EXHIBIT 10.2
THIRD AMENDED AND RESTATED
NOVEMBER 1998 STOCKHOLDERS' AGREEMENT
This Third Amended and Restated November 1998
Stockholders' Agreement (this "Agreement") is entered into as of
March 10, 2000, by and among McLeodUSA Incorporated, a Delaware
corporation (the "Company"); Alliant Energy Corporation, a
Wisconsin corporation ("AEC"); Alliant Energy Investments, Inc.,
an Iowa corporation and indirect wholly owned subsidiary of AEC
("AEI"); Heartland Properties, Inc., a Wisconsin corporation and
indirect wholly owned subsidiary of AEC ("Heartland"); LNT
Communications LLC, an Iowa limited liability company and
indirect wholly owned subsidiary of AEC ("LNT"); Alliant Energy
Foundation, Inc., a Wisconsin corporation (non-profit) ("AEF" and
together with AEC, AEI, Heartland and LNT, the "AEC Entities");
Clark E. McLeod ("McLeod"); Mary E. McLeod (together with McLeod,
the "McLeods"); Richard A. Lumpkin ("Lumpkin") and certain of the
former shareholders of Consolidated Communications Inc. ("CCI")
and certain permitted transferees of certain of the former CCI
shareholders in each case who are listed in Schedule I hereto
(the "Principal CCI Shareholders"); and for purposes of Sections
4, 5.6, 5.8(b), 5.11 and the first and second sentences of
Section 5.3 only, certain of the other former CCI shareholders
and certain permitted transferees of certain of the other former
CCI shareholders in each case who are listed in Schedule II
hereto (the "Other CCI Shareholders"). The AEC Entities, the
McLeods, and Lumpkin and the Principal CCI Shareholders are
referred to herein collectively as the "Principal Stockholders"
and individually as a "Principal Stockholder."
WHEREAS, the Company, AEC, AEI, Heartland, AEF, the
McLeods, Lumpkin, the Principal CCI Shareholders and the Other
CCI Shareholders are parties to a Second Amended and Restated
November 1998 Stockholders' Agreement, entered into as of
December 17, 1999 (the "Second Amended and Restated November 1998
Stockholders' Agreement");
WHEREAS, the Company, AEC, AEI, Heartland, AEF, the
McLeods, Lumpkin and the Principal CCI Shareholders desire to add
LNT as a party to this Agreement as a result of the transfer of
certain shares of the Company's Class A common stock, par value
$.01 per share (the "Class A Common Stock"), by an Affiliate (as
defined in Section 1.2) of AEC to LNT;
WHEREAS, the Other CCI Shareholders no longer desire to
be parties to this Agreement and the Company and the Principal
Stockholders desire to terminate the Other CCI Shareholders as
parties to this Agreement;
WHEREAS, the Company and the Principal Stockholders
deem it to be in the best interests of the Company and its
stockholders to provide for the continuity and stability of the
business and policies of the Company on the terms and conditions
hereinafter set forth;
WHEREAS, concurrently with the execution and delivery
of this Agreement, the Company, the Principal Stockholders, the
Other CCI Shareholders and certain other stockholders of the
Company are entering into an amendment and restatement of the
Second Amended and Restated January 1999 Stockholders' Agreement,
entered into as of December 17, 1999; and
WHEREAS, the Company and the Principal Stockholders
desire to amend and restate the Second Amended and Restated
November 1998 Stockholders' Agreement in its entirety with the
terms and conditions hereinafter set forth;
NOW, THEREFORE, for and in consideration of the
foregoing and of the mutual covenants and agreements contained
herein, the parties hereto agree as follows:
1. VOTING AGREEMENT
1.1 Board of Directors
For the period commencing on the Effective Date (as
defined in Section 1.2) and ending on the Expiration Date (as
defined in Section 1.2), each Principal Stockholder, for so long
as each such Principal Stockholder beneficially and continuously
owns at least two million five hundred thousand (2,500,000)
shares of Class A Common Stock, subject to adjustment pursuant to
Section 5.1, shall take or cause to be taken all such action
within their respective power and authority as may be required:
(a) to establish and maintain the authorized size of the Board of
Directors of the Company (the "Board of Directors" or the "Board") at
up to thirteen (13) directors;
(b) to cause to be elected to the Board one (1) director designated by the
AEC Entities, for so long as the AEC Entities collectively
beneficially and continuously own at least two million five hundred
thousand (2,500,000) shares of Class A Common Stock (subject to
adjustment pursuant to Section 5.1);
(c) to cause Lumpkin to be elected to the Board, for so long as Lumpkin
and the Principal CCI Shareholders collectively beneficially and
continuously own at least two million five hundred thousand
(2,500,000) shares of Class A Common Stock (subject to adjustment
pursuant to Section 5.1);
(d) to cause to be elected to the Board three (3) directors who are
executive officers of the Company designated by McLeod, for so long as
the McLeods collectively beneficially and continuously own at least
two million five hundred thousand (2,500,000) shares of Class A Common
Stock (subject to adjustment pursuant to Section 5.1);
(e) to cause to be elected to the Board a director or directors nominated
by the Board to replace a director or directors designated pursuant to
paragraphs (b) through (d) above upon the earlier to occur of such
designated director's or directors' resignation (and the acceptance of
such resignation by the Board) and the expiration of such director's
or directors' term as a result of any party or parties identified in
paragraphs (b) through (d) above no longer collectively beneficially
and continuously owning at least two million five hundred thousand
(2,500,000) shares of Class A Common Stock (subject to adjustment
pursuant to Section 5.1) at any time during the period commencing on
the Effective Date and ending on the Expiration Date; it being
understood that within three (3) business days following such time
that the party or parties identified in paragraphs (b) through (d)
above no longer collectively beneficially and continuously own at
least two million five hundred thousand (2,500,000) shares of Class A
Common Stock (subject to adjustment pursuant to Section 5.1) during
such period, such party or parties shall use its or their respective
best efforts to cause the director or directors designated by such
party or parties to tender their immediate resignation to the Board
which the Board may accept or reject; and
(f) to cause to be elected to the Board, if and as nominated by the Board,
up to eight (8) non-employee directors.
For purposes of Section 1.1, (i) the McLeods shall be
deemed to be a single Principal Stockholder, (ii) Lumpkin and all
of the Principal CCI Shareholders shall be deemed to be a single
Principal Stockholder, and the Principal CCI Shareholders shall
be deemed to own shares "continuously" as long as the shares of
the Principal CCI Shareholders are owned by the Principal CCI
Shareholders or a CCI Permitted Transferee (as defined in Section
3.1), and (iii) the AEC Entities shall be deemed to be a single
Principal Stockholder, and the AEC Entities shall be deemed to
own shares "continuously" as long as the shares of the AEC
Entities are owned by the AEC Entities or an AEC Permitted
Transferee (as defined in Section 3.1).
1.2 Definitions
For purposes of this Agreement, the following terms
have the meanings indicated:
(a) "Affiliate" and "Associate" shall have the
respective meanings ascribed to such terms in Rule
12b-2 under the Securities Exchange Act of 1934,
as amended (the "Exchange Act").
(b) A person shall be deemed the "beneficial
owner" of and shall be deemed to "beneficially
own" any securities:
(i) which such person or any of such person's
Affiliates or Associates, directly or
indirectly, has the right to acquire
(whether such right is exercisable
immediately or only after the passage of
time) pursuant to any agreement,
arrangement or understanding (whether or
not in writing), or upon the exercise of
conversion rights, exchange rights, other
rights, warrants or options, or otherwise;
(ii)which such person or any of such person's
Affiliates or Associates, directly or
indirectly, has the right to vote or
dispose of or has "beneficial ownership"
of (as determined pursuant to Rule 13d-3
under the Exchange Act), including
pursuant to any agreement, arrangement or
understanding, whether or not in writing;
or
(iii) which are beneficially owned, directly
or indirectly, by any other person (or any
Affiliate or Associate thereof) with which
such person or any of such person's
Affiliates or Associates has any
agreement, arrangement or understanding
(whether or not in writing), for the
purpose of acquiring, holding, voting or
disposing of any voting securities of the
Company.
For purposes of the definition of "beneficial
owner" and "beneficially own," the terms
"agreement," "arrangement" and "understanding"
shall not include this Agreement or the Third
Amended and Restated January 1999 Stockholders'
Agreement (as defined in Section 1.2).
(c) "Effective Date" shall mean March 10, 2000.
(d) "Expiration Date" shall mean December 31,
2001.
(e) "Original Stockholders' Agreement" shall mean
the Stockholders' Agreement, entered into as of
June 14, 1997, as amended on September 19, 1997,
by and among the Company, AEI, the McLeods,
Lumpkin and certain other stockholders.
(f) "Stock Split" shall mean that certain
two-for-one stock split in the form of a stock
dividend paid on July 26, 1999 to stockholders of
record on July 12, 1999 effected by the Company
with respect to its Class A Common Stock.
(g) "Subsidiary" or "Subsidiaries" shall mean a
corporation, partnership, joint venture or other
entity of which AEC owns, directly or indirectly,
one hundred percent (100%) of the outstanding
securities or other interests the holders of which
are generally entitled to vote for the election of
the board of directors or other governing body.
(h) "Third Amended and Restated January 1999
Stockholders' Agreement" shall mean the Third
Amended and Restated January 1999 Stockholders'
Agreement, entered into as of March 10, 2000, by
and among the Company, the Principal Stockholders,
the Other CCI Shareholders, M/C Investors L.L.C.
and Media/Communications Partners III Limited
Partnership.
2. STANDSTILL
AEC hereby agrees that, prior to the Expiration Date,
neither AEC nor any Affiliate of AEC will (and AEC will not
assist or encourage others to), directly or indirectly, acquire
or agree, offer, seek or propose to acquire, or cause to be
acquired, ownership (including, but not limited to, beneficial
ownership) of any securities issued by the Company or any of its
subsidiaries, or any rights or options to acquire such ownership
(including from a third party), except (a) to the extent
expressly set forth in this Agreement, (b) as consented prior
thereto in writing by the Board of Directors, (c) upon conversion
of any Class B common stock, $.01 par value per share, of the
Company into Class A Common Stock pursuant to the terms thereof,
(d) with respect to transfers of equity securities between or
among AEC and AEC's Subsidiaries consistent with the terms and
conditions of this Agreement, or (e) with respect to the grant,
vesting or exercise of stock options.
3. TRANSFERS OF SECURITIES
3.1 Restrictions on Transfers
(a) Except as otherwise provided in this Section 3.1
or Section 3.2, each Principal Stockholder hereby severally
agrees that until the Expiration Date, such Principal Stockholder
will not offer, sell, contract to sell, grant any option to
purchase, or otherwise dispose of, directly or indirectly,
("Transfer"), any equity securities of the Company or any other
securities convertible into or exercisable for such equity
securities ("Securities") beneficially owned by such Principal
Stockholder (including distributions of Securities with respect
to such Securities and Securities acquired as a result of a stock
split with respect to such Securities) without submitting a
written request to, and receiving the prior written consent of,
the Board of Directors, provided, however, that (i) the AEC
Entities may transfer Securities to or among any Subsidiary or
Subsidiaries of AEC, and (ii) any Principal CCI Shareholder may
transfer Securities to any other Principal CCI Shareholder, the
spouse of a Principal CCI Shareholder, or a lineal descendant of
a Principal CCI Shareholder (or a trust for the primary benefit
of any one or more of a Principal CCI Shareholder, the spouse of
a Principal CCI Shareholder, or a lineal descendant of a
Principal CCI Shareholder or a partnership or limited liability
company owned and managed solely by one or more Principal CCI
Shareholders, spouses of Principal CCI Shareholders and lineal
descendants of Principal CCI Shareholders), or, in the case of a
Principal CCI Shareholder that is a trust, to any beneficiary of
such trust (or a trust for the primary benefit of such
beneficiary or a partnership or limited liability company owned
and managed solely by one or more Principal CCI Shareholders,
spouses of Principal CCI Shareholders and lineal descendants of
Principal CCI Shareholders), in each case with respect to clause
(i) and clause (ii), provided that (x) such transfer is done in
accordance with the transfer restrictions applicable to such
Securities under federal and state securities laws and (y) the
transferee agrees to be bound by the terms hereof (as this
Agreement may be amended or amended and restated from time to
time) as a Principal Stockholder with respect to the shares being
transferred pursuant to this Section (any such AEC Entity
transferee pursuant to the foregoing proviso, an "AEC Permitted
Transferee" and any such Principal CCI Shareholder transferee
pursuant to the foregoing proviso, a "CCI Permitted Transferee"),
and any such transfer shall not constitute a "Transfer" for
purposes of this Agreement. Notwithstanding the foregoing, no
party hereto shall avoid the provisions of this Agreement by
making one or more transfers to one or more AEC Permitted
Transferees or CCI Permitted Transferees, as the case may be, and
then at any time directly or indirectly disposing of all or any
portion of such party's interest in any such AEC Permitted
Transferee or CCI Permitted Transferee, as the case may be. In
the event that the Board of Directors consents to any Transfer of
Securities by a Principal Stockholder pursuant to this
Section 3.1(a) upon the written request of such Principal
Stockholder (the "Transferring Stockholder") and except as
otherwise provided in Section 3.1(b) and Section 3.2, each other
Principal Stockholder shall, notwithstanding the provisions of
this Section 3.1(a), have the right to Transfer a percentage of
the total number of Securities beneficially owned by such
Principal Stockholder equal to the percentage of the total number
of Securities beneficially owned by the Transferring Stockholder
that the Board of Directors has consented may be Transferred by
such Transferring Stockholder. The parties acknowledge that any
Transfer pursuant to this Section 3.1(a) to which the Board of
Directors has consented may be in connection with, or as part of,
a private placement by the Company of, or other transaction
involving, its Securities.
(b) In addition to the provisions of Section 3.1(a),
for the period commencing for the quarter ending March 31, 2000
and ending on the Expiration Date, the Board shall determine
prior to the public release of the Company's consolidated
financial results with respect to each such financial reporting
quarter during such period, the aggregate number, if any, of
shares of Class A Common Stock (not to exceed in the aggregate
three hundred thousand (300,000) shares of Class A Common Stock
per quarter, subject to adjustment pursuant to Section 5.1) that
may be Transferred by the Principal Stockholders (the "Transfer
Amount") during the period commencing on the third (3rd) business
day and ending on the twenty-third (23rd) business day following
such public release of the Company's quarterly or annual
financial results or such other trading period designated or
permitted by the Board with respect to the purchase and sale of
its Securities (each such period, a "Transfer Period").
Notwithstanding the provisions of Section 3.1(a), each Principal
Stockholder shall be entitled to Transfer during each Transfer
Period, provided such Transfer is effected in accordance with all
applicable federal and state securities laws, a number of shares
of Class A Common Stock equal to thirty-three and one-third
percent (33 1/3%) of the Transfer Amount, if any, for such
Transfer Period (rounding down in the case of any fractional
amount). Any portion of any Principal Stockholder's share of the
Transfer Amount that such Principal Stockholder elects not to
transfer during a Transfer Period shall be reallocated equally
among the remaining Principal Stockholders who intend to Transfer
shares of Class A Common Stock during such Transfer Period, and
such remaining Principal Stockholders shall be entitled to
Transfer such additional shares of Class A Common Stock during
the Transfer Period, provided such Transfer is effected in
accordance with all applicable federal and state securities
laws. In no event shall any portion of a Transfer Amount that is
not utilized by a Principal Stockholder during a Transfer Period
be reallocated or otherwise credited to any subsequent Transfer
Periods.
(c) For the period commencing for the quarter ending
March 31, 2000 and ending on the Expiration Date, the Company
shall give each Principal Stockholder prompt written notice (in
any event no later than fifty (50) days prior to the beginning of
the applicable Transfer Period) of its determination of any
Transfer Amount. Within seven (7) days of receipt of such
notice, any Principal Stockholder that desires to Transfer shares
of Class A Common Stock during such Transfer Period pursuant to
Section 3.1(b) shall provide written notice to the Company of the
number of shares of Class A Common Stock that such Principal
Stockholder desires to Transfer pursuant to Section 3.1(b). Not
later than seven (7) days after receipt of such responses, the
Company shall notify all remaining Principal Stockholders of any
Principal Stockholder's election not to Transfer the total number
of shares of Class A Common Stock that such Principal Stockholder
is entitled to Transfer during such Transfer Period. Any
Principal Stockholder that desires to Transfer additional shares
of Class A Common Stock equal to all or part of the remaining
Transfer Amount shall notify the Company within seven (7) days of
receipt of the Company's second notice. The Company shall
allocate the remaining Transfer Amount in accordance with the
provisions of Section 3.1(b) and shall notify the appropriate
Principal Stockholders of such allocation no later than ten (10)
days prior to the beginning of the Transfer Period.
(d) For purposes of this Section 3.1, the McLeods shall
be deemed to be a single Principal Stockholder, Lumpkin and all
of the Principal CCI Shareholders shall be deemed to be a single
Principal Stockholder and the AEC Entities shall be deemed to be
a single Principal Stockholder.
3.2 Registration Rights
(a) In the event that the Board of Directors consents
pursuant to Section 3.1(a) to a Principal Stockholder's request
for a Transfer and in connection therewith, the Company agrees to
register Securities with respect to such Transfer under the
Securities Act of 1933, as amended (the "Securities Act"), the
Company shall grant each other Principal Stockholder the
opportunity (subject to reduction in the event the registered
Transfer is underwritten) to register for Transfer under the
Securities Act a percentage of the total number of Securities
beneficially owned by such Principal Stockholder equal to the
percentage of the total number of Securities beneficially owned
by the Transferring Stockholder that such Transferring
Stockholder is registering for Transfer under the Securities Act,
on the same terms and conditions as the Transferring Stockholder
(each Principal Stockholder registering, or indicating a desire
to register, any Securities for Transfer under the Securities Act
pursuant to this Section 3.2 being a "Registering Transferor").
(b) To the extent that the Company grants pursuant to
Section 3.1(b) a Principal Stockholder the opportunity to
register shares of Class A Common Stock for Transfer under the
Securities Act, the Company shall grant each other Principal
Stockholder the opportunity (subject to reduction in the event
the registered Transfer is underwritten) to register an equal
number of shares of Class A Common Stock for Transfer under the
Securities Act on the same terms and conditions.
(c) In the event the Company proposes to register any
shares of Class A Common Stock under the Securities Act pursuant
to an underwritten primary offering (other than pursuant to a
registration statement on Form S-4 or Form S-8 or any successor
forms thereto or other form which would not permit the inclusion
of the shares of Class A Common Stock of the Principal
Stockholders), the Company, as determined by the Board of
Directors, shall give written notice to all Principal
Stockholders of its intention to effect such a registration.
Following any such notice, the Board of Directors shall undertake
to determine the aggregate number, if any, of shares of Class A
Common Stock held by the Principal Stockholders (not to exceed in
the aggregate on a per year basis a number of shares of Class A
Common Stock equal to fifteen percent (15%) of the total number
of shares of Class A Common Stock beneficially owned by the
Principal Stockholders as of December 31, 1998 (and which, in the
aggregate for Lumpkin and all of the Principal CCI Shareholders
(based on the termination of the Other CCI Shareholders as
parties to this Agreement) on a pre-Stock Split basis, is fifteen
percent (15%) of 2,755,651 shares of Class A Common Stock),
subject to appropriate and proportionate adjustment as a result
of the Stock Split and subject to adjustment pursuant to Section
5.1) to be registered by the Company under the Securities Act
(the "Registrable Amount") for Transfer by the Principal
Stockholders in connection with such offering. If the Board
determines to register shares of Class A Common Stock held by the
Principal Stockholders pursuant to this Section 3.2(c), the
Company will promptly give written notice of such determination
to all Principal Stockholders, and thereupon the Company will use
commercially reasonable efforts to effect the registration of
that portion of the Registrable Amount that the Registering
Transferors indicate a desire to register. In the event the
Registering Transferors indicate a desire to register a number of
shares of Class A Common Stock that, in the aggregate, exceeds
the Registrable Amount, the number of shares of Class A Common
Stock that each Registering Transferor shall be entitled to
register shall be reduced to the extent such number exceeds such
Registering Transferor's pro rata share of the Registrable Amount
based upon the ratio of the total number of Securities
beneficially owned by such Registering Transferor to the total
number of Securities beneficially owned by all Principal
Shareholders. To the extent any portion of the Registrable
Amount remains unallocated after such reductions, each
Registering Transferor who has indicated a desire to register
additional shares of Class A Common Stock shall be entitled to
register an additional amount of Class A Common Stock equal to
such Registering Transferor's pro rata portion of the remaining
Registrable Amount based upon the ratio of the total number of
Securities beneficially owned by such Registering Transferor to
the total number of Securities beneficially owned by all
Registering Transferors who have indicated a desire to register
additional shares of Class A Common Stock. The reallocation
procedure described in the preceding sentence shall be repeated
until the entire Registrable Amount is allocated. All terms,
conditions and rights with respect to such registration
(including but not limited to any determination to reduce the
Registrable Amount) shall be determined by the Board, provided
that (i) the representations and warranties of a Principal
Stockholder shall be customary taking into account, among other
things, the nature of the offering and such Principal
Stockholder's relationship with the Company, and (ii) the Company
shall be responsible for all expenses with respect to such
registration other than underwriting discounts and commissions
allocable to the Class A Common Stock of the Registering
Transferors, which underwriting discounts and commissions shall
be the responsibility of the Registering Transferors.
(d) In addition to the registration rights granted
pursuant to Sections 3.2(a), (b) and (c), no more frequently than
once during each of the calendar years ending December 31, 2000
and 2001 (each such year, an "Annual Period"), and upon either
(i) the receipt of a written request of one or more Principal
Stockholders or (ii) a determination by the Board of Directors,
the Board shall undertake to determine the Registrable Amount, if
any, for Transfer by the Principal Stockholders. If the Board
determines to register shares of Class A Common Stock held by the
Principal Stockholders pursuant to this Section 3.2(d), the
Company will promptly give written notice of such determination
to all Principal Stockholders, and thereupon the Company will use
commercially reasonable efforts to effect the registration of
that portion of the Registrable Amount that the Registering
Transferors indicate a desire to register. In the event the
Registering Transferors indicate a desire to register a number of
shares of Class A Common Stock that, in the aggregate, exceeds
the Registrable Amount, the number of shares of Class A Common
Stock that each Registering Transferor shall be entitled to
register shall be reduced to the extent such number exceeds such
Registering Transferor's pro rata share of the Registrable Amount
based upon the ratio of the total number of Securities
beneficially owned by such Registering Transferor to the total
number of Securities beneficially owned by all Principal
Stockholders. To the extent any portion of the Registrable
Amount remains unallocated after such reductions, each
Registering Transferor who has indicated a desire to register
additional shares of Class A Common Stock shall be entitled to
register an additional amount of Class A Common Stock equal to
such Registering Transferor's pro rata portion of the remaining
Registrable Amount based upon the ratio of the total number of
Securities beneficially owned by such Registering Transferor to
the total number of Securities beneficially owned by all
Registering Transferors who have indicated a desire to register
additional shares of Class A Common Stock. The reallocation
procedure described in the preceding sentence shall be repeated
until the entire Registrable Amount is allocated. All terms,
conditions and rights with respect to such registration
(including but not limited to any determination to reduce the
Registrable Amount) shall be determined by the Board, provided
that (i) the representations and warranties of a Principal
Stockholder shall be customary taking into account, among other
things, the nature of the offering and such Principal
Stockholder's relationship with the Company, and (ii) the Company
shall be responsible for all expenses with respect to such
registration other than underwriting discounts and commissions,
which underwriting discounts and commissions shall be the
responsibility of the Registering Transferors.
(e) If the Board establishes a committee (a "Pricing
Committee") to authorize and approve the price and any other
terms of any Transfer of Securities registered under the
Securities Act pursuant to this Section 3.2 in which Lumpkin or
any Principal CCI Shareholder is participating as a Registering
Transferor, the Company will use its best efforts to cause
Lumpkin to be nominated to such Pricing Committee.
Notwithstanding any other provision of this Agreement, to the
extent the Company has undertaken to register Securities of the
Principal Stockholders pursuant to this Section 3.2, the Company
may subsequently determine not to register such Securities and
may either not file a registration statement or otherwise
withdraw or abandon a registration statement previously filed
with respect to the registration of such Securities.
(f) For purposes of this Section 3.2, the McLeods
shall be deemed to be a single Principal Stockholder, Lumpkin and
all of the Principal CCI Shareholders shall be deemed to be a
single Principal Stockholder and the AEC Entities shall be deemed
to be a single Principal Stockholder.
4. REPRESENTATIONS AND WARRANTIES
4.1 Representations and Warranties of Non-individual
Stockholders
Each non-individual party to this Agreement hereby
represents and warrants, as of the date of this Agreement, to the
Company and to each other party as follows:
4.1.1Authorization
Such party has taken all action necessary for it to
enter into this Agreement and to consummate the transactions
contemplated hereby.
4.1.2Binding Obligation
This Agreement constitutes a valid and binding
obligation of such party, enforceable in accordance with its
terms, except to the extent that such enforceability may be
limited by bankruptcy, insolvency, and similar laws affecting the
rights and remedies of creditors generally, and by general
principles of equity and public policy; and each document and
instrument to be executed by such party pursuant hereto, when
executed and delivered in accordance with the provisions hereof,
shall be a valid and binding obligation of such party,
enforceable in accordance with its terms (with the aforesaid
exceptions).
4.2 Representations and Warranties of Individual
Stockholders
Each party to this Agreement who is an individual
hereby represents and warrants, as of the date of this Agreement,
to the Company and to each other party as follows:
4.2.1Power and Authority
Such party has the legal capacity and all other power
and authority necessary to enter into this Agreement and to
consummate the transactions contemplated hereby.
4.2.2Binding Obligation
This Agreement constitutes a valid and binding
obligation of such party, enforceable in accordance with its
terms, except to the extent that such enforceability may be
limited by bankruptcy, insolvency, and similar laws affecting the
rights and remedies of creditors generally, and by general
principles of equity and public policy; and each document and
instrument to be executed by such party pursuant hereto, when
executed and delivered in accordance with the provisions hereof,
shall be a valid and binding obligation of such party,
enforceable in accordance with its terms (with the aforesaid
exceptions).
4.3 Representations and Warranties of the Company
The Company hereby represents and warrants, as of the
date of this Agreement, to each party as follows:
4.3.1Authorization
The Company has taken all corporate action necessary
for it to enter into this Agreement and to consummate the
transactions contemplated hereby.
4.3.2Binding Obligation
This Agreement constitutes a valid and binding
obligation of the Company, enforceable in accordance with its
terms, except to the extent that such enforceability may be
limited by bankruptcy, insolvency, and similar laws affecting the
rights and remedies of creditors generally, and by general
principles of equity and public policy; and each document and
instrument to be executed by the Company pursuant hereto, when
executed and delivered in accordance with the provisions hereof,
shall be a valid and binding obligation of the Company,
enforceable in accordance with its terms (with the aforesaid
exceptions).
5. MISCELLANEOUS
5.1 Effect of Changes in Capitalization
All share amounts of the Company's capital stock
referred to in this Agreement shall be appropriately and
proportionally adjusted for any recapitalization,
reclassification, stock split-up, combination of shares, exchange
of shares, stock dividend or other distribution payable in
capital stock, or other increase or decrease in such shares
effected without receipt of consideration by the Company,
occurring after the date of this Agreement.
5.2 Additional Actions and Documents
Each of the parties hereto hereby agrees to take or
cause to be taken such further actions, to execute, deliver and
file or cause to be executed, delivered and filed such further
documents and instruments, and to obtain such consents, as may be
necessary or as may be reasonably requested in order to fully
effectuate the purposes, terms and conditions of this Agreement,
whether before, at or after the Effective Date.
5.3 Entire Agreement; Termination of Original
Stockholders' Agreement; Amendment
Other than the Third Amended and Restated January 1999
Stockholders' Agreement with respect to the parties thereto and
as set forth therein, this Agreement constitutes the entire
agreement among the parties hereto as of the date hereof with
respect to the specific matters contemplated herein, and it
supersedes all prior oral or written agreements, commitments or
understandings with respect to the matters provided for herein.
The parties hereto further agree, confirm and acknowledge that
the Original Stockholders' Agreement is terminated and of no
force or effect. No amendment, modification or discharge of this
Agreement shall be valid or binding unless set forth in writing
and duly executed by the Company and by the party against whom
enforcement of the amendment, modification, or discharge is
sought.
5.4 Limitation on Benefit
It is the explicit intention of the parties hereto that
no person or entity other than the parties hereto is or shall be
entitled to bring any action to enforce any provision of this
Agreement against any of the parties hereto, and the covenants,
undertakings and agreements set forth in this Agreement shall be
solely for the benefit of, and shall be enforceable only by, the
parties hereto or their respective successors, heirs, executors,
administrators, legal representatives and permitted assigns.
5.5 Binding Effect; Specific Performance
This Agreement shall be binding upon and shall inure to
the benefit of the parties hereto and their respective
successors, heirs, executors, administrators, legal
representatives and permitted assigns. No party shall assign
this Agreement without the written consent of the other parties
hereto; and such consent shall not be unreasonably withheld. The
parties hereto agree that irreparable damage would occur in the
event any provision of this Agreement was not performed in
accordance with the terms hereof and that the parties shall be
entitled to specific performance of the terms hereof, in addition
to any other remedy at law or in equity.
5.6 Governing Law
This Agreement, the rights and obligations of the
parties hereto, and any claims or disputes relating thereto,
shall be governed by and construed in accordance with the laws of
Delaware (excluding the choice of law rules thereof).
5.7 Notices
All notices, demands, requests, or other communications
which may be or are required to be given, served, or sent by any
party to any other party pursuant to this Agreement shall be in
writing and shall be hand-delivered or mailed by first-class,
registered or certified mail, return receipt requested, postage
prepaid, or transmitted by telegram, telecopy, facsimile
transmission or telex, addressed as follows:
(i) If to the Company or to the McLeods:
McLeodUSA Incorporated
McLeodUSA Technology Park
6400 C Street, SW, P.O. Box 3177
Cedar Rapids, IA 52406-3177
Attention: Randall Rings
Facsimile: (319) 790-7901
(ii) If to the AEC Entities:
Alliant Energy Investments, Inc.
200 1st Street SE
Cedar Rapids, IA 52401
Attention: James E. Hoffman
Facsimile: (319) 398-4204
(iii)If to Lumpkin or any Principal CCI Shareholder:
P.O. Box 1234
Mattoon, IL 61938
Attention: Richard A. Lumpkin
Facsimile: (217) 234-9934
with a copy to :
Schiff Hardin & Waite
6600 Sears Tower
Chicago, Illinois 60606
Attention: David R. Hodgman, Esq.
Facsimile: (312) 258-5600
Each party may designate by notice in writing a new
address to which any notice, demand, request or communication may
thereafter be so given, served or sent. Each notice, demand,
request, or communication which shall be hand-delivered, mailed,
transmitted, telecopied or telexed in the manner described above,
or which shall be delivered to a telegraph company, shall be
deemed sufficiently given, served, sent, received or delivered
for all purposes at such time as it is delivered to the addressee
(with the return receipt, the delivery receipt, or the answerback
being deemed conclusive, but not exclusive, evidence of such
delivery) or at such time as delivery is refused by the addressee
upon presentation.
5.8 Termination
(a) Notwithstanding any other provision of this
Agreement, if during any Annual Period the Board of Directors has
not provided a Principal Stockholder a reasonable opportunity to
Transfer Securities pursuant to Section 3.2 or consented to the
written request of such Principal Stockholder or otherwise
provided such Principal Stockholder a reasonable opportunity to
Transfer (other than a transfer by a Principal CCI Shareholder to
a CCI Permitted Transferee and other than a transfer by the AEC
Entities to an AEC Permitted Transferee) pursuant to Section
3.1(a) an aggregate number of shares of Class A Common Stock
equal to not less than fifteen percent (15%) of the total number
of shares of Class A Common Stock beneficially owned by such
Principal Stockholder as of December 31, 1998 (and which, in the
aggregate for Lumpkin and all of the Principal CCI Shareholders
(based on the termination of the Other CCI Shareholders as
parties to this Agreement) on a pre-Stock Split basis, is fifteen
percent (15%) of 2,755,651 shares of Class A Common Stock),
subject to appropriate and proportionate adjustment as a result
of the Stock Split and subject to adjustment pursuant to Section
5.1, then such Principal Stockholder may terminate this Agreement
as it applies to such terminating party by providing written
notice of termination to the Company and the other Principal
Stockholders no later than ten (10) business days following the
end of such Annual Period, such that all rights and obligations
hereunder shall cease, and this Agreement shall be of no further
force or effect, with respect to the terminating party. Unless
otherwise previously terminated by the Principal Stockholders
pursuant to this Section 5.8(a), this Agreement shall terminate
on the Expiration Date. For purposes of this Section 5.8(a), the
McLeods shall be deemed to be a single Principal Stockholder,
Lumpkin and all of the Principal CCI Shareholders shall be deemed
to be a single Principal Stockholder and the AEC Entities shall
be deemed to be a single Principal Stockholder.
(b) This Agreement is hereby terminated with respect
to each of the Other CCI Shareholders, such that all rights and
obligations hereunder shall cease, and this Agreement shall be of
no further force or effect, with respect to each of the Other CCI
Shareholders.
5.9 Publicity
Each of the Principal Stockholders will use its
reasonable best efforts to consult with the Company prior to
issuing any press release, making any filing with any
governmental entity or national securities exchange or making any
other public dissemination of information by such Principal
Stockholder within which this Agreement or the contents hereof
are referenced or described.
5.10 Appointment of Representative
Each of the Principal CCI Shareholders hereby appoints
Lumpkin, with power of substitution, as its exclusive agent to
act on its behalf with respect to any and all actions to be taken
under or amendments or modifications to be made to this Agreement
(the "Representative"). The Representative shall take, and the
Principal CCI Shareholders agree that the Representative shall
take, any and all actions which the Representative believes are
necessary or advisable under this Agreement for and on behalf of
each of the Principal CCI Shareholders, as fully as if each of
the Principal CCI Shareholders were acting on its own behalf,
including, without limitation, dealing with the Company and the
other parties hereto with respect to all matters arising under
this Agreement, entering into any amendment or modification to
this Agreement deemed advisable by the Representative and taking
any and all other actions specified in or contemplated by this
Agreement. The Company and the other parties hereto shall have
the right to rely upon all actions taken or not taken by the
Representative pursuant to this Agreement, all of which actions
or omissions shall be legally binding upon each of the Principal
CCI Shareholders.
5.11 Execution in Counterparts
To facilitate execution, this Agreement may be executed
in as many counterparts as may be required; and it shall not be
necessary that the signatures of, or on behalf of, each party, or
that the signatures of all persons required to bind any party,
appear on each counterpart; but it shall be sufficient that the
signature of, or on behalf of, each party, or that the signatures
of the persons required to bind any party, appear on one or more
of the counterparts. All counterparts shall collectively
constitute a single agreement. It shall not be necessary in
making proof of this Agreement to produce or account for more
than a number of counterparts containing the respective
signatures of, or on behalf of, all of the parties hereto.
[Remainder of Page Intentionally Left Blank]
IN WITNESS WHEREOF, the undersigned have duly executed
and delivered this Third Amended and Restated November 1998
Stockholders' Agreement, or have caused this Third Amended and
Restated November 1998 Stockholders' Agreement to be duly
executed and delivered on their behalf, as of the day and year
first hereinabove set forth.
McLEODUSA INCORPORATED
By: /s/ J. Lyle Patrick
--------------------------------
Name: J. Lyle Patrick
Title: Group Vice President/CFO
/s/ Clark E. McLeod /s/ Mary E. McLeod
- ------------------- -------------------
Clark E. McLeod Mary E. McLeod
ALLIANT ENERGY CORPORATION
By: /s/ James E. Hoffman
-------------------------------
Name: James E. Hoffman
Title: Executive Vice President
Business Development
ALLIANT ENERGY FOUNDATION, INC.
By: /s/ Edward M. Gleason
----------------------------
Name: Edward M. Gleason
Title: Treasurer
ALLIANT ENERGY INVESTMENTS, INC.
By: /s/ James E. Hoffman
-------------------------
Name: James E. Hoffman
Title: President, Alliant Energy Resources
HEARTLAND PROPERTIES, INC.
By: /s/ Henry Wertheimer
--------------------------------
Name: Henry Wertheimer
Title: Vice President/Treasurer
LNT COMMUNICATIONS LLC
By: Alliant Energy Resources, Inc., its sole member
By: /s/ James E. Hoffman
---------------------------------
Name: James E. Hoffman
Title: President
/s/ Richard A. Lumpkin /s/ Gail G. Lumpkin
- ---------------------- --------------------
Richard A. Lumpkin Gail G. Lumpkin
The two trusts created under the Mary Green Lumpkin Gallo Trust
Agreement dated December 29, 1989, one for the benefit of each
of:
Benjamin Iverson Lumpkin
Elizabeth Arabella Lumpkin
United States Trust Company
of New York, Trustee
By: /s/ Loraine B. Tsavaris
---------------------------------
Name: Loraine B. Tsavaris
Title: Managing Director
The trust established by Richard Adamson Lumpkin under the Trust
Agreement dated February 6, 1970, for the benefit of Richard
Anthony Lumpkin
United States Trust Company
of New York, Trustee
By: /s/ Loraine B. Tsavaris
-------------------------------
Name: Loraine B. Tsavaris
Title: Managing Director
The two trusts created under the Richard Adamson Lumpkin
Grandchildren's Trust dated September 5, 1980, one for the
benefit of each of:
Benjamin Iverson Lumpkin
Elizabeth Arabella Lumpkin
United States Trust Company
of New York, Trustee
By: /s/ Loraine B. Tsavaris
---------------------------------
Name: Loraine B. Tsavaris
Title: Managing Director
The two 1990 Personal Income Trusts established by Richard A.
Lumpkin, dated April 20, 1990, one for the benefit of each of:
Benjamin Iverson Lumpkin
Elizabeth Arabella Lumpkin
/s/ David R. Hodgman
- -------------------------
David R. Hodgman, Trustee
/s/ Steven L. Grissom
- --------------------------
Steven L. Grissom, Trustee
FOR PURPOSES OF SECTIONS 4, 5.6, 5.8(b), 5.11 AND THE FIRST AND
SECOND SENTENCES OF SECTION 5.3 ONLY:
Margaret Lumpkin Keon Trust Mary Lee Sparks Trust
dated May 13, 1978 dated May 13, 1978
/s/ Margaret Lumpkin Keon /s/ Mary Lee Sparks
- ------------------------- ------------------------------
Margaret Lumpkin Keon, as Trustee Mary Lee Sparks, as Trustee
/s/ Steven L. Grissom
---------------------
Steven L. Grissom, as Trustee
/s/ Mary Lee Sparks
- -------------------
Mary Lee Sparks
The ten trusts created under the Mary Green Lumpkin Gallo Trust
Agreement dated December 29, 1989, one for the benefit of each
of:
Joseph John Keon III,
Katherine Stoddert Keon,
Lisa Anne Keon,
Margaret Lynley Keon,
Pamela Keon Vitale,
Susan Tamara Keon DeWyngaert,
Anne Romayne Sparks,
Barbara Lee Sparks,
Christina Louise Sparks, and
John Woodruff Sparks
United States Trust Company
of New York, Trustee
By: /s/ Loraine B. Tsavaris
---------------------------------
Name: Loraine B. Tsavaris
Title: Managing Director
The ten trusts created under the Richard Adamson Lumpkin
Grandchildren's Trust dated September 5, 1980, one for the
benefit of each of:
Joseph John Keon III,
Katherine Stoddert Keon,
Lisa Anne Keon,
Margaret Lynley Keon,
Pamela Keon Vitale,
Susan Tamara Keon DeWyngaert,
Anne Romayne Sparks,
Barbara Lee Sparks,
Christina Louise Sparks, and
John Woodruff Sparks
United States Trust Company
of New York, Trustee
By: /s/ Loraine B. Tsavaris
----------------------------
Name: Loraine B. Tsavaris
Title: Managing Director
The two trusts established by Richard Adamson Lumpkin under the
Trust Agreement dated February 6, 1970, one for the benefit of
each of:
Margaret Anne Keon, and
Mary Lee Sparks
United States Trust Company
of New York, Trustee
By: /s/ Loraine B. Tsavaris
----------------------------
Name: Loraine B. Tsavaris
Title: Managing Director
The ten 1990 Personal Income Trusts established by Margaret L.
Keon and Mary Lee Sparks, each dated April 20, 1990, one for the
benefit of each of:
Joseph John Keon III,
Katherine Stoddert Keon,
Lisa Anne Keon,
Margaret Lynley Keon,
Pamela Keon Vitale,
Susan Tamara Keon DeWyngaert,
Anne Romayne Sparks,
Barbara Lee Sparks,
Christina Louise Sparks, and
John Woodruff Sparks
/s/ David R. Hodgman
- --------------------
David R. Hodgman, Trustee
/s/ Steven L. Grissom
- ---------------------
Steven L. Grissom, Trustee
SCHEDULE I
Richard A. Lumpkin
Gail G. Lumpkin
United States Trust Company of New York, as Trustee of two trusts
created under the Mary Green Lumpkin Gallo Trust Agreement dated
December 29, 1989, one for the benefit of each of Benjamin
Iverson Lumpkin and Elizabeth Arabella Lumpkin.
United States Trust Company of New York, as Trustee of two trusts
created under the Richard Adamson Lumpkin Grandchildren's Trust
dated September 5, 1980, one for the benefit of each of Benjamin
Iverson Lumpkin and Elizabeth Arabella Lumpkin.
United States Trust Company of New York, as Trustee of the trust
established by Richard Adamson Lumpkin under the Trust Agreement
dated February 6, 1970, for the benefit of Richard Anthony
Lumpkin.
David R. Hodgman and Steven L. Grissom, as Trustees of two 1990
Personal Income Trusts established by Richard A. Lumpkin, each
dated April 20, 1990, one for the benefit of each of Benjamin
Iverson Lumpkin and Elizabeth Arabella Lumpkin.
SCHEDULE II
Margaret Lumpkin Keon, as Trustee under the Margaret Lumpkin Keon
Trust dated May 13, 1978.
Mary Lee Sparks and Steven L. Grissom, as Trustees of the Mary
Lee Sparks Trust dated May 13, 1978.
Mary Lee Sparks
United States Trust Company of New York, as Trustee of ten trusts
created under the Mary Green Lumpkin Gallo Trust Agreement dated
December 29, 1989, one for the benefit of each of Joseph John
Keon III, Katherine Stoddert Keon, Lisa Anne Keon, Margaret
Lynley Keon, Pamela Keon Vitale, Susan Tamara Keon DeWyngaert,
Anne Romayne Sparks, Barbara Lee Sparks, Christina Louise Sparks,
and John Woodruff Sparks.
United States Trust Company of New York, as Trustee of ten trusts
created under the Richard Adamson Lumpkin Grandchildren's Trust
dated September 5, 1980, one for the benefit of each of Joseph
John Keon III, Katherine Stoddert Keon, Lisa Anne Keon, Margaret
Lynley Keon, Pamela Keon Vitale, Susan Tamara Keon DeWyngaert,
Anne Romayne Sparks, Barbara Lee Sparks, Christina Louise Sparks,
and John Woodruff Sparks.
United States Trust Company of New York, as Trustee of two trusts
established by Richard Adamson Lumpkin under the Trust Agreement
dated February 6, 1970, one for the benefit of each of Margaret
Anne Keon and Mary Lee Sparks.
David R. Hodgman and Steven L. Grissom, as Trustees of ten 1990
Personal Income Trusts established by Margaret L. Keon and Mary
Lee Sparks, each dated April 20, 1990, one for the benefit of
each of Joseph John Keon III, Katherine Stoddert Keon, Lisa Anne
Keon, Margaret Lynley Keon, Pamela Keon Vitale, Susan Tamara Keon
DeWyngaert, Anne Romayne Sparks, Barbara Lee Sparks, Christina
Louise Sparks, and John Woodruff Sparks.