EXHIBIT J
AMERICAN COMMUNICATIONS SERVICES, INC.
Units consisting of
14-3/4% Redeemable Preferred Stock due 2008
and
Warrants to Purchase Shares of Common Stock
PURCHASE AGREEMENT
July 10, 1997
To the Purchasers Listed
on Schedule 1 hereto
Ladies and Gentlemen:
American Communications Services, Inc. (the "Company"),
a Delaware corporation, hereby confirms its agreement with the
persons listed on Schedule 1 hereto (the "Purchasers"), as set
forth below.
1. The Securities. Subject to the terms and
conditions herein contained, the Company proposes to issue and
sell to the Purchasers the number of Units (as defined below)
stated opposite the respective names thereof on Schedule 1
hereto, each consisting of 1 share of 14-3/4% Redeemable
Preferred Stock due 2008, par value $1.00 per share
(collectively, the "Preferred Stock"), and one Warrant
(collectively, the "Warrants," and, together with the Preferred
Stock, the "Units") initially to purchase 80.318 shares (the
"Initial Warrant Shares") of the Company's common stock (the
"Common Stock"), subject to adjustment which would result in each
Warrant being exercisable for 22.645 shares of Common Stock (the
"Additional Warrant Shares" and together with the Initial Warrant
Shares, the "Warrant Shares") in the event the Company fails to
raise net proceeds of at least $50,000,000 through the issue and
sale of its qualified capital stock (as defined in the Warrant
Agreement described below)(other than preferred stock) on or
before December 31, 1998 (the "Warrant Adjustment Date"). Each
Purchaser will purchase that amount of Units stated opposite its
name on Schedule 1 hereto and will not be responsible for the
purchase of any Units to be bought by the other Purchasers
hereunder. The Warrants are to be issued under a warrant
agreement (the "Warrant Agreement") to be entered into between
the Company and Chase Manhattan Bank, as Warrant Agent (the
"Warrant Agent"). The Units, the Preferred Stock and the
Warrants are herein collectively referred to as the "Securities."
The Securities will be offered and sold to the
Purchasers without being registered under the Securities Act of
1933, as amended (the "Act"), in reliance on one or more
exemptions therefrom.
In connection with the sale of the Securities, the
Company has prepared a preliminary offering memorandum dated June
11, 1997 (the "Preliminary Memorandum") and a final offering
memorandum dated July 3, 1997 (the "Final Memorandum"; the
Preliminary Memorandum and the Final Memorandum each herein being
referred to as a "Memorandum"), each setting forth or including a
description of the terms of the Securities, the terms of the
offering of the Securities, a description of the Company and any
material developments relating to the Company occurring after the
date of the most recent historical financial statements included
therein.
The Purchasers and their direct and indirect
transferees of the Securities will be entitled to the benefits of
(i) the Preferred Registration Rights Agreement (the "Preferred
Registration Rights Agreement"), among the Company, the
Purchasers, BT Securities, Inc. and Xxxx. Xxxxx & Sons
Incorporated (collectively, the "Initial Purchasers"), which will
require the Company, among other things, to file with the
Securities and Exchange Commission (the "Commission") under the
circumstances set forth therein a shelf registration statement
(the "Registration Statement") pursuant to Rule 415 under the Act
relating to the resale of the Preferred Stock by Holders thereof
and to use its best efforts to cause such registration statement
to be declared effective, (ii) a Supplemental Registration Rights
Agreement (the "Supplemental Registration Rights Agreement")
containing certain demand registration rights and (iii) the
Warrant Agreement which will require the Company, among other
things, to file with the Commission under the Act a registration
statement (the "Equity Registration Statement") registering the
resale of the Warrants and Warrant Shares, and to use its
commercially reasonable efforts to cause such registration
statement to be declared effective.
This purchase agreement (the "Agreement"), the
Securities, the Warrant Agreement, the Preferred Registration
Rights Agreement and the Supplemental Registration Rights
Agreement are herein collectively referred to as the "Offering
Documents."
2. Representations and Warranties. The Company
represents and warrants to and agrees with the Purchasers that:
(a) Neither the Preliminary Memorandum as of the date
thereof nor the Final Memorandum nor any amendment or
supplement thereto as of the date thereof and at all times
subsequent thereto up to the Closing Date (as defined in
Section 3 below) contained or contains any untrue statement
of a material fact or omitted or omits to state a material
fact necessary to make the statements therein, in the light
of the circumstances under which they were made, not
misleading, except that the representations and warranties
set forth in this Section 2(a) do not apply to statements or
omissions made in reliance upon and in conformity with
information relating to the Purchasers furnished to the
Company in writing by the Purchasers expressly for use in
the Preliminary Memorandum, the Final Memorandum or any
amendment or supplement thereto.
(b) The Company has no material subsidiaries other
than those listed on Schedule 2 hereto (the "Subsidiaries")
and, except as set forth on such schedule, owns all the
issued and outstanding capital stock of each of the
Subsidiaries. Each of the Company and the Subsidiaries is
duly incorporated or organized, validly existing and in good
standing as a corporation or a limited liability company, as
the case may be, under the laws of its jurisdiction of
incorporation or organization, with all requisite corporate
or other power and authority to own or lease its properties
and conduct its business as now conducted, as described in
the Final Memorandum; each of the Company and the
Subsidiaries is duly qualified to do business as a foreign
corporation in good standing in the jurisdiction in which it
has its principal place of business and in all other
jurisdictions where the ownership or leasing of its
properties or the conduct of its business requires such
qualification, except where the failure to be so qualified
would not, singly or in the aggregate, have a material
adverse effect on the business, condition (financial or
other), prospects or results of operations of the Company
and the Subsidiaries, taken as a whole (any such event, a
"Material Adverse Effect").
(c) The Preferred Stock and the Certificate of
Designation, as amended, relating to the Preferred Stock
(the "Certificate of Designation") have been duly authorized
by the Company. Prior to the Closing Date, the Preferred
Stock and additional shares of Redeemable Preferred Stock
(as defined in the Certificate of Designation) sufficient to
pay dividends to the Redemption Date (as defined in the
Certificate of Designation), shall have been duly authorized
and, when issued and delivered, in the case of the Preferred
Stock, against payment therefor in accordance with the terms
hereof, will be validly issued, fully paid and nonassessable
and free of any preemptive or similar rights; as of the
Closing Date, the capital stock of the Company shall conform
in all material respects to the description thereof in the
Final Memorandum.
(d) The Company has all requisite corporate power and
authority to execute and deliver the Preferred Registration
Rights Agreement and the Supplemental Registration Rights
Agreement; the Preferred Registration Rights Agreement and
the Supplemental Registration Rights Agreement have been
duly authorized by the Company and, when executed and
delivered by the Company (assuming due authorization,
execution and delivery by the Initial Purchasers and the
Purchasers (with respect to the Preferred Registration
Rights Agreement) or the Purchasers (with respect to the
Supplemental Registration Rights Agreement), will constitute
a valid and legally binding agreement of the Company,
enforceable against the Company in accordance with its
terms, except that (i) the enforcement thereof may be
subject to (A) bankruptcy, insolvency, reorganization,
fraudulent conveyance, moratorium or other similar laws now
or hereafter in effect relating to creditors' rights
generally and (B) general principles of equity and the
discretion of the court before which any proceeding therefor
may be brought and (ii) any rights to indemnity or
contribution thereunder may be limited by federal and state
securities laws and public policy considerations.
(e) The Company has all requisite corporate power and
authority to execute and deliver this Agreement and,
subsequent to the filing of the Certificate of Designation
to issue and deliver the Securities and to consummate the
transactions contemplated hereby. This Agreement has been
duly authorized, executed and delivered by the Company.
Except as described in the Final Memorandum, no consent,
approval, authorization or order of any court or
governmental agency or body having jurisdiction over the
Company or the Subsidiaries (including, without limitation,
the Federal Communications Commission (the "FCC")) is
required for the performance of this Agreement by the
Company or the consummation by the Company of the
transactions contemplated hereby, except such as have been
obtained and such as may be required under state securities
or "Blue Sky" laws in connection with the purchase and
resale of the Securities by the Purchasers. Except as set
forth in the Final Memorandum, neither the Company nor any
of the Subsidiaries is (i) in violation of its certificate
of incorporation or by-laws (or similar organizational
document), (ii) in violation of any statute, judgment,
decree, order, rule or regulation applicable to the Company
or the Subsidiaries, which violation would, individually or
in the aggregate, have a Material Adverse Effect or (iii)
in default in the performance or observance of any
obligation, agreement, covenant or condition contained in
any indenture, mortgage, deed of trust, loan agreement,
note, lease, license, franchise agreement, permit,
certificate, contract or other agreement or instrument to
which the Company or the Subsidiaries is a party or to which
the Company or the Subsidiaries is subject, which default
would, individually or in the aggregate, have a Material
Adverse Effect.
(f) Neither the issuance and sale of the Securities
nor the execution, delivery and performance by the Company
of this Agreement, the Preferred Registration Rights
Agreement, the Supplemental Registration Rights Agreement or
the Warrant Agreement and the consummation of the
transactions contemplated hereby and thereby will conflict
with or constitute or result in a breach, default or
violation of (or with the giving of notice, passage of time
or both would result in a breach, default or violation of),
or result in the creation or imposition of a lien, charge or
encumbrance on any properties or assets of the Company or
the Subsidiaries with respect to, any of (i) the terms or
provisions of, or constitute a default by the Company under,
any indenture, mortgage, deed of trust, loan agreement,
note, lease, license, franchise agreement, or other
agreement or instrument to which the Company is a party or
to which the Company or its respective properties is
subject, which conflict, breach, violation, or default
would, individually or in the aggregate, have a Material
Adverse Effect, (ii) the certificate of incorporation or
by-laws of the Company, as the same will be in effect on the
Closing Date or (iii) (assuming compliance with all
applicable state securities and "Blue Sky" laws and assuming
the accuracy of the representations and warranties of the
Purchasers in Section 8 hereof) any statute, judgment,
decree, order, rule or regulation of any court or
governmental agency or other body applicable to the Company
or any of its respective properties, which conflict, breach,
violation, default, lien, charge or encumbrance would,
individually or in the aggregate, have a Material Adverse
Effect.
(g) The audited consolidated financial statements of
the Company included in the Final Memorandum present fairly
in all material respects the financial position, results of
operations and cash flows of the Company and the
Subsidiaries at the dates and for the periods to which they
relate and have been prepared in accordance with generally
accepted accounting principles applied on a consistent
basis, except as otherwise stated therein and are in all
material respects in accordance with the books and records
of the Company and its subsidiaries. The summary and
selected financial and statistical data in the Final
Memorandum present fairly in all material respects the
information shown therein and have been prepared and
compiled on a basis consistent with the audited financial
statements included therein, except as otherwise stated
therein. KPMG Peat Marwick LLP (the "Independent
Accountants") is an independent public accounting firm
within the meaning of the Act and the rules and regulations
promulgated thereunder.
(h) The pro forma financial statements (including the
notes thereto) and the other pro forma financial information
included in the Final Memorandum (i) comply as to form in
all material respects with the applicable requirements of
Regulation S-X promulgated under the Securities Exchange Act
of 1934, as amended (the "Exchange Act"), (ii) have been
prepared in accordance with the Commission's rules and
guidelines with respect to pro forma financial statements
and (iii) have been properly computed on the bases described
therein; the assumptions used in the preparation of the pro
forma financial data and other pro forma financial
information included in the Final Memorandum are reasonable
and the adjustments used therein are appropriate to give
effect to the transactions or circumstances referred to
therein.
(i) Except as described in the Final Memorandum, there
is neither pending nor, to the best knowledge of the Company
after due inquiry, threatened any action, suit, proceeding,
inquiry or investigation to which the Company or any of the
Subsidiaries is a party, or to which any of their respective
properties or assets are subject, before or brought by any
court, arbitrator or governmental agency or body (including,
without limitation, the FCC) that would, individually or in
the aggregate, be reasonably likely to have a Material
Adverse Effect or that seeks to restrain, enjoin, prevent
the consummation of or otherwise challenge or relate to the
issuance or sale of the Securities to be sold hereunder or
the consummation of the other transactions described in the
Final Memorandum.
(j) Each of the Company and the Subsidiaries owns or
possesses adequate licenses or other rights to use all
patents, trademarks, service marks, trade names, copyrights
and know-how, and on the Closing Date will possess such
licenses, rights and know-how necessary to conduct the
businesses currently operated by it, as described in the
Final Memorandum, the lack of which would, individually or
in the aggregate, have a Material Adverse Effect, and
neither the Company nor the Subsidiaries has received any
notice of infringement of, or conflict with (or knows of any
such infringement of or conflict with) asserted rights of
others with respect to any patents, trademarks, service
marks, trade names, copyrights or know-how necessary to
conduct the businesses operated by it that, if such
assertion of infringement or conflict were sustained, would,
individually or in the aggregate, have a Material Adverse
Effect.
(k) Each of the Company and the Subsidiaries has
obtained, or has applied for, all consents, approvals,
authorizations, orders, registrations, filings,
qualifications, licenses (including, without limitation, all
material licenses from the FCC and state, local or other
governmental authorities), permits, franchises and other
governmental authorizations necessary to conduct its
businesses as described in the Final Memorandum, the lack of
which, individually or in the aggregate, would have a
Material Adverse Effect. Neither the Company nor any of the
Subsidiaries has received any notice of proceedings related
to the revocation or materially adverse modification of any
such consent, approval, authorization, order, registration,
filing, qualification, license or permit, the lack of which
would, individually or in the aggregate, have a Material
Adverse Effect.
(l) Subsequent to the respective dates as of which
information is given in the Final Memorandum and except as
described therein or contemplated thereby, (i) neither the
Company nor any of the Subsidiaries has incurred any
material liabilities or obligations, direct or contingent,
or entered into any material transactions not in the
ordinary course of business; and (ii) the Company has not
purchased any of its outstanding capital stock or declared,
paid or otherwise made any dividend or distribution of any
kind on its capital stock.
(m) There are no legal or governmental proceedings
involving or affecting the Company or any of the
Subsidiaries or any of their respective properties or assets
(other than proceedings, individually or in the aggregate,
which would not, if the subject of an unfavorable decision,
ruling or finding, result in a Material Adverse Effect) that
are not described in or contemplated by the Final
Memorandum. Except as described in or contemplated by the
Final Memorandum, neither the Company nor any of the
Subsidiaries is in default under any material contract, has
received a notice or claim of any such default or has
knowledge of any breach of any such contract by the other
party or parties thereto, except such defaults or breaches
which would not, individually or in the aggregate, have a
Material Adverse Effect.
(n) Each of the Company and the Subsidiaries has filed
all necessary federal, state, local and foreign income,
franchise and property tax returns, except where the failure
to so file such returns would not, individually or in the
aggregate, have a Material Adverse Effect, and each of the
Company and the Subsidiaries has paid all taxes shown as due
thereon as of the Closing Date; and other than tax
deficiencies that the Company or any of the Subsidiaries is
contesting in good faith and for which adequate reserves
have been provided, there is no tax deficiency that has been
asserted against the Company or any of the Subsidiaries that
would, individually or in the aggregate, have a Material
Adverse Effect. The charges, accruals and reserves on the
consolidated books of the Company in respect of any tax
liability for any years not finally determined are adequate
to meet any assessments or re-assessments for additional tax
for any years not finally determined, except to the extent
of any inadequacy that would not, individually or in the
aggregate, have a Material Adverse Effect.
(o) The statistical and market-related data included
in the Final Memorandum are based on or derived from sources
that the Company believes to be reasonably reliable and
accurate.
(p) Each of the Company and the Subsidiaries has good
and marketable title to all real property and good title to
all personal property described in the Final Memorandum as
being owned by it and good and marketable title to all
leasehold estates in the real and personal property
described in the Final Memorandum as being leased by it
(except for those leases of real property in which the
Company has good title and that would be marketable but for
the requirement that the landlord consent to an assignment
or sublease of the lease), free and clear of all liens,
charges, encumbrances or restrictions, except, in each case,
as described in or contemplated by the Final Memorandum
(including the description of the AT&T Credit Facility set
forth therein) or to the extent the failure to have such
title or the existence of such liens, charges, encumbrances
or restrictions would not, individually or in the aggregate,
have a Material Adverse Effect. All leases, contracts and
agreements to which the Company or any of the Subsidiaries
is a party or by which any of them is bound are valid and
enforceable against the Company or such Subsidiaries and are
valid and enforceable against the other party or parties
thereto and are in full force and effect with only such
exceptions as would not, individually or in the aggregate,
have a Material Adverse Effect. No real or personal
property, rights-of-way, conduits, pole attachments or fiber
leased, licensed or used by the Company or any of the
Subsidiaries lies in an area that is, or to the best
knowledge of the Company will be, subject to zoning, use, or
building code restrictions that would prohibit, and no state
of facts relating to the actions or inaction of another
person or entity or his, her or its ownership, leasing,
licensing or use of any such real or personal property,
rights-of-way, conduits, pole attachments or fiber exists
that would prevent the continued effective leasing,
licensing or use of such real or personal property,
rights-of-way, conduits, pole attachments or fiber in the
business of the Company or any of the Subsidiaries as
presently conducted, subject in each case to such exceptions
as, individually or in the aggregate, do not have and are
not reasonably likely to have a Material Adverse Effect.
(q) None of the Company or any of the Subsidiaries is
and, after giving effect to the offering and sale of the
Securities and the application of the proceeds therefrom as
described in or contemplated by the Final Memorandum, none
will be, an "investment company," or "promoter" or
"principal underwriter" for an "investment company," as such
terms are defined in the Investment Company Act of 1940, as
amended, and the rules and regulations thereunder.
(r) Neither the Company nor any of its directors,
officers or controlling persons has taken, directly or
indirectly, any action designed, or that might reasonably be
expected, to cause or result, under the Act or otherwise,
in, or that has constituted, stabilization or manipulation
of the price of any security of the Company to facilitate
the sale or resale of any of the Securities.
(s) Each of the Company and the Subsidiaries (i) makes
and keeps accurate books and records and (ii) maintains
internal accounting controls that provide reasonable
assurance that (A) transactions are executed in accordance
with management's authorization, (B) transactions are
recorded as necessary to permit preparation of its financial
statements and to maintain accountability for its assets,
(C) access to its assets is permitted only in accordance
with management's authorization and (D) the reported
accountability for its assets is compared with existing
assets at reasonable intervals.
(t) None of the Company, any of the Subsidiaries or
any of their respective Affiliates (as defined in Rule
501(b) of Regulation D under the Act) has directly, or
through any agent, (i) sold, offered for sale, solicited
offers to buy or otherwise negotiated in respect of, any
"security" (as defined in the Act) that is or could be
integrated with the sale of the Securities in a manner that
would require the registration under the Act of the
Securities or (ii) engaged in any form of general
solicitation or general advertising (as those terms are used
in Regulation D under the Act) in connection with the
offering of the Securities or in any manner involving a
public offering within the meaning of Section 4(2) of the
Act. Assuming the accuracy of the representations and
warranties of the Purchasers in Section 8 hereof, and the
representations and warranties of the Initial Purchasers in
Section 8 of that certain purchase agreement dated July 3,
1997 among the Company, BT Securities Corporation and Xxxx.
Xxxxx & Sons Incorporated (the "BT Purchase Agreement"), it
is not necessary in connection with the offer, sale and
delivery of the Securities to the Purchasers in the manner
contemplated by this Agreement to register any of the
Securities under the Act.
(u) No securities of the Company or any of the
Subsidiaries are of the same class (within the meaning of
Rule 144A under the Act) as the Preferred Stock, Warrants or
Units and listed on a national securities exchange
registered under Section 6 of the Exchange Act or quoted in
a U.S. automated inter-dealer quotation system.
(v) The Company has all requisite corporate power and
authority to execute and deliver the Warrant Agreement; the
Warrant Agreement has been duly authorized by the Company
and, when executed and delivered by the Company (assuming
the due authorization, execution and delivery by the Warrant
Agent), will constitute a valid and legally binding
agreement of the Company, enforceable against the Company in
accordance with its terms except that (i) the enforcement
thereof may be subject to (A) bankruptcy, insolvency,
reorganization, fraudulent conveyance, moratorium or other
similar laws now or hereafter in effect relating to
creditors' rights generally and (B) general principles of
equity and the discretion of the court before which any
proceeding therefor may be brought and (ii) any rights to
indemnity or contribution thereunder may be limited by
federal and state securities laws and public policy
considerations.
(w) The Warrants have been duly and validly authorized
by the Company and, when executed by the Company and
countersigned by the Warrant Agent in accordance with the
provisions of the Warrant Agreement, and delivered to and
paid for by the Purchasers in accordance with the terms
hereof, will be entitled to the benefits of the Warrant
Agreement and will constitute valid and binding obligations
of the Company enforceable in accordance with their terms,
except that the enforcement thereof may be subject to (i)
bankruptcy, insolvency, reorganization, fraudulent
conveyance, moratorium or other similar laws now or
hereafter in effect relating to creditors' rights generally
and (ii) general principles of equity and the discretion of
the court before which any proceeding therefor may be
brought.
(x) As of the Closing Date, the Company will have the
capitalization set forth in or contemplated by the Final
Memorandum; all of the outstanding shares of capital stock
of the Company and the Subsidiaries that are corporations
have been, and as of the Closing Date will be, duly
authorized and validly issued, are fully paid and
nonassessable and were not issued in violation of any
preemptive or similar rights; except as set forth in or
contemplated by the Final Memorandum, all of the outstanding
shares of capital stock of the Company and of each of the
Subsidiaries that are corporations, as of the Closing Date,
will be free and clear of all liens, encumbrances, equities
and claims or restrictions on transferability (other than
those imposed by the Act and the securities or "Blue Sky"
laws of certain jurisdictions and other than those shares
the holders of which have subjected to liens) or voting;
other than pursuant to the Warrant Agreement or as set forth
in the Final Memorandum, there are no (i) options, warrants,
or other rights to purchase from the Company or any of the
Subsidiaries, (ii) agreements or other obligations of the
Company or any of the Subsidiaries to issue capital stock or
(iii) other rights to which the Company or any of the
Subsidiaries is a party to convert any obligation, or
exchange any securities for, shares of capital stock of or
ownership interests in the Company or any of the
Subsidiaries outstanding.
(y) When issued in accordance with the terms and
conditions contained in the Warrant Agreement upon exercise
of the Warrants, the Warrant Shares will be duly authorized,
validly issued, fully paid and nonassessable and will not be
subject to any preemptive or similar rights. The Warrant
Shares have been duly reserved for issuance in accordance
with the terms of the Warrants and the Warrant Agreement.
(z) Since the date of the most recent financial
statements appearing in the Final Memorandum and except as
described therein, (i) there has not been any change in the
capital stock or long-term indebtedness of the Company or
any of the Subsidiaries which would, individually or in the
aggregate, have a Material Adverse Effect and (ii) there has
not occurred, nor has information become known nor has any
state of facts arisen that could, individually or in the
aggregate, reasonably be expected to have a Material Adverse
Effect whether or not arising in the ordinary course of
business.
(aa) There is no strike, labor dispute, slowdown or
work stoppage with the employees of the Company or any of
the Subsidiaries that is pending or, to the knowledge of the
Company or any of the Subsidiaries, threatened.
(bb) Except as set forth in the Final Memorandum, each
of the Company and the Subsidiaries carries insurance in
such amounts and covering such risks as is adequate for the
conduct of its business and the value of its properties.
(cc) The Company maintains, sponsors, contributes to,
or has or has had an obligation with respect to "employee
benefit plans," within the meaning of Section 3(3) of ERISA,
and may or has had obligations with respect to other bonus,
profit sharing, compensation, pension, severance, deferred
compensation, fringe benefit, insurance, welfare,
post-retirement, health, life, stock option, stock purchase,
restricted stock, tuition refund, service award, company
car, scholarship, relocation, disability, accident, sick,
vacation, holiday, termination, unemployment, individual
employment, consulting, executive compensation, incentive,
commission, payroll practices, retention, change in control,
noncompetition, collective bargaining and other plans,
agreements, policies, trust funds, or arrangements (whether
written or unwritten, insured or self-insured) on behalf of
employees, directors, or shareholders of the Company
(whether current, former, or retired) or their beneficiaries
(each a "Plan" and, collectively, the "Plans"). Neither the
Company nor any ERISA Affiliate has any liability, direct or
indirect, or actual or contingent (but excluding any
contributions due in the ordinary course) with respect to
any plan subject to Section 412 of the Code, Section 302 of
ERISA or Title IV of ERISA that has or could reasonably be
expected to have a Material Adverse Effect. The
consummation of the transactions contemplated by this
Agreement will not give rise to any liability with respect
to any Plan that could reasonably be expected to have a
Material Adverse Effect, including, without limitation,
liability for severance pay, unemployment compensation,
termination pay or withdrawal liability, or accelerate the
time of payment or vesting or increase the amount of
compensation or benefits due to any employee, director, or
shareholder of the Company (whether current, former, or
retired) or their beneficiaries solely by reason of such
transactions. Except as would not individually or in the
aggregate have, or could not reasonably be expected to have,
a Material Adverse Effect: (i) neither the Company nor any
ERISA Affiliate has made any promises or commitments to
create any additional plan, agreement, or arrangement; (ii)
no event, condition, or circumstance exists that could
result in an increase of the benefits provided under any
Plan or the expense of maintaining any Plan from the level
of benefits or expense incurred for the most recent fiscal
year ended before the Closing; and (iii) neither the Company
nor any ERISA Affiliate has or could be expected to have any
liability for any prohibited transaction as defined in
Section 406 of ERISA or Section 4975 of the Code. With
respect to each of the Plans: (i) each Plan intended to
qualify under Section 401(a) of the Code has been qualified
since its inception and has received a determination letter
under Revenue Procedure 93-39 from the IRS to the effect
that the Plan is qualified under Section 401 of the Code and
any trust maintained pursuant thereto is exempt from federal
income taxation under Section 501 of the Code and nothing
has occurred or is expected to occur through the date of the
Closing that caused or could cause the loss of such
qualification or exemption or the imposition of any penalty
or tax liability that has or could reasonably be expected to
have a Material Adverse Effect; (ii) no claim, lawsuit,
arbitration, audit or investigation or other action has been
threatened, asserted, instituted, or anticipated against the
Plans (other than non-material routine claims for benefits,
and appeals of such claims), any trustee or fiduciaries
thereof, the Company, any ERISA Affiliate, any director,
officer, or employee thereof, or any of the assets of any
trust of the Plans that would have or could reasonably be
expected to have a Material Adverse Effect; (iii) the Plan
complies in all material respects and has been maintained
and operated in all material respects in accordance with its
terms and applicable law, including, without limitation,
ERISA and the Code; and (iv) with respect to each Plan that
is funded mostly or partially through an insurance policy,
the Company has no liability in the nature of retroactive
rate adjustment, loss sharing arrangement or other actual or
contingent liability arising wholly or partially out of
events occurring on or before the Closing that has or could
reasonably be expected to have a Material Adverse Effect.
(dd) The Preferred Stock, the Warrants, the Warrant
Agreement and the Preferred Registration Rights Agreement
will conform in all material respects to the descriptions
thereof in the Final Memorandum.
Any certificate signed by any officer of the Company or
any subsidiary and delivered to the Purchasers or to counsel for
the Purchasers shall be deemed a representation and warranty by
the Company and each of its subsidiaries to the Purchasers as to
the matters covered thereby.
No representation or warranty of the Company contained
herein shall be affected by any knowledge of or attributable to
any present or former representative on or observer to the
Company's or its Subsidiaries' boards of directors who is an
employee, designee, or affiliate of any Purchaser.
3. Purchase, Sale and Delivery of the Securities. On
the basis of the representations, warranties, agreements and
covenants herein contained and subject to the terms and
conditions herein set forth, the Company agrees to issue and sell
to each of the Purchasers, and each of the Purchasers agrees to
purchase from the Company the number of Units, at the purchase
price for such Units, each as set forth opposite the names of the
Purchasers in Schedule 1 hereto. The obligations of the
Purchasers under this Agreement are several and not joint.
One or more certificates in definitive form for the
Securities that the Purchasers have agreed to purchase hereunder,
and in such denomination or denominations and registered in such
name or names as the Purchasers request upon notice to the
Company at least 48 hours prior to the Closing Date, shall be
delivered by or on behalf of the Company to the Purchasers,
against payment by or on behalf of the Purchasers of the purchase
price therefor by wire transfer (same-day funds), payable to or
upon the order of the Company in immediately available funds.
Such delivery of and payment for the Securities shall be made at
the offices of Xxxxxx Xxxxxx & Xxxxxxx, 00 Xxxx Xxxxxx, Xxx Xxxx,
Xxx Xxxx on or about 9:00 A.M., New York City time, on July 10,
1997, or at such other place, time or date as the Purchasers and
the Company may agree upon, such time and date of delivery
against payment being herein referred to as the "Closing Date."
The Company will make such certificate or certificates for the
Securities available for checking and packaging by the Purchasers
at the offices in New York, New York of BT Securities Corporation
at least 24 hours prior to the Closing Date.
4. [Intentionally Omitted]
5. Covenants of the Company. The Company covenants
and agrees with the Purchasers that:
(a) The Company will not amend or supplement the Final
Memorandum or any amendment or supplement thereto of which
the Purchasers and counsel to the Purchasers shall not
previously have been advised and furnished a copy for a
reasonable period of time prior to the proposed amendment or
supplement and as to which the Purchasers shall not have
given their consent. The Company will promptly, upon the
reasonable request of the Purchasers or counsel for the
Purchasers, make any amendments or supplements to the
Preliminary Memorandum or the Final Memorandum that may be
reasonably necessary or advisable in connection with the
resale of the Securities by the Purchasers.
(b) The Company will cooperate with the Purchasers in
arranging for the qualification of the Securities for
offering and sale under the securities or "Blue Sky" laws of
such jurisdictions as the Purchasers may designate and will
continue such qualifications in effect for as long as may be
necessary to complete the resale of the Securities by the
Purchasers; provided, however, that in connection therewith
the Company shall not be required to qualify as a foreign
corporation or to execute a general consent to service of
process in any jurisdiction or subject the Company to any
tax in any such jurisdiction where it is not then so
subject.
(c) Until the date of the completion of the sale of
the Securities, if, at any time prior to the completion of
the distribution by the Purchasers of the Securities any
event occurs as a result of which the Final Memorandum as
then amended or supplemented would include an untrue
statement of a material fact, or omit to state a material
fact necessary to make the statements therein, in the light
of the circumstances under which they were made, not
misleading, or if for any other reason it is necessary at
any time to amend or supplement the Final Memorandum in
order to comply with applicable law, the Company will
promptly notify the Purchasers thereof and will prepare, at
the Company's expense, an amendment or supplement to the
Final Memorandum that corrects such statement or omission or
effects such compliance.
(d) The Company will, without charge, provide to the
Purchasers and to counsel for the Purchasers, during the
period referred to in paragraph (c) above, as many copies of
the Final Memorandum or any amendment or supplement thereto
as the Purchasers may reasonably request.
(e) The Company will apply the net proceeds from the
sale of the Securities substantially as set forth under "Use
of Proceeds" in the Final Memorandum.
(f) For so long as any of the Securities remain
outstanding, the Company will, during any period in which it
is not subject to and in compliance with Section 13 or 15(d)
of the Exchange Act, provide to each holder of Securities
and to each prospective purchaser (as designated by such
holder) of Securities, any information required to be
provided by Rule 144A(d)(4) under the Act.
(g) Prior to the Closing Date, the Company will
furnish to the Purchasers, as soon as they have been
prepared by or are available to the Company, a copy of any
unaudited interim consolidated financial statements of the
Company for any period subsequent to the period covered by
its most recent financial statements appearing in the Final
Memorandum.
(h) Neither the Company nor any of its Affiliates will
sell, offer for sale or solicit offers to buy or otherwise
negotiate in respect of any "security" (as defined in the
Act) that could be integrated with the sale of the
Securities in a manner that would require the registration
under the Act of the Securities.
(i) The Company will not, and will not permit any of
the Subsidiaries to, engage in any form of general
solicitation or general advertising (as those terms are used
in Regulation D under the Act) in connection with the
offering of the Securities or in any manner involving a
public offering within the meaning of Section 4(2) of the
Act.
(j) The Company will cooperate with the Purchasers to
(i) if requested, permit the Units, the Preferred Stock and
the Warrants to be designated PORTAL securities in
accordance with the rules and regulations adopted by the
NASD relating to trading in the Private Offerings, Resales
and Trading through Automated Linkages Market (the "PORTAL
Market"), (ii) if requested, permit the Securities to be
eligible for clearance and settlement through The Depository
Trust Company and (iii) permit the Warrant Shares upon
issuance and registration under the Act (as defined in the
Warrant Agreement) to be listed on the Nasdaq National
Market or other national securities exchange on which the
Company's Common Stock is then listed.
6. Expenses. The Company agrees to pay the following
costs and expenses and all other costs and expenses incident to
the performance of its obligations under this Agreement, whether
or not the transactions contemplated herein are consummated or
this Agreement is terminated pursuant to Section 11 hereof: (i)
any costs of printing the Preliminary Memorandum and the Final
Memorandum and any amendments or supplements thereto, and any
"Blue Sky" memoranda, (ii) all arrangements relating to the
delivery to the Purchasers of copies of the foregoing documents
and the other Offering Documents as required by this Agreement,
(iii) the reasonable fees and disbursements of the counsel, the
accountants and any other experts or advisors retained by the
Company and the Purchasers, (iv) the preparation (including
printing), issuance and delivery to the Purchasers of any
certificates evidencing the Securities, including transfer
agent's fees, (v) the qualification of the Securities under state
securities and "Blue Sky" laws, including filing fees and
reasonable fees and disbursements of counsel relating thereto,
(vi) the expenses of the Company in connection with any meetings
with prospective investors in the Securities (vii) the fees and
expenses of the Warrant Agent, the transfer agent and registrar
of the Common Stock, including fees and expenses of their
respective counsel, (viii) all expenses and listing fees incurred
in connection with the application, if requested, for quotation
of the Units, the Preferred Stock and the Warrants on the PORTAL
Market and (ix) any fees charged by investment rating agencies
for the rating of the Securities. If the issuance and sale of
the Securities provided for herein are not consummated because
any condition to the obligations of the Purchasers set forth in
Section 7 hereof is not satisfied, because this Agreement is
terminated pursuant to paragraphs (i) and (v) of Section 11
hereof or because of any failure, refusal or inability on the
part of the Company to perform all obligations and satisfy all
conditions on its part to be performed or satisfied hereunder
(other than solely by reason of a default by the Purchasers of
their obligations hereunder after all conditions hereunder have
been satisfied in accordance herewith), the Company will
reimburse the Purchasers upon demand for all reasonable
out-of-pocket expenses (including reasonable counsel fees and
disbursements) that shall have been incurred by the Purchasers in
connection with the proposed purchase and sale of the Securities.
7. Conditions of the Obligations of the Purchasers.
The obligations of the several Purchasers to purchase and pay for
the Securities shall be subject in the Purchasers' sole
discretion, to the following conditions:
(a) The Purchasers shall have received opinions in
form and substance satisfactory to the Purchasers and
counsel for the Purchasers, dated the Closing Date, of (i)
the opinion of Xxxxx X. Xxxxxx, Esq., General Counsel for
the Company, substantially in the form of Exhibit A-1; (ii)
the opinion of Xxxxxx, Xxxx & Xxxxxx, special regulatory
counsel for the Company, substantially in the form of
Exhibit A-2; and (iii) the opinion of Xxxxxxx, Swaine &
Xxxxx, special counsel for the Company, substantially in the
form of Exhibit A-3 hereto.
(b) [Intentionally Omitted]
(c) The Purchasers shall have received from the
Independent Accountants letters dated, respectively, the
date hereof and the Closing Date, in form and substance
reasonably satisfactory to the Purchasers and counsel for
the Purchasers.
(d) The representations and warranties of the Company
contained in this Agreement shall be true and correct in all
material respects on and as of the Closing Date (other than
to the extent any such representation or warranty is
expressly made as to a certain date); the Company shall have
performed, in all material respects, all covenants and
agreements and satisfied, in all material respects, all
conditions on its part to be performed or satisfied
hereunder at or prior to the Closing Date; and subsequent to
the date of the most recent financial statements in the
Final Memorandum, there shall have been no material adverse
change in the business, condition (financial or other),
prospects or results of operations of the Company and the
Subsidiaries, except as set forth in or contemplated by the
Final Memorandum.
(e) The issuance and sale of the Securities pursuant
to this Agreement shall not be enjoined (temporarily or
permanently) and no restraining order or other injunctive
order shall have been issued or any action, suit or
proceeding shall have been commenced with respect to this
Agreement before any court or governmental authority
(including, without limitation, the FCC).
(f) Subsequent to the respective dates as of which
information is given in the Final Memorandum, except in each
case as described in or as contemplated by the Final
Memorandum, neither the Company nor the Subsidiaries shall
have incurred any liabilities or obligations, direct or
contingent, that would, individually or in the aggregate,
have a Material Adverse Effect on the Company and the
Subsidiaries taken as a whole or entered into any
transaction that would, individually or in the aggregate,
have a Material Adverse Effect on the business, condition
(financial or other), prospects or results of operations of
the Company and the Subsidiaries taken as a whole, and there
shall not have been any change in the capital stock or
long-term indebtedness of the Company that would,
individually or in the aggregate, have a Material Adverse
Effect.
(g) The Purchasers shall have received certificates,
dated the Closing Date, signed on behalf of the Company by
its Executive Chairman of the Board of Directors or
President and Chief Executive Officer and its Chief
Financial Officer to the effect that:
(i) The representations and warranties of the
Company in this Agreement are true and correct in all
material respects as if made on and as of the Closing
Date (other than to the extent any such representation
or warranty is expressly made to a certain date), and
the Company has performed in all material respects all
covenants and agreements and satisfied all conditions
on its part to be performed or satisfied hereunder at
or prior to the Closing Date;
(ii) Subsequent to the respective dates as of
which information is given in the Final Memorandum and
except as described therein or contemplated thereby,
there has not been any material adverse change in the
business, condition (financial or other), prospects or
results of operations of the Company and the
Subsidiaries taken as a whole; and
(iii) The issuance and sale of the Securities
hereunder by the Company has not been enjoined
(temporarily or permanently).
(h) On the Closing Date, the Company and the Initial
Purchasers and the Purchasers shall have entered into the
Preferred Registration Rights Agreement and the Company and
the Purchasers shall have entered into the Supplemental
Registration Rights Agreement.
(i) On or before the Closing Date, the Purchasers and
counsel for the Purchasers shall have received such further
documents, certificates and schedules or instruments
relating to the business, corporate, legal and financial
affairs of the Company as they shall have heretofore
reasonably requested from the Company.
(j) All sales of Units to the Purchasers pursuant to
this Agreement shall close simultaneously with the sales of
an aggregate 29,000 Units to the Initial Purchasers pursuant
to the BT Purchase Agreement.
All such documents, opinions, certificates and
schedules or instruments delivered pursuant to this Agreement
will comply with the provisions hereof only if they are
reasonably satisfactory in all material respects to the
Purchasers and counsel for the Purchasers. The Company shall
furnish to the Purchasers such conformed copies of such
documents, opinions, certificates and schedules or instruments in
such quantities as the Purchasers shall reasonably request.
8. Offering of the Securities; Restrictions on
Transfer. Each of the Purchasers represents and warrants (as to
itself only) that it is a qualified institutional buyer as
defined in Rule 144A promulgated under the Act ("Qualified
Institutional Buyer"). Each of the Purchasers agrees with the
Company that (i) it has not and will not solicit offers for, or
offer to sell, the Securities by any form of general solicitation
or general advertising (as those terms are used in Regulation D
under the Act) or in any manner involving a public offering
within the meaning of Section 4(2) of the Act or, with respect to
Securities sold in reliance on Regulation S under the Act, by
means of any directed selling efforts and (ii) it has not and
will not offer, solicit, solicit offers to buy, deliver, sell or
otherwise transfer any of the Securities prior to the date (the
"Resale Restriction Termination Date") that is two years after
the later of the original issue date of the Securities and the
last date on which the Company or any affiliate of the Company
was the owner of such Securities (or any predecessor of the
Securities) other than (A) to the Company or any subsidiary
thereof, (B) pursuant to a registration statement that has been
declared effective under the Act, (C) for so long as the
Securities are eligible for resale pursuant to Rule 144A, to a
person it reasonably believes is a Qualified Institutional Buyer
that purchases for its own account or for the account of a
Qualified Institutional Buyer to whom notice is given that the
transfer is being made in reliance on Rule 144A, (D) pursuant to
offers and sales that occur outside the United States within the
meaning of Regulation S under the Act in accordance with Exhibit
C hereto, (E) to an Accredited Investor within the meaning of
Rule 501(a)(1), (2), (3) or (7) under the Act that provides a
letter to it in the form of Exhibit B hereto and that is
acquiring the Securities for its own account or for the account
of such an Accredited Investor for investment purposes and not
with a view to, or for offer or sale in connection with, any
distribution in violation of the Act or (F) pursuant to another
available exemption from the registration requirements of the
Act.
9. Indemnification and Contribution.
(a) The Company agrees to indemnify and hold harmless
each Purchaser and its affiliates (other than any affiliate
which has acquired Securities in its capacity as a holder of
securities), directors, officers, employees and each other
person, if any, who controls such Purchaser or its
affiliates within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act, against any losses, claims,
damages or liabilities, joint or several, to which such
Purchaser, such affiliates or such controlling person
(referred to herein as an "Indemnified Party" or
"Indemnified Parties") may become subject under the Act, the
Exchange Act or otherwise, insofar as any such losses,
claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon:
(i) any untrue statement or alleged untrue
statement of any material fact contained in any
Memorandum or any amendment or supplement thereto; or
(ii) the omission or alleged omission to state, in
any Memorandum or any amendment or supplement thereto a
material fact required to be stated therein or
necessary to make the statements therein, in the light
of the circumstances under which they were made, not
misleading,
and will reimburse, as incurred, each such Indemnified Party
for any reasonable legal or other expenses incurred by it in
connection with investigating, defending against or
appearing as a third-party witness in connection with any
such loss, claim, damage, liability (or action in respect
thereof); provided, however, that the Company will not be
liable to a given Indemnified Party in any such case to the
extent that any such loss, claim, damage, or liability
arises out of or is based upon any untrue statement or
alleged untrue statement or omission or alleged omission
made in the any Memorandum or any amendment or supplement
thereto, in reliance upon and in conformity with written
information furnished to the Company by the Purchaser
related to such Indemnified Party specifically for use
therein. This indemnity agreement will be in addition to
any liability that the Company may otherwise have to the
Indemnified Parties. The Company shall not be liable under
this paragraph (a) for any settlement of any claim or action
effected without its consent, which consent shall not be
unreasonably withheld or delayed. A Purchaser shall not,
without the prior written consent of the Company, effect any
settlement or compromise of any pending or threatened
proceeding in respect of which the Company is or could have
been a party, or indemnity could have been sought hereunder
by the Company, unless such settlement (i) includes an
unconditional written release of the Company, in form and
substance reasonably satisfactory to the Company, from all
liability on claims that are the subject matter of such
proceeding and (ii) does not include any statement as to an
admission of fault, culpability or failure to act by or on
behalf of the Company.
(b) Each Purchaser will (severally and not jointly
with the other Purchasers) indemnify and hold harmless the
Company, its directors, its officers and each other person,
if any, who controls the Company within the meaning of
Section 15 of the Act or Section 20 of the Exchange Act
against any losses, claims, damages or liabilities, joint or
several, to which the Company or any such director, officer
or controlling person may become subject under the Act, the
Exchange Act or otherwise, insofar as any such losses,
claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon (i) any untrue
statement or alleged untrue statement of any material fact
contained in any Memorandum, or any amendments or supplement
thereto, or (ii) the omission or the alleged omission to
state in any Memorandum, or any amendment or supplement
thereto, a material fact required to be stated or necessary
to make the statements therein not misleading, in each case
to the extent, but only to the extent, that such untrue
statement or alleged untrue statement or omission or alleged
omission was made in reliance upon and in conformity with
written information concerning such Purchaser furnished to
the Company by such Purchaser specifically for use therein;
and, subject to the foregoing, will reimburse, as incurred,
any reasonable legal or other expenses incurred by the
Company or any such director, officer or controlling person
in connection with investigating, defending against or
appearing as a third party witness in connection with any
such loss, claim, damage, liability (or action in respect
thereof). This indemnity agreement will be in addition to
any liability that such Purchaser may otherwise have to the
Indemnified Parties. Such Purchaser shall not be liable
under this paragraph (b) for any settlement of any claim or
action effected without its consent, which consent shall not
be unreasonably withheld or delayed. The Company shall not,
without the prior written consent of such Purchaser, effect
any settlement or compromise of any pending or threatened
proceeding in respect of which such Purchaser is or could
have been a party, or indemnity could have been sought
hereunder by such Purchaser, unless such settlement (i)
includes an unconditional written release of such Purchaser,
in form and substance reasonably satisfactory to such
Purchaser, from all liability on claims that are the subject
matter of such proceeding and (ii) does not include any
statement as to an admission of fault, culpability or
failure to act by or on behalf of such Purchaser.
(c) Promptly after receipt by an Indemnified Party
under paragraph (a) or (b) above of notice of the
commencement of any action for which such Indemnified Party
is entitled to indemnification under this Section 9, such
Indemnified Party will, if a claim in respect thereof is to
be made against the indemnifying party under this Section 9,
notify the indemnifying party of the commencement thereof in
writing; but the failure so to notify the indemnifying party
(i) will not relieve it from any liability under paragraphs
(a) or (b) above except to the extent such indemnifying
party has been materially prejudiced by such failure
(including, without limitation, that such failure results in
the forfeiture by the indemnifying party of substantial
rights and defenses) and (ii) will not, in any event,
relieve the indemnifying party from any obligations to any
Indemnified Party other than the indemnification obligation
provided in paragraph (a) and (b) above. In case any such
action is brought against any Indemnified Party, and it
notifies the indemnifying party of the commencement thereof,
the indemnifying party will be entitled to participate
therein and, to the extent that it may wish, jointly with
any other indemnifying party similarly notified, to assume
the defense thereof, with counsel reasonably satisfactory to
such Indemnified Party; provided, however, that if (i) the
indemnifying party has failed to assume the defense thereof
and employ such counsel or (ii) the named parties to any
such action (including any impleaded parties) include both
the indemnifying party and the Indemnified Party and the
indemnifying party and the Indemnified Party shall have been
advised by counsel that representation of such indemnifying
party and such Indemnified Party by the same counsel would
be inappropriate under applicable standards of professional
conduct due to differing interests between them, then, in
each such case, the indemnifying party shall not have the
right to direct the defense of such action on behalf of such
Indemnified Party or parties and such Indemnified Party or
parties shall have the right to select separate counsel to
defend such action on behalf of such Indemnified Party or
parties. After notice from the indemnifying party to such
Indemnified Party of its election so to assume the defense
thereof and the reasonable approval by such Indemnified
Party of counsel appointed to defend such action, the
indemnifying party will not be liable to such Indemnified
Party under this Section 9 for any legal or other expenses,
other than reasonable costs of investigation, subsequently
incurred by such Indemnified Party in connection with the
defense thereof, unless (i) the Indemnified Party shall have
employed separate counsel in accordance with the proviso to
the immediately preceding sentence (it being understood,
however, that in connection with such action the
indemnifying party shall not be liable for the expenses of
more than one separate counsel (in addition to local
counsel) in any one action or separate but substantially
similar actions in the same jurisdiction arising out of the
same general allegations or circumstances, designated by the
Indemnified Parties in the case of paragraph (a) of this
Section 9 or the Company in the case of paragraph (b) of
this Section 9, representing the Indemnified Parties under
such paragraph (a) or paragraph (b), as the case may be, who
are parties to such action or actions), (ii) the
indemnifying party has authorized in writing the employment
of counsel for the Indemnified Party at the expense of the
indemnifying party or (iii) the indemnifying party shall
have failed to assume promptly after notice of the
institution of such action the defense of such action or
retain counsel reasonably satisfactory to the Indemnified
Party. After such notice from the indemnifying party to
such Indemnified Party, the indemnifying party will not be
liable for the costs and expenses of any settlement of such
action effected by such Indemnified Party without the
consent of the indemnifying party, which consent shall not
be unreasonably withheld or delayed.
(d) In circumstances in which the indemnity agreement
provided for in the preceding paragraphs of this Section 9
is unenforceable or insufficient to hold harmless an
Indemnified Party in respect of any losses, claims, damages
or liabilities (or actions in respect thereof), each
indemnifying party, in order to provide for just and
equitable contribution, shall contribute to the amount paid
or payable by such Indemnified Party as a result of such
losses, claims, damages or liabilities (or actions in
respect thereof) in such proportion as is appropriate to
reflect (i) the relative benefits received by the
indemnifying party or parties on the one hand and the
Indemnified Party on the other from the offering of the
Securities or (ii) if the allocation provided by the
foregoing clause (i) is not permitted by applicable law, not
only such relative benefits but also the relative fault of
the indemnifying party or parties on the one hand and the
Indemnified Party on the other in connection with the
statements or omissions or alleged statements or omissions
that resulted in such losses, claims, damages or liabilities
(or actions in respect thereof) as well as any other
relevant equitable considerations. The Company and the
Purchasers agree that it would not be equitable if the
amount of such contribution were determined by pro rata or
per capita allocation or by any other method of allocation
that does not take into account the equitable considerations
referred to above. Notwithstanding any other provision of
this paragraph (d), no person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of
the Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
For purposes of this paragraph (d), each person, if any, who
controls a relevant Purchaser within the meaning of Section
15 of the Act or Section 20 of the Exchange Act shall have
the same rights to contribution as that Purchaser, and each
director of the Company, each officer of the Company and
each person, if any, who controls the Company within the
meaning of Section 15 of the Act or Section 20 of the
Exchange Act, shall have the same rights to contribution as
the Company hereunder.
10. Survival Clause. The respective representations,
warranties, agreements, covenants, indemnities and other
statements of the Company or its officers and of the Purchasers
set forth in this Agreement or made by or on behalf of them,
respectively, pursuant to this Agreement shall remain in full
force and effect, regardless of (i) any investigation made by or
on behalf of the Company, any of its officers or directors or any
controlling person referred to in Section 9(b) hereof, the
Purchasers or any controlling person referred to in Section 9(a)
hereof and (ii) delivery of and payment for the Securities. The
respective agreements, covenants, indemnities and other
statements set forth in Sections 6 and 9 hereof shall remain in
full force and effect, regardless of any termination or
cancellation of this Agreement.
11. Termination.
(a) This Agreement may be terminated as to a given
Purchaser in the sole discretion of such Purchaser by notice
to the Company given prior to the Closing Date in the event
that the Company shall have failed, refused or been unable
to perform all obligations and satisfy all conditions on its
part to be performed or satisfied hereunder at or prior
thereto or if, at or prior to the Closing Date:
(i) any of the Company or the Subsidiaries shall
have sustained any loss or interference with respect to
its businesses or properties from fire, flood,
hurricane, accident or other calamity, whether or not
covered by insurance, or from any strike, labor
dispute, slow down or work stoppage or any legal or
governmental proceeding, which loss or interference, in
the sole judgment of the Purchasers, has had or has,
individually or in the aggregate, a Material Adverse
Effect, or there shall have been, in the sole judgment
of the Purchasers, any event or development that,
individually or in the aggregate, has or could be
reasonably likely to have a Material Adverse Effect
(including without limitation a change in control of
the Company), except in each case as described in the
Final Memorandum (exclusive of any amendment or
supplement thereto);
(ii) trading in securities of the Company or in
securities generally on the New York Stock Exchange,
American Stock Exchange or the Nasdaq National Market
shall have been suspended or minimum or maximum prices
shall have been established on any such exchange or
market;
(iii) a banking moratorium shall have been
declared by New York or United States authorities;
(iv) there shall have been (A) an outbreak or
escalation of hostilities between the United States and
any foreign power, or (B) an outbreak or escalation of
any other insurrection or armed conflict involving the
United States or any other national or international
calamity or emergency, or (C) any material change in
the financial markets of the United States which, in
the case of (A), (B) or (C) above and in the judgment
of the Purchasers, makes it impracticable or
inadvisable to proceed with the offering or the
delivery of the Securities as contemplated by the Final
Memorandum; or
(v) any securities of the Company shall have been
downgraded or placed on any "watch list" since the date
of this Agreement or any securities of the Company not
on any "watch list" on the date hereof shall have been
downgraded or placed on any "watch list" for possible
downgrading by any nationally recognized statistical
rating organization.
(b) Termination of this Agreement pursuant to this
Section 11 shall be without liability of any party to any
other party except as provided in Section 10 hereof.
12. Information Supplied by the Purchasers. The
statements set forth in the last two sentences of the first
paragraph and footnote (3) on the cover page, in the Management
and Principal Stockholders sections relating to any Purchaser or
any affiliates of any Purchaser and in the last two paragraphs of
the section entitled "Private Placement" of the Final Memorandum
constitute the only information furnished in writing by the
Purchasers to the Company for the purposes of Sections 2(a) and 9
hereof.
13. Notices. All communications hereunder shall be in
writing and, if sent to the Purchasers, shall be mailed or
delivered or telecopied and confirmed in writing to them at their
respective addresses set forth on Schedule 1 hereto; if sent to
the Company, shall be mailed or delivered or telecopied and
confirmed in writing to the Company at 000 Xxxxxxxx Xxxxxxxx
Xxxxxxx, Xxxxx 000, Xxxxxxxxx Xxxxxxxx, Xxxxxxxx 00000,
Attention: General Counsel, Telecopier Number (000) 000-0000;
with a copy to Xxxxxxx, Swaine & Xxxxx, 000 Xxxxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000, Attention: Xxxxxx X. Xxxxxxx, Xx., Esq.,
Telecopier Number (000) 000-0000.
All such notices and communications shall be deemed to
have been duly given: when delivered by hand, if personally
delivered; five business days after being deposited in the mail,
postage prepaid, if mailed; and one business day after being
timely delivered to a next-day air courier; and when receipt is
acknowledged by the addressee, if telecopied.
14. Successors. This Agreement shall inure to the
benefit of and be binding upon the parties hereto and their
respective successors and legal representatives, and nothing
expressed or mentioned in this Agreement is intended or shall be
construed to give any other person any legal or equitable right,
remedy or claim under or in respect of this Agreement, or any
provisions herein contained; this Agreement and all conditions
and provisions hereof being intended to be and being for the sole
and exclusive benefit of such persons and for the benefit of no
other person except that (i) the indemnities of the Company
contained in Section 9 of this Agreement shall also be for the
benefit of any person or persons who control each Purchaser
within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act and (ii) the several indemnity of each Purchaser
contained in Section 9 of this Agreement shall also be for the
benefit of the directors of the Company, its officers and any
person or persons who control the Company within the meaning of
Section 15 of the Act or Section 20 of the Exchange Act. No
purchaser of Securities from the Purchasers will be deemed a
successor because of such purchase.
15. Counterparts. This Agreement may be executed in
two or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the
same instrument.
16. APPLICABLE LAW. THE VALIDITY AND INTERPRETATION
OF THIS AGREEMENT, AND THE TERMS AND CONDITIONS SET FORTH HEREIN,
SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF
THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO ANY PROVISIONS
RELATING TO CONFLICTS OF LAW.
If the foregoing correctly sets forth our
understanding, please indicate your acceptance thereof in the
space provided below for that purpose, whereupon this letter
shall constitute a binding agreement between the Company and the
Purchasers.
Very truly yours,
AMERICAN COMMUNICATIONS SERVICES,
INC.
By: /s/ Xxxxx X. Xxxxxx
Name: Xxxxx X. Xxxxxx
Title: Executive Vice President/Secretary
The foregoing Agreement is hereby
confirmed and accepted as of the
date first above written.
THE XXXX ALTERNATIVE INCOME FUND, L.P.
By: WRH PARTNERS, L.L.C., General Partner
By: /s/ Xxxxxx X. Xxxxxxxx
Name: Xxxxxx X. Xxxxxxxx
Title: Attorney-in-Fact
GENERAL MOTORS DOMESTIC GROUP PENSION TRUST
By: MELLON BANK N.A. Solely in its
Capacity as Trustee for the
General Motors Domestic Group
Pension Trust (as directed by
General Motors Investment Management Corp.)
and not in its individual capacity
By: /s/Xxxxxx X. Xxxxx
Name: Xxxxxx X. Xxxxx
Title: Trust Officer
XXXXXXXXX INC. MASTER TRUST
By: /s/ Xxxxx X. Xxxxxx
Name: Xxxxx X. Xxxxxx
Title: Agent of the Investment Committee
SOCIETE GENERALE SECURITIES CORPORATION
By: /s/ Xxxxx X. Xxxxxxx
Name: Xxxxx X. Xxxxxxx
Title: Managing Director
ING BARING [U.S.] SECURITIES, INC.
By: /s/ X. Xxxxx
Name: X. Xxxxx
Title: Assistant Secretary
SCHEDULE 1
Number
Purchaser of Units Purchase Price
The Xxxx Alternative Income 10,000 $ 9,550,000
Fund, L.P.
1776 On the Green
00 Xxxx Xxxxx
Xxxxxxxxxx, XX 00000
Attn: Xxxxxx X. Xxxxxxxx, Esq.
General Motors Domestic Group 20,000 19,100,000
Pension Trust
1 Mellon Bank Center
000 Xxxxx Xxxxxx 0000
Xxxxxxxxxx, XX 00000-0000
Attn: Xxxxxx Xxxxx
XxXxxxxxx Inc. Master Trust 1,000 955,000
P.O. Box N 7796
Norfolk House
Frederick Street
Nassau, Bahamas
Attn: Xxxxxxx Xxxxx
Societe Generale Securities 7,500 7,500,000
Corporation
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 00000
Attn: Xxx Xxxxxxxxxx
ING Baring [U.S.] Securities, Inc. 7,500 7,500,000
000 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attn: Legal Department
------ -----------
Total 46,000 44,605,000
