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Exhibit 10.39
PURCHASE AGREEMENT
QWEST CAPITAL FUNDING, INC.
$1,250,000,000 OF 5.875% Notes due August 3, 2004
$2,000,000,000 OF 7% NOTES DUE AUGUST 3, 2009
$500,000,000 OF 7.625% Notes due August 3, 2021
UNCONDITIONALLY GUARANTEED AS TO PAYMENT OF
PRINCIPAL, PREMIUM, IF ANY, AND INTEREST BY
QWEST COMMUNICATIONS INTERNATIONAL INC.
July 25, 2001
Xxxxxx Brothers Inc.
0 Xxxxx Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
XXXXXXX XXXXX & CO., INC.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
0 Xxxxx Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
As Representatives of the several Initial Purchasers
named in Schedule I hereto
Ladies and Gentlemen:
Qwest Capital Funding, Inc. (formerly known as U S WEST Capital
Funding, Inc.), a Colorado corporation (the "COMPANY"), proposes to issue and
sell to the several Initial Purchasers listed in Schedule I hereto (the "INITIAL
PURCHASERS") for whom Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated and
Xxxxxx Brothers Inc. are acting as representatives (the "REPRESENTATIVES"),
$1,250,000,0000 of 5.875% Notes due August 3, 2004 (the "2004 NOTES"),
$2,000,000,0000 of 7% Notes due August 3, 2009 (the "2009 NOTES") and
$500,000,000 of 7.625% Notes due August 3, 2021 (the "2021 NOTES" together
with the 2004 Notes and the 2009 Notes, the "NOTES"). The Notes will be
unconditionally guaranteed as to payment of principal, premium, if any, and
interest (the "GUARANTEES" and together with the Notes, the "SECURITIES") by
Qwest Communications International Inc. (as successor to U S WEST, Inc. ("U S
WEST")), a Delaware corporation (the "GUARANTOR"), and will be issued pursuant
to the provisions of an Indenture, dated as of June 29, 1998, as amended by the
First Supplemental Indenture, dated as of June 30, 2000 (as so amended, the
"INDENTURE"), among the Company, the Guarantor and Bank One Trust Company,
National Association, as trustee (the "TRUSTEE").
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The Securities will have the benefit of a Registration Rights
Agreement, dated as of July 30, 2001 (the "REGISTRATION RIGHTS AGREEMENT"),
among the Company, the Guarantor and the Initial Purchasers, pursuant to which
the Company and the Guarantor have agreed, for the benefit of the Initial
Purchasers and their respective direct and indirect transferees and assigns, to
register the Securities under the Securities Act of 1933, as amended (the
"SECURITIES ACT") subject to the terms and conditions therein specified.
The sale of the Securities to the Initial Purchasers will be made
without registration of the Securities under the Securities Act, in reliance
upon exemptions therefrom.
In connection with the sale of the Securities, the Company and the
Guarantor have prepared an offering memorandum dated July 25, 2001 (the
"OFFERING MEMORANDUM"), for the information of the Initial Purchasers and for
delivery to prospective purchasers of the Securities. The term Offering
Memorandum shall be deemed to mean and include documents incorporated by
reference therein. All references in this Agreement to financial statements and
schedules and other information which is "contained," "included," "stated" or
"given" in the Offering Memorandum (or other references of like import) shall be
deemed to mean and include all such financial statements and schedules and other
information which is incorporated by reference in the Offering Memorandum.
The Company and the Guarantor hereby agree with the Initial Purchasers
as follows:
1. The Company agrees to issue and sell the Securities to the several Initial
Purchasers as hereinafter provided, and each Initial Purchaser, upon the basis
of the representations and warranties herein contained, but subject to the
conditions hereinafter stated, agrees to purchase, severally and not jointly,
from the Company the respective principal amount of 2004 Notes set forth
opposite such Initial Purchaser's name in Schedule I hereto at a price (the
"PURCHASE PRICE") equal to 99.570% of their principal amount, the principal
amount of 2009 Notes set forth opposite such Initial Purchaser's name in
Schedule I hereto at a Purchase Price equal to 98.702% of their principal amount
and the principal amount of 2021 Notes set forth opposite such Initial
Purchaser's name in Schedule I hereto at a Purchase Price equal to 98.083% of
their principal amount, plus in each case accrued interest, if any, from July
30, 2001 to the date of payment and delivery.
2. The Company and the Guarantor understand that the Initial Purchasers intend
(i) to offer privately pursuant to Rule 144A ("Rule 144A") and pursuant to
Regulation S ("Regulation S"), each under the Securities Act their respective
portions of the Securities as soon after this Agreement has become effective as
in the judgment of the Initial Purchasers is advisable and (ii) initially to
offer the Securities upon the terms set forth in the Offering Memorandum.
Each of the Company and the Guarantor confirms that it has authorized
the Initial Purchasers, subject to the restrictions set forth below, to
distribute copies of the Offering Memorandum in connection with the offering of
the Securities. Each Initial Purchaser hereby severally makes to the Company and
the Guarantor the following representations and agreements:
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(i) it is a "qualified institutional buyer" within the meaning
of Rule 144A under the Securities Act; and
(ii) (A) it will not solicit offers for, or offer to sell, the
Securities by any form of general solicitation or general advertising
(as those terms are used in Regulation D under the Securities Act
("REGULATION D")) and (B) it will solicit offers for the Securities
only from, and will offer the Securities only to, persons whom it
reasonably believes to be (x) in the case of offers inside the United
States, "qualified institutional buyers" within the meaning of Rule
144A and (y) in the case of offers outside the United States, to
persons other than U.S. persons, as defined under Regulation S
("FOREIGN PURCHASERS", which term shall include dealers or other
professional fiduciaries in the United States acting on a discretionary
basis for foreign beneficial owners (other than an estate or trust))
that, in each case, in purchasing the Securities are deemed to have
represented and agreed as provided in the Offering Memorandum;
With respect to offers and sales outside the United States, as described in
clause (ii)(B)(y) above, each Initial Purchaser hereby represents and agrees
with the Company and the Guarantor that:
(i) it understands that no action has been or will be taken by
the Company or the Guarantor that would permit a public offering of the
Securities, or possession or distribution of the Offering Memorandum or
any other offering or publicity material relating to the Securities, in
any country or jurisdiction where action for that purpose is required;
(ii) it will comply with all applicable laws and regulations
in each jurisdiction in which it acquires, offers, sells or delivers
Securities or has in its possession or distributes the Offering
Memorandum or any such other material,
(iii) it understands that the Securities have not been and
will not be registered under the Securities 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 or pursuant to
an exemption from, or in a transaction not subject to, the registration
requirements of the Securities Act;
(iv) it has offered the Securities and will offer and sell the
Securities (x) as part of its distribution at any time and (y)
otherwise until 40 days after the later of the commencement of the
offering and the Closing Date (as defined in Section 3 below), only in
accordance with Rule 903 of Regulation S. Accordingly, neither such
Initial Purchaser, nor any of its Affiliates, as defined under
Regulation S-X under the Securities Act, nor any persons acting on its
behalf has engaged or will engage in any directed selling efforts
(within the meaning of Regulation S) with respect to the Securities,
and such Initial Purchaser, its Affiliates and any such persons have
complied and will comply with the offering restrictions requirement of
Regulation S;
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(v) it agrees that (i) it has not offered or sold Securities
and, prior to six months after the issue date of such Securities, will
not offer or sell any such Securities to persons in the United Kingdom
except to persons whose ordinary activities involve them in acquiring,
holding, managing or disposing of investments (as principal or agent)
for the purposes of their businesses or otherwise in circumstances
which have not resulted and will not result in an offer to the public
in the United Kingdom 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 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 an issue of 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
(as amended) or is a person to whom such document may otherwise
lawfully be issued or passed on.
Terms used in this Section 2 and not otherwise defined in this Agreement have
the meanings given to them by Regulation S.
3. Payment for the Securities shall be made by wire transfer in immediately
available funds to the account specified by the Company to the Representatives
at 9:00 A.M., New York City time, on July 30, 2001, or at such other time on the
same or such other date, not later than the third Business Day thereafter, as
the Representatives and the Company may agree upon in writing. The time and date
of such payment are referred to herein as the "CLOSING DATE". As used herein,
the term "BUSINESS DAY" means any day other than a day on which banks are
permitted or required to be closed in New York City.
Payment for the Securities shall be made against delivery with respect
to Securities to be resold to "qualified institutional buyers" by the Initial
Purchasers, to the nominee of The Depository Trust Company for the respective
accounts of the several Initial Purchasers of the Securities of one or more
global notes (collectively, "RESTRICTED GLOBAL NOTES") representing such
Securities and with respect to Securities to be resold to foreign purchasers by
the Initial Purchasers, to the nominee of The Depository Trust Company for the
respective accounts of the several Initial Purchasers of the Securities of one
or more Regulation S global notes (collectively, the "REGULATION S GLOBAL NOTES"
and, together with the Restricted Global Notes, the "GLOBAL NOTES") representing
such Securities, with any transfer taxes payable in connection with the transfer
to the Initial Purchasers of the Securities duly paid by the Company. The Global
Notes will be made available for inspection by the Initial Purchasers at the
office of Sidley Xxxxxx Xxxxx & Xxxx LLP, Xxx Xxxxx Xxxxx Xxxxxx, Xxx Xxxx, Xxx
Xxxx 00000 not later than 1:00 P.M., New York City time, on the Business Day
prior to the Closing Date.
4. The Company and the Guarantor represent and warrant to each Initial Purchaser
that:
(a) the Offering Memorandum will not, in the form used by the
Initial Purchasers to confirm sales of the Securities and as of the
Closing Date, contain any untrue statement of a material fact or omit
to state a material fact necessary in
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order to make the statements therein, in light of the circumstances
existing at such dates, not misleading; provided, however, that this
representation and warranty shall not apply to any statements or
omissions made in reliance upon and in conformity with written
information furnished to the Company or the Guarantor by any Initial
Purchaser, or on behalf of any Initial Purchaser by the
Representatives, specifically for use therein;
(b) the documents incorporated by reference in the Offering
Memorandum (the "INCORPORATED DOCUMENTS"), when they were filed with
the Securities and Exchange Commission (the "COMMISSION"), conformed in
all material respects to the requirements of the Securities Exchange
Act of 1934, as amended (the "EXCHANGE ACT"), and the rules and
regulations of the Commission thereunder, and none of such documents
contained an untrue statement of a material fact or omitted to state a
material fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading; and any
further documents so filed and incorporated by reference in the
Offering Memorandum, when such documents are filed with the Commission,
will conform in all material respects to the requirements of the
Exchange Act, and will not contain an untrue statement of a material
fact or omit to state a material fact necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading;
(c) the financial statements of U S WEST and the Guarantor,
together with the related schedules and notes thereto, included and
incorporated by reference in the Offering Memorandum present fairly the
consolidated financial position of each such entity and its
consolidated subsidiaries as of the dates indicated and the statement
of operations, shareowners' equity and cash flows of each such entity
and its consolidated subsidiaries for the periods specified; and said
financial statements have been prepared in conformity with generally
accepted accounting principles and practices applied on a consistent
basis throughout the periods involved. The pro forma financial
statements of the Guarantor and U S WEST and the related notes thereto
included and incorporated by reference in the Offering Memorandum, to
the best knowledge of the Company and the Guarantor, present fairly the
information shown therein, have been prepared in accordance with the
Commission's rules and guidelines with respect to the pro forma
financial statements and have been properly compiled on the bases
described therein and the assumptions used therein, and the assumptions
used in the preparation thereof are reasonable and the adjustments used
therein are appropriate to give effect to the transactions and
circumstances referred to therein;
(d) since the respective dates as of which information is
given in the Offering Memorandum, except as otherwise stated therein,
(A) there has been no material adverse change in the financial
condition or results of operations of the Company or of the Guarantor
and its subsidiaries, taken as a whole (a "MATERIAL ADVERSE EFFECT"),
(B) there have been no transactions entered into by the Company or by
the Guarantor or any of its subsidiaries, other than those in the
ordinary course of business, which are material with respect to the
Company or the
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Guarantor and its subsidiaries, taken as a whole, and (C) there has
been no dividend or distribution of any kind declared, paid or made by
the Company or the Guarantor on any class of its capital stock, except
for regular quarterly dividends on the Guarantor's common stock in
amounts that are consistent with past practice;
(e) this Agreement has been duly authorized, executed and
delivered by each of the Company and the Guarantor;
(f) the Indenture has been duly authorized, executed and
delivered by each of the Company and the Guarantor and (assuming the
due authorization, execution and delivery by the Trustee) constitutes
the legal, valid and binding agreement of the Company and the Guarantor
enforceable against each of them in accordance with its terms, except
as the enforcement thereof may be limited by bankruptcy, insolvency
(including, without limitation, all laws relating to fraudulent
transfers), reorganization, moratorium or similar laws affecting
enforcement of creditors' rights generally and except as enforcement
thereof is subject to general principles of equity (regardless of
whether enforcement is considered in a proceeding in equity or at law);
(g) the Registration Rights Agreement has been duly authorized
by the Company and the Guarantor and, when executed and delivered by
the Company and the Guarantor, will constitute a valid and binding
agreement of each of the Company and the Guarantor, enforceable against
the Company and the Guarantor in accordance with its terms, except as
the enforcement thereof may be limited by bankruptcy, insolvency
(including, without limitation, all laws relating to fraudulent
transfers), reorganization, moratorium or similar laws affecting
enforcement of creditors' rights generally and except as enforcement
thereof is subject to general principles of equity (regardless of
whether enforcement is considered in a proceeding in equity or at law),
and except that enforcement of rights to indemnification and
contribution contained therein may be limited by applicable Federal or
state laws or the public policy underlying such laws;
(h) the Securities have been duly authorized and, at the
Closing Date, will have been duly executed by the Company and, when
authenticated, issued and delivered in the manner provided for in the
Indenture and delivered against payment of the purchase price therefor
as provided in this Agreement, will constitute legal, valid and binding
obligations of the Company, enforceable against the Company in
accordance with their terms, except as the enforcement thereof may be
limited by bankruptcy, insolvency (including, without limitation, all
laws relating to fraudulent transfers), reorganization, moratorium or
similar laws affecting enforcement of creditors' rights generally and
except as enforcement thereof is subject to general principles of
equity (regardless of whether enforcement is considered in a proceeding
in equity or at law), and will be in the form contemplated by, and
entitled to the benefits of, the Indenture;
(i) the Guarantees have been duly authorized and, at the
Closing Date, will have been duly executed by the Guarantor and, when
issued and delivered in
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the manner provided for in the Indenture, will constitute legal, valid
and binding obligations of the Guarantor, enforceable against the
Guarantor in accordance with their terms, except as the enforcement
thereof may be limited by bankruptcy, insolvency (including, without
limitation, all laws relating to fraudulent transfers), reorganization,
moratorium or similar laws affecting enforcement of creditors' rights
generally and except as enforcement thereof is subject to general
principles of equity (regardless of whether enforcement is considered
in a proceeding in equity or at law), and will be in the form
contemplated by, and entitled to the benefits of, the Indenture;
(j) the Exchange Notes (as defined in the Registration Rights
Agreement) have been duly authorized and, when authenticated, issued
and delivered in the manner provided for in the Indenture and issued
and delivered in exchange for the Notes in the manner contemplated in
the Registration Rights Agreement, will constitute valid and binding
obligations of the Company, enforceable against the Company in
accordance with their terms, except as the enforcement thereof may be
limited by bankruptcy, insolvency (including, without limitation, all
laws relating to fraudulent transfers), reorganization, moratorium or
similar laws affecting enforcement of creditors' rights generally and
except as enforcement thereof is subject to general principles of
equity (regardless of whether enforcement is considered in a proceeding
in equity or at law), and will be in the form contemplated by, and
entitled to the benefits of, the Indenture;
(k) the Exchange Guarantees (as defined in the Registration
Rights Agreement) have been duly authorized and, when authenticated,
issued and delivered in the manner provided for in the Indenture and
issued and delivered in the manner contemplated in the Registration
Rights Agreement, will constitute valid and binding obligations of the
Guarantor, enforceable against the Guarantor in accordance with their
terms, except as the enforcement thereof may be limited by bankruptcy,
insolvency (including, without limitation, all laws relating to
fraudulent transfers), reorganization, moratorium or similar laws
affecting enforcement of creditors' rights generally and except as
enforcement thereof is subject to general principles of equity
(regardless of whether enforcement is considered in a proceeding in
equity or at law, and will be in the form contemplated by, and entitled
to the benefit of the Indenture);
(l) as of the Closing Date, the Securities, the Exchange
Notes, the Exchange Guarantees, the Indenture and the Registration
Rights Agreement will conform in all material respects to the
respective statements relating thereto contained in the Offering
Memorandum;
(m) the execution, delivery and performance of this Agreement
and the Registration Rights Agreement and the consummation of the
transactions contemplated herein and therein (including, without
limitation, the issuance and sale of the Securities) and compliance by
the Company and the Guarantor with their respective obligations
hereunder and thereunder have been duly authorized by all necessary
corporate action and do not and will not, whether with or without the
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giving of notice or passage of time or both, conflict with or
constitute a breach of, or default or Repayment Event (as defined
below) under, or result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the Company, the
Guarantor or any subsidiary of the Guarantor pursuant to, any contract,
indenture, mortgage, deed of trust, loan or credit agreement, note,
lease or other agreement or instrument to which the Company, the
Guarantor or any subsidiary of the Guarantor is a party or by which it
or any of them may be bound, or to which any of the property or assets
of the Company, the Guarantor or any subsidiary of the Guarantor is
subject (collectively, "AGREEMENTS AND INSTRUMENTS") (except for such
conflicts, breaches or defaults or liens, charges or encumbrances that
would not result in a Material Adverse Effect), nor will such action
result in any violation of the provisions of the charter or bylaws of
the Company, the Guarantor or any subsidiary of the Guarantor or, to
the best knowledge of the Company and the Guarantor, any applicable
law, statute, rule, regulation, judgment, order, writ or decree of any
government, government instrumentality or court, domestic or foreign,
having jurisdiction over the Company, the Guarantor or any subsidiary
of the Guarantor or any of their assets, properties or operations. As
used herein, a "REPAYMENT EVENT" means any event or condition which
gives the holder of any note, debenture or other evidence of
indebtedness of the Company, the Guarantor or any subsidiary of the
Guarantor (or any person acting on such holder's behalf) the right to
require the repurchase, redemption or repayment of all or a portion of
such indebtedness by the Company, the Guarantor or any subsidiary of
the Guarantor;
(n) other than as set forth in the Offering Memorandum, there
is not pending or, to the knowledge of the Company or the Guarantor,
threatened, any action, suit, proceeding, inquiry or investigation to
which the Company, the Guarantor or any subsidiary of the Guarantor is
a party or to which the assets, properties or operations of the
Company, the Guarantor or any subsidiary of the Guarantor is subject,
before or by any court or governmental agency or body, domestic or
foreign, which might reasonably be expected to result in a Material
Adverse Effect or which might reasonably be expected to materially and
adversely affect the assets, properties or operations of the Company,
the Guarantor and any subsidiary of the Guarantor, taken as a whole, or
the consummation of the transactions contemplated by this Agreement or
the Indenture or the performance by the Company or the Guarantor of
their respective obligations thereunder;
(o) the Guarantor and its subsidiaries possess such permits,
licenses, approvals, consents and other authorizations (collectively,
"GOVERNMENTAL LICENSES") issued by the appropriate federal, state,
local or foreign regulatory agencies or bodies necessary to conduct the
business now operated by them; the Guarantor and its subsidiaries are
in compliance with the terms and conditions of all such Governmental
Licenses, except where the failure so to comply would not, singly or in
the aggregate, have a Material Adverse Effect; all of the Governmental
Licenses are valid and in full force and effect, except when the
invalidity of such Governmental Licenses or the failure of such
Governmental Licenses to be in full force and effect would not have a
Material Adverse Effect; and neither the
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Guarantor nor any of its subsidiaries has received any notice of
proceedings relating to the revocation or modification of any such
Governmental Licenses which, singly or in the aggregate, if the subject
of an unfavorable decision, ruling or finding, would result in a
Material Adverse Effect;
(p) none of the Company, the Guarantor or any of their
respective affiliates (as defined in Rule 501(b) of Regulation D) has
directly, or through any agent, sold, offered for sale, solicited
offers to buy or otherwise negotiated in respect of, any security (as
defined in the Securities Act) which is or will be integrated with the
sale of the Securities in a manner that would require the registration
under the Securities Act of the offering contemplated by the Offering
Memorandum;
(q) none of the Company, the Guarantor, any affiliate (as
defined in Rule 501(b) of Regulation D) of the Company or the Guarantor
or any person acting on its or their behalf has offered or sold the
Securities by means of any general solicitation or general advertising
within the meaning of Rule 502(c) under the Securities Act, or by means
of any directed selling efforts within the meaning of Rule 902 of
Regulation S, and the Company, the Guarantor, any affiliate of the
Company and the Guarantor and any person acting on its or their behalf
has complied with and will implement the "offering restrictions"
requirements of Regulation S;
(r) the Securities satisfy the requirements set forth in Rule
144A(d)(3) under the Securities Act;
(s) assuming the accuracy of the representations of the
Initial Purchasers contained in Section 2 hereof, it is not necessary
in connection with the offer, sale and delivery of the Securities in
the manner contemplated by this Agreement to register the Securities
under the Securities Act or to qualify the Indenture under the Trust
Indenture Act of 1939, as amended (the "TRUST INDENTURE ACT"); and
(t) 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.
5. The Company and the Guarantor covenant and agree with each of the several
Initial Purchasers as follows:
(a) to deliver to the Initial Purchasers as many copies of the
Offering Memorandum (including all amendments and supplements thereto)
as the Initial Purchasers may reasonably request;
(b) before distributing any amendment or supplement to the
Offering Memorandum, to furnish to the Representatives a copy of the
proposed amendment
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or supplement for review and not to distribute any such proposed
amendment or supplement to which the Representatives reasonably object;
(c) if, at any time prior to the earlier of (i) 9 months from
the date of the Offering Memorandum and (ii) notice by the
Representatives to the Company and the Guarantor of the completion of
the initial placement of the Securities, any event shall occur as a
result of which the Offering Memorandum as then amended or supplemented
would include an 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 is necessary to amend or supplement the Offering Memorandum to
comply with law, forthwith to prepare and furnish, at the expense of
the Company, to the Initial Purchasers and to the dealers (whose names
and addresses the Representatives will furnish to the Company) to which
Securities may have been sold by the Initial Purchasers on behalf of
the Initial Purchasers and to any other dealers upon request, such
amendments or supplements to the Offering Memorandum as may be
necessary to correct such statement or omission or to effect compliance
with law;
(d) to endeavor to qualify the Securities for offer and sale
under the securities or Blue Sky laws of such jurisdictions as the
Representatives shall reasonably request and to continue such
qualification in effect so long as reasonably required for distribution
of the Securities; provided that the Company shall not be required to
file a general consent to service of process in any jurisdiction;
(e) during the period of two years after the date hereof, to
furnish to the Initial Purchasers, as soon as practicable after the end
of each fiscal year, a copy of the Guarantor's annual report to
shareholders, if any, for such year, and to furnish to the Initial
Purchasers and to counsel to the Initial Purchasers, (i) as soon as
available, a copy of each report of the Guarantor filed with the
Commission under the Exchange Act or mailed to stockholders, and (ii)
from time to time, such other information concerning the Guarantor or
the Company as the Initial Purchasers may reasonably request;
(f) during the period beginning on the date hereof and
continuing to and including the Business Day following the Closing
Date, not to, directly or indirectly, sell, offer to sell, grant any
option for the sale of, or otherwise dispose of, any of its senior debt
securities having a maturity of one year or more without the prior
written consent of the Representatives;
(g) to use the net proceeds received by the Company from the
sale of the Securities pursuant to this Agreement in the manner
specified in the Offering Memorandum under the caption "Use of
Proceeds";
(h) to furnish to the holders of the Securities no later than
90 days after the end of each fiscal year an annual report (including a
balance sheet and statements of income, stockholders' equity and cash
flows of the Guarantor and its
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consolidated subsidiaries certified by independent public accountants)
and, as soon as practicable after the end of each of the first three
quarters of each fiscal year (beginning with the fiscal quarter ending
after the date of the Offering Memorandum), consolidated summary
financial information of the Guarantor and its subsidiaries of such
quarter in reasonable detail;
(i) during the period of two years after the Closing Date, the
Company and the Guarantor will not, and will not permit any of their
respective controlled "affiliates" (as defined in Rule 144 under the
Securities Act) to, resell any of the Securities which constitute
"restricted securities" under Rule 144 that have been reacquired by any
of them;
(j) whether or not the transactions contemplated by this
Agreement are consummated or this Agreement is terminated, to pay or
cause to be paid all costs and expenses incident to the performance of
its obligations hereunder and under the Registration Rights Agreement,
including without limiting the generality of the foregoing, all fees,
costs and expenses (i) incident to the preparation, issuance,
execution, authentication and delivery of the Securities, including any
expenses of the Trustee, (ii) incident to the preparation, printing and
distribution of the Offering Memorandum (including all exhibits,
amendments and supplements thereto), (iii) incurred in connection with
the registration or qualification and determination of eligibility for
investment of the Securities under the laws of such jurisdictions as
the Representatives may designate (including reasonable fees of counsel
for the Initial Purchasers and their disbursements) and the printing of
memoranda relating thereto, (iv) in connection with the approval for
trading of the Securities on any securities exchange or inter-dealer
quotation system, if so requested, (v) in connection with the printing
(including word processing and duplication costs) and delivery of this
Agreement, the Indenture, any Preliminary and Supplemental Blue Sky
Memoranda and any Legal Investment Survey and the furnishing to Initial
Purchasers and dealers of copies of the Offering Memorandum, including
mailing and shipping, as herein provided, (vi) payable to rating
agencies in connection with the rating of the Securities, if
applicable, and (vii) any expenses incurred by the Company in
connection with a "road show" presentation to potential investors;
(k) while the Securities remain outstanding and are
"restricted securities" within the meaning of Rule 144(a)(3) and cannot
be sold without restriction under Rule 144(k) under the Securities Act,
the Company and the Guarantor will, during any period in which the
Guarantor is not subject to Section 13 or 15(d) under the Exchange Act
or is not complying with the reporting requirements thereof, make
available to the purchasers and any holder of Securities in connection
with any sale thereof and any prospective purchaser of Securities and
securities analysts, in each case upon request, the information
specified in, and meeting the requirements of, Rule 144A(d)(4) under
the Securities Act (or any successor thereto);
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(l) neither the Company nor the Guarantor will take any action
prohibited by Regulation M under the Exchange Act, in connection with
the distribution of the Securities contemplated hereby;
(m) none of the Company, the Guarantor, any of their
respective affiliates (as defined in Rule 501(b) of Regulation D under
the Securities Act) or any person acting on behalf of the Company, the
Guarantor or such affiliate will solicit any offer to buy or offer or
sell the Securities by means of any form of general solicitation or
general advertising, including: (i) any advertisement, article, notice
or other communication published in any newspaper, magazine or similar
medium or broadcast over television or radio; and (ii) any seminar or
meeting whose attendees have been invited by any general solicitation
or general advertising; and
(n) none of the Company, the Guarantor, any of their
respective affiliates (as defined in Rule 144(a)(1) under the
Securities Act) or any person acting on behalf of any of the foregoing
will engage in any directed selling efforts with respect to the
Securities within the meaning of Regulation S; and
(o) none of the Company, the Guarantor, any of their
respective affiliates (as defined in Regulation 501(b) of Regulation D
under the Securities Act) or any person acting on behalf of the
Company, the Guarantor or such affiliate will sell, offer for sale or
solicit offers to buy or otherwise negotiate in respect of any security
(as defined in the Securities Act) which will be integrated with the
sale of the Securities in a manner which would require the registration
under the Securities Act of the Securities and the Company and the
Guarantor will take all action that is appropriate or necessary to
assure that its offerings of other securities will not be integrated
for purposes of the Securities Act with the offering contemplated
hereby.
6. The several obligations of the Initial Purchasers hereunder to purchase the
Securities on the Closing Date are subject to the performance by the Company and
the Guarantor of their respective obligations hereunder and to the following
additional conditions:
(a) the representations and warranties of the Company and the
Guarantor contained herein are true and correct on and as of the
Closing Date as if made on and as of the Closing Date, the statements
of the officers of the Company and the Guarantor made pursuant to
Section 6(e) hereof are true and correct and the Company and the
Guarantor shall have complied with all agreements and all conditions on
their part to be performed or satisfied hereunder at or prior to the
Closing Date;
(b) except as previously disclosed to the Initial Purchasers
by the Company or the Guarantor in writing prior to the execution of
this Agreement, there shall not have occurred any downgrading, nor
shall any notice have been given of (i) any downgrading, (ii) any
intended or potential downgrading or (iii)
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any review or possible change that does not indicate an improvement, in
the rating accorded any debt securities of or guaranteed by the Company
or the Guarantor by any "nationally recognized statistical rating
organization", as such term is defined for purposes of Rule 436(g)(2)
under the Securities Act;
(c) since the respective dates as of which information is
given in the Offering Memorandum, there shall not have been any change
in the financial condition of the Company or of the Guarantor and its
subsidiaries, taken as a whole, or in the earnings, affairs or business
prospects of the Company or of the Guarantor and its subsidiaries,
taken as a whole, otherwise than as set forth or contemplated in the
Offering Memorandum as of July 25 2001, the effect of which is, in the
judgment of the Representatives, so material and adverse as to make it
impracticable or inadvisable to proceed with the offering or the
delivery of the Securities on the Closing Date on the terms and in the
manner contemplated in the Offering Memorandum;
(d) the Representatives shall have received on and as of the
Closing Date a certificate of the President, any Vice President, the
Treasurer, any Assistant Treasurer or the Associate General Counsel of
the Company in which such officers shall state that, to the best of
their knowledge after reasonable investigation, the representations and
warranties of the Company in this Agreement are true and correct as if
made at and as of the Closing Date, that the Company has complied in
all material respects with all agreements and satisfied all conditions
on its part to be performed or satisfied hereunder at or prior to the
Closing Date and that, since the respective dates as of which
information is given in the Offering Memorandum, there has been no
material adverse change in the financial condition or results of
operations of the Company, or, to the best knowledge of the Company, of
the Guarantor, and its subsidiaries, taken as a whole, except as set
forth in or contemplated by the Offering Memorandum as of July 25,
2001;
(e) the Representatives shall have received on and as of the
Closing Date a certificate of the Chief Executive Officer, the
President, any Vice President, the Treasurer, any Assistant Treasurer,
or the Associate General Counsel of the Guarantor in which such
officers shall state that, to the best of their knowledge after
reasonable investigation, the representations and warranties of the
Guarantor in this Agreement are true and correct as if made at and as
of the Closing Date, that the Guarantor has complied in all material
respects with all agreements and satisfied all conditions on its part
to be performed or satisfied hereunder at or prior to the Closing Date
and that, since the respective dates as of which information is given
in the Offering Memorandum, there has been no material adverse change
in the financial condition or results of operations of the Guarantor
and its subsidiaries, taken as a whole, except as set forth in or
contemplated by the Offering Memorandum;
(f) Holme Xxxxxxx & Xxxx LLP shall have furnished to the
Initial Purchasers their written opinion, dated the Closing Date, in
form and substance satisfactory to the Initial Purchasers, to the
effect that:
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(i) The Company is a corporation duly incorporated,
and is validly existing and in good standing under the laws of
the State of Colorado, with corporate power to own, lease and
operate its properties and to carry on its business as now
being conducted.
(ii) The execution, delivery and performance of this
Agreement have been duly authorized by all necessary corporate
action on the part of the Company, and this Agreement has been
duly executed and delivered by the Company.
(iii) The execution, delivery and performance of the
Indenture has been duly authorized by all necessary corporate
action on the part of the Company, and the Indenture has been
duly executed and delivered by the Company.
(iv) The Registration Rights Agreement has been duly
authorized by all necessary corporate action on the part of
the Company, and the Registration Rights Agreement has been
duly executed and delivered by the Company.
(v) The Notes have been duly authorized by all
necessary corporate action on the part of the Company.
(vi) The Exchange Notes (as defined in the
Registration Rights Agreement) have been duly authorized by
all necessary corporate action on the part of the Company.
In rendering such opinion, such counsel may rely as to matters
of fact, to the extent such counsel deems proper, on certificates of
responsible officers of the Company and of public officials
The opinion of Holme Xxxxxxx & Xxxx LLP described above shall
be rendered to the Initial Purchasers at the request of the Company and
shall so state therein.
(g) O'Melveny & Xxxxx LLP shall have furnished to the Initial
Purchasers their written opinion, dated the Closing Date, in form and
substance satisfactory to the Initial Purchasers, to the effect that:
(i) The Guarantor is a corporation duly incorporated,
and is validly existing in good standing under the laws of the
State of Delaware, with corporate power to own, lease and
operate its properties and to carry on its business as
described in the Offering Memorandum.
(ii) The execution, delivery and performance of the
Indenture have been duly authorized by all necessary corporate
action on the part of the Guarantor, and the Indenture has
been duly executed and delivered by the Guarantor.
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(iii) The execution, delivery and performance of this
Agreement and the Registration Rights Agreement have been duly
authorized by all necessary corporate action on the part of
the Guarantor, and this Agreement and the Registration Rights
Agreement have been duly executed and delivered by the
Guarantor.
(iv) The Indenture constitutes the legally valid and
binding obligation of each of the Company and the Guarantor,
enforceable against each of the Company and the Guarantor in
accordance with its terms, except as may be limited by
bankruptcy, insolvency, reorganization, moratorium or similar
laws relating to or affecting creditor's rights generally
(including, without limitation, fraudulent conveyance laws)
and by general principles of equity, including, without
limitation, concepts of materiality, reasonableness, good
faith and fair dealing and the possible unavailability of
specific performance or injunctive relief, regardless of
whether considered in a proceeding in equity or at law.
(v) The Notes, when duly executed and authenticated
in the manner contemplated by the Indenture and issued and
delivered to the Initial Purchasers against payment therefor
in accordance with the provisions hereof, will be legally
valid and binding obligations of the Company entitled to the
benefits of the Indenture, enforceable against the Company in
accordance with their terms, except as may be limited by
bankruptcy, insolvency, reorganization, moratorium or similar
laws relating to or affecting creditor's rights generally
(including, without limitation, fraudulent conveyance laws),
and by general principles of equity including, without
limitation, concepts of materiality, reasonableness, good
faith and fair dealing and the possible unavailability of
specific performance or injunctive relief, regardless of
whether considered in a proceeding in equity or at law.
(vi) The Guarantees have been duly authorized by all
necessary corporate action on the part of the Guarantor and
when duly executed in the manner contemplated by the Indenture
and issued and delivered to the Initial Purchasers in
accordance with the provisions hereof, will be legally valid
and binding obligations of the Guarantor, enforceable against
the Guarantor in accordance with their terms, except as may be
limited by bankruptcy, insolvency, reorganization, moratorium
or similar laws relating to or affecting creditor's rights
generally (including, without limitation, fraudulent
conveyance laws), and by general principles of equity
including, without limitation, concepts of materiality,
reasonableness, good faith and fair dealing and the possible
unavailability of specific performance or injunctive relief,
regardless of whether considered in a proceeding in equity or
at law.
(vii) The Exchange Notes, when duly executed in the
manner contemplated in the Indenture and issued and delivered
in exchange for the
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Notes in the manner contemplated in the Registration Rights
Agreement, will be legally valid and binding obligations of
the Company, enforceable against the Company in accordance
with their terms, except as may be limited by bankruptcy,
insolvency, reorganization, moratorium or similar laws
relating to affecting creditors rights generally (including,
without limitation, fraudulent conveyance laws), and by
general principles of equity including, without limitation,
concepts of materiality, reasonableness, good faith and fair
dealing and the possible unavailability of specific
performance or injunctive relief, regardless of whether
considered in a proceeding in equity or at law.
(viii) The Exchange Guarantees (as defined in the
Registration Rights Agreement) have been duly authorized by
all necessary corporate action on the part of the Guarantor
and when duly executed in the manner contemplated in the
Indenture and issued and delivered in the manner contemplated
in the Registration Rights Agreement, will be legally valid
and binding obligations of the Guarantor, enforceable against
the Guarantor in accordance with their terms, except as may be
limited by bankruptcy, insolvency, reorganization, moratorium
or similar laws relating to or effecting creditors rights
generally (including, without limitation, fraudulent
conveyance laws), and by general principles of equity
including, without limitation, concepts of materiality,
reasonableness, good faith and fair dealing and the possible
unavailability of specific performance or injunctive relief,
regardless of whether considered in a proceeding in equity or
at law.
(ix) The Registration Rights Agreement constitutes
the legally valid and binding obligation of the Company and
the Guarantor, enforceable against the Company and the
Guarantor in accordance with its terms, except as may be
limited by bankruptcy, insolvency, reorganization, moratorium
or similar laws relating to or affecting creditor's rights
generally (including, without limitation, fraudulent
conveyance laws) and by general principles of equity,
including, without limitation, concepts of materiality,
reasonableness, good faith and fair dealing and the possible
unavailability of specific performance or injunctive relief,
regardless of whether considered in a proceeding in equity or
at law, and except that no opinion is expressed with respect
to the provisions contained in Section 4 of the Registration
Rights Agreement.
(x) No order, consent, permit or approval of or
filing with any federal governmental authority is required on
the part of the Company or the Guarantor for the execution and
delivery of this Agreement, the Indenture or the issuance and
sale of the Securities to the Initial Purchasers pursuant to
the terms of this Agreement, except such as may be required
under applicable blue sky or state securities laws.
(xi) The statements in the Offering Memorandum under
the headings "Description of Notes", "Exchange Offer;
Registration Rights" and "Notice
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to Investors", insofar as they summarize provisions of the
Indenture or the Securities or constitute a summary of certain
provisions of the documents referred to therein, fairly
summarize the matters referred to therein.
(xii) The Notes satisfy the requirement set forth in
Rule 144A(d)(3) under the Securities Act.
(xiii) Based upon the representations, warranties and
agreements of the Company and the Guarantor in Sections 4(p),
4(q), 4(r), 5(m), 5(n), 5(o) and 6(a) of this Agreement and of
the Initial Purchasers in Section 2 of this Agreement and on
the truth and accuracy of the representations and agreements
deemed to be made by the purchasers of the Securities
contained in the Offering Memorandum, it is not necessary in
connection with the offer, sale and delivery of the Securities
to the Initial Purchasers under this Agreement or in
connection with the initial resale of such Securities by the
Initial Purchasers in accordance with Section 2 of this
Agreement to register the Securities under the Securities Act
or to qualify the Indenture under the Trust Indenture Act;
provided, however, that such counsel need not express any
opinion with respect to the conditions under which the
Securities may be further resold.
(xiv) The documents incorporated by reference in the
Offering Memorandum, on the respective dates they were filed,
appeared on their face to comply in all material respects with
the requirements as to form for reports on Form 10-K, Form
10-Q and Form 8-K, as the case may be, under the Exchange Act,
as amended, and Form S-4 under the Securities Act, and the
related rules and regulations in effect at the respective
dates of their filings, except that such counsel need express
no opinion concerning the financial statements and other
financial information contained or incorporated by reference
therein.
In rendering such opinion, such counsel may rely as to matters
of fact, to the extent such counsel deems proper, on certificates of
responsible officers of the Company and the Guarantor and of public
officials. Such counsel may also rely as to matters of Colorado law
upon the opinion of Holme Xxxxxxx & Xxxx LLP without independent
verification. Such counsel need express no opinion as to matters
relating to the Federal Communications Commission or any state public
utilities commission or similar authority for the Company or the
Guarantor, as applicable.
In addition, such counsel may state that in connection with
such counsel's participation in conferences in connection with the
preparation of the Offering Memorandum, such counsel has not
independently verified the accuracy, completeness or fairness of the
statements contained or incorporated therein, and the limitations
inherent in the examination made by such counsel and the knowledge
available to such counsel are such that such counsel is unable to
assume, and does not assume, any responsibility for such accuracy,
completeness
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or fairness (except as otherwise specifically stated in paragraph (xii)
above). However, such counsel shall state that on the basis of such
counsel's review of the Offering Memorandum and the documents
incorporated by reference therein and their participation in
conferences in connection with the preparation of the Offering
Memorandum, such counsel does not believe that the Offering Memorandum
and the documents incorporated therein, considered as a whole, as of
its issue date or on the date of the opinion, contained any untrue
statement of a material fact or omitted to state a material fact
necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading. However, such
counsel need express no opinion or belief as to the financial
statements and other financial information contained or incorporated by
reference in the Offering Memorandum or in the documents incorporated
therein by reference.
Such opinion may state that it does not address the impact on
the opinions contained therein of any litigation or ruling relating to
the divestiture by American Telephone and Telegraph Company of
ownership of its operating telephone companies (the "DIVESTITURE").
The opinion of O'Melveny & Xxxxx LLP described above shall be
rendered to the Initial Purchasers at the request of the Company and
shall so state therein.
(h) Xxxx X. Xxxx, Esq., Associate General Counsel for the
Company and the Guarantor shall have furnished to the Initial
Purchasers his written opinion, dated the Closing Date, in form and
substance satisfactory to the Initial Purchasers, to the effect that:
(i) The execution, delivery and performance of this
Agreement and the Registration Rights Agreement have been duly
authorized by all necessary corporate action on the part of
the Guarantor, and this Agreement has been duly executed and
delivered by the Guarantor.
(ii) All state regulatory consents, approvals,
authorizations or other orders (except as to the state
securities or blue sky laws, as to which such counsel need
express no opinion) legally required for the execution of the
Indenture and the issuance and sale of the Securities to the
Initial Purchasers pursuant to the terms of this Agreement
have been obtained; provided that such counsel may rely on
opinions of local counsel satisfactory to such counsel.
(iii) To such counsel's knowledge, there is not
pending or threatened any action, suit, proceeding, inquiry or
investigation to which the Company, the Guarantor or any
subsidiary of the Guarantor is a party or to which the assets,
properties or operations of the Company, the Guarantor or any
subsidiary of the Guarantor is subject, before or by any court
or governmental agency or body, domestic or foreign, which (a)
might reasonably be expected to result in a Material Adverse
Effect, or (b) might reasonably be expected to materially and
adversely affect the consummation
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by the Company or the Guarantor of the transactions
contemplated by this Agreement, the Registration Rights
Agreement or the Securities or the Indenture or the
performance by the Company or the Guarantor of their
respective obligations hereunder or thereunder.
(iv) The execution, delivery and performance of this
Agreement and the Registration Rights Agreement by the Company
and the Guarantor will not (A) violate the charter or bylaws
of the Company or the Guarantor, or (B) violate, breach or
result in a default under any material contract, indenture,
mortgage, loan agreement, note, lease or other material
agreement known to such counsel to which the Company or
Guarantor is a party or to which any of their respective
properties or assets are subject; provided that such counsel
need express no opinion as to the effect of the Company's or
Guarantor's performance of its obligations under this
Agreement or the Registration Rights Agreement on the
compliance by the Company or the Guarantor with financial
covenants in any such contract, indenture, mortgage, loan
agreement, note, lease or other agreement.
(v) To such counsel's knowledge, neither the Company,
the Guarantor nor any of its subsidiaries is in violation of
its charter or bylaws.
Such counsel may state that is does not address the impact of
the opinions contained therein on any litigation or ruling relating to
the Divestiture. Such counsel need express no opinion with respect to
matters relating to the Federal Communications Commission or state
public utilities commissions for the Company or the Guarantor, as
applicable.
(i) Xxxxx & Xxxxxxx L.L.P. shall have furnished to the Initial
Purchasers their written opinion, dated the Closing Date, in form and
substance satisfactory to the Initial Purchasers, to the effect that no
consent, approval, authorization or other action by, or filing or
registration with, any federal or state government authority is
required in connection with the execution and delivery by the Company
or the Guarantor of this Agreement or the issuance and sale of the
Securities to the Initial Purchasers pursuant to the terms of this
Agreement.
(j) on the date of the issuance of the Offering Memorandum and
also on the Closing Date, Xxxxxx Xxxxxxxx LLP shall have furnished to
the Initial Purchasers letters, dated the respective dates of delivery
thereof, in form and substance satisfactory to the Representatives,
containing statements and information of the type customarily included
in accountants "comfort letters" to underwriters with respect to the
financial statements and certain financial information contained in the
Offering Memorandum;
(k) the Initial Purchasers shall have received on and as of
the Closing Date an opinion of Sidley Xxxxxx Xxxxx & Xxxx LLP, counsel
to the Initial Purchasers, with respect to the validity of the
Indenture and the Securities, and such other related matters as the
Initial Purchasers may reasonably request, and such
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counsel shall have received such papers and information as they may
reasonably request to enable them to pass upon such matters;
(l) the Initial Purchasers shall have received prior to the
Closing Date a copy of the Registration Rights Agreement, in the form
and substance satisfactory to the Initial Purchasers, duly executed by
the Company and the Guarantor, and the Registration Rights Agreement
shall be in full force and effect at the Closing Date; and
(m) on or prior to the Closing Date the Company shall have
furnished to the Initial Purchasers such further certificates and
documents as the Initial Purchasers shall reasonably request.
7. (a) The Company and the Guarantor jointly and severally agree to indemnify
and hold harmless each Initial Purchaser against any losses, claims, damages or
liabilities, joint or several, to which such Initial Purchaser may become
subject, as incurred, under the Securities Act, the Exchange Act 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 any material fact contained in the Offering Memorandum or any
amendment 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 will reimburse
each Initial Purchaser, as incurred, for any legal or other expenses reasonably
incurred by such Initial Purchaser in connection with investigating or defending
any such loss, claim, damage, liability or action or amounts paid in settlement
of any litigation or investigation or proceeding related thereto if such
settlement is effected with the written consent of the Company and the
Guarantor; provided, however, that the Company and the Guarantor 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 untrue statement or alleged untrue
statement or omission or alleged omission made in any of such documents in
reliance upon and in conformity with written information furnished to the
Company or the Guarantor by any Initial Purchaser, or on behalf of any Initial
Purchaser by the Representatives, specifically for use therein.
(b) Each Initial Purchaser will indemnify and hold harmless the Company and
the Guarantor against any losses, claims, damages or liabilities to which the
Company or the Guarantor may become subject, as incurred, under the Securities
Act 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 any material fact contained in the Offering
Memorandum or any amendment or supplement thereto, or arise out of or are based
upon the omission or the 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, in
each case to the extent, but only to the extent, that such untrue statement or
alleged untrue statement or omission or alleged omission was made in reliance
upon and in conformity with written information furnished to the Company or the
Guarantor by such Initial Purchaser, or on behalf of such Initial Purchaser by
the Representatives, specifically for use therein, and will reimburse the
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Company and the Guarantor, as incurred, for any legal or other expenses
reasonably incurred by the Company and the Guarantor in connection with
investigating or defending any such loss, claim, damage, liability or action.
(c) Promptly after receipt by an indemnified party under this Section 7
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 7, notify the indemnifying party of the commencement thereof; but the
omission so to notify the indemnifying party will not relieve it from any
liability which it may have to any indemnified party otherwise than under this
Section 7. In case any such action is brought against any indemnified party, and
it notifies the indemnifying party of the commencement thereof, the indemnifying
party will be entitled to participate therein and, to the extent that it may
wish, jointly with any other indemnifying party similarly notified, to assume
the defense thereof, with counsel satisfactory to such indemnified party (who
shall not, except with the consent of the indemnified party, be counsel to the
indemnifying party), and after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof, the
indemnifying party will not be liable to such indemnified party under this
Section 7 for any legal or other expenses subsequently incurred by such
indemnified party in connection with the defense thereof other than reasonable
costs of investigation. The indemnifying party or parties shall not be liable
under this Agreement with respect to any settlement made by any indemnified
party or parties without prior written consent by the indemnifying party or
parties to such settlement.
(d) If the indemnification provided for in this Section 7 is
unavailable or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above, then each indemnifying party shall contribute to
the amount paid or payable by such indemnified party as a result of the losses,
claims, damages or liabilities referred to in subsection (a) or (b) above, (i)
in such proportion as is appropriate to reflect the relative benefits received
by the Company and the Guarantor on the one hand and the Initial Purchasers on
the other from the offering of the Securities or (ii) if the allocation provided
by clause (i) above is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause (i)
above but also the relative fault of the Company and the Guarantor on the one
hand and the Initial Purchasers on the other in connection with the statements
or omissions which resulted in such losses, claims, damages or liabilities as
well as any other relevant equitable considerations. The relative benefits
received by the Company and the Guarantor on the one hand and the Initial
Purchasers on the other shall be deemed to be in the same proportion as the
total net proceeds from the offering (before deducting expenses) received by the
Company bear to the total discounts and commissions received by the Initial
Purchasers. The relative fault shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Company and the Guarantor or the Initial Purchasers and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such untrue statement or omission. The amount paid by an
indemnified party as a result of the losses, claims, damages or liabilities
referred to in the first sentence of this subsection (d) shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified
party in connection with investigating
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or defending any action or claim which is the subject of this subsection (d).
Notwithstanding the provisions of this subsection (d), no Initial Purchaser
shall be required to contribute any amount in excess of the amount by which the
total price at which the Securities purchased by it were offered exceeds the
amount of any damages which such Initial Purchaser has otherwise been required
to pay by reason of such untrue or alleged untrue statement or omission or
alleged omission. No person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The Initial Purchasers' obligations in this subsection (d) to
contribute are several in proportion to the respective principal amount of the
Securities set forth opposite their names in Schedule I hereto, and not joint.
(e) The obligations of the Company and the Guarantor under this Section
7 shall be in addition to any liability which the Company or the Guarantor may
otherwise have and shall extend, upon the same terms and conditions, to each
person, if any, who controls any Initial Purchaser within the meaning of the
Securities Act or the Exchange Act; and the obligations of the Initial
Purchasers under this Section 7 shall be in addition to any liability which the
respective Initial Purchasers may otherwise have and shall extend, upon the same
terms and conditions, to each person, if any, who controls the Company or the
Guarantor within the meaning of the Securities Act or the Exchange Act.
The indemnity and contribution agreements contained in this Section 7
and the representations and warranties of the Company set forth in this
Agreement shall remain operative and in full force and effect regardless of (i)
any termination of this Agreement, (ii) any investigation made by or on behalf
of any Initial Purchaser or any person controlling any Initial Purchaser or by
or on behalf of the Company or the Guarantor or any person controlling the
Company or the Guarantor and (iii) acceptance of and payment for any of the
Securities.
8. Notwithstanding anything herein contained, this Agreement may be terminated
in the absolute discretion of the Initial Purchasers, by notice given to the
Company and the Guarantor, if after the execution and delivery of this Agreement
and prior to the Closing Date (i) trading generally shall have been suspended or
materially limited on or by, as the case may be, any of the New York Stock
Exchange, the American Stock Exchange, the Nasdaq National Market, the Chicago
Board Options Exchange, the Chicago Mercantile Exchange or the Chicago Board of
Trade, (ii) trading of any securities of or guaranteed by the Company or the
Guarantor shall have been suspended on any exchange or in any over-the-counter
market, (iii) a general moratorium on commercial banking activities in New York
shall have been declared by either Federal or New York State authorities, or
(iv) there shall have occurred any outbreak or escalation of hostilities or any
change in financial markets or any calamity or crisis that, in the judgment of
the Initial Purchasers, is material and adverse and which, in the judgment of
the Initial Purchasers, makes it impracticable to market the Securities on the
terms and in the manner contemplated in the Offering Memorandum.
9. This Agreement shall become effective upon the execution and delivery hereof
by the parties hereto.
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10. If, on the Closing Date any one or more of the Initial Purchasers shall fail
or refuse to purchase Securities which it or they have agreed to purchase
hereunder on such date, and the aggregate principal amount of Securities which
such defaulting Initial Purchaser or Initial Purchasers agreed but failed or
refused to purchase is not more than one-tenth of the aggregate principal amount
of the Securities to be purchased on such date, the other Initial Purchasers
shall be obligated severally in the proportions that the principal amount of
Securities set forth opposite their respective names in Schedule I bears to the
aggregate principal amount of Securities set forth opposite the names of all
such non-defaulting Initial Purchasers, or in such other proportions as the
Initial Purchasers may specify, to purchase the Securities which such defaulting
Initial Purchaser or Initial Purchasers agreed but failed or refused to purchase
on such date; provided that in no event shall the principal amount of Securities
that any Initial Purchaser has agreed to purchase pursuant to Section 1 be
increased pursuant to this Section 10 by an amount in excess of one-tenth of
such principal amount of Securities without the written consent of such Initial
Purchaser. If, on the Closing Date any Initial Purchaser or Initial Purchasers
shall fail or refuse to purchase Securities which it or they have agreed to
purchase hereunder on such date, and the aggregate principal amount of
Securities with respect to which such default occurs is more than one-tenth of
the aggregate principal amount of Securities to be purchased on such date, and
arrangements satisfactory to the Initial Purchasers, the Company and the
Guarantor for the purchase of such Securities are not made within 36 hours after
such default, this Agreement shall terminate without liability on the part of
any non-defaulting Initial Purchaser, the Company or the Guarantor. In any such
case either the Initial Purchasers, the Company or the Guarantor shall have the
right to postpone the Closing Date, but in no event for longer than seven days,
in order that the required changes, if any, in the Offering Memorandum or in any
other documents or arrangements may be effected. Any action taken under this
paragraph shall not relieve any defaulting Initial Purchaser from liability in
respect of any default of such Initial Purchaser under this Agreement.
11. If this Agreement shall be terminated by the Initial Purchasers, or any of
them, because of any failure or refusal on the part of the Company or the
Guarantor to comply with the terms or to fulfill any of the conditions of this
Agreement, or if for any reason the Company or the Guarantor shall be unable to
perform its obligations under this Agreement or any condition of the Initial
Purchasers' obligations cannot be fulfilled, (i) the Company and the Guarantor
shall remain responsible for the expenses to be paid or reimbursed by them
pursuant to Section 5(j) and (ii) except in the event this Agreement is
terminated pursuant to clauses (i), (iii) or (iv) of Section 8, the Company and
the Guarantor agree to reimburse the Initial Purchasers or such Initial
Purchasers as have so terminated this Agreement with respect to themselves,
severally, for the out-of-pocket expenses reasonably incurred by such Initial
Purchasers in connection with this Agreement or the offering contemplated
hereunder, not exceeding $75,000, and for the fees and disbursements of their
counsel.
12. This Agreement shall inure to the benefit of and be binding upon the
Company, the Guarantor, the Initial Purchasers, any controlling persons referred
to herein and their respective successors and assigns. Nothing expressed or
mentioned in this Agreement is intended or shall be construed to give any other
person, firm or corporation any legal or equitable right, remedy or claim under
or in respect of this Agreement or any provision
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herein contained. No purchaser of Securities from any Initial Purchaser shall be
deemed to be a successor by reason merely of such purchase.
13. All notices and other communications hereunder shall be in writing and shall
be deemed to have been duly given if mailed or transmitted by any standard form
of telecommunication. Notices to the Initial Purchasers shall be given to the
Initial Purchasers c/o Merrill Lynch, Pierce, Xxxxxx & Xxxxx Incorporated, 0
Xxxxx Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000; Attention: Syndicate Desk and
Xxxxxx Brothers Inc., 0 Xxxxx Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000
(telefax: (000) 000-0000); Attention: Debt Capital Markets. Notices to the
Company and the Guarantor shall be given to each of them at 0000 Xxxxxxxxxx
Xxxxxx, Xxxxxx, Xxxxxxxx 00000 (telefax: (000) 000-0000); Attention: Xxxxx
Xxxxxx, with a copy to General Counsel (telefax: (000) 000-0000).
14. This Agreement may be signed in counterparts, each of which shall be an
original and all of which together shall constitute one and the same instrument.
15. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO THE CONFLICTS OF LAWS
PROVISIONS THEREOF.
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If the foregoing is in accordance with your understanding, please sign
and return counterparts hereof.
Very truly yours,
QWEST CAPITAL FUNDING, INC.
By:____________________________________
Name:
Title:
QWEST COMMUNICATIONS INTERNATIONAL INC.
By:____________________________________
Name:
Title:
Accepted: July 25, 2001
XXXXXX BROTHERS INC.
XXXXXXX XXXXX & CO., INC.
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX
INCORPORATED
By: XXXXXX BROTHERS INC.
By:_______________________________
Name:
Title:
By: XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX
INCORPORATED
By:_______________________________
Name:
Title:
For themselves and as Representatives of the
other Initial Purchasers named in Schedule I
hereto.
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