
by-laws, resolutions of its Board of Directors and such other documents and
corporate records as I have deemed appropriate for the purpose of giving this
opinion.
Based upon the foregoing, I am of the opinion that:
1. The Company is a corporation duly incorporated, validly
existing and in good standing under the laws of the State of
Delaware.
2. The Shares have been duly authorized and, upon sale in
accordance with the Agreement, will be legally issued, fully
paid and non-assessable.
I hereby consent to the filing of this opinion with the Securities and
Exchange Commission in connection with the Registration Statement and to being
named under the heading Legal Opinions in the Prospectus contained in the
Registration Statement.
Very truly yours,
/P. Alan Bulliner/
P. Alan Bulliner
<PAGE> 1
[COOPERS & LYBRAND LETTERHEAD]
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in this registration statement on
Form S-4 of our reports dated February 6, 1995, which include an explanatory
paragraph stating that the Company discontinued accounting for the operations
of its telephone subsidiaries in accordance with Statement of Financial
Accounting Standards No. 71, "Accounting for the Effect of Certain Types of
Regulation," effective August 1, 1994, and changed its method of accounting for
income taxes and postemployment benefits in 1993, on our audits of the
consolidated financial statements and financial statement schedule of the
Company and its subsidiaries as of December 31, 1994 and December 31, 1993, and
for each of the three years in the period ended December 31, 1994, which report
is incorporated by reference or included in the Company's Annual Report on Form
10-K for the year ended December 31, 1994.
We also consent to the reference to our Firm under the caption "Independent
Accountants".
/COOPERS & LYBRAND L.L.P./
2400 Eleven Penn Center
Philadelphia, Pennsylvania
September 1, 1995
<PAGE> 1
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS:
WHEREAS, BELL ATLANTIC CORPORATION, a Delaware corporation
(hereinafter referred to as the "Company"), proposes to file with the
Securities and Exchange Commission under the provisions of the Securities Act
of 1933, as amended, a registration statement on Form S-4 relating to shares of
the Company's common stock which will be issued in connection with the merger
of a subsidiary of the Company with and into Howard W. Sams & Company;
NOW, THEREFORE, the undersigned hereby appoints Raymond W. Smith and
William O. Albertini, and each of them, as attorney for the undersigned for the
purpose of executing and filing such registration statement or any amendment
thereto, hereby giving to said attorney full authority to perform all acts
necessary thereto as fully as the undersigned could do if personally present,
and hereby ratifying all that said attorney may lawfully do or cause to be done
by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this Power of
Attorney this 22 day of August, 1995.
/Barbara L. Connor/
-------------------
Barbara L. Connor
<PAGE> 2
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS:
WHEREAS, BELL ATLANTIC CORPORATION, a Delaware corporation
(hereinafter referred to as the "Company"), proposes to file with the
Securities and Exchange Commission under the provisions of the Securities Act
of 1933, as amended, a registration statement on Form S-4 relating to shares of
the Company's common stock which will be issued in connection with the merger
of a subsidiary of the Company with and into Howard W. Sams & Company;
NOW, THEREFORE, the undersigned hereby appoints Raymond W. Smith,
William O. Albertini, and Barbara L. Connor, and each of them, as attorney for
the undersigned for the purpose of executing and filing such registration
statement or any amendment thereto, hereby giving to said attorney full
authority to perform all acts necessary thereto as fully as the undersigned
could do if personally present, and hereby ratifying all that said attorney may
lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this Power of
Attorney this 21st day of August, 1995.
/William W. Adams/
------------------
William W. Adams
<PAGE> 3
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS:
WHEREAS, BELL ATLANTIC CORPORATION, a Delaware corporation
(hereinafter referred to as the "Company"), proposes to file with the
Securities and Exchange Commission under the provisions of the Securities Act
of 1933, as amended, a registration statement on Form S-4 relating to shares of
the Company's common stock which will be issued in connection with the merger
of a subsidiary of the Company with and into Howard W. Sams & Company;
NOW, THEREFORE, the undersigned hereby appoints Raymond W. Smith and
Barbara L. Connor, and each of them, as attorney for the undersigned for the
purpose of executing and filing such registration statement or any amendment
thereto, hereby giving to said attorney full authority to perform all acts
necessary thereto as fully as the undersigned could do if personally present,
and hereby ratifying all that said attorney may lawfully do or cause to be done
by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this Power of
Attorney this 22 day of August, 1995.
/William O. Albertini/
----------------------
William O. Albertini
<PAGE> 4
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS:
WHEREAS, BELL ATLANTIC CORPORATION, a Delaware corporation
(hereinafter referred to as the "Company"), proposes to file with the
Securities and Exchange Commission under the provisions of the Securities Act
of 1933, as amended, a registration statement on Form S-4 relating to shares of
the Company's common stock which will be issued in connection with the merger
of a subsidiary of the Company with and into Howard W. Sams & Company;
NOW, THEREFORE, the undersigned hereby appoints Raymond W. Smith,
William O. Albertini, and Barbara L. Connor, and each of them, as attorney for
the undersigned for the purpose of executing and filing such registration
statement or any amendment thereto, hereby giving to said attorney full
authority to perform all acts necessary thereto as fully as the undersigned
could do if personally present, and hereby ratifying all that said attorney may
lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this Power of
Attorney this 20 day of August, 1995.
/Lawrence T. Babbio, Jr./
-------------------------
Lawrence T. Babbio, Jr.
<PAGE> 5
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS:
WHEREAS, BELL ATLANTIC CORPORATION, a Delaware corporation
(hereinafter referred to as the "Company"), proposes to file with the
Securities and Exchange Commission under the provisions of the Securities Act
of 1933, as amended, a registration statement on Form S-4 relating to shares of
the Company's common stock which will be issued in connection with the merger
of a subsidiary of the Company with and into Howard W. Sams & Company;
NOW, THEREFORE, the undersigned hereby appoints Raymond W. Smith,
William O. Albertini, and Barbara L. Connor, and each of them, as attorney for
the undersigned for the purpose of executing and filing such registration
statement or any amendment thereto, hereby giving to said attorney full
authority to perform all acts necessary thereto as fully as the undersigned
could do if personally present, and hereby ratifying all that said attorney may
lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this Power of
Attorney this 22 day of August, 1995.
/Thomas E. Bolger/
------------------
Thomas E. Bolger
<PAGE> 6
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS:
WHEREAS, BELL ATLANTIC CORPORATION, a Delaware corporation
(hereinafter referred to as the "Company"), proposes to file with the
Securities and Exchange Commission under the provisions of the Securities Act
of 1933, as amended, a registration statement on Form S-4 relating to shares of
the Company's common stock which will be issued in connection with the merger
of a subsidiary of the Company with and into Howard W. Sams & Company;
NOW, THEREFORE, the undersigned hereby appoints Raymond W. Smith,
William O. Albertini, and Barbara L. Connor, and each of them, as attorney for
the undersigned for the purpose of executing and filing such registration
statement or any amendment thereto, hereby giving to said attorney full
authority to perform all acts necessary thereto as fully as the undersigned
could do if personally present, and hereby ratifying all that said attorney may
lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this Power of
Attorney this 18th day of August, 1995.
/Frank C. Carlucci/
-------------------
Frank C. Carlucci
<PAGE> 7
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS:
WHEREAS, BELL ATLANTIC CORPORATION, a Delaware corporation
(hereinafter referred to as the "Company"), proposes to file with the
Securities and Exchange Commission under the provisions of the Securities Act
of 1933, as amended, a registration statement on Form S-4 relating to shares of
the Company's common stock which will be issued in connection with the merger
of a subsidiary of the Company with and into Howard W. Sams & Company;
NOW, THEREFORE, the undersigned hereby appoints Raymond W. Smith,
William O. Albertini, and Barbara L. Connor, and each of them, as attorney for
the undersigned for the purpose of executing and filing such registration
statement or any amendment thereto, hereby giving to said attorney full
authority to perform all acts necessary thereto as fully as the undersigned
could do if personally present, and hereby ratifying all that said attorney may
lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this Power of
Attorney this 21st day of August, 1995.
/William G. Copeland/
---------------------
William G. Copeland
<PAGE> 8
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS:
WHEREAS, BELL ATLANTIC CORPORATION, a Delaware corporation
(hereinafter referred to as the "Company"), proposes to file with the
Securities and Exchange Commission under the provisions of the Securities Act
of 1933, as amended, a registration statement on Form S-4 relating to shares of
the Company's common stock which will be issued in connection with the merger
of a subsidiary of the Company with and into Howard W. Sams & Company;
NOW, THEREFORE, the undersigned hereby appoints Raymond W. Smith,
William O. Albertini, and Barbara L. Connor, and each of them, as attorney for
the undersigned for the purpose of executing and filing such registration
statement or any amendment thereto, hereby giving to said attorney full
authority to perform all acts necessary thereto as fully as the undersigned
could do if personally present, and hereby ratifying all that said attorney may
lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this Power of
Attorney this 22 day of August, 1995.
/James G. Cullen/
-----------------
James G. Cullen
<PAGE> 9
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS:
WHEREAS, BELL ATLANTIC CORPORATION, a Delaware corporation
(hereinafter referred to as the "Company"), proposes to file with the
Securities and Exchange Commission under the provisions of the Securities Act
of 1933, as amended, a registration statement on Form S-4 relating to shares of
the Company's common stock which will be issued in connection with the merger
of a subsidiary of the Company with and into Howard W. Sams & Company;
NOW, THEREFORE, the undersigned hereby appoints Raymond W. Smith,
William O. Albertini, and Barbara L. Connor, and each of them, as attorney for
the undersigned for the purpose of executing and filing such registration
statement or any amendment thereto, hereby giving to said attorney full
authority to perform all acts necessary thereto as fully as the undersigned
could do if personally present, and hereby ratifying all that said attorney may
lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this Power of
Attorney this 18th day of August, 1995.
/James H. Gilliam, Jr./
-----------------------
James H. Gilliam, Jr.
<PAGE> 10
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS:
WHEREAS, BELL ATLANTIC CORPORATION, a Delaware corporation
(hereinafter referred to as the "Company"), proposes to file with the
Securities and Exchange Commission under the provisions of the Securities Act
of 1933, as amended, a registration statement on Form S-4 relating to shares of
the Company's common stock which will be issued in connection with the merger
of a subsidiary of the Company with and into Howard W. Sams & Company;
NOW, THEREFORE, the undersigned hereby appoints Raymond W. Smith,
William O. Albertini, and Barbara L. Connor, and each of them, as attorney for
the undersigned for the purpose of executing and filing such registration
statement or any amendment thereto, hereby giving to said attorney full
authority to perform all acts necessary thereto as fully as the undersigned
could do if personally present, and hereby ratifying all that said attorney may
lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this Power of
Attorney this 23 day of August, 1995.
/Thomas H. Kean/
----------------
Thomas H. Kean
<PAGE> 11
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS:
WHEREAS, BELL ATLANTIC CORPORATION, a Delaware corporation
(hereinafter referred to as the "Company"), proposes to file with the
Securities and Exchange Commission under the provisions of the Securities Act
of 1933, as amended, a registration statement on Form S-4 relating to shares of
the Company's common stock which will be issued in connection with the merger
of a subsidiary of the Company with and into Howard W. Sams & Company;
NOW, THEREFORE, the undersigned hereby appoints Raymond W. Smith,
William O. Albertini, and Barbara L. Connor, and each of them, as attorney for
the undersigned for the purpose of executing and filing such registration
statement or any amendment thereto, hereby giving to said attorney full
authority to perform all acts necessary thereto as fully as the undersigned
could do if personally present, and hereby ratifying all that said attorney may
lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this Power of
Attorney this 22 day of August, 1995.
/John C. Marous, Jr./
---------------------
John C. Marous, Jr.
<PAGE> 12
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS:
WHEREAS, BELL ATLANTIC CORPORATION, a Delaware corporation
(hereinafter referred to as the "Company"), proposes to file with the
Securities and Exchange Commission under the provisions of the Securities Act
of 1933, as amended, a registration statement on Form S-4 relating to shares of
the Company's common stock which will be issued in connection with the merger
of a subsidiary of the Company with and into Howard W. Sams & Company;
NOW, THEREFORE, the undersigned hereby appoints Raymond W. Smith,
William O. Albertini, and Barbara L. Connor, and each of them, as attorney for
the undersigned for the purpose of executing and filing such registration
statement or any amendment thereto, hereby giving to said attorney full
authority to perform all acts necessary thereto as fully as the undersigned
could do if personally present, and hereby ratifying all that said attorney may
lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this Power of
Attorney this 21 day of August, 1995.
/John F. Maypole/
-----------------
John F. Maypole
<PAGE> 13
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS:
WHEREAS, BELL ATLANTIC CORPORATION, a Delaware corporation
(hereinafter referred to as the "Company"), proposes to file with the
Securities and Exchange Commission under the provisions of the Securities Act
of 1933, as amended, a registration statement on Form S-4 relating to shares of
the Company's common stock which will be issued in connection with the merger
of a subsidiary of the Company with and into Howard W. Sams & Company;
NOW, THEREFORE, the undersigned hereby appoints Raymond W. Smith,
William O. Albertini, and Barbara L. Connor, and each of them, as attorney for
the undersigned for the purpose of executing and filing such registration
statement or any amendment thereto, hereby giving to said attorney full
authority to perform all acts necessary thereto as fully as the undersigned
could do if personally present, and hereby ratifying all that said attorney may
lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this Power of
Attorney this 21 day of August, 1995.
/Joseph Neubauer/
-----------------
Joseph Neubauer
<PAGE> 14
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS:
WHEREAS, BELL ATLANTIC CORPORATION, a Delaware corporation
(hereinafter referred to as the "Company"), proposes to file with the
Securities and Exchange Commission under the provisions of the Securities Act
of 1933, as amended, a registration statement on Form S-4 relating to shares of
the Company's common stock which will be issued in connection with the merger
of a subsidiary of the Company with and into Howard W. Sams & Company;
NOW, THEREFORE, the undersigned hereby appoints Raymond W. Smith,
William O. Albertini, and Barbara L. Connor, and each of them, as attorney for
the undersigned for the purpose of executing and filing such registration
statement or any amendment thereto, hereby giving to said attorney full
authority to perform all acts necessary thereto as fully as the undersigned
could do if personally present, and hereby ratifying all that said attorney may
lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this Power of
Attorney this 21 day of August, 1995.
/Thomas H. O'Brien/
-------------------
Thomas H. O'Brien
<PAGE> 15
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS:
WHEREAS, BELL ATLANTIC CORPORATION, a Delaware corporation
(hereinafter referred to as the "Company"), proposes to file with the
Securities and Exchange Commission under the provisions of the Securities Act
of 1933, as amended, a registration statement on Form S-4 relating to shares of
the Company's common stock which will be issued in connection with the merger
of a subsidiary of the Company with and into Howard W. Sams & Company;
NOW, THEREFORE, the undersigned hereby appoints Raymond W. Smith,
William O. Albertini, and Barbara L. Connor, and each of them, as attorney for
the undersigned for the purpose of executing and filing such registration
statement or any amendment thereto, hereby giving to said attorney full
authority to perform all acts necessary thereto as fully as the undersigned
could do if personally present, and hereby ratifying all that said attorney may
lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this Power of
Attorney this 22nd day of August, 1995.
/Rozanne L. Ridgway/
--------------------
Rozanne L. Ridgway
<PAGE> 16
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS:
WHEREAS, BELL ATLANTIC CORPORATION, a Delaware corporation
(hereinafter referred to as the "Company"), proposes to file with the
Securities and Exchange Commission under the provisions of the Securities Act
of 1933, as amended, a registration statement on Form S-4 relating to shares of
the Company's common stock which will be issued in connection with the merger
of a subsidiary of the Company with and into Howard W. Sams & Company;
NOW, THEREFORE, the undersigned hereby appoints William O. Albertini,
and Barbara L. Connor, and each of them, as attorney for the undersigned for
the purpose of executing and filing such registration statement or any
amendment thereto, hereby giving to said attorney full authority to perform all
acts necessary thereto as fully as the undersigned could do if personally
present, and hereby ratifying all that said attorney may lawfully do or cause
to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this Power of
Attorney this 22 day of August, 1995.
/Raymond W. Smith/
------------------
Raymond W. Smith
<PAGE> 17
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS:
WHEREAS, BELL ATLANTIC CORPORATION, a Delaware corporation
(hereinafter referred to as the "Company"), proposes to file with the
Securities and Exchange Commission under the provisions of the Securities Act
of 1933, as amended, a registration statement on Form S-4 relating to shares of
the Company's common stock which will be issued in connection with the merger
of a subsidiary of the Company with and into Howard W. Sams & Company;
NOW, THEREFORE, the undersigned hereby appoints Raymond W. Smith,
William O. Albertini, and Barbara L. Connor, and each of them, as attorney for
the undersigned for the purpose of executing and filing such registration
statement or any amendment thereto, hereby giving to said attorney full
authority to perform all acts necessary thereto as fully as the undersigned
could do if personally present, and hereby ratifying all that said attorney may
lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this Power of
Attorney this 22 day of August, 1995.
/Shirley Young/
---------------
Shirley Young
