EXHIBIT 1.1
$280,000,000
CFW COMMUNICATIONS COMPANY
280,000 UNITS EACH UNIT CONSISTING OF ONE 13% SENIOR NOTE DUE 2010 AND ONE
WARRANT
PLACEMENT AGREEMENT
July 21, 2000
July 21, 2000
Xxxxxx Xxxxxxx & Co. Incorporated
First Union Securities, Inc.
SunTrust Equitable Securities Corporation
c/o Morgan Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs and Mesdames:
CFW COMMUNICATIONS COMPANY, a Virginia corporation (the "Company"),
proposes to issue and sell to the several purchasers named in Schedule I hereto
(the "Placement Agents") an aggregate of 280,000 Units (the "Units"), consisting
of (i) $280,000,000 principal amount of its 13% Senior Notes due 2010 (the
"Notes") and (ii) Warrants (the "Warrants"), entitling the holders thereof to
purchase initially an aggregate of 504,000 shares of the Company's common stock,
no par value (the "Common Stock") at an exercise price of $47.58 per share,
subject to adjustment as provided in the Warrant Agreement (defined below). The
Notes will be issued pursuant to the provisions of an Indenture dated as of July
26, 2000 (the "Indenture") between the Company and The Bank of New York, as
Trustee (the "Trustee"). The Warrants will be issued pursuant to the provisions
of a Warrant Agreement (the "Warrant Agreement") between the Company and The
Bank of New York, as warrant agent (in such capacity, the "Warrant Agent"). The
Units, the Notes and the Warrants are collectively referred to herein as the
"Securities." The Company will pledge pursuant to an Escrow and Security
Agreement by and among the Company, the Trustee and The Bank of New York, as
Escrow Agent (the "Escrow Agreement") to be dated as of the Closing Date (as
defined below) made by the Company in favor of the Trustee approximately $267.7
million of the net proceeds from the issuance and sale of the Securities (i) as
security for the payment of the first four scheduled interest payments due on
the Securities and (ii) to partially fund the redemption of the Securities at
101% of their principal amount, plus accrued and unpaid interest to the Special
Redemption Date (as defined in the Escrow Agreement) in the event that any of
(i) the acquisition (the "Richmond-Norfolk Acquisition") of certain of the
licenses and assets in the Richmond Major Trading Area (the "Richmond-Norfolk
Operations") of PrimeCo PCS, L.P. ("PrimeCo"), (ii) the funding of the Company's
new senior credit facility in the amount of $325.0 million (the "Credit
Facility") or (iii) the sale and issuance of the Series C Preferred Stock and
the Series D Preferred Stock (each as defined herein), are not consummated on or
prior to October 2, 2000, subject to an extension to December 17, 2000, unless
each of the aforementioned events closes on the Closing Date (as defined below).
As used herein, the term "Transactions" shall have the meaning set forth in the
Final Memorandum, as defined below.
The Company also proposes to issue and sell pursuant to a purchase
agreement between the Company and the purchaser dated as of July 26, 2000 (the
"Subordinated Note Purchase Agreement"), $95,000,000 principal amount of its 13
1/2% subordinated notes due
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2011 (the "Subordinated Notes"). The Subordinated Notes will be issued pursuant
to an Indenture dated as of July 26, 2000 between the Company and The Bank of
New York, as trustee (the "Subordinated Note Indenture"). The purchaser of the
Subordinated Notes will be entitled to the benefits of a registration rights
agreement relating to the Subordinated Notes dated as of July 26, 2000 between
the Company and the purchaser (the "Subordinated Note Registration Rights
Agreement").
The Securities will be offered and sold without being registered under
the Securities Act of 1933, as amended (the "Securities Act"), to qualified
institutional buyers in compliance with the exemption from registration provided
by Rule 144A under the Securities Act.
The Placement Agents and their direct and indirect transferees will be
entitled to the benefits of (i) a Registration Rights Agreement relating to the
Notes, dated July 26, 2000 between the Company and the Placement Agents (the
"Note Registration Rights Agreement"), and (ii) a Registration Rights Agreement
relating to the Warrants, dated July 26, 2000 between the Company and the
Placement Agents (the "Warrant Registration Rights Agreement").
In connection with the sale of the Securities, the Company has
prepared a preliminary offering memorandum (the "Preliminary Memorandum") and
will prepare a final offering memorandum (the "Final Memorandum" and, with the
Preliminary Memorandum, each a "Memorandum") including a description of the
terms of the Securities, the terms of the offering and a description of the
Company. As used herein, the term "Memorandum" shall include in each case (i)
any supplements or amendments thereto and (ii) the portions of documents
specifically incorporated by reference therein and any supplements or amendments
thereto.
As used herein, "Material Adverse Effect" or "Material Adverse Change"
means, with respect to any person, a material adverse effect upon or change in
the business, prospects, operations, properties, assets, results of operations
or financial condition of such person.
1. Representations and Warranties. The Company represents and
warrants to, and agrees with, you that:
(a) The Preliminary Memorandum did not contain and the Final
Memorandum, in the form used by the Placement Agents to confirm sales and
on the Closing Date (as defined in Section 4), will not contain any untrue
statement of a material fact or omit to state a material fact necessary to
make the statements therein, in the light of the circumstances under which
they were made, not misleading, except that the representations and
warranties set forth in this paragraph do not apply to statements or
omissions in either Memorandum based upon information relating to any
Placement Agent furnished to the Company in writing by such Placement Agent
through you expressly for use therein.
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(b) The Company has been duly incorporated, is validly existing as a
corporation in good standing under the laws of the jurisdiction of its
incorporation, has the corporate power and authority to own its property
and to conduct its business as described in each Memorandum and is duly
qualified to transact business and is in good standing in each jurisdiction
in which the conduct of its business or its ownership or leasing of
property requires such qualification, except to the extent that the failure
to be so qualified or be in good standing would not have a Material Adverse
Effect on the Company and its subsidiaries, taken as a whole
(c) Each subsidiary of the Company has been duly incorporated, is
validly existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, has the corporate power and authority to
own its property and to conduct its business as described in each
Memorandum and is duly qualified to transact business and is in good
standing in each jurisdiction in which the conduct of its business or its
ownership or leasing of property requires such qualification, except to the
extent that the failure to be so qualified or be in good standing would not
have a Material Adverse Effect on the Company and its subsidiaries, taken
as a whole; all of the issued shares of capital stock of each subsidiary of
the Company have been duly and validly authorized and issued, are fully
paid and non-assessable and are owned directly or indirectly by the
Company, free and clear of all liens, encumbrances, equities or claims
other than those granted to secure the Credit Facility.
(d) This Agreement has been duly authorized, executed and delivered by
the Company.
(e) The Subordinated Note Purchase Agreement has been duly authorized,
executed and delivered by the Company.
(f) The Notes have been duly authorized and, when executed and
authenticated in accordance with the provisions of the Indenture and
delivered to and paid for by the Placement Agents in accordance with the
terms of this Agreement, will be valid and binding obligations of the
Company, enforceable in accordance with their terms, and will be entitled
to the benefits of the Indenture and the Note Registration Rights
Agreement, subject to applicable bankruptcy, insolvency, reorganization or
similar laws affecting the enforcement of creditors' rights generally and
general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law).
(g) The Warrants have been duly authorized and, when executed by the
Company and countersigned by the Warrant Agent as provided in the Warrant
Agreement, and delivered to and paid for by the Placement Agents in
accordance with the terms of this Agreement, will be valid and binding
obligations of the Company, enforceable in accordance with their terms,
subject to applicable bankruptcy, insolvency, reorganization or similar
laws affecting the enforcement of creditors' rights generally and general
principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law), and will be entitled to
the benefits of the Warrant Registration Rights Agreement.
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(h) The Subordinated Notes have been duly authorized and, when
executed and authenticated in accordance with the provisions of the
Subordinated Note Indenture and delivered to and paid for by the purchaser,
will be valid and binding obligations of the Company, enforceable in
accordance with their terms and entitled to the benefits of the
Subordinated Note Indenture and the Subordinated Note Registration Rights
Agreement, subject to applicable bankruptcy, insolvency, reorganization or
similar laws affecting the enforcement of creditors' rights generally and
general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law).
(i) The Indenture has been duly authorized and, when executed and
delivered by the Company, will be valid and binding agreement of the
Company, enforceable in accordance with its terms, subject to applicable
bankruptcy, insolvency, reorganization or similar laws affecting the
enforcement of creditors' rights generally and general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law).
(j) The Subordinated Note Indenture has been duly authorized and, when
executed and delivered by the Company, will be a valid and binding
agreement of the Company, enforceable in accordance with its terms, subject
to applicable bankruptcy, insolvency, reorganization or similar laws
affecting the enforcement of creditors' rights generally and general
principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law).
(k) The Warrant Agreement has been duly authorized and, when executed
and delivered by the Company, will be valid and binding agreement of the
Company, enforceable in accordance with its terms, subject to applicable
bankruptcy, insolvency, reorganization or similar laws affecting the
enforcement of creditors' rights generally and general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law).
(l) The Note Registration Rights Agreement has been duly authorized,
executed and delivered by, and is a valid and binding agreement of, the
Company, enforceable in accordance with its terms, subject to applicable
bankruptcy, insolvency, reorganization or similar laws affecting the
enforcement of creditors' rights generally and general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law) and except as rights to indemnification and contribution
under the Note Registration Rights Agreement may be limited under
applicable law.
(m) The Warrant Registration Rights Agreement has been duly authorized
and, when executed and delivered by the Company, will be a valid and
binding agreement of the Company, enforceable in accordance with its terms,
subject to applicable bankruptcy, insolvency, reorganization or similar
laws affecting the enforcement of creditors' rights generally and general
principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law) and except as rights to
indemnification and contribution under the Warrant Registration Rights
Agreement may be limited under applicable law.
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(n) The Subordinate Note Registration Rights Agreement has been duly
authorized, and when executed and delivered by the Company, will be a valid
and binding agreement of the Company, enforceable in accordance with its
terms, subject to applicable bankruptcy, insolvency, reorganization or
similar laws affecting the enforcement of creditors' rights generally and
general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law) and except as rights to
indemnification and contribution under the Subordinated Note Registration
Rights Agreement may be limited under applicable law.
(o) The Escrow Agreement has been duly authorized and, when executed
and delivered by the Company, will be a valid and binding agreement of the
Company, enforceable in accordance with its terms, subject to applicable
bankruptcy, insolvency, reorganization or similar laws affecting the
enforcement of creditors' rights generally and general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law).
(p) All actions necessary to perfect and protect the security interest
in the Collateral (as defined in the Escrow Agreement) created under the
Escrow Agreement have been duly made or taken and are in full force and
effect, and the Escrow Agreement creates in favor of the Trustee and the
holders of the Securities and, together with such actions, a perfected
first priority security interest in the Collateral, enforceable as against
all creditors of the Company (and any persons purporting to purchase any of
the Collateral from the Company).
(q) The execution and delivery by the Company of, and the performance
by the Company of its obligations under, this Agreement, the Indenture, the
Warrant Agreement, the Note Registration Rights Agreement, the Warrant
Registration Rights Agreement, the Escrow Agreement and the Securities will
not contravene any provision of applicable law or the articles of
incorporation or by-laws of the Company or any agreement or other
instrument binding upon the Company or any of its subsidiaries that is
material to the Company and its subsidiaries, taken as a whole, or any
judgment, order or decree of any governmental body, agency or court having
jurisdiction over the Company or any subsidiary, and no consent, approval,
authorization or order of, or qualification with, any governmental body or
agency is required for the performance by the Company of its obligations
under this Agreement, the Indenture, the Warrant Agreement, the Note
Registration Rights Agreement, the Warrant Registration Rights Agreement,
the Escrow Agreement or the Securities, except such as may be required by
the securities or Blue Sky laws of the various states in connection with
the offer and sale of the Securities and by Federal and state securities
laws with respect to the Company's obligations under the Note Registration
Rights Agreement and the Warrant Registration Right Agreement.
(r) (1) There has not occurred any Material Adverse Change, or any
development which is reasonably likely to result in a Material Adverse
Change, in the Company and its subsidiaries, taken as a whole, from the
description of the Company and its subsidiaries as set forth in the Final
Memorandum, (2) there has not occurred any Material Adverse
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Change, or any development which is reasonably likely to result in a
Material Adverse Change, in R&B Communications, Inc. ("R&B") or its
subsidiaries, taken as a whole, that would constitute a Material Adverse
Change of the Company, its subsidiaries and the Richmond-Norfolk Operations
of PrimeCo, taken as a whole, from the description of the Company and its
subsidiaries set forth in the Final Memorandum and (3) there has not
occurred any Material Adverse Change, or any development which is
reasonably likely to result in a Material Adverse Change, in the Richmond-
Norfolk Operations of PrimeCo that would constitute a Material Adverse
Change in the Company, its subsidiaries and the Richmond-Norfolk Operations
of PrimeCo, taken as a whole, from the description of the Company and its
subsidiaries as set forth in the Final Memorandum.
(s) There are no legal or governmental proceedings pending or
threatened to which the Company or any of its subsidiaries is a party or to
which any of the properties of the Company or any of its subsidiaries is
subject other than proceedings accurately described in all material
respects in each Memorandum and proceedings that would not have a Material
Adverse Effect on the Company and its subsidiaries, taken as a whole, or on
the power or ability of the Company to perform its obligations under this
Agreement, the Indenture, the Warrant Agreement, the Note Registration
Rights Agreement, the Warrant Registration Rights Agreement, the Escrow
Agreement or the Securities or to consummate each of the Transactions.
(t) The Company and its subsidiaries, R&B and its subsidiaries and the
Richmond-Norfolk Operations of PrimeCo have all necessary certificates,
orders, permits, licenses, authorizations, consents and approvals of and
from, and have made all declarations and filings with, all applicable
federal, state, local, foreign supranational, national, regional and other
governmental authorities and all applicable courts and tribunals, to own,
lease, license and use their respective properties and assets and to
conduct their respective businesses in the manner described in the Final
Memorandum, and none of the Company and its subsidiaries, R&B and its
subsidiaries and the Richmond-Norfolk Operations of PrimeCo has received
any notice of proceedings relating to revocation or modification of any
such certificates, orders, permits, licenses, authorizations, consents or
approvals, nor are the Company and its subsidiaries, R&B and its
subsidiaries and the Richmond-Norfolk Operations of PrimeCo in violation
of, or in default under, any applicable federal, state, local, foreign
supranational, national or regional law, regulation, rule, decree, order or
judgment applicable to the Company and its subsidiaries and R&B and its
subsidiaries and the Richmond-Norfolk Operations of PrimeCo, the effect of
which, in the aggregate, would reasonably be expected to have a Material
Adverse Effect on the Company, its subsidiaries and the Richmond-Norfolk
Operations of PrimeCo, taken as a whole, except as described in the Final
Memorandum.
(u) The Company and its subsidiaries (i) are in compliance with any
and all applicable foreign, federal, state and local laws and regulations
relating to the protection of human health and safety, the environment or
hazardous or toxic substances or wastes, pollutants or contaminants
("Environmental Laws"), (ii) have received all permits, licenses or other
approvals required of them under applicable Environmental Laws to
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conduct their respective businesses and (iii) are in compliance with all
terms and conditions of any such permit, license or approval, except where
such noncompliance with Environmental Laws, failure to receive required
permits, licenses or other approvals or failure to comply with the terms
and conditions of such permits, licenses or approvals would not have a
Material Adverse Effect on the Company and its subsidiaries, taken as a
whole.
(v) There are no costs or liabilities associated with Environmental
Laws (including, without limitation, any capital or operating expenditures
required for clean-up, closure of properties or compliance with
Environmental Laws or any permit, license or approval, any related
constraints on operating activities and any potential liabilities to third
parties) which would have a Material Adverse Effect on the Company and its
subsidiaries, taken as a whole.
(w) The Company is not aware of any fact which makes the acquisition
of R&B or the Richmond-Norfolk Acquisition unlikely and none of the
Company, R&B and PrimeCo has received any communication from any regulatory
authority which would have a Material Adverse Effect on the Company's and
PrimeCo's Richmond-Norfolk Operations existing operations, taken as a
whole.
(x) The Asset Exchange Agreement, dated May 17, 2000 between PrimeCo
and Virginia RSA 6 Cellular Limited Partnership, with respect to the
Richmond-Norfolk Acquisition, has been duly authorized, executed and
delivered by, and is a valid and binding agreement of, the Company,
enforceable in accordance with its terms, subject to applicable bankruptcy,
insolvency, reorganization or similar laws affecting the enforcement of
creditors' rights generally and general principles of equity (regardless of
whether such enforceability is considered in a proceeding in equity or at
law).
(y) The Agreement and Plan of Merger, dated June 16, 2000, among the
Company, R&B and R&B Combination Company, with respect to the acquisition
by the Company of R&B, has been duly authorized, executed and delivered by,
and is a valid and binding agreement of the Company, enforceable in
accordance with its terms, subject to applicable bankruptcy, insolvency,
reorganization or similar laws affecting the enforcement of creditors'
rights generally and general principles of equity (regardless of whether
such enforceability is considered in a proceeding in equity or at law).
(z) Each of (1) the Securities Purchase Agreement dated as of July 11,
2000 among the Company, Welsh, Carson, Xxxxxxxx & Xxxxx VIII, L.P. ("WCAS")
and the other purchasers listed on the signature pages thereof
(collectively with WCAS, the "Purchasers") with respect to the Series B
Preferred Stock of the Company (the "Series B Preferred Stock"), (2) the
Shareholders Agreement among the Company and the Purchasers dated as of
July 11, 2000, and (3) the Warrant Agreement among the Company and the
Purchasers dated as of July 11, 2000 has been duly authorized, executed and
delivered by, and is a valid and binding agreement of the Company,
enforceable in accordance with its terms, subject to applicable bankruptcy,
insolvency, reorganization or similar laws affecting the enforcement of
creditors' rights generally and
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general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law).
(aa) The Company is not aware of any fact which makes the issuance and
sale to WCAS and certain other purchasers of Series C Preferred Stock (the
"Series C Preferred Stock") and Series D Preferred Stock (the "Series D
Preferred Stock," together with the Series B Preferred Stock and Series C
Preferred Stock, the "Preferred Shares") in an amount equal to gross
proceeds of $125.0 million unlikely.
(bb) The Company is not and, after giving effect to the offering and
sale of the Securities and the application of the proceeds thereof as
described in the Final Memorandum under the caption "Use of Proceeds," will
not be an "investment company" as such term is defined in the Investment
Company Act of 1940, as amended.
(cc) Neither the Company nor any affiliate (as defined in Rule 501(b)
of Regulation D under the Securities Act, an "Affiliate") of the Company
has directly, or through any agent, (i) sold, offered for sale, solicited
offers to buy or otherwise negotiated in respect of, any security (as
defined in the Securities Act) which is or will be integrated with the sale
of the Securities in a manner that would require the registration under the
Securities Act of the Securities or (ii) engaged in any form of general
solicitation or general advertising in connection with the offering of the
Securities, (as those terms are used in Regulation D under the Securities
Act) or in any manner involving a public offering within the meaning of
Section 4(2) of the Securities Act.
(dd) None of the Company, its Affiliates or any person acting on its
or their behalf (other than the Placement Agents) has engaged or will
engage in any directed selling efforts (within the meaning of Regulation S
under the Securities Act ("Regulation S")) with respect to the Securities.
(ee) Assuming the accuracy of the representations of the Placement
Agents in Section 7 herein and their compliance with their covenants and
agreements therein, it is not necessary in connection with the offer, sale
and delivery of the Securities to the Placement Agents in the manner
contemplated by this Agreement and the Final Memorandum to register the
Securities under the Securities Act or to qualify the Indenture under the
Trust Indenture Act of 1939, as amended.
(ff) The Securities satisfy the requirements set forth in Rule
144A(d)(3) under the Securities Act.
(gg) The Securities and the Escrow Agreement conform in all material
respects to the description thereof contained in the Final Memorandum under
the headings "Description of the Units," "Description of the Notes" and
"Description of the Warrants."
(hh) The Company and its subsidiaries are insured by insurers of
recognized financial responsibility against such losses and risks and in
such amounts as the Company reasonably believes are prudent and customary
in the businesses in which they are
9
engaged; none of the Company or any of its subsidiaries has been refused
any insurance coverage sought or applied for; and none of the Company or
any of its subsidiaries has any reason to believe that it will not be able
to renew its existing insurance coverage as and when such coverage expires
or to obtain similar coverage from similar insurers as may be necessary to
continue its business at a cost that would not have a Material Adverse
Effect on the Company and its subsidiaries, taken as a whole, except as
described in the Final Memorandum and except where such refusal or failure
to renew would not have a Material Adverse Effect on the Company and its
subsidiaries, taken as a whole.
(ii) The Company and its subsidiaries keep accurate books and records
reflecting their respective assets and maintain a system of internal
accounting controls sufficient to provide reasonable assurance that (i)
transactions are executed in accordance with management's general or
specific authorizations; (ii) transactions are recorded as necessary to
permit preparation of consolidated financial statements in conformity with
generally accepted accounting principles and to maintain asset
accountability; (iii) access to assets is permitted only in accordance with
management's general or specific authorization; and (iv) the recorded
accountability for assets is compared with the existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences.
(jj) No labor dispute with the employees of the Company or any of its
subsidiaries exists or, to the knowledge of the Company, is imminent, and
none of the Company or any of its subsidiaries is aware of any existing or
imminent labor disturbance by the employees of any of the Company's or any
of its subsidiaries' principal suppliers, manufacturers, customers or
contractors which, in either case, may reasonably be expected to result in
a Material Adverse Effect on the Company and its subsidiaries, taken as a
whole, except as described in the Final Memorandum.
(kk) The Company and its subsidiaries own, possess or license, or can
acquire on reasonable terms, adequate patents, patent rights, licenses,
inventions, copyrights, know-how (including trade secrets and other
unpatented and/or unpatentable proprietary or confidential information,
systems or procedures), trademarks, service marks, trade names or other
intellectual property (collectively, "Intellectual Property") necessary to
carry on the business now operated by them except for such Intellectual
Property the absence of which would not reasonably be expected to result in
a Material Adverse Effect on the Company and its subsidiaries, taken as a
whole, and none of the Company or any of its subsidiaries has received any
notice or is otherwise aware of any infringement of or conflict with
asserted rights of others with respect to any Intellectual Property
(including Intellectual Property which is licensed) or of any facts or
circumstances which would render any Intellectual Property invalid or
inadequate to protect the interest of the Company or any of its
subsidiaries therein, and which infringement or conflict or invalidity or
inadequacy, would reasonably be expected to result in a Material Adverse
Effect on the Company and its subsidiaries, taken as a whole.
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(ll) The Company and its subsidiaries have good and marketable title
to all material real property owned by them and good title to all other
material properties owned by them and all of the leases and subleases
material to the business of the Company and its subsidiaries, considered as
one enterprise, and under which the Company or any of its subsidiaries hold
properties described in the Final Memorandum, are in full force and effect,
and none of the Company or any of its subsidiaries, has any notice of any
material claim of any sort that has been asserted by anyone adverse to the
rights of the Company or any of its subsidiaries under any of the leases or
subleases mentioned above, or affecting or questioning the rights of the
Company or any of its subsidiaries to the continued possession of the
leased or subleased premises under any such lease or sublease.
(mm) All material United States federal income tax returns of the
Company and its subsidiaries required by law to be filed have been filed
and all taxes shown by such returns or otherwise assessed, which are due
and payable, have been paid, except assessments against which appeals have
been or will be promptly taken and as to which adequate reserves have been
provided. The Company and its subsidiaries have filed all other tax
returns that are required to have been filed by them pursuant to applicable
foreign, federal, state, local or other law except insofar as the failure
to file such returns would not result in a Material Adverse Effect on the
Company and its subsidiaries, taken as a whole, and have paid all taxes due
pursuant to such returns or pursuant to any assessment received by the
Company and its subsidiaries, except for such taxes, if any, as are being
contested in good faith and by appropriate proceedings and as to which
adequate reserves have been provided. The charges, accruals and reserves
on the books of the Company and its subsidiaries in respect of all federal,
state, local and foreign tax liabilities of the Company and its
subsidiaries for any years not finally determined are adequate to meet any
assessments or reassessments for additional income tax for any years not
finally determined, except to the extent of any inadequacy that would not
result in a Material Adverse Effect on the Company and its subsidiaries,
taken as whole.
(nn) The Company has an authorized capitalization as set forth in the
Offering Memorandum, and all of the issued shares of capital stock of the
Company have been duly and validly authorized (or ratified) and issued and
are fully paid and non-assessable; the shares of the Common Stock initially
issuable upon exercise of the Warrants have been duly and validly
authorized and reserved for issuance and, when issued, delivered and paid
for in accordance with the provisions of the Warrants and the Warrant
Agreement, will be duly and validly issued, fully paid and non-assessable.
2. Agreements to Sell and Purchase. Subject to the terms and
conditions and in reliance upon the representations and warranties herein set
forth, the Company hereby agrees to sell to each Placement Agent, and each
Placement Agent agrees, severally and not jointly, to purchase from the Company
the respective principal amount of the Units set forth in Schedule I hereto
opposite its name at a purchase price of $986.10 per Unit (the "Purchase Price")
plus accrued interest, if any, on the Notes to the Closing Date.
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The Company hereby agrees that, without the prior written consent of
Xxxxxx Xxxxxxx & Co. Incorporated on behalf of the Placement Agents, it will
not, during the period beginning on the date hereof and continuing to and
including the Closing Date, offer, sell, contract to sell or otherwise dispose
of any debt of the Company (other than the Credit Facility) or warrants to
purchase debt of the Company substantially similar to the Securities (other than
the sale of the Securities under this Agreement).
3. Terms of Offering. You have advised the Company that the
Placement Agents will make an offering of the Securities purchased by the
Placement Agents hereunder on the terms set forth in this Agreement and to be
set forth in the Final Memorandum, as soon as practicable after this Agreement
is entered into as in your judgment is advisable.
4. Payment and Delivery. Payment of the purchase price for the
Securities shall be made to or at the direction of the Company by wire or other
transfer payable in same day funds against delivery of such Securities for the
respective accounts of the several Placement Agents at 10:00 a.m., New York City
time, on July 26, 2000, or at such other time on the same or such other later
date, but not later than 4:00 p.m. August 4, 2000, as shall be designated in
writing by you. The time and date of such payment are hereinafter referred to as
the "Closing Date."
Delivery of the Securities shall be at such location as the Placement
Agents shall reasonably designate at least two business days in advance of the
Closing Date. Certificates for the Securities shall be in definitive form or
global form, as specified by you, and registered in such names and in such
denominations as you shall request in writing not later than one full business
day prior to the Closing Date. The certificates evidencing the Securities shall
be delivered to you on the Closing Date for the respective accounts of the
several Placement Agents, with any transfer taxes payable in connection with the
transfer of the Securities to the Placement Agents duly paid, against payment of
the Purchase Price therefor.
5. Conditions to the Placement Agents' Obligations. The several
obligations of the Placement Agents to purchase and pay for the Securities on
the Closing Date are subject to the following conditions:
(a) Subsequent to the execution and delivery of this Agreement and
prior to the Closing Date:
(i) there shall not have occurred any downgrading, nor shall any
notice have been given of any intended or potential downgrading or of
any review for a possible change that does not indicate the direction
of the possible change, in the rating accorded the Company or any of
the Company's securities or in the rating outlook for the Company by
any "nationally recognized statistical rating organization," as such
term is defined for purposes of Rule 436(g)(2) under the Securities
Act;
(ii) there shall not have occurred any Material Adverse Change,
or any development which is reasonably likely to result in a Material
Adverse Change, in
12
the Company and its subsidiaries, taken as a whole, from the
description of the Company and its subsidiaries set forth in the Final
Memorandum (exclusive of any amendments or supplements thereto
subsequent to the date of this Agreement) that, in your reasonable
judgment, is material and adverse and that makes it, in your
reasonable judgment, impracticable to market the Securities on the
terms and in the manner contemplated in the Final Memorandum;
(iii) There shall not have occurred any Material Adverse Change,
or any development which is reasonably likely to result in a Material
Adverse Change, in R&B and its subsidiaries, taken as a whole, that
would constitute a Material Adverse Change with respect to the Company
and its subsidiaries, taken together as a whole, after giving effect
to the Transactions, from the description of the Company and its
subsidiaries as set forth in the Final Memorandum, that, in your
reasonable judgment, is material and adverse and that makes it, in
your reasonable judgment, impracticable to market the Securities on
the terms and in the manner contemplated in the Final Memorandum;
(iv) (A) There shall exist no fact that, in your reasonable
judgment, creates a substantial possibility that the R&B merger will
not be consummated and (B) the Company and R&B shall not have received
any communication from any regulatory authority which are, in your
judgment, reasonably likely to be material and adverse to the business
prospects of the Company's existing operations, taken as a whole, that
would be material and adverse to the business prospects of the Company
and its subsidiaries, taken as a whole, after giving effect to the
Transactions;
(v) There shall not have occurred any Material Adverse Change or
any development which is reasonably likely to result in a Material
Adverse Change, in the Richmond-Norfolk Operations of PrimeCo that
would constitute a Material Adverse Change with respect to the Company
and its subsidiaries, taken together as a whole, after giving effect
to the Transactions, from the description of the Company and its
subsidiaries as set forth in the Final Memorandum, that, in your
reasonable judgment, is material and adverse and that makes it, in
your reasonable judgment, impracticable to market the Securities on
the terms and in the manner contemplated in the Final Memorandum; and
(vi) (A) There shall exist no fact that, in your reasonable
judgment, creates a substantial possibility that the Richmond-Norfolk
Acquisition will not be consummated and (B) the Company and PrimeCo
shall not have received any communication from any regulatory
authority which are, in your judgment, reasonably likely to be
material and adverse to the business prospects of PrimeCo and the
Company's existing operations, taken as a whole, that would be
material and adverse to the business prospects of the Company and its
subsidiaries, taken as a whole, after giving effect to the
Transactions.
13
(b) The Placement Agents shall have received on the Closing Date a
certificate, dated the Closing Date and signed by an executive officer of
the Company, to the effect set forth in Section 5(a)(i) and to the effect
that the representations and warranties of the Company contained in this
Agreement are true and correct as of the Closing Date and the Company has
complied with all of the agreements and satisfied all of the conditions on
its part to be performed or satisfied hereunder on or before the Closing
Date.
The officer signing and delivering such certificate may rely upon the
best of his or her knowledge as to proceedings threatened.
(c) The Placement Agents shall have received on the Closing Date an
opinion of Hunton & Xxxxxxxx, outside counsel for the Company, dated the
Closing Date, to the effect set forth in Exhibit A.
(d) The Placement Agents shall have received on the Closing Date an
opinion of Hunton & Xxxxxxxx, special state regulatory counsel for the
Company and R&B, dated the Closing Date, to the effect set forth in Exhibit
B.
(e) The Placement Agents shall have received on the Closing Date an
opinion of Wiley, Rein & Fielding, United States regulatory counsel for the
Company and R&B, dated the Closing Date, to the effect set forth in Exhibit
C.
(f) The Placement Agents shall have received on the Closing Date an
opinion of Xxxxxxxxx Xxxxxx Xxxxxx LLP, regulatory counsel to PrimeCo,
dated the Closing Date, to the effect set forth in Exhibit D.
The above opinions shall be rendered to the Placement Agents at the
request of the Company and shall so state therein.
(g) The Placement Agents shall have received on the Closing Date an
opinion of Shearman & Sterling, counsel for the Placement Agents, dated the
Closing Date, in form and substance satisfactory to you.
(h) The Placement Agents shall have received on each of the date
hereof and the Closing Date a letter, dated the date hereof or the Closing
Date, as the case may be, in form and substance satisfactory to the
Placement Agents, from McGladrey & Xxxxxx, LLP, independent public
accountants, containing statements and information of the type ordinarily
included in accountants' "comfort letters" to underwriters with respect to
the financial statements and certain financial information contained in or
incorporated by reference into the Final Memorandum; provided that the
letter delivered on the Closing Date shall use a "cut-off date" not earlier
than the date hereof.
(i) The Placement Agents shall have received on each of the date
hereof and the Closing Date a letter, dated the date hereof or the Closing
Date, as the case may be, in form and substance satisfactory to the
Placement Agents, from Phibbs, Burkholder, Gieshert & Xxxxxxx, LLP,
independent public accountants, containing statements and
14
information of the type ordinarily included in accountants' "comfort
letters" to underwriters with respect to the financial statements and
certain financial information contained in the Final Memorandum; provided
that the letter delivered on the Closing Date shall use a "cut-off date"
not earlier than the date hereof.
(j) The Placement Agents shall have received on each of the date
hereof and the Closing Date a letter, dated the date hereof or the Closing
Date, as the case may be, in form and substance satisfactory to the
Placement Agents, from PricewaterhouseCoopers LLP, independent public
accountants, containing statements and information of the type ordinarily
included in accountants' "comfort letters" to underwriters with respect to
the financial statements and certain financial information contained in the
Final Memorandum; provided that the letter delivered on the Closing Date
shall use a "cut-off date" not earlier than the date hereof.
(k) The Placement Agents shall have received such other documents and
certificates as are reasonably requested by you or your counsel.
(l) The Units, the Notes and the Warrants shall have been designated
PORTAL securities in accordance with the rules and regulations adopted by
the National Association of Securities Dealers, Inc. relating to trading in
the PORTAL Market.
6. Covenants of the Company. In further consideration of the
agreements of the Placement Agents contained in this Agreement, the Company
covenants with each Placement Agent as follows:
(a) To furnish to you in New York City, without charge, prior to 3:00
p.m. New York City time on the business day next succeeding the date of
this Agreement and during the period mentioned in Section 6(c), as many
copies of the Final Memorandum and any supplements and amendments thereto
as you may reasonably request.
(b) Before amending or supplementing either Memorandum, to furnish to
you a copy of each such proposed amendment or supplement and not to use any
such proposed amendment or supplement to which you reasonably object.
(c) If, during such period after the date hereof and prior to the date
on which all of the Securities shall have been sold by the Placement
Agents, any event shall occur or condition exist as a result of which it is
necessary to amend or supplement the Final Memorandum in order to make the
statements therein, in the light of the circumstances when the Final
Memorandum is delivered to a purchaser, not misleading, or if, in the
opinion of counsel for the Placement Agents, it is necessary to amend or
supplement the Final Memorandum to comply with applicable law, forthwith to
prepare and furnish, at its own expense, to the Placement Agents, either
amendments or supplements to the Final Memorandum so that the statements in
the Final Memorandum as so amended or supplemented will not, in the light
of the circumstances when the Final Memorandum is delivered to a purchaser,
be misleading or so that the Final Memorandum, as amended or supplemented,
will comply with applicable law.
15
(d) To endeavor to qualify the Securities and shares of the Common
Stock issuable upon exercise of the Warrants for offer and sale under the
securities or Blue Sky laws of such jurisdictions as you shall reasonably
request, and to comply with such laws so as to permit the continuance of
sales and dealings therein in such jurisdictions for as long as may be
necessary to complete the distribution of the Securities.
(e) Whether or not the transactions contemplated in this Agreement are
consummated or this Agreement is terminated, to pay or cause to be paid all
expenses incident to the performance of its obligations under this
Agreement, including: (i) the fees, disbursements and expenses of the
Company's counsel and the Company's accountants in connection with the
issuance and sale of the Securities and the shares of the Common Stock
issuable upon exercise of the Warrants and all other fees or expenses in
connection with the preparation of each Memorandum and all amendments and
supplements thereto, including all printing costs associated therewith, and
the delivering of copies thereof to the Placement Agents, in the quantities
herein above specified, (ii) all costs and expenses related to the transfer
and delivery of the Securities and the shares of the Common Stock issuable
upon exercise of the Warrants to the Placement Agents, including any
transfer or other taxes payable thereon, (iii) the cost of printing or
producing any Blue Sky or legal investment memorandum in connection with
the offer and sale of the Securities and the shares of the Common Stock
issuable upon exercise of the Warrants under state securities laws and all
expenses in connection with the qualification of the Securities and the
shares of the Common Stock issuable upon exercise of the Warrants for offer
and sale under state securities laws as provided in Section 6(d) hereof,
including filing fees and the reasonable fees and disbursements of counsel
for the Placement Agents in connection with such qualification and in
connection with the Blue Sky or legal investment memorandum, (iv) any fees
charged by rating agencies for the rating of the Securities, (v) the fees
and expenses, if any, incurred in connection with the admission of the
Securities for trading in PORTAL or any appropriate market system and the
listing of the shares of the Common Stock issuable upon the exercise of the
Warrants on the Nasdaq National Market, (vi) the costs and charges of the
Trustee, the Warrant Agent, the Escrow Agent and any transfer agent,
registrar or depositary, (vii) the cost of the preparation, issuance and
delivery of the Securities, (viii) the costs and expenses of the Company
relating to investor presentations on any "road show" undertaken in
connection with the marketing of the offering of the Securities, including,
without limitation, expenses associated with the production of road show
slides and graphics, but excluding 50% of any travel and lodging expenses
and the cost of any aircraft chartered in connection with the road show,
and (ix) all other costs and expenses incident to the performance of the
obligations of the Company hereunder for which provision is not otherwise
made in this Section. It is understood, however, that except as provided
in this Section, Section 8, and the last paragraph of Section 10, the
Placement Agents will pay all of their costs and expenses, including fees
and disbursements of their counsel, transfer taxes payable on resale of any
of the Securities by them and any advertising expenses connected with any
offers they may make.
16
(f) Neither the Company nor any Affiliate will sell, offer for sale or
solicit offers to buy or otherwise negotiate in respect of any security (as
defined in the Securities Act) which could be integrated with the sale of
the Securities in a manner which would require the registration under the
Securities Act of the Securities.
(g) Not to solicit any offer to buy or offer or sell the Securities by
means of any form of general solicitation or general advertising (as those
terms are used in Regulation D under the Securities Act) or in any manner
involving a public offering within the meaning of Section 4(2) of the
Securities Act.
(h) While any of the Securities remain "restricted securities" within
the meaning of the Securities Act, to make available, upon request, to each
holder of the Securities and to each prospective purchaser designated by
such holder the information specified in Rule 144A(d)(4) under the
Securities Act, unless the Company is then subject to Section 13 or 15(d)
of the Exchange Act.
(i) To use its best efforts to permit the Units, the Notes and the
Warrants to be designated PORTAL securities in accordance with the rules
and regulations adopted by the National Association of Securities Dealers,
Inc. relating to trading in the PORTAL Market, and to list the shares of
the Common Stock issuable upon exercise of the Warrants on the Nasdaq
National Market.
(j) None of the Company, its Affiliates or any person acting on its or
their behalf (other than the Placement Agents) will engage in any directed
selling efforts (as that term is defined in Regulation S) with respect to
the Securities, and the Company and its Affiliates and each person acting
on its or their behalf (other than the Placement Agents) will not engage in
any selling efforts pursuant to Regulation S.
(k) During the period of two years after the Closing Date, the Company
will not, and will not permit any of its affiliates (as defined in Rule 144
under the Securities Act) to resell any of the Securities which constitute
"restricted securities" under Rule 144 that have been reacquired by any of
them.
(l) To deposit up to approximately $267.7 million with the Escrow
Agent in accordance with the terms of the Escrow Agreement prior to or on
the Closing Date.
(m) To reserve and keep available at all times, free of preemptive
rights, shares of the Common Stock for the purpose of enabling the Company
to satisfy any obligations to issue the shares of the Common Stock upon
exercise of the Warrants.
7. Offering of Securities; Restrictions on Transfer. Each Placement
Agent, severally and not jointly, represents and warrants that such Placement
Agent is a qualified institutional buyer as defined in Rule 144A under the
Securities Act (a "QIB"). Each Placement Agent, severally and not jointly,
agrees with the Company that (i) it will not solicit offers for, or offer or
sell, such Securities by any form of general solicitation or general advertising
(as those terms are used in Regulation D under the Securities Act) or in any
manner involving a public
17
offering within the meaning of Section 4(2) of the Securities Act and (ii) it
will solicit offers for such Securities only from, and will offer such
Securities only to, persons that it reasonably believes to be QIBs and that in
purchasing such Securities are deemed to have represented and agreed as provided
in the Final Memorandum under the caption "Transfer Restrictions." In connection
with each sale pursuant to this Section 7, the Placement Agents have each taken
or will take reasonable steps to ensure that the purchaser of such Security is
aware that such sale is being made in reliance on Rule 144A.
8. Indemnity and Contribution. The Company agrees to indemnify and
hold harmless each Placement Agent and each person, if any, who controls any
Placement Agent within the meaning of either Section 15 of the Securities Act or
Section 20 of the Exchange Act from and against any and all losses, claims,
damages and liabilities (including, without limitation, any legal or other
expenses reasonably incurred in connection with defending or investigating any
such action or claim) caused by any untrue statement or alleged untrue statement
of a material fact contained in either Memorandum (as amended or supplemented if
the Company shall have furnished any amendments or supplements thereto), or
caused by any omission or alleged omission to state therein a material fact
necessary to make the statements therein in the light of the circumstances under
which they were made not misleading, except insofar as such losses, claims,
damages or liabilities are caused by any such untrue statement or omission or
alleged untrue statement or omission based upon information relating to any
Placement Agent furnished to the Company in writing by such Placement Agent
through you expressly for use therein; provided however, that the foregoing
indemnity agreement with respect to any Preliminary Memorandum shall not inure
to the benefit of any Placement Agent from whom the person asserting any such
losses, claims, damages or liabilities purchased the Securities, or any person
controlling such Placement Agent, if it is established that a copy of the Final
Memorandum (as then amended or supplemented if the Company shall have furnished
any amendments or supplements thereto) was not sent or given by or on behalf of
such Placement Agent to such person, at or prior to the written confirmation of
the sale of the Securities to such person, and if the Final Memorandum (as so
amended or supplemented) would have cured the defect giving rise to such losses,
claims, damages or liabilities, unless such failure is the result of the
Company's failure to provide such Placement Agent the Final Memorandum at or
prior to the requested delivery of a written confirmation in connection with the
sale of Securities to such person.
(a) Each Placement Agent agrees, severally and not jointly, to
indemnify and hold harmless the Company, its directors, its officers and each
person, if any, who controls the Company within the meaning of either Section 15
of the Securities Act or Section 20 of the Exchange Act to the same extent as
the foregoing indemnity from the Company to such Placement Agent, but only with
reference to information relating to such Placement Agent furnished to the
Company in writing by such Placement Agent through you expressly for use in
either Memorandum or any amendments or supplements thereto.
(b) In case any proceeding (including any governmental investigation)
shall be instituted involving any person in respect of which indemnity may be
sought pursuant to Section 8(a) or 8(b), such person (the "indemnified party")
shall promptly notify the person against
18
whom such indemnity may be sought (the "indemnifying party") in writing and the
indemnifying party, upon request of the indemnified party, shall retain counsel
reasonably satisfactory to the indemnified party to represent the indemnified
party and any others the indemnifying party may designate in such proceeding and
shall pay the fees and disbursements of such counsel related to such proceeding.
In any such proceeding, any indemnified party shall have the right to retain its
own counsel, but the fees and expenses of such counsel shall be at the expense
of such indemnified party unless (i) the indemnifying party and the indemnified
party shall have mutually agreed to the retention of such counsel, (ii) the
named parties to any such proceeding (including any impleaded parties) include
both the indemnifying party and the indemnified party and representation of both
parties by the same counsel would be inappropriate due to actual or potential
differing interests between them, (iii) the indemnifying party shall not have
employed counsel reasonably satisfactory to the indemnified party to represent
the indemnified party within a reasonable time after notice of the institution
or (iv) the indemnifying party shall have authorized the indemnified party to
employ separate counsel at the expense of the indemnifying party. It is
understood that the indemnifying party shall not, in respect of the legal
expenses of any indemnified party in connection with any proceeding or related
proceedings in the same jurisdiction, be liable for the fees and expenses of
more than one separate firm (in addition to any local counsel) for all such
indemnified parties and that all such fees and expenses shall be reimbursed as
they are incurred. Such firm shall be designated in writing by Xxxxxx Xxxxxxx &
Co. Incorporated, in the case of parties indemnified pursuant to Section 8(a),
and by the Company, in the case of parties indemnified pursuant to Section 8(b).
The indemnifying party shall not be liable for any settlement of any proceeding
effected without its written consent, but if settled with such consent or if
there be a final judgment for the plaintiff, the indemnifying party agrees to
indemnify the indemnified party from and against any loss or liability by reason
of such settlement or judgment. No indemnifying party shall, without the prior
written consent of the indemnified party, effect any settlement of any pending
or threatened proceeding in respect of which any indemnified party is or could
have been a party and indemnity could have been sought hereunder by such
indemnified party, unless such settlement includes an unconditional release of
such indemnified party from all liability arising out of such claim, action,
suit or proceeding.
(c) To the extent the indemnification provided for in Section 8(a) or
8(b) is unavailable to an indemnified party or insufficient in respect of any
losses, claims, damages or liabilities referred to therein, then each
indemnifying party under such paragraph, in lieu of indemnifying such
indemnified party thereunder, shall contribute to the amount paid or payable by
such indemnified party as a result of such losses, claims, damages or
liabilities (i) in such proportion as is appropriate to reflect the relative
benefits received by the Company on the one hand and the Placement Agents on the
other hand from the offering of the Securities or (ii) if the allocation
provided by clause 8(d)(i) above is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits referred
to in clause 8(d)(i) above but also the relative fault of the Company on the one
hand and of the Placement Agents on the other hand in connection with the
statements or omissions that resulted in such losses, claims, damages or
liabilities, as well as any other relevant equitable considerations. The
relative benefits received by the Company on the one hand and the Placement
Agents on the other hand in connection with the offering of the Securities shall
be deemed to be in the same respective
19
proportions as the net proceeds from the offering of the Securities (before
deducting expenses) received by the Company and the total discounts and
commissions received by the Placement Agents in respect thereof, bear to the
aggregate offering price of the Securities. The relative fault of the Company on
the one hand and of the Placement Agents on the other hand shall be determined
by reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission or alleged omission to state a
material fact relates to information supplied by the Company or by the Placement
Agents and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The Placement
Agents' respective obligations to contribute pursuant to this Section 8 are
several in proportion to the respective principal amount of Securities they have
purchased hereunder, and not joint.
(d) The Company and the Placement Agents agree that it would not be
just or equitable if contribution pursuant to this Section 8 were determined by
pro rata allocation (even if the Placement Agents were treated as one entity for
such purpose) or by any other method of allocation that does not take account of
the equitable considerations referred to in Section 8(d). The amount paid or
payable by an indemnified party as a result of the losses, claims, damages and
liabilities referred to in Section 8(d) shall be deemed to include, subject to
the limitations set forth above, any legal or other expenses reasonably incurred
by such indemnified party in connection with investigating or defending any such
action or claim. Notwithstanding the provisions of this Section 8, no Placement
Agent shall be required to contribute any amount in excess of the amount by
which the total price at which the Securities resold by it in the initial
placement of such Securities were offered to investors exceeds the amount of any
damages that such Placement Agent has otherwise been required to pay by reason
of such untrue or alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation. The remedies provided
for in this Section 8 are not exclusive and shall not limit any rights or
remedies which may otherwise be available to any indemnified party at law or in
equity.
(e) The indemnity and contribution provisions contained in this
Section 8 and the representations, warranties and other statements of the
Company contained in this Agreement shall remain operative and in full force and
effect regardless of (i) any termination of this Agreement, (ii) any
investigation made by or on behalf of any Placement Agent or any person
controlling any Placement Agent or by or on behalf of the Company, its officers
or directors or any person controlling the Company and (iii) acceptance of and
payment for any of the Securities.
9. Termination. This Agreement shall be subject to termination by
notice given by you to the Company, if (a) after the execution and delivery of
this Agreement and prior to the Closing Date (i) trading generally shall have
been suspended or materially limited on or by, as the case may be, any of the
New York Stock Exchange, the American Stock Exchange, the National Association
of Securities Dealers, Inc. and the Chicago Board of Options Exchange, (ii)
trading of any securities of the Company shall have been suspended on any
exchange or in any over-the-counter market, (iii) a general moratorium on
commercial banking activities in New
20
York shall have been declared by either Federal or New York State authorities or
(iv) there shall have occurred any outbreak or escalation of hostilities or any
change in financial markets or any calamity or crisis that, in your judgment, is
material and adverse and (b) in the case of any of the events specified in
clauses 9(a)(i) through 9(a)(iv), such event, singly or together with any other
such event, makes it, in your judgment, impracticable to market the Securities
on the terms and in the manner contemplated in the Final Memorandum.
10. Effectiveness; Defaulting Placement Agents. This Agreement shall
become effective upon the execution and delivery hereof by the parties hereto.
If, on the Closing Date, any one or more of the Placement Agents shall
fail or refuse to purchase Securities that it or they have agreed to purchase
hereunder on such date, and the aggregate principal amount of Securities which
such defaulting Placement Agent or Placement Agents agreed but failed or refused
to purchase is not more than one-tenth of the aggregate principal amount of
Securities to be purchased on such date, the other Placement Agents shall be
obligated severally in the proportions that the principal amount of Securities
set forth opposite their respective names in Schedule I bears to the aggregate
principal amount of Securities set forth opposite the names of all such non-
defaulting Placement Agents, or in such other proportions as you may specify, to
purchase the Securities which such defaulting Placement Agent or Placement
Agents agreed but failed or refused to purchase on such date; provided that in
no event shall the principal amount of Securities that any Placement Agent has
agreed to purchase pursuant to this Agreement be increased pursuant to this
Section 10 by an amount in excess of one-ninth of such principal amount of
Securities without the written consent of such Placement Agent. If on the
Closing Date any Placement Agent or Placement Agents shall fail or refuse to
purchase Securities which it or they have agreed to purchase hereunder on such
date and the aggregate principal amount of Securities with respect to which such
default occurs is more than one-tenth of the aggregate principal amount of
Securities to be purchased on such date, and arrangements satisfactory to you
and the Company for the purchase of such Securities are not made within 36 hours
after such default, this Agreement shall terminate without liability on the part
of any non-defaulting Placement Agent or of the Company. In any such case
either you or the Company shall have the right to postpone the Closing Date, but
in no event for longer than seven days, in order that the required changes, if
any, in the Final Memorandum or in any other documents or arrangements may be
effected. Any action taken under this paragraph shall not relieve any
defaulting Placement Agent from liability in respect of any default of such
Placement Agent under this Agreement.
If this Agreement shall be terminated by the Placement Agents, or any
of them, because of any failure or refusal on the part of the Company to comply
with the terms or to fulfill any of the conditions of this Agreement, or if for
any reason, other than a termination of this Agreement pursuant to Sections
9(a)(i), 9(a)(iii) and 9(a)(iv) hereof, the Company shall be unable to perform
its obligations under this Agreement, the Company will reimburse the Placement
Agents or such Placement Agents as have so terminated this Agreement with
respect to themselves, severally, for all out-of-pocket expenses (including the
fees and disbursements of their counsel) reasonably incurred by such Placement
Agents in connection with this Agreement or the offering contemplated hereunder.
21
11. Notices. All notices and other communications under this
Agreement shall be in writing and mailed, delivered or sent by facsimile
transmission to: if sent to the Placement Agents, Xxxxxx Xxxxxxx & Co.
Incorporated, 0000 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, attention: High Yield New
Issues Group, facsimile number (000) 000-0000 and if sent to the Company, to 000
Xxxxxx Xxxx, Xxxxx 000, Xxxxxxxxxx, Xxxxxxxx 00000, attention: Chief Financial
Officer, facsimile number (000) 000-0000.
12. Counterparts. This Agreement may be signed in any number of
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.
13. Applicable Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York.
14. Headings. The headings of the sections of this Agreement have
been inserted for convenience of reference only and shall not be deemed a part
of this Agreement.
22
Very truly yours,
CFW COMMUNICATIONS COMPANY
By: ______________________________
Name:
Title:
Accepted as of the date hereof
XXXXXX XXXXXXX & CO. INCORPORATED
FIRST UNION SECURITIES, INC.
SUNTRUST EQUITABLE SECURITIES CORPORATION
Acting severally on behalf of themselves and
the several Placement Agents named in
Schedule I hereto.
By: Xxxxxx Xxxxxxx & Co. Incorporated
By: ____________________________
Name:
Title:
23
