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TELIGENT, L.L.C.
(a Delaware limited liability company)
and
TELIGENT, INC.
(a Delaware corporation)
$250,000,000 ___% Senior Notes due 2007
$___________ ___% Senior Discount Notes due 2007
DEBT PURCHASE AGREEMENT
Dated: November __, 1997
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Table of Contents
PURCHASE AGREEMENT.............................................................................................. 1
SECTION 1. Representations and Warranties.................................................... 3
(a) Representations and Warranties by the L.L.C. and the Issuer....................... 3
(i) Compliance with Registration Requirements..................................... 3
(ii) Independent Accountants................................................. 4
(iii) Financial Statements.................................................... 4
(iv) No Material Adverse Change in Business.................................. 4
(v) Good Standing of the L.L.C.............................................. 5
(vi) Good Standing of the Issuer............................................. 5
(vii) Good Standing of Subsidiaries........................................... 5
(viii) Capitalization of the Company........................................... 6
(ix) Authorization of Agreement.............................................. 6
(x) Authorization and Description of Securities............................. 6
(xi) Absence of Defaults and Conflicts....................................... 6
(xii) Absence of Labor Dispute................................................ 7
(xiii) Absence of Proceedings.................................................. 7
(xiv) Accuracy of Exhibits.................................................... 8
(xv) Possession of Intellectual Property..................................... 8
(xvi) Absence of Further Requirements......................................... 8
(xvii) Possession of Licenses and Permits...................................... 8
(xviii) Title to Property....................................................... 9
(xix) Investment Company Act.................................................. 9
(xx) Environmental Laws...................................................... 9
(xxi) Registration Rights..................................................... 10
(xxii) Transactions............................................................ 10
(xxiii) Insurance Coverage...................................................... 10
(xxiv) Absence of Dividend Restrictions........................................ 11
(xxv) Filings of Tax Returns.................................................. 11
(xxvi) Maintenance of Internal Accounting Controls............................. 11
(b) Officer's Certificates............................................................ 11
SECTION 2. Sale and Delivery to Underwriters; Closing........................................ 11
(a) Securities........................................................................ 11
(b) Payment........................................................................... 12
(c) Denominations; Registration....................................................... 12
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* For high-yield offerings, counsel should also consider the additional
representations for use in high-yield offerings included in Annex B to this
form. The form of opinion of Company's consel should be revised accordingly.
SECTION 3. Covenants of the Company.......................................................... 12
(a) Compliance with Securities Regulations and Commission
Requests....................................................................... 12
(b) Filing of Amendments.............................................................. 13
(c) Delivery of Registration Statements............................................... 13
(d) Delivery of Prospectus............................................................ 13
(e) Continued Compliance with Securities Laws......................................... 13
(f) Rule 158.......................................................................... 14
(g) Use of Proceeds................................................................... 14
(h) Listing........................................................................... 14
[(i) Restriction on Sale of Securities................................................. 14
(j) Reporting Requirements............................................................ 14
SECTION 4. Payment of Expenses............................................................... 15
(a) Expenses.......................................................................... 15
(b) Termination of Agreement.......................................................... 15
SECTION 5. Conditions of Underwriters' Obligations........................................... 15
(a) Effectiveness of Registration Statement........................................... 15
(b) Opinions of Counsel for the L.L.C. and the Issuer................................. 16
(c) Opinion of Counsel for Underwriters............................................... 16
(d) Officers' Certificate............................................................. 16
(e) Accountants' Comfort Letter....................................................... 17
(f) Bring-down Comfort Letter......................................................... 17
(g) Approval of Listing............................................................... 17
(h) No Objection...................................................................... 17
(i) Equity Transaction................................................................ 17
(j) Transactions...................................................................... 18
(k) Additional Documents.............................................................. 18
(l) Termination of Agreement.......................................................... 18
SECTION 6. Indemnification................................................................... 18
(a) Indemnification of Underwriters................................................... 18
(b) Indemnification of Issuer, Directors and Officers................................. 19
(c) Actions Against Parties; Notification............................................. 20
(d) Settlement Without Consent if Failure to Reimburse................................ 20
SECTION 7. Contribution...................................................................... 21
SECTION 8. Representations, Warranties and Agreements to Survive
Delivery....................................................................... 22
SECTION 9. Termination of Agreement.......................................................... 22
(a) Termination; General.............................................................. 22
(b) Liabilities....................................................................... 23
SECTION 10. Default by One or More of the Underwriters........................................ 23
SECTION 11. Notices........................................................................... 24
SECTION 12. Parties........................................................................... 24
SECTION 13. GOVERNING LAW AND TIME............................................................ 24
SECTION 14. Effect of Headings................................................................ 24
ii
SCHEDULES
Schedule A - List of Underwriters
Schedule B-1 - Pricing Information Senior Notes
Schedule B-2 - Pricing Information--Senior Discount Notes
EXHIBITS
Exhibit A - Form of Opinion of Company Counsel
Exhibit B - Form of Opinion of Special Federal Regulatory Counsel
Exhibit C - Form of Opinion of General Counsel for the Company
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TELIGENT, L.L.C.
(a Delaware limited liability company)
and
TELIGENT, INC.
(a Delaware corporation)
$250,000,000 ___% Senior Notes due 2007
$___________ ___% Senior Discount Notes due 2007
PURCHASE AGREEMENT
November __, 1997
XXXXXXX XXXXX & CO.
Xxxxxxx Xxxxx, Xxxxxx, Xxxxxx & Xxxxx
Incorporated
Salomon Brothers Inc
TD Securities (USA) Inc.
Xxxxxxx, Xxxxx & Co.
as Representatives of the several Underwriters
c/x Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
North Tower
World Financial Center
New York, New York 10281
Ladies and Gentlemen:
Teligent, L.L.C., a Delaware limited liability company (the "L.L.C."),
and Teligent, Inc., a Delaware corporation (the "Issuer"; references herein to
the "Company" mean, as of the date hereof, the L.L.C. and, as of the Closing
Time (as defined herein), the Issuer), confirm their agreement with Xxxxxxx
Xxxxx & Co., Xxxxxxx Lynch, Xxxxxx, Xxxxxx & Xxxxx Incorporated ("Xxxxxxx
Xxxxx") and each of the other Underwriters named in Schedule A hereto
(collectively, the "Underwriters", which term shall also include any underwriter
substituted as hereinafter provided in Section 10 hereof), for whom Xxxxxxx
Xxxxx, Xxxxxxx Brothers Inc, TD Securities (USA) Inc. and Xxxxxxx, Xxxxx & Co.
are acting as representatives (in such capacity, the "Representatives"), with
respect to the issue and sale by the Issuer and the purchase by the
Underwriters, acting severally and not jointly, of the respective principal
amounts and principal
2
amounts at maturity set forth in said Schedule A of $250,000,000 aggregate
principal amount of the Issuer's ___% Senior Notes due 2007 (the "Senior Notes")
and $_____ aggregate principal amount at maturity of the Issuer's ___% Senior
Discount Notes due 2007 (the "Senior Discount Notes" and, together with the
Senior Notes, the "Securities"). The Senior Notes are to be issued pursuant to
an indenture dated as of o, 1997 (the "Senior Notes Indenture") between the
Issuer and First Union National Bank, as trustee (the "Trustee"), and the Senior
Discount Notes are to be issued pursuant to an indenture dated as of o, 1997
(the "Senior Discount Notes Indenture") between the Issuer and the Trustee (the
Senior Notes Indenture and the Senior Discount Notes Indenture, collectively,
the "Indentures").
The Company understands that the Underwriters propose to make a public
offering of the Securities as soon as the Representatives deem advisable after
this Agreement has been executed and delivered and the Indentures have been
qualified under the Trust Indenture Act of 1939, as amended (the "1939 Act").
The Issuer has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-1 (No. 333-37373) and o
amendments thereto covering the registration of the Securities under the
Securities Act of 1933, as amended (the "1933 Act"), including the related
preliminary prospectus or prospectuses. Promptly after execution and delivery of
this Agreement, the Issuer will either (i) prepare and file a prospectus in
accordance with the provisions of Rule 430A ("Rule 430A") of the rules and
regulations of the Commission under the 1933 Act (the "1933 Act Regulations")
and paragraph (b) of Rule 424 ("Rule 424(b)") of the 1933 Act Regulations or
(ii) if the Issuer has elected to rely upon Rule 434 ("Rule 434") of the 1933
Act Regulations, prepare and file a term sheet (a "Term Sheet") in accordance
with the provisions of Rule 434 and Rule 424(b). The information included in
such prospectus or in such Term Sheet, as the case may be, that was omitted from
such registration statement at the time it became effective but that is deemed
to be part of such registration statement at the time it became effective (a)
pursuant to paragraph (b) of Rule 430A is referred to as "Rule 430A Information"
or (b) pursuant to paragraph (d) of Rule 434 is referred to as "Rule 434
Information." Each prospectus used before such registration statement became
effective, and any prospectus that omitted, as applicable, the Rule 430A
Information or the Rule 434 Information, that was used after such effectiveness
and prior to the execution and delivery of this Agreement, is herein called a
"preliminary prospectus." Such registration statement, including the exhibits,
schedules and amendments thereto, if any, at the time it became effective and
including the Rule 430A Information and the Rule 434 Information, as applicable,
is herein called the "Registration Statement." Any registration statement filed
pursuant to Rule 462(b) of the 1933 Act Regulations is herein referred to as the
"Rule 462(b) Registration Statement," and after such filing the term
"Registration Statement" shall include the Rule 462(b) Registration Statement.
The final prospectus in the form first furnished to the Underwriters for use in
connection with the confirmation of sales of the Securities is herein called the
"Prospectus." If Rule 434 is relied on, the term "Prospectus" shall refer to the
preliminary prospectus dated October 30, 1997 together with the Term Sheet and
all references in this Agreement to the date
3
of the Prospectus shall mean the date of the Term Sheet. For purposes of this
Agreement, all references to the Registration Statement, any preliminary
prospectus, the Prospectus or any Term Sheet or any amendment or supplement to
any of the foregoing shall be deemed to include the copy filed with the
Commission pursuant to its Electronic Data Gathering, Analysis and Retrieval
system ("XXXXX").
SECTION 1. Representations and Warranties.
(a) Representations and Warranties by the L.L.C. and the Issuer.
Each of the L.L.C. and the Issuer, jointly and severally, represents and
warrants to each Underwriter as of the date hereof, as of the Closing Time
referred to in Section 2(b) hereof, and agrees with each Underwriter, as
follows:
(i) Compliance with Registration Requirements. Each of the
Registration Statement and any Rule 462(b) Registration Statement has
become effective under the 1933 Act and no stop order suspending the
effectiveness of the Registration Statement or any Rule 462(b)
Registration Statement has been issued under the 1933 Act and no
proceedings for that purpose have been instituted or are pending or, to
the knowledge of the L.L.C. or the Issuer, are contemplated by the
Commission, and any request on the part of the Commission for
additional information has been complied with.
At the respective times the Registration Statement, any Rule
462(b) Registration Statement and any post-effective amendments and
supplements thereto became effective and at the Closing Time, the
Registration Statement, the Rule 462(b) Registration Statement and any
post-effective amendments and supplements thereto complied and will
comply in all material respects with the requirements of the 1933 Act
and the 1933 Act Regulations and the 1939 Act and the rules and
regulations of the Commission under the 1939 Act (the "1939 Act
Regulations"), and did not and will not contain an untrue statement of
a material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading.
Neither the Prospectus nor any amendments or supplements thereto
(including any prospectus wrapper), at the time the Prospectus or any
such amendment or supplement were issued and at the Closing Time,
included or will include an untrue statement of a material fact or
omitted or will omit to state a material fact necessary in order to
make the statements therein, in the light of the circumstances under
which they were made, not misleading. If Rule 434 is used, the Company
will comply with the requirements of Rule 434 and the Prospectus shall
not be "materially different", as such term is used in Rule 434, from
the prospectus included in the Registration Statement at the time it
became effective. The representations and warranties in this subsection
shall not apply to statements in or omissions from the Registration
Statement, any Rule 462(b) Registration Statement or any post-effective
amendment thereto or the Prospectus or any amendments or supplements
xxxxxxx made in reliance upon and in conformity with information
furnished to the Company in writing
4
by any Underwriter through the Representatives expressly for use in the
Registration Statement, any Rule 462(b) Registration Statement or any
post-effective amendment thereto or the Prospectus or any amendments or
supplements thereto.
Each preliminary prospectus and the prospectus filed as part
of the Registration Statement as originally filed or as part of any
amendment thereto, or filed pursuant to Rule 424 under the 1933 Act,
complied when so filed in all material respects with the 1933 Act
Regulations and each preliminary prospectus and the Prospectus
delivered to the Underwriters for use in connection with this offering
was identical to the electronically transmitted copies thereof filed
with the Commission pursuant to XXXXX, except to the extent permitted
by Regulation S-T.
(ii) Independent Accountants. The accountants who
certified the financial statements and supporting schedules included
in the Registration Statement are independent public accountants as
required by the 1933 Act and the 1933 Act Regulations.
(iii) Financial Statements. The financial statements included
in the Registration Statement and the Prospectus, together with the
related schedules (if any) and notes, present fairly the financial
position of the L.L.C. at the dates indicated and the statement of
operations, members' deficit and cash flows of the L.L.C. for the
periods specified; said financial statements have been prepared in
conformity with generally accepted accounting principles ("GAAP")
applied on a consistent basis throughout the periods involved. The
supporting schedules (if any) included in the Registration Statement
present fairly in accordance with GAAP the information required to be
stated therein. The selected financial data included in the Prospectus
present fairly the information shown therein and have been compiled on
a basis consistent with that of the audited financial statements
included in the Registration Statement. The pro forma balance sheet and
the related notes thereto included in the Registration Statement and
the Prospectus present fairly the information shown therein, have been
prepared in accordance with the Commission's rules and guidelines with
respect to pro forma financial statements and have been properly
compiled on the bases described therein, and the assumptions used in
the preparation thereof are reasonable and the adjustments used therein
are appropriate to give effect to the transactions and circumstances
referred to therein.
(iv) No Material Adverse Change in Business. Since the
respective dates as of which information is given in the Registration
Statement and the Prospectus, except as otherwise stated therein, (A)
there has been no material adverse change in the condition, financial
or otherwise, or in the earnings, business affairs or business
prospects of the Company and its subsidiaries considered as one
enterprise, whether or not arising in the ordinary course of business
(a "Material Adverse Effect"), (B) there have been no transactions
entered into by the Company or any of its subsidiaries, other than
those in the ordinary course of business, which are material with
respect to the
5
Company and its subsidiaries considered as one enterprise, and (C)
there has been no dividend or distribution of any kind declared, paid
or made by the Company to any of its members or stockholders, as
applicable.
(v) Good Standing of the L.L.C. The L.L.C. has been duly
organized and is validly existing as a limited liability company in
good standing under the laws of the State of Delaware and has limited
liability company power and authority to own, lease and operate its
properties and to conduct its business as described in the Prospectus
and to enter into and perform its obligations under this Agreement; and
the L.L.C. is duly qualified as a foreign limited liability company to
transact business and is in good standing in each other jurisdiction in
which such qualification is required, whether by reason of the
ownership or leasing of property or the conduct of business, except
where the failure so to qualify or to be in good standing would not
result in a Material Adverse Effect.
(vi) Good Standing of the Issuer. The Issuer has been duly
organized and is validly existing as a corporation in good standing
under the laws of the State of Delaware and has corporate power and
authority to own, lease and operate its properties and to conduct its
business as described in the Prospectus and to enter into and perform
its obligations under this Agreement; and the Issuer is duly qualified
as a foreign corporation to transact business and is in good standing
in each other jurisdiction in which such qualification is required,
whether by reason of the ownership or leasing of property or the
conduct of business, except where the failure so to qualify or to be in
good standing would not result in a Material Adverse Effect.
(vii) Good Standing of Subsidiaries. Each "significant
subsidiary" of the Company (as such term is defined in Rule 1-02 of
Regulation S-X) (each a "Subsidiary" and, collectively, the
"Subsidiaries") has been duly organized and is validly existing as a
corporation or limited liability company (as applicable) in good
standing under the laws of the jurisdiction of its organization, has
corporate or limited liability company (as applicable) power and
authority to own, lease and operate its properties and to conduct its
business as described in the Prospectus and is duly qualified as a
foreign corporation or limited liability company (as applicable) to
transact business and is in good standing in each jurisdiction in which
such qualification is required, whether by reason of the ownership or
leasing of property or the conduct of business, except where the
failure so to qualify or to be in good standing would not result in a
Material Adverse Effect; except as otherwise disclosed in the
Registration Statement, all of the issued and outstanding capital stock
or members' interests (as applicable) of each such Subsidiary has been
duly authorized and validly issued, and, in the case of Subsidiaries
that are corporations, is fully paid and non-assessable, and is owned
by the Company, directly or through subsidiaries, free and clear of any
security interest, mortgage, pledge, lien, encumbrance, claim or equity
(except for any pledge thereof securing the Revolving Credit Agreement
(as defined in the Registration Statement)); none of the outstanding
shares of capital stock
6
or members' interests (as applicable) of any Subsidiary was issued in
violation of the preemptive or similar rights of any securityholder or
member (as applicable) of such Subsidiary. The only subsidiaries of the
Company are the subsidiaries listed on Schedule D to this Agreement.
(viii) Capitalization of the L.L.C.. The capitalization of the
L.L.C. is as set forth in the Prospectus in the column entitled
"Actual" under the caption "Prospectus Summary--Pro Forma
Capitalization" (except for the repayment in full since September 30,
1997 of all outstanding amounts under the Revolving Credit Agreement).
The shares of issued and outstanding capital stock of the Issuer have
been duly authorized and validly issued and are fully paid and
non-assessable; none of the outstanding shares of capital stock of the
Issuer was issued in violation of the preemptive or other similar
rights of any member or securityholder of the L.L.C. or the Issuer.
(ix) Authorization of Agreement. This Agreement has been
duly authorized, executed and delivered by each of the L.L.C. and the
Issuer.
(x) Authorization and Description of Securities. The
Securities to be purchased by the Underwriters from the Issuer have
been duly authorized for issuance and sale to the Underwriters pursuant
to this Agreement and, when issued and delivered by the Issuer pursuant
to this Agreement against payment of the consideration set forth
herein, will be validly issued, fully paid and non-assessable; the
Securities conform to all statements relating thereto contained in the
Prospectus and such description conforms to the rights set forth in the
instruments defining the same; no holder of the Securities is or will
be subject to personal liability by reason of being such a holder; and
the issuance of the Securities is not subject to the preemptive or
other similar rights of any member or securityholder of the L.L.C. or
the Issuer.
(xi) Absence of Defaults and Conflicts. Neither the L.L.C.,
the Issuer nor any of their respective subsidiaries is in violation of
its organizational documents (in the case of a limited liability
company) or charter or by-laws (in the case of a corporation), or in
default in the performance or observance of any obligation, agreement,
covenant or condition contained in any contract, indenture, mortgage,
deed of trust, loan or credit agreement, note, lease or other agreement
or instrument to which either the L.L.C., the Issuer or any of their
respective subsidiaries is a party or by which it or any of them may be
bound, or to which any of the property or assets of either the L.L.C.,
the Issuer or any of their respective subsidiaries is subject
(collectively, the "Agreements and Instruments") except for such
violations or defaults that would not result in a Material Adverse
Effect; and the execution, delivery and performance of this Agreement
and the consummation of the transactions contemplated in this Agreement
and in the Registration Statement (including the consummation of the
Reorganization, the Additional Sponsor Equity Contributions and the
Strategic Equity Investment, each as defined in the
7
Registration Statement (collectively, the "Transactions"), the issuance
and sale of the Securities and the use of the proceeds from the sale of
the Securities as described in the Prospectus under the caption "Use of
Proceeds") and compliance by each of the L.L.C. and the Issuer with
their respective obligations under this Agreement, and the agreements
pursuant to which the Transactions will be consummated have been duly
authorized by all necessary limited liability company or corporate
action (as applicable) and do not and will not, whether with or without
the giving of notice or passage of time or both, conflict with or
constitute a breach of, or default or Repayment Event (as defined
below) under, or result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of either the L.L.C.,
the Issuer or any of their respective subsidiaries pursuant to, the
Agreements and Instruments (except for such conflicts, breaches or
defaults or liens, charges or encumbrances that would not result in a
Material Adverse Effect), nor will such action result in any violation
of the provisions of the organizational documents (in the case of a
limited liability company) or charter or by-laws (in the case of a
corporation) of either the L.L.C., the Issuer or any of their
respective subsidiaries or (except for such violations that would not
result in a Material Adverse Effect) any applicable law, statute, rule,
regulation, judgment, order, writ or decree of any government,
government instrumentality or court, domestic or foreign, having
jurisdiction over either the L.L.C., the Issuer or any of their
respective subsidiaries or any of their respective assets, properties
or operations. As used herein, a "Repayment Event" means any event or
condition which gives the holder of any note, debenture or other
evidence of indebtedness (or any person acting on such holder's behalf)
the right to require the repurchase, redemption or repayment of all or
a portion of such indebtedness by either the L.L.C., the Issuer or any
of their respective subsidiaries.
(xii) Absence of Labor Dispute. No labor dispute with the
employees of the Company or any of its subsidiaries exists or, to the
knowledge of the Company, is imminent which, in any case under this
clause (xii), could reasonably be expected to result in a Material
Adverse Effect.
(xiii) Absence of Proceedings. Except as set forth in the
Prospectus, there is no action, suit, proceeding, inquiry or
investigation before or brought by any court or governmental agency or
body, domestic or foreign, now pending, or, to the knowledge of the
Company, threatened, against or affecting the Company or any of its
subsidiaries, or to which the property of the Company or any of its
subsidiaries is subject, which is required to be disclosed in the
Registration Statement (other than as disclosed therein), or which
could reasonably be expected to result in a Material Adverse Effect, or
which could reasonably be expected to materially and adversely affect
the properties or assets thereof or the consummation of the
transactions contemplated in this Agreement or the performance by the
L.L.C. and the Issuer of their respective obligations hereunder or the
consummation of any of the transactions contemplated pursuant to the
Transactions; the aggregate of all pending legal or governmental
proceedings to which the Company or any
8
of its subsidiaries is a party or of which any of their respective
property or assets is the subject which are not described in the
Registration Statement, including ordinary routine litigation
incidental to the business, could not reasonably be expected to result
in a Material Adverse Effect.
(xiv) Accuracy of Exhibits. There are no contracts or
documents which are required to be described in the Registration
Statement or the Prospectus or to be filed as exhibits thereto which
have not been so described and filed as required.
(xv) Possession of Intellectual Property. The Company and its
subsidiaries own or possess, 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, and neither the Company
nor 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 or of any facts or
circumstances which would render any Intellectual Property invalid or
inadequate to protect the respective interests of the Company or any of
its subsidiaries therein, and which infringement or conflict (if the
subject of any unfavorable decision, ruling or finding) or invalidity
or inadequacy, singly or in the aggregate, would result in a Material
Adverse Effect.
(xvi) Absence of Further Requirements. Except as described in
the Prospectus, no filing with, or authorization, approval, consent,
license, order, registration, qualification or decree of, any court or
governmental authority or agency, domestic or foreign, is necessary or
required for the performance by the L.L.C. or the Issuer of their
respective obligations hereunder, in connection with the offering,
issuance or sale of the Securities under this Agreement or the
consummation of the transactions contemplated by this Agreement or the
consummation of any of the transactions contemplated pursuant to the
Transactions, except such as have been already obtained or as may be
required under the 1933 Act or the 1933 Act Regulations or state
securities or blue sky laws or the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated thereunder or the
laws and regulations promulgated thereunder and except for the
qualification of the Indenture under the 1939 Act.
(xvii) Possession of Licenses and Permits. Except as set forth
in the Prospectus, the Company and its subsidiaries possess such
permits, licenses, approvals, consents and other authorizations
(collectively, "Governmental Licenses") issued by the appropriate
federal, state, local or foreign regulatory agencies or bodies
necessary to conduct the business now operated by them; each of the
Company and its subsidiaries are in compliance with the terms and
conditions of all such Governmental Licenses, except
9
where the failure so to comply would not, singly or in the aggregate,
have a Material Adverse Effect; all of the Governmental Licenses are
valid and in full force and effect, except when the invalidity of such
Governmental Licenses or the failure of such Governmental Licenses to
be in full force and effect would not have a Material Adverse Effect;
and neither the Company nor any of its subsidiaries has received any
notice of proceedings relating to the revocation or modification of any
such Governmental Licenses which, singly or in the aggregate, if the
subject of an unfavorable decision, ruling or finding, would result in
a Material Adverse Effect.
(xviii) Title to Property. The Company and its subsidiaries
have good and marketable title to all real property owned by them and
good title to all other properties owned by them, in each case, free
and clear of all mortgages, pledges, liens, security interests, claims,
restrictions or encumbrances of any kind except such as (a) are
described in the Prospectus or (b) do not, singly or in the aggregate,
materially affect the value of such property and do not interfere with
the use made and proposed to be made of such property by the Company or
any of its subsidiaries; 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
holds properties described in the Prospectus, are in full force and
effect, and neither the Company nor 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 such subsidiary to the
continued possession of the leased or subleased premises under any such
lease or sublease.
(xix) Investment Company Act. The Company is not and, upon the
issuance and sale of the Securities as herein contemplated and the
application of the net proceeds therefrom as described in the
Prospectus will not be, an "investment company" or an entity
"controlled" by an "investment company" as such terms are defined in
the Investment Company Act of 1940, as amended (the "1940 Act").
(xx) Environmental Laws. Except as described in the
Registration Statement and except as would not, singly or in the
aggregate, result in a Material Adverse Effect, (A) neither the Company
nor any of its subsidiaries is in violation of any federal, state,
local or foreign statute, law, rule, regulation, ordinance, code,
policy or rule of common law or any judicial or administrative
interpretation thereof, including any judicial or administrative order,
consent, decree or judgment, relating to pollution or protection of
human health, the environment (including, without limitation, ambient
air, surface water, groundwater, land surface or subsurface strata) or
wildlife, including, without limitation, laws and regulations relating
to the release or threatened release of chemicals, pollutants,
contaminants, wastes, toxic substances, hazardous substances, petroleum
or petroleum products (collectively, "Hazardous Materials") or to the
manufacture, processing,
10
distribution, use, treatment, storage, disposal, transport or handling
of Hazardous Materials (collectively, "Environmental Laws"), (B) the
Company and its subsidiaries have all permits, authorizations and
approvals required under any applicable Environmental Laws and are each
in compliance with their requirements, (C) there are no pending or
threatened administrative, regulatory or judicial actions, suits,
demands, demand letters, claims, liens, notices of noncompliance or
violation, investigation or proceedings relating to any Environmental
Law against the Company or any of its subsidiaries and (D) there are no
events or circumstances that might reasonably be expected to form the
basis of an order for clean-up or remediation, or an action, suit or
proceeding by any private party or governmental body or agency, against
or affecting the Company or any of its subsidiaries relating to
Hazardous Materials or any Environmental Laws.
(xxi) Registration Rights. Except as described in the
Prospectus, there are no persons with registration rights or other
similar rights to have any securities registered pursuant to the
Registration Statement or otherwise registered by the Issuer under the
1933 Act.
(xxii) Transactions. The agreements entered into by the
L.L.C. and the Issuer for the purposes of completing the Transactions
are all in full force and effect with respect to the L.L.C. and the
Issuer and, to the knowledge of the L.L.C. and the Issuer, with
respect to the other parties thereto; and the representations and
warranties of the L.L.C. and the Issuer set forth in such agreements
are true and correct as of the date hereof and as of the respective
dates of such agreements. The L.L.C. and the Issuer have obtained
all contractual consents and approvals necessary to consummate the
Transactions. Except as described in the Prospectus, all
transactions contemplated as part of the Transactions will be
consummated prior to or simultaneously with the Closing Time.
(xxiii) Insurance Coverage. The Company and each of its
subsidiaries are insured by insurers of recognized financial
responsibility against such losses and risks and in such amounts as are
prudent and customary in the businesses in which they are engaged;
neither the Company nor any of its subsidiaries has been refused any
insurance coverage sought or applied for; and neither the Company nor
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 materially
and adversely affect the condition (financial or otherwise), business
prospects, net worth or results of operations of the Company and its
subsidiaries as one enterprise, except as described in or contemplated
by the Prospectus.
11
(xxiv) Absence of Dividend Restrictions. No subsidiary of
the L.L.C. or the Issuer, respectively, is currently prohibited,
directly or indirectly, from paying any dividends to the L.L.C. or
the Issuer, as the case may be, from making any other distribution on
such subsidiary's capital stock, from repaying to the L.L.C. or the
Issuer, as the case may be, any loans or advances to such subsidiary
from the Issuer or from transferring any of such subsidiary's
property or assets to the L.L.C. or the Issuer, as the case may be,
or any other subsidiary of the L.L.C. or the Issuer, as the case may
be, except as described in or contemplated by the Prospectus.
(xxv) Filings of Tax Returns. The Company has filed all
foreign, federal, state and local tax returns that are required to be
filed or has requested extensions thereof and has paid all material
taxes required to be paid by it and any other assessment, fine or
penalty levied against it, to the extent that any of the foregoing is
due and payable, except for any such tax, assessment, fine or penalty
that is currently being contested in good faith or as described in or
contemplated by the Prospectus.
(xxvi) Maintenance of Internal Accounting Controls. The
Company and each of its subsidiaries 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 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 and appropriate intervals and appropriate action is taken
with respect to any differences.
(b) Officer's Certificates. Any certificate signed by any
officer of the Issuer or any of its subsidiaries delivered to the
Representatives or to counsel for the Underwriters shall be deemed a
representation and warranty by the Issuer to each Underwriter as to the matters
covered thereby.
SECTION 2. Sale and Delivery to Underwriters; Closing.
(a) Securities. On the basis of the representations and warranties
herein contained and subject to the terms and conditions herein set forth, the
Issuer agrees to sell to each Underwriter, severally and not jointly, and each
Underwriter, severally and not jointly, agrees to purchase from the Company, at
the price set forth in Schedule B, the respective aggregate principal amount of
Senior Notes and aggregate principal amount at maturity of Senior Discount Notes
set forth in Schedule A opposite the name of such Underwriter, plus any
additional principal amount or principal amount at maturity of Securities which
such Underwriter may become obligated to purchase pursuant to the provisions of
Section 10 hereof.
12
(b) Payment. Payment of the purchase price for, and delivery of
certificates for, the Securities shall be made at the offices of Skadden, Arps,
Slate, Xxxxxxx & Xxxx, LLP, 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, or at
such other place as shall be agreed upon by the Representatives and the Company,
at [10:00 A.M.] (Eastern time) on the third (fourth, if the pricing occurs after
4:30 P.M. (Eastern time) on any given day) business day after the date hereof
(unless postponed in accordance with the provisions of Section 10), or such
other time not later than ten business days after such date as shall be agreed
upon by the Representatives and the Issuer (such time and date of payment and
delivery being herein called "Closing Time").
Payment shall be made to the Issuer by wire transfer of immediately
available funds to a bank account designated by the Issuer, against delivery to
the Representatives for the respective accounts of the Underwriters of
certificates for the Securities to be purchased by them. It is understood that
each Underwriter has authorized the Representatives, for its account, to accept
delivery of, receipt for, and make payment of the purchase price for, the
Securities which it has agreed to purchase. Xxxxxxx Xxxxx, individually and not
as representative of the Underwriters, may (but shall not be obligated to) make
payment of the purchase price for the Securities to be purchased by any
Underwriter whose funds have not been received by the Closing Time, but such
payment shall not relieve such Underwriter from its obligations hereunder.
(c) Denominations; Registration. Certificates for the Securities shall
be in such denominations ($1,000 or integral multiples thereof) and registered
in such names as the Representatives may request in writing at least one full
business day before the Closing Time. The Securities will be made available for
examination and packaging by the Representatives in The City of New York not
later than 10:00 A.M. (Eastern time) on the business day prior to the Closing
Time.
SECTION 3. Covenants of the Issuer. The Issuer covenants with
each Underwriter as follows:
(a) Compliance with Securities Regulations and Commission
Requests. The Issuer, subject to Section 3(b), will comply with the
requirements of Rule 430A or Rule 434, as applicable, and will notify
the Representatives immediately, and confirm the notice in writing, (i)
when any post-effective amendment to the Registration Statement shall
become effective, or any supplement to the Prospectus or any amended
Prospectus shall have been filed, (ii) of the receipt of any comments
from the Commission, (iii) of any request by the Commission for any
amendment to the Registration Statement or any amendment or supplement
to the Prospectus or for additional information, and (iv) of the
issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or of any order preventing
or suspending the use of any preliminary prospectus, or of the
initiation or threatening of any proceedings for any of such purposes.
The Issuer will promptly effect the filings
13
necessary pursuant to Rule 424(b) and will take such steps as it deems
necessary to ascertain promptly whether the form of prospectus
transmitted for filing under Rule 424(b) was received for filing by the
Commission and, in the event that it was not, it will promptly file
such prospectus. The Issuer will make every reasonable effort to
prevent the issuance of any stop order and, if any stop order is
issued, to obtain the lifting thereof at the earliest possible moment.
(b) Filing of Amendments. The Issuer will give the
Representatives notice of its intention to file or prepare any
amendment to the Registration Statement (including any filing under
Rule 462(b)), any Term Sheet or any amendment, supplement or revision
to either the prospectus included in the Registration Statement at the
time it became effective or to the Prospectus, will furnish the
Representatives with copies of any such documents a reasonable amount
of time prior to such proposed filing or use, as the case may be, and
will not file or use any such document to which the Representatives or
counsel for the Underwriters shall object.
(c) Delivery of Registration Statements. The Issuer has
furnished or will deliver to the Representatives and counsel for the
Underwriters, without charge, signed copies of the Registration
Statement as originally filed and of each amendment thereto (including
exhibits filed therewith or incorporated by reference therein) and
signed copies of all consents and certificates of experts, and will
also deliver to the Representatives, without charge, a conformed copy
of the Registration Statement as originally filed and of each amendment
thereto (without exhibits) for each of the Underwriters. The copies of
the Registration Statement and each amendment thereto furnished to the
Underwriters will be identical to the electronically transmitted copies
thereof filed with the Commission pursuant to XXXXX, except to the
extent permitted by Regulation S-T.
(d) Delivery of Prospectus. The Issuer has delivered to each
Underwriter, without charge, as many copies of each preliminary
prospectus as such Underwriter reasonably requested, and the Issuer
hereby consents to the use of such copies for purposes permitted by the
1933 Act. The Issuer will furnish to each Underwriter, without charge,
during the period when the Prospectus is required to be delivered under
the 1933 Act or the Securities Exchange Act of 1934 (the "1934 Act"),
such number of copies of the Prospectus (as amended or supplemented) as
such Underwriter may reasonably request. The Prospectus and any
amendments or supplements thereto furnished to the Underwriters will be
identical to the electronically transmitted copies thereof filed with
the Commission pursuant to XXXXX, except to the extent permitted by
Regulation S-T.
(e) Continued Compliance with Securities Laws. The
Issuer will comply with the 1933 Act and the 1933 Act Regulations and
the 1939 Act and the 1939 Act Regulations so as to permit the
completion of the distribution of the Securities as
14
contemplated in this Agreement and in the Prospectus. If at any time
when a prospectus is required by the 1933 Act to be delivered in
connection with sales of the Securities, any event shall occur or
condition shall exist as a result of which it is necessary, in the
opinion of counsel for the Underwriters or for the Issuer, to amend the
Registration Statement or amend or supplement the Prospectus in order
that the Prospectus will not include any untrue statements of a
material fact or omit to state a material fact necessary in order to
make the statements therein not misleading in the light of the
circumstances existing at the time it is delivered to a purchaser, or
if it shall be necessary, in the opinion of such counsel, at any such
time to amend the Registration Statement or amend or supplement the
Prospectus in order to comply with the requirements of the 1933 Act or
the 1933 Act Regulations, the Issuer will promptly prepare and file
with the Commission, subject to Section 3(b), such amendment or
supplement as may be necessary to correct such statement or omission or
to make the Registration Statement or the Prospectus comply with such
requirements, and the Issuer will furnish to the Underwriters such
number of copies of such amendment or supplement as the Underwriters
may reasonably request.
(f) Rule 158. The Issuer will timely file such reports
pursuant to the 1934 Act as are necessary in order to make generally
available to its securityholders as soon as practicable an earnings
statement for the purposes of, and to provide the benefits contemplated
by, the last paragraph of Section 11(a) of the 1933 Act.
(g) Use of Proceeds. The Issuer will use the net
proceeds received by it from the sale of the Securities in the manner
specified in the Prospectus under "Use of Proceeds".
(h) Listing. The Issuer will use its best efforts to effect
and maintain the quotation of the Securities on the Nasdaq National
Market and will file with the Nasdaq National Market all documents and
notices required by the Nasdaq National Market of companies that have
securities that are traded in the over-the-counter market and
quotations for which are reported by the Nasdaq National Market.
(i) Restriction on Sale of Securities. During a period of
[180] days from the date of the Prospectus, the Issuer will not,
without the prior written consent of Xxxxxxx Xxxxx, directly or
indirectly, issue, sell, offer or contract to sell, sell any option or
contract to purchase, purchase any option or contract to sell, grant
any right or warrant to purchase, or otherwise transfer or dispose of,
any debt securities of the Company.
(j) Reporting Requirements. The Issuer, during the
period when the Prospectus is required to be delivered under the 1933
Act or the 1934 Act, will file all documents required to be filed
with the Commission pursuant to the 1934 Act within the
15
time periods required by the 1934 Act and the rules and regulations
of the Commission thereunder.
SECTION 4. Payment of Expenses.
(a) Expenses. Each of the L.L.C. and the Issuer agrees,
jointly and severally, to pay all expenses incident to the performance of their
respective obligations under this Agreement, including (i) the preparation,
printing and filing of the Registration Statement (including financial
statements and exhibits) as originally filed and of each amendment thereto, (ii)
the preparation, printing and delivery to the Underwriters of this Agreement,
any Agreement among Underwriters, the Indenture and such other documents as may
be required in connection with the offering, purchase, sale, issuance or
delivery of the Securities, (iii) the preparation, issuance and delivery of the
certificates for the Securities to the Underwriters, including any transfer
taxes and any stamp or other duties payable upon the sale, issuance or delivery
of the Securities to the Underwriters, (iv) the fees and disbursements of
counsel, accountants and other advisors for the L.L.C. and the Issuer, (v) the
reasonable fees and disbursements of counsel for the Underwriters in connection
with the preparation of any Blue Sky Survey and any supplement thereto, (vi) the
printing and delivery to the Underwriters of copies of each preliminary
prospectus, any Term Sheets and of the Prospectus and any amendments or
supplements thereto, (vii) the preparation, printing and delivery to the
Underwriters of copies of any Blue Sky Survey and any supplement thereto, (viii)
the fees and expenses of the Trustee, including the fees and disbursements of
counsel for the Trustee in connection with the Indenture and the Securities,
(ix) any fees payable in connection with the rating of the Securities and (x)
the filing fees incident to, and the reasonable fees and disbursements of
counsel to the Underwriters in connection with, the review by the National
Association of Securities Dealers, Inc. (the "NASD") of the terms of the sale of
the Securities.
(b) Termination of Agreement. If this Agreement is terminated by the
Representatives in accordance with the provisions of Section 5 or Section
9(a)(i) hereof, the L.L.C. and the Issuer shall reimburse the Underwriters for
all of their out-of-pocket expenses, including the reasonable fees and
disbursements of counsel for the Underwriters.
SECTION 5. Conditions of Underwriters' Obligations. The obligations of
the several Underwriters hereunder are subject to the accuracy of the
representations and warranties of each of the L.L.C. and the Issuer contained in
Section 1(a) hereof or in certificates of any officer of the Issuer or any
subsidiary of the Issuer delivered pursuant to the provisions hereof, to the
performance by the Issuer of its covenants and other obligations hereunder, and
to the following further conditions:
(a) Effectiveness of Registration Statement. The
Registration Statement, including any Rule 462(b) Registration
Statement, has become effective and at Closing Time no stop order
suspending the effectiveness of the Registration Statement shall have
16
been issued under the 1933 Act or proceedings therefor initiated or
threatened by the Commission, and any request on the part of the
Commission for additional information shall have been complied with to
the reasonable satisfaction of counsel to the Underwriters. A
prospectus containing the Rule 430A Information shall have been filed
with the Commission in accordance with Rule 424(b) (or a post-effective
amendment providing such information shall have been filed and declared
effective in accordance with the requirements of Rule 430A) or, if the
Issuer has elected to rely upon Rule 434, a Term Sheet shall have been
filed with the Commission in accordance with Rule 424(b).
(b) Opinions of Counsel for the L.L.C. and the Issuer. At
Closing Time, the Representatives shall have received the favorable
opinion, dated as of Closing Time, of (i) Xxxxxxx, Arps, Slate, Xxxxxxx
& Xxxx LLP, counsel for the L.L.C. and the Issuer, to the effect set
forth in Exhibit A hereto and to such further effect as counsel to the
Underwriters may reasonably request, (ii) Skadden, Arps, Slate, Xxxxxxx
& Xxxx LLP, special federal regulatory counsel for the L.L.C. and the
Issuer, to the effect set forth in Exhibit B hereto and to such further
effect as counsel to the Underwriters may reasonably request and (iii)
Xxxxxxxx X. Xxxxxx, Esq., General Counsel for the L.L.C. and the
Issuer, to the effect set forth in Exhibit C hereto and to such further
effect as counsel to the Underwriters may reasonably request; each in
form and substance satisfactory to counsel for the Underwriters,
together with signed or reproduced copies of such letter for each of
the other Underwriters. Such counsel may state that, insofar as such
opinions involve factual matters, they have relied, to the extent they
deem proper, upon certificates of officers of the L.L.C. and the Issuer
and their respective subsidiaries and certificates of public officials.
(c) Opinion of Counsel for Underwriters. At Closing Time, the
Representatives shall have received the favorable opinion, dated as of
Closing Time, of Xxxxxxxx & Xxxxxxxx, counsel for the Underwriters,
together with signed or reproduced copies of such letter for each of
the other Underwriters with respect to the matters set forth in
[clauses (i), (ii), (v), (vi) (solely as to preemptive or other similar
rights arising by operation of law or under the organizational
documents, charter or by-laws, as the case may be, of the L.L.C. and
the Issuer), (viii) through (x), inclusive, (xii), (xiv) (solely as to
the information in the Prospectus under "Description of Capital
Stock--Common Stock") and the penultimate paragraph] of Exhibit A
hereto. In giving such opinion, such counsel may rely, as to all
matters governed by the laws of jurisdictions other than the law of the
State of New York, the federal law of the United States and the General
Corporation Law of the State of Delaware, upon the opinions of counsel
satisfactory to the Representatives. Such counsel may also state that,
insofar as such opinion involves factual matters, they have relied, to
the extent they deem proper, upon certificates of officers of the
L.L.C. and the Issuer and their respective subsidiaries and
certificates of public officials.
17
(d) Officers' Certificate. At Closing Time, there shall not
have been, since the date hereof or since the respective dates as of
which information is given in the Prospectus, any material adverse
change in the condition, financial or otherwise, or in the earnings,
business affairs or business prospects of the Company and its
subsidiaries considered as one enterprise, whether or not arising in
the ordinary course of business, and the Representatives shall have
received a certificate of the President or a Vice President of the
Company and of the chief financial or chief accounting officer of the
Company, dated as of Closing Time, to the effect that (i) there has
been no such material adverse change, (ii) the representations and
warranties in Section 1(a) hereof are true and correct with the same
force and effect as though expressly made at and as of Closing Time
(except to the extent that such representations and warranties relate
to an earlier date), (iii) the Company has complied with all agreements
and satisfied all conditions on its part to be performed or satisfied
at or prior to Closing Time, and (iv) no stop order suspending the
effectiveness of the Registration Statement has been issued and no
proceedings for that purpose have been instituted or are pending or are
contemplated by the Commission.
(e) Accountants' Comfort Letter. At the time of the execution
of this Agreement, the Representatives shall have received from Ernst &
Young LLP a letter dated such date, in form and substance satisfactory
to the Representatives, together with signed or reproduced copies of
such letter for each of the other Underwriters 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
Registration Statement and the Prospectus.
(f) Bring-down Comfort Letter. At Closing Time, the
Representatives shall have received from Ernst & Young LLP a letter,
dated as of Closing Time, to the effect that they reaffirm the
statements made in the letter furnished pursuant to subsection (e) of
this Section, except that the specified date referred to shall be a
date not more than three business days prior to Closing Time.
(g) Approval of Listing. At Closing Time, the Securities shall
have been approved for inclusion in the Nasdaq National Market, subject
only to official notice of issuance.
(h) No Objection. The NASD has confirmed that it has not
raised any objection with respect to the fairness and reasonableness
of the underwriting terms and arrangements.
(i) Equity Transaction. The transactions contemplated by
the U.S. Purchase Agreement, dated of even date herewith, among the
Representatives and the Issuer and the L.L.C. shall have occurred
contemporaneously with the transactions contemplated herein.
18
(j) Transactions. At the Closing Time, (i) the Transactions
(other than the Second Closing (as defined in the Prospectus)) shall
have been consummated in full, (ii) the agreements entered into by the
L.L.C. and the Issuer for the purposes of completing the Second Closing
shall be in full force and effect with respect to the L.L.C. and the
Issuer and, to the knowledge of the L.L.C. and the Issuer, with respect
to the other parties thereto, the representations and warranties of the
L.L.C. and the Issuer set forth in such agreements shall be true and
correct and prior to, or simultaneously with, the Closing Time, and
(iii) the L.L.C. and the Issuer shall have provided to the
Representatives and counsel for the Underwriters copies of all closing
documents delivered to the parties to the Transactions (other than with
respect to the Second Closing).
(k) Additional Documents. At Closing Time, counsel for the
Underwriters shall have been furnished with such documents and opinions
as they may require for the purpose of enabling them to pass upon the
issuance and sale of the Securities as herein contemplated, or in order
to evidence the accuracy of any of the representations or warranties,
or the fulfillment of any of the conditions, herein contained; and all
proceedings taken by the Issuer in connection with the issuance and
sale of the Securities as herein contemplated shall be satisfactory in
form and substance to the Representatives and counsel for the
Underwriters.
(l) Termination of Agreement. If any condition specified in
this Section shall not have been fulfilled when and as required to be
fulfilled, this Agreement may be terminated by the Representatives by
written notice to the Issuer on behalf of the L.L.C. and the Issuer, as
applicable, at any time at or prior to Closing Time, and such
termination shall be without liability of any party to any other party
except as provided in Section 4 and except that Sections 1, 6, 7 and 8
shall survive any such termination and remain in full force and effect.
SECTION 6. Indemnification.
(a) Indemnification of Underwriters. Each of the L.L.C. and the Issuer
agrees, jointly and severally, to indemnify and hold harmless each Underwriter
and each person, if any, who controls any Underwriter within the meaning of
Section 15 of the 1933 Act or Section 20 of the 1934 Act as follows:
(i) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of any untrue statement or
alleged untrue statement of a material fact contained in the
Registration Statement (or any amendment thereto), including the Rule
430A Information and any Rule 434 Information, if applicable, or the
omission or alleged omission therefrom of a material fact required to
be stated therein or necessary to make the statements therein not
misleading or arising out of any untrue statement or
19
alleged untrue statement of a material fact included in any preliminary
prospectus or the Prospectus (or any amendment or supplement thereto),
or the omission or alleged omission therefrom of a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading;
(ii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate amount
paid in settlement of any litigation, or any investigation or
proceeding by any governmental agency or body, commenced or threatened,
or of any claim whatsoever based upon any such untrue statement or
omission, or any such alleged untrue statement or omission; provided
that (subject to Section 6(d) below) any such settlement is effected
with the written consent of the Company; and
(iii) against any and all expense whatsoever, as incurred
(including the fees and disbursements of counsel chosen by Xxxxxxx
Xxxxx), reasonably incurred in investigating, preparing or defending
against any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim
whatsoever based upon any such untrue statement or omission, or any
such alleged untrue statement or omission, to the extent that any such
expense is not paid under (i) or (ii) above;
provided, however, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Issuer by any
Underwriter through the Representatives expressly for use in the Registration
Statement (or any amendment thereto), including the Rule 430A Information and
any Rule 434 Information, if applicable, or any preliminary prospectus or the
Prospectus (or any amendment or supplement thereto).
The foregoing indemnity agreement with respect to any preliminary
prospectus shall not inure to the benefit of any Underwriter from whom the
person asserting any such loss, liability, claim, damage or expense purchased
Securities (or any director, officer or employee of such Underwriter, or any
person who controls such Underwriter within the meaning of Section 15 of the
1933 Act or Section 20 of the 1934 Act) if a copy of the applicable Prospectus
(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
Underwriter to such person, if such is required by law, at or prior to the
written confirmation of the sale of such Securities to such person and if such
Prospectus (as so amended or supplemented) would have cured the defect giving
rise to such loss, liability, claim, damage or expense.
(b) Indemnification of Issuer, Directors and Officers. Each
Underwriter severally agrees to indemnify and hold harmless the Issuer, its
directors, each of its officers who signed the Registration Statement, and each
person, if any, who controls the Issuer within the meaning
20
of Section 15 of the 1933 Act or Section 20 of the 1934 Act against any and all
loss, liability, claim, damage and expense described in the indemnity contained
in subsection (a) of this Section, as incurred, but only with respect to untrue
statements or omissions, or alleged untrue statements or omissions, made in the
Registration Statement (or any amendment thereto), including the Rule 430A
Information and any Rule 434 Information, if applicable, or any preliminary
prospectus or the Prospectus (or any amendment or supplement thereto) in
reliance upon and in conformity with written information furnished to the Issuer
by such Underwriter through Xxxxxxx Xxxxx expressly for use in the Registration
Statement (or any amendment thereto) or such preliminary prospectus or the
Prospectus (or any amendment or supplement thereto).
(c) Actions Against Parties; Notification. Each indemnified party shall
give notice as promptly as reasonably practicable to each indemnifying party of
any action commenced against it in respect of which indemnity may be sought
hereunder, but failure to so notify an indemnifying party shall not relieve such
indemnifying party from any liability hereunder to the extent it is not
materially prejudiced as a result thereof and in any event shall not relieve it
from any liability which it may have otherwise than on account of this indemnity
agreement. In the case of parties indemnified pursuant to Section 6(a) above,
counsel to the indemnified parties shall be selected by Xxxxxxx Xxxxx, and, in
the case of parties indemnified pursuant to Section 6(b) above, counsel to the
indemnified parties shall be selected by the Issuer. An indemnifying party may
participate at its own expense in the defense of any such action; provided,
however, that counsel to the indemnifying party shall not (except with the
consent of the indemnified party) also be counsel to the indemnified party. In
no event shall the indemnifying parties be liable for fees and expenses of more
than one counsel (in addition to any local counsel) separate from their own
counsel for all indemnified parties in connection with any one action or
separate but similar or related actions in the same jurisdiction arising out of
the same general allegations or circumstances. No indemnifying party shall,
without the prior written consent of the indemnified parties, settle or
compromise or consent to the entry of any judgment with respect to any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever in respect of which
indemnification or contribution could be sought under this Section 6 or Section
7 hereof (whether or not the indemnified parties are actual or potential parties
thereto), unless such settlement, compromise or consent (i) includes an
unconditional release of each indemnified party from all liability arising out
of such litigation, investigation, proceeding or claim and (ii) does not include
a statement as to or an admission of fault, culpability or a failure to act by
or on behalf of any indemnified party.
(d) Settlement Without Consent if Failure to Reimburse. If at any time
an indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel, such indemnifying party
agrees that it shall be liable for any settlement of the nature contemplated by
Section 6(a)(ii) effected without its written consent if (i) such settlement is
entered into more than 45 days after receipt by such indemnifying party of the
21
aforesaid request, (ii) such indemnifying party shall have received notice of
the terms of such settlement at least 30 days prior to such settlement being
entered into and (iii) such indemnifying party shall not have reimbursed such
indemnified party in accordance with such request prior to the date of such
settlement.
SECTION 7. Contribution. If the indemnification provided for in Section
6 hereof is for any reason unavailable to or insufficient to hold harmless an
indemnified party in respect of any losses, liabilities, claims, damages or
expenses referred to therein, then each indemnifying party shall contribute to
the aggregate amount of such losses, liabilities, claims, damages and expenses
incurred by such indemnified party, as incurred, (i) in such proportion as is
appropriate to reflect the relative benefits received by the Issuer on the one
hand and the Underwriters on the other hand from the offering of the Securities
pursuant to this Agreement or (ii) if the allocation provided by clause (i) is
not permitted by applicable law, in such proportion as is appropriate to reflect
not only the relative benefits referred to in clause (i) above but also the
relative fault of the L.L.C. and the Issuer on the one hand and of the
Underwriters on the other hand in connection with the statements or omissions
that resulted in such losses, liabilities, claims, damages or expenses, as well
as any other relevant equitable considerations.
The relative benefits received by the Issuer on the one hand and the
Underwriters on the other hand in connection with the offering of the Securities
pursuant to this Agreement shall be deemed to be in the same respective
proportions as the total net proceeds from the offering of the Securities
pursuant to this Agreement (before deducting expenses) received by the Company
and the total underwriting discount received by the Underwriters, in each case
as set forth on the cover of the Prospectus, or, if Rule 434 is used, the
corresponding location on the Term Sheet, bear to the aggregate initial public
offering price of the Securities as set forth on such cover.
The relative fault of the L.L.C. and the Issuer on the one hand and the
Underwriters on the other hand shall be determined by reference to, among other
things, whether any such untrue or alleged untrue statement of a material fact
or omission or alleged omission to state a material fact relates to information
supplied by the L.L.C. and the Issuer or by the Underwriters and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission.
The L.L.C. and the Issuer and the Underwriters agree that it would not
be just and equitable if contribution pursuant to this Section 7 were determined
by pro rata allocation (even if the Underwriters were treated as one entity for
such purpose) or by any other method of allocation which does not take account
of the equitable considerations referred to above in this Section 7. The
aggregate amount of losses, liabilities, claims, damages and expenses incurred
by an indemnified party and referred to above in this Section 7 shall be deemed
to include any legal or other expenses reasonably incurred by such indemnified
party in investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental
22
agency or body, commenced or threatened, or any claim whatsoever based upon any
such untrue or alleged untrue statement or omission or alleged omission.
Notwithstanding the provisions of this Section 7, no Underwriter shall
be required to contribute any amount in excess of the amount by which the total
price at which the Securities underwritten by it and distributed to the public
were offered to the public exceeds the amount of any damages which such
Underwriter has otherwise been required to pay by reason of any 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 1933 Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 7, each person, if any, who controls an
Underwriter within the meaning of Section 15 of the 1933 Act or Section 20 of
the 1934 Act shall have the same rights to contribution as such Underwriter, and
each director of the Issuer, each officer of the Issuer who signed the
Registration Statement, and each person, if any, who controls the Issuer within
the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act shall
have the same rights to contribution as the Issuer. The Underwriters' respective
obligations to contribute pursuant to this Section are several in proportion to
the respective principal amount and principal amount at maturity of Securities
set forth opposite their respective names in Schedule A hereto and not joint.
SECTION 8. Representations, Warranties and Agreements to Survive
Delivery. All representations, warranties and agreements contained in this
Agreement or in certificates of officers of the Company or any of its
subsidiaries submitted pursuant hereto shall remain operative and in full force
and effect, regardless of any investigation made by or on behalf of any
Underwriter or controlling person, or by or on behalf of the Company, and shall
survive delivery of the Securities to the Underwriters.
SECTION 9. Termination of Agreement.
(a) Termination; General. The Representatives may terminate this
Agreement, by notice to the Issuer on behalf of the L.L.C. and the Issuer, as
applicable, at any time at or prior to Closing Time (i) if there has been, since
the time of execution of this Agreement or since the respective dates as of
which information is given in the Prospectus, any material adverse change in the
condition, financial or otherwise, or in the earnings, business affairs or
business prospects of the Company and its subsidiaries considered as one
enterprise, whether or not arising in the ordinary course of business, or (ii)
if there has occurred any material adverse change in the financial markets in
the United States or the international financial markets, any outbreak of
hostilities or escalation thereof or other calamity or crisis or any change or
development involving a prospective change in national or international
political, financial or economic
23
conditions, in each case the effect of which is such as to make it, in the
judgment of the Representatives, impracticable to market the Securities or to
enforce contracts for the sale of the Securities, or (iii) if trading in any
securities of the Issuer has been suspended or materially limited by the
Commission or the Nasdaq National Market, or if trading generally on the
American Stock Exchange or the New York Stock Exchange or in the Nasdaq National
Market has been suspended or materially limited, or minimum or maximum prices
for trading have been fixed, or maximum ranges for prices have been required, by
any of said exchanges or by such system or by order of the Commission, the NASD
or any other governmental authority, or (iv) if a banking moratorium has been
declared by either Federal or New York authorities.
(b) Liabilities. If this Agreement is terminated pursuant to this
Section 9, such termination shall be without liability of any party to any other
party except as provided in Section 4 hereof, and provided further that Sections
1, 6, 7 and 8 shall survive such termination and remain in full force and
effect.
SECTION 10. Default by One or More of the Underwriters. If one or more
of the Underwriters shall fail at Closing Time to purchase the Securities which
it or they are obligated to purchase under this Agreement (the "Defaulted
Securities"), the Representatives shall have the right, within 24 hours
thereafter, to make arrangements for one or more of the non-defaulting
Underwriters, or any other underwriters, to purchase all, but not less than all,
of the Defaulted Securities in such amounts as may be agreed upon and upon the
terms herein set forth; if, however, the Representatives shall not have
completed such arrangements within such 24-hour period, then:
(a) if the number of Defaulted Securities does not exceed 10%
of the aggregate principal amount and principal amount at maturity of
the Securities to be purchased hereunder, the non-defaulting
Underwriters shall be obligated, each severally and not jointly, to
purchase the full amount thereof in the proportions that their
respective underwriting obligations hereunder bear to the underwriting
obligations of all non-defaulting Underwriters, or
(b) if the number of Defaulted Securities exceeds 10% of the
aggregate principal amount and principal amount at maturity of the
Securities to be purchased hereunder, this Agreement shall terminate
without liability on the part of any non-defaulting Underwriter.
No action taken pursuant to this Section 10 shall relieve any
defaulting Underwriter from liability in respect of its default.
In the event of any such default which does not result in a termination
of this Agreement, either the Representatives or the Issuer shall have the right
to postpone Closing Time for a period not exceeding seven days in order to
effect any required changes in the Registration
24
Statement or Prospectus or in any other documents or arrangements. As used
herein, the term "Underwriter" includes any person substituted for an
Underwriter under this Section 10.
SECTION 11. Notices. All notices and other communications hereunder
shall be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the
Underwriters shall be directed to the Representatives at North Tower, World
Financial Center, New York, New York 10281, attention of o; and notices to
either of the Companies shall be directed to the Company at 0000 Xxxxxxxx Xxxx,
Xxxxxx, Xxxxxxxx 00000, xxxxxxxxx xx Xxxxxxxx E. Harris, Esq., with copies to
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP, 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000, xxxxxxxxx of Xxxx X. Xxxxx, Esq.
SECTION 12. Parties. This Agreement shall inure to the benefit of and
be binding upon the Underwriters and the L.L.C. and the Issuer and their
respective successors. Nothing expressed or mentioned in this Agreement is
intended or shall be construed to give any person, firm or corporation, other
than the Underwriters and the L.L.C. and the Issuer and their respective
successors and the controlling persons and officers and directors referred to in
Sections 6 and 7 and their heirs and legal representatives, any legal or
equitable right, remedy or claim under or in respect of this Agreement or any
provision herein contained. This Agreement and all conditions and provisions
hereof are intended to be for the sole and exclusive benefit of the Underwriters
and the L.L.C. and the Issuer and their respective successors, and said
controlling persons and officers and directors and their heirs and legal
representatives, and for the benefit of no other person, firm or corporation. No
purchaser of Securities from any Underwriter shall be deemed to be a successor
by reason merely of such purchase.
SECTION 13. GOVERNING LAW AND TIME. THIS AGREEMENT SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
SPECIFIED TIMES OF DAY REFER TO NEW YORK CITY TIME.
SECTION 14. Effect of Headings. The Article and Section headings
herein and the Table of Contents are for convenience only and shall not affect
the construction hereof.
25
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to each of the L.L.C. and the Issuer a
counterpart hereof, whereupon this instrument, along with all counterparts, will
become a binding agreement between the Underwriters and the L.L.C. and the
Issuer in accordance with its terms.
Very truly yours,
TELIGENT, L.L.C.
By
-----------------------------------
Name:
Title:
TELIGENT, INC.
By
-----------------------------------
Name:
Title:
CONFIRMED AND ACCEPTED,
as of the date first above written:
XXXXXXX XXXXX & CO.
XXXXXXX LYNCH, XXXXXX, XXXXXX & XXXXX INCORPORATED
SALOMON BROTHERS INC
TD SECURITIES (USA) INC.
XXXXXXX, XXXXX & CO.
By
------------------------------------------------
Authorized Signatory
For themselves and as Representatives of the other Underwriters named in
Schedule A hereto.
SCHEDULE A
UNDERWRITERS
Aggregate
Principal Amount
Name of Underwriter of Senior Notes
------------------- ----------------
Xxxxxxx Xxxxx, Xxxxxx, Xxxxxx & Xxxxx
Incorporated............................................................
Salomon Brothers Inc....................................................................
TD Securities (USA) Inc.................................................................
Xxxxxxx, Xxxxx & Co.....................................................................
----------------
Total................................................................................... $
================
Aggregate
Principal at
Maturity Amount
of Senior
Name of Underwriter Discount Notes
------------------- ---------------
Xxxxxxx Xxxxx, Xxxxxx, Xxxxxx & Xxxxx
Incorporated............................................................
Salomon Brothers Inc....................................................................
TD Securities (USA) Inc.................................................................
Xxxxxxx, Xxxxx & Co.....................................................................
----------------
Total................................................................................... $
================
SCHEDULE B-1
PRICING INFORMATION
TELIGENT, INC.
$250,000,000 ___% Senior Notes due 2007
1. The initial public offering price of the Senior Notes shall be 100%
of the principal amount thereof, plus accrued interest, if any, from the date of
issuance.
2. The purchase price to be paid by the Underwriters for the Senior
Notes shall be __% of the principal amount thereof.
3. The interest rate on the Senior Notes shall be __% per annum.
SCHEDULE B-2
PRICING INFORMATION
TELIGENT, INC.
$250,000,000 ___% Senior Discount Notes due 2007
1. The initial public offering price of the Senior Discount Notes shall
be __% of the principal amount at maturity thereof, plus accrued interest, if
any, from the date of issuance.
2. The purchase price to be paid by the Underwriters for the Senior
Discount Notes shall be __% of the principal amount thereof.
3. The interest rate on the Senior Discount Notes shall be __%
per annum.
EXHIBIT A
FORM OF OPINION OF COMPANY COUNSEL
TO BE DELIVERED PURSUANT TO SECTION 5(b)
EXHIBIT B
FORM OF OPINION OF SPECIAL FEDERAL REGULATORY COUNSEL
TO BE DELIVERED PURSUANT TO SECTION 5(b)
EXHIBIT C
FORM OF OPINION OF GENERAL COUNSEL FOR THE COMPANY
TO BE DELIVERED PURSUANT TO SECTION 5(b)
