Exhibit 10.17
METROMEDIA FIBER NETWORK, INC.
$650,000,000
10% Senior Notes Due 2008
Purchase Agreement
New York, New York
November 20, 1998
Xxxxxxx Xxxxx Xxxxxx
Xxxxx Securities Inc.
Deutsche Bank Securities Inc.
Xxxxxxxxx, Lufkin & Xxxxxxxx Securities Corporation
As Representatives of the Initial Purchasers
c/o Xxxxxxx Xxxxx Barney Inc.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Metromedia Fiber Network, Inc., a corporation organized under the laws
of Delaware (the "Company"), proposes to issue and sell to the several parties
named in Schedule I hereto (the "Initial Purchasers"), for whom you (the
"Representatives") are acting as representatives, $650,000,000 aggregate
principal amount of its 10% Senior Notes Due 2008 (the "Securities"). The
Securities are to be issued under an indenture (the "Indenture") to be entered
into between the Company and IBJ Xxxxxxxx Bank & Trust Company, as trustee (the
"Trustee"). The Securities have the benefit of the Registration Rights Agreement
(the "Registration Rights Agreement") to be entered into among the Company and
the Initial Purchasers, pursuant to which the Company has agreed (i) to register
under the Act certain securities (the "Exchange Securities") which will be
offered in exchange (the "Exchange Offer") for the Securities subject to the
terms and conditions therein specified and (ii) under certain circumstances, to
file a shelf registration statement relating to the Securities pursuant to Rule
415 under the Act. Pursuant to the Indenture, and in accordance with the
provisions of the Security Agreement (the "Security Agreement") to be entered
into among the Company, the Trustee and IBJ Xxxxxxxx Bank & Trust Company, as
securities intermediary (the "Securities Intermediary"), the Company has agreed,
to (i) purchase Pledged Securities (as defined in the Indenture) in an amount
that, together with the proceeds from the
investment thereof, will be sufficient to provide for the payment of the first
three scheduled interest payments due on the Securities and (ii) place such
Pledged Securities in an account maintained by the Securities Intermediary for
the benefit of Holders of the Securities. To the extent there are no additional
parties listed on Schedule I other than you, the term Representatives as used
herein shall mean you as the Initial Purchasers, and the terms Representatives
and Initial Purchasers shall mean either the singular or plural as the context
requires. The use of the neuter in this Agreement shall include the feminine and
masculine wherever appropriate. Certain terms used herein are defined in Section
17 hereof.
The sale of the Securities to the Initial Purchasers will be made
without registration of the Securities under the Act in reliance upon exemptions
from the registration requirements of the Act.
In connection with the sale of the Securities, the Company has
prepared a preliminary offering memorandum, dated November 10, 1998 (as amended
or supplemented at the Execution Time, including any and all exhibits thereto
and any information incorporated by reference therein, the "Preliminary
Memorandum"), and a final offering memorandum, dated November 20, 1998 (as
amended or supplemented at the Execution Time, including any and all exhibits
thereto and any information incorporated by reference therein, the "Final
Memorandum"). Each of the Preliminary Memorandum and the Final Memorandum sets
forth certain information concerning the Company and the Securities. The Company
hereby confirms that it has authorized the use of the Preliminary Memorandum and
the Final Memorandum, and any amendment or supplement thereto, in connection
with the offer and sale of the Securities by the Initial Purchasers. Unless
stated to the contrary, any references herein to the terms "amend", "amendment"
or "supplement" with respect to the Final Memorandum shall be deemed to refer to
and include any information filed under the Exchange Act, subsequent to the
Execution Time which is incorporated by reference therein.
1. Representations and Warranties. The Company represents and warrants
to each Initial Purchaser as set forth below in this Section 1 on and as of the
Execution Time and the Closing Date or on and as of such other date as specified
herein.
(a) The Preliminary Memorandum, at the date thereof, did not contain
any untrue statement of a material fact or omit to state any material fact
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading. At the Execution Time
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and on the Closing Date, the Final Memorandum did not, and will not (and
any amendment or supplement thereto, at the date thereof, at the Closing
Date, will not), contain any untrue statement of a material fact or omit to
state any material fact necessary to make the statements therein, in the
light of the circumstances under which they were made, not misleading.
Notwithstanding the foregoing, the Company makes no representation or
warranty as to the information contained in or omitted from the Preliminary
Memorandum or the Final Memorandum, or any amendment or supplement thereto,
in reliance upon and in conformity with information furnished in writing to
the Company by or on behalf of the Initial Purchasers through the
Representatives specifically for inclusion therein, it being understood and
agreed that the only such information is that described as such in Section
8(b) of this Agreement.
(b) Neither the Company, nor any of its Affiliates, nor any person
acting on its or their behalf has, directly or indirectly, made offers or
sales of any security, or solicited offers to buy any security, under
circumstances that would require the registration of the Securities under
the Act.
(c) Neither the Company, nor any of its Affiliates, nor any person
acting on its or their behalf has engaged in any form of general
solicitation or general advertising (within the meaning of Regulation D) in
connection with any offer or sale of the Securities in the United States.
(d) The Securities satisfy the eligibility requirements of Rule
144A(d)(3) under the Act.
(e) Neither the Company, nor any of its Affiliates, nor any person
acting on its or their behalf has engaged in any directed selling efforts
with respect to the Securities, and each of them has complied with the
offering restrictions requirement of Regulation S. Terms used in this
paragraph and defined in Regulation S have the meanings given to them by
Regulation S.
(f) The Company has been advised by the NASD's Private Offerings,
Resales and Trading through Automated Linkages ("PORTAL") market that the
Securities have been designated PORTAL-eligible securities in accordance
with the rules and regulations of the NASD.
(g) 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
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in the Final Memorandum will not be, an "investment company" required to be
registered under the Investment Company Act, without taking account of any
exemption arising out of the number of holders of the Company's securities.
(h) The Company is subject to and in full compliance with the
reporting requirements of Section 13 or Section 15(d) of the Exchange Act.
(i) The Company has not paid or agreed to pay to any person any
compensation for soliciting another to purchase any securities of the
Company (except as contemplated by this Agreement).
(j) The Company has not taken, directly or indirectly, any action
designed to cause or which has constituted or which might reasonably be
expected to cause or result, under the Exchange Act or otherwise, in the
stabilization or manipulation of the price of any security of the Company
to facilitate the sale or resale of the Securities.
(k) The information provided by the Company pursuant to Section 5(h)
hereof will not, at the date thereof, contain any untrue statement of a
material fact or omit to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading.
(l) Each of the Company and its subsidiaries has been duly
incorporated and is validly existing as a corporation or limited liability
company in good standing under the laws of the jurisdiction in which it is
chartered or organized with full corporate power and authority to own or
lease, as the case may be, and to operate its properties and conduct its
business as described in the Final Memorandum, and is duly qualified to do
business as a foreign corporation or limited liability company and is in
good standing under the laws of each jurisdiction which requires such
qualification, except where the failure to be so qualified would not have,
singly or in the aggregate, a material adverse effect on the condition
(financial or otherwise), prospects, earnings, business or properties of
the Company and its subsidiaries, taken as a whole, whether or not arising
from transactions in the ordinary course of business.
(m) All the outstanding shares of capital stock of each subsidiary
that is a corporation have been duly and validly authorized and issued and
are
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fully paid and nonassessable, and, except as otherwise set forth in the
Final Memorandum, all outstanding shares of capital stock of the
subsidiaries are owned by the Company either directly or through wholly
owned subsidiaries free and clear of any perfected security interest or, to
the knowledge of the Company, any other security interests, claims, liens
or encumbrances.
(n) The Company's authorized capitalization is as set forth in the
Final Memorandum under the heading "Capitalization."
(o) The statements in the Final Memorandum under the headings
"Business--Franchise, License and Related Agreements,"
"Business--Regulation," "Business--Regulation of International Operations,"
"Business--Legal Proceedings," "Description of the Notes," "Exchange Offer;
Registration Rights," and "Certain United States Federal Tax
Considerations" fairly summarize the matters therein described in all
material respects.
(p) This Agreement has been duly authorized, executed and delivered by
the Company; the Indenture has been duly authorized by the Company and,
assuming due authorization, execution and delivery thereof by the Trustee,
when executed and delivered by the Company, will constitute a legal, valid,
binding instrument enforceable against the Company in accordance with its
terms (subject to applicable bankruptcy, reorganization, insolvency,
moratorium, fraudulent conveyance or other laws affecting creditors' rights
generally from time to time in effect and to general principles of equity);
the Securities have been duly and validly authorized by the Company, and,
when executed, issued and authenticated in accordance with the provisions
of the Indenture and delivered to and paid for in full by the Initial
Purchasers, will have been duly executed and delivered by the Company and
will constitute the legal, valid and binding obligations of the Company
entitled to the benefits of the Indenture (subject to applicable
bankruptcy, insolvency, moratorium, fraudulent conveyance or other laws
affecting creditors' rights generally from time to time in effect and to
general principles of equity); on the Closing Date the Exchange Securities
will have been duly authorized by the Company, and, when executed, issued
and authenticated in accordance with the terms of the Exchange Offer and
the provisions of the Indenture, will constitute the legal, valid and
binding obligations of the Company entitled to the benefits of the
Indenture (subject to applicable bankruptcy, insolvency, moratorium,
fraudulent conveyance or other laws affecting creditors' rights generally
from time to time in effect and
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to general principles of equity); the Registration Rights Agreement has
been duly authorized by the Company, and, assuming due authorization,
execution and delivery thereof by the Initial Purchasers, when executed and
delivered by the Company, will constitute the legal, valid, binding and
enforceable instrument of the Company (subject to applicable bankruptcy,
reorganization, insolvency, moratorium, fraudulent conveyance or other laws
affecting creditors' rights generally from time to time in effect and to
general principles of equity); the Security Agreement has been duly
authorized by the Company and, assuming due authorization, execution and
delivery thereof by the Trustee and the Securities Intermediary, when
executed and delivered by the Company, will constitute the legal, valid,
binding and enforceable instrument of the Company (subject to applicable
bankruptcy, reorganization, insolvency, moratorium, fraudulent conveyance
or other laws affecting creditors' rights generally from time to time in
effect and to general principles of equity).
(q) No consent, approval, authorization, filing with or order of any
court or governmental agency or body is required in connection with the
transactions contemplated herein or in the Indenture, the Security
Agreement or the Registration Rights Agreement, except such as will be
obtained under the Act and the Trust Indenture Act in connection with the
registration of the Exchange Securities or the Securities, as the case may
be, as contemplated by the Registration Rights Agreement and such as may be
required under the blue sky laws of any jurisdiction in connection with the
purchase and distribution of the Securities by the Initial Purchasers in
the manner contemplated herein, in the Final Memorandum and the
Registration Rights Agreement.
(r) None of the execution and delivery of the Indenture, this
Agreement, the Security Agreement and the Registration Rights Agreement,
the issue and sale of the Securities, the consummation of any of the
transactions herein or therein contemplated, or the fulfillment of the
terms hereof or thereof, will conflict with, result in a breach or
violation or imposition of any lien, charge or encumbrance upon any
property or assets of the Company or any of its subsidiaries, pursuant to
(i) the charter or by-laws of the Company or any of its subsidiaries; (ii)
the terms of any indenture, contract, lease, mortgage, deed of trust, note
agreement, loan agreement or other agreement, obligation, condition,
covenant or instrument to which the Company or any of its subsidiaries is a
party or bound or to which its or their property is subject; or (iii) any
statute, law, rule, regulation, judgment, order
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or decree applicable to the Company or any of its subsidiaries of any
court, regulatory body, administrative agency, governmental body,
arbitrator or other authority having jurisdiction over the Company or any
of its subsidiaries or any of its or their properties, except in the case
of clauses (ii) and (iii), as could not be reasonably expected to have,
singly or in the aggregate, a material adverse effect on the condition
(financial or otherwise), prospects, earnings, business or properties of
the Company and its subsidiaries, taken as a whole, whether or not arising
from transactions in the ordinary course of business.
(s) The consolidated historical financial statements of the Company
and its consolidated subsidiaries included in the Final Memorandum present
fairly in all material respects the financial condition, results of
operations and cash flows of the Company as of the dates and for the
periods indicated and have been prepared in conformity with generally
accepted accounting principles applied on a consistent basis throughout the
periods involved (except as otherwise noted therein); the selected
financial data set forth under the caption "Selected Consolidated Financial
Data" in the Final Memorandum fairly present, on the basis stated in the
Final Memorandum, the information included therein.
(t) No action, suit or proceeding by or before any court or
governmental agency, authority or body or any arbitrator involving the
Company or any of its subsidiaries or its or their property is pending or,
to the best knowledge of the Company, threatened that (i) could reasonably
be expected to have a material adverse effect on the performance of this
Agreement, the Indenture, the Security Agreement or the Registration Rights
Agreement, or the consummation of any of the transactions contemplated
hereby or thereby; or (ii) could reasonably be expected to have a material
adverse effect on the condition (financial or otherwise), prospects,
earnings, business or properties of the Company and its subsidiaries, taken
as a whole, whether or not arising from transactions in the ordinary course
of business, except as set forth in or contemplated in the Final Memorandum
(exclusive of any amendment or supplement thereto).
(u) Except as described in the Final Memorandum, each of the Company
and each of its subsidiaries owns, licenses, leases or has obtained
rights-of-way for all such properties as are necessary to the conduct of
its operations as presently conducted. The Company and each of its
subsidiaries has good and marketable title, free and clear of all liens or
encumbrances, to
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all property and assets described in the Final Memorandum as being owned by
it on the date hereof and such properties and assets are in good repair and
suitable for use as so described except as set forth in the Final
Memorandum. All leases to which the Company or its subsidiaries are a party
are valid and binding (subject to applicable bankruptcy, reorganization,
insolvency, moratorium, fraudulent conveyance or other laws affecting
creditors' rights generally from time to time in effect and to general
principles of equity) and no default has occurred or is continuing
thereunder which could have, singly or in the aggregate, a material adverse
effect on the condition (financial or otherwise), prospects, earnings,
business or properties of the Company and its subsidiaries, taken as a
whole, whether or not arising from transactions in the ordinary course of
business, and the Company and each subsidiary enjoy peaceful and
undisturbed possession under all such leases to which any of them is a
party as lessee with such exceptions as do not interfere materially with
the use made by the Company or such subsidiary.
(v) Neither the Company nor any subsidiary is in violation or default
of (i) any provision of its charter or bylaws; (ii) the terms of any
indenture, contract, lease, mortgage, deed of trust, note agreement, loan
agreement or other agreement, obligation, condition, covenant or instrument
to which it is a party or bound or to which its property is subject; or
(iii) any statute, law, rule, regulation, judgment, order or decree
applicable to the Company or any of its subsidiaries of any court,
regulatory body, administrative agency, governmental body, arbitrator or
other authority having jurisdiction over the Company or such subsidiary or
any of its properties, as applicable, except in the case of clauses (ii)
and (iii) as could not be reasonably expected to have, singly or in the
aggregate, a material adverse effect on the condition (financial or
otherwise), prospects, earnings, business or properties of the Company and
its subsidiaries, taken as a whole, whether or not arising from
transactions in the ordinary course of business.
(w) Each of (i) X.X. Xxxxxx & Co. LLP and (ii) Ernst & Young LLP, each
of whom have audited certain financial statements of the Company and its
consolidated subsidiaries and delivered their report with respect to the
audited consolidated financial statements included in the Final Memorandum,
are independent public accountants with respect to the Company within the
meaning of the Act and the applicable published rules and regulations
thereunder.
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(x) The Company and each subsidiary has filed all foreign, federal,
state and local tax returns that are required to be filed or has requested
extensions thereof except in any case in which the failure so to file would
not have, singly or in the aggregate, a material adverse effect on the
condition (financial or otherwise), prospects, earnings, business or
properties of the Company and its subsidiaries, taken as a whole, whether
or not arising from transactions in the ordinary course of business, and
has paid all 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 assessment, fine or penalty that is
currently being contested in good faith or as would not have, singly or in
the aggregate, a material adverse effect on the condition (financial or
otherwise), prospects, earnings, business or properties of the Company and
its subsidiaries, taken as a whole, whether or not arising from
transactions in the ordinary course of business.
(y) No labor problem or dispute with the employees of the Company or
any of its subsidiaries exists or is threatened or imminent that could
have, singly or in the aggregate, a material adverse effect on the
condition (financial or otherwise), prospects, earnings, business or
properties of the Company and its subsidiaries, taken as a whole, whether
or not arising from transactions in the ordinary course of business.
(z) 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; all policies of insurance and fidelity or surety bonds
insuring the Company or any of its subsidiaries or their respective
businesses, assets, employees, officers and directors are in full force and
effect; the Company and its subsidiaries are in compliance with the terms
of such policies and instruments in all material respects; and there are no
claims by the Company or any of its subsidiaries under any such policy or
instrument as to which any insurance company is denying liability or
defending under a reservation of rights clause; neither the Company nor any
such subsidiary has been refused any insurance coverage sought or applied
for; and neither the Company nor any such subsidiary 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, singly or in the aggregate, a material adverse effect
on the condition (financial or otherwise), prospects, earnings, business or
properties of the Company and
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its subsidiaries, taken as a whole, whether or not arising from
transactions in the ordinary course of business.
(aa) Except as described in the Final Memorandum, no subsidiary of the
Company is currently prohibited, directly or indirectly, from paying any
dividends to the Company, from making any other distribution on such
subsidiary's capital stock, from repaying to the Company any loans or
advances to such subsidiary from the Company or from transferring any of
such subsidiary's property or assets to the Company or any other subsidiary
of the Company.
(bb) Except as described in the Final Memorandum, the Company and its
subsidiaries (i) possess the certificates, authorizations, approvals,
franchises, licenses, rights-of-way and permits issued by the appropriate
federal, state, local or foreign regulatory authorities necessary to
conduct their respective businesses as presently conducted, (ii) are not in
violation of any such certificates, authorizations, approvals, franchises,
licenses, rights-of-way and permits, except where such violation would not
have a material adverse effect on the condition (financial or otherwise),
prospects, earnings, business or properties of the Company and its
subsidiaries, taken as a whole, whether or not arising from transactions in
the ordinary course of business and (iii) have not received any notice of
proceedings relating to the revocation or modification of any such
certificate, authorization, approval, franchise, license, right-of-way or
permit which, singly or in the aggregate, if the subject of an unfavorable
decision, ruling or finding, would have a material adverse effect on the
condition (financial or otherwise), prospects, earnings, business or
properties of the Company and its subsidiaries, taken as a whole, whether
or not arising from transactions in the ordinary course of business.
(cc) The Company and its subsidiaries possess or have applied for
the 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 and trade names (collectively, "Intellectual
Property") presently employed by them in connection with the businesses
now operated by them, and neither the Company nor any of the
Subsidiaries has received any notice of infringement of or conflict with
asserted rights of others with respect to the foregoing except as could
not have, singly or in the aggregate, a material adverse effect on the
condition (financial or otherwise), prospects, earnings,
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business or properties of the Company and its subsidiaries, taken as a
whole, whether or not arising from transactions in the ordinary course of
business. To the Company's knowledge, the use of such Intellectual Property
in connection with the business and operations of the Company and its
subsidiaries does not infringe on the rights of any person.
(dd) 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 intervals and
appropriate action is taken with respect to any differences.
(ee) The Company and its subsidiaries are (i) 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 and are in compliance with all
permits, licenses or other approvals required of them under applicable
Environmental Laws to conduct their respective businesses as described in
the Final Memorandum; and (iii) have not received notice of any actual or
potential liability for the investigation or remediation of any disposal or
release of hazardous or toxic substances or wastes, pollutants or
contaminants, except where such non-compliance with Environmental Laws,
failure to receive required permits, licenses or other approvals, or
liability would not, individually or in the aggregate, have a material
adverse effect on the condition (financial or otherwise), prospects,
earnings, business or properties of the Company and its subsidiaries, taken
as a whole, whether or not arising from transactions in the ordinary course
of business; neither the Company nor any of the subsidiaries has been
notified that it has been named as a "potentially responsible party" under
the Comprehensive Environmental Response, Compensation, and Liability Act
of 1980, as amended.
(ff) Except as described in the Final Memorandum, the Company and its
subsidiaries are implementing a comprehensive, detailed program to analyze
and address the risk that the computer hardware and software used by
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them may be unable to recognize and properly execute date-sensitive
functions involving certain dates prior to and any dates after December 31,
1999 (the "Year 2000 Problem"), and reasonably believe that such risk will
be remedied on a timely basis without material expense and will not have a
material adverse effect upon the financial condition and results of
operations of the Company and its subsidiaries, taken as a whole.
(gg) Each of the Company and its subsidiaries has fulfilled its
obligations, if any, under the minimum funding standards of Xxxxxxx 000 xx
xxx Xxxxxx Xxxxxx Employee Retirement Income Security Act of 1974, as
amended ("ERISA"), and the regulations and published interpretations
thereunder with respect to each "plan" (as defined in Section 3(3) of ERISA
and such regulations and published interpretations) in which employees of
the Company and its subsidiaries are eligible to participate and each such
plan is in compliance in all material respects with the presently
applicable provisions of ERISA and such regulations and published
interpretations; the Company and its subsidiaries have not incurred any
unpaid liability to the Pension Benefit Guaranty Corporation (other than
for the payment of premiums in the ordinary course) or to any such plan
under Title IV of ERISA.
(hh) The subsidiaries listed on Schedule II attached hereto are the
only significant subsidiaries of the Company as defined in Rule 1-02 of
Regulation S-X (individually, a "Subsidiary" and collectively, the
"Subsidiaries").
(ii) None of the transactions contemplated by this Agreement
(including, without limitation, the use of the proceeds from the sale of
the Securities) will violate or result in a violation of Section 7 of the
Exchange Act, or any regulation promulgated thereunder, including, without
limitation, Regulations T, U and X of the Board of Governors of the Federal
Reserve System.
(jj) Neither the Company nor any of the subsidiaries is a "holding
company" or a "subsidiary company" of a holding company, or an "affiliate"
thereof required to be registered under the Public Utility Holding Company
Act of 1935, as amended.
(kk) Neither the Company nor any of its subsidiaries nor, to the
Company's knowledge, any employee or agent of the Company or any
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subsidiary has made any payment of funds of the Company or any subsidiary
or received or retained any funds in violation of any provision of the
Foreign Corrupt Practices Act of 1977, as amended.
(ll) When the Pledged Securities are transferred to the Trustee in
accordance with the provisions of the Security Agreement, and assuming that
the representations and warranties of the Trustee and the Securities
Intermediary contained in the Security Agreement are true and correct and
compliance by the Trustee and the Securities Intermediary with the
provisions thereof, the pledge of and grant of a security interest in the
Pledged Securities will constitute a valid first priority perfected
security interest in such Pledged Securities, enforceable as such against
all creditors of the Company (and any persons purporting to purchase any of
the Pledged Securities from the Company), subject to applicable bankruptcy,
reorganization, insolvency, moratorium, fraudulent conveyance or other laws
affecting creditors' rights generally from time to time in effect, and all
filings and actions (other than the transfer to the Trustee of the Pledged
Securities) necessary or desirable to perfect and protect such security
interest have been duly taken.
Any certificate signed by any officer of the Company and delivered to
the Representatives or counsel for the Initial Purchasers in connection with the
offering of the Securities shall be deemed a representation and warranty by the
Company, as to matters covered thereby, to each Initial Purchaser.
2. Purchase and Sale. Subject to the terms and conditions and in
reliance upon the representations and warranties herein set forth, the Company
agrees to sell to each Initial Purchaser, and each Initial Purchaser agrees,
severally and not jointly, to purchase from the Company, at a purchase price of
97.000% of the principal amount thereof, plus accrued interest, if any, from the
Closing Date, the principal amount of Securities set forth opposite such Initial
Purchaser's name in Schedule I hereto.
3. Delivery and Payment. Delivery of and payment for the Securities
shall be made at 10:00 A.M., New York City time, on November 25, 1998, or at
such time on such later date (not later than seven full business days
thereafter) as the Representatives shall designate, which date and time may be
postponed by agreement between the Representatives and the Company or as
provided in Section 9 hereof (such date and time of delivery and payment for the
Securities being herein called the "Closing Date"). Delivery of the Securities
shall be made to the
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Representatives for the respective accounts of the several Initial Purchasers
against payment by the several Initial Purchasers through the Representatives of
the purchase price thereof to or upon the order of the Company by wire transfer
payable in same-day funds to the account specified by the Company. The Company
shall not be obligated to deliver any of the Securities, except upon payment for
all of the Securities to be purchased as provided herein. Delivery of the
Securities shall be made through the facilities of The Depository Trust Company
unless the Representatives shall otherwise instruct.
4. Offering by Initial Purchasers. Each Initial Purchaser, severally
and not jointly, represents and warrants to and agrees with the Company that:
(a) It has not offered or sold, and will not offer or sell, any
Securities except (i) to those it reasonably believes to be qualified
institutional buyers (as defined in Rule 144A under the Act) and that, in
connection with each such sale, it has taken or will take reasonable steps
to ensure that the purchaser of such Securities is aware that such sale is
being made in reliance on Rule 144A; or (ii) in accordance with the
restrictions set forth in Exhibit A hereto.
(b) Neither it nor any person acting on its behalf has made or will
make offers or sales of the Securities in the United States by means of any
form of general solicitation or general advertising (within the meaning of
Regulation D) in the United States.
(c) Each Initial Purchaser will deliver to each purchaser of the
Securities from such Initial Purchaser, in connection with its original
distribution of the Securities, a copy of the Final Memorandum, as amended
and supplemented at the date of such delivery.
5. Agreements. The Company agrees with each Initial Purchaser that:
(a) The Company will furnish to each Initial Purchaser and to counsel
for the Initial Purchasers, without charge, during the period referred to
in paragraph (c) below, as many copies of the Final Memorandum and any
amendments and supplements thereto as it may reasonably request.
(b) The Company will not amend or supplement the Final Memorandum,
other than by filing documents under the Exchange Act that are incorporated
by reference therein, without the prior written consent of the
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Representatives, which consent shall not be unreasonably withheld,
conditioned or delayed; provided, however, that, prior to the completion of
the distribution of the Securities by the Initial Purchasers (as determined
by the Initial Purchasers), the Company will not file any document under
the Exchange Act that is incorporated by reference in the Final Memorandum
unless, prior to such proposed filing, the Company has furnished the
Representatives with a copy of such document for their review and the
Representatives have not reasonably objected to the filing of such document
within a reasonable period of time. The Company will promptly advise the
Representatives when any document filed under the Exchange Act that is
incorporated by reference in the Final Memorandum shall have been filed
with the Commission.
(c) If at any time prior to the completion of the sale of the
Securities by the Initial Purchasers (as determined by the
Representatives), any event occurs as a result of which the Final
Memorandum, as then amended or supplemented, would include any untrue
statement of a material fact or omit to state any material fact necessary
to make the statements therein, in the light of the circumstances under
which they were made, not misleading, or if it should be necessary to amend
or supplement the Final Memorandum to comply with applicable law, the
Company promptly (i) will notify the Representatives of any such event;
(ii) subject to the requirements of paragraph (b) of this Section 5, will
prepare an amendment or supplement that will correct such statement or
omission or effect such compliance; and (iii) will supply any supplemented
or amended Final Memorandum to the several Initial Purchasers and counsel
for the Initial Purchasers without charge in such quantities as you may
reasonably request.
(d) The Company will arrange, if necessary, for the qualification of
the Securities for sale by the Initial Purchasers under the laws of such
jurisdictions as the Initial Purchasers may designate and will maintain
such qualifications in effect so long as may be required for the sale of
the Securities; provided that in no event shall the Company be obligated to
qualify to do business in any jurisdiction where it is not now so qualified
or to take any action that would subject it to service of process in suits,
other than those arising out of the offering or sale of the Securities, in
any jurisdiction where it is not now so subject. The Company will promptly
advise the Representatives of the receipt by the Company of any
notification with respect to the suspension of the qualification of the
Securities for sale in any jurisdiction or the initiation or threatening of
any proceeding for such
15
purpose. The Company shall use its best efforts to prevent the issuance of
any order suspending the qualification or exemption of the Securities under
any state securities or Blue Sky laws, and, if at any time any state
securities commission or any other regulatory authority shall issue an
order suspending the qualification or exemption of the Securities under any
state securities or Blue Sky laws, the Company shall use every reasonable
effort to obtain the withdrawal or lifting of such order at the earliest
possible time.
(e) The Company will not, and will not permit any of its Affiliates
to, resell any Securities that have been acquired by any of them for a
period of two years from the Closing Date, except for Securities acquired
by the Company or any of its Affiliates and resold in a transaction
registered under the Act.
(f) Neither the Company, nor any of its Affiliates, nor any person
acting on its or their behalf will, directly or indirectly, make offers or
sales of any security, or solicit offers to buy any security, under
circumstances that would require the registration of the Securities under
the Act.
(g) Neither the Company, nor any of its Affiliates, nor any person
acting on its or their behalf will engage in any form of general
solicitation or general advertising (within the meaning of Regulation D) in
connection with any offer or sale of the Securities in the United States.
(h) So long as any of the Securities are "restricted securities"
within the meaning of Rule 144(a)(3) under the Act, the Company will,
during any period in which it is not subject to and in compliance with
Section 13 or 15(d) of the Exchange Act or it is not exempt from such
reporting requirements pursuant to and in compliance with Rule 12g3-2(b)
under the Exchange Act, provide to each holder of such restricted
securities and to each prospective purchaser (as designated by such holder)
of such restricted securities, upon the request of such holder or
prospective purchaser, any information required to be provided by Rule
144A(d)(4) under the Act. This covenant is intended to be for the benefit
of the holders, and the prospective purchasers designated by such holders,
from time to time of such restricted securities.
(i) Neither the Company, nor any of its Affiliates, nor any person
acting on its or their behalf, will engage in any directed selling efforts
with respect to the Securities, and each of them will comply with the
offering
16
restrictions requirement of Regulation S. Terms used in this paragraph that
are defined in Regulation S have the meanings given to them by Regulation
S.
(j) The Company will cooperate with the Representatives and use its
best efforts to permit the Securities to be eligible for clearance and
settlement through The Depository Trust Company.
(k) The Company will not for a period of 180 days following the
Execution Time, without the prior written consent of Xxxxxxx Xxxxx Xxxxxx
Inc., offer, sell or contract to sell, grant any other option to purchase
or otherwise dispose of (or enter into any transaction which is designed
to, or might reasonably be expected to, result in the disposition (whether
by actual disposition or effective economic disposition due to cash
settlement or otherwise) by the Company or any Affiliate of the Company or
any person in privity with the Company or any Affiliate of the Company),
directly or indirectly, any debt securities issued or guaranteed by the
Company (other than the Securities) except to the extent contemplated by
the Registration Rights Agreement or the Final Memorandum.
(l) The Company will not take, directly or indirectly, any action
designed to or which has constituted or which might reasonably be expected
to cause or result, under the Exchange Act or otherwise, in stabilization
or manipulation of the price of any security of the Company to facilitate
the sale or resale of the Securities.
(m) The Company will assist the Initial Purchasers in arranging for
the Securities to be designated PORTAL market securities in accordance with
the rules and regulations adopted by the NASD relating to trading in the
PORTAL market and in maintaining such designation.
(n) The Company will not, for so long as the Securities are
outstanding, be or become, or be or become owned by, an open-end investment
company, unit investment trust or face-amount certificate company that is
or is required to be registered under Section 8 of the Investment Company
Act, and will not be or become, or be or become owned by, a closed-end
investment company required to be registered, but not registered
thereunder.
17
(o) The Company will apply the net proceeds from the sale of the
Securities as set forth in the Offering Memorandum under the heading "Use
of Proceeds."
(p) The Company agrees to pay the costs and expenses relating to the
following matters: (i) the preparation of the Indenture and the
Registration Rights Agreement, the issuance of the Securities and the fees
of the Trustee; (ii) the preparation, printing or reproduction of the
Preliminary Memorandum and Final Memorandum and each amendment or
supplement to either of them; (iii) the printing (or reproduction) and
delivery (including postage, air freight charges and charges for counting
and packaging) of such copies of the Preliminary Memorandum and Final
Memorandum, and all amendments or supplements to either of them, as may, in
each case, be reasonably requested for use in connection with the offering
and sale of the Securities; (iv) the preparation, printing, authentication,
issuance and delivery of certificates for the Securities, including any
stamp or transfer taxes in connection with the original issuance and sale
of the Securities; (v) the printing (or reproduction) and delivery of this
Agreement, any blue sky memorandum and all other agreements or documents
printed (or reproduced) and delivered in connection with the offering of
the Securities; (vi) any registration or qualification of the Securities
for offer and sale under the securities or blue sky laws of the several
states (including filing fees and the reasonable fees and expenses of one
counsel for the Initial Purchasers relating to such registration and
qualification); (vii) admitting the Securities for trading the PORTAL
market; (viii) the transportation and other expenses incurred by or on
behalf of Company representatives in connection with presentations to
prospective purchasers of the Securities; (ix) the fees and expenses of the
Company's accountants and the fees and expenses of counsel (including local
and special counsel) for the Company; and (x) all other costs and expenses
incident to the performance by the Company of its obligations hereunder;
provided, however, that, except as otherwise provided for herein, the
Initial Purchasers shall pay their own costs and expenses, including the
fees of their counsel, and, after the filing and effectiveness of a
registration statement pursuant to the Registration Rights Agreement, any
advertising expenses connected with any offers they may make.
(q) The Company agrees to do and perform all things required to be
done and performed by it under this Agreement that are within its control
on or prior to or after the Closing Date, as applicable, and to use its
best
18
efforts to satisfy all conditions precedent on its part to the delivery of
the Securities.
6. Conditions to the Obligations of the Initial Purchasers. The
obligations of the Initial Purchasers to purchase the Securities shall be
subject to the accuracy of the representations and warranties on the part of the
Company contained herein at the Execution Time and the Closing Date, to the
accuracy of the statements of the Company made in any certificates pursuant to
the provisions hereof, to the performance by the Company of its obligations
hereunder and to the following additional conditions:
(a) The Company shall have requested and caused Xxxxxx X. Xxxxxx,
General Counsel of the Company, to furnish to the Representatives his
opinion, dated the Closing Date and addressed to the Representatives, to
the effect that:
(i) Each of the Company's Subsidiaries has been duly incorporated
and is validly existing as a corporation in good standing under the
laws of the jurisdiction in which it is chartered or organized, with
full corporate power and authority to own or lease, as the case may
be, and to operate its properties and conduct its business as
described in the Final Memorandum;
(ii) all the outstanding shares of capital stock of the Company
and each Subsidiary have been duly and validly authorized and issued
and are fully paid and nonassessable, and, except as otherwise set
forth in the Final Memorandum, all outstanding shares of capital stock
of the Subsidiaries are owned by the Company either directly or
through wholly owned subsidiaries free and clear of any security
interest and, to the knowledge of such counsel, after due inquiry, any
other security interests, claims, liens or encumbrances;
(iii) the Company's authorized capitalization is as set forth in
the Final Memorandum under the heading "Capitalization";
(iv) to the knowledge of such counsel, without conducting a
docket search, there is no pending or threatened action, suit or
proceeding by or before any court or governmental agency, authority or
body or any arbitrator involving the Company or any of its
subsidiaries or its or their property that is not adequately disclosed
in
19
the Final Memorandum, except in each case for such proceedings that,
if the subject of an unfavorable decision, ruling or finding would not
singly or in the aggregate, result in a material adverse change in the
condition (final or otherwise), prospects, earnings, business or
properties of the Company and its subsidiaries, taken as a whole; and
the statements in the Final Memorandum under the heading
"Business--Legal Proceedings" fairly summarize the matters therein
described; and
(v) neither the execution and delivery of the Indenture, this
Agreement, the Security Agreement or the Registration Rights
Agreement, the issue and sale of the Securities, nor the consummation
of any other of the transactions herein or therein contemplated, nor
the fulfillment of the terms hereof or thereof, will conflict with,
result in a breach or violation of, or imposition of any lien, charge
or encumbrance upon any property or asset of the Company or its
subsidiaries pursuant to, (i) the charter or by-laws of the Company's
subsidiaries; or (ii) the terms of any indenture, contract, lease,
mortgage, deed of trust, note agreement, loan agreement or other
agreement, obligation, condition, covenant or instrument to which the
Company or any of its subsidiaries is a party or bound or to which its
respective property is subject which is known to such counsel.
(b) The Company shall have requested and caused Xxxx, Weiss, Rifkind,
Xxxxxxx & Xxxxxxxx, counsel for the Company, to furnish to the
Representatives its opinion, dated the Closing Date and addressed to the
Representatives, to the effect that:
(i) The Company and each of the Subsidiaries incorporated or
organized under the laws of the States of Delaware or New York has
been duly incorporated and is validly existing as a corporation in
good standing under the laws of the State of Delaware or New York, as
applicable, with full corporate power and authority to own or lease,
as the case may be, and to operate its properties and conduct its
business as described in the Final Memorandum;
(ii) the Indenture has been duly authorized, executed and
delivered by the Company, and, assuming due authorization, execution
and delivery thereof by the Trustee, constitutes a legal, valid and
binding instrument enforceable against the Company in
20
accordance with its terms (subject to applicable bankruptcy,
reorganization, insolvency, moratorium, fraudulent conveyance or other
laws affecting creditors' rights generally from time to time in effect
and to general principles of equity); the Securities have been duly
and validly authorized by the Company, and, when executed, issued and
authenticated in accordance with the provisions of the Indenture and
delivered to and paid for in full by the Initial Purchasers under this
Agreement, will constitute legal, valid and binding obligations of the
Company entitled to the benefits of the Indenture (subject to
applicable bankruptcy, reorganization, insolvency, moratorium,
fraudulent conveyance or other laws affecting creditors' rights
generally from time to time in effect and to general principles of
equity); the Exchange Securities have been duly authorized by the
Company, and, when executed, issued and authenticated in accordance
with the terms of the Exchange Offer and the provisions of the
Indenture, will constitute the legal, valid and binding obligations of
the Company entitled to the benefits of the Indenture (subject to
applicable bankruptcy, insolvency, moratorium, fraudulent conveyance
or other laws affecting creditors' rights generally from time to time
in effect and to general principles of equity); the Registration
Rights Agreement has been duly authorized, executed and delivered by
the Company, and, assuming due authorization, execution and delivery
thereof by the Initial Purchasers, constitutes a legal, valid and
binding instrument enforceable against the Company in accordance with
its terms (subject to applicable bankruptcy, reorganization,
insolvency, moratorium, fraudulent conveyance or other laws affecting
creditors' rights generally from time to time in effect and to general
principles of equity); the Security Agreement has been duly
authorized, executed and delivered by the Company, and the statements
set forth under the heading "Description of the Notes" and "Exchange
Offer; Registration Rights" in the Final Memorandum, insofar as such
statements purport to summarize certain provisions of the Securities,
the Indenture and the Registration Rights Agreement, provide a fair
summary of such provisions;
(iii) the statements in the Final Memorandum under the heading
"Certain United States Federal Tax Considerations" fairly summarize
the matters therein described;
21
(iv) such counsel has participated in conferences with officers
and other representatives of the Company, representatives of the
independent accountants of the Company, the Initial Purchasers and
counsel for the Initial Purchasers at which the consents of the Final
Memorandum and related matters were discussed and, although such
counsel is not passing upon, and does not assume any responsibility
for, the accuracy, completeness or fairness of the statements
contained in the Final Memorandum (or any amendments or supplements
thereto) and has made no independent check or verification thereof, on
the basis of the foregoing, no facts have come to the attention of
such counsel that have led such counsel to believe that at the
Execution Time and on the Closing Date the Final Memorandum contained
or contains any untrue statement of a material fact or omitted or
omits to state any material fact necessary to make the statements
therein, in the light of the circumstances under which they were made,
not misleading (in each case, other than the financial statements,
schedules and other financial and statistical information contained
therein, as to which such counsel need express no opinion);
(v) this Agreement has been duly authorized, executed and
delivered by the Company;
(vi) no consent, approval, authorization, filing with or order of
any court or governmental agency or body under the Federal laws of the
United States or the laws of the State of New York or under the
General Corporation Law of the State of Delaware is required in
connection with the due authorization, execution and delivery of this
Agreement or the due execution, delivery or performance of the
Indenture by the Company, or for the offering, issuance, sale or
delivery of the securities or the Exchange Securities or for the
resale by you in accordance with the terms of this Agreement, except
such as will be obtained under the Act and the Trust Indenture Act in
connection with the registration of the Exchange Securities or the
Securities, as the case may be, as contemplated by the Registration
Rights Agreement and such as may be required under the blue sky or
securities laws of any state or foreign jurisdiction or the NASD or
and such other approvals (specified in such opinion) as have been
obtained (provided that such counsel need not express any opinion with
respect to any consent,
22
approval, authorization under the Communications Act of 1934, as
amended, or any published rules, regulations or policies of the
Federal Communications Commission (the "FCC") thereunder);
(vii) neither the execution and delivery of the Indenture, this
Agreement, the Security Agreement or the Registration Rights
Agreement, the issue and sale of the Securities, nor the consummation
of any other of the transactions herein or therein contemplated, nor
the fulfillment of the terms hereof or thereof, will conflict with,
result in a breach or violation of, or imposition of any lien, charge
or encumbrance upon any property or asset of the Company or its
subsidiaries pursuant to, (i) the charter or by-laws of the Company;
or (ii) any statute, law, rule or regulation of the Federal government
of the United States (excluding the FCC) or the State of New York or
under the General Corporation Law of the State of Delaware, or to such
counsel's knowledge, any judgment, order or decree applicable to the
Company or any of its subsidiaries of any court, regulatory body,
administrative agency, governmental body, arbitrator or other
authority having jurisdiction over the Company, any of its
subsidiaries or any of their respective properties which is known to
such counsel except as described in the Final Memorandum or for such
violations as could not be reasonably expected to have, singly or in
the aggregate, a material adverse effect on the condition (financial
or otherwise), prospects, earnings, business or properties of the
Company and its subsidiaries, taken as a whole;
(viii) assuming the accuracy of the representations and
warranties contained in the Security Agreement, due performance of the
covenants and agreements contained herein, due compliance with the
offering and transfer procedures and restrictions described in the
Final Memorandum, and that purchasers to whom the Initial Purchasers
initially resell the Securities receive a copy of the Final Memorandum
prior to such sale, no registration of the Securities under the Act,
and no qualification of the Indenture under the Trust Indenture Act,
are required for the offer and sale by the Initial Purchasers of the
Securities in the manner contemplated by this Agreement;
(ix) the Company is not and, after giving effect to the offering
and sale of the Securities and the application of the proceeds
23
thereof as described in the Final Memorandum, will not be an
"investment company" required to be registered under the Investment
Company Act without taking account of any exemption arising out of the
number of holders of the Company's securities; and
(x) assuming the transfer of the Pledged Securities to the
Trustee in accordance with the provisions of the Security Agreement,
that each of the Trustee and the Securities Intermediary has full
power, authority and legal right to enter into and perform its
obligations thereunder, and, in the case of Clause (B) below, (w) that
at the time of (and immediately preceding) the transfer by the Company
to the Securities Intermediary of any property or assets for deposit
or credit to the Security Account, the Company will have rights in
such property or assets (including, to the extent applicable, rights
within the meaning of Sections 1-201 and 9-203 of the Uniform
Commercial Code as in effect from time to time in the State of New
York), which shall suffice for the grant, creation and attachment of a
valid and effective security interest in such property and assets in
favor of the Trustee, the representations and warranties of the
Trustee and the Securities Intermediary contained in the Security
Agreement are true and correct, the Security Agreement and the
Indenture, and no other agreement or understanding, governs the
duties, obligations and rights of the Trustee and the Securities
Intermediary with respect to the Security Account, and compliance with
the agreements contained therein by the Company, the Trustee and the
Securities Intermediary, then, (A) the Security Agreement constitutes
a valid and legally binding agreement of the Company, enforceable
against the Company in accordance with its terms (subject to
applicable bankruptcy, reorganization, insolvency, moratorium or other
laws affecting creditors' rights generally from time to time in effect
and to general principles of equity, subject to the additional
qualification that certain remedial provisions of the Security
Agreement are or may be unenforceable in whole or in part under the
laws of the State of New York, but the inclusion of such provisions
does not make the remedies afforded by the Security Agreement
inadequate for the practical realization of the rights and benefits
purported to be provided thereby except for the economic consequences
resulting from any delay imposed by, or any procedure required by,
applicable New York laws, rules, regulations, and court decisions and
by constitutional requirements in and of the State of New York, and
except that such
24
counsel does not express any opinion as to the enforceability of any
provisions contained in the Security Agreement that constitute waivers
which are prohibited under the Uniform Commercial Code as in effect
from time to time in the State of New York) and (B) upon issuance of
the Notes against payment of the purchase price therefor, the Security
Agreement will create a valid and perfected security interest in the
security entitlement in each item Pledged Collateral (as defined in
the Security Agreement) that consists of Financial Assets (as defined
in the Security Agreement) based on United States Treasury Securities
maintained in TRADES (as defined in 31 C.F.R. 357.2) that are credited
to the Security Account (as defined in the Security Agreement)
securing the Obligations (as defined in the Security Agreement) in
effect on the date of such counsel's opinion. Except as specifically
set forth in this paragraph, such counsel shall express no opinion as
to the perfection of any security interest and as to the priority of
any security interest.
In rendering such opinion, such counsel may rely (A) as to matters
involving the application of laws of any jurisdiction other than the State of
New York, the Federal laws of the United States or the General Corporation Law
of the State of Delaware, to the extent they deem proper and specified in such
opinion, upon the opinion of other counsel of good standing whom they believe to
be reliable and who are reasonably satisfactory to counsel for the Initial
Purchasers; and (B) as to matters of fact, to the extent they deem proper, on
certificates of responsible officers of the Company and public officials.
References to the Final Memorandum in this Section 6(b) include any amendment or
supplement thereto at the Closing Date.
(c) The Company shall have furnished to the Representatives the
opinion of Xxxxxxx Berlin Shereff Xxxxxxxx, LLP, special U.S. regulatory
counsel for the Company, dated the Closing Date, to the effect that:
(i) to the extent they constitute a summary of the regulatory
matters referred to therein, the statements in the Final Memorandum
under the captions "Risk Factors--Extensive Regulation" and
"Business--Regulation" (to the extent that it relates to regulation
under U.S. law) fairly summarize the matters referred to therein;
25
(ii) neither the execution and delivery of the Purchase Agreement
by the Company nor the performance by the Company of its obligations
under the Purchase Agreement will violate the Communications Act or
the State Telecommunications Laws.
(iii) to the knowledge of such counsel, after due inquiry, (A)
the Company and the Subsidiaries have in effect all the
telecommunications regulatory licenses, permits, authorizations,
consents and approvals required to conduct their respective businesses
as presently conducted; (B) all such licenses, permits,
authorizations, consents and approvals have been duly and validly
issued and are in full force and effect; (C) the Company and the
Subsidiaries are not in violation of any such licenses, permits,
authorizations, consents or approvals; and (D) no proceedings to
revoke or restrict any such licenses, permits, authorizations,
consents or approvals are pending or threatened.
In rendering such opinion, such counsel may state that they express no
opinion as to the laws of any jurisdiction outside the United States.
(d) The Company shall have furnished to the Representatives the
opinion of Xxxxx & XxXxxxxx, special regulatory counsel for the Company,
dated the Closing Date, to the effect that:
(i) to the extent they constitute a summary of the regulatory
matters referred to therein, the statements in the Final Memorandum
under the caption "Business--Regulation of International Operations"
fairly summarize the matters referred to therein;
(ii) no licenses under telecommunications legislation in England
and Wales including the Telecommunications Xxx 0000, the Wireless
Xxxxxxxxxx Xxx 0000 or the Wireless Xxxxxxxxxx Xxx 0000 other than the
Licenses are required by the Company, ION LLC, ION or Racal to carry
on the ION Business in the United Kingdom;
(iii) except in relation to the ION Business, no licenses under
telecommunications legislation in England and Wales including the
Telecommunications Xxx 0000, the Wireless Xxxxxxxxxx Xxx 0000 or the
Wireless Xxxxxxxxxx Xxx 0000 are currently required by the
26
Company in relation to the Company's telecommunications business as
presently conducted in the UK; and
(iv) no German telecommunications licenses are currently required
by the Company in relation to the European Network, the German
Network, or the Company's telecommunications businesses as presently
conducted in Germany.
In rendering such opinion, such counsel may state that they express no
opinion as to the laws of any jurisdiction other than Germany or the United
Kingdom or the regulations of the European Union.
(e) The Representatives shall have received from Skadden, Arps, Slate,
Xxxxxxx & Xxxx LLP, counsel for the Initial Purchasers, such opinion or
opinions, dated the Closing Date, addressed to the Representatives, with
respect to the issuance and sale of the Securities, this Agreement, the
Indenture, the Registration Rights Agreement, the Final Memorandum (as
amended or supplemented at the Closing Date) and other related matters as
the Representatives may reasonably require, and the Company shall have
furnished to such counsel such documents as they reasonably request for the
purpose of enabling them to pass upon such matters.
(f) The Company shall have furnished to the Representatives a
certificate of the Company, signed by the Chairman of the Board of
Directors or the President and the principal financial or accounting
officer of the Company, dated the Closing Date, to the effect that the
signers of such certificate have carefully examined the Final Memorandum,
any amendment or supplement to the Final Memorandum and this Agreement and
that:
(i) the representations and warranties of the Company in this
Agreement are true and correct in all material respects on and as of
the Closing Date with the same effect as if made on the Closing Date,
and the Company has complied with all the agreements and satisfied all
the conditions on its part to be performed or satisfied hereunder at
or prior to the Closing Date; and
(ii) since the date of the most recent financial statements
included in the Final Memorandum (exclusive of any amendment or
supplement thereto), there has been no material adverse change in the
condition (financial or otherwise), prospects, earnings, business or
properties of the Company and its subsidiaries, taken as a whole,
whether or not arising from transactions in the ordinary course of
business, except as set forth in or contemplated by the Final
Memorandum (exclusive of any amendment or supplement thereto).
27
(g) At the Execution Time and at the Closing Date, the Company shall
have requested and caused Ernst & Young LLP to furnish to the
Representatives letters, dated respectively as of the Execution Time and as
of the Closing Date, in form and substance satisfactory to the
Representatives, confirming that they are independent accountants within
the meaning of the Act and the Exchange Act and the applicable rules and
regulations thereunder, that they have performed a review of the unaudited
interim financial information of the Company for the nine-month period
ended September 30, 1998 and as at September 30, 1998 and stating in effect
that:
(i) in their opinion the audited financial statements and
financial statement schedules included or incorporated in the Final
Memorandum and reported on by them comply as to form in all material
respects with the applicable accounting requirements of the Exchange
Act and the related published rules and regulations thereunder;
(ii) on the basis of a reading of the latest unaudited financial
statements made available by the Company and its subsidiaries; their
limited review in accordance with the standards established under
Statement on Auditing Standards No. 71, of the unaudited interim
financial information for the nine-month period ended September 30,
1998 and as at September 30, 1998, as indicated in their report
included or incorporated in the Final Memorandum; carrying out certain
specified procedures (but not an examination in accordance with
generally accepted auditing standards) which would not necessarily
reveal matters of significance with respect to the comments set forth
in such letter; a reading of the minutes of the meetings of the
stockholders, directors and committees of the Company and the
Subsidiaries; and inquiries of certain officials of the Company who
have responsibility for financial and accounting matters of the
Company and its subsidiaries as to transactions and events subsequent
to December 31, 1997, nothing came to their attention which caused
them to believe that:
(1) any unaudited financial statements included or
incorporated in the Final Memorandum do not comply in form in all
material respects with applicable accounting requirements and
with the published rules and regulations of the Commission with
respect to financial statements included or incorporated in
quarterly reports on Form 10-Q under the Exchange Act; or that
said unaudited financial statements are not in conformity with
generally accepted accounting
28
principles applied on a basis substantially consistent with that
of the audited financial statements included or incorporated in
the Final Memorandum; or
(2) with respect to the period subsequent to September 30,
1998, there were any changes, at a specified date not more than
three days prior to the date of the letter, in the capital stock,
increase in long-term debt of the Company and its subsidiaries or
decreases in net assets or stockholders' equity of the Company as
compared with the amounts shown on the September 30, 1998
consolidated balance sheet included in the Final Memorandum, or
for the period from October 1, 1998 to such specified date there
were any decreases, as compared with the corresponding period in
the preceding year in revenues or in total or per share amounts
of net income of the Company and its subsidiaries, except in all
instances for changes or decreases set forth in such letter, in
which case the letter shall be accompanied by an explanation by
the Company as to the significance thereof unless said
explanation is not deemed necessary by the Representatives; or
(3) the information included under the headings "Selected
Consolidated Financial Data" and "Management--Executive
Compensation" is not in conformity with the disclosure
requirements of Regulation S-K; and
(iii) they have performed certain other specified procedures as a
result of which they determined that certain information of an
accounting, financial or statistical nature (which is limited to
accounting, financial or statistical information derived from the
general accounting records of the Company and its subsidiaries) set
forth in the Final Memorandum, including the information set forth
under the captions "Summary," "Risk Factors," "Use of Proceeds,"
"Capitalization," "Selected Consolidated Financial Data,"
"Management's Discussion and Analysis of Financial Condition and
Results of Operations," "Business," "Management," and "Certain
Relationships and Related Transactions" in the Final Memorandum, the
information included or incorporated in Items 1, 2, 6, 7 and 11 of the
Company's Annual Report on Form 10-K incorporated in the Final
Memorandum and the information included in the "Management's
Discussion and Analysis of Financial Condition and Results of
Operations" included or incorporated in the Company's Quarterly
29
Reports on Form 10-Q, incorporated in the Final Memorandum agrees with
the accounting records of the Company and its subsidiaries, excluding
any questions of legal interpretation.
References to the Final Memorandum in this Section 6(g) include both
the Final Memorandum as of the Execution Time and any amendment or supplement
thereto at the date of the applicable letter.
(h) At the Execution Time and at the Closing Date, X.X. Xxxxxx & Co.
LLP shall have furnished to the Representatives letters, dated respectively
as of the Execution Time and as of the Closing Date, in form and substance
satisfactory to the Representatives, confirming that they are independent
accountants within the meaning of the Act and the applicable rules and
regulations thereunder, and stating in effect that:
(i) in their opinion the audited financial statements and
financial statement schedules included in the Final Memorandum and
reported on by them comply in form in all material respects with the
applicable accounting requirements of the Act and the related
published rules and regulations; and
(ii) they have performed certain other specified procedures as a
result of which they determined that certain information of an
accounting, financial or statistical nature (which is limited to
accounting, financial or statistical information derived from the
general accounting records of the Company and its subsidiaries) set
forth in the Final Memorandum agrees with the accounting records of
the Company and its subsidiaries, excluding any questions of legal
interpretation.
References to the Final Memorandum in this Section 6(h) include both
the Final Memorandum as of the Execution Time and any amendment or supplement
thereto at the date of the applicable letter.
(i) Subsequent to the Execution Time or, if earlier, the dates as of
which information is given in the Final Memorandum (exclusive of any
amendment or supplement thereto), there shall not have been (i) any change
or decrease specified in the letter or letters referred to in paragraph (g)
of this Section 6; or (ii) any change, or any development involving a
prospective change, in or affecting the condition (financial or otherwise),
prospects, earnings, business or properties of the Company and its
subsidiaries, taken as a whole, whether or not arising from transactions in
the ordinary course of business, except as set forth in or contemplated in
the Final Memorandum (exclusive of any amendment or supplement thereto) the
effect of which, in
30
any case referred to in clause (i) or (ii) above, is, in the sole
judgment of the Representatives, so material and adverse as to make it
impractical or inadvisable to market the Securities as contemplated by the
Final Memorandum (exclusive of any amendment or supplement thereto).
(j) The Securities shall have been designated as PORTAL-eligible
securities in accordance with the rules and regulations of the NASD, and
the Securities shall be eligible for clearance and settlement through The
Depositary Trust Company.
(k) Subsequent to the Execution Time, there shall not have been any
decrease in the rating of any of the Company's debt securities, including
the Securities, by any "nationally recognized statistical rating
organization" (as defined for purposes of Rule 436(g) under the Act) or any
notice given of any intended or potential decrease in any such rating or of
a possible change in any such rating that does not indicate the direction
of the possible change.
(l) The Initial Purchasers shall have received an executed counterpart
of the Registration Rights Agreement which shall have been executed and
delivered by a duly authorized officer of the Company.
(m) Prior to the Closing Date, the Company shall have furnished to the
Representatives such further information, certificates and documents as the
Representatives may reasonably request.
(n) The Company shall not have failed, on or prior to the Closing
Date, to perform or comply with any of the agreements herein contained and
required to be performed or complied with by the Company on or prior to
such date.
If any of the conditions specified in this Section 6 shall not have
been fulfilled in all material respects when and as provided in this Agreement,
or if any of the opinions and certificates mentioned above or elsewhere in this
Agreement shall not be in all material respects reasonably satisfactory in form
and substance to the Representatives and counsel for the Initial Purchasers,
this Agreement and all obligations of the Initial Purchasers hereunder may be
cancelled at, or at any time prior to, the Closing Date by the Representatives.
Notice of such cancellation shall be given to the Company in writing or by
telephone or facsimile confirmed in writing.
The documents required to be delivered by this Section 6 will be
delivered at the office of counsel for the Initial Purchasers, at 000 Xxxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, on the Closing Date.
31
7. Reimbursement of Expenses. If the sale of the Securities provided
for herein is not consummated because any condition to the obligations of the
Initial Purchasers set forth in Section 6 hereof is not satisfied, because of
any termination pursuant to Section 10 hereof or because of any refusal,
inability or failure on the part of the Company to perform any agreement herein
or comply with any provision hereof other than by reason of a default by any of
the Initial Purchasers, the Company will reimburse the Initial Purchasers
severally through Xxxxxxx Xxxxx Barney on demand for all out-of-pocket expenses
(including reasonable fees and disbursements of one counsel) that shall have
been incurred by them in connection with the proposed purchase and sale of the
Securities.
8. Indemnification and Contribution. (a) The Company agrees to
indemnify and hold harmless each Initial Purchaser, the directors, officers,
employees and agents of each Initial Purchaser and each person who controls any
Initial Purchaser with the meaning of either the Act or the Exchange Act against
any and all losses, claims, damages or liabilities, joint or several, to which
they or any of them may become subject under the Act, the Exchange Act or other
Federal or state statutory law or regulation, at common law or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon any untrue statement or alleged untrue
statement of a material fact contained in the Preliminary Memorandum, the Final
Memorandum (or in any supplement or amendment thereto) or any information
provided by the Company to any holder or prospective purchaser of Securities
pursuant to Section 5(h), or in any amendment thereof or supplement thereto, or
arise out of or are based upon the omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, and agrees to reimburse each such indemnified party, as
incurred, for any legal or other expenses reasonably incurred by them in
connection with investigating or defending any such loss, claim, damage,
liability or action; provided, however, that (i) the Company will not be liable
in any such case to the extent that any such loss, claim, damage or liability
arises out of or is based upon any such untrue statement or alleged untrue
statement or omission or alleged omission made in the Preliminary Memorandum or
the Final Memorandum, or in any amendment thereof or supplement thereto, in
reliance upon and in conformity with written information furnished to the
Company by or on behalf of any Initial Purchasers through the Representatives
specifically for inclusion therein and (ii) with respect to any untrue statement
or alleged untrue statement of, or omission or alleged omission to state, a
material fact made in the Preliminary Memorandum, the indemnity agreement
contained in this Section 8(a) shall not inure to the benefit of any Initial
Purchaser (or any of the directors, officers, employees and agents of such
Initial Purchaser or any controlling person of such Initial Purchaser) from whom
the person asserting any such loss, claim, damage or liability purchased the
Securities concerned, to the extent that any such loss, claim, damage or
liability of such Initial Purchaser occurs under the circumstances where it
shall
32
have been determined by a court of competent jurisdiction (or appropriate
arbitral proceeding) by final and nonappealable judgment that (w) the Company
had previously furnished copies of the Final Memorandum to the Initial
Purchasers, (x) delivery of the Final Memorandum was required by the Act or
under this Agreement to be made to such person, (y) the untrue statement or
omission of a material fact contained in the Preliminary Memorandum was
corrected in the Final Memorandum and (z) there was not sent or given to such
person, at or prior to the written confirmation of the sale of such Securities
to such person, a copy of the Final Memorandum. This indemnity agreement will be
in addition to any liability which the Company may otherwise have.
(b) Each Initial Purchaser severally and not jointly agrees to
indemnify and hold harmless the Company, each of its directors, each of its
officers, directors, employees, agents and each person who controls the
Company within the meaning of either the Act or the Exchange Act, to the
same extent as the foregoing indemnity from the Company to each Initial
Purchaser, but only with reference to written information relating to such
Initial Purchaser furnished to the Company by or on behalf of such Initial
Purchaser through the Representatives specifically for inclusion in the
Preliminary Memorandum or the Final Memorandum (or in any amendment or
supplement thereto). This indemnity agreement will be in addition to any
liability which any Initial Purchaser may otherwise have. The Company
acknowledges that the statements set forth in the last paragraph of the
cover page regarding the delivery of the Securities, the legend on page 4
concerning stabilization, syndicate covering transactions and penalty bids
and the third and tenth paragraphs under the heading "Plan of Distribution"
in the Preliminary Memorandum and the Final Memorandum, constitute the only
information furnished in writing by or on behalf of the Initial Purchasers
for inclusion in the Preliminary Memorandum or the Final Memorandum (or in
any amendment or supplement thereto).
(c) Promptly after receipt by an indemnified party under this Section
8 of notice of the commencement of any action, such indemnified party will,
if a claim in respect thereof is to be made against the indemnifying party
under this Section 8, notify the indemnifying party in writing of the
commencement thereof, but the failure so to notify the indemnifying party
(i) will not relieve it from liability under paragraph (a) or (b) above
unless and to the extent it did not otherwise learn of such action and such
failure results in the forfeiture by the indemnifying party of substantial
rights and defenses as determined by a court of competent jurisdiction; and
(ii) will not, in any event, relieve the indemnifying party from any
obligations to any indemnified party other than the indemnification
obligation provided in paragraph (a) or (b) above. The indemnifying party
shall be entitled to assume the defense of such action and appoint counsel
of the indemnifying
33
party's choice at the indemnifying party's expense to represent the
indemnified party in any action for which indemnification is sought (in
which case the indemnifying party shall not thereafter be responsible for
the fees and expenses of any separate counsel retained by the indemnified
party or parties except as set forth below); provided, however, that such
counsel shall be reasonably satisfactory to the indemnified party.
Notwithstanding the indemnifying party's election to assume the defense of
such action or appoint counsel to represent the indemnified party in an
action, the indemnified party shall have the right to employ separate
counsel (including local counsel), and the indemnifying party shall bear
the reasonable fees, costs and expenses of such separate counsel if (i) the
use of counsel chosen by the indemnifying party to represent the
indemnified party would present such counsel with a conflict of interest,
which has not been waived; (ii) the actual or potential defendants in, or
targets of, any such action include both the indemnified party and the
indemnifying party and the indemnified party shall have been reasonably
advised by such counsel that there are legal defenses available to it
and/or other indemnified parties which are different from or additional to
those available to the indemnifying party; (iii) the indemnifying party
shall not have assumed the defense of the action or employed counsel
reasonably satisfactory to the indemnified party to represent the
indemnified party within a reasonable time after notice of the institution
of such action; or (iv) the indemnifying party shall authorize the
indemnified party to employ separate counsel at the expense of the
indemnifying party. In any such case, the indemnifying party shall not, in
connection with any one action or separate but substantially similar
related actions in the same jurisdiction arising out of the same general
allegations or circumstances, be liable for the fees and expenses of more
than one separate firm of attorneys (in addition to any local counsel) for
all indemnified parties. An indemnifying party will not, without the prior
written consent of the indemnified parties, settle or compromise or consent
to the entry of any judgment with respect to any pending or threatened
claim, action, suit or proceeding in respect of which indemnification or
contribution may be sought hereunder (whether or not the indemnified
parties are actual or potential parties to such claim or action) unless
such settlement, compromise or consent includes an unconditional release of
each indemnified party from all liability arising out of such claim,
action, suit or proceeding.
(d) In the event that the indemnity provided in paragraph (a) or (b)
of this Section 8 is unavailable to or insufficient to hold harmless an
indemnified party for any reason, the Company and the Initial Purchasers
agree to contribute to the aggregate losses, claims, damages and
liabilities (including legal or other expenses reasonably incurred in
connection with investigating or defending same) (collectively "Losses") to
which the Company and one or more of the Initial Purchasers may be subject
in such
34
proportion as is appropriate to reflect the relative benefits received by
the Company on the one hand and by the Initial Purchasers on the other from
the offering of the Securities; provided, however, that in no case shall
any Initial Purchaser (except as may be provided in any agreement among the
Initial Purchasers relating to the offering of the Securities) be
responsible for any amount in excess of the purchase discount or commission
applicable to the Securities purchased by such Initial Purchaser hereunder.
If the allocation provided by the immediately preceding sentence is
unavailable for any reason, the Company and the Initial Purchasers shall
contribute in such proportion as is appropriate to reflect not only such
relative benefits but also the relative fault of the Company on the one
hand and of the Initial Purchasers on the other in connection with the
statements or omissions or alleged statements or omissions which resulted
in such Losses, as well as any other relevant equitable considerations.
Benefits received by the Company shall be deemed to be equal to the total
net proceeds from the offering (before deducting expenses) received by it,
and benefits received by the Initial Purchasers shall be deemed to be equal
to the total purchase discounts and commissions in each case set forth on
the cover of the Final Memorandum. Relative fault shall be determined by
reference to, among other things, whether any untrue or any alleged untrue
statement of a material fact or the omission or alleged omission to state a
material fact relates to information provided by the Company on the one
hand or the Initial Purchasers on the other, the intent of the parties and
their relative knowledge, information and opportunity to correct or prevent
such untrue statement or omission or alleged untrue statement or omission.
The Company and the Initial Purchasers agree that it would not be just and
equitable if contribution were determined by pro rata allocation or any
other method of allocation which does not take account of the equitable
considerations referred to above. Notwithstanding the provisions of this
paragraph (d), no person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. For
purposes of this Section 8, each person who controls an Initial Purchaser
within the meaning of either the Act or the Exchange Act and each director,
officer, employee and agent of an Initial Purchaser shall have the same
rights to contribution as such Initial Purchaser, and each person who
controls the Company within the meaning of either the Act or the Exchange
Act and each officer and, director, employee and agent of the Company shall
have the same rights to contribution as the Company, subject in each case
to the applicable terms and conditions of this paragraph (d).
9. Default by an Initial Purchaser. If any one or more Initial
Purchasers shall fail to purchase and pay for any of the Securities agreed to be
purchased by such Initial Purchaser hereunder and such failure to purchase shall
35
constitute a default in the performance of its or their obligations under this
Agreement, the remaining Initial Purchasers shall be obligated severally to take
up and pay for (in the respective proportions which the amount of Securities set
forth opposite their names in Schedule I hereto bears to the aggregate amount of
Securities set forth opposite the names of all the remaining Initial Purchasers)
the Securities which the defaulting Initial Purchaser or Initial Purchasers
agreed but failed to purchase; provided, however, that in the event that the
aggregate amount of Securities which the defaulting Initial Purchaser or Initial
Purchasers agreed but failed to purchase shall exceed 10% of the aggregate
amount of Securities set forth in Schedule I hereto, the remaining Initial
Purchasers shall have the right to (i) make arrangements for the purchase of the
Securities which such defaulting Initial Purchaser or Initial Purchasers agreed
but failed to purchase by other persons satisfactory to the Company and the
non-defaulting Initial Purchasers, and/or (ii) purchase all, but shall not be
under any obligation to purchase any, of the Securities, and if such
nondefaulting Initial Purchasers do not make such arrangements and/or purchase
all the Securities, this Agreement will terminate without liability to any
nondefaulting Initial Purchaser or the Company. In the event of a default by any
Initial Purchaser as set forth in this Section 9, the Closing Date shall be
postponed for such period, not exceeding five Business Days, as the
Representatives shall determine in order that the required changes in the Final
Memorandum or in any other documents or arrangements may be effected. Nothing
contained in this Agreement shall relieve any defaulting Initial Purchaser of
its liability, if any, to the Company or any nondefaulting Initial Purchaser for
damages occasioned by its default hereunder.
10. Termination. This Agreement shall be subject to termination in the
absolute discretion of the Representatives, by notice given to the Company prior
to delivery of and payment for the Securities, if at any time prior to such time
(i) trading in the Company's Common Stock shall have been suspended by the
Commission or the NASDAQ National Market or trading in securities generally on
the New York Stock Exchange or the NASDAQ National Market shall have been
suspended or limited or minimum prices shall have been established on such
Exchange or the NASDAQ National Market; (ii) a banking moratorium shall have
been declared either by Federal or New York State authorities; or (iii) there
shall have occurred any outbreak or escalation of hostilities, declaration by
the United States of a national emergency or war or other calamity or crisis the
effect of which on financial markets is such as to make it, in the sole judgment
of the Representatives, impracticable or inadvisable to proceed with the
offering or delivery of the Securities as contemplated by the Final Memorandum
(exclusive of any amendment or supplement thereto).
11. Representations and Indemnities to Survive. The respective
agreements, representations, warranties, indemnities and other statements of the
Company or its officers and of the Initial Purchasers set forth in or made
pursuant to
36
this Agreement will remain in full force and effect, regardless of any
investigation made by or on behalf of the Initial Purchasers or the Company or
any of the officers, directors, employees, agents or controlling persons
referred to in Section 8 hereof, and will survive delivery of and payment for
the Securities. The provisions of Sections 7 and 8 hereof shall survive the
termination or cancellation of this Agreement.
12. Notices. All communications hereunder will be in writing and
effective only on receipt, and, if sent to the Representatives, will be mailed,
delivered or telefaxed to the Xxxxxxx Xxxxx Xxxxxx General Counsel (fax no.:
(000) 000-0000) and confirmed to the General Counsel, Xxxxxxx Xxxxx Barney at
000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 Attention: General Counsel; or,
if sent to the Company, will be mailed, delivered or telefaxed to Metromedia
Fiber Network Services, Inc. c/o Metromedia Fiber Network, Inc., Xxx Xxxxx
Xxxxxxxxx Xxxxxx, Xxxxx Xxxxxx, Xxx Xxxx 00000, attention: Chief Financial
Officer (fax no.: (000) 000-0000) and confirmed to it at Metromedia Company, Xxx
Xxxxxxxxxxx Xxxxx, Xxxx Xxxxxxxxxx, Xxx Xxxxxx 00000-0000, attention: General
Counsel (fax no.: (000) 000-0000) and 000 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000, attention: Executive Vice President (fax no.: (000) 000-0000).
13. Successors. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective successors and the officers
and directors and controlling persons referred to in Section 8 hereof, and,
except as expressly set forth in Section 5(h) or Section 8 hereof, no other
person will have any right or obligation hereunder.
14. Applicable Law. This Agreement will be governed by and construed
in accordance with the laws of the State of New York applicable to contracts
made and to be performed within the State of New York.
15. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same instrument.
16. Headings. The section headings used herein are for convenience
only and shall not affect the construction hereof.
17. Definitions. The terms which follow, when used in this Agreement,
shall have the meanings indicated.
"Act" shall mean the Securities Act of 1933, as amended, and the rules
and regulations of the Commission promulgated thereunder.
37
"Affiliate" shall have the meaning specified in Rule 501 (b) of
Regulation D.
"Business Day" shall mean any day other than a Saturday, a Sunday or a
legal holiday or a day on which banking institutions or trust
companies are authorized or obligated by law to close in The City of
New York.
"Commission" shall mean the Securities and Exchange Commission.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the Commission promulgated
thereunder.
"Execution Time" shall mean the date and time that this Agreement is
executed and delivered by the parties hereto.
"Investment Company Act" shall mean the Investment Company Act of
1940, as amended, and the rules and regulations of the Commission
promulgated thereunder.
"NASD" shall mean the National Association of Securities Dealers, Inc.
"Regulation D" shall mean Regulation D under the Act.
"Regulation S" shall mean Regulation S under the Act.
"Trust Indenture Act" shall mean the Trust Indenture Act of 1939, as
amended, and the rules and regulations of the Commission promulgated
thereunder.
38
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicate hereof, whereupon
this Agreement and your acceptance shall represent a binding agreement between
the Company and the several Initial Purchasers.
Very truly yours,
Metromedia Fiber Network, Inc.
By
----------------------------------------
Name:
Title:
The foregoing Agreement is hereby
confirmed and accepted as of the
date first above written.
Xxxxxxx Xxxxx Xxxxxx Inc.
Xxxxx Securities Inc.
Deutsche Bank Securities Inc.
Xxxxxxxxx, Lufkin & Xxxxxxxx Securities Corporation
By: Xxxxxxx Xxxxx Barney Inc.
By /s/ Xxxxxxx X. Xxxxxxxxxx
-----------------------------
Name: Xxxxxxx X. Xxxxxxxxxx
Title: Managing Director
For themselves and the other several
Initial Purchasers named in Schedule I
to the foregoing Agreement.
SCHEDULE I
Principal Amount of
Securities
Initial Purchasers to be Purchased
------------------ -------------------
Xxxxxxx Xxxxx Xxxxxx Inc. .............................................. $ 260,000,000
Chase Securities Inc.................................................... 130,000,000
Deutsche Bank Securities Inc............................................ 130,000,000
Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities Corporation..................... 130,000,000
-------------
Total ................................................ $ 650,000,000
SCHEDULE II
Subsidiaries
Metromedia Fiber Network Services, Inc.
Metromedia Fiber Network of Illinois, Inc.
Metromedia Fiber Network-NYC, Inc.
Metromedia Fiber Network of New Jersey, Inc.
MFN of VA, L.L.C.
MFN Purchasing, Inc.
EXHIBIT A
Selling Restrictions for Offers
Sales outside the United States
1. The Securities have not been and will not be registered under the
Act and may not be offered or sold within the United States or to, or for the
account or benefit of, U.S. persons except in accordance with Regulation S under
the Act or pursuant to an exemption from the registration requirements of the
Act. Each Initial Purchaser represents and agrees that, except as otherwise
permitted by Section 4(a)(i) of the Agreement to which this is an exhibit, it
has offered and sold the Securities, and will offer and sell the Securities, (i)
as part of their distribution at any time; and (ii) otherwise until 40 days
after the later of the commencement of the offering and the Closing Date, only
in accordance with Rule 903 of Regulation S under the Act. Accordingly, each
Initial Purchaser represents and agrees that neither it, nor any of its
Affiliates nor any person acting on its or their behalf has engaged or will
engage in any directed selling efforts with respect to the Securities, and that
it and they have complied and will comply with the offering restrictions
requirement of Regulation S. Each Initial Purchaser agrees that, at or prior to
the confirmation of sale of Securities (other than a sale of Securities pursuant
to Section 4(a)(i) of the Agreement to which this is an exhibit), it shall have
sent to each distributor, dealer or person receiving a selling concession, fee
or other remuneration that purchases Securities from it during the distribution
compliance period a confirmation or notice to substantially the following
effect:
"The Securities covered hereby have not been registered under the U.S.
Securities Act of 1933, as amended, and the rules and regulations
promulgated thereunder (the "Act"') and may not be offered or sold
within the United States or to, or for the account or benefit of, U.S.
persons (i) as part of their distribution at any time or (ii)
otherwise until 40 days after the later of the commencement of the
offering of the Securities and November 25, 1998, except in either
case in accordance with Regulation S or Rule 144A under the Act. Terms
used above have the meanings given to them by Regulation S."
(a) Each Initial Purchaser also represents and agrees that it has not
entered and will not enter into any contractual arrangement with any
distributor with respect to the distribution of the Securities, except with
its Affiliates or with the prior written consent of the Company.
(b) Terms used in this section and defined in Regulation S have the
meanings given to them by Regulation S.
2. Each Initial Purchaser represents and agrees that (i) it has not
offered or sold, and will not offer or sell, in the United Kingdom, by means of
any document, any Securities other than to persons whose ordinary business it is
to buy, hold, manage or sell shares or debentures, whether as principal or as
agent (except in circumstances which do not constitute an offer to the public
within the meaning of the Public Offers of Securities Regulations 1995); (ii) it
has complied and will comply with all applicable provisions of the Financial
Services Xxx 0000 of the United Kingdom with respect to anything done by it in
relation to the Securities in, from or otherwise involving the United Kingdom;
and (iii) it has only issued or passed on and will only issue or pass on in the
United Kingdom any document received by it in connection with the issue of the
Securities to a person who is of a kind described in Article 11(3) of the
Financial Services Xxx 0000 (Investment Advertisements) (Exemptions) Order 1996
or is a person to whom the document may otherwise lawfully be issued or passed
on.
