AGREEMENT AND PLAN
OF MERGER
BETWEEN
METROVISION OF NORTH AMERICA, INC.
and
YORK HANNOVER PHARMACEUTICALS, INC.
Dated as of May 10, 1996
AGREEMENT
ARTICLE I
THE MERGER . . . . . . . . . . . . . . . . . . . . . . . . . . .2
SECTION 1.01 The Merger. . . . . . . . . . . . . . . . . . .2
SECTION 1.02. Effective Time . . . . . . . . . . . . . . .2
SECTION 1.03. Effect of the Merger . . . . . . . . . . . .2
SECTION 1.04. Certificate of Incorporation; By-Laws . . . . . .3
SECTION 1.05 Directors and Officers. . . . . . . . . . . . . .3
SECTION 1.06. Effect on Capital Stock . . . . . . . . . . . . .3
SECTION 1.07 Tax and Accounting Consequences . . . . . . . . .3
SECTION 1.08 Taking of Necessary Action: Further Action . . .4
SECTION 1.09 Material Adverse Effect . . . . . . . . . . . . .4
SECTION 1.10 Merger Consideration. . . . . . . . . . . . . . .4
ARTICLE II
YORK HANNOVER REPRESENTATIONS AND WARRANTIES . . . . . . . . . .4
SECTION 2.01 Organization. . . . . . . . . . . . . . . . . . .5
SECTION 2.02 Capital Stock of York Hannover. . . . . . . . . .5
SECTION 2.03 Articles of Incorporation and By-Laws;
Subsidiaries of York
Hannover. . . . . . . . . . . . . . . . . .6
SECTION 2.04. Validity and Conflicts; Required Filings and
Consents6
SECTION 2.05 Authority . . . . . . . . . . . . . . . . . . . .7
SECTION 2.06 SEC Documents . . . . . . . . . . . . . . . . . .7
SECTION 2.07 (a) York Hannover Company Financials . . . . . .7
SECTION 2.08 Absence of Adverse Change . . . . . . . . . . . .9
SECTION 2.09 Licenses. . . . . . . . . . . . . . . . . . . . .9
SECTION 2.10 Compliance with Law . . . . . . . . . . . . . . .9
SECTION 2.11 Title by York Hannover. . . . . . . . . . . . . 10
SECTION 2.12 (a) Taxes and Tax Returns by York Hannover . . 11
SECTION 2.13 Material Contracts. . . . . . . . . . . . . . . 12
SECTION 2.14 Insurance . . . . . . . . . . . . . . . . . . . 12
SECTION 2.15 Litigation. . . . . . . . . . . . . . . . . . . 13
SECTION 2.16 Employee Plans and Contacts . . . . . . . . . . 13
SECTION 2.17 Trade Names . . . . . . . . . . . . . . . . . . 13
SECTION 2.18 Disclosure. . . . . . . . . . . . . . . . . . . 14
SECTION 2.19 Registration Statement/Proxy. . . . . . . . . . 14
SECTION 2.20 No Undisclosed Liability. . . . . . . . . . . . 14
SECTION 2.21 Necessary Action. . . . . . . . . . . . . . . . 14
SECTION 2.22 Restrictions on Business Activities . . . . . . 14
SECTION 2.23 Investment Company Act. . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . 15
ARTICLE III
METROVISION REPRESENTATIONS AND WARRANTIES . . . . . . . . . . 15
SECTION 3.01 Organization of MetroVision . . . . . . . . . . 15
SECTION 3.02 Capital Stock of MetroVision. . . . . . . . . . 15
SECTION 3.03 Articles of Incorporation and By-Laws;
Subsidiaries of MetroVision16
SECTION 3.04. Validity and Conflicts; Required Filings and
Consents16
SECTION 3.05 Authority . . . . . . . . . . . . . . . . . . . 17
SECTION 3.06 SEC Documents . . . . . . . . . . . . . . . . . 17
SECTION 3.07 The MetroVision Financials. . . . . . . . . . . 18
SECTION 3.08 Absence of Adverse Change . . . . . . . . . . . 18
SECTION 3.09 Licenses. . . . . . . . . . . . . . . . . . . . 18
SECTION 3.10 Compliance with Law . . . . . . . . . . . . . . 19
SECTION 3.11 Title . . . . . . . . . . . . . . . . . . . . . 19
SECTION 3.12 Taxes and Tax Returns . . . . . . . . . . . . . 19
SECTION 3.13 Material Contracts. . . . . . . . . . . . . . . 20
SECTION 3.14 Insurance . . . . . . . . . . . . . . . . . . . 20
SECTION 3.15 Litigation. . . . . . . . . . . . . . . . . . . 21
SECTION 3.16 Employee Plans and Contacts . . . . . . . . . . 21
SECTION 3.17 Trade Names . . . . . . . . . . . . . . . . . . 21
SECTION 3.18 Disclosure. . . . . . . . . . . . . . . . . . . 21
SECTION 3.19 Registration Statement/Proxy. . . . . . . . . . 22
SECTION 3.20 No Undisclosed Liability. . . . . . . . . . . . 22
SECTION 3.21 Necessary Action. . . . . . . . . . . . . . . . 22
SECTION 3.22 Restrictions on Business Activities . . . . . . 22
SECTION 3.23 Investment Company Act. . . . . . . . . . . . . 22
ARTICLE IV
CONDUCT OF BUSINESS PENDING THE MERGER . . . . . . . . . . . . 23
SECTION 4.01. Conduct of Business by York Hannover Pending the
Merger23
SECTION 4.02. Conduct of Business by MetroVision Pending
the Merger26
SECTION 4.03 No Solicitation by MetroVision. . . . . . . . 29
SECTION 4.04 No Solicitation by York Hannover. . . . . . . . 30
ARTICLE VADDITIONAL AGREEMENTS . . 31
SECTION 5.01 Preparation of S-4 and the Proxy Statement. . . 31
SECTION 5.02 Stockholders' Meeting . . . . . . . . . . . . . 31
SECTION 5.03 Access to Information: Confidentiality. . . . 32
SECTION 5.04 Consents: Approval . . . . . . . . . . . . . . 32
SECTION 5.05 Agreement of Affiliates.. . . . . . . . . . . . 33
SECTION 5.06 Indemnification and Insurance . . . . . . .
. . 33SECTION 5.07. Notification of Certain Matters . . . . . .
. . 34
SECTION 5.08 Further Action/Tax Treatment. . . . . . . . . . 34
SECTION 5.09 Public Announcements. . . . . . . . . . . . . . 35
SECTION 5.10. Listing of Surviving Corporation Common Shares. 35
SECTION 5.11. Conveyance Taxes. . . . . . . . . . . . . . . . 35
ARTICLE VICONDITIONS TO THE MERGER 35
SECTION 6.01 Conditions to Obligation of Each Party to Effect
the Merger35
SECTION 6.02 Additional Conditions to Obligations of York
Hannover36
SECTION 6.03 Additional Conditions to Obligation of
MetroVision38
ARTICLE VII
TERMINATION. . . . . . . . . . . . . . . . . . . . . . . . . . 39
SECTION 7.01 Termination . . . . . . . . . . . . . . . . . . 39
SECTION 7.02 Effect of Termination . . . . . . . . . . . . . 40
SECTION 7.03 Fees and Expenses. . . . . . . . . . . . . . . 40
ARTICLE VIII
GENERAL PROVISIONS . . . . . . . . . . . . . . . . . . . . . . 42
SECTION 8.01 Effectiveness of Representations, Warranties and
Agreements42
SECTION 8.02. Notices . . . . . . . . . . . . . . . . . . . . 42
SECTION 8.03 Certain Definitions . . . . . . . . . . . . . . 44
SECTION 8.04 Amendment . . . . . . . . . . . . . . . . . . . 45
SECTION 8.05 Waiver. . . . . . . . . . . . . . . . . . . . . 45
SECTION 8.06 Headings. . . . . . . . . . . . . . . . . . . . 45
SECTION 8.07. Severability. . . . . . . . . . . . . . . . . . 45
SECTION 8.08 Entire Agreement. . . . . . . . . . . . . . . . 45
SECTION 8.09 Assignment. . . . . . . . . . . . . . . . . . . 46
SECTION 8.10. Parties in Interest . . . . . . . . . . . . . . 46
SECTION 8.11 Failure or Indulgence Not Waiver; Remedies
Cumulative46
SECTION 8.12. Governing Law. . . . . . . . . . . . . . . 46
SECTION 8.13. Counterparts . . . . . . . . . . . . . . . 46
SECTION 8.14. Waiver of Jury Trial . . . . . . . . . . . 52
AGREEMENT AND PLAN OF MERGER, dated as of May , 1996
(the "Agreement"), between York Hannover Pharmaceuticals, Inc.,
a Florida corporation ("York Hannover") and MetroVision of North
America, Inc., a New York corporation ("MetroVision");
W I T N E S S E T H:
WHEREAS, the Boards of Directors of MetroVision and York
Hannover have each determined that it is advisable and in the
best interests of their respective stockholders for MetroVision
to enter into a business combination with York Hannover upon the
terms and subject to the conditions set forth herein; and
WHEREAS, in furtherance of such combination, the Boards of
Directors of MetroVision and York Hannover have each approved
the merger (the "Merger") of York Hannover with and into the
MetroVision in accordance with the applicable provisions of the
New York Business Corporation Law ("New York Law") and the
Florida Business Corporations Act ("Florida Law"), and upon the
terms and subject to the conditions set forth herein;
WHEREAS, pursuant to the Merger, all shares of York
Hannover's 12% Preferred Stock (the "York Hannover 12% Preferred
Stock") which shall be issued prior to the Merger having a
redemption value of $1,950,000 plus accrued dividends will be
exchanged for like preferred stock of MetroVision and York
Hannover's Common Shares shall be exchanged for the Merger
consideration as defined in Section 1.10, upon the terms and
subject to the conditions set forth herein; and
WHEREAS, MetroVision and York Hannover intend, by approving
resolutions authorizing this Agreement, to adopt this Agreement
as a plan of reorganization within the meaning of Section
368(a)(1)(A) of the Internal Revenue Code of 1986, as amended
(the "Code"), and the regulations thereunder; and
WHEREAS, for accounting purposes, it is intended that the
transactions contemplated hereby shall be accounted for as a
purchase under United States generally accepted accounting
principles ("GAAP");
NOW, THEREFORE, in consideration of the foregoing and the
mutual covenants and agreements herein contained, and intending
to be legally bound hereby, MetroVision and York Hannover hereby
agree as follows:
ARTICLE I
THE MERGER
SECTION 1.01 The Merger.
(a) Effective Time. At the Effective Time (as
defined in Section 1.02 hereof), and subject to and upon the
terms and conditions of this Agreement, Florida Law and New York
Law, York Hannover shall be merged with and into MetroVision,
the separate corporate existence of York Hannover shall cease,
and MetroVision shall continue as the Surviving Corporation.
MetroVision as the Surviving Corporation after the Merger is
herein sometimes referred to as the "Surviving Corporation."
(b) Closing. Unless this Agreement shall have been
terminated and the transactions herein contemplated shall have
been abandoned pursuant to Section 7.01 and subject to the
satisfaction or waiver of the conditions set forth in Article
VI, the consummation of the Merger will take place as promptly
as practicable (and in any event within two business days)
after satisfaction or waiver of the conditions set forth in
Article VI, at the offices of Shereff, Friedman, Hoffman &
Goodman, LLP, 919 Third Avenue, New York, New York 10022,
unless another date, time or place is agreed to in writing by
the parties hereto.
SECTION 1.02. Effective Time. As promptly as
practicable after the satisfaction or waiver of the conditions
set forth in Article VI, the parties hereto shall cause the
Merger to be consummated by filing a certificate of Merger as
contemplated by Section 607.1106 of Florida Law and Section 904
of New York Law (the "Certificate of Merger") together with any
required related certificates with the Department of State of
the State of New York and the Secretary of State of the State of
Florida in such form as required by, and executed in accordance
with the related provisions of, New York Law and Florida Law,
respectively (the time of such filing being the "Effective
Time").
SECTION 1.03. Effect of the Merger. At the
Effective Time, the effect of the Merger shall be as provided in
this Agreement, the Certificate of Merger and the applicable
provisions of New York Law and Florida Law. Without limiting
the generality of the foregoing, and subject thereto, at the
Effective Time all assets of York Hannover including all rights
and interest related to York Hannover's 40% ownership interest
in the York Hannover Partnership (the "York Hannover
Partnership") shall vest in MetroVision, and all debts,
liabilities and duties of York Hannover shall become the debts,
liabilities and duties of MetroVision. SECTION 1.04.
Certificate of Incorporation; By-Laws.
(a) Certificate of Incorporation. Unless otherwise
determined by MetroVision prior to the Effective Time, at the
Effective Time the Certificate of Incorporation of MetroVision,
as in effect immediately prior to the Effective Time, shall be
the Certificate of Incorporation of the Surviving Corporation
subject to the modifications contemplated by this Agreement
until thereafter amended as provided by New York Law and such
Certificate of Incorporation; provided, however, that Article I
of the Certificate of Incorporation of the Surviving Corporation
shall be amended to read as follows: "The name of the
corporation is York Hannover Health Care, Inc.".
(b) By-Laws. The By-Laws of MetroVision, as in
effect immediately prior to the Effective Time, shall be the
By-Laws of the Surviving Corporation until thereafter amended as
provided by New York Law, the Certificate of Incorporation of
the Surviving Corporation and such By-Laws; provided, however,
that the By-laws shall be amended to provide that there shall be
no more than five (5) directors and each director's term shall
be for three years, with the terms of initial directors being
staggered as set forth in Section 1.05.
SECTION 1.05 Directors and Officers. MetroVision
shall obtain the Resignation of Joseph A. Calabrese, Don Stephan
Aron, and William H. Hessick, III as Directors of MetroVision
and Robert F. Hussey as President and David M. Fancher as Chief
Financial Officer of MetroVision as of the Effective Time.
Effective as of the Effective Time, directors of the Surviving
Corporation shall be Robert F. Hussey (1 year term), Lawrence B.
Cummings (3 year term), Thomas M. Clarke (1 year term), Peter W.
Doelger (3 year term) and Courtlandt G. Miller (2 year term);
each to hold office in accordance with the Certificate of
Incorporation and By-Laws of the Surviving Corporation, and the
officers of the Surviving Corporation shall be Robert F. Hussey,
Chairman of the Board, Lawrence B. Cummings, Chief Executive
Officer and Thomas M. Clarke, President, in each case until
their respective successors are duly elected or appointed and
qualified.
SECTION 1.06. Effect on Capital Stock. At the
Effective Time, by virtue of the Merger and without any action
on the part of MetroVision or York Hannover each share of York
Hannover Common Stock held in the treasury of York Hannover and
each MetroVision Common Share held in the treasury or owned by
MetroVision or any direct or indirect wholly owned subsidiary of
MetroVision immediately prior to the Effective Time shall, by
virtue of the Merger and without any action on the part of the
holder thereof, cease to be outstanding, be canceled and retired
without payment of any consideration therefor and cease to
exist. SECTION 1.07 Tax and Accounting
Consequences. It is intended by the parties hereto that the
Merger shall (i) constitute a reorganization of the type defined
in Section 368(a)(1)(A) of the Code and (ii) qualify for
accounting treatment as a purchase under GAAP. The parties
hereto hereby adopt this Agreement as a "plan of reorganization"
within the meaning of Section 1.368-2(g) and 1.368-3(a) of the
United States Treasury Regulations.
SECTION 1.08 Taking of Necessary Action: Further
Action. MetroVision and York Hannover will take all such
reasonable and lawful action as may be necessary or appropriate
in order to effectuate the Merger in accordance with this
Agreement as promptly as possible. If, at any time after the
Effective Time, any such further action is necessary or
desirable to carry out the purposes of this Agreement and to
vest the Surviving Corporation with full right, title and
possession to all assets, property, rights, privileges, powers
and franchises of York Hannover and MetroVision, the officers
and directors of York Hannover and MetroVision are fully
authorized in the name of their respective corporation or
otherwise to take, and will take, all such lawful and necessary
action.
SECTION 1.09 Material Adverse Effect. When used in
connection with York Hannover or any of its respective
subsidiaries, or MetroVision or any of its respective
subsidiaries, as the case may be, the term "Material Adverse
Effect" means any change or effect that, individually or when
taken together with all other such changes or effects that have
occurred prior to the date of determination of the occurrence of
the Material Adverse Effect, is or is reasonably likely to be
materially adverse to the business, assets (including intangible
assets), financial conditions or results of operations of York
Hannover and its respective subsidiaries or MetroVision and its
respective subsidiaries, as the case may be, in each case taken
as a whole.
SECTION 1.10 Merger Consideration. In
consideration of the Merger, Stockbridge Investment Partners,
Inc. ("Stockbridge"), the sole shareholder of York Hannover,
shall receive, at Closing, 4,000,000 MetroVision Common Shares
(as defined below). As used herein, MetroVision Common Shares
shall mean validly issued, and fully paid and nonassessable, par
value $0.001 per share, registered shares of the Surviving
Corporation (after giving effect to the 4.6 for 1 reverse stock
split of MetroVision Common Shares as required by Section 6.01
(b) and (f)).
ARTICLE II
YORK HANNOVER REPRESENTATIONS AND WARRANTIES
York Hannover on behalf of itself and as a general partner
of the York Hannover Partnership (as defined below) hereby
warrants and represents to MetroVision that, except as otherwise
specifically set forth in the York Hannover Disclosure Schedule
attached hereto as Exhibit A (the "York Hannover Disclosure
Schedule"); provided that, no warranty or representation by York
Hannover as a general partner of the York Hannover Partnership
regarding York Hannover shall be deemed to be a warranty or
representation of the York Hannover Partnership:
SECTION 2.01 Organization.
(a) York Hannover. York Hannover is a corporation duly
organized, validly existing and in good standing under the laws
of the State of Florida and has the requisite corporate power
and authority and is in possession of all approvals necessary to
own, lease and operate the properties it purports to own,
operate or lease and to carry on its business as it is now being
conducted, except where the failure to be so organized, existing
and in good standing or to have such power, authority and
approval would not have a Material Adverse Effect. York
Hannover is duly qualified or licensed as a foreign corporation
to do business, and is in good standing, in each jurisdiction
where the character of its properties owned, leased or operated
by it or the nature of its activities makes such qualification
or licensing necessary, except for such failures to be so duly
qualified or licensed and in good standing that would not have a
Material Adverse Effect.
(b) York Hannover Partnership. The York Hannover
Partnership is a general partnership formed under the laws of
Wisconsin, the general partners of which are York Hannover (40%
interest) and United Professional Companies, Inc., a Delaware
corporation (60% interest). York Hannover Partnership is a
Partnership duly organized, validly existing and in good
standing under the laws of the State of Wisconsin and has the
requisite power and authority and is in possession of all
approvals necessary to own, lease and operate the properties it
purports to own, operate or lease and to carry on its business
as it is now being conducted, except where the failure to be so
organized, existing and in good standing or to have such power,
authority and approval would not have a Material Adverse Effect.
York Hannover Partnership is duly qualified or licensed to do
business, and is in good standing, in each jurisdiction where
the character of its properties owned, leased or operated by it
or the nature of its activities makes such qualification or
licensing necessary, except for such failures to be so duly
qualified or licensed and in good standing that would not have a
Material Adverse Effect.
SECTION 2.02 Capital Stock of York Hannover.
Section 2.02 of the York Hannover Disclosure Schedule sets
forth, by class, the entire authorized amount of capital stock
and other securities of York Hannover, along with the amount of
securities of each such class which is issued and outstanding.
All such issued and outstanding shares are duly authorized,
validly issued, fully paid and nonassessable. Except as
otherwise disclosed in Section 2.02 of the York Hannover
Disclosure Schedule, there are no outstanding or authorized
options, warrants, purchase rights, subscription rights,
conversion rights, exchange rights or other contracts or
commitments that require York Hannover to issue, sell or
otherwise cause to become outstanding any of its capital stock
or other securities. There are no outstanding or authorized
stock appreciation, phantom stock, profit participation or
similar rights with respect to York Hannover. Except as
otherwise specifically set forth in Section 2.02 of the York
Hannover Disclosure Schedule, there are no stockholders'
agreements, voting trusts, proxies or other agreements or
understandings with respect to the voting of the capital stock
of York Hannover.
SECTION 2.03 Articles of Incorporation and By-Laws;
Subsidiaries of York Hannover.
(a) Section 2.03 of York Hannover Disclosure Schedule
sets forth a complete and correct copy of its Articles of
Incorporation and the By-Laws, as amended to date. Such
Articles of Incorporation and By-Laws are in full force and
effect. York Hannover is not in violation of any of the
provisions of its Articles of Incorporation or By-Laws.
(b) Section 2.03 of the York Hannover Disclosure
Schedule sets forth the Partnership Agreement between York
Hannover and United Professional Companies, Inc. forming the
York Hannover Partnership which partnership agreement is in full
force and effect. York Hannover does not control directly or
indirectly or have any direct or indirect equity participation
in any corporation, partnership, joint venture, trust or other
business association other than the York Hannover Partnership.
SECTION 2.04. Validity and Conflicts; Required
Filings and Consents.
(a) This Agreement is valid, binding and enforceable
against York Hannover in accordance with its terms, except as
the enforceability thereof may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws
relating to the enforcement of creditors' rights generally and
by general principals of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at
law).
(b) Except as set forth in Section 2.04(b) of the York
Hannover Disclosure Schedule, the execution and delivery of this
Agreement by York Hannover do not, and the performance of this
Agreement by York Hannover shall not, (i) conflict with or
violate any law, rule, regulation, order, judgment or decree
applicable to York Hannover or any of it subsidiaries or the
York Hannover Partnership or by which its or their respective
properties are bound or affected, or (ii) conflict with or
violate the Partnership Agreement (iii) conflict with or violate
the Articles of Incorporation or By-Laws of York Hannover, (iv)
result in any breach of or constitute a default (or an event
which with notice or lapse of time or both would become a
default) under, or impair York Hannover's rights or alter the
rights or obligations of any party under, or give to others any
rights of termination, amendment, acceleration or cancellation
of, any material contract or result in the creation of a lien or
encumbrance on any of the properties or assets of York Hannover
or any of its subsidiaries or the York Hannover Partnership
pursuant to, any material note, bond, mortgage, indenture,
contract, agreement, lease, license, permit, franchise or other
instrument or obligation to which York Hannover or any of its
subsidiaries or the York Hannover Partnership is a party or by
which York Hannover or the York Hannover Partnership or any of
its subsidiaries or its or any of their respective properties
are bound or affected, except in any such case for any such
breaches, defaults or other occurrences that would not have a
Material Adverse Effect.
(c) The execution and delivery of this Agreement by
York Hannover will not require any consent, approval,
authorization or permit of, or filing with or notification to,
any governmental or regulatory authority, domestic or foreign,
except (i) for applicable requirements, if any, of the
Securities Act of 1933 as amended (the "Securities Act"), the
Exchange Act and the blue sky laws, and (ii) where the failure
to obtain such consents, approvals, authorizations or permits,
or to make such filing or notifications, would not prevent or
delay consummation of the Merger, or otherwise prevent York
Hannover from performing their respective obligations under this
Agreement, and would not have a Material Adverse Effect.
SECTION 2.05 Authority. Obtaining the approval of
its shareholders, as described more fully in Section 6.01(a),
York Hannover has full corporate power and authority to execute
and to deliver this Agreement and all related documents, and to
carry out the transactions contemplated herein and therein.
York Hannover has full corporate power and authority to conduct
its business as the same is now being conducted.
SECTION 2.06 SEC Documents. York Hannover is not a
reporting company as such term is defined in the Securities
Exchange Act of 1934, as amended (the "Exchange Act").
SECTION 2.07 (a) York Hannover Company Financials.
True and correct copies are set forth as Section 2.07(a) of the
York Hannover Disclosure Schedule of (i) the audited
consolidated balance sheet of York Hannover for the fiscal years
ended as of December 31, 1995 (the "1995 Company Balance
Sheet"), and December 31, 1994, and the related unaudited
consolidated statements of income, retained earnings,
stockholders' equity and cash flows of York Hannover, together
with all related notes and schedules thereto, and York Hannover
shall, on or before May 27, 1996, deliver the audited
consolidated balance sheet of York Hannover for the fiscal years
ended as of December 31, 1995 and December 31,1994 and the
related audited consolidated statements of income, retained
earnings, stockholders' equity and cash flows of York Hannover
together with all related notes and schedules thereto, (which
together with the unaudited financial statements are
collectively referred to herein as the "York Hannover Company
have been delivered by York Hannover Interim Financials")) and
(ii) the unaudited consolidated balance sheet of York Hannover
as of March 31, 1996, and the related consolidated statements of
income, retained earnings, stockholders' equity and cash flows
of York Hannover, together with all related notes and schedules
thereto (collectively referred to herein as the "York Hannover
Company Interim Financials"). The York Hannover Company
Financials and the York Hannover Company Interim Financials (i)
were prepared in accordance with the books of account and other
financial records of York Hannover, (ii) present fairly the
consolidated financial condition and results of operations of
York Hannover and its subsidiaries as of the dates thereof or
for the periods covered thereby, (iii) have been prepared in
accordance with GAAP applied on a basis consistent with the past
practices of York Hannover and (iv) include all adjustments
(consisting only of normal recurring accruals) that are
necessary for a fair presentation of the consolidated financial
condition of York Hannover and its subsidiaries and the results
of the operations of York Hannover and its subsidiaries as of
the dates thereof or for the periods covered thereby, except
that the unaudited interim Financial Statement was and is
subject to normal and recurring year-end adjustments which were
or are not expected to be of a material amount. Any financial
statements prepared by York Hannover subsequent to the date
hereof, (but only to the extent the same are required to be
prepared prior to the Effective Time) (the "Subsequent York
Hannover Company Financials") will be prepared in the same
manner as the Financial Statement and the Interim Financial
Statement will fairly represent the financial condition, and
will accurately set forth in all material respects the results
of the operations of York Hannover for the periods covered
thereby.
(b) The York Hannover Partnership Financials. True
and correct copies are set forth as Section 2.07(b) of the York
Hannover Disclosure Schedule of (i) the unaudited balance sheet
of the York Hannover Partnership for the fiscal year ended as of
December 31, 1995 (the "1995 Partnership Balance Sheet"), and
the related unaudited statements of income, retained earnings,
stockholders' equity and cash flows of York Hannover
Partnership, together with all related notes and schedules
thereto, (collectively referred to herein as the "York Hannover
Partnership Financials" and (ii) the unaudited balance sheet of
York Hannover Partnership as of March 31, 1996, and the related
statements of income, retained earnings, stockholders' equity
and cash flows of York Hannover Partnership, together with all
related notes and schedules thereto (collectively referred to
herein as the "York Hannover Partnership Interim Financials")
The York Hannover Partnership Financials and the York Hannover
Partnership Interim Financials (i) were prepared in accordance
with the books of account and other financial records of York
Hannover Partnership, (ii) present fairly the financial
condition and results of operations of York Hannover Partnership
as of the dates thereof or for the periods covered thereby,
(iii) have been prepared in accordance with GAAP applied on a
basis consistent with the past practices of York Hannover
Partnership and (iv) include all adjustments (consisting only of
normal recurring accruals) that are necessary for a fair
presentation of the financial condition of York Hannover
Partnership and the results of the operations of York Hannover
Partnership as of the dates thereof or for the periods covered
thereby, except that the unaudited interim Financial Statement
was and is subject to normal and recurring year-end adjustments
which were or are not expected to be of a material amount. Any
financial statements prepared by York Hannover Partnership
subsequent to the date hereof, (but only to the extent the same
are required to be prepared prior to the Effective Time) (the
"Subsequent York Hannover Partnership Financials") will be
prepared in the same manner as the Financial Statement and the
Interim Financial Statement will fairly represent the financial
condition, and will accurately set forth in all material
respects the results of the operations of York Hannover
Partnership for the periods covered thereby.
(c) York Hannover Financials. As used herein, York
Hannover Financials shall mean both the York Hannover Company
Financials and the York Hannover Partnership Financials; York
Hannover Interim Financials shall mean both York Hannover
Company Interim Financials and York Hannover Partnership Interim
Financials; and Subsequent York Hannover Financials shall mean
both Subsequent York Hannover Company Financials and Subsequent
York Hannover Partnership Financials.
SECTION 2.08 Absence of Adverse Change. Except as
set forth on Section 2.08 of York Hannover Disclosure Schedule,
since December 31, 1995, York Hannover and the York Hannover
Partnership have conducted their business in the ordinary course
and there has not occurred: (i) any Material Adverse Effect;
(ii) any amendments or changes in the Articles of Incorporation
or By-Laws of York Hannover or the York Hannover Partnership
Agreement; (iii) any damage to, destruction or loss of any
assets of York Hannover or the York Hannover Partnership,
(whether or not covered by insurance ) that could have a
Material Adverse Effect; (iv) any change in its accounting
methods, principles or practices; (v) any revaluation by York
Hannover or the York Hannover Partnership of any of their
assets, including without limitation, writing down the value of
capitalized software or inventory or writing off notes or
accounts receivable other than in the ordinary course of
business; (vi) except as disclosed in York Hannover Disclosure
Schedule, any other action or event that would have required the
consent of MetroVision pursuant to Section 4.02 had such action
or event occurred after the date of this Agreement, or (vii) any
sale of a material amount of assets of York Hannover or the York
Hannover Partnership, except in the ordinary course of business.
SECTION 2.09 Licenses. York Hannover and the York
Hannover Partnership have all material licenses, permits and
authorizations necessary for the operation of their businesses
(collectively, the "York Hannover Licenses"). Section 2.09 of
the York Hannover Disclosure Schedule sets forth the York
Hannover Licenses, true and correct copies of which have been
provided to MetroVision prior to the date hereof. There is no
action pending, or to the best knowledge of York Hannover,
threatened by the appropriate state or federal agency having
jurisdiction thereof, to either revoke, withdraw or suspend any
of the York Hannover Licenses or any decision not to renew any
of the York Hannover Licenses.
SECTION 2.10 Compliance with Law. York Hannover and
the York Hannover Partnership are in compliance with all
applicable municipal, county, state and federal laws and
regulations applicable to their business except where the
failure to so comply therewith would not have a Material Adverse
Effect.
SECTION 2.11 Title by York Hannover
(a) York Hannover has fee, leasehold or other title to
all of its assets (the "York Hannover Assets"), including, but
not limited to, the furniture, fixtures, equipment and other
tangible and intangible personal property owned or leased by
York Hannover and used in connection with the operation of the
business of York Hannover (collectively, the "York Hannover
Personal Property"), and there are no liens, claims, charges or
encumbrances on such assets other than the York Hannover
Permitted Liens(as defined herein). For purposes hereof, the
term York Hannover Permitted Liens shall mean: (i) mortgages,
deeds of trust, liens or security interests securing
indebtedness or lease obligations incurred by York Hannover and
reflected on the York Hannover Financials or the York Hannover
Interim Financials, (ii) mortgages, deeds of trust, liens or
security interest securing York Hannover's obligations in
connection with the York Hannover 12% Preferred Stock,
provided, however, such mortgages, deeds of trust, liens and
security interests shall allow the York Hannover 12% Preferred
Stock to be classified as equity by GAAP, the Exchange Act and
the Securities and Exchange Commission, (iii) liens for taxes,
assessments or governmental charges not yet delinquent, (iv)
such easements, rights of way, exceptions, reservations,
restrictions, conditions, limitations, covenants, adverse rights
or interests, mechanics' or materialmen' liens and any other
defects, imperfections in title, if any, as do not in the
aggregate materially interfere with the present use thereof or
otherwise materially impair the business operations of York
Hannover and (v) purchase money security interest arising from
the financing of the acquisition of certain of the York Hannover
Assets.
(b) Title by the York Hannover Partnership. York
Hannover Partnership has fee, leasehold or other title to all of
its assets (the "York Hannover Partnership Assets"), including,
but not limited to, the furniture, fixtures, equipment and other
tangible and intangible personal property owned or leased by the
York Hannover Partnership and used in connection with the
operation of the business of the York Hannover Partnership
(collectively, the "York Hannover Partnership Personal
Property"), and there are no liens, claims, charges or
encumbrances on such assets other than the York Hannover
Partnership Permitted Liens (as defined herein). For purposes
hereof, the term York Hannover Partnership Permitted Liens shall
mean: (i) mortgages, deeds of trust, liens or security interests
securing indebtedness or lease obligations incurred by York
Hannover Partnership and reflected on the York Hannover
Partnership Financials or York Hannover Partnership Interim
Financials, (ii) liens for taxes, assessments or governmental
charges not yet delinquent, (iii) such easements, rights of way,
exceptions, reservations, restrictions, conditions, limitations,
covenants, adverse rights or interests, mechanics' or
materialmen' liens and any other defects, imperfections in
title, if any, as do not in the aggregate materially interfere
with the present use thereof or otherwise materially impair the
business operations of the York Hannover Partnership and (iv)
purchase money security interest arising from the financing of
the acquisition of certain of the York Hannover Partnership
Assets.
SECTION 2.12 (a) Taxes and Tax Returns by York
Hannover. All tax and other returns, reports and filings of any
kind or nature required to be filed by York Hannover prior to
date of execution of this Agreement have been and, all tax and
other returns, reports and filings of any kind or nature
required to be filed prior to the consummation of the Merger
will be, properly completed and timely filed, or extensions for
the filing thereof have been (or will be) timely secured, and
all such filings are (or will be) in material compliance with
all applicable requirements and all taxes due with respect to
York Hannover have been (or will be) timely paid, except to the
extent that the same are being duly contested in good faith in
accordance with applicable law and adequate reserves therefor
are reflected on the York Hannover Financials or will be
reflected in the Subsequent York Hannover Financials in
accordance with the representations and warranties contained in
the Agreement. Copies of the December 31, 1994 federal and
state tax returns filed by York Hannover have been provided to
MetroVision. The accruals for taxes reflected in the York
Hannover Financials are or, in the case of the Subsequent York
Hannover Financials, will in the aggregate be adequate to cover
any and all federal, state or local tax liabilities (whether or
not in dispute) of York Hannover or any other entity required to
be consolidated with York Hannover under GAAP for the period
ended on the date thereof and all prior periods. With respect
to the tax liabilities of York Hannover, (i) there are no
disputes pending with any taxing authority with respect to taxes
of any nature which are or may be owing by York Hannover which
are not reflected in the York Hannover Financials, (ii) no tax
deficiency has been proposed in writing or, to the best
knowledge of York Hannover, threatened against York Hannover and
no action, proceeding or audit of any tax returns or reports
filed by York Hannover is pending or, to the best knowledge of
York Hannover, threatened by any governmental authority, (iii)
York Hannover has not executed any waiver to extend, or
otherwise taken or failed to take any action that would have the
effect of extending, the applicable statute of limitations with
respect to its tax liabilities, (iv) York Hannover is not a
"consenting corporation" within the meaning of Section 341(f) of
the Code, (v) York Hannover has at all times been taxable as a
Subchapter C corporation under the Code and has filed all tax
returns consistent with this characterization, (vi) other than
as a part of a consolidated group with Stockbridge Investment
Partners, Inc. York Hannover has not been a member of any
consolidated, combined or unitary group for federal, state or
local taxes purposes, and (vii) York Hannover has, or will have,
all records and information necessary for the timely and
accurate filing of any tax returns due after the date hereof,
including any returns due after the Effective Date which relate
to the period prior to the Effective Date. Stockbridge, the
sole stockholder of York Hannover, is a domestic corporation
within the meaning of Code Section 7701 (a)(30).
(b) Taxes and Tax Returns by York Hannover
Partnership. All tax and other returns, reports and filings of
any kind or nature required to be filed by York Hannover
Partnership prior to the date of execution of this Agreement
have been and, all tax and other returns, reports and filings of
any kind or nature required to be filed prior to the
consummation of the Merger will be, properly completed and
timely filed, or extensions for the filing thereof have been (or
will be) timely secured, and all such filings are (or will be)
in material compliance with all applicable requirements and all
taxes due with respect to York Hannover Partnership have been
(or will be) timely paid, except to the extent that the same are
being duly contested in good faith in accordance with applicable
law and adequate reserves therefor are reflected on the York
Hannover Partnership Financials or will be reflected in the
Subsequent York Hannover Partnership Financials in accordance
with the representations and warranties contained in this
Agreement. York Hannover Partnership has at all times been
taxable as a Partnership under the Code and has filed all tax
returns consistent with this characterization, York Hannover
Partnership has not been a member of any consolidated combined
or voluntary group for federal, state or local tax purposes and
York Hannover Partnership has, or will have, all records and
information necessary for the timely and accurate filing of any
tax returns due after the date hereof, including any returns due
after the Effective Date which relate to the period prior to the
Effective Date.
SECTION 2.13 Material Contracts. Set forth on
Section 2.13 of the York Hannover Disclosure Schedule is a true
and complete list of all contracts, agreements, plans, leases,
policies and licenses of York Hannover and the York Hannover
Partnership of the type that would be required to be filed as
exhibits by York Hannover under item 601 of Regulation S-K of
the Securities Act (the "York Hannover Material Contracts"),
true and correct copies of which have been provided to
MetroVision prior to the date hereof. A list of all employment
contracts, severance agreements, partnership and joint venture
agreements, contractual indemnity obligations and any other
agreement which imposes a present or future restriction of York
Hannover or the York Hannover Partnership's right to do business
and all York Hannover Material Contracts which York Hannover or
the York Hannover Partnership will be required to file as
exhibits to any York Hannover SEC Documents filed in connection
with the Merger is included in Section 2.13 of the York Hannover
Disclosure Schedule, true and correct copies of which have been
provided to MetroVision prior to the date hereof. To the extent
the same have continuing effect as of the date hereof, neither
York Hannover nor the York Hannover Partnership have breached
any material provision of, nor is York Hannover or the York
Hannover Partnership delinquent in any payment required under,
or in default in any material respect under the terms thereof,
nor has any condition or event occurred which, with the giving
of notice or the passage of time or both, would constitute an
event of default or a breach thereunder, except to the extent
the same has been waived in writing.
SECTION 2.14 Insurance. The properties and employees
of York Hannover and the York Hannover Partnership are insured
by the insurers or through the funds and with the types and
amounts of insurance (including, but not limited to, property,
professional liability, automobile, workers compensation,
business interruption and excess indemnity insurance) set forth
in Section 2.14 of the York Hannover Disclosure Schedule (the
"York Hannover Insurance Coverage"). York Hannover and the York
Hannover Partnership are not delinquent with respect to the
payment of any premiums due with respect to the York Hannover
Insurance Coverage, and has never been denied coverage which may
be required by the laws of the states in which York Hannover and
the York Hannover Partnership conducts business. The premiums
due on the insurance which covers calender year 1995 have been
paid in full and the premiums due for the period from the date
of execution of this Agreement to the Effective Date will be
paid in full as and when due.
SECTION 2.15 Litigation. There is not, nor has York
Hannover received written or verbal notice of any litigation,
investigation or other proceeding pending or, to the best of
York Hannover's knowledge, threatened against or relating to
York Hannover, the York Hannover Partnership or their properties
or business where the amount claimed exceeds $25,000 in any
single action or $50,000 in the aggregate. There is no, nor has
York Hannover or the York Hannover Partnership received written
or verbal notice of any litigation, investigation or other
proceeding pending, or to the best of York Hannover's knowledge
threatened by the Securities and Exchange Commission ("SEC"),
NASD, NASDAQ, the Food and Drug Administration or any other
governmental agency relating to York Hannover or the York
Hannover Partnerhsip. York Hannover and the York Hannover
Partnership are not a party to or bound by any orders,
judgments, injunctions, decrees or settlement agreements under
which it or they may have continuing obligations as of the date
hereof or as of the Effective Date and which may materially
restrict or affect the present business operations of York
Hannover or the York Hannover Partnership. The right or ability
of York Hannover to consummate the transaction contemplated
herein has not been challenged by any governmental agency or any
other person and York Hannover and the York Hannover Partnership
have no knowledge of the occurrence of any event which would
provide a reasonable basis for any such litigation,
investigation or other proceeding.
SECTION 2.16 Employee Plans and Contacts. Set forth
on Schedule 2.16 of the York Hannover Disclosure Schedule is a
true and complete list of all bonus, pension, stock option,
stock purchase, benefit, welfare, profit sharing, retirement,
disability, vacation, severance, hospitalization, insurance,
incentive, deferred compensation and other similar fringe or
employee benefit plans, funds, programs or arrangements, and all
employment contracts, contracts for services with employees of
York Hannover or the York Hannover Partnership ("York Hannover
Employees") and executive compensation agreements, written or
oral, in each of the foregoing cases which cover, are maintained
for the benefit of , or relate to any or all York Hannover
Employees or former York Hannover Employees (the "York Hannover
Employees Plans").
SECTION 2.17 Trade Names. Set forth in Section 2.17
of the York Hannover Disclosure Schedule is a true and complete
list of trade names under which York Hannover and the York
Hannover Partnership are doing, or within the last 12 months has
done, business and a statement as to whether, when and where
such trade names have been registered or filed. York Hannover
and York Hannover Partnership have not received any notice from
any person challenging or questioning the right of York Hannover
or the York Hannover Partnership to use any such trade names.
SECTION 2.18 Disclosure. No representation or
warranty by or on behalf of York Hannover or the York Hannover
Partnership contained in this Agreement and no statement
contained in any certificate, list, exhibit, or other instrument
furnished or to be furnished to MetroVision pursuant hereto
contains or will contain any untrue statement of material fact,
or omits or will omit to state any material facts which are
necessary in order to make the statements contained herein or
therein, in light of the circumstances under which they were
made, not misleading.
SECTION 2.19 Registration Statement/Proxy. The
Registration Statement on Form S-4 at the time it is declared
effective, the Proxy Statement/Prospectus at the time of its
mailing to the MetroVision shareholders and at the time of the
meeting of the shareholders of MetroVision will not contain any
untrue statement of a material fact or omit to state a material
fact concerning York Hannover or the York Hannover Partnership
or omit to state a material fact required or necessary to be
stated therein in order to make the statements contained therein
concerning York Hannover or the York Hannover Partnership, in
light of the circumstances under which they are made, not
misleading; except that, York Hannover makes no representation
or warranty with respect to any statement, information or
omission relating to MetroVision contained in the Registration
Statement, the Proxy Statement/Prospectus or in any other
registration statement.
SECTION 2.20 No Undisclosed Liability. York
Hannover and the York Hannover Partnership do not have any
liabilities or obligations except (i) those liabilities which
are set forth in the York Hannover Financials and (ii) those
liabilities which are set forth in Section 2.20 of the York
Hannover Disclosure Schedule.
SECTION 2.21 Necessary Action. York Hannover has
duly and properly taken or obtained or caused to be taken or
obtained, or prior to Closing will have duly and properly taken
or obtained or caused to be taken or obtained, all action
necessary for York Hannover (i) to enter into and to deliver
this Agreement and any and all documents and agreements executed
by York Hannover in connection herewith or in furtherance hereof
and (ii) to carry out the terms hereof and thereof and the
transaction contemplated herein and therein. Except as
contemplated by Sections 5.01 and 5.05, no other action by or on
behalf of York Hannover is or will be necessary to authorize the
execution, delivery and performance of this Agreement and any
documents and agreements executed by York Hannover in connection
herewith or the transaction contemplated herein. York Hannover
represents and warrants that as of the date of execution of this
Agreement, it has secured the consent of its Board of Directors
and shareholders to the execution this Agreement and of any
documents or agreements necessary to carry out the terms hereof
and for the consummation of the transaction contemplated by this
Agreement, including but limited to the Merger.
SECTION 2.22. Restrictions on Business Activities.
Except for this Agreement, there is no material agreement,
judgment, injunction, order or decree binding upon York Hannover
or any of its subsidiaries which has or could reasonably be
expected to have the effect of prohibiting or materially
impairing any business practice of York Hannover or any of its
subsidiaries, any acquisition of property by York Hannover or
any of its subsidiaries or the conduct of business by York
Hannover or any of its subsidiaries as currently conducted or as
proposed to be conducted by York Hannover.
SECTION 2.23. Investment Company Act.
Neither York Hannover or York Hannover Partnership is an
Investment Company within the meaning of the Investment Company
Act of 1940, as amended.
ARTICLE III
METROVISION REPRESENTATIONS AND WARRANTIES
MetroVision hereby warrants and represents to York Hannover
that, except as otherwise specifically set forth in the
MetroVision Disclosure Schedule attached hereto as Exhibit B
(the "MetroVision Disclosure Schedule"):
SECTION 3.01 Organization of MetroVision.
(a) MetroVision is a corporation duly organized,
validly existing and in good standing under the laws of the
State of New York and has the requisite corporate power and
authority and is in possession of all approvals necessary to
own, lease and operate the properties it purports to own,
operate or lease and to carry on its business as it is now being
conducted, except where the failure to be so organized, existing
and in good standing or to have such power, authority and
approval would not have a Material Adverse Effect. MetroVision
is duly qualified or licensed as a foreign corporation to do
business, and is in good standing, in each jurisdiction where
the character of its properties owned, leased or operated by it
or the nature of its activities makes such qualification or
licensing necessary, except for such failures to be so duly
qualified or licensed and in good standing that would not have a
Material Adverse Effect.
SECTION 3.02 Capital Stock of MetroVision. Section
3.02 of the MetroVision Disclosure Schedule sets forth, by
class, the entire authorized amount of capital stock and other
securities of MetroVision, along with the amount of securities
of each such class which is issued and outstanding. All such
issued and outstanding shares are duly authorized, validly
issued, fully paid and nonassessable. Except as otherwise
disclosed in Section 3.02 of the MetroVision Disclosure
Schedule, there are no outstanding or authorized options,
warrants, purchase rights, subscription rights, conversion
rights, exchange rights or other contracts or commitments that
require MetroVision to issue, sell or otherwise cause to become
outstanding any of its capital stock or other securities. There
are no outstanding or authorized stock appreciation, phantom
stock, profit participation or similar rights with respect to
MetroVision. Except as otherwise specifically set forth in
Section 3.02 of the MetroVision Disclosure Schedule, there are
no stockholders' agreements, voting trusts, proxies or other
agreements or understandings with respect to the voting of the
capital stock of MetroVision.
SECTION 3.03 Articles of Incorporation and By-Laws;
Subsidiaries of MetroVision. (a) Section 3.03 of
MetroVision Disclosure Schedule sets forth a complete and
correct copy of its Articles of Incorporation and the By-Laws,
as amended to date. Such Articles of Incorporation and By-Laws
are in full force and effect. MetroVision is not in violation
of any of the provisions of its Articles of Incorporation or
By-Laws.
(b) Section 3.03 of the MetroVision Disclosure
Schedule sets forth Touchtel, Inc. ("Touchtel"), the sole
subsidiary of MetroVision, its jurisdiction of incorporation,
and the states in which it is qualified to do business as a
foreign corporation. All issued and outstanding shares of
Touchtel are duly authorized, validly issued, fully paid and
nonassessable and MetroVision is the sole owner of all such
issued and outstanding shares. There are no outstanding or
authorized options, warrants, purchase rights, subscription
rights, conversion rights, exchange rights or other contracts or
commitments that require Touchtel to issue, sell or otherwise
cause to become outstanding any of its capital stock or other
securities. There are no outstanding or authorized stock
appreciation, phantom stock, profit participation or similar
rights with respect to Touchtel. There are no stockholders'
agreements, voting trusts, proxies or other agreements or
understandings with respect to the voting of the capital stock
of Touchtel. MetroVision does not control directly or
indirectly or have any direct or indirect equity participation
in any corporation, partnership, joint venture, trust or other
business association other than Touchtel.
SECTION 3.04. Validity and Conflicts; Required
Filings and Consents.
(a) This Agreement is valid, binding and enforceable
against MetroVision in accordance with its terms, except as the
enforceability thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to
the enforcement of creditors' rights generally and by general
principals of equity (regardless of whether such enforceability
is considered in a proceeding in equity or at law).
(b) Except as set forth in Section 3.04(b) of the
MetroVision Disclosure Schedule, the execution and delivery of
this Agreement by MetroVision do not, and the performance of
this Agreement by MetroVision shall not, (i) conflict with or
violate the Articles of Incorporation or By-Laws of MetroVision
or Touchtel, (ii) conflict with or violate any law, rule,
regulation, order, judgment or decree applicable to MetroVision
or any of it subsidiaries or by which its or their respective
properties are bound or affected, or (iii) result in any breach
of or constitute a default (or an event which with notice or
lapse of time or both would become a default) under, or impair
MetroVision's rights or alter the rights or obligations of any
party under, or give to others any rights of termination,
amendment, acceleration or cancellation of, any material
contract or result in the creation of a lien or encumbrance on
any of the properties or assets of MetroVision or any of its
subsidiaries pursuant to, any material note, bond, mortgage,
indenture, contract, agreement, lease, license, permit,
franchise or other instrument or obligation to which MetroVision
or any of its subsidiaries is a party or by which MetroVision or
any of its subsidiaries or its or any of their respective
properties are bound or affected, except in any such case for
any such breaches, defaults or other occurrences that would not
have a Material Adverse Effect.
(c) The execution and delivery of this Agreement by
MetroVision will not require any consent, approval,
authorization or permit of, or filing with or notification to,
any governmental or regulatory authority, domestic or foreign,
except (i) for applicable requirements, if any, of the
Securities Act, the Exchange Act and the blue sky laws, and (ii)
where the failure to obtain such consents, approvals,
authorizations or permits, or to make such filing or
notifications, would not prevent or delay consummation of the
Merger, or otherwise prevent MetroVision from performing its
obligations under this Agreement, and would not have a Material
Adverse Effect.
SECTION 3.05 Authority Subject to obtaining the
approval of its shareholders, as described more fully in Section
6.01(b), MetroVision has full corporate power and authority to
execute and to deliver this Agreement and all related documents,
and to carry out the transactions contemplated herein and
therein. Each of MetroVision and Touchtel has full corporate
power and authority to conduct its business as the same is now
being conducted.
SECTION 3.06 SEC Documents. MetroVision is a
reporting company as such term is defined in the Exchange Act
and has delivered to York Hannover a true and complete copy of
each report, schedule, registration statement and definitive
proxy statement filed by it with Securities and Exchange
Commission (the "Commission") (and any such documents have since
the time of their filing been amended the "MetroVision SEC
Documents") since January 1, 1993, which are all the documents
(other than preliminary material) that it was required to file
with the Commission since such date. As of their respective
dates, the MetroVision SEC Documents complied in all material
respects with the requirements of the Securities Act or the
Exchange Act, as the case may be, and the rules and regulations
of the Commission thereunder applicable to such MetroVision SEC
Documents, and none of the MetroVision SEC Documents contained
any untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances under
which they were made, not misleading. All material agreements,
contracts and other documents required to be filed as exhibits
to any of the MetroVision SEC Documents have been so filed.
SECTION 3.07 The MetroVision Financials. True and
correct copies of the financial statements for three years
ending December 31, 1995 relating to the operations of
MetroVision, including its filing with the Commission pursuant
to the Exchange Act, have been previously delivered to York
Hannover. Except as otherwise noted therein, all such financial
statements included within the MetroVision SEC Documents have
been prepared in accordance with GAAP (in the case of audited
statements) and in accordance with applicable accounting
requirements of the Commission (in the case of unaudited
statements), consistently applied, fairly represent the
financial condition, and accurately set forth in all material
respect the results of the combined operations, of MetroVision
and Touchtel for the periods covered thereby (the "MetroVision
Financials"). Any financial statements prepared by MetroVision
subsequent to the date hereof, (but only to the extent the same
are required to be prepared prior to the Effective Time) (the
"Subsequent MetroVision Financials"); will be prepared in
accordance with GAAP (in the case of audited statements) and in
accordance with the applicable accounting requirements of the
Commission (in the case of unaudited statements), consistently
applied, will fairly represent the financial condition, and will
accurately set forth in all material respects the results of the
combined operations, of MetroVision and Touchtel for the periods
covered thereby.
SECTION 3.08 Absence of Adverse Change. Except as
set forth on Section 3.08 of MetroVision Disclosure Schedule,
since December 31, 1995, MetroVision and Touchtel have conducted
their business in the ordinary course and there has not
occurred: (i) any Material Adverse Effect; (ii) any amendments
or changes in the Articles of Incorporation or By-Laws of
MetroVision; (iii) any damage to, destruction or loss of any
assets of MetroVision, (whether or not covered by insurance )
that could have a Material Adverse Effect; (iv) any change in
its accounting methods, principles or practices; (v) any
revaluation by MetroVision or Touchtel of any of their assets,
including without limitation, writing down the value of
capitalized software or inventory or writing off notes or
accounts receivable other than in the ordinary course of
business; (vi) except as disclosed in MetroVision Disclosure
Schedule, any other action or event that would have required the
consent of York Hannover pursuant to Section 4.02 had such
action or event occurred after the date of this Agreement, or
(vii) any sale of a material amount of assets of MetroVision or
Touchtel, except in the ordinary course of business.
SECTION 3.09 Licenses. MetroVision and Touchtel
have all material licenses, permits and authorizations necessary
for the operation of their businesses (collectively, the
"MetroVision Licenses"). Section 3.09 of the MetroVision
Disclosure Schedule sets forth the MetroVision Licenses, true
and correct copies of which have been provided to York Hannover
prior to the date hereof. There is no action pending, or to the
best knowledge of MetroVision, threatened by the appropriate
state or federal agency having jurisdiction thereof, to either
revoke, withdraw or suspend any of the MetroVision Licenses or
any decision not to renew any of the MetroVision Licenses.
SECTION 3.10 Compliance with Law. Except as set
forth in Section 3.10 of the MetroVision Disclosure Schedule,
MetroVision is in compliance with all applicable municipal,
county, state and federal laws and regulations applicable to its
business except where the failure to so comply therewith would
not have a Material Adverse Effect.
SECTION 3.11 Title. MetroVision and Touchtel have
fee, leasehold or other title to all of their assets (the
"MetroVision Assets"), including, but not limited to, the
furniture, fixtures, equipment and other tangible and intangible
personal property owned or leased by MetroVision and Touchtel
and used in connection with the operation of the business of
MetroVision (collectively, the "MetroVision Personal Property"),
and there are no liens, claims, charges or encumbrances on such
assets other than the MetroVision Permitted Liens(as defined
herein). For purposes hereof, the term MetroVision Permitted
Liens shall mean: (i) mortgages, deeds of trust, liens or
security interests securing indebtedness or lease obligations
incurred by MetroVision and reflected on the MetroVision
Financials or the MetroVision SEC Documents, (ii) liens for
taxes, assessments or governmental charges not yet delinquent,
(iii) such easements, rights of way, exceptions, reservations,
restrictions, conditions, limitations, covenants, adverse rights
or interests, mechanics' or materialmen' liens and any other
defects, imperfections in title, if any, as do not in the
aggregate materially interfere with the present use thereof or
otherwise materially impair the business operations of
MetroVision and (iv) purchase money security interest arising
from the financing of the acquisition of certain of the
MetroVision Assets. SECTION 3.12 Taxes and Tax
Returns. All tax and other returns, reports and filings of any
kind or nature required to be filed by MetroVision prior to the
date of execution of this Agreement have been and, all tax and
other returns and filings of any kind or nature required to be
filed prior to the consummation of the Merger, will be, properly
completed and timely filed, or extensions for the filing thereof
have been (or will be) timely secured, and all such filings are
(or will be) in material compliance with all applicable
requirements and all taxes due with respect to MetroVision have
been (or will be) timely paid, except to the extent that the
same are being duly contested in good faith in accordance with
applicable law and adequate reserves therefor are reflected on
the MetroVision Financials or will be reflected in the
Subsequent MetroVision Financials and the MetroVision Financials
in accordance with the representations and warranties contained
in the Agreement. Copies of the December 31, 1994 federal and
state tax returns filed by MetroVision or any of the MetroVision
Subsidiaries will be provided to York Hannover on request. The
accruals for taxes reflected in the MetroVision Financials are
or, in the case of the Subsequent MetroVision Financials, will ,
in the aggregate, be adequate to cover any and all federal,
state or local tax liabilities (whether or not in dispute) of
MetroVision or any other entity required to be consolidated with
MetroVision under GAAP for the period ended on the date thereof
and all prior periods. With respect to the tax liabilities of
MetroVision, (i) there are no disputes pending with any taxing
authority with respect to taxes of any nature which are or may
be owing by MetroVision which are not reflected in the
MetroVision Financials, (ii) no tax deficiency has been proposed
in writing or, to the best knowledge of MetroVision, threatened
against MetroVision and no action, proceeding or audit of any
tax returns or reports filed by MetroVision is pending or, to
the best knowledge of MetroVision, threatened by any
governmental authority, (iii) MetroVision has not executed any
waiver to extend, or otherwise taken or failed to take any
action that would have the effect of extending, the applicable
statute of limitations with respect to its tax liabilities, (iv)
MetroVision is not a "consenting corporation" within the meaning
of Section 341(f) of the Code, (v) MetroVision has at all times
after December 17, 1991 been taxable as a Subchapter C
corporation under the Code and has filed all tax returns
consistent with this characterization, (vi) MetroVision has not
been a member of any consolidated combined or unitary group
(other than with Touchtel) for federal state, or local tax
purposes and (vii) MetroVision has, or will have, all records
and information necessary for the timely and accurate filing of
any tax returns due after the date hereof, including any returns
due after the Effective Date which relate to the period prior to
the Effective Date.
SECTION 3.13 Material Contracts. Set forth on
Section 3.13 of the MetroVision Disclosure Schedule is a true
and complete list of all contracts, agreements, plans, leases,
policies and licenses of MetroVision of the type required to be
filed as exhibits by MetroVision under item 601 of Regulation
S-K of the Securities Act (the "MetroVision Material
Contracts"), true and correct copies of which have been provided
to York Hannover prior to the date hereof. A list of all
employment contracts, severance agreements, partnership and
joint venture agreements, contractual indemnity obligations and
any other agreement which imposes a present or future
restriction of MetroVision's right to do business and all
MetroVision Material Contracts which MetroVision will be
required to file as exhibits to any MetroVision SEC Documents
filed after the date hereof is included in Section 3.13 of the
MetroVision Disclosure Schedule, true and correct copies of
which have been provided to York Hannover prior to the date
hereof. To the extent the same have continuing effect as of the
date hereof, MetroVision has not breached any material provision
of, nor is MetroVision delinquent in any payment required under,
or in default in any material respect under the terms thereof,
nor has any condition or event occurred which, with the giving
of notice or the passage of time or both, would constitute an
event of default or a breach thereunder, except to the extent
the same has been waived in writing.
SECTION 3.14 Insurance. The properties and
employees of MetroVision are insured by the insurers or through
the funds and with the types and amounts of insurance
(including, but not limited to, property, professional
liability, automobile, workers compensation, business
interruption and excess indemnity insurance) set forth in
Section 3.14 of the MetroVision Disclosure Schedule (the
"MetroVision Insurance Coverage"). MetroVision is not
delinquent with respect to the payment of any premiums due with
respect to the MetroVision Insurance Coverage, and has never
been denied coverage which may be required by the laws of the
states in which MetroVision conducts business. The premiums due
on the insurance which covers calender year 1995 have been paid
in full and the premiums due for the period from the date of
execution of this Agreement to the Effective Date will be paid
in full as and when due.
SECTION 3.15 Litigation. Except as set forth on
Schedule 3.15 of the MetroVision Disclosure Schedule, there is
not, nor has MetroVision received written or verbal notice of
any litigation, investigation or other proceeding pending or, to
the best of MetroVision's knowledge, threatened against or
relating to MetroVision or their properties or business where
the amount claimed exceeds $25,000 in any single action or
$50,000 in the aggregate. There is no, nor has MetroVision
received written or verbal notice of any litigation,
investigation or other proceeding pending, or to the best of
MetroVision's knowledge threatened by the SEC, NASD or, NASDAQ,
the Food and Drug Administration or any other governmental
agency relating to MetroVision. MetroVision is not a party to
or bound by any orders, judgments, injunctions, decrees or
settlement agreements under which it or they may have continuing
obligations as of the date hereof or as of the Effective Date
and which may materially restrict or affect the present business
operations of MetroVision. The right or ability of MetroVision
to consummate the transaction contemplated herein has not been
challenged by any governmental agency or any other person and
MetroVision has no knowledge of the occurrence of any event
which would provide a reasonable basis for any such litigation,
investigation or other proceeding.
SECTION 3.16 Employee Plans and Contacts. Set forth
on Schedule 3.16 of the MetroVision Disclosure Schedule is a
true and complete list of all bonus, pension, stock option,
stock purchase, benefit, welfare, profit sharing, retirement,
disability, vacation, severance, hospitalization, insurance,
incentive, deferred compensation and other similar fringe or
employee benefit plans, funds, programs or arrangements, and all
employment contracts, contracts for services with employees of
MetroVision ("MetroVision Employees") and executive compensation
agreements, written or oral, in each of the foregoing cases
which cover, are maintained for the benefit of , or relate to
any or all MetroVision Employees or former MetroVision Employees
(the "MetroVision Employees Plans").
SECTION 3.17 Trade Names. Set forth in Section 3.17
of the MetroVision Disclosure Schedule is a true and complete
list of trade names under which MetroVision and Touchtel are
doing, or within the last 12 months have done, business and a
statement as to whether, when and where such trade names have
been registered or filed. Neither MetroVision not Touchtel have
received any notice from any person challenging or questioning
the right of MetroVision or Touchtel to use any such trade names.
SECTION 3.18 Disclosure. No representation or
warranty by or on behalf of MetroVision contained in this
Agreement and no statement contained in any certificate, list,
exhibit, or other instrument furnished or to be furnished to
York Hannover pursuant hereto contains or will contain any
untrue statement of material fact, or omits or will omit to
state any material facts which are necessary in order to make
the statements contained herein or therein, in light of the
circumstances under which they were made, not misleading.
SECTION 3.19 Registration Statement/Proxy. The
Registration Statement on Form S-4 at the time it is declared
effective, the Proxy Statement/Prospectus at the time of its
mailing to the MetroVision shareholders and at the time of the
meeting of the shareholders of MetroVision, will not contain any
untrue statement of a material fact or omit to state a material
fact concerning MetroVision or omit to state a material fact
required or necessary to be stated therein in order to make the
statements contained therein concerning MetroVision, in light of
the circumstances under which they are made, not misleading;
except that, MetroVision makes no representation or warranty
with respect to any statement, information or omission relating
to York Hannover contained in the Registration Statement, the
Proxy Statement/Prospectus or in any other registration
statement.
SECTION 3.20 No Undisclosed Liability. MetroVision
does not have any liabilities or obligations except (i) those
liabilities which are set forth in the MetroVision Financials
and, (ii) those liabilities which are set forth in Section 3.20
of the MetroVision Disclosure Schedule.
SECTION 3.21 Necessary Action. MetroVision has duly
and properly taken or obtained or caused to be taken or
obtained, or prior to Closing will have duly and properly taken
or obtained or caused to be taken or obtained, all action
necessary for MetroVision (i) to enter into and to deliver this
Agreement and any and all documents and agreements executed by
MetroVision in connection herewith or in furtherance hereof and
(ii) to carry out the terms hereof and thereof and the
transaction contemplated herein and therein, including, but not
limited to, obtaining the consent of the Board of Directors.
Except as provided in Sections 5.01 and 5.02, no other action by
or on behalf of MetroVision is or will be necessary to authorize
the execution, delivery and performance of this Agreement and
any documents and agreements executed by MetroVision in
connection herewith or the transaction contemplated herein.
SECTION 3.22 Restrictions on Business Activities.
Except for this Agreement, there is no material agreement,
judgment, injunction, order or decree binding upon MetroVision
or any of its subsidiaries which has or could reasonably be
expected to have the effect of prohibiting or materially
impairing any business practice of MetroVision or any of its
subsidiaries, any acquisition of property by MetroVision or any
of its subsidiaries or the conduct of business by MetroVision or
any of its subsidiaries as currently conducted or as proposed to
be conducted by MetroVision. SECTION 3.23
Investment Company Act. Neither MetroVision or Touchtel are an
Investment Company within the meaning of the Investment Company
Act of 1940, as amended.
ARTICLE IV
CONDUCT OF BUSINESS PENDING THE MERGER
SECTION 4.01. Conduct of Business by York Hannover
Pending the Merger. During the period from the date of this
Agreement and continuing until the earlier of the termination of
this Agreement or the Effective Time, York Hannover covenants
and agrees that, unless MetroVision shall otherwise agree in
writing, York Hannover shall conduct its business, and shall use
its best efforts to cause the businesses of the York Hannover
Partnership to be conducted, in the ordinary course of business
and consistent with past practice, other than actions taken by
York Hannover or the York Hannover Partnership in connection
herewith or otherwise change York Hannover's Articles of
Incorporation, or amend the terms of the York Hannover
Partnership Agreement or issue any class or new stock other than
the 12% Preferred Stock of which the proceeds will be used to
payoff York Hannover's existing term loan in the amount of
$1,950,000 plus all accrued interest issued to National
HealthCare L.P.; and York Hannover shall use reasonable
commercial effects to preserve substantially intact the business
organization of York Hannover and the York Hannover Partnership,
to keep available the services of the present officers,
employees and consultants of Hannover and the York Hannover
Partnership, to take all action necessary to prevent the loss,
cancellation, abandonment, forfeiture or expiration of any York
Hannover Intellectual Property and York Hannover Partnership
Intellectual Property, and to preserve the present relationships
of York Hannover and the York Hannover Partnership with
customers, suppliers and other persons with which Hannover or
the York Hannover Partnership has significant business
relations. By way of amplification and not limitation, except
as contemplated by this Agreement, York Hannover or the York
Hannover Partnership shall not, during the period from the date
of this Agreement and continuing until the earlier of the
termination of this Agreement or the Effective Time, directly or
indirectly do, or propose to do, any of the following without
the prior written consent of MetroVision:
(a) amend or otherwise change York Hannover's
Articles of Incorporation or By-Laws, or amend the
terms of the York Hannover Partnership Agreement;
(b) issue, sell, pledge, dispose of or
encumber, or authorize the issuance, sale, pledge,
disposition or encumbrance of, any shares of capital stock of
any class, or any option, warrants, convertible
securities or other rights of any kind to acquire any
shares of capital stock, or any other ownership interest
(including, without limitation, any phantom interest)
of York Hannover or the York Hannover Partnership,
other than the York Hannover 12% Preferred Stock, the terms of
which shall be mutually agreeable to the parties
hereto, of which the proceeds will be used to payoff
York Hannover's existing term loan in the amount of $1,950,000
plus all accrued interest issued to National HealthCare
L.P. (the "NHC Loan");
(c) sell, pledge, dispose of or encumber any
assets of York Hannover or the York Hannover
Partnership (except for (i) sales of assets in the ordinary
course of business and in a manner consistent with past
practice and (ii) dispositions of obsolete or worthless
assets);
(d) declare, set aside, make or pay any dividend
or other distribution (whether in cash, stock, property
or any combination thereof) of the York Hannover
Partnership, except that the York Hannover Partnership may
declare and pay all current and accrued Priority
Distributions (as defined therein) and the prepayment of
all amounts contributed as additional capital to the York
Hannover Partnership, furthermore York Hannover is
permitted to redeem or cancel all other classes of
preferred stock outstanding, except the York Hannover 12%
Preferred Stock, and to distribute all assets other
than its 40% interest in the York Hannover Partnership prior
to the Effective Time;
(e) (i) acquire (by merger, consolidation, or
acquisition of stock or assets) any corporation,
partnership or other business organization or division thereof;
(ii) incur any indebtedness for borrowed money or issue
any debt securities or assume, guarantee (other than
guarantees of bank debt of York Hannover Partnership entered
into in the ordinary course of business) or endorse or
otherwise as an accommodation become responsible for,
the obligations of any person, or make any loans or advances,
except in the ordinary course of business; (iv) authorize
any capital expenditures or purchase of fixed assets
which are, in the aggregate, in excess of $25,000 for York
Hannover or the York Hannover Partnership; or (v) enter into
or amend any contract, agreement, commitment or
arrangement to effect any of the matters prohibited by this
Section 4.01(e);
(f) increase the compensation payable or to
become payable to its officers or employees, except for
increases in salaries or wages of employees of York
Hannover or the York Hannover Partnership who are not officers
of York Hannover in accordance with past practices, or
grant any severance or termination pay to, or enter
into any employment or severance agreement with any director,
officer (except for officers who are terminated on an
involuntary basis) or other employee of York Hannover
or the York Hannover Partnership, or establish, adopt, enter
into or amend any employee plan other than as
contemplated in this Agreement;
(g) take any action to change accounting
policies or procedures (including, without limitation,
procedure with respect to revenue recognition, payments of
accounts payable and collection of accounts receivable);
(h) make any material tax election inconsistent
with past practices or settle or compromise any
material federal, state, local or foreign tax liability or agree
to an extension of a statute of limitation except to
the extent the amount of any such settlement has been
reserved for on the York Hannover Financials;
(i) pay, discharge or satisfy any claims,
liabilities or obligations (absolute, accrued, asserted
or unassented, contingent or otherwise), other than the payment,
discharge or satisfaction in the ordinary course of
business and consistent with past practice of
liabilities reflected or reserved against in the financial
statements of York Hannover or the York Hannover
Partnership or incurred in the ordinary course of
business and consistent with past practice;
(j) enter into or commit to enter into any
contract, agreement, arrangement or understanding
having a term longer than six months unless such
contract, agreement, arrangement or understanding either (i) may
be canceled by it without penalty on not more than
thirty days' notice or (ii) does not require the
expenditure of more than $25,000 for any single contract,
agreement or arrangement and $50,000 for all such
contracts, arrangements and agreements;
(k) modify, amend or terminate any
contract, waive, release, relinquish or assign any
contract or other rights or claims or cancel or forgive any
indebtedness owed to it, other than in the ordinary
course of business consistent with past practice with
respect to contracts which are not material to York Hannover or
the York Hannover Partnership taken as a whole; or
(l) take, or agree in writing or otherwise to
take, any of the actions described in Section 4.01(a)
through (k) above, or any action which would make any
of the representations or warranties of York Hannover contained
in this Agreement untrue or incorrect or prevent York
Hannover from performing or cause York Hannover not to
perform its covenants hereunder or result in any of the
conditions to the Merger set forth herein not being
satisfied.
SECTION 4.02. Conduct of Business by MetroVision
Pending the Merger. During the period from the date of this
Agreement and continuing until the earlier of the termination of
this Agreement or the Effective Time, MetroVision covenants and
agrees that, unless York Hannover shall otherwise agree in
writing, MetroVision shall conduct its business and shall cause
the businesses of its subsidiaries to be conducted only in, and
MetroVision and its subsidiaries shall not take any action
except in, the ordinary course of business and in a manner
consistent with past practice, other than actions taken by
MetroVision or Touchtel in connection herewith; and MetroVision
shall use reasonable commercial effects to preserve
substantially intact the business organization of MetroVision
and its subsidiaries, to keep available the services of the
present officers, employees and consultants of MetroVision and
its subsidiaries, to take all action necessary to prevent the
loss, cancellation, abandonment, forfeiture or expiration of any
MetroVision Intellectual Property and to preserve the present
relationships of MetroVision or any of its subsidiaries with
customers, suppliers and other persons with which MetroVision or
any of its subsidiaries has significant business relations. In
addition to the foregoing, MetroVision shall take such
additional actions as are necessary and appropriate to improve
its cash flow such that as of the Effective Time MetroVision
will reasonably project positive case flow by December 31, 1996.
By way of amplification and not limitation, except as
contemplated by this Agreement, neither MetroVision nor any of
it subsidiaries shall, during the period from the date of this
Agreement and continuing until the earlier of the termination of
this Agreement or the Effective Time, directly or indirectly do,
or propose to do, any of the following without the prior written
consent of York Hannover;:
(a) amend or otherwise change MetroVision's
Certificate of Incorporation or By-Laws:
(b) issue, sell, pledge, dispose of or encumber,
or authorize the issuance, sale, pledge, disposition or
encumbrance of, any shares of capital stock of any class,
or any option, warrants, convertible securities or other
rights of any kind to acquire any shares of capital
stock, or any other ownership interest (including, without
limitation, any phantom interest) of MetroVision, any of its
subsidiaries or affiliates (except for the issuance of
shares of MetroVision Common Shares issuable pursuant
to MetroVision's 1991 Stock Option Plan (the "1991 Plan") and
MetroVision's 1993 Non-employee Directors' Stock Option
Plan (the "Director Plan") (together, the "MetroVision
Stock Option Plans"), which options are outstanding on the date
hereof);
(c) sell, pledge, dispose of or encumber any
assets of MetroVision or any of its subsidiaries
(except for (i) sales of assets in the ordinary course of
business and in a manner consistent with past practice
and (ii) dispositions of obsolete or worthless assets);
(d) (i) declare, set aside, make or pay any
dividend or other distribution (whether cash, stock or
property or any combination thereof) in respect of any of its
capital stock, except that a wholly owned subsidiary of
MetroVision may declare and pay a dividend to
MetroVision, (ii) split, combine or reclassify any of its
capital stock or issue or authorize or propose the
issuance of any other securities in respect of, in lieu
of or in substitution for shares of its capital stock, other
than the 4.6 for 1 reverse stock split of the
MetroVision Common Shares and the conversion of the 5% Series
A Preferred Stock, each as contemplated in this Agreement,
or (iii) amend the terms of, repurchase, redeem or
otherwise acquire, or permit any subsidiaries to repurchase,
redeem or otherwise acquire, any of its securities or any
securities of its subsidiaries, or propose to do any of
the foregoing;
(e) amend or change the period (or permit any
acceleration, amendment or change) of exercisability of
options or restricted stock granted under the Employee
Plans (including the MetroVision Stock Option Plans) or
authorize cash payments in exchange for any options
granted under any of such plans;
(f) (i) acquire (by merger, consolidation, or
acquisition of stock or assets) any corporation,
partnership or other business organization or division thereof;
(ii) incur any indebtedness for borrowed money or issue
any debt securities or assume, guarantee (other than
guarantees of bank debt of MetroVision's subsidiaries entered
into in the ordinary course of business) or endorse or
otherwise as an accommodation become responsible for,
the obligations of any person, or make any loans or advances,
except in the ordinary course of business; (iv) authorize
any capital expenditures or purchase of fixed assets
which are, in the aggregate, in excess of $25,000 for
MetroVision and its subsidiaries taken as a whole; or (v) enter
into or amend any contract, agreement, commitment or
arrangement to effect any of the matters prohibited by
this Section 4.02(f);
(g) increase the compensation payable or to
become payable to its officers or employees, except for
increases in salaries or wages of employees of MetroVision
or its subsidiaries who are not officers of MetroVision in
accordance with past practices, or grant any severance
or termination pay to, or enter into any employment or
severance agreement with any director, officer (except for
officers who are terminated on an involuntary basis) or
other employee of MetroVision or any of its
subsidiaries, or establish, adopt, enter into or amend any
Employee Plan other than as contemplated in this
Agreement;
(h) take any action to change accounting
policies or procedures (including, without limitation,
procedure with respect to revenue recognition, payments of
accounts payable and collection of accounts receivable);
(i) make any material tax election inconsistent
with past practices or settle or compromise any
material federal, state, local or foreign tax liability or agree
to an extension of a statute of limitation except to
the extent the amount of any such settlement has been
reserved for on MetroVision's most recent SEC Report;
(j) pay, discharge or satisfy any claims,
liabilities or obligations (absolute, accrued, asserted
or unassented, contingent or otherwise), other than the payment,
discharge or satisfaction in the ordinary course of
business and consistent with past practice of
liabilities reflected or reserved against in the financial
statements of MetroVision or incurred in the ordinary
course of business and consistent with past practice;
(k) enter into or commit to enter into any
contract, agreement, arrangement or understanding
having a term longer than six months unless such
contract, agreement, arrangement or understanding either (i) may
be canceled by it without penalty on not more than
thirty days' notice or (ii) does not require the
expenditure of more than $25,000 for any single contract,
agreement or arrangement and $50,000 for all such
contracts, arrangements and agreements;
(l) except as may be required by law, take any
action to terminate any of its Employee Plans;
(m) modify, amend or terminate any contract,
waive, release, relinquish or assign any contract or
other rights or claims or cancel or forgive any indebtedness
owed to it, other than in the ordinary course of business
consistent with past practice with respect to contracts
which are not material to MetroVision and its subsidiaries
taken as a whole; or (n) take, or agree in
writing or otherwise to take, any of the actions
described in Section 4.02(a) through (n) above, or any action
which would make any of the representations or
warranties of MetroVision contained in this Agreement
untrue or incorrect or prevent MetroVision from performing or
cause MetroVision not to perform its covenants
hereunder or result in any of the conditions to the
Merger set forth herein not being satisfied.
SECTION 4.03 No Solicitation by MetroVision.
(a) MetroVision shall not, directly or indirectly,
through any officer, director, employee, representative or agent
of MetroVision or any of its subsidiaries, solicit or encourage
(including by way of furnishing information) the initiation of
any inquiries or proposals regarding any merger, amalgamation,
take-over bid, sale of substantial assets, sale of shares of
capital stock (including without limitation by way of a tender
offer) or similar transaction involving MetroVision or any
subsidiaries of MetroVision (any of the foregoing inquiries or
proposals being referred to herein as an "MetroVision
Acquisition Proposal"); provided, however, that nothing
contained in this Agreement shall prevent the Board of Directors
of MetroVision, after consultation with its financial advisors,
and after receiving advice from outside counsel to the effect
that the Board of Directors is required to do so in order to
discharge properly its fiduciary duties, from considering,
negotiating, approving and recommending to the stockholders of
MetroVision an unsolicited bona fide MetroVision Acquisition
Proposal which the Board of Directors of MetroVision determines
in good faith would result in a transaction more favorable to
MetroVision's stockholders than the transaction contemplated by
this Agreement (any such Acquisition Proposal being referred to
herein as a "MetroVision Superior Proposal").
(b) MetroVision shall immediately notify York
Hannover after receipt of any MetroVision Acquisition Proposal
or any request for nonpublic information relating to MetroVision
or any of its subsidiaries in connection with a MetroVision
Acquisition Proposal or for access to the properties, books or
records of MetroVision or any subsidiaries by any person or
entity that informs the Board of Directors of MetroVision or
such subsidiary that it is considering making, or has made, a
MetroVision Acquisition Proposal. Such notice to York Hannover
shall be made orally and in writing and shall indicate in
reasonable detail the identity of the offeror and the terms and
conditions of such proposal, inquiry or contract.
(c) If the Board of Directors of MetroVision receives
a request for material nonpublic information by a party who
makes a bona fide MetroVision Acquisition Proposal and the Board
of Directors of MetroVision determines that such proposal is a
MetroVision Superior Proposal, then, and only in such case,
MetroVision may, subject to the execution of a confidentiality
and standstill agreement, provide such party with access to
information regarding MetroVision.
(d) MetroVision shall immediately cease and cause to
be terminated any existing discussions or negotiations with any
parties (other than York Hannover) conducted heretofore with
respect to any of the foregoing. MetroVision agrees not to
release any third party from any confidentiality or standstill
agreement to which MetroVision is a party.
(e) MetroVision shall ensure that the officers,
directors and employees of MetroVision and its subsidiaries and
any investment banker or other advisor or representative
retained by MetroVision are aware of the restrictions described
in this Section, and shall be responsible for any breach of this
Section 4.04 by such bankers, advisors and representatives.
SECTION 4.04 No Solicitation by York Hannover.
(a) York Hannover shall not, directly or indirectly,
through any officer, director, employee, representative or agent
of York Hannover or any of its subsidiaries, solicit or
encourage (including by way of furnishing information) the
initiation of any inquiries or proposals regarding any merger,
amalgamation, take-over bid, sale of substantial assets, sale of
shares of capital stock (including without limitation by way of
a tender offer) or similar transaction involving York Hannover
Partnership, York Hannover or any subsidiaries of York Hannover
(any of the foregoing inquiries or proposals being referred to
herein as a "York Hannover Acquisition Proposal"); provided,
however, that nothing contained in this Agreement shall prevent
the Board of Directors of York Hannover, after consultation with
its financial advisors, and after receiving advice from outside
counsel to the effect that the Board of Directors is required to
do so in order to discharge properly its fiduciary duties, from
considering, negotiating, approving and recommending to the
stockholders of York Hannover an unsolicited bona fide York
Hannover Acquisition Proposal which the Board of Directors of
York Hannover determines in good faith would result in a
transaction more favorable to York Hannover's stockholders than
the transaction contemplated by this Agreement (any such
Acquisition Proposal being referred to herein as a "York
Hannover Superior Proposal").
(b) York Hannover shall immediately notify
MetroVision after receipt of any York Hannover Acquisition
Proposal or any request for nonpublic information relating to
York Hannover or any of its subsidiaries in connection with a
York Hannover Acquisition Proposal or for access to the
properties, books or records of York Hannover or any
subsidiaries by any person or entity that informs the Board of
Directors of York Hannover or such subsidiary that it is
considering making, or has made, a York Hannover Acquisition
Proposal. Such notice to MetroVision shall be made orally and
in writing and shall indicate in reasonable detail the identity
of the offeror and the terms and conditions of such proposal,
inquiry or contract. (c) If the Board of Directors of
York Hannover receives a request for material nonpublic
information by a party who makes a bona fide York Hannover
Acquisition Proposal and the Board of Directors of York Hannover
determines that such proposal is a York Hannover Superior
Proposal, then, and only in such case, York Hannover may,
subject to the execution of a confidentiality and standstill
agreement, provide such party with access to information
regarding York Hannover.
(d) York Hannover shall immediately cease and cause
to be terminated any existing discussions or negotiations with
any parties (other than MetroVision) conducted heretofore with
respect to any of the foregoing. York Hannover agrees not to
release any third party from any confidentiality or standstill
agreement to which York Hannover is a Party.
(e) York Hannover shall ensure that the officers,
directors and employees of York Hannover and its subsidiaries
and any investment banker or other advisor or representative
retained by York Hannover are aware of the restrictions
described in this Section, and shall be responsible for any
breach of this Section 4.03 by such bankers, advisors and
representatives.
ARTICLE V
ADDITIONAL AGREEMENTS
SECTION 5.01 Preparation of S-4 and the Proxy
Statement. York Hannover and MetroVision promptly will prepare
and file with the Commission a proxy statement/prospectus (which
shall be the Proxy Statement) on Form S-4. Each of York
Hannover and MetroVision will use its best efforts to have the
S-4 declared effective under the Securities Act as promptly as
practicable after such filing. MetroVision also will take any
action (other than qualifying to do business in any jurisdiction
in which it is not now so qualified) required to be taken under
any applicable state securities laws in connection with the
issuance of MetroVision Common Shares pursuant to this
Agreement. York Hannover will furnish any audited financial
statements required under the Securities Act and all information
concerning York Hannover, the York Hannover Partnership and the
holders of its securities as reasonably may be requested in
connection with any such action.
SECTION 5.02 Stockholders' Meeting. MetroVision
shall call and hold the MetroVision Stockholders' Meeting as
promptly as practicable for the purpose of: (a) voting upon (i)
the approval of the Merger (ii) a 4.6 for 1 reverse stock split
of the MetroVision Common Shares, (iii) the election of
directors, (iv) the approval of the amendment of MetroVision's
1991 Plan; (iv) the amendment of MetroVision's Certificate of
Incorporation to increase the number of authorized shares and
change its name to York Hannover Health Care, Inc., (v) the
amendment of MetroVision's By-Laws to limit MetroVision's Board
of Directors to five (5) directors, each having a three (3) year
term, initially staggered as contemplated in Section 1.05,
(collectively, the "Approval Events") and (b) offering to the
holders of the MetroVision 5% Series A Preferred Stock the
opportunity to exchange any or all such shares (and all accrued
dividends thereon) for an aggregate of 800,00 MetroVision Common
Shares (on a post-reverse stock split basis). MetroVision shall
use its reasonable best efforts to solicit from holders of the
MetroVision Common Shares and the 5% Series A Preferred Stock
proxies in favor of the Approval of Events, and shall take all
other action necessary or advisable to secure the vote or
consent of stockholders required by New York Law to obtain such
approvals.
SECTION 5.03 Access to Information:
Confidentiality.
(a) Upon reasonable notice and subject to
restrictions contained in confidentiality agreements to which
such party is subject, York Hannover and MetroVision shall each
(and shall cause each of their subsidiaries to) afford to the
officers, employees, accountants, counsel and other
representatives of the other, reasonable access, during the
period prior to the Effective Time, to all its properties,
books, contracts, commitments and records and, during such
period, York Hannover and MetroVision each shall (and shall
cause each of their subsidiaries to) furnish promptly to the
other all information concerning its business, properties and
personnel as such other party may reasonably request, and each
shall make available to the other the appropriate individuals
(including attorneys, accountants and other professionals) for
discussion of the other's business, properties and personnel as
either party may reasonably request. Each party shall keep such
information confidential in accordance with the terms of the
confidentiality agreements, each dated April 16, 1996, as
amended (the "Confidentiality Agreements") between MetroVision
and York Hannover.
(b) MetroVision shall provide as promptly as
available drafts of MetroVision's Quarterly Report on Form
10-QSB for the quarter year ended June 30, 1996.
SECTION 5.04 Consents: Approval. York Hannover
and MetroVision shall each use their best efforts to obtain all
consents, waivers, approvals, authorizations or orders
(including, without limitation, all United States and foreign
governmental or regulatory agencies) required in connection with
the authorization, execution and delivery of this Agreement by
York Hannover and MetroVision and the consummation by them of
the transactions contemplated hereby. York Hannover and
MetroVision shall furnish all information required to be
included in the Proxy Statement, or for any application or other
filing to be made pursuant to the rules and regulations of any
United States or foreign governmental body in connection with
the transaction contemplated by this Agreement.
SECTION 5.05 Agreement of Affiliates. York Hannover shall
deliver to MetroVision, prior to the Effective Time, a letter
(the "Affiliate Letter") identifying all persons who are, or may
be deemed to be "affiliates" of York Hannover for purposes of
Rule 145 under the Securities Act. York Hannover shall use its
best efforts to cause each person who is identified as an
"affiliate" in the Affiliate Letter to deliver to MetroVision,
prior to the Effective Time, a written agreement (an "Affiliate
Agreement") in a form reasonably satisfactory to the parties to
the effect that such person will not offer to sell, sell or
otherwise dispose of any MetroVision Common Shares issued in the
Merger except pursuant to an effective registration statement,
in compliance with Rule 145 or in a transaction that, in the
opinion of legal counsel satisfactory to MetroVision, is exempt
from the registration requirements of the Securities Act.
SECTION 5.06 Indemnification and Insurance.
(a) To the extent permitted by New York Law, the
Certificate of Incorporation of MetroVision shall be amended to
contain the provisions with respect to indemnification set forth
in the By-Laws of York Hannover, which provisions shall not be
amended, repealed or otherwise modified for a period of six
years from the Effective Time in any manner that would adversely
affect the rights thereunder of individuals who at the Effective
Time were directors, officers, employees or agents of York
Hannover or MetroVision, unless such modification is required by
law.
(b) York Hannover shall, to the fullest extent
permitted under applicable law or under York Hannover's Articles
of Incorporation or By-Laws and regardless of whether the Merger
becomes effective, indemnify and hold harmless, and after the
Effective Time, the Surviving Corporation shall, to the fullest
extent permitted under applicable law or under Surviving
Corporation's Certificate of Incorporation or By-Laws, indemnify
and hold harmless, each present and former director, officer ,
employee, fiduciary and agent of York Hannover or any of its
subsidiaries (collectively, the "Indemnified Parties") against
any costs or expenses (including attorneys' fees), judgement,
fines, losses, claims, damages, liabilities and amounts paid in
settlement in connection with any claim, action suit, proceeding
or investigation, whether civil, criminal, administrative or
investigative, arising out of or pertaining to any action or
omission occurring at or prior to the Effective Time (including,
without limitation, the transactions contemplated by this
Agreement) for a period of six years after the date hereof. In
the event of any such claim, action, suit, proceedings or
investigations (whether arising before or after the Effective
Time) Surviving Corporation shall choose counsel for such
Indemnified Parties, unless the retention of such counsel on
behalf of such Indemnified Parties would create an actual
conflict of interest for such counsel in which case the
Indemnified Parties as a group may retain only one law firm to
represent them with respect to any single action unless there
is, under applicable standards of professional conduct, a
conflict on any significant issue between the positions of any
two or more Indemnified Parties. Any counsel retained by the
Indemnified Parties shall be reasonably satisfactory to
Surviving Corporation and Surviving Corporation shall not be
liable for any settlement effected without its written consent
(which consent shall not be unreasonably withheld).
(c) MetroVision shall, to the fullest extent
permitted under applicable law or under MetroVision's Articles
of Incorporation or By-Laws and regardless of whether the Merger
becomes effective, indemnify and hold harmless, and after the
Effective Time, Surviving Corporation shall, to the fullest
extent permitted under applicable law or under Surviving
Corporation's Certificate of Incorporation or By-Laws, indemnify
and hold harmless, each present and former director, officer,
employee, fiduciary and agent of MetroVision or any of its
subsidiaries (collectively, the "Indemnified Parties") against
any costs or expenses (including attorneys' fees), judgement,
fines, losses, claims, damages, liabilities and amounts paid in
settlement in connection with any claim, action suit, proceeding
or investigation, whether civil, criminal, administrative or
investigative, arising out of or pertaining to any action or
omission occurring at or prior to the Effective Time (including,
without limitation, the transactions contemplated by this
Agreement) for a period of six years after the date hereof. In
the event of any such claim, action, suit, proceedings or
investigations (whether arising before or after the Effective
Time) Surviving Corporation shall choose counsel for such
Indemnified Parties, unless the retention of such counsel on
behalf of such Indemnified Parties would create an actual
conflict of interest for such counsel in which case the
Indemnified Parties as a group may retain only one law firm to
represent them with respect to any single action unless there
is, under applicable standards of professional conduct, a
conflict on any significant issue between the positions of any
two or more Indemnified Parties. Any counsel retained by the
Indemnified Parties shall be reasonably satisfactory to
Surviving Corporation and Surviving Corporation shall not be
liable for any settlement effected without its written consent
(which consent shall not be unreasonably withheld).
SECTION 5.07. Notification of Certain Matters. York
Hannover shall give prompt notice to MetroVision, and
MetroVision shall give prompt notice to York Hannover, of (i)
the occurrence, or non-occurrence, of any event the occurrence,
or non-occurrence, of which would be likely to cause any
representation or warranty contained in the Agreement to be
untrue or inaccurate and (ii) any failure of York Hannover or
MetroVision, as the case may be, materially to comply with or
satisfy any covenant, condition or agreement to be complied with
or satisfied by it hereunder; provided, however, that the
delivery of any notice pursuant to this Section shall not limit
or otherwise affect the remedies available hereunder to the
party receiving such notice; and provided; further that failure
to give such notice shall not be treated as a breach of covenant
for the purposes of Sections 6.02(a) or 6.03(a) unless the
failure to give such notice results in material prejudice to the
other party.
SECTION 5.08 Further Action/Tax Treatment. Upon
the terms and subject to the conditions hereof, each of the
parties hereto shall use all reasonable efforts to take, or
cause to be taken, all actions and to do , or cause to be done,
all other things necessary, proper or advisable to consummate
and make effective as promptly as practicable the transactions
contemplated by this Agreement, to obtain in a timely manner all
necessary waivers, consents and approvals and to effect all
necessary registrations and filings, and to otherwise satisfy or
cause to be satisfied all conditions precedent to its
obligations under this Agreement. Each of MetroVision and York
Hannover shall use its best efforts to cause the Merger to
qualify, and will not (both before and after consummation of the
Merger) take any actions which could prevent the Merger from
qualifying as a reorganization under the provisions of Section
368 of the Code.
SECTION 5.09 Public Announcements. MetroVision and
York Hannover shall consult with each other before issuing any
press release or otherwise making any public statements with
respect to the Merger or this Agreement and shall not issue any
such press release or make any such public statement without the
prior consent of the other party, which shall not be
unreasonably withheld; provided, however, that a party may,
without the prior consent of the other party, issue such press
release or make such public statement as may upon the advice of
counsel be required by law or the NASD if it has used all
reasonable efforts to consult with the other party.
SECTION 5.10. Listing of Surviving Corporation Common
Shares. MetroVision and York Hannover shall use their
reasonable best efforts to cause the MetroVision Common Shares
to be issued in the Merger to be approved for listing on the
Nasdaq Small Cap Market.
SECTION 5.11. Conveyance Taxes. MetroVision and
York Hannover shall cooperate in the preparation, execution and
filing of all returns, questionnaires, applications, or other
documents regarding any real property transfer or gains, sales,
use, transfer, value added, stock transfer and stamp taxes, any
transfer, recording, registration and other fees, and any
similar taxes which become payable in connection with the
transactions contemplated hereby that are required or permitted
to be filed on or before the Effective Time.
ARTICLE VI
CONDITIONS TO THE MERGER
SECTION 6.01 Conditions to Obligation of Each Party
to Effect the Merger. The respective obligations of each party
to effect the Merger shall be subject to the satisfaction at or
prior to the Effective Time of the following conditions:
(a) Proxy Statement Clearance. No proceeding in
respect of the Proxy Statement shall have been initiated or
threatened by the SEC and the Proxy Statement shall
have been declared effective by the SEC;
(b) Stockholder Approval. The Approval Events shall
have been approved and adopted by the requisite vote of the
stockholders of MetroVision and this Agreement and the
Merger shall have been approved and adopted by the sole
shareholder of York Hannover;
(c) No Injunctions or Restraints; Illegality. No
temporary restraining order, preliminary or permanent
injunction or other order issued by any court of competent
jurisdiction or other legal restraint or
prohibition (an "Injunction") preventing the
consummation of the Merger shall be in effect, nor
shall any proceeding brought by any
administrative agency or commission or other governmental
authority or instrumentality,
domestic or foreign, seeking any of the foregoing be pending;
and there shall not be any
action
taken, or any statute, rule, regulation, or order enacted,
entered, enforced, or deemed
applicable to the Merger, which makes the consummation of the
Merger illegal;
(d) Nasdaq Small Cap Market listing. The Surviving
Corporation Common Shares shall have been approved for
listing, subject to notice of issuance, on the Nasdaq Small
Cap Market.
SECTION 6.02 Additional Conditions to Obligations of
York Hannover. The obligations of York Hannover to effect the
Merger are also subject to the following conditions:
(a) Representations and Warranties. The representations and
warranties of MetroVision contained in this Agreement shall be
true and correct in all respects on and as of the Effective
Time, except for (i) changes contemplated by this Agreement,
(ii) those representations and warranties which address matters
only as of a particular date (which shall remain true and
correct as of such date) and (iii) where the failure to be true
and correct would not have a Material Adverse Effect on
MetroVision, with the same force and effect as if made on and as
of the Effective Time, and York Hannover shall have received a
certificate to such effect signed by the President and Chief
Financial Officer of MetroVision;
(b) Agreements and Covenants. MetroVision shall have
performed or complied in all material respects with all
agreements and covenants required by this Agreement to be
performed or complied with by it on or prior to the Effective
Time, and York Hannover shall have received a certificate to
such effect signed by the President and Chief Financial Officer
of MetroVision;
(c) Consents Obtained. All material consents,
waivers, approvals, authorizations or orders required to be
obtained, and all filings required to be made by MetroVision for
the authorization, execution and delivery of this Agreement and
the consummation by it of the transactions contemplated hereby
shall have been obtained and made by MetroVision;
(d) Governmental Actions. There shall not have been
instituted, pending or threatened any action or proceeding (or
any investigation or other inquiry that might result in such an
action or proceeding) by any governmental authority or
administrative agency before any governmental authority,
administrative agency or court of competent jurisdiction, nor
shall there be in effect any judgment, decree or order of any
governmental authority, administrative agency or court of
competent jurisdiction, in either case, seeking to prohibit or
limit the Surviving Corporation from exercising all material
rights and privileges pertaining to the ownership or operation
by the Surviving Corporation or any of its subsidiaries of all
or a material portion of the business or assets of York Hannover
or any of its subsidiaries, or seeking to compel the Surviving
Corporation or any of its subsidiaries to dispose of or hold
separate all or any material portion of the business or assets
of York Hannover or any of its subsidiaries, as a result to the
Merger or the transactions contemplated by this Agreement.
(e) Material Adverse Change. Since the date of this
Agreement, there shall have been no change, occurrence or
circumstance in the business, results of operations or financial
condition of MetroVision or any subsidiary of MetroVision having
or reasonably likely to have a Material Adverse Effect;
(f) Reverse Stock Split. MetroVision shall have
obtained shareholder approval of and executed a 4.6 for 1
reverse stock split of MetroVision Common Shares at or prior to
the Effective Time. All warrants and options shall be repriced
and split accordingly, with consents and notice to all holders,
if required.
(g) MetroVision Net Loss. Loss shall mean operating
loss before depreciation and amortization as shown on
MetroVisions consolidated statement of operations for said
quarter; and MetroVision Subsequent Financials for the second
quarter of 1996 shall reflect a Net Loss (as defined below) no
greater than $50,000.00. As used herein, Net Loss shall mean
operating loss before interest, income taxes, depreciation and
amortization as shown on MetroVision's consolidated statement of
operations for said quarter but shall not include the costs
associated with the transactions contemplated by this Agreement;
(h) Employment Agreements. The Surviving Corporation
shall have executed employment agreements with Lawrence B.
Cummings and Thomas M. Clarke in a form reasonably satisfactory
to the parties hereto and to Messrs, Cummings and Clarke,
pursuant to which Messrs, Cummings and Clarke shall be granted
warrants for each to purchase an additional 750,000 MetroVision
Common Shares. The first tranche of warrants representing
250,000 Common Shares each to Mr. Cummings and Mr. Clarke shall
be exercisable at any time within 36 months of the Effective
Time, at a price equal to the average or the closing bid price
of the MetroVision Common Shares for the first ten trading days
after the Effective Time (the "First Year Exercise Price"). The
second 250,000 Common Shares tranche of warrants may be
exercised at any time between the thirteenth (13th) and
forty-eighth (48th) month after the Effective Time at a price
equal to 125% of the First Year Exercise Price. The final
250,000 Common Shares tranche of warrants may be exercised
between the twenty-fifth (25th) and the sixtieth (60th) months
after the Effective Time at a price equal to 150% of the First
Year Exercise Price.
(h) Tax Effect. York Hannover shall receive the
advice of counsel that the merger will constitute a
reorganization within the meaning of Code Section 368 (a) (1)
(A). SECTION 6.03 Additional Conditions to
Obligation of MetroVision. The obligation of MetroVision to
effect the Merger is also subject to the following conditions:
(a) Representations and Warranties. The
representations and warranties of York Hannover contained in the
Agreement shall be true and correct in all respects on and as of
the Effective Time, except for (i) changes contemplated by this
Agreement, (ii) those representations and warranties which
address matters only as of a particular date (which shall remain
true and correct as of such date) and (iii) where the failure to
be true and correct would not have a Material Adverse Effect on
York Hannover, with the same force and effect as if made on and
as of the Effective Time, and MetroVision shall have received a
certificate to such effect signed by the Chief Executive Officer
and President of York Hannover;
(b) Agreement and Covenants. York Hannover shall
have performed or complied in all material respects with all
agreements and covenants required by this Agreement to be
performed or complied with by them on or prior to the Effective
Time, and MetroVision shall have received a certificate to such
effect signed by the Chief Executive Officer and President of
York Hannover;
(c) Consents Obtained. All material consents,
waivers, approvals, authorizations or orders required to be
obtained, and all filings required to be made, by York Hannover
for the authorization, execution and delivery of this Agreement
and the consummations by them of the transactions contemplated
hereby shall have been obtained and made by York Hannover;
(d) Material Adverse Change. Since the date of this
Agreement, there shall have been no change, occurrence or
circumstance in the business, results of operations or financial
condition of York Hannover or any subsidiary of York Hannover
having or reasonably likely to have a Material Adverse Effect;
and
(e) Affiliate Agreements. MetroVision shall have
received from each person who is identified in the Affiliate
Letter as an "affiliate" of York Hannover, an Affiliate
Agreement, and such Affiliate Agreement shall be in full force
and effect;
(f) York Hannover Indebtedness. The NHC Loan shall
have been paid in full utilizing the proceeds from the issuance
of the York Hannover 12% Preferred Stock and the security
interest related thereto shall have been released.
(g) Audited York Hannover Financials. MetroVision
shall have received from York Hannover audited York Hannover
Financials on or before June 21, 1996 as provided under Section
2.07, reflecting no Material Adverse Change.
(h) Tax Effect. MetroVision shall receive the advice
of counsel that the merger will constitute a reorganization
within the meaning of Code Section 368 (a) (1) (A).
ARTICLE VII
TERMINATION
SECTION 7.01 Termination. This Agreement may be
terminated at any time prior to the Effective Time,
notwithstanding approval thereof by the stockholder of York
Hannover or MetroVision;
(a) by mutual written consent duly authorized by the
Boards of Directors of MetroVision and York Hannover; or
(b) by either MetroVision or York Hannover if the Merger
shall not have been consummated by October 31, 1996 (provided,
that, the right to terminate this Agreement under this Section
7.01 (b) shall not be available to any party whose failure to
fulfill any obligation under this Agreement has been the cause
of or resulted in the failure of the Merger to occur on or
before such date); or
(c) by either MetroVision or York Hannover if a court
of competent jurisdiction or governmental, regulatory or
administrative agency or commission shall have issued a
nonappealable final order, decree or ruling or taken any other
action, in each case having the effect of permanently
restraining, enjoining or otherwise prohibiting the Merger; or
(d) by MetroVision or York Hannover, if, at the
MetroVision Stockholders' Meeting (including any adjournment or
postponement thereof), the requisite vote of the stockholders of
MetroVision shall not have been obtained; or (e) by
York Hannover, if (i) the Board of Directors of MetroVision
shall withdraw, modify or change its recommendation of this
Agreement or the Merger in a manner adverse to York Hannover or
shall have resolved to do so; (ii) the Board of Directors of
MetroVision shall have taken a "neutral"position with respect to
an Alternative Transaction (as defined in Section 7.03(d)); or
(iii) a tender offer or exchange offer for 15% or more of the
outstanding MetroVision Common Shares is commenced (other than
by York Hannover or an affiliate of York Hannover); or
(f) by MetroVision or York Hannover, upon a breach of
any representation, warranty, covenant or agreement on the part
of York Hannover or MetroVision, respectively, set forth in this
Agreement or if any representation or warranty of MetroVision or
York Hannover, respectively, shall have become untrue, in either
case, such that the conditions set forth in Section 6.02(a) or
6.02(b), or Section 6.03 (a) or 6.03(b), would not be satisfied
(a "Terminating Breach"), provided, that, if such Terminating
Breach is curable prior to the expiration of 30 days from its
occurrence (but in no event later than October 31, 1996) by
MetroVision or York Hannover, as the case may be, through the
exercise of its reasonable best efforts and for so long as
MetroVision or York Hannover, as the case may be, continues to
exercise such reasonable best efforts, neither York Hannover nor
MetroVision, respectively, may terminate this Agreement under
this Section 7.01(f) until the expiration of such period without
such Terminating Breach having been cured; or
(g) by York Hannover or MetroVision, if the Board of
Directors of MetroVision shall have resolved to accept, or
accepted, a MetroVision Superior Proposal; or
(h) by York Hannover or MetroVision if the Board of
Directors of York Hannover shall resolved to accept, or
accepted, a York Hannover Superior Proposal.
SECTION 7.02 Effect of Termination. In the event of
the termination of this Agreement pursuant to Section 7.01, this
Agreement shall forthwith become void and there shall be no
liability on the part of any party hereto or any of its
affiliates, directors, officers or stockholders except as set
forth in Section 7.03 and Section 8.01 hereof.
SECTION 7.03 Fees and Expenses.
(a) Except as set forth in this Section 7.03, all fees
and expenses incurred in connection with this Agreement and the
transactions contemplated hereby shall be paid by the party
incurring such expenses, whether or not the Merger is
consummated. (b) MetroVision shall pay York Hannover a
termination fee of $25,000.00 (the "Fee"), in lieu of any
actual damages including documented and reasonable out-of-pocket
expenses of York Hannover relating to the transactions
contemplated by the Agreement, upon the earliest to occur of the
following events:
(i) the termination of this Agreement by York
Hannover pursuant to Section 7.01(e) or (g); or
(ii) the termination of this Agreement by York Hannover
pursuant to Section 7.01(f) after a breach by
MetroVision of this Agreement.
(c) York Hannover shall pay MetroVision a
termination fee of $25,000.00 (the "Fee"), in lieu of any
actual damages including documented and reasonable out-of-pocket
expenses of MetroVision relating to the transactions
contemplated by the Agreement, upon the termination of this
Agreement by MetroVision pursuant to Section 7.01(f) after a
breach by York Hannover of this Agreement or upon the
termination of this Agreement by MetroVision pursuant to Section
7.01 (h).
(d) As used herein, "MetroVision Alternative
Transaction" means either (i) a transaction pursuant to which
any person (or group of persons) other than York Hannover or its
affiliates (a "Third Party") acquires more that 15 percent of
the outstanding MetroVision Common Shares, whether from
MetroVision or pursuant to a tender offer or exchange offer or
otherwise, (ii) a merger or other business combination involving
MetroVision pursuant to which any Third Party acquires more than
15 percent of the outstanding equity securities of MetroVision
or the entity surviving such merger or business combination or
(iii) any other transaction pursuant to which any Third Party
acquires control of assets (including for this purpose the
outstanding equity securities of subsidiaries of MetroVision,
and the entity surviving any merger or business combination
including any of them) of MetroVision, any of its subsidiaries
having a fair market value (as determined by the board of
Directors of MetroVision in good faith) equal to more than 15
percent of the fair market value of all the assets of
MetroVision, and its subsidiaries, taken as a whole, immediately
prior to such transaction; provided, however, that the term
MetroVision Alternative Transaction shall not include any
acquisition of securities by a broker dealer in connection with
a bona fide public offering of such securities.
(e) As used herein, "York Hannover Alternative
Transaction" means either (i) a transaction pursuant to which
any person (or group of persons) other than MetroVision or its
affiliates (a "Third Party") acquires more that 15 percent: (a)
of the outstanding York Hannover Common Shares, or (b) the
interests in the York Hannover Partnership, whether from York
Hannover or the York Hannover Partnership or pursuant to a
tender offer or exchange offer or otherwise, (ii) a merger or
other business combination involving York Hannover or the York
Hannover Partnership pursuant to which any Third Party acquires
more than 15 percent of (a) the outstanding equity securities of
York Hannover or (b) the interests in the York Hannover
Partnership or the entity surviving such merger or business
combination or (iii) any other transaction pursuant to which any
Third Party acquires control of assets (including for this
purpose the outstanding equity securities of subsidiaries of
York Hannover, and the entity surviving any merger or business
combination including any of them) of York Hannover, any of its
subsidiaries having a fair market value (as determined by the
board of Directors of York Hannover in good faith) equal to more
than 15 percent of the fair market value of all the assets of
York Hannover, and its subsidiaries, taken as a whole,
immediately prior to such transaction; provided, however, that
the term York Hannover Alternative Transaction shall not include
any acquisition of securities by a broker dealer in connection
with a bona fide public offering of such securities.
(f) The Fee payable pursuant to Section 7.03(b) or
(c) shall be paid within ten business days after the first to
occur of the events described in Section 7.03(b) or 7.03(c)
respectively.
ARTICLE VIII
GENERAL PROVISIONS
SECTION 8.01 Effectiveness of Representations,
Warranties and Agreements. Except as otherwise provided in this
Section 8.01, the representations, warranties and agreements of
each party hereto shall remain operative and in full force and
effect regardless of any investigation made by or on behalf of
any other party hereto, any person controlling any such party or
any of their officers or directors, whether prior to or after
the execution of this Agreement. The representations,
warranties and agreements in this Agreement shall terminate at
the Effective Time or upon the termination of this Agreement
pursuant to Section 7.01, as the case may be, except that the
agreements set forth in Section 5.05 and 5.06 shall survive the
Effective Time for the periods described in such sections and
those set forth in Sections 5.03 shall survive termination
indefinitely. The Confidentiality Agreements shall survive
termination of this Agreement as provided therein.
SECTION 8.02. Notices. All notices and other
communications given or made pursuant hereto shall be in writing
and shall be deemed to have been duly given or made as of the
date delivered or mailed if delivered personally or mailed by
registered or certified mail (postage prepaid, return receipt
requested) to the parties as the following addresses (or at such
other address for a party as shall be specified by like changes
of address shall be effective upon receipt) or sent by
electronic transmission, with confirmation received, to the
telecopy number specified below:
(a) If to York Hannover:
YORK HANNOVER PHARMACEUTICALS, INC.
2 South Street, Suite 360 Pittsfield, MA 01201
Attention: Thomas M. Clarke, President
Fax (413) 448-2120
With a copy to:
MARTIN & OLIVEIRA 100 North Street, Suite 301
Pittsfield, MA 01201 Attention: William
E. Martin, Esquire Fax (413) 445-5883
(b) If to MetroVision:
METROVISION OF NORTH AMERICA, INC. 424 Madison
Avenue, 9th Floor New York, NY 10017
Attention: Robert F. Hussey, President Fax (212)
759-3181
With a copy to:
SHEREFF, FRIEDMAN, HOFFMAN & GOODMAN, LLP
919 Third Avenue New York, NY 10022
Attention: Charles I. Weissman, Esquire Fax
(212) 758-9526
SECTION 8.03 Certain Definitions. For purposes of this
Agreement, the term:
(a) "affiliates" means a person that directly or
indirectly, through one or more intermediaries, controls, is
controlled by, or is under common control with, the first
mentioned person; including, without limitation, any partnership
or joint venture in which York Hannover (either alone, or
through or together with any other subsidiary) has, directly or
indirectly, an interest of 5 percent or more; (b)
"beneficial owner" with respect to any shares of stock, means a
person who shall be deemed to be the beneficial owner of such
shares (i) which such person or any of its affiliates or
associates beneficially owns, directly or indirectly, (ii) which
such person or any of its affiliates or associates (as such term
is defined in Rule 12b-2 of the Exchange Act) has, directly or
indirectly, (A) the right to acquire (whether such right is
exercisable immediately or subject only to the passage of time),
pursuant to any agreement, arrangement or understanding or upon
the exercise of consideration rights, exchange rights, warrants
or options, or otherwise, or (B) the right to vote pursuant to
any agreement, arrangement or understanding or (iii) which are
beneficially owned, directly or indirectly, by any other persons
with whom such person or any of its affiliates or associates has
any agreement, arrangement or understanding of the purpose of
acquiring, holding, voting or disposing of any shares;
(c) "business day" means any day other than a day on
which banks in New York are required or authorized to be closed;
(d) "control" (including the terms "controlled by"
and "under common control with") means the possession, directly
or indirectly or as trustee or executor, of the power to direct
or cause the direction of the management or policies of a
person, whether through the ownership of stock, as trustee or
executor, by contract or credit arrangement or otherwise;
(e) "person" means an individual, corporation,
partnership, association, trust, unincorporated organization,
other entity or group (as defined in Section 13(d)(3) of the
Exchange Act); and (f) "subsidiary" or "subsidiaries"
of York Hannover, or MetroVision or any other person means any
corporation, partnership, joint venture or other legal entity of
which York Hannover, or MetroVision or such other person, as
the case may be, (either alone or through or together with any
other subsidiary) owns, directly or indirectly, more than 50% of
the stock or other equity interests the holders of which are
generally entitled to vote for the election of the board of
directors or other governing body of such corporation or other
legal entity.
SECTION 8.04 Amendment. This Agreement may be
amended by the parties hereto by action taken by or on behalf of
their respective Boards of Directors at any time prior to the
Effective Time; provided, however, that, after approval of the
Merger by the stockholders of MetroVision, no amendment may be
made which by law requires further approval by such stockholders
without such further approval. This Agreement may not be
amended except by an instrument in writing signed by the parties
hereto.
SECTION 8.05 Waiver. At any time prior to the
Effective Time, any party hereto may with respect to any other
party hereto (a) extend the time for the performance of any of
the obligations or other acts, (b) waive any inaccuracies in the
representations and warranties contained herein or in any
document delivered pursuant hereto and (c) waive compliance with
any of the agreements or conditions contained herein. Any such
extension or waiver shall be valid if set forth in an instrument
in writing signed by the party or parties to be bound thereby.
SECTION 8.06 Headings. The headings contained in
this Agreement are for reference purposes only and shall not
affect in any way the meaning or interpretation of this
Agreement.
SECTION 8.07. Severability. If any term or other
provision of this Agreement is invalid, illegal or incapable of
being enforced by any rule of law, or public policy, all other
conditions and provisions of this Agreement shall nevertheless
remain in full force and effect so long as the economic or legal
substance of the transactions contemplated hereby is not
affected in any manner adverse to any party. Upon such
determination that any term or other provision is invalid,
illegal or incapable of being enforced, the parties hereto shall
negotiate in good faith to modify this Agreement so as to effect
the original intent of the parties as closely as possible in an
acceptable manner to the end that transactions contemplated
hereby are fulfilled to the extent possible.
SECTION 8.08 Entire Agreement. This Agreement
constitutes the entire agreement and supersedes all prior
agreements and undertakings (other than the Confidentiality
Agreement), both written and oral, among the parties, or any of
them, with respect to the subject matter hereof and, except as
otherwise expressly provided herein, are not intended to confer
upon any other person any rights or remedies hereunder.
SECTION 8.09 Assignment. This Agreement shall not
be assigned by operation of law or otherwise.
SECTION 8.10. Parties in Interest. This Agreement
shall be binding upon and inure solely to the benefit of each
party hereto, and nothing in this Agreement, express or implied,
is intended to or shall confer upon any other person any right,
benefit or remedy of any nature whatsoever under or by reason of
this Agreement, other than Section 5.07 (which is intended to be
for the benefit of the Indemnified Parties and may be enforced
by such Indemnified Parties).
SECTION 8.11 Failure or Indulgence Not Waiver;
Remedies Cumulative. No failure or delay on the part of any
party hereto in the exercise of any right hereunder shall impair
such right or be construed to be a waiver of, or acquiescence
in, any breach of any representation, warranty or agreement
herein, nor shall any single or partial exercise of any such
right preclude other or further exercise thereof or of any other
right. All rights and remedies existing under this Agreement
are cumulative to, and not exclusive of, any rights or remedies
otherwise available.
SECTION 8.12. Governing Law. This agreement
shall be governed by and construed in accordance with, the
internal laws of the State of New York applicable to contracts
executed and fully performed within the State of New York.
SECTION 8.13. Counterparts. This Agreement may
be executed in one or more counterparts, and by the different
parties hereto in separate counterpart, each of which when
executed shall be deemed to be an original but all of which
taken together shall constitute one and the same agreement.
SECTION 8.14. Waiver of Jury Trial. Each of
MetroVision and York Hannover hereby irrevocably waives, to the
fullest extent permitted by law, all rights to trial by jury in
any action, proceeding, or counterclaim (whether based upon
contract, tort or otherwise) arising out of or relating to this
agreement or any of the transactions contemplated hereby.
IN WITNESS WHEREOF, MetroVision and York Hannover have caused
this Agreement to be executed as of the date first written above
by their respective officers thereunto duly authorized.
METROVISION OF NORTH AMERICA, INC.
By:
____________________________________
Robert F. Hussey, its President
YORK HANNOVER PHARMACEUTICALS, INC.
By:
____________________________________
Thomas M. Clarke, its President
Agreed and Assented to
this ___ day of April, 1996.
STOCKBRIDGE INVESTMENT PARTNERS, INC.
By:________________________________________
Thomas M. Clarke its
President
EXHIBIT A
YORK HANNOVER DISCLOSURE SCHEDULE
EXHIBIT B
METROVISION DISCLOSURE SCHEDULE
DISCLOSURE SCHEDULE SECTION 2.01.
(a) York Hannover Pharmaceuticals
York Hannover, a Florida corporation is not qualified to do
business as a foreign corporation in any other state.
(b) York Hannover Partnership
York Hannover Partnership, a Wisconsin partnership is qualified
to do business as a foreign corporation in the state of Florida.
DISCLOSURE SCHEDULE SECTION 2.02.
Capital Stock
(a) York Hannover Pharmaceuticals
As of December 31, 1995 the authorized capital stock of York
Hannover consist of 11,000 shares of Company Common Stock at par
value of $.10 and 10,000 shares of Preferred Stock at par value
of $.01 of which 5,000 shares have been designated Cumulative
Preferred Stock. Of the capital stock, 1,000 shares of common
stock, held by Stockbridge Investment Partners, Inc., and 3,168
shares of 15% cumulative preferred stock were issued and
outstanding and all are validly issued, fully paid and
non-assessable. No material change in such capitalization has
occurred or will occur between December 31, 1995 and the
Effective Time except all 15% cumulative preferred shares will
be fully redeemed or canceled and 1,950 of 12% Preferred Stock
will be issued, conditioned upon lender's consent. Stockbridge
Investment Partners, Inc. entered into a Stockholders' Agreement
on August 18, 1994 and Amendment No. 1 of said Agreement on July
11, 1995 which outlines stock transfer restrictions and
restrictions on certain actions required by the corporation or
any subsidiary.
(b) York Hannover Partnership
An Agreement of General Partnership was entered into on July 13,
1995 by and between York Hannover Pharmaceuticals, Inc. a
Florida Corporation and United Professional Companies, Inc. a
Delaware Corporation. The respective Percentage Interests of
the Partners is United Professional Corporation 60.0% and York
Hannover Pharmaceuticals, Inc. 40.0% DISCLOSURE
SCHEDULE SECTION 2.03.
Article of Incorporation and By-Laws:
Subsidiaries of York Hannover
Complete and correct copy of the Articles of Incorporation and
Partnership Agreement are attached hereto.
DISCLOSURE SCHEDULE SECTION 2.04.
Validity and Conflicts
(a) York Hannover Pharmaceuticals
Condition of issuance of the 12% Preferred Stock will be based
on the consent of National Health Care, L.P. as lien holder of
the $1,950,000 loan and accrued interest in the amount of
$104,084.75 as of March 31, 1996.
(b) York Hannover Partnership
None. DISCLOSURE SCHEDULE SECTION 2.07.
(a) The York Hannover Financials
Completed unaudited financials are attached hereto.
(b) The York Hannover Partnership Financials
Completed unaudited financials are attached hereto.
DISCLOSURE SCHEDULE SECTION 2.08.
Absence of Adverse Change
None. DISCLOSURE SCHEDULE SECTION 2.09.
Licenses
All necessary licenses and approvals are held in the name of
York Hannover Partnership which the company has a 40% interest.
(b) York Hannover Partnership
1. United States Controlled substance registration certificate.
2. State of Florida Department of Business and Professional
Regulation Board of Pharmacy.
3. State of Florida Department of Health and Rehabilitative
Services Drugs, Devices, Cosmetics-General Retailer and Drug
Wholesaler.
4. Pinellas County Occupational license.
5. Hernando County Occupational license.
DISCLOSURE SCHEDULE SECTION 2.13.
Material Contracts
(a) York Hannover Pharmaceuticals
1. General Partnership Agreement, dated July 13, 1995, between
York Hannover and United Professional Companies, Inc.
("UPC").
2. Assignment and Assumption Agreement, dated July 13, 1995,
between York Hannover and UPC.
3. Put Agreement, dated July 13, 1995, between York Hannover
and UPC.
4. Subscription Agreement for issuance of 12% cumulative
preferred stock.
5. National Health Care, L.P. debt agreement to be refinanced
prior to the Effective Time.
6. Thomas M. Clarke guarantee agreement with National Health
Care, L.P.
7. Lawrence B. Cummings guarantee agreement with National
Health Care, L.P.
(b) York Hannover Partnership
1. Pharmacy Services Agreement.
2. Medicaid Provider Agreement.
3. Medicaid Provider Bond.
4. Lenox Healthcare, Inc. billing service Agreement.
5. United Professional Companies, Inc. Management Agreement.
6. Pharmacy contract with both United Professional Companies,
Inc. and York Hannover Partnership.
7. Employment Agreement with Kenneth Norfleet.
DISCLOSURE SCHEDULE SECTION 2.14.
Insurance
(a) York Hannover Pharmaceuticals
Workers Compensation Bond.
(b) York Hannover Partnership
Insurance Type of Policy Effective
Company Coverage Number Dates
Premium
The ST. Commercial FK06804091 10/01/95
Annual Paul General Liability 10/01/96
The ST. Health Care FK06804091 10/01/95
Annual Paul Facility Property
10/01/96
The ST. Health Care FK06804091 10/01/95
Annual Paul Facility Medical
10/01/96 Professional Liability Protection
The ST. Auto Coverage FK0680491 10/01/95 Annual
Paul 10/01/96
DISCLOSURE SCHEDULE SECTION 2.15.
Litigation
(a) York Hannover Pharmaceuticals, Inc.
1. York Hannover Pharmaceuticals, Inc. vs. Amserv Healthcare,
Inc. case number 14921. Complaint - failure to hold an
annual meeting for a period within either 30 days after the date
designated in By-laws.
2. Amserv Healthcare, Inc. vs. York Hannover Pharmaceuticals,
Inc. case number 96-686-EG-CGA. Complaint - failure to make
required filings and disclosure in connection with an illegal
accumulation of Amserv common stock.
(b) York Hannover Partnership
None. DISCLOSURE SCHEDULE SECTION 2.16.
Employee Plans and Contracts
(a) York Hannover Pharmaceuticals
None.
(b) York Hannover Partnership
1. Employment Agreement with Kenneth Norfleet.
2. York Hannover Partnership employee benefit program.
DISCLOSURE SCHEDULE SECTION 2.17.
Trade Names
York Hannover Partnership, currently conducting business in the
state of Florida, intends to adopt the name UPC Health Network.
DISCLOSURE SCHEDULE SECTION 2.20.
Disclosed Liabilities
The loan with National Health Care, L.P. in the amount of
$1,950,000 and accrued interest as of March 31, 1996 in the
amount of $104,084.75. DISCLOSURE SCHEDULE
SECTION 3.01.
MetroVision is qualified to do business as a foreign corporation
in the following states: California, Illinois, Massachusetts,
New Jersey and Pennsylvania. DISCLOSURE SCHEDULE
SECTION 3.02.
Capital Stock
The authorized capital stock of MetroVision consists of
10,000,000 shares of MetroVision Common Shares and 2,000,000
shares of MetroVision preferred stock, $.001 par value of which
720,000 shares of MetroVision Preferred Stock have been
designated as the 5% Series A Preferred Stock. No change in
such capitalization has occurred or will occur between December
31, 1995 and the Effective Time. The following stock, purchase,
warrants and options have been issued or granted.
Common Stock
6,987,880 Class B Warrants (exercise price
$.20) (expires 11/96) 793,850 5% Convertible Preferred
Stock 648,535
Employee Stock Options (exercise price $.20 - $.25)
1,015,000 Director Options ($.74 expires 1993)
64,000 ($.16 expires 1994)
($.16 expires 1995)
($.25 expires 1996)
1993 Bridge Warrants ($2.00) (expires 5/96)
40,000 1993 Bridge Warrants ($.83) (expires 9/98)
80,000
Whale Unit Warrants ($1.00)*
480,000 Whale Warrants ($.20)
80,000
Whale IPO Unit Warrants ($.74)*
337,838
Transportation Displays, Inc. (TDI) Warrants ($2.50)
. . . . 12,484
Fully Diluted
10,539,587
There is an agreement between MetroVision and certain
holders of options and warrants to purchase MetroVision Common
Shares and holders of 5% Series A Preferred Stock.
* MetroVision has agreed with Whale Securities Co., L.P.,
that the warrants owned by Whale will have an exercise price of
$0.40 on a post reverse-split basis. DISCLOSURE
SCHEDULE SECTION 3.03.
Article of Incorporation and By-Laws:
Subsidiaries of MetroVision
Complete and correct copy of the Articles of Incorporation and
By-Laws are attached hereto. DISCLOSURE SCHEDULE
SECTION 3.04.
Validity and Conflicts.
None. DISCLOSURE SCHEDULE SECTION 3.07.
The MetroVision Financials
MetroVision's Annual Report on Form 10-K for the year ending
December 31, 1995 and a draft of Metrovision's Quarterly Report
on Form 10-Q for the period ending March 31, 1996 are attached
hereto. DISCLOSURE SCHEDULE SECTION 3.08.
Absence of Adverse Change
None. DISCLOSURE SCHEDULE SECTION 3.09.
Licenses
1. License of software pursuant to agreement, dated November
1, 1992, between MetroVision and Target Vision, Inc.
2. Foreign qualifications to do business in California,
Illinois, Massachusetts, New Jersey and Pennsylvania.
3. Operating agreements with transit and airport authorities
as indicated on Disclosure Schedule Section 3.13.
DISCLOSURE SCHEDULE SECTION 3.13.
Material Contracts
1. Unit Purchase Option sold to Whale Securities Co., L.P. in
December, 1991. 2. Underwriter's Warrant Agreement between the
Company and Whale Securities Co., L.P. 3. Class B Warrant
Agreement and Warrant Certificate. 4. Agreement, dated
November 1, 1992, between MetroVision and Target Vision, Inc.
("TV") relating the licensing of software. 5. Agreement,
dated August 9, 1989, between the company and Port Authority
Trans Hudson Corporation ("PATH"). 6. Agreement, dated
August 15, 1995, between the Company and the Southeastern
Pennsylvania Transportation Authority ("SEPTA"). 7.
Agreement, dated January 19, 1987, between the Company and the
San Francisco Bay Area Rapid Transit District ("BART"). 8.
Agreement, dated August 13, 1992, between the Company and the
Massachusetts Bay Transportation Authority ("MBTA"). 9.
1991 Stock Option Plan. 10. 1993 Non Employee Directors Stock
Option Plan. 11. Agreement, dated as of October 28, 1991,
between TouchTel, Inc. and the Port Authority of New York
and New Jersey ("NYAIR"). 12. Warrant, dated May 24, 1993,
issued to Robert F. Hussey. 13. Agreement, dated March 8, 1993,
between the Company and Chiel Communications America, Inc.
14. Form of Warrant, dated September 1993, issued to Bridge
Investors. 15. Agreement between the Company and certain
holders of options and warrants to purchase the Company's
Common Shares and 5% Preferred Stock. 16. Agreement, dated
August 2, 1995, between the company and the New Jersey Transit
Authority ("NJT").
DISCLOSURE SCHEDULE SECTION 3.14.
Insurance
Insurance Type of Effective Company
Coverage Policy No. Dates Premium
TVLRS Officer's Life L4574955 01/10/96
Annual 01/10/97
USF&G Auto-Villager 1AB30041991102 10/27/95
Semi-Annual 10/27/96
USF&G Auto-Van 1AB30041991102 03/31/96
10/27/96
USF&G Auto Cube 1MP300534290 10/27/95
Semi-Annual General Liability
10/27/96 Property
USF&G Health Insurance TN 520617 Monthly
Workmen's Compensation
CIGNA Mass 05/05/95 Annual
05/05/96
USF&G New York 05/05/95 Installm'ts
05/05/96
USF&G Pennsylvania 05/05/95
Installm'ts 05/05/96
USF&G California 05/05/95
Installm'ts 05/05/96
DISCLOSURE SCHEDULE SECTION 3.16.
Employee Plans and Contracts
1. 1991 Employee Stock Option Plan
2. 1993 Non-Employee Directors Stock Option Plan
DISCLOSURE SCHEDULE SECTION 3.15
Litigation
MetroVision has received notice from NASDAQ that it is not in
compliance with NASDAQ's listings requirements. MetroVision has
a meeting schedule with NASDAQ for May 14, 1996.
DISCLOSURE SCHEDULE SECTION 3.17.
Trade Names
MetroVision has registered its trademarks, "Commuter Channel"
and "Flight Channel" with the United States Patent and Trademark
Office covering the broadcast of video transmissions in the mass
transit and air travel industries, respectively. The term of
these registrations is 20 years (expiring in 2010).
DISCLOSURE SCHEDULE SECTION 3.20.
Disclosed liabilities
1. Dispute between MetroVision and Massachusetts Bay Transit
Authority (MBTA) concerning accounts receivable in the amount of
$32,250 and accounts payable in the amount of $25,886.
2. MetroVision is in default of principal pay back of the loan
with Nations Bank of Georgia in the amount of $76,000.
