Closing Agreement Amending Purchase Agreement Between TeleCorp Entities and SBA Entities (March 16, 2001)
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This agreement, dated March 16, 2001, is between TeleCorp Realty, L.L.C., Telecorp Puerto Rico Realty, Inc., TeleCorp Communications, Inc. (collectively "TeleCorp"), and SBA Towers, Inc. and SBA TC Acquisition, Inc. (collectively "SBA"). It amends a prior purchase agreement to change the structure of the transaction, set the closing date for the sale of 203 telecommunications sites, and outline the purchase price of $66,482,500. TeleCorp must clear certain liens on the sites, with funds held in escrow until releases are provided. The agreement also details the escrow agent's responsibilities and indemnification.
EX-10.3 5 dex103.txt CLOSING AGMT. TO PURCHASE AGMT. EXHIBIT 10.3 CLOSING AGREEMENT TO PURCHASE AGREEMENT THIS CLOSING AGREEMENT TO PURCHASE AGREEMENT (the "Closing Agreement") is executed this 16th day of March, 2001 by and among TeleCorp Realty, L.L.C., a Delaware limited liability company ("TeleCorp Realty, LLC"), Telecorp Puerto Rico Realty, Inc., a Puerto Rico corporation ("Telecorp PR"), and TeleCorp Communications, Inc., a Delaware corporation ("TCI") (TeleCorp Realty, Telecorp PR and TCI, collectively "TeleCorp" and individually a "TeleCorp Party"), SBA Towers, Inc., a Florida corporation ("SBA Towers") and SBA TC Acquisition, Inc., a Florida corporation ("SBA TC") (SBA Towers and SBA TC, collectively "SBA"). WHEREAS, TeleCorp and SBA entered into that certain Purchase Agreement dated September 15, 2000, as amended from time to time (collectively, the "Contract") in which TeleCorp agreed to assign, sell and convey certain leases, towers and related facilities to a Delaware corporation to be formed and wholly owned by TeleCorp ("NewCo") and then sell and convey all of the issued and outstanding shares of capital stock of NewCo ("Shares") to SBA; WHEREAS, TeleCorp and SBA wish to amend the Contract to (i) provide that NewCo shall be formed and wholly owned by SBA and not TeleCorp, (ii) provide that the closing on the Assets pertaining to two hundred three (203) sites shall occur on March 16, 2001, and (iii) address other matters pertaining to the purchase of the Assets by SBA. NOW THEREFORE, for and in consideration of the terms and mutual promises herein contained and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, TeleCorp and SBA agree as follows: 1. Definitions. All terms not expressly defined herein shall have the meaning ----------- ascribed to them in the Contract. 2. Stock Purchase. Section 2 of the Contract is deleted in its entirety. -------------- Notwithstanding anything contained in the Contract to the contrary, NewCo shall be formed by SBA and wholly owned by SBA. All references in the Contract to the name "NewCo" shall mean and refer to SBA TC Acquisition, Inc., a Florida corporation ("SBA TC"). 3. Assets Purchased by NewCo from TeleCorp. Two hundred three (203) Sites --------------------------------------- have been approved for purchase by SBA and the Closing for said 203 Sites shall occur on March 16, 2001 at the offices of Gunster, Yoakley & Stewart, P.A. in West Palm Beach, Florida. A schedule of such 203 Sites is attached hereto as Exhibit A (the "Approved Sites"). On the Closing, TeleCorp agrees to grant, - --------- bargain, sell, convey and assign to SBA TC, TeleCorp's entire right, title and interest in and to the Assets that pertain to the Approved Sites. 4. Purchase Price. The purchase price for the Assets pertaining to the -------------- Approved Sites shall be SIXTY-SIX MILLION FOUR HUNDRED EIGHTY TWO THOUSAND FIVE HUNDRED AND NO/100 DOLLARS ($66,482,500.00) subject to all adjustments, credits and prorations provided for in the Contract. 5. Release of Liens. ---------------- a. TeleCorp and SBA acknowledge that certain of the Approved Sites described in Exhibit B attached hereto ("Approved Sites with Liens") --------- have liens recorded against them for failure to pay the costs of development and construction of the Tower Facilities located thereon. It is and shall remain the continuing and affirmative obligation of TeleCorp to (i) obtain releases of liens in recordable form for all Approved Sites with Liens, (ii) record said releases of liens in the appropriate recording office(s), and (iii) provide copies of said recorded releases to SBA with thirty (30) days after the Closing Date. TeleCorp represents and warrants to SBA that, to the best of TeleCorp's knowledge, except for the Approved Sites with Liens described in Exhibit B attached hereto, there are no other Approved Sites subject to --------- liens in connection with the failure of TeleCorp to pay the costs of development and construction of the Tower Facilities. Subject to the limitation on damages as set forth in Sections 15(b)(v) and 15(b)(ii)of the Contract, TeleCorp shall remain liable for the payment of any liens filed against Approved Sites for that certain period of time terminating on the date(s) on which the applicable state lien filing period expires. b. To ensure compliance with the terms of subsection (a) above, Gunster Yoakley & Stewart, P.A. ("Escrow Agent") is authorized and directed to withhold an amount equal to one hundred twenty-five percent (125%) of the aggregate amount of said liens (as set forth in Exhibit B) (the "Escrowed Funds") from the proceeds due TeleCorp at closing and deposit the Escrowed Funds into an interest bearing account. The Escrowed Funds applicable to each Approved Site with Liens shall be held in escrow by Escrow Agent until TeleCorp delivers to SBA for each Approved Site with Lien a release of lien as recorded in the appropriate recording office evidencing the satisfaction and release of the Lien ("Release"). c. Upon SBA's receipt of a Release for each Approved Site with a Lien, SBA shall immediately notify Escrow Agent, in writing, that the Escrowed Funds applicable to such Approved Site with Liens shall be promptly released to TeleCorp. Upon receipt of the last remaining Release, SBA shall authorize Escrow Agent to release any remaining Escrowed Funds to TeleCorp. d. SBA shall have no obligation to pay any sums of money to obtain the Releases. e. The Escrow Agent shall have no responsibilities with respect to any of the funds deposited with it other than faithfully to follow instructions herein contained, or as otherwise agreed to by TeleCorp and SBA. Escrow Agent shall be protected in acting upon any written notice, request, waiver, consent, receipt or other paper or document which Escrow Agent in good faith believes to be genuine. Escrow Agent shall not be liable for any error of judgment, or for any act done or step taken or omitted by it in good faith, or for any mistake of fact, or for anything which it may do or refrain from doing in connection herewith, except its own gross negligence or willful misconduct. If conflicting demands not expressly provided for in this Closing Agreement are made or notice is served upon Escrow Agent with respect to its action or omission under this Closing Agreement, the parties hereto agree that Escrow Agent shall have the absolute right to elect to do either or both of the following: (i) withhold and stop all future actions or omissions on its part under this Agreement, or (ii) file a suit in interpleader or for instructions or for a declaratory judgment or other relief and obtain an order from the proper court requiring the parties to litigate in such court their conflicting claims and demands. In the event any such action is taken, Escrow Agent shall be fully released and discharged from all obligations to perform any duties or obligations imposed upon it hereunder unless and until otherwise ordered by the Court; and the parties jointly and severally agree to pay all costs, expenses, and reasonable attorneys' fees expended or incurred by Escrow Agent in connection therewith. As between SBA and TeleCorp, in the event any costs or expenses are incurred by Escrow Agent as a result of conflicting demands by SBA and TeleCorp, the prevailing party in any such conflict shall be reimbursed by the other party for any costs, expenses or other monies paid to Escrow Agent as a result of such conflict. The parties further agree to indemnify, defend and save the Escrow Agent harmless from any claims or damages incurred by it(including reasonable attorneys' fees, paralegal charges and costs) arising from the performance of its duties hereunder, except for such claims or damages as are incurred by the Escrow Agent through its own acts of gross negligence or willful and intentional misconduct. 6. UCC-3 Releases. SBA and TeleCorp acknowledge that all of the Tower -------------- Facilities located on the Approved Sites are subject to UCC-1 Financing Statements in favor of Chase Manhattan Bank ("Chase"). SBA and TeleCorp further acknowledge that the UCC-1 Financing Statements will not be released of record by the Closing Date. Notwithstanding the foregoing, Chase has released its security interests and claims no further interests in the Tower Facilities pursuant to those letters from Chase to TeleCorp and SBA each dated March 16, 2001 (collectively, the "Chase Letters"). Subject to SBA's obligation to prepare the UCC-3's in a form acceptable to Chase and pay all filing and related fees, TeleCorp acknowledges and agrees that it shall remain the continuing and affirmative obligation of TeleCorp and TeleCorp shall use commercially reasonable efforts to obtain from Chase, by not later than July 19, 2001, UCC-3 (Releases) for all of the Tower Facilities located on the Approved Sites which releases shall terminate and release any and all security interests held by Chase in the Tower Facilities. Notwithstanding the foregoing, it is the intent of the parties that SBA's attorneys shall prepare the UCC-3 (Releases). In the event attorneys for Chase prepare the UCC-3's, (i) SBA's obligation to pay for said releases shall not exceed an amount equal to $30.00 multiplied by the number of UCC-3's prepared plus all 2 recording costs, and (ii) TeleCorp shall be responsible for the excess amount of legal fees owed to Chase's attorneys. SBA or its attorneys shall prepare the UCC-3's in a form acceptable to Chase, as Administrator and Collateral Agent, reflecting the description of the released Tower Facilities. The amount of legal fees paid by SBA in connection therewith shall be applied against the $2,000,000 of damages referred to in Sections 15(b)(v) and 15(b)(ii) of the Contract. ----------------- --------- 7. Memorandums of Leases. SBA and TeleCorp acknowledge that certain of the --------------------- Approved Sites do not have Memorandums of Leases recorded in the appropriate recording office(s). The parties acknowledge and agree that they shall cooperate with each other in obtaining and recording Memorandums of Leases for all such Approved Sites within thirty (30) days after the Closing Date. The amount of legal fees paid by SBA in connection therewith shall be applied against the $2,000,000 of damages referred to in Sections15(b)(v) and ---------------- 15(b)(ii)of the Contract. - --------- 8. Electric Bills. The parties acknowledge that TeleCorp's equipment and the -------------- lighting on the Tower Facilities are all a part of the same electrical feed. For all Tower Facilities on Approved Sites on which TeleCorp's equipment is connected to lighting systems, TeleCorp shall receive a credit under the applicable Site Lease Acknowledgment in an amount equal to Forty Dollars ($40.00) per month. The aforementioned credit shall terminate at such time as TeleCorp's equipment and the lighting for the Tower Facilities are separately metered. SBA shall have no obligation to install a new electric meter with respect to any light system until such time as a second tenant installs its equipment on a Tower. 9. Monitoring of Lights. With respect to the Approved Sites, TeleCorp agrees -------------------- to monitor the lights on the Tower Facilities for a period not to exceed four (4) months after the Closing Date. All such monitoring shall be conducted in accordance with FAA and FCC regulations. In the event of an electrical outage or alarm on any of the Tower Facilities, TeleCorp shall immediately contact SBA's NOC and SBA shall be responsible for filing the NOTAM and providing a copy to TeleCorp. TeleCorp shall have no liability to SBA with respect to any power outages or power failures on the Tower Facilities. Within a reasonable period after the Closing Date not to exceed ninety (90) days, SBA shall register in SBA's name the Tower Facilities associated with the Approved Sites with the FAA and FCC and any other applicable governmental agencies. 10. Cooperation. In connection with the transfer of the Tower Facilities to ----------- SBA, TeleCorp agrees to provide the following information to SBA within thirty (30) days after the Closing Date: a. Contact names and numbers per defined operational area; b. Defined operational area boundary; c. List of towers by site indicating if lights are installed and if so the manufacture, model number, and operational mode (red only, white only, dual, etc.); d. Gate lock combo codes and/or keys by site; e. Light controller locations by site (inside/outside); f. Site directions; and g. Any existing maintenance agreements (grounds, towers, lights, etc.). 11. Closing Prorations. ------------------ a. Rent paid by TeleCorp under the Site Lease Acknowledgments for all Approved Sites shall be prorated as of 12:01 A.M. on the Closing Date on the basis of a 30-day month. SBA shall receive a credit against the Purchase Price in an amount equal to the aggregate amount of said rent. b. Rent paid by TeleCorp under the Prime Leases for all Approved Sites shall be prorated as of 12:01 A.M. on the Closing Date on the basis of a 30-day month. TeleCorp shall receive a credit against the Purchase Price in an amount equal to the aggregate amount of said rent. c. All other items to be prorated pursuant to Section 3(b) of the ------------ Contract shall be prorated as of 12:01 A.M. on the Closing Date but will be calculated within thirty (30) days after the Closing Date and either party owing the other party a sum of money based on such subsequent prorations will promptly pay the sum to the other party. Any excess interest on the Deposit received by TeleCorp shall be refunded to SBA within said thirty (30) day period. 3 d. A copy of the Closing Statement is attached hereto as Exhibit C and is incorporated by reference herein. 12. Delivery of Due Diligence Items. Notwithstanding anything to the contrary ------------------------------- contained in Section 4(b)(viii) of the Contract, TeleCorp shall have until ------------------ thirty (30) days after the Closing Date to deliver to SBA the originals of the Due Diligence Items described therein, provided, however, SBA shall have no obligation to return a copy of said documents to TeleCorp. 13. Subsequent Closings. Subsequent to the Closing and through July 19, 2001, ------------------- SBA and TeleCorp shall continue pursuant to Section 7(c) of the Contract to take ------------ Curative Actions with respect to any Sites subject to the Contract but not yet closed upon. During such time, SBA shall continue to close on such Sites in accordance with the terms of the Contract. Said closings shall occur by mail on the later of (i) the last business day of every month beginning with the month of April, or (ii) at such time SBA has approved a minimum of ten (10) Sites for closing. Notwithstanding anything contained herein or in the Contract to the contrary, SBA shall have no obligation to close on any Sites unless SBA has received from Chase executed UCC-3 (Releases) for all Tower Facilities pertaining to the Approved Sites and those Sites scheduled to close. Any Site which is not subject to a Closing by July 19, 2001 shall be deemed an Excluded Site for purposes of the Contract. 14. Further Assurances. Each party will, from time to time, execute, ------------------ acknowledge and deliver such further instruments, and perform such additional acts, and obtain such additional documents as the other party may reasonably request in order to effectuate the intent of the Contract. The foregoing shall include, without limitation, SBA and TeleCorp (i) continuing to take Curative Actions with respect to Approved Sites, (ii)obtaining the documents and complying with the terms of Section 5, Section 6, Section 7, Section 8 , Section --------- --------- --------- --------- ------- 9 and Section 10 of this Closing Agreement, and (iii) obtaining corrective - - ---------- assignments of prime leases or such other corrective closing documents or additional closing documents that either party may reasonably request in order to effectuate the intent of the Agreement. With respect to the Approved Sites, TeleCorp covenants and agrees to provide written notice to all tenants under the Collocation Agreements immediately after the Closing Date advising said tenants of the sale of the Assets and instructing the tenants that all rents payouts shall be sent directly to SBA. SBA agrees to provide TeleCorp with a closing binder containing copies of the file marked documents executed at the Closing within a reasonable time thereafter. 15. No Other Modification. Except as expressly modified by this Closing --------------------- Agreement, the terms and provisions of the Contract are ratified and confirmed by TeleCorp and SBA and are incorporated in this Closing Agreement by reference as if set forth fully herein. In the event of any conflict between the terms of the Contract and the terms of this Closing Agreement, the terms of this Closing Agreement shall control. The term "Contract" shall include this Closing Agreement. [NO FURTHER TEXT ON THIS PAGE] 4 IN WITNESS WHEREOF, SBA and TeleCorp have executed this Closing Agreement as of the date and year first above written. SBA TOWERS, INC., a Florida corporation By: /s/ Neil Seidman --------------------------------- Name: Neil Seidman ------------------------------ Title: Director of Acquisitions ------------------------------ (CORPORATE SEAL) SBA TC ACQUISITION, INC., a Florida corporation By: /s/ Neil Seidman --------------------------------- Name: Neil Seidman ------------------------------ Title: Director of Acquisitions ------------------------------ (CORPORATE SEAL) TELECORP REALTY, L.L.C., a Delaware limited liability company By: TeleCorp Communications, Inc., a Delaware corporation, its Managing Member By: /s/ Ronald W. Keefe, Jr. -------------------------------- Name: Ronald W. Keefe, Jr. (CORPORATE SEAL) TELECORP PUERTO RICO REALTY, INC., a Puerto Rico corporation By: /s/ Ronald W. Keefe, Jr. -------------------------------- Name: Ronald W. Keefe, Jr. (CORPORATE SEAL) TELECORP COMMUNICATIONS, INC., a Delaware corporation By: /s/ Ronald W. Keefe, Jr. -------------------------------- Name: Ronald W. Keefe, Jr. Title: Assistant Secretary (CORPORATE SEAL) 5 EXHIBIT A --------- Schedule of Approved Sites --------------------------
EXHIBIT B --------- Approved Sites with Liens -------------------------
