Exhibit 99.5
EXECUTION COPY
================================================================================
PURCHASE AND SALE AGREEMENT
dated as of
July 26, 2002
by and between
THE XXXXXXXX COMPANIES, INC.
and
LEUCADIA NATIONAL CORPORATION
================================================================================
TABLE OF CONTENTS
ARTICLE I DEFINITIONS AND INTERPRETATION..............................................1
Section 1.01. Definitions.........................................................1
Section 1.02. Interpretation......................................................7
ARTICLE II SALE OF CLAIMS.............................................................7
Section 2.01. Sale of the Claims and the WCG Note.................................7
Section 2.02. Excluded Claims.....................................................8
Section 2.03. Closing Payment.....................................................8
Section 2.04. Closing.............................................................8
Section 2.05. Deliveries by Seller................................................8
Section 2.06. Deliveries by Purchaser.............................................9
Section 2.07. Purchase Price Allocation...........................................9
ARTICLE III REPRESENTATIONS AND WARRANTIES............................................9
Section 3.01. Representations of Seller...........................................9
Section 3.02. Representations of Purchaser.......................................11
ARTICLE IV COVENANTS AND AGREEMENTS..................................................12
Section 4.01. February 23, 2002 Letter...........................................12
Section 4.02. Communications Investment..........................................12
Section 4.03. No Shop............................................................13
Section 4.04. Impairment.........................................................13
Section 4.05. Purchaser Support of Plan and TWC Settlement Agreement.............13
Section 4.06. Seller Support of Plan.............................................14
Section 4.07. Voting.............................................................14
Section 4.08. Seller Rights......................................................14
Section 4.09. Non-assumption of Liabilities......................................14
Section 4.10. Condition of Claims and WCG Note...................................14
Section 4.11. Make-Whole Provision...............................................15
Section 4.12. HSR Act............................................................16
Section 4.13. Covenant to Satisfy Conditions.....................................16
Section 4.14. Further Assurances.................................................16
ARTICLE V CONDITIONS PRECEDENT.......................................................16
Section 5.01. Conditions to Purchaser's Obligation to Effect the Closing.........16
Section 5.02. Conditions to Seller's Obligation to Effect the Closing............17
ARTICLE VI TERMINATION...............................................................18
Section 6.01. Termination........................................................18
Section 6.02. Effect of Termination..............................................19
Section 6.03. Liquidated Damages.................................................19
ARTICLE VII MISCELLANEOUS............................................................19
Section 7.01. Expenses...........................................................19
Section 7.02. Extension; Waiver..................................................19
i
Section 7.03. Transfer Taxes.....................................................19
Section 7.04. Notices............................................................19
Section 7.05. Entire Agreement; Amendment........................................21
Section 7.06. Governing Law......................................................21
Section 7.07. Jurisdiction.......................................................21
Section 7.08. Counterparts.......................................................21
Section 7.09. Severability.......................................................21
Section 7.10. Headings...........................................................21
Section 7.11. Assignment.........................................................22
Section 7.12. Successors and Assigns.............................................22
Section 7.13. No Third-Party Beneficiaries.......................................22
Section 7.14. Publicity..........................................................22
Schedules
Schedule 2.01(a)(i) ADP Claims
Schedule 2.02(a) Services Agreements
Exhibits
Exhibit A Plan
Exhibit B Form of Claims Assignment
Exhibit C Investment Agreement
Exhibit D TWC Settlement Agreement
ii
PURCHASE AND SALE AGREEMENT
This PURCHASE AND SALE AGREEMENT, dated as of July 26,
2002, by and between THE XXXXXXXX COMPANIES, INC., a Delaware corporation
("Seller") and LEUCADIA NATIONAL CORPORATION, a New York corporation
("Purchaser").
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, Seller owns certain claims against Xxxxxxxx
Communications Group, Inc., a Delaware corporation ("Communications") and
certain of its affiliates (collectively, "WCG");
WHEREAS, Seller, in its capacity as the agent of the
Indenture Trustee (as defined below) pursuant to Section 9.04 of the Trust Note
Indenture (as defined below) has the right and ability to direct the sale of the
WCG Note (as defined below) at the highest reasonably available market price (on
an arm's length basis);
WHEREAS, Seller has determined after due inquiry that the
portion of the Purchase Price (as defined below) allocated to the WCG Note
pursuant to this Agreement is the highest reasonably available market price (on
an arm's length basis) for the WCG Note;
WHEREAS, Communications and its subsidiary, CG Austria,
Inc., a Delaware corporation (collectively, the "Debtors") are debtors in
possession, having filed voluntary petitions on April 22, 2002, for relief
pursuant to chapter 11 of title 11 of the United States Code, 11 U.S.C. xx.xx.
101-1330 (as amended, the "Bankruptcy Code"), whose cases are pending in the
United States Bankruptcy Court for the Southern District of New York (the
"Bankruptcy Court") and procedurally consolidated under Case No. 02-11957 (the
"Bankruptcy Case");
WHEREAS, Seller desires to sell to Purchaser, and Purchaser
desires to purchase from Seller, the Claims (as defined below) and the WCG Note,
in the manner and subject to the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the foregoing premises
and the representations, warranties, covenants and agreements contained herein,
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, and intending to be legally bound hereby, the
parties hereto hereby agree as follows:
ARTICLE I
DEFINITIONS AND INTERPRETATION
Section 1.01. Definitions. For all purposes of this
Agreement, except as otherwise expressly provided or unless the context clearly
requires otherwise, the following capitalized terms shall have the following
meanings:
"ADP Claims" has the meaning set forth in Section
2.01(a)(i).
"Affiliate" shall mean, with respect to any Person, any
other Person which, directly or indirectly, through one or more intermediaries,
controls, or is controlled by, or is under common control with, such Person;
provided that, for the purposes of this definition, "control" (including with
correlative meanings, the terms "controlled by" and "under common control
with"), as used with respect to any Person, shall mean the possession, directly
or indirectly, of the power to direct or cause the direction of the management
and policies of such Person, whether through the ownership of voting securities
or partnership interests, by contract or otherwise.
"Agreement" shall mean this Purchase and Sale Agreement,
together with the Schedules and Exhibits hereto, as amended, supplemented or
otherwise modified from time to time.
"Applicable Law" shall mean any applicable law, regulation,
rule, order, judgment or decree.
"April Agreement" shall mean the agreement dated as of
April 19, 2002 by and among Debtors, WCL, certain Subsidiaries of WCG, certain
Bondholders and certain Lenders, as amended, supplemented or otherwise modified
from time to time.
"Asset Defeasance Program" shall mean the transactions
pursuant to which WCL leased certain property from State Street Bank and Trust
Company of Connecticut, National Association, as trustee, as set forth in (i)
the Amended and Restated Participation Agreement, dated as of September 2, 1998,
among Xxxxxxxx Communications, Inc., State Street Bank and Trust Company of
Connecticut, National Association, as trustee and various other parties named
therein, and (ii) the Operative Documents (as defined therein), as amended,
supplemented or otherwise modified from time to time.
"Bank Agent" shall mean Bank of America, N.A., as agent
under the WCG Bank Facility.
"Bankruptcy Case" has the meaning set forth in the recitals
hereof.
"Bankruptcy Code" has the meaning set forth in the recitals
hereof.
"Bankruptcy Court" has the meaning set forth in the
recitals hereof.
"Bankruptcy Rules" shall mean the Federal Rules of
Bankruptcy Procedure, as the same are applicable to the Bankruptcy Case.
"Bondholders" shall mean the holders of the Senior
Redeemable Notes.
"Building Purchase" shall mean the purchase by WTC of all
of the Property for (1) Fifty Million Dollars ($50,000,000) in cash (subject to
adjustment as set forth in the agreements and documents evidencing the Building
Purchase), and (ii) the issuance by WTC and Communications (or, pursuant to the
terms of such agreement, Reorganized Communications), as makers, and WCL, as
guarantor, of a 10-year promissory note made payable to Xxxxxxxx Headquarters
Building Company, a Delaware corporation, in the amount of One Hundred Million
2
Dollars ($100,000,000) (reduced by the amount realized from the disposition or
refinancing of the outstanding Aircraft Dry Leases, dated September 13, 2001, or
the aircraft covered thereby, as set forth in the agreements and documents
evidencing the Building Purchase) with interest at the rate of 7% per annum, and
principal to be amortized until maturity on the basis of a 30-year schedule, the
payment of which shall be secured by a first lien mortgage and security interest
in and to the Property.
"Business Day" shall mean any day other than a Saturday,
Sunday or a day on which banks in New York City are authorized or obligated by
law or executive order to close or are otherwise generally closed.
"Causes of Action" shall mean all rights, claims, causes of
action, defenses, demands, rights to recover damages and debts from third
parties, and rights to enforce against third parties obligations and liabilities
of any kind or nature under contract, at law or in equity, known or unknown,
contingent or mature, liquidated or unliquidated, and all remedies with respect
thereto.
"Claims" shall mean the ADP Claims and the Pre-Spin
Services Claims.
"Claims Assignment" shall mean the Assignment of Claims to
be executed by Seller with respect to the ADP Claims and the Pre-Spin Services
Claims in substantially the form attached hereto as Exhibit B.
"Claims Documents" shall mean all guarantees, security
agreements, mortgages, deeds of trust, letters of credit, reimbursement
agreements, waivers, supplements, modifications and amendments and all other
documents and agreements evidencing (i) the ADP Claims and (ii) the Pre-Spin
Services Claims.
"Claims Exchange Consideration" has the meaning set forth
in Section 4.11(a).
"Closing" has the meaning set forth in Section 2.04.
"Closing Date" has the meaning set forth in Section 2.04.
"Code" shall mean the Internal Revenue Code of 1986, as
amended.
"Committee" shall mean the Official Committee of Unsecured
Creditors appointed in the Bankruptcy Case.
"Communications" has the meaning set forth in the recitals
hereof.
"Communications Investment" shall mean the investment by
Purchaser of One Hundred Fifty Million Dollars ($150,000,000) in Communications
or Reorganized Communications pursuant to the Investment Agreement.
"Confidentiality Agreement" shall mean the Confidentiality
Agreement between Purchaser and Seller dated May 23, 2002, as amended,
supplemented or otherwise modified from time to time.
3
"Confirmation Order" has the meaning set forth in Section
5.01(g).
"Debtors" has the meaning set forth in the recitals hereof.
"Disclosure Statement" has the meaning set forth in Section
4.05(b).
"Excluded Claims" has the meaning set forth in Section
2.02.
"February 23 Agreement" has the meaning set forth in
Section 4.01.
"Final Order" shall mean (a) an order or judgment of the
Bankruptcy Court as to which the time to appeal, petition for certiorari, or
other proceedings for reargument or rehearing has expired and as to which no
appeal, petition for certiorari, or other proceedings for reargument or
rehearing shall then be pending or, (b) in the event that an appeal, petition
for certiorari, or for reargument or rehearing has been sought, such order of
the Bankruptcy Court shall have been affirmed by the highest court to which such
order was appealed or from which reargument or rehearing was sought, or
certiorari has been denied, and the time to take any further appeal, petition
for certiorari or other proceedings for reargument or rehearing shall have
expired; provided, that no order shall fail to be a Final Order solely because
of the possibility that a motion pursuant to Rule 60 of the Federal Rules of
Civil Procedure or Rule 7024 of the Bankruptcy Rules may be filed with respect
to such order.
"Governmental Entity" shall mean a court, arbitral
tribunal, administrative agency or commission or other governmental or other
regulatory authority or agency.
"HSR Act" shall mean the Xxxx-Xxxxx-Xxxxxx Antitrust
Improvements Act of 1976, as amended.
"Indenture Trustee" shall mean Xxxxx Fargo, N.A., a
national banking association, as successor to United States Trust Company of New
York, a New York banking corporation, as indenture trustee and securities
intermediary under the Trust Note Indenture.
"Investment Agreement" shall mean the investment agreement,
of even date herewith, by and among Purchaser, Communications and WCL, pursuant
to which Purchaser shall make the Communications Investment, a true and correct
copy of which is attached hereto as Exhibit C.
"Issuer" shall mean WCG Note Trust, a special purpose
statutory business trust created under the laws of the state of Delaware.
"Issuer Trustee" shall mean Wilmington Trust Company, in
its capacity as Issuer's trustee.
"Lenders" shall mean the lenders under the WCG Bank
Facility.
"Note Documents" shall mean the WCG Note, the WCG Note
Indenture, the Trust Note Indenture and all guarantees, security agreements,
mortgages, deeds of trust, letters of credit, remarketing and reimbursement
agreements, waivers, supplements, modifications and amendments and all other
4
documents and agreements evidencing (i) the WCG Note, (ii) the WCG Note
Indenture and (iii) the Trust Note Indenture.
"Person" shall mean a natural person, partnership,
corporation, limited liability company, business trust, joint stock company,
trust, unincorporated association, joint venture, Governmental Entity or other
entity or organization.
"Plan" shall mean the First Amended Chapter 11 Plan Of
Reorganization With Respect To The Debtors, dated as of July 26, 2002, a true
and correct copy of which is attached hereto as Exhibit A, as it may be amended
or modified from time to time with the consent of Seller and Purchaser.
"Plan Effective Date" shall mean the date on which the Plan
is consummated and becomes effective and binding in all material respects.
"Pre-Spin Services Agreement" shall mean the Administrative
Services Agreement by and between Seller and certain of its Subsidiaries on the
one hand, and Communications and certain of its Subsidiaries on the other hand,
dated September 30, 1999, as deferred pursuant to that certain letter agreement
dated April 23, 2001, and further deferred pursuant to that certain letter
agreement dated February 23, 2002.
"Pre-Spin Services Claims" has the meaning set forth in
Section 2.01(a)(ii).
"Property" shall mean all of the property covered by the
Master Lease Agreement, dated September 13, 2001 (including the building,
improvements, furniture and fixtures, and the parking garage, but excluding the
central plant.)
"Purchase Price" has the meaning set forth in Section 2.03.
"Purchaser" has the meaning set forth in the preamble
hereof.
"Reorganized Communications" shall mean any successor to
Communications under the Plan.
"SBC" shall mean SBC Communications Inc., a Delaware
corporation.
"Seller" has the meaning set forth in the preamble hereof.
"Senior Redeemable Notes" shall mean Communications' (i)
10.875% fixed rate notes due October 1, 2009, (ii) 10.70% fixed rate notes due
October 7, 2007, (iii) 11.70% fixed rate notes due August 1, 2008 and (iv)
11.875% fixed rate notes due August 1, 2010.
"Services Agreements" shall mean (i) the Amended and
Restated Administrative Services Agreement between Seller and certain of its
Subsidiaries on the one hand, and Communications and certain of its Subsidiaries
on the other hand, effective April 23, 2001, (ii) the Supplemental Terms and
Conditions to the Master Administrative Services Agreement between Seller and
certain of its Subsidiaries on the one hand, and Communications and certain of
5
its Subsidiaries on the other hand and (iii) the several related Service Level
Agreements set forth on Schedule 2.02(a).
"Subsidiary" shall mean, with respect to any Person, any
corporation or other organization, whether incorporated or unincorporated, of
which (a) at least a majority of the securities or other interests having by
their terms ordinary voting power to elect a majority of the Board of Directors
or others performing similar functions with respect to such corporation or other
organization is directly or indirectly owned or controlled by such Person or by
any one or more of its Subsidiaries, or by such Person and one or more of its
Subsidiaries or (b) such Person or any other Subsidiary of such Person is a
general partner (excluding any such partnership where such Person or any
Subsidiary of such party does not have a majority of the voting interest in such
partnership).
"Tax Sharing Agreement" shall mean the Tax Sharing
Agreement entered into as of September 30, 1999, by and between Seller and
Communications, as amended and restated as of April 23, 2001.
"Transactions" shall mean all the transactions provided for
or contemplated by this Agreement.
"Trust Note Indenture" shall mean the Indenture dated as of
March 28, 2001, among the Issuer, WCG Note Corp., Inc., a special purpose
corporation organized under the laws of the state of Delaware, as co-issuer of
8.25% Senior Secured Notes due 2004, and the Indenture Trustee.
"TWC Settlement Agreement" shall mean the agreement by and
among Seller, Debtors, the Committee and Purchaser compromising and settling
various disputes and issues between them and their respective Subsidiaries, a
true and correct copy of which is attached hereto as Exhibit D.
"TWC Settlement Order" shall mean the order of the
Bankruptcy Court, which may be the Confirmation Order, approving the TWC
Settlement Agreement, on terms that are acceptable to Purchaser and Seller.
"WCG" has the meaning set forth in the recitals hereof.
"WCG Bank Facility" shall mean the Amended and Restated
Credit Agreement dated as of September 8, 1999, as amended, among WCL, as
borrower, Communications, as guarantor, the Bank Agent, the Lenders, The Chase
Manhattan Bank, as syndication agent, Xxxxxxx Xxxxx Xxxxxx Inc. and Xxxxxx
Brothers, Inc., as joint lead arrangers and joint bookrunners with respect to
the Incremental Facility referred to therein, and Xxxxxxx Xxxxx Xxxxxx Inc.,
Xxxxxx Brothers, Inc. and Xxxxxxx Xxxxx & Co., Inc., as co-documentation agents.
"WCG Note" shall mean the $1.5 Billion 8.25% Senior Reset
Note due 2008 issued by Communications to the Issuer pursuant to the WCG Note
Indenture and the Participation Agreement (as defined in the Trust Note
Indenture).
6
"WCG Note Indenture" shall mean the Indenture dated as of
March 28, 0000, xxxxxxx Xxxxxxxxxxxxxx xxx Xxxxxx
Xxxxxx Trust Company of New York, a New York banking corporation, as trustee.
"WCL" has the meaning set forth in Section 2.01(a)(i).
"WTC" shall mean Xxxxxxxx Technology Center, LLC, a
Delaware limited liability company.
Section 1.02. Interpretation. When a reference is made in
this Agreement to a section, article, paragraph, exhibit or schedule, such
reference shall be to a section, article, paragraph, exhibit or schedule of this
Agreement unless clearly indicated to the contrary.
(a) Whenever the words "include", "includes" or "including"
are used in this Agreement they shall be deemed to be followed
by the words "without limitation."
(b) The words "hereof", "herein" and "herewith" and words of
similar import shall, unless otherwise stated, be construed to
refer to this Agreement as a whole and not to any particular
provision of this Agreement.
(c) The meaning assigned to each term defined herein shall be
equally applicable to both the singular and the plural forms
of such term, and words denoting any gender shall include all
genders. Where a word or phrase is defined herein, each of its
other grammatical forms shall have a corresponding meaning.
(d) A reference to any party to this Agreement or any other
agreement or document shall include such party's predecessors,
successors and permitted assigns.
(e) A reference to any legislation or to any provision of any
legislation shall include any amendment to, and any
modification or re-enactment thereof, any legislative
provision substituted therefor and all regulations and
statutory instruments issued thereunder or pursuant thereto.
(f) References to Dollars or $ are to United States Dollars.
ARTICLE II
SALE OF CLAIMS
Section 2.01. Sale of the Claims and the WCG Note. On the
terms, and subject to the conditions, set forth in this Agreement:
(a) Seller agrees to sell, assign, transfer and deliver to
Purchaser on the Closing Date and Purchaser agrees to purchase
from Seller on the Closing Date, all of Seller's right, title
and interest in and to the Claims against WCG identified as
follows:
(i) All Causes of Action of Seller, together with all
collateral therefor and proceeds thereof, arising
from Seller's guaranty of the obligations of Xxxxxxxx
Communications, LLC, a Delaware limited liability
7
company and a wholly owned Subsidiary of
Communications ("WCL"), under the Asset Defeasance
Program, the provision of other financial
accommodations in connection therewith and the
payment of WCL's obligations thereunder pursuant to
the agreements set forth on Schedule 2.01(a)(i) (the
"ADP Claims"); and
(ii) All Causes of Action of Seller, together with
all collateral therefor and proceeds thereof, arising
from the Pre-Spin Services Agreement (the "Pre-Spin
Services Claims").
(b) Seller, in its capacity as agent of the Indenture Trustee
under the Trust Note Indenture, agrees to sell, assign,
transfer and deliver to Purchaser on the Closing Date and
Purchaser agrees to purchase from Seller (in its capacity as
agent of the Indenture Trustee under the Trust Note Indenture)
on the Closing Date, all of the Issuer's right, title and
interest in and to the WCG Note.
Section 2.02. Excluded Claims. It is expressly understood
and agreed that the Claims shall not include any other claims or assets,
including, without limitation, the Causes of Action of Seller and its Affiliates
under the following agreements (the "Excluded Claims"):
(a) the Services Agreements;
(b) the Tax Sharing Agreement;
(c) the Amended and Restated Employee Benefits Agreement with
WCG, dated April 23, 2001;
(d) the Trademark License Agreement and the Cross-License
Agreement, both effective as of April 23, 2001 between Seller
and WCG; and
(e) the Relocation Services Agreement with WCG, effective as
of January 2, 2002.
Section 2.03. Closing Payment. In consideration for the
purchase by Purchaser of the Claims and the WCG Note, on the Closing Date
Purchaser shall pay to Seller (or such other party or parties as Seller shall
direct) One Hundred Eighty Million Dollars ($180,000,000) in the aggregate (the
"Purchase Price") in cash.
Section 2.04. Closing. The sales referred to in Section
2.01 (the "Closing") shall take place at 10:00 A.M., New York time, at the
offices of White & Case LLP, 0000 Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, Xxx Xxxx
00000, simultaneously with the satisfaction or waiver of all of the conditions
set forth in Article V hereof, or at such other time and date as Seller and
Purchaser shall agree ("Closing Date").
Section 2.05. Deliveries by Seller. At the Closing, Seller
shall deliver or cause to be delivered to Purchaser (unless previously
delivered), the following:
(a) a duly executed Claims Assignment;
8
(b) the WCG Note, with an attached Transfer Notice in favor of
Purchaser duly executed by the Issuer Trustee on behalf of the
Issuer; and
(c) all other previously undelivered documents required by
this Agreement to be delivered by Seller to Purchaser at or
prior to the Closing in connection with the Transactions.
Section 2.06. Deliveries by Purchaser. At the Closing,
Purchaser shall deliver to Seller (unless previously delivered), the following:
(a) the Purchase Price by wire transfer of immediately
available funds to the account or accounts identified by
Seller at least two Business Days prior to the Closing Date;
(b) a duly executed Claims Assignment; and
(c) all other previously undelivered documents required by
this Agreement to be delivered by Purchaser to Seller at or
prior to the Closing in connection with the Transactions.
Section 2.07. Purchase Price Allocation. Seller and
Purchaser agree to allocate the Purchase Price to be paid for the Claims and the
WCG Note as follows:
(a) One Hundred Eleven Million Seven Hundred Seventy Five
Thousand Five Hundred Fifty Six Dollars and Seventy Three
Cents ($111,775,556.73) for the WCG Note;
(b) Sixty Million Thirty Nine Thousand Six Hundred Fifty Five
Dollars and Eighty Cents ($60,039,655.80) for the ADP Claims;
and
(c) Eight Million One Hundred Eighty Four Thousand Seven
Hundred Eighty Seven Dollars and Forty Seven Cents
($8,184,787.47) for the Pre-Spin Services Claims.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
Section 3.01. Representations of Seller. Seller represents
and warrants to Purchaser as follows:
(a) Seller is a corporation duly organized, validly existing
and in good standing under the laws of the state of Delaware;
(b) Seller has the requisite power and authority to execute
and deliver this Agreement and any other agreements or
instruments contemplated by this Agreement to be executed by
it and to perform its obligations hereunder and thereunder,
including, without limitation, to act as agent of the
Indenture Trustee under the Trust Note Indenture with respect
to the sale of the WCG Note;
9
(c) This Agreement has been duly executed and delivered by
Seller and constitutes the valid and binding obligation of
Seller, enforceable against Seller in accordance with its
terms, subject to the effects of bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium, and other
similar laws relating to or affecting creditors' rights
generally, general equitable principles (whether considered in
a proceeding in equity or at law) and an implied covenant of
good faith and fair dealing;
(d) When executed and delivered as provided in this Agreement,
each other agreement and instrument contemplated hereby to be
executed by Seller will be a valid and binding obligation of
Seller, enforceable against Seller in accordance with its
terms, subject to the effects of bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium, and other
similar laws relating to or affecting creditors' rights
generally, general equitable principles (whether considered in
a proceeding in equity or at law) and an implied covenant of
good faith and fair dealing;
(e) None of the execution and delivery of this Agreement or
the other agreements and instruments contemplated by this
Agreement to be executed by Seller, the consummation by Seller
of the Transactions or compliance by Seller with any of the
provisions hereof or thereof will (i) conflict with or
constitute a breach of or default under any of Seller's
charter or bylaws, (ii) result in a violation or breach of, or
constitute (with or without notice or lapse of time or both) a
default (or give rise to any third-party right of termination,
cancellation, material modification or acceleration) under,
any note, loan agreement, bond, mortgage, indenture, license,
contract, commitment, arrangement, understanding, agreement or
other instrument or obligation of any kind (including any of
the foregoing relating to the Claims or the WCG Note) to which
Seller is a party or by which Seller or any of its properties
or assets may be bound, (iii) violate any order, writ,
injunction, decree, judgment, statute, rule or regulation
applicable to Seller or any of its properties or assets or
(iv) require any order, consent, approval or authorization of,
or notice to, or declaration, filing, application,
qualification or registration with, any Governmental Entity,
except with respect to the foregoing clauses (ii)-(iv), as
would not, individually or in the aggregate, reasonably be
expected to have a material adverse effect on the ability of
Seller to consummate the Transactions;
(f) As of the Closing Date, and upon the assignment and
assumption of the Claims and the transfer of the WCG Note, (i)
Seller will have transferred to Purchaser all of Seller's
right, title and interest in and to the Claims and (ii)
Seller, in its capacity as agent of the Indenture Trustee
under the Trust Note Indenture, will have transferred to
Purchaser all of the Issuer's right, title and interest in and
to the WCG Note;
(g) As of April 22, 2002, (i) the ADP Claims had a nominal
value of Seven Hundred Fifty Three Million Eight Hundred Sixty
Seven Thousand One Hundred and Twenty Eight Dollars and Fifty
Cents ($753,867,128.50), plus the right to accrued and unpaid
interest; (ii) the Pre-Spin Services Claims had a nominal
value of One Hundred Eight Million Two Hundred Fifty Thousand
Dollars ($108,250,000), plus the right to accrued and unpaid
interest; and (iii) the WCG Note had a face value of One
Billion Five Hundred Million Dollars ($1,500,000,000);
10
(h) Correct and complete copies of all of the material Claims
Documents and material Note Documents have been delivered to
Purchaser prior to the date hereof;
(i) No broker, finder or other Person acting under Seller's
authority is entitled to any broker's commission or other fee
in connection with the Transactions for which Purchaser could
be responsible; and
(j) Except for the representations and warranties contained in
this Section 3.01, neither Seller nor any other Person makes
any other express or implied representation or warranty to
Purchaser.
Section 3.02. Representations of Purchaser. Purchaser
hereby represents and warrants to Seller as follows:
(a) Purchaser is a corporation duly organized, validly
existing and in good standing under the laws of the state of
New York;
(b) Purchaser has the requisite power and authority to execute
and deliver this Agreement and any other agreements or
instruments contemplated by this Agreement to be executed by
Purchaser and to perform its obligations hereunder and
thereunder;
(c) This Agreement has been duly executed and delivered by
Purchaser and this Agreement constitutes the valid and binding
obligation of Purchaser, enforceable against Purchaser in
accordance with its terms subject to the effects of
bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other similar laws relating to or affecting
creditors' rights generally, general equitable principles
(whether considered in a proceeding in equity or at law) and
an implied covenant of good faith and fair dealing;
(d) When executed and delivered as provided in this Agreement,
each other agreement and instrument contemplated hereby to be
executed by Purchaser will be a valid and binding obligation
of Purchaser, enforceable against Purchaser in accordance with
its terms, subject to the effects of bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium, and other
similar laws relating to or affecting creditors' rights
generally, general equitable principles (whether considered in
a proceeding in equity or at law) and an implied covenant of
good faith and fair dealing;
(e) None of the execution and delivery of this Agreement and
any other agreements or instruments contemplated by this
Agreement to be executed by Purchaser, nor the consummation by
Purchaser of the Transactions or compliance by Purchaser with
any of the provisions hereof or thereof will (i) conflict with
or constitute a breach of or default under any of its charter
or bylaws, (ii) result in a violation or breach of, or
constitute (with or without notice or lapse of time or both) a
default (or give rise to any third party right of termination,
cancellation, material modification or acceleration) under,
any note, loan agreement, bond, mortgage, indenture, license,
contract, commitment, arrangement, understanding, agreement or
other instrument or obligation of any kind to which Purchaser
is a party or by which Purchaser or any of its properties or
assets may be bound, (iii) violate any order, writ,
11
injunction, decree, judgment, statute, rule or regulation
application to Purchaser or any of its properties or assets or
(iv) except for applicable requirements of the HSR Act,
require any order, consent, approval or authorization of, or
notice to, or declaration, filing, application, qualification
or registration with, any Governmental Entity, except with
respect to the foregoing clauses (ii)-(iv) as would not,
individually or in the aggregate, reasonably be expected to
have a material adverse effect on the ability of Purchaser to
consummate the Transactions;
(f) Purchaser (i) is a sophisticated Person with respect to
the purchase of the Claims and the WCG Note, (ii) is able to
bear the economic risk associated with the purchase of the
Claims and the WCG Note, (iii) has adequate information
concerning the business and financial condition of the Debtors
and the status of the Bankruptcy Case to make an informed
decision regarding the purchase of the Claims and the WCG
Note, (iv) has such knowledge and experience, and has made
investments of a similar nature, so as to be aware of the
risks and uncertainties inherent in the purchase of rights and
assumption of liabilities of the type contemplated in this
Agreement and (v) has independently and without reliance upon
Seller, and based on such information as Purchaser has deemed
appropriate, made its own analysis and decision to enter into
this Agreement, except that Purchaser has relied upon Seller's
express representations and warranties in this Agreement.
Purchaser acknowledges that Seller has not given Purchaser any
investment advice, credit information or opinion on whether
the purchase of the Claims and the WCG Note is prudent;
(g) No broker, finder or other Person acting under Purchaser's
authority is entitled to any broker's commission or other fee
in connection with the Transactions for which Seller could be
responsible;
(h) Purchaser has and will have on the Closing Date sufficient
funds available to it to pay the Purchase Price and all
contemplated fees and expenses of Purchaser related to the
Transactions; and
(i) Except for the representations and warranties contained in
this Section 3.02, neither Purchaser nor any other Person
makes any other express or implied representation or warranty
to Seller.
Section 3.03. Survival. All the representations and
warranties of Seller and Purchaser set forth in this Article III shall survive
the Closing.
ARTICLE IV
COVENANTS AND AGREEMENTS
Section 4.01. February 23, 2002 Letter. Purchaser hereby
agrees to be bound by Seller's obligations under the Letter Agreement dated
February 23, 2002, between Seller and WCG (the "February 23 Agreement"),
including, without limitation, paragraphs 1 and 4(e) thereof, with respect to
the Claims, the WCG Note and the Excluded Claims.
Section 4.02. Communications Investment. Purchaser agrees
to use its commercially reasonable best efforts to satisfy the terms and
conditions of the Investment Agreement.
12
Section 4.03. No Shop. During the period from the date of
this Agreement to the earlier of (i) the Closing Date and (ii) the date this
Agreement is terminated, Seller and its Subsidiaries shall not, and shall use
their reasonable best efforts to cause each of their respective directors,
officers and agents (including, financial advisors) not to (i) directly or
indirectly, initiate or solicit proposals or offers from any Person, other than
Purchaser (and its Affiliates and representatives), relating to any acquisition
or purchase of all or a portion of the Claims or the WCG Note or (ii)
participate in any negotiations or furnish any information with respect to, or
facilitate any effort or attempt by any other Person to do or seek any of the
foregoing.
Section 4.04. Impairment. (a) Seller covenants and agrees
that from and after the date of this Agreement Seller shall not, and shall cause
its Affiliates not to, knowingly take any action or fail to take action that
could reasonably be expected to (i) impair materially the Claims or the WCG Note
or (ii) adversely affect in a material way the Plan; and
(b) Purchaser covenants and agrees that from and after the
date of this Agreement, Purchaser shall not, and shall cause its Affiliates not
to, knowingly take any action or fail to take action that could reasonably be
expected to (i) impair materially the Excluded Claims or (ii) adversely affect
in a material way the Plan.
Section 4.05. Purchaser Support of Plan and TWC Settlement
Agreement. (a) To the extent Purchaser is or becomes a creditor of the Debtors,
or otherwise has standing in the Bankruptcy Case, Purchaser shall (i) support
and not oppose, the Plan, (ii) use commercially reasonable efforts to obtain as
expeditiously as possible, the confirmation and consummation of the Plan and
(iii) support the approval by the Bankruptcy Court of the TWC Settlement
Agreement and use commercially reasonable efforts to obtain entry of the TWC
Settlement Order.
(b) Purchaser shall use commercially reasonable efforts to
(1) cause the Plan and a disclosure statement with respect to the Plan (the
"Disclosure Statement") to be filed with the Bankruptcy Court as expeditiously
as practicable, (2) seek to obtain entry of an order approving the Disclosure
Statement as containing "adequate information" as required by section 1125 of
the Bankruptcy Code as expeditiously as possible, (3) facilitate the
solicitation of votes on the Plan, (4) obtain entry of the Confirmation Order,
and (5) cause the Plan Effective Date to occur on or before February 28, 2003.
(c) Regardless of whether the Purchaser is a creditor of
the Debtors or is a proponent of the Plan, Purchaser shall not (1) object to the
Plan, (2) vote against the Plan, (3) take any action that would delay the
confirmation and consummation of the Plan, (4) solicit, encourage, entertain, or
engage in any inquiries, discussions, offers, proposals, or enter into any
agreements, arrangement or understandings, relating to any other chapter 11 plan
with respect to the Debtors or any transaction involving the Debtors or their
assets that is inconsistent with the Plan and the transactions contemplated
hereby, (5) consent to, support or participate in the formulation of any chapter
11 plan for the Debtors other than the Plan, (6) encourage or support in any
fashion any Person to vote against or object to the Plan, or (7) take any action
directly or indirectly for the purpose of delaying, preventing, frustrating or
impeding acceptance, confirmation and consummation of the Plan.
13
Section 4.06. Seller Support of Plan. (a) Seller shall
support and not oppose, the Plan, and shall use commercially reasonable efforts
to obtain as expeditiously as possible, the confirmation and consummation of the
Plan.
(b) Seller shall not (1) object to the Plan, (2) vote
against the Plan, (3) take any action that would delay the confirmation and
consummation of the Plan, (4) solicit, encourage, entertain, or engage in any
inquiries, discussions, offers, proposals, or enter into any agreements,
arrangement or understandings, relating to any other chapter 11 plan with
respect to the Debtors or any transaction involving the Debtors or their assets
that is inconsistent with the Plan and the transactions contemplated hereby, (5)
consent to, support or participate in the formulation of any chapter 11 plan for
the Debtors other than the Plan, (6) encourage or support in any fashion any
Person to vote against or object to the Plan, or (7) take any action directly or
indirectly for the purpose of delaying, preventing, frustrating or impeding
acceptance, confirmation and consummation of the Plan.
Section 4.07. Voting. Until the Closing Date, Seller shall
have sole authority to exercise all voting and other rights and remedies with
respect to the Claims, the WCG Note (in its capacity as agent of the Indenture
Trustee under the Trust Note Indenture) and the Plan, and Purchaser shall have
no right to act as agent for Seller in respect of any matter relating to the
Claims, the WCG Note or the Plan; provided, that Seller agrees not to exercise
such voting and other rights and remedies in a manner inconsistent with the
terms of this Agreement; and provided, further, that to the extent practicable,
prior to exercising any such voting or other rights or remedies, Seller shall
notify Purchaser of any such proposed exercise.
Section 4.08. Seller Rights. Except as specifically
provided in this Agreement, nothing shall restrict the right, power or ability
of Seller to take any action it deems necessary or appropriate to protect its
interests, including, without limitation, with respect to any Causes of Action
that (i) WCG or any other Person may have against Seller or any of its
Affiliates, or (ii) relate to the Claims or the WCG Note.
Section 4.09. Non-assumption of Liabilities. It is
expressly agreed that Purchaser is not assuming any of Seller's obligations or
liabilities to WCG as a result of the Transactions.
Section 4.10. Condition of Claims and WCG Note. PURCHASER
AGREES THAT THE CLAIMS AND THE WCG NOTE BEING SOLD HEREUNDER ARE BEING SOLD
WITHOUT ANY WARRANTY OR REPRESENTATION WHATSOEVER (EXPRESS OR IMPLIED), EXCEPT
AS SPECIFICALLY STATED HEREIN AND THAT, EXCEPT FOR SUCH REPRESENTATIONS AND
WARRANTIES, THE SALE OF THE CLAIMS BY SELLER AND OF THE WCG NOTE BY SELLER IN
ITS CAPACITY AS AGENT OF THE INDENTURE TRUSTEE UNDER THE TRUST NOTE INDENTURE TO
PURCHASER IS MADE ON AN "AS IS, WHERE IS" BASIS, WITH ALL DEFECTS AND
IMPAIRMENTS OF ANY KIND OR NATURE, WHETHER KNOWN OR UNKNOWN, MATURE OR LATENT,
WHICH MAY AFFECT THE AMOUNT, PRIORITY, VALIDITY, ENFORCEABILITY, ALLOWABILITY OR
RECOVERY OF SUCH CLAIMS OR THE WCG NOTE IN THE BANKRUPTCY CASE (INCLUDING,
WITHOUT LIMITATION, THE AMOUNT OF EQUITY RECEIVED UNDER THE PLAN) OR OTHERWISE;
SELLER MAKES NO REPRESENTATION OR WARRANTY OF ANY KIND, IN EITHER ITS INDIVIDUAL
14
CAPACITY OR ITS CAPACITY AS AGENT OF THE INDENTURE TRUSTEE UNDER THE TRUST NOTE
INDENTURE, REGARDING THE AMOUNT, VALIDITY, ENFORCEABILITY OR ALLOWABILITY OF THE
CLAIMS OR THE WCG NOTE, AND PURCHASER ASSUMES ALL RISKS WITH RESPECT THERETO
(AND SHALL HAVE NO RIGHT, CLAIM, CAUSE OF ACTION OR REMEDY AGAINST SELLER
THEREFOR).
Section 4.11. Make-Whole Provision. (a) Purchaser hereby
agrees that, if within one year of the Closing Date, Purchaser or any of its
Affiliates directly or indirectly sells, exchanges or disposes of (or enters
into an agreement or agreements with respect thereto) the Claims and/or the WCG
Note or any consideration received in exchange therefor pursuant to a chapter 11
plan with respect to Communications (including, without limitation, any equity
or debt security of any Person (the "Claims Exchange Consideration")), or
receives a divided, payment or similar distribution from Communications,
Reorganized Communications, any of their respective Subsidiaries or any
successors thereof as a consequence of a sale of assets of, or transaction
involving, Communications, Reorganized Communications, any of their respective
Subsidiaries or any successors thereof (or enters into an agreement or
agreements with respect thereto) resulting in an aggregate payment to Purchaser
and/or its Affiliates of greater than One Hundred Eighty Million Dollars
($180,000,000) (it being expressly agreed that Fifty Four and Fifty Four
Hundredths Percent (54.54%) of (i) the proceeds of each sale, exchange or other
disposition by Purchaser and/or any of its Affiliates of any equity or debt
security of any Person received by Purchaser and/or any of its Affiliates during
such year in conjunction with or pursuant to a chapter 11 plan with respect to
Communications and (ii) each dividend, payment or similar distribution received
by Purchaser from Communications, Reorganized Communications, any of their
respective Subsidiaries or any successors thereof during such year as a
consequence of a sale of assets of, or transaction involving, Communications,
Reorganized Communications or any of their respective Subsidiaries or any
successors thereof, shall be allocated to the Claims Exchange Consideration for
purposes of determining any payment(s) due Seller under this Section 4.11),
Purchaser shall, within three (3) Business Days of the consummation of such
transaction, pay to Seller in immediately available funds (except as provided in
Section 4.11(b)) to an account designated by Seller in writing, an amount equal
to the product of (x) Fifty Percent (50%) multiplied by (y) the excess of the
aggregate payment over One Hundred Eighty Million Dollars ($180,000,000);
provided, that such payment shall be allocated pro rata among the Claims and the
WCG Note in proportion to their allocated portion of the Purchase Price in
Section 2.07; and, provided, further, that with respect to the portion of such
payment attributable to the WCG Note or any consideration received in exchange
therefor pursuant to a chapter 11 plan with respect to Communications, Seller
will receive such payment in its capacity as the agent of the Indenture Trustee
under the Trust Note Indenture. Purchaser agrees that it will notify Seller in
writing within three (3) Business Days of entering into a transaction or
agreement of the type set forth in this Section 4.11.
(b) In the event the consideration received or to be
received by Purchaser in a transaction of the type set forth in Section 4.11(a)
is to be paid in whole or in part other than in Dollars, for purposes of Section
4.11(a), the value of such consideration shall be mutually agreed between
Purchaser and Seller. Notwithstanding anything in this Agreement to the
contrary, in the event Purchaser receives non-Dollar consideration in a
transaction of the type set forth in Section 4.11(a), unless otherwise agreed
between Purchaser and Seller in accordance with the previous sentence, any
15
payment by Purchaser to Seller under Section 4.11(a) shall be made pro rata
(based on the amount of non-Dollar consideration relative to the amount of
Dollar consideration received by Purchaser in such transaction(s)) in such
non-Dollar consideration.
Section 4.12. HSR Act. Purchaser agrees to cause to be made
all appropriate filings under the HSR Act with respect to the Transactions as
soon as reasonably practicable after the date of this Agreement and to
diligently pursue termination of the waiting period under the HSR Act.
Section 4.13. Covenant to Satisfy Conditions. Each party
hereto agrees to use all commercially reasonable best efforts to insure that the
conditions set forth in Article V hereof are satisfied, insofar as such matters
are within the control of such party.
Section 4.14. Further Assurances. Each party shall execute
and deliver such other documents and instruments and take such further actions,
as may be reasonably required by the other party in order to consummate the
Transactions contemplated hereby.
ARTICLE V
CONDITIONS PRECEDENT
Section 5.01. Conditions to Purchaser's Obligation to
Effect the Closing. The obligation of Purchaser to consummate the Closing shall
be subject to the satisfaction on or prior to the Closing Date of each of the
following conditions, unless validly waived in writing by Purchaser:
(a) Representations and Warranties. All of the representations
and warranties of Seller set forth in this Agreement that are
qualified as to materiality shall be true and correct and any
such representations and warranties that are not so qualified
shall be true and correct in all material respects, in each
case as of the date hereof and as of the Closing Date, other
than representations and warranties that speak as of a
specific date or time (which need only be so true and correct
as of such date or time).
(b) Seller's Performance of Covenants. Seller shall not have
failed to perform in any material respect any obligation or to
comply in any material respect with any agreement or covenant
of Seller to be performed or complied with by it under this
Agreement.
(c) Injunctions. On the Closing Date, there shall not be any
injunction, writ, preliminary restraining order or other order
in effect of any nature issued by a Governmental Entity of
competent jurisdiction that restrains, prohibits or limits, in
whole or in material part, the consummation of the
Transactions.
(d) HSR Act. The applicable waiting period under the HSR Act
with respect to the Transactions shall have expired or been
terminated.
(e) SBC Consent. SBC (on behalf of itself and its Affiliates)
shall have consented to (i) the April 23, 2001 transactions
pursuant to which the stock in WCG held by Seller was
16
dividended to Seller's shareholders and (ii) the transactions
contemplated by the Plan and the Investment Agreement, such
consents to be in form and substance reasonably satisfactory
to Purchaser, with Purchaser's approval not to be unreasonably
withheld or delayed, provided, however, that this condition
may be satisfied as to any of clauses (i) or (ii) if Purchaser
seeks or directs Communications to seek and, subsequently, a
court of competent jurisdiction shall have entered an order
reasonably satisfactory to Purchaser providing that SBC does
not have and will not have a right to terminate the Master
Alliance Agreement between SBC and WCL, dated February 12,
1999 by reason of the transactions contemplated by clauses (i)
or (ii), as applicable.
(f) Closing Deliveries. Seller shall have made all closing
deliveries to Purchaser as set forth in Section 2.05.
(g) Confirmation of Plan. The Bankruptcy Court shall have
entered an order (the "Confirmation Order"), confirming the
Plan, which shall have become a Final Order, and the Plan
shall have been consummated and become effective and binding
on WCG and all creditors, interest holders and parties in
interest.
The foregoing conditions are for the sole benefit of Purchaser and may be waived
by Purchaser, in whole or in part, at any time and from time to time in its sole
discretion.
Section 5.02. Conditions to Seller's Obligation to Effect
the Closing. The obligation of Seller to consummate the Closing shall be subject
to the satisfaction on or prior to the Closing Date of each of the following
conditions, unless waived in writing by Seller:
(a) Representations and Warranties. All of the representations
and warranties of Purchaser set forth in this Agreement that
are qualified as to materiality shall be true and correct and
any such representations and warranties that are not so
qualified shall be true and correct in all material respects,
in each case as of the date hereof and as of the Closing Date,
other than representations and warranties that speak as of a
specific date or time (which need only be so true and correct
as of such date or time).
(b) Purchaser's Performance of Covenants. Purchaser shall not
have failed to perform in any material respect any obligation
or to comply in any material respect with any agreement or
covenant to be performed or complied with by it under this
Agreement.
(c) Injunctions. On the Closing Date, there shall not be any
injunction, writ, preliminary restraining order or other order
in effect of any nature issued by a Governmental Entity of
competent jurisdiction that restrains, prohibits or limits, in
whole or in material part, the consummation of the
Transactions.
(d) Communications Investment. Purchaser shall have
consummated the Communications Investment concurrently with
the Closing.
(e) Closing Deliveries. Purchaser shall have made all closing
deliveries to Seller as set forth in Section 2.06.
17
(f) Confirmation Order. The Bankruptcy Court shall have
entered the Confirmation Order (which shall be reasonably
satisfactory to Seller), which shall have become a Final
Order, and the Plan (and all of the transactions contemplated
thereby) shall have been consummated and become effective and
binding on WCG and all creditors, interest holders and parties
in interest.
(g) Building Purchase. The Building Purchase shall have been
consummated or shall be consummated concurrently with the
Closing.
(h) Settlement Order. The TWC Settlement Order shall have
become a Final Order and all of the transactions contemplated
thereby shall have been consummated.
The foregoing conditions are for the sole benefit of Seller and may be waived by
Seller, in whole or in part, at any time and from time to time in its sole
discretion.
ARTICLE VI
TERMINATION
Section 6.01. Termination. This Agreement may be terminated
or abandoned at any time prior to the Closing Date:
(a) By the mutual written consent of Purchaser and Seller;
(b) By Purchaser or Seller if any Governmental Entity with
jurisdiction over the subject matter of this Agreement shall
have issued an order, decree or ruling or taken any other
action restraining, enjoining or otherwise prohibiting in
whole or in material part the consummation of the Transactions
and such order, decree, ruling or other action shall have
become a Final Order;
(c) By Purchaser or Seller if the Bankruptcy Court denies
approval of the TWC Settlement Agreement, or, in any event, if
the TWC Settlement Order is not entered by October 15, 2002;
(d) By Purchaser or Seller in the event of a material breach
of this Agreement by the other party, which breach shall be
incapable of being cured or, if capable of being cured, shall
not have been cured within thirty (30) days following receipt
by the breaching party from the other party of written notice
of such breach (specifying in reasonable detail the claimed
breach and demand of its cure);
(e) By Seller in the event any of the conditions set forth in
Section 5.02 becomes incapable of being satisfied on or before
February 28, 2003; and
(f) By Purchaser or Seller if the Closing has not occurred on
or before February 28, 2003; unless the failure of such
consummation shall be due to the failure of such party to
comply in all material respects with the representations,
warranties, agreements and covenants contained herein or to be
performed by such party on or prior to February 28, 2003.
18
Section 6.02. Effect of Termination. In the event of the
termination or abandonment of this Agreement by any party hereto pursuant to the
terms of this Agreement, written notice thereof shall forthwith be given to the
other party specifying the provision hereof pursuant to which such termination
or abandonment of this Agreement is made, and there shall be no liability or
obligation thereafter on the part of Purchaser or Seller except (A) as set forth
in Section 6.03, (B) for fraud and (C) for willful breach of this Agreement
prior to such termination or abandonment of the Transactions.
Section 6.03. Liquidated Damages. In the event of the
termination by Purchaser of this Agreement pursuant to Section 6.01(d) (provided
that Purchaser is not then in material breach of this Agreement), Seller shall,
within three (3) Business Days of such termination, pay to Purchaser in
immediately available funds to an account designated by Purchaser in writing
Five Million Dollars ($5,000,000). The parties hereto expressly acknowledge and
agree that, in light of the difficulty of accurately determining actual damages
with respect to the foregoing upon any termination of this Agreement where a fee
is or may become payable in accordance with this Section 6.03, the right to
payment: (i) constitutes a reasonable estimate of the damages that will be
suffered by reason of any such proposed or actual termination of this Agreement,
and (ii) shall be in full and complete satisfaction of any and all damages
arising from the foregoing.
ARTICLE VII
MISCELLANEOUS
Section 7.01. Expenses. All costs and expenses incurred in
connection with this Agreement and the consummation of the Transactions shall be
paid by the party incurring such expenses, except as specifically provided to
the contrary in this Agreement.
Section 7.02. Extension; Waiver. At any time prior to the
Closing, each of the parties hereto may (i) extend the time for the performance
of any of the obligations or acts of any other party hereto, (ii) waive any
inaccuracies in the representations and warranties of any other party contained
herein or in any document delivered pursuant hereto, (iii) waive compliance with
any of the agreements of the other party contained herein, or (iv) waive any
condition to its obligations hereunder. Any agreement on the part of a party
hereto to any such extension or waiver shall be valid only if set forth in a
written instrument signed on behalf of such party.
Section 7.03. Transfer Taxes. In accordance with Section
1146(c) of the Bankruptcy Code, the instruments transferring the Claims and the
WCG Note to Purchaser shall contain the following endorsement:
"Because this [instrument] has been authorized pursuant to
Order of the United States Bankruptcy Court for the Southern District of New
York relating to a chapter 11 plan of Xxxxxxxx Communications Group, Inc. and
the order of the Xxxxxxxxx Xxxxxx X. Xxxxxxx, United States Bankruptcy Judge, it
is exempt from transfer taxes, stamp taxes or similar taxes pursuant to 11
U.S.C. ss. 1146(c)."
Section 7.04. Notices. All notices and other communications
hereunder shall be in writing and shall be deemed given when mailed, delivered
personally, telecopied (which is confirmed) or sent by an overnight courier
19
service, such as Federal Express, to the parties at the following addresses (or
at such other address for a party as shall be specified by such party by like
notice):
if to Purchaser to:
Leucadia National Corporation
000 Xxxx Xxxxxx Xxxxx
Xxx Xxxx, XX 00000 Attention:
Facsimile:
with a copy (which shall not constitute notice) to:
Xxxxxxx Xxxx & Xxxxx LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxx X. Xxxx, Esq.
Xxxxxxx X. Xxxxxxxxxx, Esq.
Facsimile: (000) 000-0000
if to Seller to:
The Xxxxxxxx Companies, Inc.
Xxx Xxxxxxxx Xxxxxx
Xxxxx, XX 00000
Attention: Xxxxxxx xxx Xxxxx, Esq.
Xxxxx Xxxxx, Esq.
Facsimile: (000) 000-0000
with a copy (which shall not constitute notice) to:
White & Case LLP
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxx Xxxxx, Esq.
Facsimile: (000) 000-0000
and
White & Case LLP
First Union Financial Center
000 Xxxxx Xxxxxxxx Xxxxxxxxx
Xxxxx, XX 00000-0000
Attention: Xxxxxx X Xxxxxx, Esq.
Facsimile: (000) 000-0000
20
or to such other address, telecopier number or person's
attention as a party may from time to time designate in writing in accordance
with this Section. Each notice or other communication given to any party hereto
in accordance with the provisions of this Agreement shall be deemed to have been
received (a) on the Business Day it is sent, if sent by personal delivery or
telecopied, or (b) on the first Business Day after sending, if sent by overnight
delivery, properly addressed and prepaid or (c) upon receipt, if sent by mail
(regular, certified or registered); provided, however, that notice of change of
address shall be effective only upon receipt. The parties agree that delivery of
process or other papers in connection with any action or proceeding in
connection with this Agreement in the manner provided in this Section 7.04, or
in such other manner as may be permitted by Applicable Law, shall be valid and
sufficient service thereof.
Section 7.05. Entire Agreement; Amendment. This Agreement,
the Confidentiality Agreement and other schedules and exhibits hereto constitute
the entire agreement and supersede all prior agreements and understandings, both
written and oral, among the parties with respect to the subject matter hereof
and thereof and supersede and cancel all prior agreements, negotiations,
correspondence, undertakings, understandings and communications of the parties,
oral and written, with respect to the subject matter hereof. This Agreement may
only be modified or amended by a written instrument executed by the parties
hereto. Section 7.06. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York (without giving
effect to the provisions thereof relating to conflicts of law).
Section 7.07. Jurisdiction. Purchaser and Seller each
hereby irrevocably and unconditionally submit to the nonexclusive jurisdiction
of any New York State court or Federal court of the United States of America
sitting in New York City, and any appellate court from any thereof, but solely
in any action or proceedings to enforce this Agreement. Each of the parties
hereto agrees that a final judgment in any such action or proceeding will be
conclusive and may be enforced in other jurisdictions by suit on the judgment or
in any other manner provided by law.
Section 7.08. Counterparts. This Agreement may be executed
in any number of counterparts and by different parties hereto in separate
counterparts and by facsimile, with the same effect as if all parties had signed
the same document. All such counterparts are to be deemed an original, construed
together and constitute one and the same instrument.
Section 7.09. Severability. Any term or provision of this
Agreement that is invalid or unenforceable in any jurisdiction, will, as to that
jurisdiction, be ineffective to the extent of such invalidity or
unenforceability without rendering invalid or unenforceable the remaining terms
and provisions of this Agreement or affecting the validity or enforceability of
any of the terms or provisions of this Agreement in any other jurisdiction. If
any provision of this Agreement is so broad as to be unenforceable, the
provision will be interpreted to be only so broad as is enforceable.
Section 7.10. Headings. The headings of the paragraphs of
this Agreement are inserted for convenience only and not to affect the
interpretation hereof.
21
Section 7.11. Assignment. Neither this Agreement nor the
rights or the obligations of any party hereto are assignable in whole or in part
(whether by operation of law or otherwise), without the written consent of the
other party and any attempt to do so in contravention of this Section 7.11 will
be void; except that Purchaser may assign any or all of its rights (but not its
obligations) hereunder to any Affiliate of Purchaser; provided, that no such
assignment shall relieve Purchaser of its obligations hereunder.
Section 7.12. Successors and Assigns. This Agreement,
including the representations, warranties and covenants contained in this
Agreement, shall inure to the benefit of, be binding upon and be enforceable by
and against the parties and their respective successors and permitted assigns.
Section 7.13. No Third-Party Beneficiaries. This Agreement
is solely for the benefit of the parties hereto, their respective successors and
permitted assigns, and the Persons identified as beneficiaries herein.
Section 7.14. Publicity. The parties agree that until the
Plan Effective Date, or the date the Transactions are terminated or abandoned
pursuant to Article VI, neither Seller nor Purchaser nor any of their respective
Affiliates, shall issue or cause the publication of any press release or other
public announcement with respect to this Agreement or the Transactions or the
Plan without prior consultation with the other(s), except as may be (a) required
by Applicable Law, which shall include such filings and/or statements as any
party shall determine to be necessary or advisable in its reasonable judgment in
order to comply with its obligations under the Securities Exchange Act of 1934,
as amended, or (b) appropriate to the Debtors' administration of the Bankruptcy
Case.
22
IN WITNESS WHEREOF, Seller and Purchaser have executed this
Purchase and Sale Agreement by their duly authorized officers as of the date
first set forth above.
THE XXXXXXXX COMPANIES, INC.
By: /s/ Xxxx X. XxXxxxxx
---------------------------------------
Name: Xxxx X. XxXxxxxx
Title: Senior Vice President - Finance
Chief Financial Officer
LEUCADIA NATIONAL CORPORATION
By: /s/ Xxxxxxx X. Xxxxxxxxx
---------------------------------------
Name: Xxxxxxx X. Xxxxxxxxx
Title: Vice President
23
EXHIBIT A
PLAN
EXHIBIT B
FORM OF CLAIMS ASSIGNMENT
EXHIBIT C
INVESTMENT AGREEMENT
EXHIBIT D
TWC SETTLEMENT AGREEMENT
