VOTING AGREEMENT
VOTING AGREEMENT, dated June 11, 1998, between Samstock, L.L.C., a
Delaware limited liability company ("Samstock"), and PhoneTel Technologies,
Inc., an Ohio corporation (the "Company").
WHEREAS, concurrently with the execution and delivery of this
Agreement, the Company, Davel Communications Group, Inc., an Illinois
corporation ("Old Davel"), Davel Holdings, Inc., a Delaware corporation and
a wholly owned subsidiary of Old Davel ("New Davel"), D Subsidiary, Inc.,
an Illinois corporation and a wholly owned subsidiary of New Davel ("D
Sub"), and PT Merger Corp., an Ohio corporation and a wholly owned
subsidiary of New Davel ("P Sub"), have entered into an Agreement and Plan
of Merger and Reorganization (the "Merger Agreement"), dated the date
hereof, pursuant to which (i) D Sub will be merged with and into Old Davel
with Old Davel surviving as a wholly owned subsidiary of New Davel (the
"Davel Merger") and (ii) P Sub will be merged with and into the Company
with the Company surviving as a wholly owned subsidiary of New Davel (the
"PhoneTel Merger").
WHEREAS, the consummation of the Davel Merger, the PhoneTel Merger and
the other transactions contemplated by the Merger Agreement (the
"Transaction") is subject to certain conditions, including the approval of
the Merger Agreement and the Davel Merger by the holders of at least two-
thirds of the outstanding shares of common stock, no par value, of Old
Davel ("Old Davel Common Stock").
WHEREAS, Samstock is a party to (i) a Stock Purchase Agreement by and
between Samstock and Old Davel dated May 14, 1998 (the "Davel Stock
Purchase Agreement"), (ii) a Stock Purchase Agreement by and between
Samstock and David R. Hill dated May 14, 1998 (the "Hill Stock Purchase
Agreement") and (iii) a Stock Purchase Agreement by and between Samstock
and certain directors and members of management of Old Davel (such
agreement, together with the Davel Stock Purchase Agreement and the Hill
Stock Purchase Agreement, the "Stock Purchase Agreements"). Pursuant to
the Stock Purchase Agreements, and upon the terms and subject to the
conditions set forth therein, Samstock has the right to acquire, in the
aggregate, 1,623,900 shares of Old Davel Common Stock, representing
approximately 28.75% of the outstanding shares of Old Davel Common Stock,
based on the number of shares of Old Davel Common Stock outstanding on June
1, 1998 and after giving effect to the issuance by Old Davel of the shares
of Old Davel Common Stock to be purchased by Samstock pursuant to the Davel
Stock Purchase Agreement (such 1,623,900 shares of Old Davel Common Stock,
upon acquisition thereof by Samstock, the "Purchased Shares" and, together
with any other shares of capital stock of Old Davel acquired by Samstock
after the date hereof and during the term of this Agreement being
collectively referred to herein as the "Shares").
WHEREAS, as a condition to the willingness of the Company to enter
into the Merger Agreement, and as an inducement to the Company to do so,
Samstock has agreed for the benefit of the Company as set forth in this
Agreement.
NOW, THEREFORE, in consideration of the representations, warranties,
covenants and agreements contained in this Agreement, the parties hereby
agree as follows:
ARTICLE I
DEFINITIONS
Section 1.1 The terms "Investment Agreement" and "Shareholders
Agreement" shall have the meanings set forth in the Davel Stock Purchase
Agreement.
ARTICLE II
COVENANTS OF SAMSTOCK
Section 2.1 Agreement to Vote. At any meeting of the shareholders
of Old Davel held prior to the Termination Date (as defined in Section
5.4), however called, and at every reconvened meeting following any
adjournment thereof prior to the Termination Date, or in connection with
any written consent of the shareholders of Old Davel executed prior to the
Termination Date, Samstock shall vote the Shares (a) in favor of the
approval of the Merger Agreement, the Davel Merger and each of the actions
contemplated by the Merger Agreement to be performed by Old Davel or New
Davel in connection with the Transaction and any actions required in
furtherance thereof; and (b) in favor of the election of Mr. Peter Graf as
a member of the Board of Directors of New Davel to serve until the first
anniversary of the Closing Date. Prior to the Termination Date and subject
to Section 2.3, other than the Stock Purchase Agreements, the Investment
Agreement and the Shareholders Agreement, Samstock shall not enter into any
agreement or understanding with any person, directly or indirectly, to
vote, grant any proxy or give instructions with respect to the voting of
the Shares in any manner inconsistent with the preceding sentence.
Section 2.2 Proxies. (a) Samstock hereby revokes any and all
previous proxies granted with respect to matters set forth in Section 2.1
for the Shares.
(b) Prior to the Termination Date, Samstock shall not grant any
proxies or powers of attorney with respect to matters set forth in Section
2.1, deposit any of the Shares into a voting trust or enter into a voting
agreement, other than this Agreement, the Stock Purchase Agreements, the
Investment Agreement and the Shareholders Agreement, with respect to any of
the Shares, in each case with respect to such matters.
Section 2.3 Transfer of Shares by Samstock. Prior to the
Termination Date, Samstock shall not (a) transfer, sell, exchange or
otherwise dispose of any Shares unless such transferee, purchaser or
acquiror enters into a voting agreement with the Company containing
substantially the same terms as this Agreement or (b) pledge or place any
encumbrance on any Shares, other than pursuant to this Agreement and other
than a pledge or encumbrance of any Shares to any bank or other financial
institution in connection with any bona fide financing transaction by
Samstock or any such transferee, purchaser or acquiror, provided that such
bank or financial institution, as a condition to exercising its rights to
seize and vote such Shares, enters into a voting agreement with the Company
containing substantially the same terms as this Agreement.
Section 2.4 Action in Shareholder Capacity Only. Samstock makes no
agreement or understanding herein in any capacity other than, prior to
consummation of the transactions contemplated by the Stock Purchase
Agreements, as a holder of rights to acquire the Purchased Shares and,
following consummation of such transactions, in its capacity as a record
holder and beneficial owner of the Shares, and nothing herein shall limit
or affect any actions taken in any other capacity.
ARTICLE III
REPRESENTATIONS, WARRANTIES AND
ADDITIONAL COVENANTS OF SAMSTOCK
Samstock represents, warrants and covenants to the Company that:
Section 3.1 Ownership. As of the date hereof, Samstock has the
right, upon the terms and subject to the conditions set forth in the Stock
Purchase Agreements, to acquire, in the aggregate, 1,623,900 shares of Old
Davel Common Stock. Upon consummation of the transactions contemplated by
the Stock Purchase Agreements, Samstock will be the beneficial and record
owner of such shares and, subject to Section 2.3, Samstock will have the
sole right to vote the Shares and there will be no restrictions on rights
of disposition or other liens pertaining to the Shares, other than as
contemplated by the Stock Purchase Agreements, the Investment Agreement and
the Shareholders Agreement. Samstock has not agreed to subject any Shares
to any voting trust or other agreement, arrangement or restriction with
respect to the voting of the Shares other than pursuant to the Investment
Agreement and the Shareholders Agreement.
Section 3.2 Authority and Non-Contravention. Samstock has the
right, power and authority to enter into this Agreement and, subject to the
acquisition by Samstock of the Purchased Shares upon consummation of the
transactions contemplated by the Stock Purchase Agreements, to consummate
the transactions contemplated by this Agreement. The execution and
delivery of this Agreement by Samstock and the consummation of the
transactions contemplated by this Agreement have been duly authorized by
all necessary action on the part of Samstock. This Agreement has been
duly executed and delivered by Samstock and constitutes a valid and binding
obligation of Samstock, enforceable against Samstock in accordance with its
terms, subject to general principles of equity and as may be limited by
bankruptcy, insolvency, moratorium, or similar laws affecting creditors'
rights generally. Neither the execution and delivery of this Agreement by
Samstock nor the consummation by Samstock of the transactions contemplated
hereby will (i) materially violate, or require any consent, approval or
notice under, any provision of any judgment, order, decree, statute, law,
rule or regulation applicable to Samstock or, upon acquisition thereof by
Samstock, the Purchased Shares or (ii) violate or conflict with the
limited liability company agreement of Samstock or constitute a material
violation of or default under any contract, commitment, agreement,
understanding, arrangement or other restriction of any kind to which
Samstock is a party or by which Samstock or its assets are bound.
Section 3.3 Total Shares. As of the date hereof, Samstock does not
own, beneficially (except by virtue of the Stock Purchase Agreements) or of
record, any shares of capital stock of Old Davel. Except as contemplated
by the Stock Purchase Agreements and the Shareholders Agreement, Samstock
does not have any option to purchase or right to subscribe for or otherwise
acquire any securities of Old Davel and has no other interest in or voting
rights with respect to any other securities of Old Davel.
Section 3.4 Reasonable Efforts. Prior to the Termination Date,
Samstock shall use reasonable efforts to take, or cause to be taken, all
actions, and to do, or cause to be done, and to assist and cooperate with
Old Davel in doing, all things reasonably necessary, proper or advisable to
consummate and make effective, in the most expeditious manner reasonably
practicable, the Transaction.
ARTICLE IV
REPRESENTATIONS, WARRANTIES AND COVENANTS OF
THE COMPANY
The Company represents, warrants and covenants to Samstock that:
Section 4.1 Authority and Non-Contravention. The Company has the
right, power and authority to enter into this Agreement and to consummate
the transactions contemplated by this Agreement. The execution and
delivery of this Agreement by the Company and the consummation of the
transactions contemplated by this Agreement have been duly authorized by
all necessary action on the part of the Company. This Agreement has been
duly executed and delivered by the Company and constitutes a valid and
binding obligation of the Company, enforceable against the Company in
accordance with its terms, subject to general principles of equity and as
may be limited by bankruptcy, insolvency, moratorium or similar laws
affecting creditors' rights generally. Neither the execution and delivery
of this Agreement nor the consummation by the Company of the transactions
contemplated hereby will (i) materially violate, or require any consent,
approval or notice under, any provision of any judgment, order, decree,
statute, law, rule or regulation applicable to the Company or (ii) violate
or conflict with the articles of incorporation or code of regulations of
the Company or constitute a material violation of or default under any
contract, commitment, agreement, understanding, arrangement or other
restriction of any kind to which the Company is a party or by which the
Company or its assets are bound.
ARTICLE V
MISCELLANEOUS
Section 5.1 Expenses. All costs and expenses incurred in
connection with this Agreement shall be paid by the party incurring such
costs or expenses.
Section 5.2 Further Assurances. From time to time, at the request
of the Company, in the case of Samstock, or at the request of Samstock, in
the case of the Company, and without further consideration, each party
shall execute and deliver or cause to be executed and delivered such
additional documents and instruments and take all such further action as
may be reasonably necessary or desirable to consummate the transactions
contemplated by this Agreement.
Section 5.3 Specific Performance. Samstock agrees that the Company
would be irreparably damaged if for any reason Samstock fails to perform
any of Samstock's obligations under this Agreement, and that the Company
would not have an adequate remedy at law for money damages in such event.
Accordingly, the Company shall be entitled to seek specific performance and
injunctive and other equitable relief to enforce the performance of this
Agreement by Samstock. This provision is without prejudice to any other
rights that the Company may have against Samstock for any failure to
perform its obligations under this Agreement.
Section 5.4 Amendments, Termination. This Agreement may not be
modified or amended except by an instrument or instruments in writing
signed by each party hereto. The representations, warranties, covenants
and agreements set forth in Article II, Article III and Article IV shall
terminate, except with respect to liability for prior breaches thereof,
upon the earliest to occur of (i) termination of the Merger Agreement in
accordance with its terms, (ii) the Closing Date and (iii) the date, if
any, upon which the Company's Board of Directors withdraws, modifies or
changes its recommendation or approval of the Merger Agreement or the
PhoneTel Merger in a manner adverse to Old Davel (the "Termination Date");
provided, however, that with respect to clause (b) of Section 2.1,
"Termination Date" shall mean the first anniversary of the Closing Date.
Section 5.5 Assignment. Subject to Section 2.3 hereof, neither
this Agreement nor any of the rights, interests or obligations under this
Agreement shall be assigned, in whole or in part, by operation of law or
otherwise by any of the parties without the prior written consent of the
other parties. Subject to the preceding sentence, this Agreement shall be
binding upon, and inure to the benefit of, the parties hereto and their
respective successors and assigns.
Section 5.6 Certain Events. Samstock agrees that this Agreement
and the obligations hereunder shall attach to the Shares and shall be
binding upon any person to which legal or beneficial ownership of such
shares shall pass, whether by operation of law or otherwise.
Section 5.7 Entire Agreement. This Agreement (including the
documents referred to herein) (a) constitutes the entire agreement, and
supersedes all prior agreements and understanding, both oral and written
between the parties with respect to the subject matter of this Agreement
and (b) is not intended to confer upon any person other than the parties
hereto any rights or remedies.
Section 5.8 Notices. All notices and other communications
hereunder shall be in writing and shall be deemed given if delivered
personally, sent by documented overnight delivery service or telecopied
with confirmation of receipt, to the parties at the addresses specified
below (or at such other address or telecopy or telex number for a party as
shall be specified by like notice):
If to the Company, to:
PhoneTel Technologies, Inc.
1001 Lakeside Avenue, 7th Floor
Cleveland, Ohio 44114
Attention: General Counsel
Telecopy number: 216.875.4337
with a copy to:
Skadden, Arps, Slate, Meagher & Flom
919 Third Avenue
New York, New York 10022
Attention: Stephen M. Banker, Esq.
Telecopy number: 212.735.2000
If to Samstock, to:
Samstock, L.L.C.
Two North Riverside Plaza
Chicago, Illinois 60606
Attention: Mr. F. Philip Handy
Telecopy number: 312.454.1671
with a copy to:
Rosenberg & Liebentritt, P.C.
Two North Riverside Plaza
Chicago, Illinois 60606
Attention: Walter S. Lowry, Esq.
Telecopy number: 312.454.0335
Section 5.9 Governing Law. This Agreement shall be governed by,
and construed in accordance with, the laws of the State of Illinois
regardless of the laws that might otherwise govern under applicable
principles of conflicts of laws thereof.
Section 5.10 Counterparts. This Agreement may be executed in two or
more counterparts, all of which shall be considered one and the same
agreement, and, shall become effective when one or more counterparts have
been signed by each of the parties and delivered to the other parties in
original or facsimile form.
Section 5.11 Interpretation. The headings contained in this
Agreement are inserted for convenience of reference only and shall not
affect in any way the meaning or interpretation of this Agreement.
Section 5.12 Severability. Any provision hereof which is invalid or
unenforceable shall be ineffective to the extent of such invalidity or
unenforceability, without affecting in any way the remaining provisions
hereof.
Section 5.13 Consent to Jurisdiction. Each party hereto irrevocably
submits to the nonexclusive jurisdiction of (a) the state courts of the
State of Illinois and (b) the United States federal district courts located
in the State of Illinois for the purposes of any suit, action or other
proceeding arising out of this Agreement or any transaction contemplated
hereby.
Section 5.14 Attorney's Fees. If any action at law or in equity is
necessary to enforce or interpret the terms of this Agreement, the
prevailing party shall be entitled to reasonable attorneys' fees, costs and
necessary disbursements, in addition to any other relief to which such
party may be entitled.
IN WITNESS WHEREOF, this Agreement has been signed by or on behalf of
each of the parties as of the date first above written.
SAMSTOCK, L.L.C.
By SZ Investments, L.L.C., its sole member
By Zell General Partnership, Inc., its
managing member
By: __________________________________
Name:
Title:
PHONETEL TECHNOLOGIES, INC.
By: __________________________________
Name:
Title: