Exhibit 1
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MASTER RESTRUCTURING AND INVESTMENT AGREEMENT
Among
SPRINT CORPORATION,
FRANCE TELECOM S.A.
and
DEUTSCHE TELEKOM AG
Dated as of May 26, 1998
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TABLE OF CONTENTS
Page
ARTICLE I CLOSINGS; PURCHASE AND SALE OF SHARES..................1
Section 1.1. The Primary Closing......................1
Section 1.2. The Secondary Closing....................3
Section 1.3. The Greenshoe Closing....................4
Section 1.4. Purchase and Sale of Shares at
the Primary Closing......................5
Section 1.5. Purchase and Sale of Shares at
the Secondary and Greenshoe Closings.....6
Section 1.6. Antidilution.............................6
Section 1.7. Reduction of Purchased Shares............7
Section 1.8. Effect of Conversion.....................7
Section 1.9. Relationship of Purchases Under
this Agreement to CP Top Ups.............7
Section 1.10. Effect on Stockholders' Agreement........7
ARTICLE II CONDITIONS TO CLOSINGS.................................7
Section 2.1. Conditions of All Parties to
Primary Closing..........................8
Section 2.2. Sprint's Conditions Precedent to
the Primary Closing......................9
Section 2.3. Conditions Precedent to the
Primary Closing for FT and DT...........10
Section 2.4. Conditions Precedent to
Secondary and Greenshoe Closings
During the Anticipated IPO Period.......12
Section 2.5. Conditions Precedent to Secondary
and Greenshoe Closings After the
Anticipated IPO Period..................14
ARTICLE III REPRESENTATIONS AND WARRANTIES OF SPRINT.............16
Section 3.1. Organization, Qualification, Etc........16
Section 3.2. Capital Stock and Other Matters.........16
Section 3.3. Validity of Shares......................16
Section 3.4. Corporate Authority; No
Violation...............................17
Section 3.5. No Conflict; No Default.................18
Section 3.6. Sprint Reports and Financial
Statements..............................18
Section 3.7. Absence of Certain Changes
or Events...............................19
Section 3.8. Litigation..............................19
Section 3.9. Proxy Statement; Other
Information.............................20
Section 3.10. Certain Tax Matters.....................20
Section 3.11. Amendments to the
Rights Agreement........................20
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Section 3.12. Other Registration Rights...............21
Section 3.13. Takeover Statutes.......................21
Section 3.14. Vote Required; Board
Recommendation..........................22
Section 3.15. Sprint Board Action.....................22
Section 3.16. King & Spalding Opinion.................22
Section 3.17. PCS Restructuring Agreement.............22
ARTICLE IV REPRESENTATIONS AND WARRANTIES OF
THE BUYERS............................................22
Section 4.1. Representations and Warranties of FT....22
Section 4.2. Representations and Warranties of DT....25
ARTICLE V COVENANTS.............................................27
Section 5.1. Cooperation.............................27
Section 5.2. Certain Actions by Sprint...............29
Section 5.3. IPO Matters.............................31
Section 5.4. Tax Matters.............................31
Section 5.5. Brokers or Finders......................31
Section 5.6. No Action Relating to
Takeover Statutes; Applicability
of Future Statutes and
Regulations.............................32
Section 5.7. Management and Allocation Policies......32
Section 5.8. Sprint Action...........................32
Section 5.9. Standstill Agreement....................32
ARTICLE VI TERMINATION; ABANDONMENT..............................33
Section 6.1. Events of Termination...................33
Section 6.2. Effect of Termination...................34
Section 6.3. Reimbursement of Expenses...............34
Section 6.4. Abandonment of Purchase
and Sale of Capital Stock
at Primary Closing......................34
Section 6.5. Abandonment of Secondary
Closing and Greenshoe Closing...........35
ARTICLE VII MISCELLANEOUS.......................................36
Section 7.1. Survival of Representations
and Warranties..........................36
Section 7.2. Assignment..............................37
Section 7.3. Entire Agreement........................37
Section 7.4. Expenses................................38
Section 7.5. Waiver, Amendment, Etc..................38
Section 7.6. Binding Agreement; No Third
Party Beneficiaries.....................38
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Section 7.7. Notices.................................38
Section 7.8. Governing Law; Dispute Resolution;
Equitable Relief........................40
Section 7.9. Severability............................41
Section 7.10. Translation.............................41
Section 7.11. Table of Contents; Headings;
Counterparts............................42
Section 7.12. Waiver of Immunity......................42
Section 7.13. Continuing Director Approval............42
Section 7.15. Currency................................43
ARTICLE VIII DEFINITIONS........................................43
Section 8.1 Certain Definitions.....................43
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MASTER RESTRUCTURING AND INVESTMENT AGREEMENT
MASTER RESTRUCTURING AND INVESTMENT AGREEMENT, dated as of
May 26, 1998 (the "Agreement"), among Sprint Corporation, a
corporation organized under the laws of Kansas ("Sprint"); France
Telecom S.A., a societe anonyme formed under the laws of France
("FT"); and Deutsche Telekom AG, an Aktiengesellschaft formed
under the laws of Germany ("DT" and, with FT, the "Buyers").
RECITALS
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WHEREAS, Sprint, FT and DT entered into an Investment
Agreement dated as of July 31, 1995, as amended (the "Original
Investment Agreement"), pursuant to which the Buyers purchased
shares of capital stock of Sprint;
WHEREAS, concurrently with the execution and delivery of
this Agreement, Sprint is entering into the PCS Restructuring
Agreement, which provides for, among other things, (i) the CP
Exchange, (ii) the IPO and (iii) the Recapitalization
(capitalized terms used herein but not previously defined have
the meanings set forth in Article VIII of this Agreement); and
WHEREAS, in connection with the transactions contemplated
herein and in the PCS Restructuring Agreement, Sprint and the
Buyers desire to make certain changes to various existing
agreements among the Buyers and Sprint, and the Buyers desire to
purchase certain shares of capital stock from Sprint, all in
accordance with the terms and conditions hereof.
NOW, THEREFORE, in consideration of the foregoing and the
mutual covenants and agreements set forth herein, each of FT, DT
and Sprint (each a "Party" and collectively the "Parties") agrees
as follows:
ARTICLE I
CLOSINGS; PURCHASE AND SALE OF SHARES
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Section 1.1. The Primary Closing. The Primary Closing shall
take place at the offices of King & Xxxxxxxx, 0000 Avenue of the
Americas, New York, New York, at 10:00 a.m. (local time at the
place of the Primary Closing) on the date of the consummation of
the earlier to occur of the IPO or the Recapitalization, as the
case may be, or at such other location or on such other date or
time as the Parties hereto shall agree. On the Primary Closing
Date, (i) the CP Closing will occur, (ii) either the IPO or the
Recapitalization will be consummated, (iii) if the conditions to
Primary Closing specified in Sections 2.1(b) and 2.3(b) are
satisfied or waived prior to the Primary Closing, the purchase
and sale of shares of capital stock of Sprint contemplated by
Section 1.4 shall be consummated, and (iv) the Parties will take
the following actions:
(a) The Initial Charter Amendment and (if the
Recapitalization is to occur on the Primary Closing Date)
the Subsequent Charter Amendment shall be filed with the
Kansas Governmental Authorities.
(b) Sprint shall deliver to each of FT and DT a copy
of the Bylaw Amendment and the resolutions adopted by
Sprint's Board of Directors in connection with the
transactions contemplated by this Agreement, certified by
the Secretary or an Assistant Secretary of Sprint.
(c) Sprint and the Buyers shall deliver to each other
a certificate to the effect that the representations and
warranties of such Party are accurate in all material
respects on the Primary Closing Date with the same effect
as if made on the Primary Closing Date (except that any
such statements which are expressly made as of a particular
date shall have been accurate as of such particular date
and except to the extent contemplated or permitted by this
Agreement or the PCS Restructuring Agreement).
(d) Sprint and the Buyers shall deliver to each other
a certificate that the covenants and agreements contained
herein that are required to be performed by such Party on
or prior to the Primary Closing have been performed in all
material respects.
(e) if the conditions to the Primary Closing specified
in Sections 2.1(b) and 2.3(b) are satisfied or waived prior
to the Primary Closing, certificates representing the
shares of Series 3 PCS Stock to be issued to FT at the
Primary Closing shall be delivered by Sprint to FT.
(f) if the conditions to the Primary Closing specified
in Sections 2.1(b) and 2.3(b) are satisfied or waived prior
to the Primary Closing, certificates representing the
shares of Series 3 PCS Stock to be issued to DT at the
Primary Closing shall be delivered by Sprint to DT.
(g) if the conditions to the Primary Closing specified
in Sections 2.1(b) and 2.3(b) are satisfied or waived prior
to the Primary Closing, cash (or, if the IPO does not occur
on the Primary Closing Date, Top Up Notes or a combination
of cash and Top Up Notes) in the amount of one-half of the
purchase price for the shares of Series 3 PCS Stock being
purchased by FT and DT on the Primary Closing Date shall be
delivered by each of FT and DT, such cash (if applicable)
to be delivered by wire transfer of immediately available
funds to an account designated by Sprint to FT and DT at
least five Business Days prior to the Primary Closing Date.
(h) The Amended and Restated Stockholders' Agreement,
in form reasonably satisfactory to each of the Parties
shall be executed and delivered by each Party in the
English and French languages.
(i) The Amended and Restated Registration Rights
Agreement, in form reasonably satisfactory to each of the
Parties, shall be executed and delivered by each Party in
the English and French languages.
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(j) The Amended and Restated Standstill Agreement, in
form reasonably satisfactory to each of the Parties, shall
be executed and delivered by each Party in the English and
French languages.
(k) The Amended and Restated DT Investor
Confidentiality Agreement, in form reasonably satisfactory
to each of the Parties, shall be executed and delivered by
DT and Sprint in the English language.
(l) The Amended and Restated FT Investor
Confidentiality Agreement, in form reasonably satisfactory
to each of the Parties, shall be executed and delivered by
FT and Sprint in the English and French languages.
All of the actions contemplated to occur at the Primary Closing
shall be deemed to have occurred simultaneously, and none of such
actions shall be effective unless all of such actions have
occurred or are waived by the necessary Parties. Notwithstanding
anything to the contrary in this Agreement, (i) the failure of
any of the conditions set forth in Sections 2.1(b) or 2.3(b) to
be satisfied or waived prior to or at the Primary Closing shall
not affect the Buyers' obligations under Article V to vote (or
cause to be voted) the shares of capital stock of Sprint they own
(directly or indirectly) in favor of the Initial Charter
Amendment, the Subsequent Charter Amendment, this Agreement, the
Amended Other Agreements, the PCS Restructuring Agreement and the
transactions contemplated hereby and thereby and any other
matters related thereto presented for a vote at the Stockholders
Meeting (including any class vote of the Class A Holders required
thereat or in connection therewith), and their agreement not to
exercise any disapproval rights which they may have under the
Articles or otherwise with respect to any such matters, (ii) the
failure of any of the conditions set forth in Sections 2.1(b) or
2.3(b) to be satisfied or waived prior to or at the Primary
Closing shall not affect the Parties' obligations to proceed with
all of the transactions and deliveries contemplated to be
undertaken at the Primary Closing (other than the purchase and
sale by the Buyers of the capital stock of Sprint), and such
transactions and deliveries in fact shall proceed if all of the
other conditions to the Primary Closing have been satisfied or
waived, and (iii) if the conditions to the purchase and sale of
the capital stock of Sprint at the Primary Closing are not
satisfied or waived prior to or at the Primary Closing, unless
this Agreement is otherwise terminated in accordance with its
terms, the purchase and sale by the Buyers of the capital stock
of Sprint contemplated to be purchased at the Primary Closing
shall occur on the fifth Business Day (unless the Parties
otherwise agree) following the satisfaction of all such
conditions to the purchase and sale of such capital stock.
Section 1.2. The Secondary Closing. If Sprint determines to
proceed with the IPO after the Primary Closing Date, the
Secondary Closing shall take place at the offices of King &
Xxxxxxxx, 0000 Avenue of the Americas, New York, New York, at
10:00 a.m. (local time at the place of the Secondary Closing) on
the date determined by Sprint in accordance with Section 5.2(d)
or at such other location or on such other date or time as Sprint
may determine. At the Secondary Closing, (i) the IPO will be
consummated, and (ii) if the conditions to the Secondary Closing
specified in Section 2.4 or 2.5, as applicable, are satisfied or
waived prior to the Secondary Closing, the purchase
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and sale of shares of capital stock of Sprint contemplated by
Section 1.5 to occur at the Secondary Closing shall be
consummated, and the Parties will take the following actions:
(a) Sprint shall deliver to the Buyers the certificate
contemplated by Section 2.4(b)(iv), and the Buyers shall
deliver to Sprint the certificates contemplated by Section
2.4(c)(iii).
(b) Certificates representing the shares of Series 3
PCS Stock to be issued to FT at the Secondary Closing shall
be delivered by Sprint to FT.
(c) Certificates representing the shares of Series 3
PCS Stock to be issued to DT at the Secondary Closing shall
be delivered by Sprint to DT.
(d) Cash in the amount of one-half of the purchase
price for such shares of Series 3 PCS Stock being purchased
shall be delivered by each of FT and DT, such cash to be
delivered by wire transfer of immediately available funds
to an account designated by Sprint to FT and DT at least
five Business Days prior to the Secondary Closing Date.
All of the actions contemplated to occur at the Secondary Closing
shall be deemed to have occurred simultaneously, and none of such
actions shall be effective unless all of such actions have
occurred or are waived by the necessary Parties. Notwithstanding
anything to the contrary in this Agreement, but subject to the
provisions of Section 6.5, if the conditions to the purchase and
sale of the capital stock of Sprint at the Secondary Closing are
not satisfied or waived prior to or at the Secondary Closing the
purchase and sale by the Buyers of the capital stock of Sprint
contemplated to be purchased at the Secondary Closing shall occur
on the fifth Business Day (unless the Parties otherwise agree)
following the satisfaction of all such conditions to the purchase
and sale of the capital stock.
Section 1.3. The Greenshoe Closing. If the underwriters for
the IPO exercise an over-allotment option in connection with the
IPO (the "Greenshoe") after either the Primary Closing Date or
the Secondary Closing Date, the Greenshoe Closing shall take
place at the offices of King & Xxxxxxxx, 0000 Avenue of the
Americas, New York, New York, at 10:00 a.m. (local time at the
place of the Greenshoe Closing) on the date determined by Sprint
in accordance with the terms of any underwriting agreement
entered into by Sprint in connection with the IPO or at such
other location or on such other date or time as Sprint may
determine. At the Greenshoe Closing, (i) the over-allotment
option granted to the underwriters will be consummated, and (ii)
if the conditions to the Greenshoe Closing specified in Section
2.4 or 2.5, as applicable, are satisfied or waived prior to the
Greenshoe Closing, the purchase and sale of shares of capital
stock of Sprint contemplated by Section 1.5 to occur at the
Greenshoe Closing shall be consummated, and the Parties will take
the following actions:
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(a) Sprint shall deliver to the Buyers the certificate
contemplated by Section 2.4(b)(iii), and the Buyers shall
deliver to Sprint the certificates contemplated by Section
2.4(c)(iii).
(b) Certificates representing the shares of Series 3
PCS Stock to be issued to FT at the Greenshoe Closing shall
be delivered by Sprint to FT.
(c) Certificates representing the shares of Series 3
PCS Stock to be issued to DT at the Greenshoe Closing shall
be delivered by Sprint to DT.
(d) Cash in the amount of one-half of the purchase
price for such shares of Series 3 PCS Stock being purchased
shall be delivered by each of FT and DT, such cash to be
delivered by wire transfer of immediately available funds
to an account designated by Sprint to FT and DT at least
five Business Days prior to the Greenshoe Closing Date.
All of the actions contemplated to occur at the Greenshoe Closing
shall be deemed to have occurred simultaneously, and none of such
actions shall be effective unless all of such actions have
occurred or are waived by the necessary Parties. Notwithstanding
anything to the contrary in this Agreement, but subject to the
provisions of Section 6.5, if the conditions to the purchase and
sale of the capital stock of Sprint at the Greenshoe Closing are
not satisfied or waived prior to or at the Greenshoe Closing the
purchase and sale by the Buyers of the capital stock of Sprint
contemplated to be purchased at the Greenshoe Closing shall occur
on the fifth Business Day (unless the Parties otherwise agree)
following the satisfaction of all such conditions to the purchase
and sale of the capital stock.
Section 1.4. Purchase and Sale of Shares at the Primary
Closing. Upon the terms and subject to the conditions of this
Agreement, Sprint shall issue, sell and deliver to each of FT and
DT, and each of FT and DT, severally and not jointly, shall
purchase and accept, shares of Series 3 PCS Stock at the Primary
Closing as set forth below in this Section 1.4:
(a) Subject to Sections 1.6, 1.7, 1.8 and 1.9, FT and
DT shall purchase that number of whole shares (rounded up
to the nearest whole share) of Series 3 PCS Stock
sufficient for FT and DT to have acquired Beneficial
Ownership, in the aggregate, equal to 25% of the aggregate
Voting Power attributable to the shares of Series 1 PCS
Stock, Series 2 PCS Stock and PCS Preferred Stock issued in
the CP Exchange, the IPO (if the IPO occurs on the Primary
Closing Date), the CP/IPO Top Up Purchase (if the IPO
occurs on the Primary Closing Date), the PCS Preferred
Issuance, and the CP/FT-DT Top Up Purchase to be effected
at the Primary Closing. Such shares shall be purchased at
the applicable price specified below in this Section 1.4(a)
and determined at the date of the Primary Closing as
follows:
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(i) if Sprint elects to complete the IPO on the
Primary Closing Date, the purchase price per share of
such shares of Series 3 PCS Stock shall be the IPO
Price net of any underwriting discounts in connection
with the IPO, which purchase price shall be paid in
cash in immediately available funds.
(ii) if Sprint elects to complete the
Recapitalization on the Primary Closing Date and prior
to the IPO, then the purchase price per share of such
shares of Series 3 PCS Stock shall be an amount equal
to the Volume Weighted Trading Average of the Series 1
PCS Stock for the period of 20 consecutive Trading
Days following the commencement of regular way trading
in connection with the Recapitalization, which
purchase price shall be paid by the issuance to Sprint
by FT and DT of Top Up Notes or a combination of cash
and Top Up Notes.
(b) Each of FT and DT agrees to purchase one-half of
the shares of Series 3 PCS Stock to be purchased pursuant
to Section 1.4(a). The purchase of shares of capital stock
by FT and DT pursuant to this Section 1.4 shall be
consummated concurrently, and no purchase of shares by FT
or DT pursuant to this Section 1.4 shall be made unless and
until the concurrent purchase by the other Party is so
effected.
Section 1.5. Purchase and Sale of Shares at the Secondary
and Greenshoe Closings. Upon the terms and subject to the
conditions of this Agreement, if the Secondary Closing or the
Greenshoe Closing occurs, subject to Sections 1.6, 1.7, 1.8 and
1.9, Sprint shall issue, sell and deliver to each of FT and DT,
and each of FT and DT, severally and not jointly, shall purchase
and accept, at the Secondary Closing or the Greenshoe Closing, as
the case may be, that number of whole shares (rounded up to the
nearest whole share) of Series 3 PCS Stock sufficient for FT and
DT to have acquired Beneficial Ownership, in the aggregate, equal
to 25% of the aggregate Voting Power attributable to the shares
of Series 1 PCS Stock and Series 2 PCS Stock issued (i) in the
case of the Secondary Closing, in the IPO (if the IPO occurs on
the Secondary Closing Date), the CP/IPO Top Up Purchase (if the
IPO occurs on the Secondary Closing Date), and the CP/FT-DT Top
Up Purchase to be effected at the Secondary Closing, and (ii) in
the case of the Greenshoe Closing, in the Greenshoe, the
CP/Greenshoe Top Up Purchase and the CP/FT-DT Top Up Purchase to
be effected at the Greenshoe Closing. Such shares shall be
purchased at the IPO Price net of any underwriting discounts in
connection with the IPO. Each of FT and DT agrees to purchase
one-half of the shares of Series 3 PCS Stock to be purchased
pursuant to this Section 1.5. The purchase of shares of capital
stock by FT and DT pursuant to this Section 1.5 shall be
consummated concurrently, and no purchase of shares by FT or DT
pursuant to this Section 1.5 shall be made unless and until the
concurrent purchase by the other Party is so effected.
Section 1.6. Antidilution. The number of shares of Series 3
PCS Stock to be purchased by the Buyers hereunder and the
purchase price therefor shall be adjusted to reflect any stock
split, subdivision, stock dividend, or other reclassification,
consolidation or a combination of the Voting Securities of Sprint
or similar action or transaction after the date hereof, provided
that no adjustment shall be made under this Section 1.6 in
respect of the Recapitalization.
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Section 1.7. Reduction of Purchased Shares. At any
Applicable Closing, the number of shares of Series 3 PCS Stock to
be purchased by FT and DT hereunder shall be reduced by the
minimum number of shares, if any, necessary so that, following
such Applicable Closing, FT and DT and their respective
Affiliates shall Beneficially Own in the aggregate (rounded up to
the nearest whole share) 20% of the sum of (a) the aggregate
number of Votes of Sprint outstanding at that time (giving effect
to any other issuances of Voting Securities of Sprint to take
place concurrently with such Applicable Closing) and (b) the
aggregate number of Votes represented by the Voting Securities of
Sprint which FT and DT and their respective Affiliates have
committed to purchase from Sprint (but not including any Voting
Securities of Sprint to be purchased by FT and DT under this
Agreement, other than Voting Securities which have been purchased
prior to the Applicable Closing or which will be purchased at
such Applicable Closing). Any reduction in shares pursuant to
this Section 1.7 shall be borne one-half by each of FT and DT.
Section 1.8. Effect of Conversion. If after the date hereof
all outstanding shares of Class A Stock shall have been converted
into Non-Class A Common Stock pursuant to the Class A Provisions,
each share of Series 3 PCS Stock to have been issued by Sprint
pursuant to this Agreement shall instead be issued as one duly
issued, fully paid and nonassessable share of Series 1 PCS Stock.
Section 1.9. Relationship of Purchases Under this Agreement
to CP Top Ups. In connection with the exercise by FT and DT of
their rights under this Agreement to purchase shares of capital
stock of Sprint at each Applicable Closing, Sprint shall use its
reasonable efforts to coordinate the exercise of purchase rights
by the Cable Partners and FT and DT to avoid a series of
successive exercises of purchase rights triggered by a single
issuance.
Section 1.10. Effect on Stockholders' Agreement. To the
extent FT and DT purchase shares of Sprint capital stock pursuant
to this Agreement in respect of the CP Exchange, the IPO, the
Greenshoe, the CP/FT-DT Top Up, the CP/IPO Top Up, the
CP/Greenshoe Top Up and/or the issuance of the PCS Preferred
Stock, such purchase shall be in lieu of the Equity Purchase
Rights which FT and DT otherwise would have had under the
Stockholders' Agreement and the Amended and Restated
Stockholders' Agreement as a result of such events, and no such
Equity Purchase Rights as a result of such events may be
exercised under such documents with respect to the transactions
contemplated by this Agreement except to the extent that FT and
DT do not purchase shares of capital stock in respect of such
events because this Agreement is terminated or the Secondary
Closing or Greenshoe Closing is abandoned.
ARTICLE II
CONDITIONS TO CLOSINGS
----------------------
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Section 2.1. Conditions of All Parties to Primary Closing.
(a) The respective obligations of each Party to
consummate the transactions contemplated by this Agreement
to occur at the Primary Closing (other than the purchase
and sale of the capital stock of Sprint to be acquired by
FT and DT hereunder) are subject to the fulfillment at or
prior to the Primary Closing Date of each of the following
conditions, any or all of which may be waived in whole or
in part by the Party being benefitted thereby, to the
extent permitted by applicable Law:
(i) The matters presented for a vote of the
stockholders of Sprint at the Stockholders Meeting as
contemplated by Section 5.2(b) shall have been duly
approved by the requisite holders of capital stock of
Sprint in accordance with applicable Law and the
Articles and Bylaws of Sprint.
(ii) The CP Closing shall be consummated
simultaneously with the Primary Closing.
(iii) No preliminary or permanent injunction or
other order, decree or ruling issued by a Governmental
Authority, nor any statute, rule, regulation or
executive order promulgated or enacted by any
Governmental Authority, shall be in effect that
enjoins the actions to be effected at the Primary
Closing under clauses (a) and (b) and (h) through (m)
only of Section 1.1 of this Agreement or the
transactions contemplated by the PCS Restructuring
Agreement.
(iv) The IPO or the Recapitalization (whichever
Sprint has elected to complete concurrently with the
CP Exchange on the Primary Closing Date) shall be
consummated simultaneously with the Primary Closing.
(v) The Initial Charter Amendment and (if the
Recapitalization is to occur concurrently with the CP
Exchange) the Subsequent Charter Amendment shall have
been filed with the Kansas Secretary of State.
(b) The respective obligations of each Party to
consummate the purchase and sale of the capital stock of
Sprint to be purchased by FT and DT hereunder at the
Primary Closing are subject to the fulfillment at or prior
to the Primary Closing Date of each of the conditions
specified in Section 2.1(a) and each of the following
additional conditions, any or all of which may be waived in
whole or in part by the Party being benefitted thereby, to
the extent permitted by applicable Law:
(i) All consents, if any, required from the
Federal Communications Commission in order to permit
the purchase and sale of the shares of capital stock
of Sprint to be purchased by FT and DT at the Primary
Closing shall have been granted,
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in each case without any material limitation,
restriction, requirement or condition on Sprint, FT or
DT.
(ii) FT shall have received all approvals, if
any, of the French minister in charge of economic
affairs and finance (ministre charge de l'economie et
des finances) and all approvals, if any, of the French
minister in charge of posts and telecommunications
(ministre charge des postes et des telecommunications)
required in order to permit the purchase and sale of
the shares of capital stock of Sprint to be purchased
by FT and DT at the Primary Closing.
(iii) DT shall have received all approvals, if
any, of the Bundeskartellamt required in order to
permit the purchase and sale of the shares of capital
stock of Sprint to be purchased by FT and DT at the
Primary Closing.
(iv) All other material Governmental Approvals,
if any, required in order to permit the purchase and
sale of the shares of capital stock of Sprint to be
purchased by FT and DT at the Primary Closing shall
have been received.
(v) No Change of Control shall have occurred.
Section 2.2. Sprint's Conditions Precedent to the Primary
Closing. The obligations of Sprint to effect the transactions
contemplated by this Agreement to occur at the Primary Closing
(including the purchase and sale of the capital stock of Sprint
to be acquired by FT and DT hereunder at the Primary Closing) are
subject to the satisfaction, on or prior to the Primary Closing
Date, of each of the following conditions, compliance with which
or the occurrence of which may be waived in whole or in part by
Sprint:
(a) The representations and warranties of each of FT
and DT contained in this Agreement shall be accurate in all
material respects on the Primary Closing Date with the same
effect as if made on the Primary Closing Date (except that
any such statements which are expressly made as of a
particular date shall have been accurate as of such
particular date and except to the extent contemplated or
permitted by this Agreement or the PCS Restructuring
Agreement). At the Primary Closing, Sprint shall be
provided with a certificate to such effect from each of FT
and DT, signed by a duly authorized officer thereof.
(b) All covenants and agreements of each of FT and DT
contained in this Agreement and required to be performed on
or prior to the Primary Closing Date shall have been
performed in all material respects on or prior to the
Primary Closing. At the Primary Closing, Sprint shall be
provided with a certificate to such effect from each of FT
and DT, signed by a duly authorized officer thereof.
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(c) There shall not have occurred any change in
applicable Law or any change in facts beyond Sprint's
reasonable control, in either case occurring after the date
hereof, that would prevent King & Spalding from reaffirming
to Sprint on the Primary Closing Date its opinion described
in Section 3.7. For purposes of this Section 2.2(c), Law
also includes any Revenue Ruling, proposed regulations or
official notice of intent to propose regulations issued by
the Internal Revenue Service, or a xxxx introduced in the
House of Representatives or Senate of the United States or
legislation proposed by the United States Treasury
Department.
(d) Each of the Amended Other Agreements shall have
been executed by the Buyers which are parties thereto and
delivered to Sprint.
Section 2.3. Conditions Precedent to the Primary Closing
for FT and DT.
(a) The obligations of each of FT and DT to effect the
transactions contemplated by this Agreement to occur at the
Primary Closing (other than the purchase and sale of the
capital stock of Sprint to be acquired by FT and DT
hereunder at the Primary Closing) are subject to the
satisfaction, on or prior to the Primary Closing Date, of
the following conditions, compliance with which or the
occurrence of which may be waived in whole or in part by FT
and DT:
(i) All representations and warranties of Sprint
(other than the representations and warranties set
forth in Sections 3.6, 3.7 and 3.8) shall be accurate
in all material respects on the Primary Closing Date
with the same effect as if made on the Primary Closing
Date (except that any such statements which are
expressly made as of a particular date shall have been
accurate as of such particular date and except to the
extent contemplated or permitted by this Agreement or
the PCS Restructuring Agreement). At the Primary
Closing, FT and DT shall be provided with a
certificate to such effect from Sprint, signed by a
duly authorized officer thereof.
(ii) All covenants and agreements of Sprint
contained in this Agreement and required to be
performed on or prior to the Primary Closing Date
shall have been performed in all material respects on
or prior to the Primary Closing. At the Primary
Closing, FT and DT shall be provided with a
certificate to such effect from Sprint, signed by a
duly authorized officer thereof.
(iii) Sprint shall have amended its Articles in
accordance with the Initial Charter Amendment and (if
the Recapitalization is to occur on the Primary
Closing Date) the Subsequent Charter Amendment.
(iv) Sprint shall have duly adopted the Bylaw
Amendment and such amended terms shall be in full
force and effect.
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(v) Each of the Amended Other Agreements shall
have been executed by Sprint and delivered to the
Buyers which are parties thereto.
(vi) The Board of Directors shall have taken
appropriate action so that the provisions of Kan.
Stat. Xxx. Section 17-12,101 (the "Business
Combination Statute") restricting "business
combinations" with "interested stockholders" (each as
defined in Kan. Stat. Xxx. Section 17-12,100) will not
apply to FT, DT or any Person who as of the date
hereof is an Affiliate of FT or DT with respect to the
purchase and sale of shares of capital stock of Sprint
pursuant to and permitted by this Agreement and the
Amended Other Agreements.
(vii) The Series 1 FON Stock and Series 1 PCS
Stock issuable upon conversion of the Class A Stock to
be issued pursuant to this Agreement shall have been
approved for listing on the New York Stock Exchange,
or if not so approved, shall have been approved for
listing on the American Stock Exchange or approved for
quotation on the National Association of Securities
Dealers Automated Quotations National Market System
subject to official notice of issuance.
(viii) Each of the Buyers shall have received
opinions dated as of the Primary Closing Date, from
counsel to the Company reasonably satisfactory to the
Buyers, in form reasonably satisfactory to the
Parties.
(b) The obligations of each of FT and DT to effect the
purchase and sale of the capital stock of Sprint to be
acquired by FT and DT hereunder at the Primary Closing are
subject to the satisfaction, on or prior to the Primary
Closing Date, of each of the conditions specified in
Section 2.3(a) and each of the following conditions,
compliance with which or the occurrence of which may be
waived in whole or in part by FT and DT:
(i) The representations and warranties of Sprint
set forth in Sections 3.6, 3.7 and 3.8 shall be
accurate in all material respects on the Primary
Closing Date with the same effect as if made on the
Primary Closing Date (except that any such statements
which are expressly made as of a particular date shall
have been accurate as of such particular date and
except to the extent contemplated or permitted by this
Agreement or the PCS Restructuring Agreement). At the
Primary Closing, FT and DT shall be provided with a
certificate to such effect from Sprint, signed by a
duly authorized officer thereof.
(ii) There shall not have occurred after the date
hereof any change in applicable Law that would cause
the Recapitalization to be deemed taxable to FT or DT
under French or German tax law.
-11-
(iii) Unless FT and DT have otherwise consented in
writing, the PCS Restructuring Agreement shall not
have been amended in a manner which fundamentally
changes the transactions contemplated by the PCS
Restructuring Agreement or which is materially adverse
to FT and DT.
Section 2.4. Conditions Precedent to Secondary and
Greenshoe Closings During the Anticipated IPO Period.
(a) If the IPO occurs within 180 days following the CP
Exchange, the respective obligations of each Party to
consummate the transactions contemplated by this Agreement
to occur at each of the Secondary Closing and the Greenshoe
Closing are subject to the fulfillment at or prior to each
of the Secondary Closing Date and Greenshoe Closing Date,
respectively, of the following conditions, which may be
waived in whole or in part by the Party being benefitted
thereby, to the extent permitted by applicable Law:
(i) No preliminary or permanent injunction or
other order, decree or ruling issued by a Governmental
Authority, nor any statute, rule, regulation or
executive order promulgated or enacted by any
Governmental Authority, shall be in effect that
enjoins the consummation of the transactions to be
effected at the Secondary Closing or the Greenshoe
Closing, as the case may be.
(ii) All material Governmental Approvals, if any,
required in order to permit the purchase and sale of
the shares of capital stock of Sprint to be purchased
by FT and DT at the Secondary Closing or the Greenshoe
Closing, as the case may be, shall have been received.
(b) If the IPO occurs within 180 days following the CP
Exchange, the obligation of each Buyer to consummate the
transactions contemplated hereby at a Secondary Closing or
Greenshoe Closing is subject to the fulfillment of each of
the following conditions on or prior to the date of such
Secondary Closing or Greenshoe Closing:
(i) The representations and warranties of Sprint
set forth in Sections 3.1, 3.2(a), 3.3, 3.4 and 3.5
shall be true and correct in all material respects at
and as of the date hereof and at and as of the date of
such Secondary Closing or Greenshoe Closing, as the
case may be, as if such representations and warranties
were made at and as of such date except (x) with
respect to representations and warranties that relate
solely to a date prior to such date, and were true and
correct in all material respects on such prior date,
and (y) to the extent contemplated or permitted by
this Agreement, the PCS Restructuring Agreement, the
Amended Other Agreements or the Articles.
-12-
(ii) The first two sentences of Section 3.6(a)
(as to SEC Documents filed prior to the Applicable
Closing) and Section 3.7 (but in the case of Section
3.7 only as to changes prior to the Applicable
Closing, but after the later of (x) the end of the
quarter covered by the last Quarterly Report on Form
10-Q of Sprint filed prior to the Applicable Closing,
and (y) the end of the year covered by the last Annual
Report on Form 10-K of Sprint filed prior to the
Applicable Closing) shall be true and correct in all
material respects at and as of the date of the
Secondary Closing or the Greenshoe Closing, as the
case may be, except to the extent such failure to be
true and correct does not relate to, and is not
reasonably likely to relate to, a material adverse
change in the business, operations, results of
operations, financial condition, assets or liabilities
of Sprint compared to the last to be filed prior to
the Applicable Closing of the Annual Report on Form
10-K of Sprint or the Quarterly Report on Form 10-Q of
Sprint.
(iii) Sprint shall have performed and complied in
all material respects with its obligations under
Section 5.6 of this Agreement; Article FIFTH of the
Articles (to the extent such Article relates to the
rights of the holders of Class A Stock); the Class A
Provisions; and Articles III, IV, V and VI, and
Sections 7.1, 7.4, 7.8, 7.10 and 7.11 of the
Stockholders' Agreement and the Amended and Restated
Stockholders' Agreement.
(iv) Sprint shall have delivered to the Buyers a
certificate, dated the date of such Secondary Closing
or Greenshoe Closing, as the case may be, signed by a
duly authorized senior officer of Sprint, certifying
that the conditions specified in Sections 2.4(b)(i)
and (ii) have been fulfilled.
(v) No Change of Control shall have occurred.
(vi) There shall not have occurred after the date
hereof any change in applicable Law that would cause
the Recapitalization to be deemed taxable to FT or DT
under French and German tax law.
(c) The obligation of Sprint to consummate the
transactions contemplated hereby at a Secondary Closing or
Greenshoe Closing is subject to the fulfillment of each of
the following conditions on or prior to the date of such
Secondary Closing or Greenshoe Closing:
(i) The representations and warranties of the
Buyers set forth in Sections 4.1(a), 4.1(b), 4.1(d),
4.1(g), 4.2(a), 4.2(b), 4.2(d) and 4.2(g) shall be
true and correct in all material respects at and as of
the date hereof and at and as of the date of such
Secondary Closing or Greenshoe Closing, as the case
may be, as if such representations and warranties were
made at and as of such date except (x) with respect to
representations and warranties that relate solely to a
date prior to such date,
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and were true and correct in all material respects on
such prior date, and (y) to the extent contemplated or
permitted by this Agreement, the PCS Restructuring
Agreement, the Amended Other Agreements or the
Articles.
(ii) Each of the Buyers shall have performed and
complied in all material respects with its obligations
under Article I of this Agreement, Article II and
Section 7.5 of the Stockholders' Agreement and the
Amended and Restated Stockholders' Agreement, Sections
2.1, 3.1 and 3.2(b) of the Standstill Agreement and
the Amended and Restated Standstill Agreement, the
Investor Confidentiality Agreements and the Amended
and Restated Investor Confidentiality Agreements.
(iii) Each of the Buyers shall have delivered to
Sprint a certificate, dated the date of such Secondary
Closing or Greenshoe Closing, as the case may be,
signed by a duly authorized senior officer of such
Buyer, certifying that the conditions specified in
Sections 2.4(c)(i) and (ii) have been fulfilled.
(d) Except as set forth in this Section 2.4, no breach
of the representations, warranties, covenants or agreements
contained in this Agreement shall affect the obligations of
the Parties to consummate the purchase and sale of capital
stock of Sprint at any Secondary Closing or Greenshoe
Closing, provided that this sentence shall not affect any
other rights, liabilities, duties or obligations of the
Parties arising under this Agreement as a result of such
breach.
Section 2.5. Conditions Precedent to Secondary and
Greenshoe Closings After the Anticipated IPO Period.
(a) If the IPO occurs after 180 days following the CP
Exchange, the respective obligations of each Party to
consummate the transactions contemplated by this Agreement
to occur at each of the Secondary Closing and the Greenshoe
Closing are subject to the fulfillment at or prior to each
of the Secondary Closing Date and Greenshoe Closing Date,
respectively, of the following conditions which may be
waived in whole or in part by the Party being benefitted
thereby, to the extent permitted by applicable Law:
(i) No preliminary or permanent injunction or
other order, decree or ruling issued by a Governmental
Authority, nor any statute, rule, regulation or
executive order promulgated or enacted by any
Governmental Authority, shall be in effect that
enjoins the consummation of the transactions to be
effected at the Secondary Closing or the Greenshoe
Closing, as the case may be.
(ii) All other material Governmental Approvals,
if any, required in order to permit the purchase and
sale of the shares of capital stock of Sprint to be
purchased by FT and DT at the Secondary Closing or the
Greenshoe Closing, as the case may be, shall have been
received.
-14-
(b) If the IPO occurs after 180 days following the CP
Exchange, in addition to the conditions set forth in
Section 2.4(b), the obligations of the Buyers to consummate
the transactions contemplated by this Agreement to occur at
each of the Secondary Closing and the Greenshoe Closing are
subject to the fulfillment at or prior to each of the
Secondary Closing Date and Greenshoe Closing Date,
respectively, of the following conditions, which may be
waived in whole or in part by the Buyers, to the extent
permitted by applicable Law:
(i) The representations and warranties of Sprint
contained in this Agreement shall be accurate in all
material respects on the date of the Applicable
Closing with the same effect as if made on the date of
the Applicable Closing (except that any such
statements which are expressly made as of a particular
date shall have been accurate as of such particular
date and except to the extent contemplated or
permitted by this Agreement or the PCS Restructuring
Agreement). At the Applicable Closing, the Buyers
shall be provided with a certificate to such effect
from Sprint, signed by a duly authorized officer
thereof.
(ii) There shall not have occurred after the date
hereof any change in applicable Law that would cause
the Recapitalization to be deemed taxable to FT or DT
under French and German tax law.
(c) If the IPO occurs after 180 days following the CP
Exchange, in addition to the conditions set forth in
Section 2.4(c), the obligations of Sprint to consummate the
transactions contemplated by this Agreement to occur at
each of the Secondary Closing and the Greenshoe Closing are
subject to the fulfillment at or prior to each of the
Secondary Closing Date and Greenshoe Closing Date,
respectively, of the following condition, which may be
waived in whole or in part by Sprint, to the extent
permitted by applicable Law:
The representations and warranties of each of FT and
DT contained in this Agreement shall be accurate in all
material respects on the date of the Applicable Closing
with the same effect as if made on the date of the
Applicable Closing (except that any such statements which
are expressly made as of a particular date shall have been
accurate as of such particular date and except to the
extent contemplated or permitted by this Agreement or the
PCS Restructuring Agreement). At the Applicable Closing,
Sprint shall be provided with a certificate to such effect
from each of FT and DT, signed by a duly authorized officer
thereof.
-15-
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF SPRINT
----------------------------------------
Sprint represents and warrants to each of FT and DT as
follows:
Section 3.1. Organization, Qualification, Etc. Sprint is a
corporation duly organized, validly existing and in good standing
under the laws of the State of Kansas. Sprint has all requisite
corporate power and authority to: (a) enter into this Agreement,
the Amended Other Agreements and the letter agreement dated as of
the date hereof among the Parties hereto identifying certain
documents as being in form reasonably satisfactory to the Parties
(the "Letter Agreement"), (b) subject to approval by the
stockholders of Sprint and to the filing of the Proposed Charter
Amendments, issue and sell shares of Series 3 PCS Stock to the
Buyers pursuant to this Agreement and comply with its obligations
under this Agreement, each Amended Other Agreement and the Letter
Agreement, and (c) own, lease and operate its properties and
assets and to carry on in all material respects its business as
now being conducted and proposed to be conducted as shall be
described in the Proxy Statement.
Section 3.2. Capital Stock and Other Matters.
(a) Schedule 3.2 sets forth the authorized capital
stock of Sprint and the number of each class of shares
issued and outstanding as of March 31, 1998. No bonds,
debentures, notes or other indebtedness of Sprint or any of
its Subsidiaries having the right to vote (or convertible
into securities having the right to vote) on any matters on
which holders of shares of capital stock of Sprint may vote
are issued and outstanding on the date hereof. All of the
issued and outstanding shares of Sprint's capital stock are
validly issued, fully paid and nonassessable. No holder of
the outstanding shares of Sprint's capital stock is
entitled to preemptive rights with respect to any issuance
of shares of Class A Stock.
(b) Except as set forth in Schedule 3.2, no class of
capital stock of Sprint is entitled to preemptive rights.
Except as set forth in Schedule 3.2, there are no
stockholder agreements, voting trusts or other Contracts to
which Sprint is a party or by which it is bound relating to
the voting or transfer of any shares or units of any Voting
Securities of Sprint.
Section 3.3. Validity of Shares.
(a) Subject to obtaining the approval of the
stockholders of Sprint specified in Section 5.2(b) hereof
and to the filing of the Proposed Charter Amendments with
the appropriate Kansas Governmental Authorities, (i) when
the shares of Series 3 PCS Stock are issued and delivered,
in each case against payment therefor at each Applicable
Closing as provided hereby (including cash in an amount at
least equal to the aggregate par value of the shares), each
such share shall be validly issued, free of any Lien (other
than any Lien arising due to the action or inaction of any
of the Buyers), fully paid and a nonassessable share of
-16-
capital stock of Sprint and (ii) upon the filing of the
Proposed Charter Amendments, each share of Class A Common
Stock into which the Class A Common Stock held by FT is
automatically reclassified and changed, and each share of
Class A Common Stock--Series DT into which the Class A
Common Stock held by DT is automatically reclassified and
changed, will be validly issued, free of any Lien (other
than any Lien arising due to the action or inaction of any
of the Buyers), fully paid and a nonassessable share of
capital stock of Sprint.
(b) Subject to obtaining the approval of the
stockholders of Sprint specified in Section 5.2(b) hereof
and to the filing of the Proposed Charter Amendments with
the appropriate Kansas Governmental Authorities, upon the
filing of the Proposed Charter Amendments:
(i) When shares of Series 3 FON Stock, Series 3
PCS Stock, Series 1 FON Stock or Series 1 PCS Stock,
as applicable, are delivered upon sale or exchange of
interests in the Class A Common Stock or Class A
Common Stock--Series DT, each such share will be
validly issued, free of any Lien (other than any Lien
arising due to the action or inaction of any of the
Buyers), fully paid and a nonassessable share of
capital stock of Sprint;
(ii) The holders of Class A Common Stock shall,
at any time, be entitled to all of the rights and
privileges pertaining to the ownership of Series 1 FON
Stock and Series 1 PCS Stock to the extent such Class
A Common Stock represents, at such time, Shares
Issuable With Respect To The Class A Equity Interest
In the FON Group and Shares Issuable With Respect To
The Class A Equity Interest In The PCS Group (as each
such term is defined in the Proposed Charter
Amendments); and
(iii) Each share of Sprint capital stock into
which any share of Class A Stock is reclassified upon
a recapitalization in accordance with ARTICLE SIXTH,
Section 1.2(e) of the Subsequent Charter Amendment
will be validly issued, free of any Lien (other than
any Lien arising due to the action or inaction of any
of the Buyers), fully paid and a nonassessable share
of capital stock of Sprint.
Section 3.4. Corporate Authority; No Violation. The
execution, delivery and performance of this Agreement, each
Amended Other Agreement and the Letter Agreement, and the
consummation of the transactions contemplated hereby and thereby
(including, without limitation, the issuance and sale of Sprint's
capital stock) have been duly authorized by all requisite
corporate action on the part of Sprint, subject to obtaining the
approval of the stockholders of Sprint specified in Section 5.2
hereof and to the filing of the Proposed Charter Amendments with
the appropriate Kansas Governmental Authorities and assuming
that, with respect solely to those provisions of the
Stockholders' Agreement, the Amended and Restated Stockholders'
Agreement, the Articles and the Proposed Charter Amendments that
require explicitly the receipt of Continuing Director approval
for the performance of obligations or consummation of
transactions on the part of Sprint thereunder,
-17-
Continuing Director approval is obtained in the manner provided
therein. Upon the execution and delivery by Sprint of this
Agreement, each Amended Other Agreement and the Letter Agreement,
each such agreement will constitute a legal, valid and binding
agreement of Sprint, enforceable against Sprint in accordance
with its terms.
Section 3.5. No Conflict; No Default. Neither the
execution, delivery and performance by Sprint of this Agreement,
each Amended Other Agreement and the Letter Agreement, the
adoption of the Bylaws Amendment and the adoption and filing of
the Proposed Charter Amendments nor the consummation by Sprint of
the transactions contemplated hereby or thereby will: (i) subject
to the approval of the stockholders of Sprint contemplated by
Section 5.2 hereof and the filing of the Proposed Charter
Amendments with the appropriate Kansas Governmental Authorities,
violate or conflict with any provision of the Articles or Bylaws,
assuming that, with respect solely to those provisions of the
Stockholders' Agreement, the Amended and Restated Stockholders'
Agreement and the Proposed Charter Amendments that require
explicitly the receipt of Continuing Director approval for the
performance of obligations or consummation of transactions on the
part of Sprint hereunder or thereunder, Continuing Director
approval is obtained in the manner provided herein or therein;
(ii) require any Governmental Approvals or Third Party Approvals,
except (x) as set forth in Schedule 3.5 or (y) where the failure
to so obtain, make or file such Governmental Approvals or Third
Party Approvals, individually or in the aggregate, is not
reasonably likely to have a Material Adverse Effect on Sprint and
its Subsidiaries taken as a whole or adversely affect in any
material respect Sprint's ability to perform its obligations
hereunder or under the Amended Other Agreements or the Letter
Agreement; (iii) except as set forth in Schedule 3.5, result in a
default (or an event that, with notice or lapse of time or both,
would become a default) or give rise to any right of termination
by any third party, cancellation, amendment or acceleration of
any obligation or the loss of any benefit under, or result in the
creation of any Lien on any of the assets or properties of Sprint
or any of its Subsidiaries pursuant to, any Contract to which
Sprint or any of its Subsidiaries is a party or by which Sprint
or any of its Subsidiaries or any of their respective assets or
properties is bound, except for any such defaults, terminations,
cancellations, amendments, accelerations, losses, or Liens that,
individually or in the aggregate, are not reasonably likely to
have a Material Adverse Effect on Sprint and its Subsidiaries
taken as a whole or adversely affect in any material respect
Sprint's ability to perform its obligations hereunder or under
the Amended Other Agreements or the Letter Agreement; or (iv)
except as set forth in Schedule 3.5, violate or conflict with any
Law applicable to Sprint or any of its Subsidiaries, or any of
the properties, businesses, or assets of any of Sprint or any of
its Subsidiaries, except violations and conflicts that,
individually or in the aggregate, are not reasonably likely to
have a Material Adverse Effect on Sprint and its Subsidiaries
taken as a whole or adversely affect in any material respect
Sprint's ability to performs its obligations hereunder or under
the Amended Other Agreements or the Letter Agreement.
Section 3.6. Sprint Reports and Financial Statements.
(a) Sprint has previously made available to FT and DT
complete and correct copies of each: (i) annual report on
Form 10-K for Sprint; (ii) quarterly report on Form 10-Q
-18-
for Sprint; (iii) definitive proxy statement for Sprint;
(iv) current report on Form 8-K for Sprint; and (v) other
form, report, schedule and statement, in the case of each
of clauses (i), (ii), (iii), (iv) and (v) filed by Sprint
with the SEC under the Exchange Act since January 1, 1997
(collectively, the "SEC Documents"). As of their respective
dates, each of the SEC Documents complied (or will comply)
in all material respects with the requirements of the
Exchange Act to the extent applicable to such SEC Document,
and none of such SEC Documents (as of their respective
dates) contained (or will contain) an untrue statement of a
material fact or omitted (or will omit) to state 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, except as the same
was corrected or superseded in a subsequent document duly
filed with the SEC, that has been delivered to the Buyers.
Since January 1, 1997, Sprint has timely filed all reports
and registration statements and made all filings required
to be filed under the Exchange Act with the SEC under the
rules and regulations of the SEC.
(b) The audited consolidated financial statements and
unaudited consolidated interim financial statements
included in the SEC Documents (including any related notes)
fairly present the financial position of Sprint and its
consolidated Subsidiaries as of the dates thereof and the
results of operations and changes in cash flows for the
periods specified, subject, where appropriate, to normal
year-end audit adjustments, in each case in accordance with
past practice and GAAP applied on a consistent basis during
the periods involved (except as otherwise stated therein).
Since March 31, 1998, Sprint and its Subsidiaries have
incurred no liability or obligation of any nature (whether
accrued, absolute, contingent or otherwise) other than
liabilities and obligations that, individually and in the
aggregate, are not reasonably likely to have a Material
Adverse Effect on Sprint and its Subsidiaries taken as a
whole or materially and adversely affect Sprint's ability
to perform its obligations hereunder or under the Amended
Other Agreements or the Letter Agreement.
Section 3.7. Absence of Certain Changes or Events. Since
March 31, 1998 there has not been, occurred or arisen any change
in the business, financial condition or results of operations of
Sprint and its Subsidiaries taken as a whole, other than as a
result of changes in general business conditions or legal or
regulatory changes affecting the U.S. telecommunications industry
generally (including the effect on competition resulting
therefrom) or actions by competitors, having a Material Adverse
Effect on Sprint and its Subsidiaries taken as a whole or any
change that adversely affects in any material respect Sprint's
ability to perform its obligations hereunder or under the Amended
Other Agreements or the Letter Agreement.
Section 3.8. Litigation. There is no Proceeding pending or,
to the best of Sprint's Knowledge, threatened against or relating
to Sprint or any of its Subsidiaries at law or in equity that,
individually or in the aggregate, is reasonably likely to have a
Material Adverse Effect on Sprint and its Subsidiaries taken as a
whole or affect adversely in any material respect Sprint's
ability to perform its obligations hereunder or under the Amended
Other Agreements or the Letter Agreement. There is no judgment,
decree, injunction, rule or order of any Governmental Authority
outstanding against
-19-
Sprint or any of its Subsidiaries that, individually or in the
aggregate, is reasonably likely to have a Material Adverse Effect
on Sprint and its Subsidiaries taken as a whole or adversely
affect in any material respect Sprint's ability to perform its
obligations hereunder or under the Amended Other Agreements or
the Letter Agreement.
Section 3.9. Proxy Statement; Other Information.
(a) None of the information included, or incorporated
by reference, in the Proxy Statement or any amendment or
supplement thereto, will at the time of the mailing of the
definitive Proxy Statement, and at the time of the
Stockholders Meeting, contain any untrue statement of a
material fact or omit to state any material fact required
to be stated therein or necessary in order to make the
statements therein, in the light of the circumstances under
which they are made, not misleading, provided that the
foregoing shall not apply to any investment bank's fairness
opinion included therein and that no representation is made
by Sprint with respect to (i) information provided by FT,
DT or any of their Affiliates in writing specifically for
inclusion, or incorporation by reference, in the Proxy
Statement, or (ii) any representations or warranties made
by FT or DT in any agreement that is included as a schedule
or exhibit to the Proxy Statement. The Proxy Statement, at
the time of the mailing and at the time of the Stockholders
Meeting, will comply in all material respects with the
provisions of the Exchange Act.
(b) All documents that Sprint is responsible for
filing with any Governmental Authority in connection with
the transactions contemplated hereby other than those
described in Section 3.9(a) have complied and will comply
in all material respects with applicable Law. All
information supplied or to be supplied by Sprint in any
document filed with any Governmental Authority in
connection with the transactions contemplated hereby or by
the Amended Other Agreements will be, at the time of
filing, true and correct in all material respects, except
where the failure to be true and correct, individually or
in the aggregate, would not be reasonably likely to have a
Material Adverse Effect on Sprint and its Subsidiaries
taken as a whole and would not adversely affect in any
material respect the consummation of the transactions
contemplated by this Agreement or any Amended Other
Agreement or the Letter Agreement.
Section 3.10. Certain Tax Matters. To the best of Sprint's
Knowledge and belief, it is reasonable to assert that Sprint is
not a United States Real Property Holding Corporation, as that
term is defined under Section 897 of the Code and the regulations
promulgated thereunder.
Section 3.11. Amendments to the Rights Agreement. The Board
of Directors has taken, or prior to the Primary Closing will
take, all necessary action to amend the Rights Agreement to
provide that the ownership by FT, DT and their respective
Affiliates and Associates of all of the Voting Securities
permitted to be owned by them under Sections 2.1(a)(i) and 2.3 of
the Amended and Restated Standstill Agreement (but not Sections
2.1(a)(ii) or 2.2 thereof or Section 2.3 thereof to the extent
based upon an applicable Percentage Limitation (as defined in the
Amended and
-20-
Restated Standstill Agreement) as determined by Section
2.1(a)(ii) or 2.2 thereof) will not result in FT, DT or any of
their respective Affiliates or Associates (as such terms are
defined in the Rights Agreement) being deemed an Acquiring Person
(as such term is defined in the Rights Agreement) or result in
the occurrence of a Stock Acquisition Date, Distribution Date,
Section 11(a)(ii) Event or Section 13 Event (as such terms are
defined in the Rights Agreement).
Section 3.12. Other Registration Rights. Sprint has not
granted, and has not agreed to grant, any demand or incidental
registration rights to any Person other than (a) rights granted
pursuant to the Registration Rights Agreement and to be granted
pursuant to the Amended and Restated Registration Rights
Agreement, (b) rights to be granted to the Cable Partners
pursuant to the Cable Partners Registration Rights Agreement, and
(c) rights issued after the date hereof that will not adversely
affect the registration rights to be granted to the Buyers in the
Amended and Restated Registration Rights Agreement.
Section 3.13. Takeover Statutes. The Board of Directors has
taken appropriate action so that the provisions of the Business
Combination Statute will not, prior to the termination of this
Agreement, apply to FT, DT or any Person who as of the date
hereof is an Affiliate of FT or DT. The ownership by FT and DT
and any subsidiary of FT and/or DT identified in the Acquiring
Person Statement of shares of Sprint's capital stock representing
in the aggregate less than one-third of the voting power of
Sprint (assuming for purposes of the Kansas Control Share
Acquisitions Statute that none of FT, DT, any subsidiary of FT
and/or DT identified in the Acquiring Person Statement, or their
respective affiliates and associates (as each such term is
defined in the Kansas Control Share Acquisitions Statute),
acquires any Voting Securities other than as contemplated or
permitted by the Original Investment Agreement, any Initial Other
Agreement, this Agreement, any Amended Other Agreement or the
Articles, or owned, directly or indirectly, or had or exercised
the power to vote or direct the vote of, in each case alone or as
part of a group, any Voting Securities as of the date of this
Agreement or at the time of the vote contemplated by Section 5.2
other than as set forth in Sections 4.1(f) and 4.2(f)) will not
result in a loss of voting rights with respect to such shares due
to the Kansas Control Share Acquisitions Statute. No other "fair
price," "moratorium," "control share acquisition," "business
combination," "shareholder protection" or similar anti-takeover
statute or regulation enacted under the applicable Laws of any
state of the United States of America will apply to this
Agreement or any Amended Other Agreement, or the transactions
contemplated hereby or thereby (assuming that none of FT, DT and
their respective Affiliates Beneficially Own any Voting
Securities as of the date hereof other than as set forth in
Sections 4.1(f) and 4.2(f) and that none of such Persons acquires
any Voting Securities other than as contemplated or permitted by
this Agreement, any Initial Other Agreement, any Amended Other
Agreement or the Articles) except for statutes or regulations the
failure of Sprint with which to comply would not have a material
adverse effect on (a) the transactions contemplated in this
Agreement or any Amended Other Agreement, (b) the ability of the
Buyers to exercise fully their rights under this Agreement or any
Amended Other Agreement or the Articles, or (c) the intrinsic
value of an investment in Sprint's equity securities (provided
that a change in the market price of Sprint's equity securities
shall not, in and of itself, be deemed to have a material adverse
effect on the intrinsic value of an investment in Sprint's equity
securities).
-21-
Section 3.14. Vote Required; Board Recommendation. The only
votes of the stockholders of Sprint required under Kansas law and
the Articles and Bylaws to approve (a) the Proposed Charter
Amendments and (b) such other matters, if any, related thereto or
to this Agreement as Sprint may determine to submit to the
stockholders of Sprint, are (i) the affirmative vote of the
holders of a majority of the outstanding shares of the Common
Stock, the Class A Common Stock, the Preferred Stock-First
Series, the Preferred Stock-Second Series and the Preferred
Stock-Fifth Series of Sprint, voting together as a single class,
(ii) the affirmative vote of the holders of a majority of the
outstanding shares of the Common Stock and Class A Common Stock,
voting as a single class, and (iii) the approval (or the failure
to disapprove) of the Class A Common Stock, voting or taking
action as a class. The Board of Directors has determined that the
proposals contemplated by Section 5.2(b) are advisable and in the
best interests of the stockholders of Sprint.
Section 3.15. Sprint Board Action. Prior to the date
hereof, the Board of Directors of Sprint has approved (i) the
Bylaw Amendment and (ii) the Management and Allocation Policies,
each to be effective at the Primary Closing.
Section 3.16. King & Spalding Opinion. On the date hereof,
Sprint has received from King & Spalding its opinion to the
effect that (i) the Recapitalization will constitute a
recapitalization within the meaning of Section 368(a)(1)(E) of
the Code, (ii) any outstanding stock which is designated as
common stock of Sprint in Sprint's Articles of Incorporation will
constitute voting stock of Sprint for federal income tax
purposes, and (iii) except with respect to cash paid in lieu of
fractional shares, if any, the holders of such stock of Sprint
will not recognize income, gain or loss in and as a result of the
Recapitalization. In rendering such opinion, King & Spalding may
receive and rely upon representations contained in certificates
of Sprint in form and substance reasonably acceptable to King &
Spalding.
Section 3.17. PCS Restructuring Agreement. A complete and
correct copy of the PCS Restructuring Agreement has been provided
to the Buyers.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE BUYERS
--------------------------------------------
Section 4.1. Representations and Warranties of FT. FT
represents and warrants to Sprint as follows:
(a) FT is a societe anonyme validly existing under the
laws of the Republic of France, and has all requisite power
and authority to: (i) enter into this Agreement, each of
the Amended Other Agreements and the Letter Agreement, (ii)
purchase the shares of Sprint's capital stock as provided
herein, and in the Amended and Restated Stockholders'
Agreement and the Articles as amended by the Proposed
Charter Amendments, and (iii)
-22-
comply with its obligations under this Agreement, each
Amended Other Agreement and the Letter Agreement.
(b) (i) The execution, delivery and performance of
this Agreement, each Amended Other Agreement and the Letter
Agreement, and the consummation of the transactions
contemplated hereby and thereby, have been duly authorized
by all requisite action on the part of FT. Upon the
execution and delivery by FT of this Agreement, each
Amended Other Agreement and the Letter Agreement, each such
agreement will constitute a legal, valid and binding
agreement of FT, enforceable against FT in accordance with
its terms.
(ii) Neither the execution, delivery and performance
by FT of this Agreement, each Amended Other Agreement or
the Letter Agreement, nor the consummation by FT of the
transactions contemplated hereby or thereby, will: (w)
violate or conflict with any provision of the FT Law and
Decrees; (x) require any Governmental Approvals or Third
Party Approvals, except where the failure to so obtain,
make or file such Governmental Approvals or Third Party
Approvals is not reasonably likely to affect adversely in
any material respect FT's ability to perform its
obligations hereunder or under the Amended Other Agreements
or the Letter Agreement; (y) result in a default (or an
event that, with notice or lapse of time or both, would
become a default) under any Contract to which FT or any of
its Subsidiaries is a party, or by which FT or any of its
Subsidiaries or any of their respective assets or
properties is bound, except for any such defaults that,
individually or in the aggregate, are not reasonably likely
to affect adversely in any material respect FT's ability to
perform its obligations hereunder or under the Amended
Other Agreements or the Letter Agreement; or (z) violate or
conflict with Law applicable to FT or any of its
Subsidiaries, or any of the properties, businesses, or
assets of FT or any of its Subsidiaries, except violations
and conflicts that, individually or in the aggregate, are
not reasonably likely to affect adversely in any material
respect FT's ability to perform its obligations hereunder
or under the Amended Other Agreements or the Letter
Agreement.
(c) There is no Proceeding pending or, to the best of
FT's Knowledge, threatened against or relating to FT or any
of its Subsidiaries at law or in equity that, individually
or in the aggregate, is reasonably likely to affect
adversely in any material respect FT's ability to perform
its obligations hereunder or under the Amended Other
Agreements or the Letter Agreement. There is no judgment,
decree, injunction, rule or order of any Governmental
Authority outstanding against FT or any of its Subsidiaries
that, individually or in the aggregate, is reasonably
likely to adversely affect in any material respect FT's
ability to perform its obligations hereunder or under the
Amended Other Agreements or the Letter Agreement.
-23-
(d) FT is purchasing the shares of Sprint's capital
stock to be purchased by it pursuant to this Agreement and
the Amended and Restated Stockholders' Agreement for its
own account for investment, and not with a view to the
distribution of such shares or any part thereof. FT is a
party to no Contract with any Person for resale of such
shares in connection with such a distribution. FT
acknowledges that the offering of the shares pursuant to
this Agreement and the Amended and Restated Stockholders'
Agreement will not be registered under the Securities Act
or under any state securities or blue sky law or the
securities laws of any other country, on the grounds (with
respect to the Securities Act and such state securities or
blue sky laws) that the offering and sale of shares of
capital stock contemplated by this Agreement and the
Amended and Restated Stockholders' Agreement are exempt
from registration pursuant to exceptions available under
such laws, and that Sprint's reliance upon such exemptions
is predicated upon FT's representations set forth in this
Agreement and the Amended and Restated Stockholders'
Agreement. FT understands that the shares of Sprint's
capital stock purchased by it pursuant to this Agreement
and the Amended and Restated Stockholders' Agreement may
not be sold or transferred unless such shares are
subsequently registered under the Securities Act and/or
applicable state securities or blue sky laws or any
applicable securities law of any other country or an
exemption from such registration is available.
(e) All documents that FT is responsible for filing
with any Governmental Authority in connection with the
transactions contemplated hereby or by the Amended Other
Agreements have complied and will comply in all material
respects with applicable Law. All information supplied or
to be supplied by FT in any document filed with any
Governmental Authority in connection with the transactions
contemplated hereby or by the Amended Other Agreements will
be, at the time of filing, true and correct in all material
respects, except where the failure to be true and correct,
individually or in the aggregate, would not adversely
affect in any material respect the consummation of the
transactions contemplated by this Agreement or any Amended
Other Agreement or the Letter Agreement.
(f) FT is in compliance in all material respects with
Article 2 of the Standstill Agreement.
(g) Neither FT nor any Subsidiary of FT is entitled to
any immunity on the grounds of sovereignty or otherwise
(including, without limitation, pursuant to the Foreign
Sovereign Immunities Act, 28 U.S.C. P. 1602 et seq.), based
upon its status as an agency or instrumentality of
government, from any legal action, suit or proceeding or
from set off or counterclaim, from the jurisdiction of any
competent court described in Section 7.8 hereof, from
service of process, from attachment prior to judgment, from
attachment in aid of execution of a judgment, from
execution pursuant to a judgment or arbitral award, or from
any other legal process in any jurisdiction, in each case
relating to this Agreement or any Amended Other Agreement
or the Letter Agreement.
-24-
Section 4.2. Representations and Warranties of DT. DT
represents and warrants to Sprint as follows:
(a) DT is an Aktiengesellschaft duly formed and
validly existing under the laws of Germany, and has all
requisite corporate power and authority to: (i) enter into
this Agreement, each of the Amended Other Agreements and
the Letter Agreement, (ii) purchase the shares of Sprint's
capital stock as provided herein, and in the Amended and
Restated Stockholders' Agreement and the Articles as
amended by the Proposed Charter Amendments and (iii) comply
with its obligations under this Agreement, each Amended
Other Agreement and the Letter Agreement.
(b) (i) The execution, delivery and performance of
this Agreement, each Amended Other Agreement and the Letter
Agreement, and the consummation of the transactions
contemplated hereby and thereby, have been duly authorized
by all requisite corporate action on the part of DT. Upon
the execution and delivery by DT of this Agreement, each
Amended Other Agreement and the Letter Agreement, each such
agreement will constitute a legal, valid and binding
agreement of DT, enforceable against DT in accordance with
its terms.
(ii) Neither the execution, delivery and performance
by DT of this Agreement, each of the Amended Other
Agreements or the Letter Agreement, nor the consummation by
DT of the transactions contemplated hereby or thereby, will
(w) violate or conflict with any provision of the Satzung
or other governing documents of DT or any of its
Subsidiaries; (x) require any Governmental Approvals or
Third Party Approvals, except where the failure to so
obtain, make or file such Governmental Approvals or Third
Party Approvals, individually or in the aggregate, is not
reasonably likely to affect adversely in any material
respect DT's ability to perform its obligations hereunder
or under the Amended Other Agreements or the Letter
Agreement; (y) result in a default (or an event that, with
notice or lapse of time or both, would become a default)
under any Contract to which DT or any of its Subsidiaries
is a party, or by which DT or any of its Subsidiaries or
any of their respective assets or properties is bound,
except for any such defaults that, individually or in the
aggregate, are not reasonably likely to affect adversely in
any material respect DT's ability to perform its
obligations hereunder or under the Amended Other Agreements
or the Letter Agreement.
(c) There is no Proceeding pending or, to the best of
DT's Knowledge, threatened against or relating to DT or any
of its Subsidiaries at law or in equity that, individually
or in the aggregate, is reasonably likely to affect
adversely in any material respect DT's ability to perform
its obligations hereunder or under the Amended Other
Agreements or the Letter Agreement. There is no judgment,
decree, injunction, rule or order of any Governmental
Authority outstanding against DT or any of its Subsidiaries
that, individually or in the aggregate, is reasonably
likely to adversely affect in any material respect DT's
ability to
-25-
performs its obligations hereunder or under the Amended
Other Agreements or the Letter Agreement.
(d) DT is purchasing the shares of Sprint's capital
stock to be purchased by it pursuant to this Agreement and
the Amended and Restated Stockholders' Agreement for its
own account for investment, and not with a view to the
distribution of such shares or any part thereof. DT is a
party to no Contract with any person for resale of such
shares in connection with such a distribution. DT
acknowledges that the offering of the shares pursuant to
this Agreement and the Amended and Restated Stockholders'
Agreement will not be registered under the Securities Act
or under any state securities or blue sky law or the
securities laws of any other country, on the grounds (with
respect to the Securities Act and such state securities or
blue sky laws) that the offering and sale of shares of
capital stock contemplated by this Agreement and the
Amended and Restated Stockholders' Agreement are exempt
from registration pursuant to exceptions available under
such laws, and that Sprint's reliance upon such exemptions
is predicated upon DT's representations set forth in this
Agreement and the Amended and Restated Stockholders'
Agreement. DT understands that the shares of Sprint's
capital stock purchased by it pursuant to this Agreement
and the Amended and Restated Stockholders' Agreement may
not be sold or transferred unless such shares are
subsequently registered under the Securities Act and/or
applicable state securities or blue sky laws or any
applicable securities laws of any other country or an
exemption from such registration is available.
(e) All documents that DT is responsible for filing
with any Governmental Authority in connection with the
transactions contemplated hereby or by each Amended Other
Agreement have complied and will comply in all material
respects with applicable Law. All information supplied or
to be supplied by DT in any document filed with any
Governmental Authority in connection with the transactions
contemplated hereby or by the Amended Other Agreements will
be, at the time of filing, true and correct in all material
respects, except where the failure to be true and correct,
individually or in the aggregate, would not adversely
affect in any material respect the consummation of the
transactions contemplated by this Agreement or any Amended
Other Agreement or the Letter Agreement.
(f) DT is in compliance in all material respects with
Article 2 of the Standstill Agreement.
(g) Neither DT nor any Subsidiary of DT is entitled to
any immunity on the grounds of sovereignty or otherwise
(including, without limitation, pursuant to the Foreign
Sovereign Immunities Act, 28 U.S.C. P. 1602 et seq.), based
upon its status as an agency or instrumentality of
government, from any legal action, suit or proceeding or
from set off or counterclaim, from the jurisdiction of any
competent court described in Section 7.8 hereof, from
service of process, from attachment prior to judgment, from
attachment in aid of execution of a judgment, from
execution pursuant to a judgment or arbitral award, or from
-26-
any other legal process in any jurisdiction, in each case
relating to this Agreement or any Amended Other Agreement
or the Letter Agreement.
ARTICLE V
COVENANTS
---------
Section 5.1. Cooperation.
(a) Between the date hereof and the earlier of (i) the
last Applicable Closing to occur or (ii) the termination of
this Agreement, subject to the terms and conditions of this
Agreement, the Parties shall cooperate with each other and
use all commercially reasonable efforts to obtain all
necessary consents and approvals for the consummation of
the transactions contemplated hereby and otherwise to
satisfy the conditions to closing set forth in Article II
hereof. Without limiting the generality of the foregoing,
(A) each of FT and DT agrees to vote (or cause to be voted)
the shares of capital stock of Sprint it owns (directly or
indirectly) in favor of the Initial Charter Amendment, the
Subsequent Charter Amendment, this Agreement, the Amended
Other Agreements, the PCS Restructuring Agreement and the
transactions contemplated hereby and thereby and the other
matters related thereto presented for a vote at the
Stockholders Meeting (including any class vote of the Class
A Holders required thereat or in connection therewith), and
agrees not to exercise any disapproval rights which it may
have under the Articles or otherwise with respect to any
such matters, and (B) each Party shall use its commercially
reasonable efforts to obtain all consents and
authorizations of third parties and Governmental
Authorities and to make all filings with and give all
notices to third parties and Governmental Authorities which
may be necessary or required in order to effect the
transactions contemplated hereby.
(b) Each of the Parties shall use its reasonable
efforts to resolve such objections, if any, as any
Governmental Authority may assert with respect to this
Agreement and the Amended Other Agreements and the
transactions contemplated hereby and thereby under
applicable Laws, including requesting reconsideration
(which may be initiated by the party affected thereby or
requested by any other Party) of any adverse ruling of any
Governmental Authority and taking administrative appeals,
if available and reasonably likely to result in a reversal
of such adverse ruling. If any Proceeding is instituted by
any Person challenging this Agreement, the Amended Other
Agreements or the transactions contemplated hereby or
thereby, the Parties shall promptly consult with each other
to determine the most appropriate response to such
Proceeding and shall cooperate in all reasonable respects
with any Party subject to any such Proceeding, provided
that the decision whether to initiate, and the control of,
any Proceeding involving any Party shall remain within the
sole discretion of such Party.
(c) Notwithstanding the foregoing, in connection with
any filing or submission required or action to be taken by
Sprint, FT or DT to consummate the transactions
-27-
contemplated hereby, (i) neither Sprint nor any Affiliates
of Sprint shall be required to become subject to any
requirement or condition that it divest or "hold separate"
any assets or businesses or any similar transaction or
restriction, and (ii) neither Sprint nor any Affiliates of
Sprint shall be required to divest or hold separate or
otherwise take (or refrain from taking) or commit to take
(or refrain from taking) any action that limits its freedom
of action with respect to, or its ability to retain, any of
the businesses, product lines or assets of Sprint or any of
its Subsidiaries.
(d) Each Party shall (i) execute and deliver such
additional instruments and other documents as may be
reasonably requested by the other Parties hereto in
connection with the consummation of the transactions
contemplated hereby, and (ii) use its reasonable efforts to
take, or cause to be taken, all actions and to do, or cause
to be done, all things necessary under applicable Law to
consummate the transactions contemplated hereby and by the
Amended Other Agreements and to satisfy the applicable
conditions to closing hereunder.
(e) FT shall comply, to the extent permitted by
applicable Law of France, with final and nonappealable
discovery orders rendered by a court of competent
jurisdiction as provided in Section 7.8 hereof or in any
corresponding section of any Amended Other Agreement, and
shall take such reasonable action as appropriate in order
to permit FT to so comply with such orders.
(f) DT shall comply, to the extent permitted by
applicable Law of Germany, with final and nonappealable
discovery orders rendered by a court of competent
jurisdiction as provided in Section 7.8 hereof or in any
corresponding section of any Amended Other Agreement, and
shall take such reasonable action as appropriate in order
to permit DT to so comply with such orders.
(g) Sprint shall, at the request of FT and DT, use its
commercially reasonable efforts to obtain, as soon as is
practicable, any United States regulatory approvals or
other regulatory relief as FT and DT reasonably deem
appropriate in order for FT and DT to exercise and benefit
from their rights under this Agreement, the Amended Other
Agreements and the Articles.
(h) In addition to any obligations under the
Standstill Agreement or the Amended and Restated Standstill
Agreement, the Parties shall use reasonable efforts to
consult in good faith with each other with a view to
agreeing upon any press release or public announcement
relating to the transactions contemplated hereby or by the
Amended Other Agreements prior to the consummation thereof.
-28-
Section 5.Certain Actions by Sprint.
(a) As soon as is reasonably practicable after the
execution of this Agreement, Sprint shall prepare and file
with the SEC (i) the Proxy Statement to be mailed to Sprint
stockholders in connection with the Stockholders Meeting to
be held for the purpose of approving the Initial Charter
Amendment, the Subsequent Charter Amendment and amendments
to certain of Sprint's equity-based incentive plans in
connection with the creation of the PCS Stock, among other
things, and (ii) the Registration Statement containing the
IPO Prospectus covering the shares of Series 1 PCS Stock to
be sold in the IPO. Sprint shall use its commercially
reasonable efforts to cause the Proxy Statement to be
approved for mailing and the Registration Statement to
become effective under the Securities Act, each as promptly
as practicable after such filing, and shall take all
commercially reasonable actions required to be taken under
any applicable state blue sky or securities laws in
connection with the IPO and the Recapitalization.
(b) Sprint shall cause the Stockholders Meeting to be
held as soon as practicable after the date hereof. Sprint's
Board of Directors shall recommend that its stockholders
approve the Initial Charter Amendment, the Subsequent
Charter Amendment and the other matters related thereto
presented for a vote in the Proxy Statement (including
matters, if any, referred to in clause (b) of Section
3.14), and Sprint shall use commercially reasonable efforts
to obtain such stockholder approval. Sprint shall not be
deemed to have breached any obligation under this Agreement
by reason of the disclosure of information in the Proxy
Statement or any public announcement or other communication
with Sprint's stockholders if such disclosure is required
by Law, so long as the Board of Directors of Sprint shall
not have withdrawn, limited, qualified or conditioned the
recommendation referred to above. Sprint's conclusion that
any such disclosure is required by Law will be final and
binding on all the parties hereto if Sprint has received a
written opinion of counsel that such disclosure or
communication is required by Law. "Commercially reasonable"
efforts shall not be deemed to require any action that
would prevent Sprint's compliance with Section 3(a)(9) of
the Securities Act in connection with the Recapitalization.
Each of FT and DT shall provide such information regarding
itself and its Affiliates as may reasonably be requested by
Sprint for inclusion in the Proxy Statement. The
information provided by FT and DT in writing for inclusion
in the Proxy Statement will not contain any material
misstatement of fact or omit to state any material fact
necessary to make the statements, in the light of the
circumstances under which they are made, not misleading.
All statements included in the Proxy Statement relating to
FT or DT shall be subject to the approval of FT and DT,
such approval not to be unreasonably withheld. If, at any
time after the mailing of the definitive Proxy Statement
and prior to the Stockholders Meeting, any event should
occur that results in the information supplied by FT, DT or
their respective Affiliates in writing for inclusion in the
Proxy Statement containing an untrue statement of a
material fact or omitting to state any material fact
required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under
which they are made, not misleading, FT and DT shall
promptly notify Sprint of the occurrence of such event.
-29-
(c) Sprint currently intends to close the IPO as soon
as practicable following the Trigger Date, assuming that
the other conditions to the closing (other than conditions
relating solely to the obligations of FT and DT to purchase
capital stock hereunder) have been satisfied or are capable
of being satisfied on or prior to the Primary Closing Date;
provided that the determination to proceed with the IPO at
any time shall remain in Sprint's sole discretion. If the
IPO occurs prior to the Recapitalization, the Primary
Closing shall occur simultaneously with the closing of the
IPO. If Sprint causes the IPO to be completed
simultaneously with the Primary Closing, Sprint shall
complete the Recapitalization by filing the Subsequent
Charter Amendment with the Kansas Secretary of State within
120 days following the Primary Closing and, unless the
Transfer Restrictions (as defined in the Amended and
Restated Stockholders Agreement) have been terminated
pursuant to Section 2.6(a) of the Amended and Restated
Stockholders Agreement, each of FT and DT will, and will
cause its controlled Affiliates to, for a period of one
hundred eighty (180) days following the Primary Closing
Date, refrain from engaging in any public sale or
distribution of any PCS Stock or securities convertible
into, or exchangeable or exercisable for, or the value of
which relates to or is based upon, PCS Stock.
(d) Subject to Section 5.2(e), if the IPO is not
completed on or prior to the 30th day following the Trigger
Date, then Sprint shall on the earlier of (i) the date
which is 10 days following such date subsequent to the
Trigger Date that Sprint reasonably determines that the IPO
is not capable of being completed on or prior to the 30th
day following the Trigger Date or (ii) the 40th day
following the Trigger Date, effect the Recapitalization by
filing the Initial Charter Amendment and the Subsequent
Charter Amendment with the Kansas Secretary of State,
assuming that the other conditions to closing have been
satisfied or are capable of being satisfied at the Primary
Closing. If Sprint causes the Recapitalization to be
completed as provided in this Section 5.2(d), the Primary
Closing hereunder shall occur simultaneously with the
completion of the Recapitalization. In such event, Sprint
currently intends to complete the IPO within 120 days after
the Primary Closing Date. If Sprint completes the
Recapitalization simultaneously with the Primary Closing
and the IPO is completed within such 120-day period, unless
the Transfer Restrictions (as defined in the Amended and
Restated Stockholders Agreement) have been terminated
pursuant to Section 2.6(a) of the Amended and Restated
Stockholders Agreement, each of FT and DT will, and will
cause its controlled Affiliates to, for a period commencing
at the time of the Primary Closing and ending 90 days
following the closing of the IPO, refrain from engaging in
any public sale or distribution of any PCS Stock or
securities convertible into, or exchangeable or exercisable
for, or the value of which relates to or is based upon, PCS
Stock.
(e) If the Trigger Date occurs after August 1, 1998,
and before September 1, 1998, the Trigger Date will be
deemed to occur on the earlier of (i) September 1, 1998 or
(ii) such date after August 1, 1998, that Sprint reasonably
determines that the IPO is not capable of being completed
on or prior to October 1, 1998.
-30-
Section 5.3. IPO Matters. The IPO will be conducted
substantially in accordance with the terms of the PCS
Restructuring Agreement.
Section 5.4. Tax Matters. Each Party shall use all
reasonable efforts to cause the Recapitalization to constitute a
tax-free "reorganization" under Section 368(a) of the Code. Each
Party agrees that it will not take any action, and will not
permit any of its Subsidiaries or Affiliates to take any action,
that such party knows would cause the Recapitalization to fail to
qualify as a tax-free reorganization under Section 368(a) of the
Code. Each Party agrees to report the Recapitalization on all tax
returns and other filings as a reorganization under Section
368(a) of the Code. Absent a change in applicable Law, or a
change in facts beyond Sprint's reasonable control, Sprint agrees
that (i) it will not treat the closing of the transactions
contemplated by this Agreement and the Amended Other Agreements,
including with respect to the equity purchase rights of FT and DT
described herein and therein, as giving rise to any withholding
tax obligation (except in respect of any cash payments) and (ii)
it will not change the withholding rate otherwise applicable to
distributions as the result of the class votes provided to the
holders of the PCS Stock. For purposes of the preceding sentence,
change in applicable Law also includes any Revenue Ruling, and
(as of the proposed effective date thereof) any proposed
regulations or official notice of intent to propose regulations
issued by the Internal Revenue Service.
Section 5.5. Brokers or Finders.
(a) Other than Xxxxxxx Xxxxx Xxxxxx and SBC Warburg
Dillon Read, no Person is or will be entitled to any
broker's or finder's fee or any other commission or similar
fee as a result of any action by Sprint or any of its
Affiliates in connection with the transactions contemplated
by this Agreement and the Amended Other Agreements. Sprint
agrees to indemnify and hold harmless each of FT and DT
from and against any and all claims, liabilities and
obligations (including attorneys' fees (but not including
the portion of any such fees determined pursuant to the
German Fee Regulations) and disbursements of counsel) with
respect to any such fees asserted by any Person as a result
of any action by Sprint or any of its Affiliates in
connection with the transactions contemplated by this
Agreement and the Amended Other Agreements.
(b) Other than Credit Suisse First Boston, no Person
is or will be entitled to any broker's or finder's fee or
any other commission or similar fee as a result of any
action by FT or any of its Affiliates in connection with
the transactions contemplated by this Agreement and the
Amended Other Agreements. FT agrees to indemnify and hold
Sprint harmless from and against any and all claims,
liabilities and obligations (including attorneys' fees and
disbursements of counsel) with respect to any such fees
asserted by any Person as a result of any actions by FT or
its Affiliates in connection with the transactions
contemplated by this Agreement and the Amended Other
Agreements.
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(c) Other than Credit Suisse First Boston, no Person
is or will be entitled to any broker's or finder's fee or
any other commission or similar fee as a result of any
action by DT or any of its Affiliates in connection with
the transactions contemplated by this Agreement and the
Amended Other Agreements. DT agrees to indemnify and hold
Sprint harmless from and against any and all claims,
liabilities and obligations (including attorneys' fees and
disbursements of counsel) with respect to any such fees
asserted by any Person as a result of any actions by DT or
its Affiliates in connection with the transactions
contemplated by this Agreement and the Amended Other
Agreements.
Section 5.6. No Action Relating to Takeover Statutes;
Applicability of Future Statutes and Regulations. Sprint shall
(a) take no action, by resolution of its Board of Directors or
otherwise, to cause the Business Combination Statute or the
provisions of the Kansas Control Share Acquisitions Statute to
apply to FT, DT or their respective Affiliates by virtue of the
transactions contemplated by this Agreement, any Amended Other
Agreement or the Articles, and (b) use reasonable efforts to
avoid (to the extent possible) the application of any "fair
price," "moratorium," "control share acquisition," "business
combination," "shareholder protection" or similar anti-takeover
statute or regulation promulgated under Kansas law after the date
hereof to FT, DT or their respective Affiliates by virtue of the
transactions contemplated by this Agreement, any Amended Other
Agreement or the Articles.
Section 5.7. Management and Allocation Policies. Sprint
will not make any change in or amendment to the Management and
Allocation Policies or the Bylaw Amendment (or waive or otherwise
disregard any provision thereof) prior to the Recapitalization
without the consent of each of FT and DT.
Section 5.8. Sprint Action. Except to the extent that each
of the Buyers otherwise consents in writing, or as otherwise
contemplated by the PCS Restructuring Agreement, this Agreement
or the Amended Other Agreements, until the Primary Closing,
Sprint shall not amend or propose to amend the Articles or Bylaws
in any manner that would adversely affect the consummation of the
transactions contemplated by, or otherwise adversely affect the
rights of the Buyers under, this Agreement, each Amended Other
Agreement, the Articles as proposed to be amended by the Proposed
Charter Amendments, and the Bylaws as proposed to be amended by
the Bylaws Amendment.
Section 5.9. Standstill Agreement. The discussions solely
among FT, DT and Sprint (and their respective legal counsel and
investment bankers) in connection with the negotiation, execution
and delivery of this Agreement and the Amended Other Agreements
and the discussions solely among FT, DT and Sprint (and their
respective legal counsel and investment bankers) in connection
with the consummation of the transactions contemplated thereby
shall not constitute a violation of the Standstill Agreement or
the Amended and Restated Standstill Agreement. In addition, the
discussions solely among FT, DT, Sprint and the Cable Partners
(and their respective legal counsel and investment bankers) prior
to the date hereof in connection with the negotiation, execution
and
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delivery of the Purchase Rights Agreement shall not constitute a
violation of the Standstill Agreement or the Amended and Restated
Standstill Agreement.
ARTICLE VI
TERMINATION; ABANDONMENT
------------------------
Section 6.1. Events of Termination. This Agreement may be
terminated and the transactions contemplated hereby abandoned at
any time prior to the Primary Closing:
(a) by mutual written consent of the Parties;
(b) by any Party, by notice to the other Parties, if
the actions to be taken by the Parties at the Primary
Closing under clauses (a), (b) and (h) through (m) only of
Section 1.1 hereof shall be prohibited by any final,
nonappealable order, decree or injunction of a Governmental
Authority;
(c) by any Party that is not in material breach of any
material covenant contained in this Agreement, by notice to
the other Parties if the Primary Closing has not occurred
on or before December 31, 1998;
(d) by any Party that is not in material breach of any
material covenant contained in this Agreement, by notice to
the other Parties following the time that any condition to
the Primary Closing set forth in Article II (other than any
conditions set forth in Sections 2.1(b) and 2.3(b)) has
become incapable of being satisfied on or prior to December
31, 1998;
(e) by any Party that is not in material breach of any
material covenant contained in this Agreement, by notice to
the other Parties following a material breach of any
material covenant contained in this Agreement by any other
Party if such breach remains uncured in any material
respect for 30 days following the giving of notice of the
breach of such material covenant from the Party seeking to
terminate this Agreement to each other Party; provided,
that the Party seeking to terminate this Agreement gives
written notice of such termination to each other Party
within 30 days following the end of such 30-day cure
period; or
(f) by FT or DT, if the Board of Directors shall have
withdrawn its recommendation of the proposals contemplated
by Section 5.2(b) hereof or shall have qualified its
recommendation in a manner materially adverse to FT and DT,
provided that for purposes of this clause (f) if the Board
of Directors continues its recommendation and approval of
such proposals, but reflects in its recommendation
additional information, the inclusion of such additional
information, in and of itself, shall not be deemed to be a
qualification that is materially adverse to FT and DT or
otherwise provide FT and DT with a termination right under
this clause (f).
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Section 6.2. Effect of Termination.
(a) If this Agreement is terminated in accordance with
Section 6.1, then this Agreement shall become null and void
and have no further effect, without any liability of any
Party to any other Party, except that the obligations of
the Parties pursuant to Section 6.3 and Article VII and
under any provision of this Agreement that expressly
provides for certain actions to occur simultaneously with
or following the termination of this Agreement shall
survive the termination of this Agreement indefinitely;
provided, that no such termination shall release or relieve
any Party hereto from liability for any willful material
breach of any material provision of this Agreement
occurring prior to such termination.
(b) If this Agreement is terminated in accordance with
Section 6.1, then the Initial Other Agreements shall
continue in full force and effect until terminated in
accordance with their respective terms, without any
amendment to the rights and obligations of the parties
thereto.
Section 6.3. Reimbursement of Expenses. If this Agreement
is terminated pursuant to Section 6.1(f), in addition to any
other remedies the Buyers may have hereunder, at law, in equity
or otherwise, Sprint shall promptly reimburse each of FT and DT
for their actual reasonable out-of-pocket expenses (including
attorneys' fees, but notwithstanding the foregoing, not including
the portion of any fees determined pursuant to the German Fee
Regulations) incurred by it relating to the transactions
contemplated by this Agreement and the Amended Other Agreements
(as set forth on a certificate or certificates executed by an
officer of each of FT and DT describing such expenses in
reasonable detail) up to a maximum aggregate amount of $5 million
for FT and DT collectively, to be allocated between FT and DT as
FT and DT shall so determine.
Section 6.4. Abandonment of Purchase and Sale of Capital
Stock at Primary Closing. The obligations of the parties to
consummate the purchase by FT and DT of the capital stock of
Sprint contemplated hereby to occur at the Primary Closing may be
abandoned at any time prior to the Primary Closing:
(a) by any Party, by notice to the other Parties, if
the purchase and sale of the capital stock of Sprint
contemplated to occur at the Primary Closing shall be
prohibited by any final, nonappealable order, decree or
injunction of a Governmental Authority; or
(b) if a Change of Control shall have occurred.
Notwithstanding any abandonment pursuant to this Section 6.4 of
the purchase and sale of the capital stock of Sprint to be
effected at the Primary Closing, this Agreement shall not be
terminated and such abandonment shall have no effect whatsoever
on (i) the Buyers' obligations under Article V to vote (or cause
to be voted) the shares of capital stock of Sprint they own
(directly or indirectly) in favor of the Initial Charter
Amendment, the Subsequent Charter Amendment, this Agreement, the
Amended Other Agreements, the PCS Restructuring Agreement and the
transactions contemplated
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hereby and thereby and any other matters related thereto
presented for a vote at the Stockholders Meeting (including any
class vote of the Class A Holders required thereat or in
connection therewith), and their agreement not to exercise any
disapproval rights which they may have under the Articles or
otherwise with respect to any such matters, or (ii) any other
actions to be taken by the Parties at the Primary Closing,
including the Parties' obligations to proceed with all of the
transactions and deliveries contemplated to be undertaken at the
Primary Closing (other than the purchase and sale by the Buyers
of the capital stock of Sprint), and such transactions and
deliveries in fact shall proceed if all of the other conditions
to the Primary Closing have been satisfied or waived.
Section 6.5. Abandonment of Secondary Closing and Greenshoe
Closing. The obligations of the parties to consummate the
purchase by FT and DT of the capital stock of Sprint contemplated
hereby to occur at the Secondary Closing and/or the Greenshoe
Closing may be abandoned at any time after the Primary Closing
and prior to such Secondary Closing or Greenshoe Closing, as the
case may be:
(a) by mutual written consent of the Parties;
(b) by any Party, by notice to the other Parties, if
the Secondary Closing or Greenshoe Closing, as the case may
be, shall be prohibited by any final, nonappealable order,
decree or injunction of a Governmental Authority;
(c) by any Party that is not in material breach of any
material covenant contained in this Agreement, by notice to
the other Parties if the Secondary Closing has not occurred
on or before June 30, 1999;
(d) by any Party that is not in material breach of any
material covenant contained in this Agreement, by notice to
the other Parties following the time that any condition to
closing set forth in Article II and applicable to the
purchase by FT and DT of capital stock pursuant to this
Agreement at the Secondary Closing or the Greenshoe Closing
has become incapable of being satisfied on or prior to June
30, 1999;
(e) by any Party that is not in material breach of any
material covenant contained in this Agreement, by notice to
the other Parties following a material breach of any
material covenant contained in this Agreement by any other
Party if such breach remains uncured in any material
respect for 30 days following the giving of notice of the
breach of such material covenant from the Party seeking to
terminate this Agreement to each other Party; provided,
that the Party seeking to abandon the Secondary Closing or
the Greenshoe Closing gives written notice of such
termination to each other Party within 30 days following
the end of such 30-day cure period; or
(f) if a Change of Control shall have occurred.
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Notwithstanding any abandonment of the Secondary Closing or the
Greenshoe Closing pursuant to this Section 6.5, this Agreement
shall not be terminated and such abandonment shall have no effect
whatsoever on the actions taken or to be taken by the Parties at
the Primary Closing, including the execution and delivery by the
Parties of the Amended Other Agreements.
ARTICLE VII
MISCELLANEOUS
-------------
Section 7.1. Survival of Representations and Warranties.
(a) The representations and warranties made by (i)
Sprint in Sections 3.1 through 3.5, the first two sentences
of Section 3.6(a) and Section 3.7 (but, in the case of
Section 3.7, only to the extent that a change described in
such Section relates to a Material Adverse Effect on Sprint
and its Subsidiaries taken as a whole that existed on the
Primary Closing Date, but arose after the later of (x) the
date of the end of the quarter covered by the last
Quarterly Report on Form 10-Q of Sprint filed prior to the
Primary Closing Date and (y) the date of the end of the
year covered by the last Annual Report on Form 10-K of
Sprint filed prior to the Primary Closing Date) of this
Agreement, and (ii) the Buyers in Sections 4.1 and 4.2 of
this Agreement (the "Surviving Representations") will
survive, solely with respect to any damages relating to
each particular investment to be made at an Applicable
Closing, until the earlier to occur of (x) 15 months after
the date of the Applicable Closing and (y) 90 days after
the publication of the results of the first full audit of
the consolidated financial statements of Sprint and its
Subsidiaries by Sprint's independent auditors following the
Applicable Closing, such financial statements to include a
balance sheet and statements of income and cash flows as of
a date following the Applicable Closing and to be prepared
in accordance with GAAP applied on a consistent basis with
the financial statements included in the SEC Documents.
Sprint shall have the right to cause its independent
auditors to conduct such an audit at any time after the
Applicable Closing. No action may be brought with respect
to a breach of any Surviving Representation after such time
unless, prior to such time, the Party seeking to bring such
an action has notified the other Parties of such claim,
specifying in reasonable detail the nature of the loss
suffered. The representations and warranties provided in
Sections 3.10, 4.1(g) and 4.2(g) shall survive without
limitation as to time. None of the other representations
and warranties made by any party in this Agreement or any
Amended Other Agreement or in any certificate or document
delivered pursuant hereto or thereto prior to or on the
Applicable Closing shall survive the Applicable Closing.
None of the representations and warranties made by any
Party in this Agreement or any Amended Other Agreement or
in any certificate or document delivered pursuant hereto or
thereto at the Secondary Closing or Greenshoe Closing shall
survive such Secondary Closing or Greenshoe Closing, as the
case may be, provided that if any certificate or document
delivered pursuant hereto, or any portion thereof, pertains
to a Surviving Representation,
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such certificate or document, or such portion thereof,
shall survive until the Surviving Representation to which
it pertains shall no longer survive as provided herein.
(b) The Buyers shall be entitled to recovery with
respect to breaches of the Surviving Representations and to
the representation and warranty provided in Section 3.10
made by Sprint pursuant to this Agreement (and in any
certificate pertaining to any such representation) only if
the aggregate amount of loss, liability or damage
(including reasonable attorneys' fees (but not including
the portion of any fees determined pursuant to the German
Fee Regulations) and other costs and expenses)
(collectively, "Damages") incurred or sustained by the
Buyers arising from or relating to such breaches, in the
aggregate, exceeds $30 million. Sprint shall be entitled to
recovery with respect to breach of the Surviving
Representations made by the Buyers pursuant to this
Agreement (and in any certificate pertaining to any such
representation) only if the aggregate amount of Damages
sustained by Sprint arising from or relating to such
breaches exceeds $30 million. Sprint shall not incur any
liability under the representation and warranty provided in
Section 3.10 or under any certificate pertaining to such
representation (even if Sprint turns out in fact to be a
U.S. real property holding corporation), provided that such
representation and warranty is made to the best of Sprint's
Knowledge and belief.
(c) Notwithstanding anything in this Section 7.1 to
the contrary, except solely with respect to the
representations and warranties in Section 3.3 relating to
the effect of the filing of the Proposed Charter Amendments
with respect to the Class A Common Stock, the Buyers shall
be entitled to Damages under this Section 7.1 only to the
extent such Damages directly relate to the investment in
Sprint being made by the Buyers pursuant to this Agreement,
and without limiting the generality of the foregoing, the
Buyers shall have no claim for Damages under this Agreement
with respect to any actual or alleged diminution in value
of, or other loss, liability or damage associated with, the
Buyers' existing investment in Sprint or any additional
purchases of capital stock of Sprint made by the Buyers
other than pursuant to this Agreement.
Section 7.2. Assignment. No Party will assign this
Agreement or any rights, interests or obligations hereunder, or
delegate performance of any of its obligations hereunder, without
the prior written consent of each other Party.
Section 7.3. Entire Agreement. This Agreement, including
the Disclosure Schedules, the Exhibits attached hereto, and the
Amended Other Agreements embody the entire agreement and
understanding of the Parties in respect of the subject matter
contained herein, provided that this provision shall not abrogate
(a) any other written agreement between the Parties executed
simultaneously with this Agreement, (b) the Original Investment
Agreement, or (c) the understanding set forth in Item 1 of
Schedule 2 to that certain memorandum dated June 22, 1995 among
Sprint, FT and DT. This Agreement supersedes all prior agreements
and understandings between the Parties with respect to such
subject matter, except as so provided in the preceding sentence.
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Section 7.4. Expenses. Except as set forth in the next
sentence, each Party and each of its Affiliates will bear its own
expenses (including the fees and expenses of any attorneys,
accountants, investment bankers, brokers, or other Persons
engaged by it) incurred in connection with the preparation,
negotiation, authorization, execution and delivery hereof and
each of the Amended Other Agreements to which it or any of its
Affiliates is a party, and the transactions contemplated hereby
and thereby. Each of the Parties agrees that a Party making a
request for this Agreement, the Letter Agreement, an Amended
Other Agreement or any other document related to this Agreement
and the Amended Other Agreements to be translated in the French
language shall be responsible for the expenses associated with
the preparation of such translations and that the non-requesting
Parties shall be responsible for the expenses associated with the
review of such translations by the non- requesting Parties and
their advisors.
Section 7.5. Waiver, Amendment, Etc. This Agreement may not
be amended or supplemented, and no waivers of or consents to
departures from the provisions hereof shall be effective, unless
set forth in a writing signed by, and delivered to, all the
Parties. No failure or delay of any Party in exercising any power
or right under this Agreement will operate as a waiver thereof,
nor will any single or partial exercise of any right or power, or
any abandonment or discontinuance of steps to enforce such right
or power, preclude any other or further exercise thereof or the
exercise of any other right or power.
Section 7.6. Binding Agreement; No Third Party
Beneficiaries. This Agreement will be binding upon and inure to
the benefit of the Parties and their successors and permitted
assigns. Nothing expressed or implied herein is intended or will
be construed to confer upon or to give to any third party any
rights or remedies by virtue hereof.
Section 7.7. Notices. All notices and other communications
required or permitted by this Agreement shall be made in writing
in the English language and any such notice or communication
shall be deemed delivered when delivered in person, transmitted
by telex or telecopier, or seven days after it has been sent by
air mail, as follows:
FT: 0 xxxxx x'Xxxxxxx
00000 Xxxxx Cedex 15
France
Attn: Group Executive Vice President
Tel: (00-0) 00-00-00-00
Fax: (00-0) 00-00-00-00
with a copy to: 0 xxxxx x'Xxxxxxx
00000 Xxxxx Cedex 15
France
Attn: General Counsel
Tel: (00-0) 00-00-00-00
Fax: (00-0) 00-00-00-00
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with a copy to: Shearman & Sterling
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
X.X.X.
Attn: Xxxxxx X. Xxxx, Xx., Esq.
Tel: (000) 000-0000
Fax: (000) 000-0000
DT: Xxxxxxxxx-Xxxxx-Xxxxx 000
X-00000 Xxxx
Xxxxxxx
Tel: 00-000-000-0000
Fax: 00-000-000-0000
Attn: Chief Executive Officer
with a copy to: Cleary, Gottlieb, Xxxxx & Xxxxxxxx
Xxx Xxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
X.X.X.
Attn: Xxxxxx X. Xxxxx, Esq.
Tel: (000) 000-0000
Fax: (000) 000-0000
Sprint: 0000 Xxxxxxx Xxxxxxx
Xxxxxxx, Xxxx Wing
Westwood, Kansas 66205
U.S.A.
Attn: General Counsel
Tel: (000) 000-0000
Fax: (000) 000-0000
with a copy to: King & Spalding
000 Xxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx 00000
X.X.X.
Attn: Xxxxx X. Xxxxxxxxx, Esq.
Tel: (000) 000-0000
Fax: (000) 000-0000
The Parties shall promptly notify each other in the manner
provided in this Section 7.7 of any change in their respective
addresses. A notice of change of address shall not be deemed to
have been given until received by the addressee. Communications
by telex or telecopier also shall be sent concurrently by mail,
but shall in any event be effective as stated above.
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Section 7.8. Governing Law; Dispute Resolution; Equitable
Relief.
(a) THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK
(REGARDLESS OF THE LAWS THAT MIGHT OTHERWISE GOVERN UNDER
APPLICABLE PRINCIPLES OF CONFLICTS OF LAW).
(b) EACH PARTY IRREVOCABLY CONSENTS AND AGREES THAT
ANY LEGAL ACTION, SUIT OR PROCEEDING AGAINST IT WITH
RESPECT TO ITS OBLIGATIONS OR LIABILITIES UNDER OR ARISING
OUT OF OR IN CONNECTION WITH THIS AGREEMENT SHALL BE
BROUGHT BY SUCH PARTY ONLY IN THE UNITED STATES DISTRICT
COURT FOR THE SOUTHERN DISTRICT OF NEW YORK OR, IN THE
EVENT (BUT ONLY IN THE EVENT) SUCH COURT DOES NOT HAVE
SUBJECT MATTER JURISDICTION OVER SUCH ACTION, SUIT OR
PROCEEDING, IN XXX XXXXXX XX XXX XXXXX XX XXX XXXX SITTING
IN THE CITY OF NEW YORK, AND EACH PARTY HEREBY IRREVOCABLY
ACCEPTS AND SUBMITS TO THE JURISDICTION OF EACH OF THE
AFORESAID COURTS IN PERSONAM, WITH RESPECT TO ANY SUCH
ACTION, SUIT OR PROCEEDING (INCLUDING, WITHOUT LIMITATION,
CLAIMS FOR INTERIM RELIEF, COUNTERCLAIMS, ACTIONS WITH
MULTIPLE DEFENDANTS AND ACTIONS IN WHICH SUCH PARTY IS
IMPLED). EACH PARTY IRREVOCABLY AND UNCONDITIONALLY WAIVES
ANY RIGHT THAT IT MAY HAVE TO A JURY TRIAL IN ANY LEGAL
ACTION, SUIT OR PROCEEDING WITH RESPECT TO, OR ARISING OUT
OF OR IN CONNECTION WITH THIS AGREEMENT.
(c) EACH OF FT AND DT HEREBY IRREVOCABLY DESIGNATES CT
CORPORATION SYSTEM (IN SUCH CAPACITY, THE "PROCESS AGENT"),
WITH XX XXXXXX XX 0000 XXXXXXXX, XXX XXXX, XXX XXXX, 00000
AS ITS DESIGNEE, APPOINTEE AND AGENT TO RECEIVE, FOR AND ON
ITS BEHALF SERVICE OF PROCESS IN SUCH JURISDICTION IN ANY
LEGAL ACTION OR PROCEEDINGS WITH RESPECT TO THIS AGREEMENT
AND THE AMENDED OTHER AGREEMENTS, AND SUCH SERVICE SHALL BE
DEEMED COMPLETE UPON DELIVERY THEREOF TO THE PROCESS AGENT,
PROVIDED THAT IN THE CASE OF ANY SUCH SERVICE UPON THE
PROCESS AGENT, THE PARTY EFFECTING SUCH SERVICE SHALL ALSO
DELIVER A COPY THEREOF TO FT AND DT IN THE MANNER PROVIDED
IN SECTION 7.7. FT AND DT SHALL TAKE ALL SUCH ACTION AS MAY
BE NECESSARY TO CONTINUE SAID APPOINTMENT IN FULL FORCE AND
EFFECT OR TO APPOINT ANOTHER AGENT SO THAT FT AND DT WILL
AT ALL TIMES HAVE AN AGENT FOR SERVICE OF PROCESS FOR THE
ABOVE PURPOSES IN NEW YORK, NEW YORK. IN THE EVENT OF THE
TRANSFER OF ALL OR SUBSTANTIALLY ALL OF THE ASSETS AND
BUSINESS OF THE PROCESS AGENT TO ANY OTHER CORPORATION BY
CONSOLIDATION, MERGER, SALE OF ASSETS OR OTHERWISE, SUCH
OTHER
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CORPORATION SHALL BE SUBSTITUTED HEREUNDER FOR THE PROCESS
AGENT WITH THE SAME EFFECT AS IF NAMED HEREIN IN PLACE OF
CT CORPORATION SYSTEM. EACH OF FT AND DT FURTHER
IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS OUT OF ANY
OF THE AFOREMENTIONED COURTS IN ANY SUCH ACTION OR
PROCEEDING BY THE MAILING OF COPIES THEREOF BY REGISTERED
AIRMAIL, POSTAGE PREPAID, TO SUCH PARTY AT ITS ADDRESS SET
FORTH IN THIS AGREEMENT. SUCH SERVICE OF PROCESS TO BE
EFFECTIVE UPON ACKNOWLEDGMENT OF RECEIPT OF SUCH REGISTERED
MAIL. NOTHING HEREIN SHALL AFFECT THE RIGHT OF ANY PARTY TO
SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY APPLICABLE
LAW. EACH OF FT AND DT EXPRESSLY ACKNOWLEDGES THAT THE
FOREGOING WAIVER IS INTENDED TO BE IRREVOCABLE UNDER THE
LAWS OF THE STATE OF NEW YORK AND OF THE UNITED STATES OF
AMERICA.
(d) EACH PARTY AGREES THAT MONEY DAMAGES WOULD NOT BE
A SUFFICIENT REMEDY FOR THE OTHER PARTIES FOR ANY BREACH OF
THIS AGREEMENT BY IT, AND THAT IN ADDITION TO ALL OTHER
REMEDIES THE OTHER PARTES MAY HAVE, THEY SHALL BE ENTITLED
TO SPECIFIC PERFORMANCE AND TO INJUNCTIVE OR OTHER
EQUITABLE RELIEF AS A REMEDY FOR ANY SUCH BREACH TO THE
EXTENT PERMITTED BY APPLICABLE LAW. EACH PARTY AGREES NOT
TO OPPOSE THE GRANTING OF SUCH RELIEF IN THE EVENT A COURT
DETERMINES THAT SUCH A BREACH HAS OCCURRED, AND TO WAIVE
ANY REQUIREMENT FOR THE SECURING OR POSTING OF ANY BOND IN
CONNECTION WITH SUCH REMEDY.
Section 7.9. Severability. The invalidity or
unenforceability of any provision hereof in any jurisdiction will
not affect the validity or enforceability of the remainder hereof
in that jurisdiction or the validity or enforceability of this
Agreement, including that provision, in any other jurisdiction.
To the extent permitted by applicable Law, each Party waives any
provision of law that renders any provision hereof prohibited or
unenforceable in any respect. If any provision of this Agreement
is held to be unenforceable for any reason, to the extent
permitted by applicable Law it shall be adjusted rather than
voided, if possible, in order to achieve the intent of the
Parties to the extent possible.
Section 7.10. Translation.
(a) The Parties have negotiated this Agreement in the
English language and have prepared successive drafts and
the definitive text of this Agreement in the English
language. For purposes of complying with the French
Translation Law, Sprint has prepared and the other Parties
have reviewed a French version of this Agreement, which
French version was executed and delivered simultaneously
with the execution and delivery of the English version
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hereof, such English version having likewise been executed
and delivered. The Parties deem the French and English
versions of this Agreement to be equally authoritative.
(b) The Parties acknowledge that the PCS Restructuring
Agreement, Initial Charter Amendment, the Subsequent
Charter Amendment, the Qualified Stock Purchaser Standstill
Agreement (as such term is defined in the Amended and
Restated Stockholders' Agreement), Sprint Stock Payment
Notes (as such term is defined in the Amended and Restated
Stockholders' Agreement) and Sprint Eligible Notes (as such
term is defined in the Amended and Restated Stockholders'
Agreement), and any draft forms thereof, are not required
to be translated into the French language to comply with
the French Translation Law and that the Exhibits to the
Letter Agreement are either not required to be translated
into the French language prior to the Primary Closing to
comply with the French Translation Law or are not required
to be translated into the French language either before or
after the Primary Closing to comply with the French
Translation Law.
Section 7.11. Table of Contents; Headings; Counterparts.
The table of contents and the headings in this Agreement are for
convenience of reference only and will not affect the
construction of any provisions hereof. This Agreement may be
executed in one or more counterparts, each of which when so
executed and delivered will be deemed an original but all of
which will constitute one and the same Agreement.
Section 7.12. Waiver of Immunity. Each of FT and DT agrees
that, to the extent that it or any of its property is or becomes
entitled at any time to any immunity on the grounds of
sovereignty or otherwise based upon its status as an agency or
instrumentality of government from any legal action, suit or
proceeding or from set off or counterclaim relating to this
Agreement from the jurisdiction of any competent court described
in Section 7.8, from service of process, from attachment prior to
judgment, from attachment in aid of execution of a judgment, from
execution pursuant to a judgment or arbitral award, or from any
other legal process in any jurisdiction, it, for itself and its
property expressly, irrevocably and unconditionally waives, and
agrees not to plead or claim, any such immunity with respect to
such matters arising with respect to this Agreement or the
subject matter hereof (including any obligation for the payment
of money). Each of FT and DT agrees that the waiver in this
provision is irrevocable and is not subject to withdrawal in any
jurisdiction or under any statute, including the Foreign
Sovereign Immunities Act, 28 U.S.C. P. 1602 et seq. The foregoing
waiver shall constitute a present waiver of immunity at any time
any action is initiated against FT or DT with respect to this
Agreement.
Section 7.13. Continuing Director Approval. Where
Continuing Director approval is otherwise explicitly required
under this Agreement with respect to a transaction or
determination on the part of Sprint, such approval shall not be
required if (a) the Fair Price Provisions have been deleted in
their entirety, (b) the Fair Price Provisions have been modified
so as explicitly not to apply to any holder of Class A Common
Stock, or they have been modified in a manner reasonably
satisfactory to FT and DT so as explicitly not to apply to any
transactions with any holder of Class A Common Stock contemplated
by the Amended Other Agreements or the Articles as amended by
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the Proposed Charter Amendments, (c) the transaction in question
is not a "Business Combination" within the meaning of the Fair
Price Provisions, or (d) the holder of Class A Common Stock that
is a party to the transaction, along with its Affiliates (as such
term is defined in Rule 12b-2 under the Exchange Act, as in
effect on October 1, 1982) and Associates (as such term is
defined in Rule 12b-2 under the Exchange Act, as in effect on
October 1, 1982), is not an "Interested Stockholder" or an
"Affiliate" of an "Interested Stockholder" within the meaning of
the Fair Price Provisions. Where this Agreement provides that
Continuing Director approval is explicitly required to undertake
a transaction or make a determination on the part of Sprint,
Sprint shall not undertake such transaction or make such
determination unless it first delivers a certificate, signed by a
duly authorized officer of Sprint, to each of FT and DT
certifying that such approval either has been obtained or is not
required as set forth in the preceding sentence, and FT and DT
shall be entitled to rely on such certificate.
Section 7.14. Changes in Law. The inclusion by the Parties
in the Amended Other Agreements and by Sprint in the Proposed
Charter Amendments of provisions contained in the Initial Other
Agreements and in the existing Articles which provided for the
termination, modification or vesting of certain rights and
obligations of the parties upon a change in the Law relating to
the United States Communications Act of 1934 is not intended to
create an inference that the Parties believe that no such changes
in the Law have occurred since the date of the Initial Other
Agreements and such provisions shall be interpreted with
reference to the respective dates of the Initial Other Agreements
and the date of filing of the Articles in connection with the
closing of the transactions contemplated by the Original
Investment Agreement.
Section 7.15. Currency. All amounts payable under this
Agreement and the Amended Other Agreements shall be payable in
U.S. dollars.
ARTICLE VIII
DEFINITIONS
-----------
Section 8.1. Certain Definitions. As used in this
Agreement, the following terms shall have the meanings specified
below:
"Acquiring Person Statement" means the acquiring person
statement dated November 17, 1995, delivered by FT, DT and
certain of their Affiliates pursuant to Section 17-1291 of the
Kansas Control Share Acquisitions Statute.
"Affiliates" means, with respect to any Person, any other
Person that directly or indirectly through one or more
intermediaries controls, is controlled by, or is under common
control with such Person. For purposes of this definition, the
term "controls" (including its correlative meanings "controlled
by" and "under common control with") shall mean the possession,
direct or indirect, of
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the power to direct or cause the direction of the management and
policies of a Person, whether through the ownership of voting
securities, by contract or otherwise.
"Agreement" means this Master Restructuring and Investment
Agreement, including the Schedules attached hereto.
"Amended and Restated Confidentiality Agreements" means the
Amended and Restated DT Investor Confidentiality Agreement and
the Amended and Restated FT Investor Confidentiality Agreement.
"Amended and Restated DT Investor Confidentiality
Agreement" means the confidentiality agreement between Sprint and
DT, in form reasonably satisfactory to each of the Parties.
"Amended and Restated FT Investor Confidentiality
Agreement" means the confidentiality agreement between Sprint and
FT, in form reasonably satisfactory to each of the Parties.
"Amended and Restated Registration Rights Agreement" means
the Amended and Restated Registration Rights Agreement among the
Parties, in form reasonably satisfactory to each of the Parties.
"Amended and Restated Standstill Agreement" means the
Amended and Restated Standstill Agreement among the Parties, in
form reasonably satisfactory to each of the Parties.
"Amended and Restated Stockholders' Agreement" means the
Amended and Restated Stockholders' Agreement among the Parties,
in form reasonably satisfactory to each of the Parties.
"Amended Other Agreements" means the Amended and Restated
Registration Rights Agreement, the Amended and Restated
Standstill Agreement, the Amended and Restated Stockholders'
Agreement, the Amended and Restated DT Investor Confidentiality
Agreement and the Amended and Restated FT Investor
Confidentiality Agreement.
"Applicable Closing" means the Primary Closing, the
Secondary Closing or the Greenshoe Closing, as provided by the
context of the sentence.
"Articles" means the Articles of Incorporation of Sprint,
as amended from time to time, including pursuant to the Proposed
Charter Amendments.
"Associate" has the meaning ascribed to such term in Rule
12b-2 under the Exchange Act, provided that when used to indicate
a relationship with FT or DT or their respective Subsidiaries or
Affiliates, the term "Associate" shall mean (a) in the case of
FT, any Person occupying any of the positions listed on Schedule
8.1(a) hereto, and (b) in the case of DT, any Person occupying
any of the positions listed on Schedule 8.1(b) hereto, provided,
further, that, in each case, no Person occupying any such
position described in clause (a) or clause (b) hereof shall be
deemed an
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"Associate" of FT or DT, as the case may be, unless the Persons
occupying all such positions described in clauses (a) and (b)
hereof Beneficially Own, in the aggregate, more than 0.2% of the
Voting Power of Sprint. .
"Beneficial Owner" (including, with its correlative
meanings, "Beneficially Own" and "Beneficial Ownership"), with
respect to any securities, shall mean any Person which:
(a) has, or any of whose Affiliates or Associates has,
directly or indirectly, the right to acquire (whether such right
is exercisable immediately or only after the passage of time)
such securities pursuant to any agreement, arrangement or
understanding (whether or not in writing), including pursuant to
the Original Investment Agreement, this Agreement and the Amended
and Restated Stockholders' Agreement, or upon the exercise of
conversion rights, exchange rights, warrants or options, or
otherwise;
(b) has, or any of whose Affiliates or Associates has,
directly or indirectly, the right to vote or dispose of (whether
such right is exercisable immediately or only after the passage
of time) or "beneficial ownership" of (as determined pursuant to
Rule 13d-3 under the Exchange Act as in effect on the date hereof
but including all such securities which a Person has the right to
acquire beneficial ownership of, whether or not such right is
exercisable within the 60-day period specified therein) such
securities, including pursuant to any agreement, arrangement or
understanding (whether or not in writing); or
(c) has, or any of whose Affiliates or Associates has,
any agreement, arrangement or understanding (whether or not in
writing) for the purpose of acquiring, holding, voting or
disposing of any securities which are Beneficially Owned,
directly or indirectly, by any other Person (or any Affiliate
thereof),
provided that (i) Class A Common Stock, FON Stock and PCS Stock
held by one of FT or DT or its Affiliates or Associates shall not
also be deemed to be Beneficially Owned by the other of FT or DT
or its Affiliates or Associates; (ii) FON Stock and PCS Stock
shall not be deemed to be Beneficially Owned by FT, DT or their
Affiliates or Associates by virtue of the top up rights and
standby commitments granted under the Purchase Rights Agreement
except to the extent that FT, DT or their Affiliates or
Associates have (A) acquired shares of FON Stock or PCS Stock
pursuant to the Purchase Rights Agreement, or (B) become
irrevocably committed to acquire, and the Cable Partners have
become irrevocably committed to sell, shares of Sprint FON Stock
or Sprint PCS Stock pursuant to the Purchase Rights Agreement
(with such Beneficial Ownership to be determined on a full-voting
basis), subject only to customary closing conditions, if any; and
(iii) FT, DT and their Affiliates and Associates shall not be
deemed to Beneficially Own any incremental Voting Power resulting
solely from the increase in Voting Power provided for by the
application of Section 7.5(d) of the Articles.
"Board of Directors" means the board of directors of
Sprint.
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"Business Day" means any day other than a day on which
commercial banks in the City of New York, Paris, France or
Frankfurt am Main, Germany, are required or authorized by law to
be closed.
"Buyers" means DT and FT.
"Bylaw Amendment" means the amendment to the Bylaws in form
reasonably satisfactory to each Party to be effected by the Board
of Directors of Sprint in connection with this Agreement and the
PCS Restructuring Agreement.
"Cable Partner Registration Rights Agreement" means the
registration rights agreement among Sprint and the Cable Partners
to be entered into pursuant to the PCS Restructuring Agreement.
"Cable Partners" means TCI, Comcast and Cox.
"Change of Control" means a:
(a) decision by the Board of Directors to sell Control
of Sprint or not to oppose a third party tender offer for
Voting Securities of Sprint representing more than 35% of
the Voting Power of Sprint; or
(b) change in the identity of a majority of the
Directors due to (i) a proxy contest (or the threat to
engage in a proxy contest) or the election of Directors by
the holders of any series of Preferred Stock of Sprint; or
(ii) any unsolicited tender, exchange or other purchase
offer which has not be approved by a majority of the
Independent Directors,
provided that a Strategic Merger shall not be deemed to be a
Change of Control and, provided, further, that any transaction
between Sprint and FT and DT or otherwise involving FT and DT and
any of their direct or indirect Subsidiaries which are party to a
contract therefor shall not be deemed to be a Change of Control.
"Class A Common Stock" means the Class A Common Stock of
Sprint, as provided for in the Articles, including the Old Class
A Common Stock and the Class A Common Stock -- Series DT (each as
referred to in the Proposed Charter Amendments).
"Class A Holders" means the holders of the Class A Stock.
"Class A Provisions" has the meaning set forth in the
Articles, as amended from time to time, including by the Proposed
Charter Amendments.
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"Class A Stock" means (i) prior to the Primary Closing, the
Class A Common Stock, (ii) following the Primary Closing, but
prior to the Recapitalization, the Class A Common Stock and the
Series 3 PCS Stock, and (iii) following the Recapitalization, the
Class A Common Stock, the Series 3 FON Stock and the Series 3 PCS
Stock.
"Closing Price" means, with respect to a security on any
day, the last sale price, regular way, or in case no such sale
takes place on such day, the average of the closing bid and asked
prices, regular way, in either case as reported in the principal
consolidated transaction reporting system with respect to
securities listed or admitted to trading on The New York Stock
Exchange, Inc. or, if such security is not listed or admitted to
trading on such exchange, as reported in the principal
consolidated transaction reporting system with respect to
securities listed on the principal national securities exchange
on which the security is listed or admitted to trading or, if the
security is not listed or admitted to trading on any national
securities exchange, the last quoted sale price or, if not so
quoted, the average of the high bid and low asked prices in the
over-the-counter market, as reported by NASDAQ or such other
system then in use, or, if on any such date such security is not
quoted by any such organization, the average of the closing bid
and asked prices as furnished by a professional market maker
making a market in the security selected in good faith by the
Board of Directors. If the security is not publicly held or so
listed or publicly traded, "Closing Price" means the Fair Market
Value of such security.
"Code" means the Internal Revenue Code of 1986, as amended,
and the rules and regulations promulgated thereunder.
"Comcast" means Comcast Corporation, a Pennsylvania
corporation.
"Common Stock" means the Common Stock, par value U.S. $2.50
per share, of Sprint.
"Continuing Director" means any Director who is
unaffiliated with the Buyers and their "affiliates"and
"associates" (as each such term is defined in Rule 12b-2 under
the Securities Exchange Act of 1934, as in effect on October 1,
1982) and was a Director prior to the time that any Buyer or such
affiliate or associate became an Interested Stockholder (as such
term is defined in the Fair Price Provisions), and any successor
of a Continuing Director if such successor is not affiliated with
any such Interested Stockholder and is recommended or elected to
succeed a Continuing Director by a majority of Continuing
Directors, provided that such recommendation or election shall
only be effective if made at a meeting of Directors at which at
least seven Continuing Directors are present.
"Contract" means any loan or credit agreement, note, bond,
indenture, mortgage, deed of trust, lease, franchise, contract,
or other agreement, obligation, instrument or binding commitment
of any nature.
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"Control" means, with respect to a Person or Group, any of
the following:
(a) ownership by such Person or Group of Votes
entitling it to exercise in the aggregate more than 35
percent of the Voting Power of the entity in question; or
(b) possession by such Person or Group of the power,
directly or indirectly, (i) to elect a majority of the
board of directors (or equivalent governing body) of the
entity in question; or (ii) to direct or cause the
direction of the management and policies of or with respect
to the entity in question, whether through ownership of
securities, by contract or otherwise.
"Cox" means Xxx Communications, Inc., a Delaware
corporation.
"CP Closing" means the consummation of the Mergers (as
defined in the PCS Restructuring Agreement) and the other
transactions contemplated by the PCS Restructuring Agreement.
"CP Exchange" means the issuance of shares of Series 2 PCS
Stock by Sprint at the CP Closing in exchange for certain
interests owned by the Cable Partners pursuant to the PCS
Restructuring Agreement.
"CP/FT-DT Top Up Purchase" means the purchase by the Cable
Partners under the PCS Restructuring Agreement of shares of
Series 2 PCS Stock in connection with the purchase by FT and DT
of shares of Sprint capital stock pursuant to this Agreement.
"CP/Greenshoe Top Up Purchase" means the purchase by the
Cable Partners under the PCS Restructuring Agreement of shares of
Series 2 PCS Stock in connection with the Greenshoe.
"CP/IPO Top Up Purchase" means the purchase by the Cable
Partners under the PCS Restructuring Agreement of shares of
Series 2 PCS Stock in connection with the IPO.
"Director" means a member of the Board of Directors.
"DT" has the meaning set forth in the preamble.
"Exchange Act" means the Securities Exchange Act of 1934,
as amended, and the rules and regulations thereunder.
"Fair Market Value" means, with respect to any asset,
shares or other property, the cash price at which a willing
seller would sell and a willing buyer would buy such asset,
shares or other property in an arm's-length negotiated
transaction without undue time restraints, as determined in good
faith by a majority of the Independent Directors as certified in
a resolution delivered to all of the holders of Class A Stock.
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"Fair Price Provisions" means ARTICLE SEVENTH of the
Articles, and any successor provision thereto.
"FON Stock" means the Series 1 FON Stock, the Series 2 FON
Stock and the Series 3 FON Stock.
"French Translation Law" means the loi n(degree) 94-665 du
4 aout 1994 relative a l'emploi de la langue francaise.
"FT" has the meaning set forth in the preamble.
"FT Law and Decrees" means (a) Act N(degree) 83-675 of July
23, 1983 concerning the democratization of the public sector, (b)
Act. N(degree) 90-568 of July 2, 1990 concerning the organization
of the Post Office and Telecommunications public service as
amended by Act N(degree) 96-660 of July 26, 1996 concerning the
national undertaking France Telecom and (c) Decree N(degree)
96-1174 of December 27, 1996 approving the constitution of France
Telecom, including miscellaneous provisions concerning the
operation of France Telecom.
"GAAP" means United States generally accepted accounting
principles as in effect from time to time.
"German Fee Regulations" means Bundesgebuhrenordnung fur
Rechtsanwalte vom 26. Juli 1957 (BGBI) I S. 907 (as it or any
successor provision is from time to time in effect).
"Governmental Approval" means any consent, waiver, grant,
concession or License of, registration or filing with, or
declaration, report or notice to, any Governmental Authority.
"Governmental Authority" means any federation, nation,
state, sovereign, or government, any federal, supranational,
regional, state, local or political subdivision, any governmental
or administrative body, instrumentality, department or agency or
any court, administrative hearing body, arbitration tribunal,
commission or other similar dispute resolving panel or body, and
any other entity exercising executive, legislative, judicial,
regulatory or administrative functions of a government, provided
that the term "Governmental Authority" shall not include FT, DT,
Atlas S.A.
or any of their respective Subsidiaries.
"Greenshoe" has the meaning set forth in Section 1.3 of
this Agreement.
"Greenshoe Closing" means the consummation of the purchase
by FT and DT of shares of Sprint capital stock pursuant to
Section 1.3 of this Agreement.
"Greenshoe Closing Date" means the date of the Greenshoe
Closing.
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"Greenshoe Top Up Purchase" means the purchase by FT and DT
of a number of shares of Series 3 PCS Stock sufficient for FT and
DT, in the aggregate, to Beneficially Own 25% of the aggregate
Voting Power attributable to the shares of Series 1 PCS Stock and
Series 2 PCS Stock issued in the Greenshoe and the CP/Greenshoe
Top Up Purchase, respectively.
"Group" means any group within the meaning of Section
13(d)(3) of the Exchange Act.
"Independent Director" has the meaning set forth in the
Articles.
"Initial Charter Amendment" means the Amended and Restated
Articles of Incorporation of Sprint in form reasonably
satisfactory to each Party effecting the creation of the PCS
Stock and the creation of the PCS Group and the Sprint FON Group,
which Sprint shall file with the Kansas Governmental Authorities
on or before the Primary Closing Date.
"Initial Other Agreements" means the Registration Rights
Agreement, the Standstill Agreement, the Stockholders' Agreement,
and the Investor Confidentiality Agreements.
"Investor Confidentiality Agreements" means the
Confidentiality Agreement between Sprint and DT dated January 31,
1996 and the Confidentiality Agreement between Sprint and FT
dated January 31, 1996.
"IPO" means the initial primary underwritten public
offering of Series 1 PCS Stock pursuant to an effective
registration statement under the Securities Act, proposed to be
conducted by Sprint in accordance with Sections 5.2 and 5.3, that
Sprint currently expects to generate net proceeds of between $500
million and $1.1 billion.
"IPO Price" means the initial price per share at which
shares of Series 1 PCS Stock are purchased by the public in the
IPO.
"IPO Prospectus" means a prospectus located within the
Registration Statement covering the shares of Series 1 PCS Stock
to be sold in the IPO.
"Kansas Control Share Acquisitions Statute" means Kan.
Stat. Xxx. Section 17-1286 et seq. (1988).
"Knowledge", or any phrase or term of similar meaning, when
used with respect to any of the Parties, means the actual
knowledge of the executive officers of such Party, without having
made any special investigation or inquiry regarding the
applicable subject matter.
"Law" means any foreign or domestic law, statute, code,
ordinance, rule or regulation promulgated, or any order,
judgment, writ, stipulation, award, injunction or decree entered,
by a Governmental Authority.
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"License" means any license, ordinance, authorization,
permit, certificate, variance, exemption, order, franchise or
approval, domestic or foreign.
"Lien" means any lien, pledge, claim, encumbrance, mortgage
or security interest in real or personal property.
"Management and Allocation Policies" means the policies to
be adopted by the Board of Directors, effective as of the Primary
Closing Date, governing the relationship between the PCS Group
(on the one hand) and the Sprint FON Group (on the other hand).
"Material Adverse Effect" on any party hereto means, with
respect to any Party, the effect of any event, occurrence, fact,
condition or change that is materially adverse to the business,
operations, results of operations, financial condition, assets or
liabilities of such Person.
"Original Investment Agreement" has the meaning set forth
in the Recitals to this Agreement.
"Party" and "Parties" have the meaning set forth in the
Recitals to this Agreement.
"PCS Group" has the meaning set forth in the Initial
Charter Amendment.
"PCS Preferred Issuance" means the issuance of the PCS
Preferred Stock pursuant to the PCS Restructuring Agreement.
"PCS Preferred Stock" means the Preferred Stock -- Series 7
of Sprint, no par value per share, which shall be created and
issued pursuant to the terms of the PCS Restructuring Agreement.
"PCS Restructuring Agreement" means the Restructuring and
Merger Agreement, dated as of the date hereof, between Sprint and
the other parties listed therein.
"PCS Stock" means the Series 1 PCS Stock, the Series 2 PCS
Stock, the Series 3 PCS Stock and the PCS Preferred Stock.
"Person" means any individual, corporation, partnership,
limited liability company, trust, unincorporated association or
other entity.
"Primary Closing" means the closing of the actions
contemplated by this Agreement to take place concurrently with
the CP Exchange (which may include the CP Exchange Top Up
Purchase if the conditions to the CP Exchange Top Up Purchase
have been satisfied or waived by the appropriate parties), as
contemplated by this Agreement, held on the date and at the place
fixed in accordance with Article I.
"Primary Closing Date" means the date of the Primary
Closing.
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"Proceeding" means any action, litigation, suit, proceeding
or formal investigation or review of any nature, civil, criminal,
regulatory or otherwise, before any Governmental Authority.
"Proposed Charter Amendments" means the Initial Charter
Amendment and the Subsequent Charter Amendment.
"Proxy Statement" means a proxy statement to be mailed to
Sprint stockholders in connection with the Stockholders Meeting.
"Purchase Rights Agreement" means the Top Up Right
Agreement dated May 26, 1998 among FT, DT and the Cable Partners
as in effect on the date hereof.
"Recapitalization" means the reclassification of Sprint
Common Stock into Series 1 FON Stock and Series 1 PCS Stock to be
effected by the filing of the Subsequent Charter Amendment.
"Registration Rights Agreement" means the Registration
Rights Agreement dated as of January 31, 1996, between Sprint, FT
and DT.
"Registration Statement" means a registration statement on
Form S-3 containing the IPO Prospectus covering the shares of
Series 1 PCS Stock to be sold in the IPO.
"SEC" means the Securities and Exchange Commission.
"Secondary Closing" means the consummation of the purchase
by FT and DT of shares of Sprint capital stock pursuant to
Section 1.2 of this Agreement.
"Secondary Closing Date" means the date of the Secondary
Closing.
"Securities Act" means the Securities Act of 1933, as
amended.
"Series 1 FON Stock" means the FON Common Stock -- Series
1, par value to be determined, of Sprint, which will be created
by the filing of the Subsequent Charter Amendment.
"Series 1 PCS Stock" means the PCS Common Stock -- Series
1, par value to be determined, of Sprint, which will be created
on or about the Primary Closing Date by the filing of the Initial
Charter Amendment.
"Series 2 FON Stock"means the FON Common Stock -- Series 2,
par value to be determined, of Sprint, which will be created by
the filing of the Subsequent Charter Amendment.
"Series 2 PCS Stock" means the PCS Common Stock -- Series
2, par value to be determined, of Sprint, which will be created
on or about the Primary Closing Date by the filing of the Initial
Charter Amendment.
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"Series 3 FON Stock" means the FON Common Stock -- Series
3, par value to be determined, of Sprint, which will be created
by the filing of the Subsequent Charter Amendment.
"Series 3 PCS Stock" means the PCS Common Stock -- Series
3, par value to be determined, of Sprint, which will be created
on or about the Primary Closing Date by the filing of the Initial
Charter Amendment.
"Sprint" means Sprint Corporation, a Kansas corporation.
"Sprint FON Group" has the meaning set forth in the Initial
Charter Amendment.
"Sprint PCS" means Sprint Spectrum L.P., a Delaware limited
partnership.
"SprintSub" means Sprint Global Venture, Inc., a
wholly-owned subsidiary of Sprint.
"Standstill Agreement" means the Standstill Agreement,
dated as of July 31, 1995, among Sprint, FT and DT, as amended on
June 24, 1997.
"Stockholders' Agreement" means the Stockholders'
Agreement, dated as of January 31, 1996, among Sprint, FT and DT,
as amended on June 24, 1997.
"Stockholders Meeting" means a special meeting to be held
for the purpose of approving the Initial Charter Amendment, the
Subsequent Charter Amendment and amendments to certain of
Sprint's equity-based incentive plans in connection with the
creation of the PCS Stock, among other things.
"Strategic Merger" means a merger or other business
combination involving Sprint (a) in which the Class A Holders are
entitled to retain or receive, as the case may be, voting equity
securities of the surviving parent entity in exchange for or in
respect of (by conversion or otherwise) such Class A Stock, with
an aggregate Fair Market Value equal to at least 75% of the sum
of (i) the Fair Market Value of all consideration which such
Class A Holders have a right to receive with respect to such
merger or other business combination, and (ii) if Sprint is the
surviving parent entity, the Fair Market Value of the equity
securities of the surviving parent entity which the Class A
Holders are entitled to retain, (b) immediately after which the
surviving parent entity is an entity whose voting equity
securities are registered pursuant to Section 12(b) or Section
12(g) of the Exchange Act or which otherwise has any class or
series of its voting equity securities held by at least 500
holders and (c) immediately after which no Person or Group (other
than the Class A Holders) owns Voting Securities of such
surviving parent entity with Votes equal to more than 35 percent
of the Voting Power of such surviving parent entity.
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"Subsequent Charter Amendment" means the Amendment to the
Restated Articles of Incorporation of Sprint in form reasonably
satisfactory to each Party effecting the Recapitalization, which
Sprint shall file with the Kansas Governmental Authorities either
(i) on or before the Primary Closing Date or (ii) within 120 days
following the Primary Closing.
"Subsidiary" of any Person as of any relevant date means a
corporation, company or other entity (i) more than 50% of whose
outstanding shares or equity securities are, as of such date,
owned or controlled, directly or indirectly through one or more
Subsidiaries, by such Person, and the shares or securities so
owned entitle such Person and/or its Subsidiaries to elect at
least a majority of the members of the board of directors or
other managing authority of such corporation, company or other
entity notwithstanding the vote of the holders of the remaining
shares or equity securities so entitled to vote or (ii) which
does not have outstanding shares or securities, as may be the
case in a partnership, joint venture or unincorporated
association, but more than 50% of whose ownership interest is, as
of such date, owned or controlled, directly or indirectly through
one or more Subsidiaries, by such Person, and in which the
ownership interest so owned entitles such Person and/or
Subsidiaries to make the decisions for such corporation, company
or other entity.
"TCI" means Tele-Communications, Inc., a Delaware
corporation.
"Third Party Approval" means any consent, waiver, grant,
concession, license, authorization, permit, franchise or approval
of, or notice to, any Person other than a Governmental Authority.
"Top Up Note" means notes of FT or DT, as applicable, in
form reasonably satisfactory to each of the Parties, made payable
to Sprint.
"Trading Days" means with respect to any security, any day
on which the principal national securities exchange on which such
security is listed or admitted to trading or NASDAQ, if such
security is listed or admitted to trading thereon, is open for
the transaction of business (unless such trading shall have been
suspended for the entire day) or, if such security is not listed
or admitted to trading on any national securities exchange or
NASDAQ, any day other than a Saturday, Sunday, or a day on which
banking institutions in the State of New York are authorized or
obligated by law or executive order to close.
"Transfer" means any act pursuant to which, directly or
indirectly, the ownership of assets or securities in question is
sold, exchanged, assigned, transferred, conveyed, delivered or
otherwise disposed of.
"Trigger Date" means the date that the conditions to
closing set forth in Sections 8.1(a), 8.1(b) and 8.1(d) of the
PCS Restructuring Agreement have been satisfied or waived.
"Volume Weighted Trading Average" means, with respect to
any share of capital stock as of a specific date, the
volume-weighted average Closing Price for the 20 consecutive
Trading Days ending on the last Trading Day prior to such date.
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"Vote" means, with respect to any entity, the ability to
cast a vote at a stockholders', members' or comparable meeting of
such entity with respect to the election of directors, managers
or other members of such entity's governing body, or the ability
to cast a general partnership or comparable vote, provided that
with respect to Sprint only, the term "Vote" means the ability to
exercise general voting power (as opposed to the exercise of
special voting or disapproval rights such as those set forth in
ARTICLE SIXTH of the Articles) with respect to matters other than
the election of directors at a meeting of the stockholders of
Sprint.
"Voting Power" means, with respect to any entity as at any
date, the aggregate number of Votes outstanding as at such date
in respect of such entity.
"Voting Securities" means, with respect to an entity, any
capital stock or debt securities of such entity if the holders
thereof are ordinarily, in the absence of contingencies, entitled
to a Vote, even though the right to such Vote has been suspended
by the happening of such a contingency, and in the case of
Sprint, shall include, without limitation, the Common Stock and
the Class A Stock, but shall not include any shares issued
pursuant to the Rights Agreement to the extent such issuance is
caused by action of a holder of the Class A Stock.
"Wholly-Owned Subsidiary" means, as to any Person, a
Subsidiary of such Person in which 100% of the equity and voting
interest is owned, directly or indirectly, by such Person.
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IN WITNESS WHEREOF, the Parties have caused this Agreement
to be duly executed as of the date first above written.
SPRINT CORPORATION
By: /s/ Xxxxxxx X. Xxxxx
--------------------------------
Name: Xxxxxxx X. Xxxxx
Title: Chairman and Chief
Executive Officer
FRANCE TELECOM S.A.
By: /s/ Xxxxxxx Xxxxxx
--------------------------------
Name: Xxxxxxx Xxxxxx
Title: Senior Vice President
DEUTSCHE TELEKOM AG
By: /s/ Xxxxxx Xxxxxxxxxxxx
--------------------------------
Name: Xxxxxx Xxxxxxxxxxxx
Title: Senior Executive Director
-56-
Schedule 3.2
Authorized Capital Stock
Common Stock 1,000,000,000 shares
Class A Common Stock 500,000,000 shares
Preferred Stock 20,000,000 shares
Shares of Capital Stock issued and outstanding at March 31, 1998.
Common-Issued 350,273,927 shares (1)
Common-Outstanding 344,303,011 shares (1)(2)
Class A Common 86,236,036 shares
Preferred Stock - First
Series, Convertible 42,515 shares
Preferred Stock - Second
Series, Convertible 254,211 shares
Preferred Stock - Fifth
Series 95 shares
Treasury Shares 5,970,916 shares (3)
(1) Includes estimate of aggregate shares issuable in Centel
merger based on outstanding Centel shares on date of merger and
exchange rate of 1.37 Sprint shares for each Centel share. No
fractional shares are issued in the exchange; therefore, as
exchanges occur, the original estimate must be adjusted, which is
done on a quarterly basis.
(2) Number reported on Sprint's Quarterly Report on Form 10-Q for
the quarter ended March 31, 1998. Includes 24,467 shares issuable
in connection with options exercised in March, 1998, but not
issued until April, 1998, and excludes 50,000 shares purchased by
Sprint in March, 1998, but not transferred into Sprint's name
until April, 1998.
(3) Excludes 24,467 shares issuable in connection with options
exercised in March, 1998, but not issued until April, 1998, and
includes 50,000 shares purchased by Sprint in March, 1998, but
not transferred into Sprint's name until April, 1998.
Stockholder agreements, voting trusts and other Contracts
relating to the voting or transfer (including purchase) of any
shares or units of any Voting Securities of Sprint
Fidelity Trust Agreement between Sprint Corporation and Fidelity
Management Trust Company
Includes provisions regarding the voting by the Trustee of
shares of Sprint Common Stock in the following plans:
(1) Sprint Retirement Savings Plan for Bargaining
Unit Employees
(2) Sprint Retirement Savings Plan (includes TRASOP
and ESOP Suspense Account)
(3) Centel Retirement Savings Plan for Bargaining
Unit Employees
Centel Employees' Stock Ownership Trust between Centel
Corporation and The Northern Trust Company.
Includes provisions regarding the voting by the
Trustee of shares of Sprint Common Stock in the Centel
ESOP.
Agreement and Plan of Merger dated as of May 27, 1992, among
Sprint Corporation, FW Sub Inc and Centel Corporation (holders of
Centel common stock who have not exchanged their Centel
certificates for Sprint Common Stock are not permitted to vote
the shares of Sprint Common Stock to which they are entitled).
Various agreements with employees under employee stock plans
(restrict transfer of shares of Sprint Common Stock issued to
employees under the plans).
PCS Restructuring Agreement and related agreements with the Cable
Partners.
Schedule 3.5
A. Governmental Approvals.
1. Satisfaction of all applicable requirements under
state securities or blue sky laws and the filing and
clearance of the Proxy Statement and the IPO
Registration Statement with the SEC.
2. The Series 1 PCS Stock and the Series 1 FON Stock
shall have been approved for listing on the New York
Stock Exchange or if not so approved, shall have been
approved for listing on the American Stock Exchange or
approved for quotation on the National Association of
Securities Dealers Automated National Market System.
3. Filing of the Charter Amendments with the appropriate
Kansas Governmental Authorities.
4. Approvals required for the Restructuring.
(a) Notification pursuant to the Xxxx-Xxxxx-Xxxxxx
Antitrust Improvements Act of 1976, as amended,
and the expiration or termination of all
applicable waiting periods thereunder and any
extensions thereof.
(b) Consents required from the FCC shall have been
granted.
B. Third Party Approvals.
1. Approval of the Charter Amendments and related matters
by the stockholders of Sprint by the requisite vote
C. Defaults, Conflicts, Etc.
Any default (or any event that, with notice or lapse of
time or both, would become a default), or any event which
would give rise to any right of termination by any third
party, or any cancellation, amendment or acceleration of
any obligation or the loss of any benefit under, or the
creation of any Lien on, any of the assets or property of
Sprint or any of its Subsidiaries, arising in each case
solely from a failure to obtain any Governmental Approval
as listed in Section A of this Schedule 3.5 or any Third
Party Approval as listed in Section B of this Schedule 3.5.
D. Violations, Conflicts, Etc. with Applicable Law.
See Sections A and B of this Schedule 3.5.
Schedule 8.1(a)
Associates of FT
All members of the FT Board of Directors, except for any such
members appointed by either the Government of France or any union
or employee group or any such members representing FT's publicly
traded shares.
Executive Officers:
Chief Executive Officer
Members of the Executive Committee:
Large Business Division
Development Division
Finance Division
Network Division
Residential and Small Business Division
Other Officers:
General Secretary
Director of Human Resources
Director of Public Affairs
Director of Corporate Communications
Schedule 8.1(b)
Associates of DT*
The term "Associate," as used with respect to DT, shall mean any
person occupying any of the positions below:
A. Management Board Members
1. Chairman of the Management Board
2. Management Board Member, Business Customers
3. Management Board Member, International
4. Management Board Member, Networks
5. Management Board Member, Finance & Auditing
B. General Managers and Others
1. Corporate Policy, Corporate Strategy, Auditing
2. International Mergers & Acquisitions
3. Global Relationships
4. International Networks
5. International Finance/Mergers & Acquisitions
--------
* In the event of a reorganization of DT, this listing shall
be deemed to be revised to include any successor position
that includes or otherwise incorporates duties and
responsibilities substantially similar in nature and scope
as the duties and responsibilities of the positions listed
herein.
If DT creates the position of General Counsel having
functions and responsibilities comparable to the typical
functions and responsibilities of a General Counsel of a
U.S. public company, such General Counsel position shall
become part of the foregoing list of positions of DT
Associates.
