EXHIBIT 99.2
EXCHANGE AGENT AGREEMENT
May 6, 1998
Wilmington Trust Company
Corporate Trust Administration
Xxxxxx Square North
0000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000-0000
Attention: Xxxxx Xxxxxx
Ladies and Gentlemen:
PSINet Inc., a New York corporation ("the Company"), proposes to make an
offer (the "Exchange Offer") to exchange its 10% Senior Notes Due 2005, Series B
(the "Exchange Notes") which the Company expects to be registered under the
Securities Act of 1933, as amended, for its 10% Senior Notes Due 2005, Series A
(the "Initial Notes"). The terms and conditions of the Exchange Offer as
currently contemplated are set forth in a prospectus, to be dated on or about
May 7, 1998 (the "Prospectus"), proposed to be distributed to all record holders
of the Initial Notes. The Initial Notes and the Exchange Notes are collectively
referred to herein as the "Notes."
The Company hereby appoints Wilmington Trust Company to act as exchange
agent (the "Exchange Agent") in connection with the Exchange Offer. References
hereinafter to "you" shall refer to Wilmington Trust Company.
The Exchange Offer is expected to be commenced by the Company on or about
May 7, 1998. The Letter of Transmittal accompanying the Prospectus (or in the
case of book entry securities, The Depository Trust Company's Automatic Tender
Offer Program ("ATOP") system) is to be used by the holders of the Initial Notes
to accept the Exchange Offer and contains instructions with respect to the
delivery of certificates for Initial Notes tendered in connection therewith.
The Exchange Offer shall expire at 5:00 P.M., New York City time, on June
8, 1998, or on such later date or time to which the Company may extend the
Exchange Offer (the "Expiration Date"). Subject to the terms and conditions set
forth in the Prospectus under the caption "The Exchange Offer--Expiration Date;
Extensions; Amendments," the Company expressly reserves the right to extend the
Exchange Offer from time to time and may extend the Exchange Offer by giving
oral (confirmed in writing within 24 hours) or written notice to you before 9:00
A.M., New York City time, on the business day following the previously scheduled
Expiration Date.
The Company expressly reserves the right to amend or terminate the Exchange
Offer, and not to accept for exchange any Initial Notes not theretofore accepted
for exchange, upon the occurrence of any of the conditions of the Exchange Offer
specified in the Prospectus under the
caption "The Exchange Offer -- Conditions." The Company will give oral
(confirmed in writing) or written notice of any amendment, termination or
nonacceptance to you as promptly as practicable.
In carrying out your duties as Exchange Agent, you are to act in accordance
with the following instructions:
1. You will perform such duties and only such duties as are specifically
set forth herein.
2. You will establish an account with respect to the Initial Notes at The
Depository Trust Company (the "DTC") for purposes of the Exchange Offer promptly
after the date of the Prospectus, and any financial institution that is a
participant in the DTC's system may make book-entry delivery of the Initial
Notes by causing the DTC to transfer such Initial Notes into your account in
accordance with the DTC's procedure for such transfer.
3. You are to examine each of the Letters of Transmittal and certificates
for Initial Notes (or confirmation of book-entry transfer into your account at
the DTC) and any other documents delivered or mailed to you by or for holders of
the Initial Notes to ascertain whether: (i) the Letters of Transmittal and any
such other documents are executed and properly completed in accordance with
instructions set forth therein and (ii) the Initial Notes have otherwise been
properly tendered. In each case where the Letter of Transmittal or any other
document has been improperly completed or executed or any of the certificates
for Initial Notes are not in proper form for transfer or some other irregularity
in connection with the acceptance of the Exchange Offer exists, you will use
reasonable efforts to inform the presenters thereof of the need for fulfillment
of all requirements and for such presenters to take any other action as may be
necessary or advisable to cause such irregularity to be corrected.
4. With the approval of Xxxxxx X. Postal or Xxxxxxx X. Xxxxxxxxx of the
Company (such approval, if given orally, to be confirmed in writing) or any
other party designated by such officers in writing, you are authorized to waive
any irregularities in connection with any tender of Initial Notes pursuant to
the Exchange Offer.
5. Tenders of Initial Notes may be made only as set forth in the Letter of
Transmittal and in the section of the Prospectus captioned "The Exchange Offer -
- Procedures for Tendering Initial Notes," and Initial Notes shall be considered
properly tendered to you only when tendered in accordance with the procedures
set forth therein.
Notwithstanding the provisions of this paragraph 5, Initial Notes which
Xxxxxx X. Postal or Xxxxxxx X. Xxxxxxxxx of the Company shall approve as having
been properly tendered shall be considered to be properly tendered (such
approval, if given orally, shall be confirmed in writing).
6. You shall advise the Company with respect to any Initial Notes received
subsequent to the Expiration Date and accept its instructions with respect to
disposition of such Initial Notes.
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7. You shall accept tenders:
(a) in cases where the Initial Notes are registered in two
or more names only if signed by all named holders;
(b) in cases where the signing person (as indicated on the
Letter of Transmittal) is acting in a fiduciary or a representative
capacity only when proper evidence of his or her authority so to act is
submitted, unless such requirement is waived by the Company; and
(c) from persons other than the registered holder of Initial
Notes provided that customary transfer requirements, including any
applicable transfer taxes, are fulfilled.
You shall accept partial tenders of Initial Notes where so indicated,
and as permitted in the Letter of Transmittal, and deliver certificates for
Initial Notes to the transfer agent for split-up and return any untendered
Initial Notes to the holder (or such other person as may be designated in the
Letter of Transmittal) as promptly as practicable after expiration or
termination of the Exchange Offer.
8. Upon satisfaction or waiver of all of the conditions to the Exchange
Offer, the Company will notify you (such notice if given orally, to be promptly
confirmed in writing) of its acceptance, promptly after the Expiration Date, of
all Initial Notes properly tendered and you, on behalf of the Company, will
exchange such Initial Notes for Exchange Notes and cause such Initial Notes to
be canceled. Delivery of Exchange Notes will be made on behalf of the Company by
you at the rate of $1,000 principal amount of Exchange Notes for each $1,000
principal amount of Initial Notes tendered promptly after notice (such notice if
given orally, to be promptly confirmed in writing) of acceptance of said Initial
Notes by the Company; provided, however, that in all cases, Initial Notes
tendered pursuant to the Exchange Offer will be exchanged only after timely
receipt by you of certificates for such Initial Notes (or confirmation of book-
entry transfer into your account at the DTC), a properly completed and duly
executed Letter of Transmittal (or facsimile thereof) with any required
signature guarantees, and any other required documents. You shall issue Exchange
Notes only in denominations of $1,000 or any integral multiple thereof.
9. Tenders pursuant to the Exchange Offer are irrevocable, except that,
subject to the terms and upon the conditions set forth in the Prospectus under
the caption "Exchange Offer--Withdrawals of Tenders" and the Letter of
Transmittal, Initial Notes tendered pursuant to the Exchange Offer may be
withdrawn at any time prior to the Expiration Date.
10. The Company shall not be required to exchange any Initial Notes
tendered if any of the conditions set forth in the Exchange Offer are not met.
Notice of any decision by the Company not to exchange any Initial Notes tendered
shall be given (and, if orally, then promptly confirmed in writing) by the
Company to you.
11. If, pursuant to the Exchange Offer, the Company does not accept for
exchange all or part of the Initial Notes tendered because of an invalid tender,
the occurrence of certain other events set forth in the Prospectus under the
caption "The Exchange Offer--Conditions" or otherwise, you shall (as soon as
practicable after the expiration or termination of the Exchange
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Offer) return those certificates for unaccepted Initial Notes (or effect
appropriate book-entry transfer), together with any related required documents
and the Letters of Transmittal relating thereto that are in your possession, to
the persons who deposited them.
12. To the extent such Notes are evidenced by physical certificates, all
certificates for reissued Initial Notes, unaccepted Initial Notes or for
Exchange Notes shall be forwarded by first-class mail.
13. You are not authorized to pay or offer to pay any concessions,
commissions or solicitation fees to any broker, dealer, bank or other persons or
to engage or use any person to solicit tenders.
14. As Exchange Agent hereunder you:
(a) shall have no duties or obligations other than those
specifically set forth herein or as may be subsequently agreed to in
writing by you and the Company;
(b) will be regarded as making no representations and having
no responsibilities as to the validity, sufficiency, value or
genuineness of any of the certificates or the Initial Notes represented
thereby deposited with you pursuant to the Exchange Offer, and will not
be required to and will make no representation as to the validity,
value or genuineness of the Exchange Offer;
(c) shall not be obligated to take any legal action
hereunder which might, in your reasonable judgment, involve any expense
or liability, unless you shall have been furnished with reasonable
indemnity;
(d) may reasonably rely on, and shall be protected in acting
in reliance upon, any certificate, instrument, opinion, notice, order,
instruction (including any notice, order or instruction given orally),
letter, telegram or other document or security delivered to you and
reasonably believed by you to be genuine and to have been signed or
made by the proper party or parties;
(e) may reasonably act upon any tender, statement, request,
comment, agreement or other instrument whatsoever not only as to its
due execution and validity and effectiveness of its provisions, but
also as to the truth and accuracy of any information contained therein,
which you shall in good faith believe to be genuine or to have been
signed or represented by a proper person or persons;
(f) may rely on and shall be protected in acting upon
written or oral instructions from any officer of the Company;
(g) may consult with your counsel with respect to any
questions relating to your duties and responsibilities, and the advice
or opinion of such counsel shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted to be
taken by you hereunder in good faith and in accordance with the advice
or opinion of such counsel; and
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(h) shall not advise any person tendering Initial Notes
pursuant to the Exchange Offer as to the appropriateness of making such
tender or as to the market value or decline or appreciation in market
value of any Initial Notes.
15. You shall take such action as may from time to time be requested by the
Company or its counsel (and such other action as you may reasonably deem
appropriate) to furnish copies of the Prospectus, Letter of Transmittal and the
Notice of Guaranteed Delivery (as defined in the Prospectus) or such other forms
as may be approved from time to time by the Company, to all persons requesting
such documents and to accept and comply with telephone requests for information
relating to the Exchange Offer, provided that such information shall relate only
to the procedures for accepting (or withdrawing from) the Exchange Offer. The
Company will furnish you with copies of such documents at your request. All
other requests for information relating to the Exchange Offer shall be directed
to the Company, Attention: Xxxxxx X. Postal.
16. On each Business Day (or more frequently if requested) up to and
including the Expiration Date of the Exchange Offer, you shall advise by
telephone, not later than 5:00 p.m., Eastern time, at (000) 000-0000, Xxxxxx X.
Postal, Senior Vice President and Chief Financial Officer of the Company, and
such other person or persons as the Company may direct, as to the aggregate
principal amount of Initial Notes which have been duly tendered on such date,
stating separately: (i) the aggregate principal amount of Initial Notes that
have been duly tendered on such day; (ii) the aggregate principal amount of all
Initial Notes tendered by Notices of Guaranteed Delivery on such day; (iii) the
aggregate principal amount of Initial Notes tendered by book-entry transfer on
such day; (iv) the aggregate principal amount of Initial Notes tendered on such
days as to which you have questions concerning regularity; (v) the aggregate
principal amount of Initial Notes delivered which have been tendered previously
by Notices of Guaranteed Delivery; (vi) the aggregate principal amount of
Initial Notes that have been withdrawn that day; and (vii) the cumulative
aggregate principal amount of Initial Notes duly tendered (and not withdrawn)
through the time of such call. Promptly thereafter, by the next day if
possible, you shall confirm such advice to each of the above persons in writing,
to be transmitted by telecopier, pouch or other form of immediate or overnight
delivery. In addition, you shall cooperate in making available to Nixon,
Hargrave, Devans & Xxxxx LLP and to such other person or persons as may be
reasonably designated by the Company upon oral request made from time to time
prior to the Expiration Date, such information and such other information as any
of them may reasonably request regarding the Exchange Offer. Such cooperation
shall include, without limitation, the granting by you to the Company, and to
such other person or persons as the Company may request, of reasonable access to
those designated persons on your staff who are responsible for receiving
tenders, in order to ensure that immediately prior to the Expiration Date, the
Company shall have received information in sufficient detail to enable it to
make an informed judgment as to whether to extend the Exchange Offer.
17. Letters of Transmittal and Notices of Guaranteed Delivery shall be
stamped by you as to the date and the time of receipt thereof and shall be
preserved by you for a period of time at least equal to the period of time you
preserve other records pertaining to the transfer of securities. You shall
dispose of unused Letters of Transmittal and other surplus materials by
returning them to the Company.
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18. You hereby expressly waive any lien, encumbrance or right of setoff
whatsoever that you may have with respect to funds deposited with you for the
payment of transfer taxes by reasons of amounts, if any, borrowed by the
Company, or any of its subsidiaries or affiliates, pursuant to any loan or
credit agreement with you or for compensation owed to you hereunder.
19. For services rendered as Exchange Agent hereunder, you shall be
entitled to such compensation as set forth on the fee schedule delivered
pursuant to the initial offering of the Initial Notes.
20. You hereby acknowledge receipt of the Prospectus and the Letter of
Transmittal and further acknowledge that you have examined the Letter of
Transmittal and such portions of the Prospectus as are specifically referred to
herein. Any inconsistency between this Agreement, on the one hand, and the
Prospectus and the Letter of Transmittal (as they may be amended from time to
time) on the other hand, shall be resolved in favor of the latter two documents,
except with respect to the duties, liabilities and indemnification of you as
Exchange Agent, which shall be controlled by this Agreement.
21. The Company covenants and agrees to indemnify and hold you harmless in
your capacity as Exchange Agent hereunder against any loss, liability, cost or
expense, including attorneys' fees and expenses and any tax, assessment or other
governmental charge, arising out of or in connection with the performance of
your duties as Exchange Agent hereunder, including any act, omission, delay or
refusal made by you in reliance upon any signature, endorsement, assignment,
certificate, order, request, notice, instruction (including any oral order,
request, notice or instruction) or other instrument or document reasonably
believed by you to be valid, genuine and sufficient and in accepting any tender
or effecting any transfer of Initial Notes reasonably believed by you in good
faith to be authorized, and in delaying or refusing in good faith to accept any
tenders or effect any transfer of Initial Notes; provided, however, that the
Company shall not be liable for indemnification or otherwise for any loss,
liability, cost or expense to the extent arising out of your gross negligence,
bad faith or willful misconduct. In no case shall the Company be liable under
this indemnity with respect to any claim against you unless the Company shall be
notified by you (such notification, if oral, to be promptly confirmed in
writing), of the assertion of a claim against you or of any action commenced
against you, promptly after you shall have received any such assertion or notice
of commencement of action; provided, however, that your failure to give such
prompt notice (or to promptly confirm in writing any such oral notice) shall not
release, waive or otherwise affect the Company's indemnification obligations
hereunder except to the extent that the Company can demonstrate actual loss or
material prejudice as a result of such failure. The Company shall be entitled to
participate at its own expense in the defense of any such claim or other action,
and, if the Company so elects, the Company shall assume the defense of any suit
brought to enforce any such claim. In the event that the Company shall assume
the defense of any such suit, the Company shall not be liable for the fees and
expenses of any additional counsel thereafter retained by you so long as the
Company shall retain counsel satisfactory to you to defend such suit.
22. You shall arrange to comply with all requirements under the tax laws
of the United States, including those relating to missing Tax Identification
Numbers, and shall file any appropriate reports with the Internal Revenue
Service. The Company understands that you are required to deduct 31% on payments
to holders who have not supplied their correct Taxpayer
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Identification Number or required certification. Such funds will be turned over
to the Internal Revenue Service in accordance with applicable regulations.
23. You shall deliver or cause to be delivered, in a timely manner to each
governmental authority to which any transfer taxes are payable in respect of the
exchange of Initial Notes, your check in the amount of all transfer taxes so
payable, and the Company shall reimburse you for the amount of any and all
transfer taxes payable in respect of the exchange of Initial Notes; provided,
however, that you shall reimburse the Company for amounts refunded to you in
respect of your payment of any such transfer taxes at such time as such refund
is received by you.
24. This Agreement and your appointment as Exchange Agent hereunder shall
be construed and enforced in accordance with the laws of the State of New York
applicable to agreements made and to be performed entirely within such state,
and without regard to conflicts of law principles, and shall inure to the
benefit of, and the obligations created hereby shall be binding upon, the
successors and assigns of each of the parties hereto.
25. This Agreement may be executed in two or more counterparts, each of
which shall be deemed to be an original and all of which taken together shall
constitute one and the same agreement.
26. In case any provision of this Agreement shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.
27. This Agreement shall not be deemed or construed to be modified,
amended, rescinded, canceled or waived, in whole or in part, except by a written
instrument signed by a duly authorized representative of the party to be
charged. This Agreement may not be modified orally.
28. Unless otherwise provided herein, all notices, requests and other
communications to any party hereunder shall be in writing (including facsimile
or similar writing) and shall be given to such party, addressed to it, at its
address or telecopy number set forth below:
If to the Company:
PSINet Inc.
000 Xxxxxxx Xxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx X. Postal
Facsimile: (000) 000-0000
With a copy to:
Nixon, Hargrave, Devans & Xxxxx LLP
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X. Xxxxxx, Xx.
Facsimile: (000) 000-0000
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If to the Exchange Agent:
Wilmington Trust Company
Xxxxxx Square North
0000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000-0000
Attention: Xxxxx Xxxxxx
Facsimile: (000) 000-0000
29. Unless terminated earlier by the parties hereto, this Agreement shall
terminate 90 days following the Expiration Date. Notwithstanding the foregoing,
paragraphs 19, 21, 23 and 24 hereof shall survive the termination of this
Agreement. Upon any termination of this Agreement, you shall promptly deliver to
the Company any certificates for funds or property then held by you as Exchange
Agent under this Agreement.
30. This Agreement shall be binding and effective as of the date hereof.
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Please acknowledge receipt of this Agreement and confirm the arrangements
herein provided by signing and returning the enclosed copy.
PSINET INC.
By: /s/ Xxxxx X. Xxxxxx
______________________________
Name: Xxxxx X. Xxxxxx
____________________________
Title: Senior Vice President and
___________________________
General Counsel
___________________________
Accepted as of the date
first above written:
WILMINGTON TRUST COMPANY,
as Exchange Agent
By: /s/ Xxxxxx X. Xxxx
______________________________
Name: Xxxxxx X. Xxxx
____________________________
Title: Financial Service Officer
___________________________
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