January 19, 2011
Carl Grivner
Chief Executive Officer
XO Holdings, Inc.
13865 Sunrise Valley Drive
Herndon, VA 20171
Dear Carl:
Carl C. Icahn, the Chairman of XO Holdings, Inc. (the "Company"), beneficially
owns a majority of the outstanding shares of the Company's common stock (the
"Common Stock") through ACF Industries Holding Corp. ("ACF Holding"). ACF
Holding is interested in acquiring, either directly or through an affiliate,
ownership of 100% of the Company, in a transaction the exact form of which would
be determined jointly. Under this proposal, holders of Common Stock of the
Company, other than ACF Holding and its affiliates, would receive consideration
of $.70 net per share in cash.
This proposed transaction would not be subject to the acquirer's ability to
obtain financing or to the results of any due diligence review of the Company.
Accordingly, ACF Holding hereby requests that you initiate the appropriate
process so that the Company can commence reviewing and considering this
proposal. We request the opportunity to have representatives of ACF Holding meet
with those persons who would be considering the proposal for the Company
together with the advisors to such persons to engage in a dialogue about why ACF
Holding believes that the proposed $.70, price net per share in cash, represents
appropriate consideration to be paid to the minority stockholders.
In connection with the foregoing, please note that in no event is ACF Holding or
its affiliates prepared to be a seller of its shares of Common Stock in any
transaction and therefore it will not sell or transfer its shares to a third
party or vote in favor of a transaction which involves the sale or transfer of
its shares to a third party.
This letter shall not constitute a binding agreement between us and no agreement
shall exist between us regarding the foregoing unless and until we enter into
mutually satisfactory definitive agreements. Please do not hesitate to contact
the undersigned at 212-702-4300 with any questions or comments.
Very truly yours,
ACF INDUSTRIES HOLDING CORP.
By: /s/ Keith Cozza
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Keith Cozza, Vice President