<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT PURSUANT TO SECTION 13 OR 15 (d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of report (date of earliest event reported): March 9, 1995
PACIFIC TELECOM, INC.
(Exact name of registrant as specified in Charter)
State of Washington 0-873 91-0644974
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File No.) Identification No.)
805 Broadway
Vancouver, Washington
(Address of principal 98668-8701
executive offices) (Zip Code)
Registrant's telephone number, including area code: (360)905-5800
No Change
(Former name or former address, if changed since last report)
<PAGE>
ITEM 5. OTHER EVENTS
On March 9, 1995, Pacific Telecom, Inc. (the Company) entered
into an Agreement and Plan of Merger (the Merger Agreement) with
PacifiCorp Holdings, Inc. (Holdings) and PXYZ Corporation, pursuant to
which Holdings, a wholly-owned subsidiary of PacifiCorp, will acquire
the outstanding shares of the Company not owned by Holdings for $30 per
share in cash. In connection with the execution of the Merger
Agreement, the Company and PacifiCorp jointly disseminated a press
release. The full text of the Merger Agreement, a related agreement
between the Company and PacifiCorp, and the press release are attached
hereto as Exhibits 2A, 2B and 99, respectively, and are incorporated
herein by reference.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND
EXHIBITS
(c) Exhibits
2A Agreement and Plan of Merger, dated as of March 9,
1995, by and among Pacific Telecom, Inc., PacifiCorp
Holdings, Inc. and PXYZ Corporation.
2B Agreement, dated as of March 9, 1995, by and between
PacifiCorp and Pacific Telecom, Inc.
99 Form of Press Release dated March 9, 1995.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act
of 1934, the Registrant has duly caused this report to be signed on its
behalf by the undersigned hereunto duly authorized.
PACIFIC TELECOM, INC.
By: /s/James H. Huesgen
________________________________________
James H. Huesgen
Executive Vice President
and Chief Financial Officer
Dated: March 9, 1995
<PAGE>
Exhibit 2A
AGREEMENT
AND
PLAN OF MERGER
<PAGE>
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TABLE OF CONTENTS
<S> <C>
ARTICLE I THE MERGER . . . . . . . . . . . . . . . . . . . . . 2
1.1 Effect of Merger . . . . . . . . . . . . . . . . . . . . . . 3
1.2 Articles of Incorporation, etc. . . . . . . . . . . . . . . 3
1.2.1 Articles of Incorporation and Bylaws . . . . . . . . 3
1.2.2 Directors . . . . . . . . . . . . . . . . . . . . . . 3
1.2.3 Officers . . . . . . . . . . . . . . . . . . . . . . 3
1.3 Conversion and Cancellation of Shares . . . . . . . . . . . 4
1.3.1 PTI Common Stock Held by Holdings . . . . . . . . . . 4
1.3.2 PTI Common Stock Held by Minority Shareholders . . . 4
1.3.3 Merger Sub Common Stock . . . . . . . . . . . . . . . 4
1.3.4 Payment for Minority Stock . . . . . . . . . . . . . 5
1.3.5 Lost, Stolen or Destroyed Certificates . . . . . . . 6
1.3.6 No Further Rights or Transfers . . . . . . . . . . . 6
1.3.7 Dissenting Shareholders . . . . . . . . . . . . . . . 7
1.4 Closing . . . . . . . . . . . . . . . . . . . . . . . . . . 7
1.5 Subsequent Actions . . . . . . . . . . . . . . . . . . . . . 7
ARTICLE II REPRESENTATIONS AND WARRANTIES . . . . . . . . . . 8
2.1 Representations and Warranties of PTI. . . . . . . . . . . . 8
2.1.1 Organization and Good Standing. . . . . . . . . . . . 8
2.1.2 Capitalization. . . . . . . . . . . . . . . . . . . . 8
2.1.3 Corporate Authority; Authorization . . . . . . . . . . 9
2.1.4 Consents and Approvals . . . . . . . . . . . . . . . . 9
2.1.5 Proxy Statement and Schedule 13E-3 . . . . . . . . . . 10
2.1.6 Company SEC Reports and Financial Statements . . . . . 11
2.1.7 Absence of Material Adverse Change . . . . . . . . . . 12
2.1.8 Brokers and Finders. . . . . . . . . . . . . . . . . . 12
2.1.9 Fairness Opinions. . . . . . . . . . . . . . . . . . . 13
2.2 Representations and Warranties of Holdings and Merger Sub . . 13
2.2.1 Organization and Good Standing . . . . . . . . . . . . 13
2.2.2 Corporate Authority . . . . . . . . . . . . . . . . . 13
2.2.3 Proxy Statement and Schedule 13E-3 . . . . . . . . . . 14
2.2.4 Required Approvals . . . . . . . . . . . . . . . . . . 14
2.2.5 Prior Proposals and Offers; No Present Intent to Sell. 15
2.2.6 Financing . . . . . . . . . . . . . . . . . . . . . . 16
ARTICLE III COVENANTS . . . . . . . . . . . . . . . . . . . . . 16
3.1 Proxy Materials and Schedule 13E-3 . . . . . . . . . . . . . 16
3.2 Shareholder Approval . . . . . . . . . . . . . . . . . . . . 17
3.3 Acquisition Proposals. . . . . . . . . . . . . . . . . . . . 18
3.4 Dissenters' Rights . . . . . . . . . . . . . . . . . . . . . 18
3.5 Conduct of Business of PTI . . . . . . . . . . . . . . . . . 18
3.6 Access and Information . . . . . . . . . . . . . . . . . . . 20
3.7 Certain Filings, Consents and Arrangements . . . . . . . . . 20
3.7.1 Consents . . . . . . . . . . . . . . . . . . . . . . 20
3.7.2 Filings . . . . . . . . . . . . . . . . . . . . . . . 20
3.8 Indemnification and Insurance . . . . . . . . . . . . . . . 21
3.9 Dividend Policy . . . . . . . . . . . . . . . . . . . . . . 22
</TABLE>
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<TABLE>
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<S> <C>
3.10 Notification of Certain Matters . . . . . . . . . . . . . . 23
3.11 Fees and Expenses . . . . . . . . . . . . . . . . . . . . . 23
3.12 Election of Directors . . . . . . . . . . . . . . . . . . . 23
3.13 Employee Benefits . . . . . . . . . . . . . . . . . . . . . 23
3.14 Additional Agreements . . . . . . . . . . . . . . . . . . . 23
ARTICLE IV CONDITIONS . . . . . . . . . . . . . . . . . . . . 24
4.1 Conditions to the Obligations of The Parties . . . . . . . . 24
4.1.1 Shareholder Approval . . . . . . . . . . . . . . . . 24
4.1.2 No Injunction . . . . . . . . . . . . . . . . . . . 24
4.2 Conditions to Obligation of PTI . . . . . . . . . . . . . . 24
4.2.1 Representations, Warranties, and Covenants . . . . . 24
4.2.2 PacifiCorp Agreement. . . . . . . . . . . . . . . . . 25
4.2.3 No Injunction . . . . . . . . . . . . . . . . . . . . 25
4.2.4 Fairness Opinions . . . . . . . . . . . . . . . . . . 25
4.2.5 Consents and Approvals . . . . . . . . . . . . . . . 25
4.3 Conditions to Obligations of Holdings and Merger Sub . . . . 26
4.3.1 Representations, Warranties, and Covenants . . . . . 26
4.3.2 No Injunction . . . . . . . . . . . . . . . . . . . . 26
4.3.3 Material Adverse Change . . . . . . . . . . . . . . . 26
4.3.4 Consents and Approvals . . . . . . . . . . . . . . . 26
ARTICLE V TERMINATION . . . . . . . . . . . . . . . . . . . . 27
5.1 Termination . . . . . . . . . . . . . . . . . . . . . . . . 27
5.1.1 Mutual Consent . . . . . . . . . . . . . . . . . . . 27
5.1.2 Failure of Merger to Occur by Certain Date . . . . . 27
5.1.3 Actions Restraining the Merger . . . . . . . . . . 27
5.1.4 Failure of Shareholders to Approve . . . . . . . . . 28
5.1.5 By PTI . . . . . . . . . . . . . . . . . . . . . . . 28
5.1.6 By Holdings . . . . . . . . . . . . . . . . . . . . . 28
5.2 Effect of Termination . . . . . . . . . . . . . . . . . . . 28
ARTICLE VI MISCELLANEOUS AND GENERAL . . . . . . . . . . . . . 29
6.1 Survival of Representations, Warranties and Agreements . . . 29
6.2 Waiver and Amendment . . . . . . . . . . . . . . . . . . . . 29
6.3 Entire Agreement . . . . . . . . . . . . . . . . . . . . . . 29
6.4 Headings . . . . . . . . . . . . . . . . . . . . . . . . . . 30
6.5 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . 30
6.6 Parties in Interest; Assignment . . . . . . . . . . . . . . 30
6.7 Specific Performance . . . . . . . . . . . . . . . . . . . . 31
6.8 Public Statements . . . . . . . . . . . . . . . . . . . . . 31
6.9 Counterparts . . . . . . . . . . . . . . . . . . . . . . . . 31
6.10 Choice of Law . . . . . . . . . . . . . . . . . . . . . . . 31
</TABLE>
ii
<PAGE>
AGREEMENT AND
PLAN OF MERGER
AGREEMENT AND PLAN OF MERGER (the "Agreement") dated as of
March 9, 1995, by and among PACIFIC TELECOM, INC., a Washington
corporation ("PTI"), PACIFICORP HOLDINGS, INC., a Delaware corpora-
tion ("Holdings"), and PXYZ CORPORATION, a Washington corporation
("Merger Sub").
R E C I T A L S
A. Holdings, a direct wholly-owned subsidiary of
PacifiCorp, an Oregon corporation ("PacifiCorp"), owns 34,325,181
shares, or approximately 86.6 percent, of the issued and outstanding
common stock, no par value, of PTI ("PTI Common Stock").
B. Merger Sub is a direct, wholly-owned subsidiary of Hold-
ings, formed solely for the purposes of the transactions contemplat-
ed by this Agreement.
C. The Board of Directors of each of Holdings, Merger Sub
and PTI believes that it is in the best interest of each respective
corporation and their respective shareholders to consummate the
merger of Merger Sub with and into PTI pursuant to the applicable
provisions of the Washington Business Corporation Act (the "WBCA")
and in accordance with the terms and subject to the conditions of
this Agreement (the "Merger").
D. Based upon the unanimous recommendation of the special
committee of the Board of Directors of PTI (the "Special Commit-
tee"), the Board of Directors of PTI has approved the Merger, with
PTI to be the surviving corporation and a wholly-owned subsidiary of
Holdings following the Merger, upon the terms and subject to the
conditions set forth herein and has recommended approval of this
Agreement and the Merger by the shareholders of PTI.
<PAGE>
E. The Board of Directors of each of Holdings and Merger
Sub have approved this Agreement and the Merger, upon the terms and
conditions set forth herein.
F. Contemporaneous with the execution of this Agreement,
PacifiCorp is entering into an agreement in the form attached hereto
as Exhibit A (the "PacifiCorp Agreement") with PTI pursuant to which
PacifiCorp is assuming certain obligations in connection with the
transactions contemplated hereby.
AGREEMENT:
_________
NOW, THEREFORE, in consideration of the mutual representa-
tions, warranties, covenants, agreements and conditions contained
herein, the parties agree as follows:
ARTICLE I
THE MERGER
Pursuant to the WBCA, and subject to and in accordance with the
terms and conditions of this Agreement, Merger Sub shall, at the
Effective Time (as hereinafter defined), be merged with and into
PTI, the outstanding shares of the capital stock of PTI held by
Holdings shall be cancelled, the outstanding shares of capital stock
of PTI held by shareholders other than Holdings (the "Minority
Shareholders") shall be converted into the right to receive the
Merger Consideration (as hereinafter defined), the outstanding
shares of the capital stock of Merger Sub shall be converted into
shares of the capital stock of PTI, all as described in Section 1.3,
and PTI shall execute Articles of Merger, to be filed with the
Secretary of State of the State of Washington on the Closing Date
(as hereinafter defined). The Merger shall take effect (the "Effec-
tive Time") when, subject to and in accordance with the terms and
conditions of this Agreement, Articles of Merger and such other
documents as may be required by the applicable provisions of the
WBCA, in such form as are required by and executed in accor-
dance with the WBCA, are duly filed with the Secretary of
State of the State of Washington. Such filings shall be made
2
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as soon as practicable following the satisfaction or waiver of the
conditions set forth in Article IV of this Agreement.
1.1 Effect of Merger. At the Effective Time, Merger
________________
Sub shall be merged with and into PTI in the manner and with the
effect provided by the WBCA, the separate corporate existence of
Merger Sub shall cease and thereupon Merger Sub and PTI shall be a
single corporation (the "Surviving Corporation"). The outstanding
shares of capital stock of PTI held by Holdings shall be cancelled,
the outstanding shares of capital stock of PTI held by the Minority
Shareholders shall be converted into the right to receive the Merger
Consideration, and the outstanding shares of capital stock of Merger
Sub shall be converted into a like number of shares of the capital
stock of PTI, all on the basis, terms and conditions described in
Section 1.3.
1.2 Articles of Incorporation, etc. In addition to
______________________________
the effects identified in Section 1.1:
1.2.1 Articles of Incorporation and Bylaws. The
____________________________________
Articles of Incorporation and Bylaws of PTI as in effect at the
Effective Time shall be the Articles of Incorporation and Bylaws of
the Surviving Corporation;
1.2.2 Directors. The directors of PTI at the
_________
Effective Time shall be the directors of the Surviving Corporation,
until their respective successors shall be duly elected or appointed
and qualified; and
1.2.3 Officers. The officers of PTI at the
________
Effective Time shall be the initial officers of the Surviving
Corporation and will hold office from the Effective Time until their
respective successors are duly elected and qualified.
3
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1.3 Conversion and Cancellation of Shares. The manner
_____________________________________
and basis of cancelling the shares of PTI or converting them into
the right to receive cash and the manner and basis of converting the
shares of Merger Sub into shares of PTI shall be as follows:
1.3.1 PTI Common Stock Held by Holdings. Each of
_________________________________
the 34,325,181 shares of PTI Common Stock held by Holdings ("Hold-
ings Stock"), outstanding immediately before the Effective Time,
shall by virtue of the Merger and without any action on the part of
Holdings as the holder thereof, be cancelled without payment of any
consideration therefor and shall cease to exist.
1.3.2 PTI Common Stock Held by Minority Shareholders.
______________________________________________
Each share of PTI Common Stock held by the Minority Shareholders
(including, without limitation, PTI Common Stock held in escrow for
the benefit of participants in PTI's Non-Employee Director Stock
Compensation Plan and PTI's Long-Term Incentive Plan 1994 Restate-
ment) ("Minority Stock"), outstanding immediately before the Effec-
tive Time (other than shares with respect to which the holder
thereof has properly perfected dissenters' rights in accordance with
the WBCA), shall by virtue of the Merger and without any action on
the part of the holder thereof, be converted into the right to the
Merger Consideration in accordance with Section 1.3.4.
1.3.3 Merger Sub Common Stock. Each of the 100 shares
_______________________
of Merger Sub Common Stock, ("Merger Sub Stock"), issued and out-
standing immediately before the Effective Time shall, by virtue of
the Merger and without any action on the part of the holder thereof,
be converted into and become one share of PTI Common Stock.
4
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1.3.4 Payment for Minority Stock. Prior to the
__________________________
Effective Time, Holdings shall designate a bank or trust company
with capital, surplus and undivided profits of at least $100 million
to act as the payment agent (the "Payment Agent") in connection with
the Merger. At or prior to the Effective Time, Holdings shall take
all steps necessary to enable and cause the Payment Agent to receive
the funds (the "Fund") necessary to make the payments of Merger
Consideration provided for by this Agreement. Out of the Fund, the
Payment Agent shall, pursuant to irrevocable instructions, make the
payments of Merger Consideration provided for by this Agreement.
The Fund shall not be used for any other purpose. The Payment Agent
may invest portions of the Fund, as directed by Holdings (so long as
such instructions do not impair the Payment Agent's ability to make
the payments of Merger Consideration provided for by this Agreement
or otherwise impair the rights of holders of Minority Stock). Any
net earnings resulting from, or interest or income produced by, such
investments shall be paid to the Surviving Corporation as and when
requested by Holdings. Holdings shall replace any monies lost
through any investment pursuant to this Section 1.3.4. Promptly
after the Effective Time, Holdings shall cause the Payment Agent to
mail to each record holder of Minority Stock as of immediately prior
to the Effective Time a form of letter of transmittal and instruc-
tions for use in effecting the surrender of certificates represent-
ing Minority Stock for payment. After the Effective Time, each
holder of shares of Minority Stock outstanding immediately prior to
the Effective Time shall, upon surrender for cancellation of a
certificate or certificates representing such shares to the Payment
Agent, together with such letter of transmittal duly executed and
completed in accordance with the instructions thereto, be entitled
to receive an amount equal to $30.00 in cash for each share of
Minority Stock converted pursuant to the provisions of Section 1.3.2
(the "Merger Consideration"). Subject to full compliance with this
Agreement, any cash provided to the Payment Agent pursuant to this
5
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Section 1.3.4 and not exchanged for certificates representing
Minority Stock within 180 days after the Effective Time will be
returned by the Payment Agent to the Surviving Corporation, which
thereafter shall act as the payment agent. Notwithstanding the
foregoing, neither the Payment Agent nor any party to this Agreement
shall be liable to any holder of Minority Stock for any Merger
Consideration delivered to a public official pursuant to any appli-
cable abandoned property, escheat or similar law.
1.3.5 Lost, Stolen or Destroyed Certificates. In the
______________________________________
event that any certificate representing Minority Stock shall have
been lost, stolen or destroyed, upon the making of an affidavit of
that fact by the person claiming such certificate to be lost, stolen
or destroyed, Holdings shall, or shall cause the Payment Agent to,
issue in exchange for such lost, stolen or destroyed certificate the
Merger Consideration deliverable in respect thereof as determined in
accordance with this Agreement; provided, however, that Holdings
________ _______
may, in its sole discretion and as a condition precedent to the
issuance thereof, require the owner of such lost, stolen or de-
stroyed certificate to give Holdings a bond in such sum as it may
reasonably direct as indemnity against any claim that may be made
against Holdings with respect to the certificate alleged to have
been lost, stolen or destroyed.
1.3.6 No Further Rights or Transfers. At and after the
______________________________
Effective Time, each holder of a certificate that represented
Minority Stock immediately prior to the Effective Time shall cease
to have any rights as a shareholder of PTI, except for the right to
surrender his or her certificate or certificates in exchange for the
Merger Consideration or to perfect his or her right to receive
payment for shares of Minority Stock pursuant to RCW 23B.13.010 et
__
seq. and Section 1.3.7 hereof (if such holder has validly exercised
___
and perfected the dissenters rights provided thereby), and there
shall be no transfers on the stock books of the Surviving
Corporation of any shares of PTI Common Stock which were
outstanding immediately prior to the Effective Time. If,
6
<PAGE>
after the Effective Time, certificates formerly representing Minori-
ty Stock are presented to the Surviving Corporation, they shall be
cancelled and exchanged solely for the Merger Consideration.
1.3.7 Dissenting Shareholders. Shares of Minority Stock
_______________________
outstanding immediately prior to the Effective Time and held by
shareholders who have validly perfected dissenter's rights in
accordance with RCW 23B.13.010 et seq. ("Dissenting Shares") shall
_______
not be converted as described in Section 1.3.2 but shall from and
after the Effective Time represent only the right to receive such
consideration as may be determined to be due in accordance with RCW
23B.13.010 et seq. Each holder of Dissenting Shares who becomes
______
entitled to payment for his Dissenting Shares in accordance with RCW
23B.13.010 et seq. shall receive payment therefor from the Surviving
_______
Corporation after the Effective Time (but only after the amount
thereof shall have been agreed upon or finally determined pursuant
to RCW 23B.13.010 et seq.). Notwithstanding the foregoing, if any
_______
holder of Dissenting Shares shall fail to perfect, effectively with-
draw or otherwise lose such rights either before or after the
Effective Time, such holder's Dissenting Shares shall be converted
into the right to receive the Merger Consideration in accordance
with the provisions of Section 1.3.2.
1.4 Closing. The closing of the Merger (the "Closing") shall
_______
take place at the offices of Stoel Rives Boley Jones & Grey, 900 SW
Fifth Avenue, Suite 2300, Portland, Oregon 97204, at 10:00 a.m. on
the date when the last of the conditions set forth in Article IV
hereof (other than conditions that by their terms are to occur at
Closing) shall have been fulfilled or waived or on such other date
as PTI and Holdings may agree (the "Closing Date").
1.5 Subsequent Actions. If, at any time after the Effective
__________________
Time, the Surviving Corporation shall reasonably determine that any
deeds, bills of sale, assignments, assurances, or any other actions
or things are necessary or desirable to vest, perfect, or confirm of
7
<PAGE>
record or otherwise in the Surviving Corporation its right, title,
or interest in, to, or under any of the rights, properties, or
assets of, PTI or Merger Sub acquired or to be acquired by the
Surviving Corporation as a result of, or in connection with, the
Merger or otherwise to carry out this Agreement, the officers and
directors of the Surviving Corporation shall be authorized to
execute and deliver, in the name and on behalf of PTI or Merger Sub,
or otherwise, all such deeds, bills of sale, assignments, and
assurances, and to take and do, in the name and on behalf of PTI or
Merger Sub or otherwise, all such other actions and things as may be
necessary or desirable to vest, perfect, or confirm any and all
right, title, and interest in, to, and under such rights, proper-
ties, or assets in the Surviving Corporation or otherwise to carry
out this Agreement.
ARTICLE II
REPRESENTATIONS AND WARRANTIES
2.1 Representations and Warranties of PTI. PTI hereby
_____________________________________
represents and warrants to Holdings and Merger Sub that:
2.1.1 Organization and Good Standing. Each of PTI and
______________________________
its subsidiaries is a corporation duly organized, validly existing
and in good standing under the laws of the jurisdiction of its
incorporation and is duly qualified in good standing as a foreign
corporation in each jurisdiction where the properties owned, leased
or operated, or the business conducted, by it require such qualifi-
cation, except where the failure to be so qualified would not have a
material adverse effect on PTI and its subsidiaries taken as a
whole. Each of PTI and its subsidiaries has all requisite corporate
power and authority to own, lease and operate its properties and to
carry on its business as it is now being conducted.
2.1.2 Capitalization. The authorized capital stock of
______________
PTI consists of (i) 200,000,000 shares of common stock, no par
value, of which at February 28, 1995, there were 39,616,123 shares
8
<PAGE>
issued and outstanding (of which 34,325,181 were held by Holdings
and 5,290,942 constituted Minority Stock) and (ii) 152,000 shares of
Cumulative Preferred Stock, $25.00 par value, of which at Febru-
ary 28, 1995, there were no shares outstanding. All issued and
outstanding shares of Common Stock are validly issued, fully paid,
nonassessable and free of preemptive rights.
2.1.3 Corporate Authority; Authorization. PTI has the
__________________________________
corporate power and authority to execute and deliver this Agreement
and to consummate the transactions contemplated hereby. The execu-
tion and delivery of this Agreement and the consummation of the
transactions contemplated hereby have been duly and validly autho-
rized and approved by the Board of Directors of PTI and no other
corporate proceedings on the part of PTI or any subsidiary of PTI
are necessary to authorize this Agreement and, except for the
approval of this Agreement by its shareholders and the filing of the
Articles of Merger pursuant to the WBCA, no other corporate proceed-
ings on the part of PTI are necessary to consummate the transactions
contemplated by this Agreement. This Agreement has been duly and
validly executed and delivered by PTI and constitutes a valid and
binding obligation of PTI enforceable against PTI in accordance with
its terms, except as enforcement may be affected by applicable
bankruptcy, insolvency, reorganization, moratorium, or similar laws
affecting the enforcement of creditors' rights generally and except
that the availability of the equitable remedies of specific perfor-
mance and injunctive relief are subject to the discretion of the
court before which any proceeding may be brought.
2.1.4 Consents and Approvals. Except for compliance
______________________
with applicable requirements of the Securities Exchange Act of 1934
(the "Exchange Act"), the securities laws of the various states,
shareholder approval of the Merger, the filing of the Articles of
Merger pursuant to the WBCA and any necessary consents from the
Federal Communications Commission and any state telecommunications
regulatory authorities, no filing with, and no permit,
9
<PAGE>
authorization, consent or approval of, any public body or authority
is necessary for the execution and delivery by PTI of this Agreement
or the consummation by PTI of the transactions contemplated by this
Agreement, excluding from the foregoing filings, permits, authoriza-
tions, consents or approvals that, either individually or in the
aggregate, would not have a material adverse effect on the business,
operations, financial condition or prospects of PTI and its subsid-
iaries taken as a whole. Neither the execution and delivery of this
Agreement nor the consummation of the transactions contemplated
hereby will (i) conflict with or result in any breach of any provi-
sion of the articles of incorporation or bylaws of PTI or any of its
subsidiaries, (ii) result in a violation or breach of, or constitute
(with or without due notice or lapse of time or both) a default (or
give rise to any right of termination, cancellation or acceleration)
under, any of the terms, conditions or provisions of any note, bond,
mortgage, indenture, license, permit, agreement or other instrument
or obligation to which PTI or any of its subsidiaries is a party or
by which any of them or any of their properties or assets may be
bound or (iii) violate any order, writ, injunction, decree, statute,
rule or regulation applicable to PTI, any of its subsidiaries or any
of their properties or assets, excluding from the foregoing clauses
(ii) and (iii) violations, breaches or defaults that, either indi-
vidually or in the aggregate, would not have a material adverse
effect on the business, operations, financial condition or prospects
of PTI and its subsidiaries taken as a whole.
2.1.5 Proxy Statement and Schedule 13E-3. None of the
__________________________________
information supplied or to be supplied by PTI and the Special
Committee for inclusion in the Rule 13e-3 Transaction Statement to
be filed pursuant to the Exchange Act in connection with the trans-
actions contemplated hereby (the "Schedule 13E-3") or the proxy
statement (the "Proxy Statement") to be filed pursuant to the
Exchange Act with respect to the meeting of shareholders (the
"Shareholder Meeting") called for the purpose of approving this
10
<PAGE>
Agreement and the transactions contemplated hereby, which, unless
Holdings otherwise approves in writing, will be the 1995 Annual
Meeting of Shareholders of PTI, and any amendments thereof or
supplements thereto, will, on the respective dates such materials
are filed with the Securities and Exchange Commission ("SEC"), at
the time of the mailing of the Proxy Statement or any amendment or
supplement thereto, to shareholders of PTI, at the time of the
Shareholder Meeting and at the Effective Time, contain any untrue
statement of a material fact or omit to state any material fact
required to be stated therein or necessary in order to make the
statements made therein, in light of the circumstances under which
they were made, not misleading. If at any time prior to the Effec-
tive Time any event with respect to PTI or its officers and direc-
tors should occur which is required to be described in an amendment
of, or a supplement to, the Proxy Statement or the Schedule 13E-3,
such event shall be so described, and such amendment or supplement
shall be promptly filed with the SEC and, as required by law,
disseminated to the shareholders of PTI. The Schedule 13E-3 will
comply (with respect to PTI) in all material respects, as to form,
with the applicable requirements of each of the Exchange Act and the
respective rules and regulations thereunder.
2.1.6 Company SEC Reports and Financial Statements. PTI
has heretofore furnished to Holdings complete copies of all regis-
tration statements, reports, and other required filings, including
all amendments thereto, filed since January 1, 1992 and on or before
the date hereof with the SEC (collectively, the "Company SEC Re-
ports"). Since January 1, 1992, PTI has timely filed all registra-
tion statements, reports and other filings required to be filed with
the SEC under the rules and regulations of the SEC. The Company SEC
Reports, including without limitation, any financial statements or
schedules included therein, when filed (a) did not contain any
untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements
made therein, in light of the circumstances in which they were made,
11
<PAGE>
not misleading and (b) complied in all material respects with the
applicable requirements of the Securities Act of 1933 (the "Securi-
ties Act") and the Exchange Act, as the case may be, and the appli-
cable rules and regulations thereunder. Other than as disclosed by
PTI in its filings with the SEC, each of the financial statements of
PTI (including any related notes and schedules) contained in the
Company SEC Reports comply as to form in all material respects with
applicable accounting requirements and with the published rules and
regulations of the SEC with respect thereto, have been prepared in
accordance with generally accepted accounting principles ("GAAP")
applied on a consistent basis throughout the periods indicated
(except as otherwise indicated in such financial statements or in
the notes thereto or, in the case of the unaudited interim state-
ments, as permitted by the requirements of Form 10-Q) and fairly
present in all material respects (subject, in the case of the
unaudited statements, to normal recurring audit adjustments) the
consolidated financial position of PTI and its consolidated subsid-
iaries as of the dates thereof and the consolidated results of their
operations and cash flows for the periods then ended in accordance
with GAAP.
2.1.7 Absence of Material Adverse Change. Since
__________________________________
September 30, 1994 and except as disclosed in the Company SEC
Reports or as otherwise disclosed to a responsible officer of
Holdings or PacifiCorp on or before the date hereof, here has not
been any material adverse change in the business, operations,
properties, assets, liabilities or condition (financial or other-
wise) of PTI and its subsidiaries taken as a whole or any declara-
tion of any dividend or other distribution with respect to PTI's
capital stock, other than regular quarterly dividends paid in
respect of PTI Common Stock.
2.1.8 Brokers and Finders. Neither PTI nor any officer,
___________________
director or employee of PTI has employed any broker, finder or
investment banker, or incurred any liability for any brokerage or
investment banking fees, commissions or finder's fees, in connection
with the transactions contemplated by this Agreement, except that
12
<PAGE>
Smith Barney, Inc. ("Smith Barney") has been engaged as the finan-
cial advisor to the Special Committee and CS First Boston Corpora-
tion ("CS First Boston") has been engaged to render an opinion as to
whether the Merger Consideration is fair, from a financial point of
view, to the Minority Shareholders, pursuant to engagement letters
that have been disclosed to Holdings.
2.1.9 Fairness Opinions. The Special Committee has
_________________
received the written opinion of each of Smith Barney and CS First
Boston (the "Fairness Opinions"), to the effect that, as of the
respective dates of such opinions, the Merger Consideration is fair,
from a financial point of view, to the Minority Shareholders.
2.2 Representations and Warranties of Holdings and Merger Sub.
_________________________________________________________
Holdings and Merger Sub hereby represent and warrant to PTI that:
2.2.1 Organization and Good Standing. Holdings and
______________________________
Merger Sub are corporations duly organized, validly existing and in
good standing under the laws of the States of Delaware and Washing-
ton, respectively. Each of Holdings and Merger Sub has all requi-
site corporate power and authority to own and operate its properties
and to carry on its business as now being conducted.
2.2.2 Corporate Authority. Each of Holdings and Merger
___________________
Sub has the corporate power and authority to execute and deliver
this Agreement and to consummate the transactions contemplated
hereby. The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby have been duly
and validly authorized and approved by the Board of Directors of
Holdings and Merger Sub and the sole shareholder of Merger Sub and
no other corporate proceedings on the part of Holdings or Merger Sub
are necessary to authorize this Agreement or the consummation of the
transactions contemplated hereby. This Agreement has been duly and
validly executed and delivered by each of Holdings and Merger Sub
and constitutes a valid and binding agreement of Holdings and Merger
Sub, enforceable against each of them in accordance with its terms,
13
<PAGE>
except as enforcement may be affected by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting the
enforcement of creditors' rights generally and except that the
availability of the equitable remedies of specific performance and
injunctive relief are subject to the discretion of the court before
which any proceeding may be brought.
2.2.3 Proxy Statement and Schedule 13E-3. None of the
__________________________________
information supplied or to be supplied by PacifiCorp, Holdings or
Merger Sub for inclusion in the Schedule 13E-3 or the Proxy State-
ment and any amendments thereof or supplements thereto will, on the
respective dates such materials are filed with the SEC, at the time
of the mailing of such Proxy Statement or any amendment or supple-
ment thereto to shareholders of PTI, at the time of the Shareholder
Meeting and at the Effective Time, contain any untrue statement of a
material fact or omit to state any material fact required to be
stated therein or necessary in order to make the statements made
therein, in light of the circumstances under which they were made,
not misleading. If at any time prior to the Effective Time any
event with respect to PacifiCorp, Holdings, Merger Sub or any of
their respective officers, directors or affiliates should occur
which is required to be described in an amendment of, or a supple-
ment to, the Proxy Statement or the Schedule 13E-3, such event shall
be so described, and such amendment or supplement shall be promptly
filed with the SEC and, as required by law, disseminated to the
shareholders of PTI. The Schedule 13E-3 will comply (with respect
to PacifiCorp, Holdings, Merger Sub and their respective officers,
directors and affiliates) in all material respects, as to form, with
the applicable requirements of each of the Exchange Act and the
respective rules and regulations thereunder.
2.2.4 Required Approvals. Except for compliance with
__________________
the applicable requirements of the Exchange Act, the securities laws
of the various states and the filing of the Articles of Merger
pursuant to the WBCA, no filing with, and no permit, authorization,
14
<PAGE>
consent or approval of, any public body is necessary for the execu-
tion and delivery by Holdings or Merger Sub of this Agreement or the
consummation by Holdings or Merger Sub of the transactions contem-
plated by this Agreement. Neither the execution and delivery of
this Agreement nor the consummation of the transactions contemplated
hereby will (i) conflict with or result in any breach of any provi-
sion of the articles or certificate of incorporation (as the case
may be) or bylaws of PacifiCorp, Holdings or Merger Sub, (ii) result
in a violation or breach of, or constitute (with or without due
notice or lapse of time or both) a default (or give rise to any
right of termination, cancellation or acceleration) under, any of
the terms, conditions or provisions of any note, bond, mortgage,
indenture, license, permit, agreement or other instrument or obliga-
tion to which PacifiCorp, Holdings or Merger Sub is a party or by
which any of them or any of their respective properties or assets
may be bound or (iii) violate any order, writ, injunction, decree,
statute, rule or regulation applicable to PacifiCorp, Holdings or
Merger Sub, or any of their respective properties or assets, exclud-
ing from the foregoing clauses (ii) and (iii) violations, breaches
or defaults that, either individually or in the aggregate, would not
have a material adverse effect on the business, operations, finan-
cial condition or prospects of such entity and its subsidiaries
taken as a whole.
2.2.5 Prior Proposals and Offers; No Present Intent to
________________________________________________
Sell. Since January 1, 1993, to the best knowledge of Holdings
____
after due inquiry, none of PacifiCorp, Holdings or Merger Sub has
received any "proposal" or offer to purchase, or solicited any
proposal or offer to purchase, any material portion of the stock or
assets of PTI, other than transactions disclosed in the Company SEC
Reports (including, without limitation, the sale of Alascom). For
purposes of this Section 2.2.5 a "proposal" may be either written or
oral, but must have included a proposed or suggested price or
possible range of prices and, if made on behalf of a corporation,
must have been made by a responsible officer or representative of
that corporation.
15
<PAGE>
Neither PacifiCorp nor Holdings has any current plan or intent to
sell or otherwise dispose of any material portion of the stock or
assets of PTI, other than transactions disclosed in the Company SEC
Reports (including, without limitation, the sale of Alascom). The
Schedule 13D of PacifiCorp filed in respect of Holdings' ownership
interest in PTI, as amended by the form of amendment attached hereto
as Exhibit B (the "13D Amendment"), will fully comply with all of
the requirements of such Schedule including, without limitation,
Item 4 thereof. The 13D Amendment will be filed promptly after the
execution of this Agreement.
2.2.6 Financing. Holdings has available to it the funds
_________
necessary to consummate the Merger and the other transactions
contemplated by this Agreement.
ARTICLE III
COVENANTS
3.1 Proxy Materials and Schedule 13E-3. As soon as
__________________________________
practicable after the date hereof, PTI will prepare and, subject to
prior approval by Holdings, file the Proxy Statement and accompany-
ing proxy materials in preliminary form, and PTI and PacifiCorp,
Holdings and Merger Sub will prepare and file the Schedule 13E-3
with the SEC pursuant to the Exchange Act. PTI will provide Hold-
ings and Merger Sub with a reasonable opportunity to review and
approve the Proxy Statement and any amendments or supplements
thereto prior to filing them with the SEC. Holdings and Merger Sub
will provide PTI with a reasonable opportunity to review and approve
the Schedule 13E-3 and any amendments thereto prior to filing with
the SEC. PTI will use its best efforts to, as soon as is practica-
ble, have the Proxy Statement cleared by the SEC. PTI, Holdings and
Merger Sub will use their respective best efforts to, as soon as is
practicable, have the Schedule 13E-3 cleared by the SEC. As soon as
is practicable, PTI will distribute to the shareholders of PTI and
file with the SEC the Proxy Statement and accompanying materials in
16
<PAGE>
definitive form and Holdings, Merger Sub and PTI will file with the
SEC the Schedule 13E-3, as amended. Each party to this Agreement
shall, and shall cause its respective officers, directors and
affiliates to, cooperate fully with each other in responding prompt-
ly to any comments of the SEC in respect of any of the filings made
by such persons with the SEC in connection with the transactions
contemplated by this Agreement.
3.2 Shareholder Approval. PTI will take all action necessary
____________________
in accordance with applicable law and its governing instruments to
call, give notice of, convene, and hold the Shareholder Meeting as
promptly as practicable to consider and vote upon the approvals of
this Agreement, the Merger and such other matters as are required or
contemplated by this Agreement. In order to facilitate the solici-
tation of Minority Shareholders at the Shareholder Meeting, PTI
shall retain a proxy solicitation firm of national reputation and
reasonably acceptable to Holdings to assist in the solicitation of
proxies and shall permit Holdings to participate in the solicitation
process. The Special Committee has unanimously recommended to the
Board of Directors of PTI that the Merger is fair to and in the best
interests of the Minority Shareholders. Based upon the recommenda-
tion of the Special Committee, the Board of Directors of PTI has
determined by a unanimous vote (except for possible abstention by
the director who also serves as a director of PacifiCorp) that this
Agreement is advisable and in the best interests of the Minority
Shareholders and recommends, and subject to their respective fidu-
ciary duties, (i) shall continue to recommend, to the Minority
Shareholders the adoption and approval of this Agreement and the
transactions contemplated hereby and (ii) shall use their respective
best efforts to obtain the necessary approvals by its shareholders
of this Agreement and the transactions contemplated hereby. Hold-
ings and Merger Sub have each determined that the transactions
contemplated by this Agreement are fair to the Minority Sharehold-
ers.
17
<PAGE>
3.3 Acquisition Proposals. PTI will not, directly or
_____________________
indirectly, through any officer, director, agent or otherwise,
solicit, initiate or encourage submission of proposals or offers
from any person (including any of its officers or employees) relat-
ing to any acquisition or purchase of all or a substantial portion
of the assets of, or any equity interest in, PTI or any of its
subsidiaries (other than sales of assets in the ordinary course of
business which, in the aggregate, do not involve a substantial
portion of the assets of PTI or any of its subsidiaries or sales
disclosed in the Company SEC Reports including, without limitation,
the sale of Alascom) or any business combination with PTI or any of
its subsidiaries, or, subject to fiduciary duties under applicable
law as advised by counsel, participate in any negotiations regard-
ing, or furnish to any other person any information with respect to,
or otherwise cooperate in any way with, or assist or participate in,
facilitate or encourage, any effort or attempt by any other person
to do or seek any of the foregoing. PTI represents and warrants
that, as of the date of this Agreement, no such negotiations or
activities are in process with respect to the foregoing. PTI shall
promptly notify Holdings if any such proposal or offer, or any
inquiry or contact with any person with respect thereto, is made.
3.4 Dissenters' Rights. PTI shall not settle or compromise
__________________
any claim for dissenters' rights in respect of the Merger without
the prior written consent of Holdings.
3.5 Conduct of Business of PTI. During the period from
__________________________
the date of this Agreement to the Effective Time, except as specifi-
cally contemplated by this Agreement or as previously disclosed in
the Company SEC Reports or otherwise approved in writing by Hold-
ings, PTI and its subsidiaries shall not:
(a) conduct their respective businesses except in the
ordinary course of business and consistent with past practice;
18
<PAGE>
(b) propose or adopt any amendments to its Articles of
Incorporation or Bylaws or make any change in the Board of Directors
of PTI except as may be required to comply with Section 3.12 of this
Agreement;
(c) issue, sell or repurchase, or authorize or propose
the issuance, sale or repurchase of any shares of its capital stock
or any other securities or issue any securities convertible into or
exchangeable for, or options, warrants to purchase, rights to
subscribe for, calls or commitments of any character whatsoever
relating to, or enter into any agreement, understanding or arrange-
ment with respect to the issuance of, any of its shares of capital
stock or any other securities (including securities of others),
other than pursuant to the PacifiCorp K Plus and Employee Stock
Ownership Plan, or enter into any agreement, understanding or
arrangement with respect to the purchase or voting of shares of its
capital stock, or adjust, split, combine or reclassify any of its
securities, or make any other changes in its capital structure;
(d) declare, set aside, pay or make any dividend or other
distribution or payment (whether in cash, stock or property) with
respect to, or purchase or redeem, any shares of the capital stock
of PTI, except for regular quarterly cash dividends of no more than
$.33 per share;
(e) take any action with respect to the grant of any
severance or termination pay (otherwise than pursuant to policies or
agreements of PTI or any of its subsidiaries in effect on the date
hereof) or with respect to any increase of benefits payable under
its severance or termination pay policies in effect on the date
hereof; or
(f) except for salary increases or other employee benefit
arrangements made in the ordinary course of business, adopt or amend
any bonus, profit sharing, compensation, pension, retirement,
deferred compensation, severance, employment or other employee
benefit plan, agreement, trust, fund or arrangement for the benefit
or welfare of any employee.
19
<PAGE>
3.6 Access and Information. PTI shall and shall cause
______________________
its subsidiaries to give to Holdings and Merger Sub and their
respective representatives full access to all the premises and books
and records of PTI and its subsidiaries and shall cause its officers
and officers of its subsidiaries and their independent auditors to
furnish to such persons such financial and operating data and other
information, including access to the working papers of its indepen-
dent auditors, with respect to its business and properties as
Holdings shall from time to time reasonably request. No investiga-
tion pursuant to this Section 3.6 shall affect or be deemed to
modify any representations or warranties made in this Agreement or
the conditions to the obligations of the parties to consummate the
Merger.
3.7 Certain Filings, Consents and Arrangements.
__________________________________________
3.7.1 Consents. Holdings, Merger Sub and PTI shall
________
use their respective best efforts to obtain any necessary consents,
permits, authorizations, approvals and waivers to permit the consum-
mation of the transactions contemplated by this Agreement, provided
that PTI shall not, without the consent of Holdings (which consent
shall not be unreasonably withheld), agree to any amendment to any
material instrument or agreement to which it is a party.
3.7.2 Filings. Holdings, Merger Sub and PTI shall
_______
cooperate with one another (i) in promptly determining whether any
filings are required to be made or consents, approvals, permits or
authorizations are required to be obtained under any federal, state
or foreign law or regulation or any consents, approvals or waivers
are required to be obtained from other parties to loan agreements or
other agreements or instruments material to PTI's business in
connection with the consummation of the Merger and (ii) in promptly
making any such filings, furnishing information required in connec-
tion therewith and seeking timely to obtain any such consents,
permits, authorizations, approvals or waivers.
20
<PAGE>
3.8 Indemnification and Insurance.
_____________________________
(a) From and after the Effective Time, the Surviving
Corporation shall maintain, and Holdings agrees to cause the Surviv-
ing Corporation to maintain for a period of at least six years from
the Effective Time for the benefit of PTI's current directors and
officers, (i) director and officer liability insurance providing at
least the same amounts and coverage with respect to PTI's current
directors and officers as the current policies maintained by or on
behalf of PTI, and containing terms and conditions which are no less
advantageous with respect to matters existing or occurring on or
prior to the Effective Time (or, with respect to matters arising
from or in connection with Section 1.5 hereof, subsequent to the
Effective Time), and in the event any claim is made against present
directors of PTI that is covered, in whole or in part, or potential-
ly so covered by insurance, the Surviving Corporation and Holdings
shall do nothing that would forfeit, jeopardize, restrict or limit
the insurance coverage available for that claim until the final
disposition of that claim; provided, however, that if the cost of
________ _______
maintaining such insurance exceeds the current cost related to
providing such insurance (the "Current Cost") by more than twice the
Current Cost, then the Surviving Corporation shall maintain and
Holdings agrees to cause the Surviving Corporation to maintain such
director and officer liability insurance with the maximum amount of
coverage obtainable at twice such Current Cost, and (ii) all rights
to indemnification now existing in favor of the present directors
and officers of PTI and its respective subsidiaries as provided in
their respective articles of incorporation or bylaws or otherwise in
effect on the date hereof (other than pursuant to this Agreement)
shall survive the Merger for a period of six years; provided,
________
however, that all such rights to indemnification with respect to any
_______
claim asserted, made or originated prior to the expiration of such
six-year period shall survive until the final disposition of such
Claim (as hereinafter defined), and that during such period, the
Articles of Incorporation and Bylaws of the Surviving Corporation
21
<PAGE>
shall not be amended to reduce or limit the rights of indemnity of
the present directors and officers of PTI, or the ability of the
Surviving Corporation to indemnify them, nor to hinder, delay or
make more difficult the exercise of such rights of indemnity or the
ability to indemnify.
(b) Without limiting the foregoing, in any case in which
approval by the Surviving Corporation is required to effectuate any
indemnification under this Section 3.8, Holdings shall cause the
Surviving Corporation to direct, at the election of the director of
PTI seeking indemnification hereunder, that the determination of any
such approval shall be made by independent counsel acceptable to
Holdings selected by such director of PTI seeking indemnification
hereunder.
(c) This Section 3.8 shall survive the consummation of
the Merger. The provisions of this Section 3.8 are intended to be
for the benefit of, and shall be enforceable by the present direc-
tors or officers of PTI, as the case may be. The rights provided
under this Section 3.8 shall be in addition to, and not in lieu of,
any rights to indemnity which any party may have under the Articles
of Incorporation or Bylaws of PTI or the Surviving Corporation or
any other agreements.
(d) An indemnified party under this Section 3.8 shall be
free to determine, in such party's sole discretion, which of the
sources of indemnification or insurance available hereunder that
such party desires to pursue without in any manner waiving any
rights against other sources not initially pursued. In addition,
this Section 3.8 is not intended to release or limit any insurer
from the obligations undertaken by it in any policy of insurance.
3.9 Dividend Policy. During the period from the date of this
_______________
Agreement to the Effective Time, Holdings shall not take any action
to cause PTI to make any dividend or other distribution or payment
to Holdings with respect to Holdings Stock otherwise than in accor-
dance with PTI's existing dividend policies.
22
<PAGE>
3.10 Notification of Certain Matters. Each of PTI and
_______________________________
Holdings shall give prompt notice to the other of (i) any claims,
actions, proceedings or investigations commenced or, to the best of
its knowledge, threatened, involving or affecting the notifying
party or any of its property or assets, that relate to the Merger,
(ii) the occurrence, or failure to occur, of any event that would be
likely to cause any representation or warranty of the notifying
party contained in this Agreement to be untrue or inaccurate in any
material respect, and (iii) any material failure of the notifying
party or of any officer, director, employee or agent thereof, to
comply with or satisfy any covenant, condition or agreement to be
complied with or satisfied by it hereunder. No such notification
shall affect the representations or warranties of the parties or the
conditions to the obligations of the parties hereunder.
3.11 Fees and Expenses. All costs and expenses incurred
_________________
in connection with this Agreement and the transactions contemplated
hereby shall be paid by the party incurring such expenses (includ-
ing, in the case of PTI, the costs of printing and mailing the Proxy
Statement), whether or not the Merger is consummated.
3.12 Election of Directors. PTI agrees to take all
_____________________
actions requested by Holdings to cause to be elected to PTI's Board
of Directors at the Shareholder Meeting such additional directors as
may be designated by Holdings.
3.13 Employee Benefits. Holdings agrees to honor, from
_________________
and after the Effective Time, in accordance with its terms as in
effect on the date of this Agreement, the Pacific Telecom, Inc.
Executive Officer Severance Plan effective January 1, 1994.
3.14 Additional Agreements. Subject to the terms and
_____________________
conditions hereof, each party shall use its best efforts promptly to
take, or cause to be taken, all actions and promptly to do, or cause
to be done, all things necessary, proper or advisable under applica-
ble laws and regulations to consummate and make effective the
transactions contemplated by this Agreement.
23
<PAGE>
ARTICLE IV
CONDITIONS
4.1 Conditions to the Obligations of The Parties. The
____________________________________________
respective obligations of PTI, Holdings, and Merger Sub to consum-
mate the transactions contemplated by this Agreement are subject to
the satisfaction or waiver at or before the Closing of each of the
following conditions:
4.1.1 Shareholder Approval. This Agreement and the
____________________
Merger shall have been duly adopted and approved (A) by the affirma-
tive vote of the holders of at least a majority of the Minority
Stock and (B) by the requisite vote of the shareholders of PTI in
accordance with applicable law and its Articles of Incorporation and
Bylaws.
4.1.2 No Injunction. The consummation of the Merger
_____________
shall not be precluded by any order or injunction of a court of
competent jurisdiction (each party agreeing to use its best efforts
to have any such order reversed or injunction lifted), and there
shall not have been any action taken or any statute, rule or regula-
tion enacted, promulgated or deemed applicable to the Merger by any
government or governmental or other regulatory agency, domestic or
foreign, that makes consummation of the Merger illegal.
4.2 Conditions to Obligation of PTI. The obligation of PTI to
_______________________________
consummate the transactions contemplated by this Agreement is
subject to the satisfaction or waiver at or before the Closing of
the following additional conditions:
4.2.1 Representations, Warranties, and Covenants. The
__________________________________________
representations and warranties of Holdings and Merger Sub, includ-
ing, without limitation, those relating to PacifiCorp, contained in
this Agreement shall be correct in all material respects (a) at the
date of this Agreement, and (b) on and as of the Closing Date with
the same effect as though made on and as of such date, Holdings and
Merger Sub shall have performed in all material respects all of
24
<PAGE>
their respective covenants and obligations hereunder theretofore to
be performed, and PTI shall have received at the Closing certifi-
cates to that effect, dated the Closing Date, and executed on behalf
of Holdings by an executive officer of Holdings and on behalf of
Merger Sub by an executive officer of Merger Sub.
4.2.2 PacifiCorp Agreement. PacifiCorp shall have
____________________
entered into the PacifiCorp Agreement, the representations and
warranties of PacifiCorp contained in the PacifiCorp Agreement shall
be correct in all material respects (a) at the date of the PacifiCo-
rp Agreement and (b) on and as of the Closing Date with the same
effect as though made on and as of such date, and PacifiCorp shall
have performed in all material respects all of its covenants and
obligations under the PacifiCorp Agreement theretofore to be per-
formed and PTI shall have received at the Closing a certificate to
that effect, dated the Closing Date, and executed on behalf of
PacifiCorp by an executive officer of PacifiCorp.
4.2.3 No Injunction. No governmental action or
_____________
proceeding shall have been commenced that (a) in the opinion of the
Special Committee's counsel is more likely than not to be successful
and (b) seeks an injunction, a restraining order or any other order
seeking to prohibit, restrain, invalidate or set aside the consumma-
tion of the Merger.
4.2.4 Fairness Opinions. Neither of the Fairness
_________________
Opinions shall have been modified withdrawn or revoked as of the
time of the mailing of the Proxy Statement to the shareholders of
PTI.
4.2.5 Consents and Approvals. All consents, approvals,
______________________
permits and authorizations required to be obtained from governmental
and regulatory authorities in connection with the execution and
delivery of this Agreement and the consummation of the transactions
contemplated hereby by PTI shall have been obtained, except where
the failure to obtain such consents, approvals, permits and authori-
zations would not have a material adverse effect on the business,
25
<PAGE>
operations, financial condition or prospects of PTI and its subsid-
iaries, taken as a whole.
4.3 Conditions to Obligations of Holdings and Merger Sub. The
____________________________________________________
obligations of Holdings and Merger Sub to consummate the trans-
actions contemplated by this Agreement are subject to the satisfac-
tion or waiver at or before the Closing of the following additional
conditions:
4.3.1 Representations, Warranties, and Covenants. The
__________________________________________
representations and warranties of PTI contained in this Agreement
shall be correct in all material respects (a) at the date of this
Agreement, and (b) as of the Closing with the same effect as though
made on and as of such date, except for changes specifically contem-
plated by this Agreement, and PTI shall have performed in all
material respects all of its respective covenants and obligations
hereunder theretofore to be performed, and Holdings and Merger Sub
shall have received at the Closing certificates to that effect,
dated the Closing Date, and executed on behalf of PTI by an execu-
tive officer of PTI.
4.3.2 No Injunction. No governmental action or
_____________
proceeding shall have been commenced that (a) in the opinion of
Holding's counsel is more likely than not to be successful, and (b)
seeks an injunction, a restraining order or any other order seeking
to prohibit, restrain, invalidate or set aside consummation of the
Merger.
4.3.3 Material Adverse Change. Except as disclosed in
_______________________
the Company SEC Reports or as otherwise disclosed to a responsible
officer of Holdings or PacifiCorp on or before the date hereof,
since September 30, 1994, there shall not have been any change or
event that has resulted in, or may result in, any material adverse
change in the business, operations, properties, assets, liabilities
or condition (financial or otherwise) of PTI and its subsidiaries,
taken as a whole.
4.3.4 Consents and Approvals. All consents, approvals,
______________________
permits and authorizations required to be obtained from governmental
and regulatory authorities in connection with the execution and
delivery of this Agreement and the consummation of the transactions
26
<PAGE>
contemplated hereby by Holdings shall have been obtained, except
where the failure to obtain such consents, approvals, permits and
authorizations would not have a material adverse effect on the
business, operations, financial condition or prospects of Holdings
and its subsidiaries, taken as a whole.
ARTICLE V
TERMINATION
5.1 Termination. This Agreement may be terminated and the
___________
Merger may be abandoned at any time prior to the Effective Time,
whether before or after the Shareholder Meeting:
5.1.1 Mutual Consent. By the mutual consent of the
______________
Boards of Directors of Holdings and PTI;
5.1.2 Failure of Merger to Occur by Certain Date. By
__________________________________________
either PTI or Holdings if the Effective Time shall not have occurred
on or before September 30, 1995, which date may be extended by the
mutual consent of the Boards of Directors of Holdings and PTI;
provided, however, that the right to terminate this Agreement under
________ _______
this Section 5.1.2 shall not be available to a party whose failure
(or whose subsidiary's or parent corporation's failure) to fulfill
any obligation under this Agreement has been a significant cause of,
or in any significant respect resulted in, the failure of the
Effective Time to occur on or before September 30, 1995 or, in the
event of an extension by the mutual agreement of Holdings and PTI,
by such later date;
5.1.3 Actions Restraining the Merger. By either
______________________________
Holdings or PTI if any court of competent jurisdiction in the United
States or other United States governmental body shall have issued an
order, decree or ruling or taken any other action restraining,
enjoining or otherwise prohibiting the Merger and such order,
decree, ruling or other action shall have become final and nonap-
pealable;
27
<PAGE>
5.1.4 Failure of Shareholders to Approve. By either
__________________________________
Holdings or PTI if the shareholders of PTI fail to duly adopt and
approve this Agreement and the Merger as contemplated by Section
4.1.1;
5.1.5 By PTI. By PTI if (A) there is a material breach
______
of any of the representations and warranties of PacifiCorp, Holdings
or Merger Sub or (B) PacifiCorp, Holdings or Merger Sub fail to
comply in any material respect with any of their respective cove-
nants or agreements, in each case as contained herein or in the
PacifiCorp Agreement; or
5.1.6 By Holdings. By Holdings or Merger Sub if (A) the
___________
Special Committee or the Board of Directors upon the recommendation
of the Special Committee shall have withdrawn or modified in any
manner adverse to Holdings or Merger Sub its approval or recom-
mendation of this Agreement or the Merger, or (B) there is a materi-
al breach of any of the representations and warranties of PTI or (C)
PTI fails to comply in any material respect with any of its cove-
nants or agreements contained herein.
5.2 Effect of Termination. Except as set forth below in this
_____________________
Section 5.2 and as provided in Section 6.1, upon the termination of
this Agreement pursuant to Section 5.1, this Agreement shall forth-
with become null and void and no party to this Agreement shall have
any liability or further obligation to the other party by reason of
this Agreement, other than for damages to the extent arising from a
prior breach of this Agreement.
28
<PAGE>
ARTICLE VI
MISCELLANEOUS AND GENERAL
6.1 Survival of Representations, Warranties and Agreements.
______________________________________________________
The representations and warranties in this Agreement shall terminate
at the Effective Time or upon the termination of this Agreement
pursuant to Section 5.1, as the case may be. The covenants and
agreements contained in this Agreement shall survive the Effective
Time and shall continue until they terminate in accordance with
their terms. The covenants and agreements contained in Sections
3.11, 5.2 and this Section 6.1 shall survive termination of this
Agreement in accordance with their terms.
6.2 Waiver and Amendment. Any provision of this Agreement may
____________________
be waived at any time by the party that is, or whose shareholders
are, entitled to the benefits thereof. Except for the provisions
hereof relating to indemnification and insurance as set forth in
Section 3.8, this Agreement may be amended or supplemented at any
time, except that after approval hereof by the shareholders of PTI,
no amendment shall be made which decreases the Merger Consideration,
changes the form of the Merger Consideration or that in any other
way materially adversely affects the rights of the Minority Share-
holders (other than a termination of this Agreement) without the
further approval of the Minority Shareholders. No such waiver,
amendment or supplement shall be effective unless in writing and
signed by the party or parties intended to be bound thereby.
6.3 Entire Agreement. This Agreement (a) contains the
________________
entire agreement among Holdings, Merger Sub and PTI with respect to
the Merger and the other transactions contemplated hereby, and
supersedes all prior agreements among the parties with respect to
such matters, and (b) is not intended to confer upon any other
persons any rights or remedies hereunder, except as specifically
provided for herein.
29
<PAGE>
6.4 Headings. The descriptive headings contained herein are
________
for convenience and reference only and shall not affect in any way
the meaning or interpretation of this Agreement.
6.5 Notices. All notices or other communications hereunder
_______
shall be in writing and shall be given (and shall be deemed to have
been duly given upon receipt) by delivery in person, by cable,
telegram, telex or other standard form of telecommunications, or by
registered or certified mail, postage prepaid, return receipt
requested addressed as follows:
If to PTI: With copies to:
Pacific Telecom, Inc. Latham & Watkins
Attention: Special Committee of the Attention: John J. Huber
Board of Directors 1001 Pennsylvania Ave., NW
c/o James H. Huesgen Suite 1300
805 Broadway Washington, D.C. 20004-2505
Vancouver, WA 98660
If to Holdings or Merger Sub: With a copy to:
PacifiCorp Holdings, Inc. Stoel Rives Boley Jones & Grey
Attention: Richard T. O'Brien Attention: Henry H. Hewitt
700 NE Multnomah 900 SW Fifth Avenue
Suite 1600 Suite 2300
Portland, Oregon 97232 Portland, Oregon 97204
or to such other address as any party may have furnished to the
other parties in writing in accordance herewith.
6.6 Parties in Interest; Assignment. This Agreement is
_______________________________
binding upon and is solely for the benefit of the parties and their
respective successors, legal representatives and assigns except that
Sections 3.8 and 3.13 shall be for the express benefit of the
persons in the categories referred to therein. Holdings shall have
the right to assign to one or more direct or indirect wholly owned
subsidiaries of Holdings any and all rights and obligations of
Merger Sub under this Agreement, including without limitation, the
right to substitute in Merger Sub's place such a subsidiary as one
30
<PAGE>
of the constituent corporations in the Merger (if such subsidiary
assumes all of the obligations of Merger Sub in connection with the
Merger). If Holdings exercises its right to so restructure the
transaction, PTI shall promptly enter into appropriate agreements to
reflect such restructuring. In any such event the amounts to be
paid to holders of Minority Stock shall not be reduced, nor shall
there be any material delay of the Effective Time.
6.7 Specific Performance. The parties agree that irreparable
____________________
damage would occur if any of the provisions of this Agreement are
not performed in accordance with their specific terms or are other-
wise breached. It is agreed that the parties shall be entitled to
an injunction or injunctions to prevent breaches of this Agreement
and to enforce specifically the terms and provisions hereof in any
court of the United States or any state having jurisdiction, in
addition to any other remedy to which any party is entitled at law
or in equity.
6.8 Public Statements. The parties agree to consult with each
_________________
other prior to issuing any public announcement or statement with
respect to the Merger, if practicable. As soon as is practicable
following execution of this Agreement, the parties will issue a
joint press release announcing the execution of this Agreement,
which press release will be in the form of Exhibit C hereto.
6.9 Counterparts. For the convenience of the parties hereto,
____________
this Agreement may be executed in any number of counterparts, each
such counterpart being deemed to be an original instrument, and all
such counterparts shall together constitute the same agreement.
6.10 Choice of Law. This Agreement shall be governed by and
_____________
construed in accordance with the laws of the State of Washington
regardless of the laws that might otherwise govern under applicable
principles of conflicts of law.
(Signature pages to follow)
31
<PAGE>
IN WITNESS WHEREOF, this Agreement has been duly executed
and delivered by the duly authorized officers of the parties hereto
as of the date first hereinabove written.
PACIFIC TELECOM, INC.
By CHARLES E. ROBINSON
__________________________________
Title: Chief Executive Officer
PACIFICORP HOLDINGS, INC.
By RICHARD T. O'BRIEN
__________________________________
Title: Senior Vice President
PXYZ CORPORATION
By RICHARD T. O'BRIEN
__________________________________
Title: President
<PAGE>
EXHIBITS TO THE
AGREEMENT AND PLAN OF MERGER
Exhibit Description (Section Reference)
_______ _______________________________
A. Form of PacifiCorp Agreement (Recital F and Section 4.2.2)
B. Form of Amendment to Schedule 13D to be filed by
PacifiCorp (Section 2.2.5)
C. Form of Joint Press Release (Section 6.8)
<PAGE>
Exhibit 2B
AGREEMENT
_________
This Agreement is dated as of March 9, 1995 between
PacifiCorp, an Oregon corporation ("PacifiCorp"), and Pacific
Telecom, Inc., a Washington corporation ("PTI").
RECITALS
________
A. PacifiCorp owns all of the issued and outstanding capital
stock of PacifiCorp Holdings, Inc., a Delaware corporation
("Holdings"). On the date hereof, PTI, PXYZ Corporation, a
Washington corporation ("Merger Sub"), and Holdings are entering
into an Agreement and Plan of Merger (the "Agreement and Plan of
Merger") dated the date hereof and providing, among other things,
for the merger of Merger Sub with and into PTI (the "Merger"). PTI
has indicated that it will not enter into the Agreement and Plan of
Merger unless PTI and PacifiCorp enter into this Agreement at the
same time. PacifiCorp is entering into this Agreement with PTI
expressly for the purpose of inducing PTI to enter into the
Agreement and Plan of Merger. Immediately following the Merger,
Holdings will own all of the issued and outstanding capital stock of
PTI.
B. PacifiCorp believes that it is in the best interests of
PacifiCorp and its shareholders to consummate the Merger.
AGREEMENT
_________
In consideration of the execution by Company of the Agreement
and Plan of Merger and of the mutual covenants and agreements set
forth herein, PacifiCorp and PTI agree as follows:
1. Defined Terms. Capitalized terms used herein shall
_____________
have the meanings assigned to them in the Agreement and Plan of
Merger unless otherwise defined herein.
2. Certain Representations.
_______________________
(a) Organization and Good Standing. PacifiCorp is a
______________________________
corporation duly organized and validly existing under the laws of
the State of Oregon. PacifiCorp has all requisite corporate power
and authority to own and operate its properties and to carry on its
business as now being conducted.
(b) Corporate Authority. PacifiCorp has full
___________________
corporate power and authority to execute and deliver this Agreement
and to undertake the obligations provided for herein.
1
<PAGE>
The execution, delivery and performance of this Agreement by
PacifiCorp have been duly authorized by all requisite corporate
action and no further corporate proceedings on the part of
PacifiCorp are necessary to authorize this Agreement or to undertake
the obligations provided for herein. This Agreement has been duly
and validly executed and delivered by PacifiCorp and constitutes a
valid and binding agreement of PacifiCorp, enforceable in accordance
with its terms, except as enforcement may be affected by applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting the enforcement of creditors' rights generally and except
that the availability of the equitable remedies of specific
performance and equitable relief are subject to the discretion of
the court before which any such proceeding may be brought.
(c) Proxy Statement and Schedule 13E-3. None of the
__________________________________
information supplied or to be supplied by PacifiCorp for inclusion
in the Schedule 13E-3 or the Proxy Statement and any amendments
thereof or supplements thereto will, on the respective dates such
materials are filed with the SEC, at the time of the mailing of such
Proxy Statement or any amendment or supplement thereto to
shareholders of PTI, at the time of the Shareholder Meeting and at
the Effective Time, contain any untrue statement of a material fact
or omit to state any material fact required to be stated therein or
necessary in order to make the statements made therein, in light of
the circumstances under which they were made, not misleading. If at
any time prior to the Effective Time any event with respect to
PacifiCorp or any of its officers, directors or affiliates should
occur which is required to be described in an amendment of, or a
supplement to, the Proxy Statement or the Schedule 13E-3, such event
shall be so described, and such amendment or supplement shall be
promptly filed with the SEC and, as required by law, disseminated to
the shareholders of PTI. The Schedule 13E-3 will comply (with
respect to PacifiCorp and its officers, directors and affiliates) in
all material respects, as to form, with the applicable requirements
of each of the Exchange Act and the respective rules and regulations
thereunder.
(d) Required Approvals and Consents. Except for
_______________________________
compliance with the applicable requirements of the Exchange Act and
the securities laws of the various states, no filing with, and no
permit, authorization, consent or approval of, any public body is
necessary for the execution and delivery by PacifiCorp of this
Agreement or the consummation by PacifiCorp of the transactions
contemplated by this Agreement.
(e) Prior Offers; No Present Intent to Sell. Since
_______________________________________
January 1, 1993, to the best knowledge of PacifiCorp, after due
inquiry, PacifiCorp has not received any "proposal" or offer to
2
<PAGE>
purchase, or solicited any proposal or offer to purchase, any
material portion of the stock or assets of PTI, other than
transactions disclosed in Company SEC Reports (including, without
limitation, the sale of Alascom). For purposes of this Section 2(e)
a "proposal" may be either written or oral, but must have included a
proposed or suggested price or possible range of prices and, if made
on behalf of a corporation, must have been made by a responsible
officer or representative of that corporation. PacifiCorp has no
current plan or intent to sell or otherwise dispose of any material
portion of the stock or assets of PTI, other than transactions
disclosed in Company SEC Reports (including, without limitation, the
sale of Alascom). The Schedule 13D of PacifiCorp filed in respect
of Holdings' ownership interest in PTI, as amended by the 13D
Amendment, fully complies with all of the requirements of such
Schedule, including, without limitation, Item 4 thereof. The 13D
Amendment will be filed promptly after execution of this Agreement.
3. Proxy Materials and Schedule 13E-3. PacifiCorp will
__________________________________
cooperate fully with Holdings, Merger Sub and PTI in preparing and
filing the Schedule 13E-3 and in obtaining SEC clearance of the
Schedule 13E-3 as contemplated by Section 3.1 of the Agreement and
Plan of Merger. PacifiCorp will cause its officers and directors to
cooperate fully with PTI in responding promptly to any comments of
the SEC in regard of any of the filings made by such persons with
the SEC in connection with the transactions contemplated by this
Agreement or the Agreement and Plan of Merger.
4. Fairness of the Merger. PacifiCorp has determined that the
______________________
transactions contemplated by this Agreement and the Agreement and
Plan of Merger are fair to the Minority Shareholders.
5. Certain Filings, Consents and Arrangements.
__________________________________________
5.1 Consents. PacifiCorp shall use its best efforts to
________
obtain any necessary consents, permits, authorizations, approvals
and waivers required to be obtained by it to permit the consummation
of the transactions contemplated by the Agreement and Plan of
Merger.
5.2 Filings. PacifiCorp shall promptly determine whether
_______
any filings are required to be made by it or consents, approvals,
permits or authorizations are required to be obtained by it under
any federal, state or foreign law or regulation or any consents,
approvals or waivers are required to be obtained from other parties
to loan agreements or other agreements or instruments material to
PacifiCorp's business in connection with the consummation of the
Merger and will promptly make any such filings, furnish information
3
<PAGE>
required in connection therewith and seek timely to obtain any such
consents, permits, authorizations, approvals or waivers.
6. Dividend Policy. During the period from the date of this
_______________
Agreement to the Effective Time, PacifiCorp shall not take any
action to cause PTI to make any dividend or other distribution or
payment to Holdings with respect to Holdings Stock otherwise than in
accordance with PTI's existing dividend policies.
7. Indemnification. From and after the Effective Time,
_______________
PacifiCorp shall (to the extent specified in the following sentence)
indemnify, defend and hold harmless each person who is now a
director or officer of PTI against all losses, claims, damages,
costs, expenses or liabilities, or in connection with any claim,
action, suit, proceeding or investigation (a "Claim"), arising out
of the fact that such person is a director or officer of PTI (or out
of any action taken by any such person on behalf of PTI), pertaining
to any matter existing or occurring on or prior to the Effective
Time (or, with respect to matters arising from or in connection with
Section 1.5 of the Agreement and Plan of Merger, subsequent to the
Effective Time) (including, without limitation, the transactions
contemplated by the Agreement and Plan of Merger), whether asserted
or claimed prior to, or on or after, the Effective Time. In each
case such indemnification shall be to the full extent a corporation
is permitted under Washington law to indemnify its own directors and
officers (and PacifiCorp will pay expenses in advance of the final
disposition of any such action or proceeding to each such director
of PTI seeking indemnification hereunder to the full extent
permitted by law).
8. Notification of Certain Matters. Each of PacifiCorp and
_______________________________
PTI shall give prompt notice to the other of (i) any claims,
actions, proceedings or investigations commenced or, to the best of
its knowledge, threatened, involving or affecting the notifying
party or any of its property or assets, that relate to the Merger,
(ii) the occurrence, or failure to occur, of any event that would be
likely to cause any representation or warranty of the notifying
party contained in this Agreement or the Agreement and Plan of
Merger to be untrue or inaccurate in any material respect, and (iii)
any material failure of the notifying party or of any officer,
director, employee or agent thereof, to comply with or satisfy any
covenant, condition or agreement to be complied with or satisfied by
it hereunder or under the Agreement and Plan of Merger. No such
notification shall affect the representations or warranties of the
parties or the conditions to the obligations of the parties
hereunder or under the Agreement and Plan of Merger. Any notice
properly given by PTI to Holdings in compliance with the Agreement
4
<PAGE>
and Plan of Merger shall also constitute notice of such matter to
PacifiCorp hereunder.
9. Fees and Expenses. All costs 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.
10. Public Announcements. PacifiCorp agrees to consult with
____________________
PTI prior to issuing any public announcement or statement with
respect to the Merger, if practicable.
11. Assignment. This Agreement shall be binding upon and is
__________
solely for the benefit of the parties and their respective
successors, legal representatives and assigns, and is not intended
to confer any benefit on any third party except that Section 7 shall
be for the express benefit of the persons in the categories referred
to therein. The rights under this Agreement shall not be assigned
by either party without the prior written consent of the other.
12. Governing Law. This Agreement shall be governed by the
_____________
laws of the State of Washington applicable to contracts made and to
be performed therein.
13. Entire Agreement. This Agreement (a) contains the entire
________________
agreement between PacifiCorp and PTI with respect to the
transactions contemplated by the Agreement and Plan of Merger, and
(b) supersedes all prior agreements between the parties with respect
to such matters.
14. Notices. All notices or other communications hereunder
_______
shall be in writing and shall be given (and shall be deemed to have
been duly given upon receipt) by delivery in person, by cable,
telegram, telex or other standard form of telecommunications, or by
registered or certified mail, postage prepaid, return receipt
requested addressed as follows:
If to PTI: With copies to:
Pacific Telecom, Inc. Latham & Watkins
Attention: Special Committee of Attention: John J. Huber
the Board of Directors 1001 Pennsylvania Ave., NW
c/o James H. Huesgen Suite 1300
805 Broadway Washington, D.C. 20004-2505
Vancouver, WA 98660
5
<PAGE>
If to PacifiCorp: With copies to:
PacifiCorp Stoel Rives Boley Jones & Grey
Attention: Richard T. O'Brien Attention: Henry H. Hewitt
700 NE Multnomah 900 SW Fifth Avenue
Suite 1600 Suite 2300
Portland, Oregon 97232 Portland, Oregon 97204
or to such other address as any party may have furnished to the
other parties in writing in accordance herewith.
15. Specific Performance. The parties agree that irreparable
____________________
damage would occur if any of the provisions of this Agreement are
not performed in accordance with their specific terms or are
otherwise breached. It is agreed that the parties shall be entitled
to an injunction or injunctions to prevent breaches of this
Agreement and to enforce specifically the terms and provisions
hereof in any court of the United States or any state having
jurisdiction, in addition to any other remedy to which any party is
entitled at law or in equity.
16. Counterparts. This Agreement may be executed in
____________
counterparts, each of which when so executed shall be deemed to be
an original, and such counterparts shall together constitute but one
and the same instrument.
(Signature pages to follow)
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed as of the date first above written.
PACIFICORP
By: FREDERICK W. BUCKMAN
__________________________________
Title: Chief Executive Officer
PACIFIC TELECOM, INC.
By: CHARLES E. ROBINSON
__________________________________
Title: Chief Executive Officer
Pacific Telecom, Inc.
805 Broadway
Post Office Box 9901
Vancouver, Washington 98668-8701
360 905-5800
FOR IMMEDIATE RELEASE - MARCH 9, 1995
PACIFIC TELECOM, INC. AND PACIFICORP
ANNOUNCE DEFINITIVE MERGER AGREEMENT
FOR A $30 PER SHARE ACQUISITION
Pacific Telecom, Inc. (NASDAQ:PTCM) and PacifiCorp (NYSE:PPW)
jointly announced today a definitive merger agreement pursuant to which
PacifiCorp Holdings, Inc., a wholly-owned subsidiary of PacifiCorp,
will acquire the outstanding shares of Pacific Telecom not owned by it
for $30 per share in cash.
Under the terms of the agreement, a newly-formed, wholly-owned
subsidiary of PacifiCorp Holdings, Inc. will be merged with and into
Pacific Telecom and the holders of the approximately 5.3 million shares
of common stock of Pacific Telecom not held by PacifiCorp Holdings,
Inc. would receive $30 in cash in exchange for each share of Pacific
Telecom common stock. As a result of the merger, Pacific Telecom would
become an indirect, wholly-owned subsidiary of PacifiCorp.
The merger is conditioned upon, among other things, affirmative
approval of the merger by holders of a majority of the approximately
5.3 million shares held by the unaffiliated public shareholders.
Additional information relating to the merger, to be considered at
Pacific Telecom's annual meeting, the date of which has not been
determined, will be set forth in a proxy statement which must be
submitted to the Securities and Exchange Commission before being mailed
to shareholders.
PacifiCorp Holdings, Inc. presently owns approximately 87% of the
outstanding shares of Pacific Telecom. On November 1, 1994, it
proposed to acquire the shares not owned by it for $28 per share in
cash. Promptly thereafter, Pacific Telecom formed a Special Committee
of independent directors to receive, study, negotiate and make
recommendations to the Board of Directors of Pacific Telecom regarding
that proposal. The merger announced today has been unanimously
approved by the Board of Directors of Pacific Telecom as fair to, and
in the best interests of, Pacific Telecom's public minority
shareholders upon the unanimous recommendation of the Special Committee.
In connection with its recommendation of the transaction, the Special
Committee received the written opinions of Smith Barney Inc. and CS
First Boston Corporation, to the effect that the consideration to be
received by the minority shareholders in the merger is fair from a
financial point of view, to such holders. The Board of Directors of
PacifiCorp has received a fairness opinion from Salomon Brothers Inc.
to the effect that the consideration to be paid to minority
shareholders is fair, from a financial point of view, to PacifiCorp.
CONTACT: Brian M. Wirkkala, Vice President-Treasurer
Pacific Telecom, Inc.
805 Broadway, P.O. Box 9901
Vancouver, WA 98668-8701
Telephone: (360) 905-5800
