EXHIBIT 10.20
EXECUTION COPY
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ACC ESCROW CORP.
AMERICAN CELLULAR CORPORATION
$900,000,000
10% Series A Senior Notes due 2011
Purchase Agreement
July 25, 2003
BEAR, STEARNS & CO. INC.
MORGAN STANLEY & CO. INCORPORATED
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ACC ESCROW CORP.
AMERICAN CELLULAR CORPORATION
$900,000,000
10% SENIOR NOTES DUE 2011
PURCHASE AGREEMENT
July 25, 2003
New York, New York
BEAR, STEARNS & CO. INC.
MORGAN STANLEY & CO. INCORPORATED
c/o Bear, Stearns & Co. Inc.
383 Madison Avenue
New York, NY, 10179
Ladies & Gentlemen:
ACC Escrow Corp., a Delaware corporation (the "ISSUER") proposes to
issue and sell to Bear, Stearns & Co. Inc. ("BEAR STEARNS") and Morgan Stanley &
Co. Incorporated ("MORGAN STANLEY," and, together with Bear Stearns, the
"INITIAL PURCHASERS") $900,000,000 in aggregate principal amount of 10% Series A
Senior Notes due 2011 (the "SERIES A NOTES"), subject to the terms and
conditions set forth herein. The Issuer is a wholly-owned indirect subsidiary of
Dobson Communications Corporation, an Oklahoma corporation (the "PARENT"). The
Series A Notes will be issued pursuant to an indenture (the "INDENTURE"), to be
dated the Closing Date (as defined herein), between the Issuer and Bank of
Oklahoma, National Association, as trustee (the "TRUSTEE").
The issuance and sale of the Series A Notes pursuant to this Agreement
is part of a series of transactions designed to reorganize the ownership and
capital structure of American Cellular Corporation, a Delaware corporation (the
"COMPANY"). Such transactions, including the ACC Exchange Offer and the
Pre-Packaged Plan (each defined herein), are referred to herein as the
"REORGANIZATION." As part of the Reorganization, the Parent and the Company have
prepared an Offering Memorandum, Solicitation of Consents and Votes, Plan of
Reorganization, Disclosure Statement and Ballot, dated July 14, 2003 pursuant to
which the Company and the Parent commenced a simultaneous exchange offer (the
"ACC EXCHANGE OFFER") for any and all of the Company's outstanding 9-1/2% Senior
Subordinated Notes due 2009 (the "EXISTING NOTES") and solicitation of consents
and votes for a pre-packaged bankruptcy plan of reorganization under Chapter 11
of the U.S. Bankruptcy Code (the "PRE-PACKAGED PLAN"), in the event the
requirements of the ACC Exchange Offer are not satisfied. The ACC Exchange Offer
is subject to a variety of conditions including the condition that holders
representing 99.5% of the aggregate principal amount of the Existing Notes agree
to the ACC Exchange Offer (the "MINIMUM TENDER CONDITION"). In addition, the
Parent and the Company have entered into the ACC Exchange Offer and Plan Support
Agreement, dated July 11, 2003 (the "SUPPORT
AGREEMENT") along with ACC Acquisition LLC, a Delaware Limited Liability Company
and subsidiary of the Parent, Dobson JV Company, an Oklahoma Corporation and
subsidiary of the Parent, Dobson CC Limited Partnership, an Oklahoma limited
partnership and certain holders of the Existing Notes. In connection with the
ACC Exchange Offer, the Company and the Parent (through certain of its
subsidiaries) will provide holders of the Existing Notes who tender their
Existing Notes in the ACC Exchange Offer with up to 45,054,800 shares of the
Parent's Class A Common Stock, par value $.001 (the "PARENT COMMON STOCK"), up
to 700,000 shares of the Parent's Series F Convertible Preferred Stock, par
value $.01 (the "PARENT PREFERRED STOCK") and up to $50,000,000 in cash in
exchange for their Existing Notes (the "CASH CONSIDERATION," and together with
the Parent Common Stock and the Parent Preferred Stock, the "EXCHANGE
CONSIDERATION"). If the requisite holders of Existing Notes do not agree to the
ACC Exchange Offer, the Company and the Parent will proceed to the Pre-Packaged
Plan provided they have the approval of (a) holders of Existing Notes,
representing at least 66-2/3% of the outstanding aggregate principal amount of
the Existing Notes that actually vote on the Pre-Packaged Plan and (b) holders
representing a majority in number of the holders of Existing Notes who actually
vote on the Pre-Packaged Plan. The Company and the Parent will provide holders
of the Existing Notes with the same Exchange Consideration under the
Pre-Packaged Plan as they would have provided in the ACC Exchange Offer.
As part of the consummation of the Reorganization, the Issuer will
merge with and into the Company after which the Company will be the surviving
entity and a wholly-owned indirect subsidiary of the Parent (the "MERGER"). Upon
consummation of the Merger, the Company will succeed to the obligations of the
Issuer hereunder and under the Indenture and the Series A Notes, will execute a
supplemental indenture to the Indenture or an assumption agreement to the
Indenture in connection therewith, and the Company's obligations under the
Registration Rights Agreement (as defined herein) will become operative. In
addition, upon consummation of the Merger, the Series A Notes will become fully
and unconditionally guaranteed (the "GUARANTEES") as to payment of principal,
interest, premium and liquidated damages, if any, on an unsecured senior basis,
jointly and severally by all of the Company's subsidiaries listed on Schedule A
hereto (collectively, the "GUARANTORS").
At the Closing Date, the Issuer will deposit (i) the net proceeds from
the offering of the Series A Notes plus (ii) additional funds (which together
with the net proceeds in clause (i) will equal 100% of the aggregate principal
amount of the Series A Notes) plus (iii) accrued and unpaid interest on the
Series A Notes, to, but not including, the 90th day after the issuance of the
Series A Notes (expected to be November 6, 2003), in an escrow account (the
"ESCROW ACCOUNT") pursuant to an Escrow Agreement between the Issuer and Bank of
Oklahoma, National Association, as escrow agent (the "ESCROW AGENT"), to be
dated the Closing Date (the "ESCROW AGREEMENT"). The funds in the Escrow Account
will be released on or before November 6, 2003 to consummate the Reorganization
on the terms described in the Escrow Agreement or, in the event of a Special
Mandatory Redemption (as defined in the Offering Memorandum), to finance the
purchase price in connection therewith.
1. Issuance of Securities. The Issuer proposes, upon the terms and
subject to the conditions set forth herein, to issue and sell to the Initial
Purchasers an aggregate of $900,000,000 in principal amount of Series A Notes.
The Series A Notes and the Exchange
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Notes (as defined) issuable in exchange therefor are collectively referred to
herein as the "NOTES."
Upon original issuance thereof, and until such time as the same is no
longer required under the applicable requirements of the Securities Act of 1933,
as amended (the "ACT"), the Series A Notes (and all securities issued in
exchange therefor or in substitution thereof) shall bear the following legend:
"THIS SECURITY (OR ITS PREDECESSOR) EVIDENCED HEREBY WAS
ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION
UNDER SECTION 5 OF THE UNITED STATES SECURITIES ACT OF 1033,
AS AMENDED (THE "SECURITIES ACT"), AND THE SECURITY EVIDENCED
HEREBY MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN
THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION
THEREFROM. EACH PURCHASER OF THE SECURITY EVIDENCED HEREBY IS
HEREBY NOTIFIED THAT THE SELLER MAY BE RELYING ON THE
EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES
ACT PROVIDED BY RULE 144A THEREUNDER. THE HOLDER OF THE
SECURITY EVIDENCED HEREBY AGREES FOR THE BENEFIT OF THE ISSUER
THAT (A) SUCH SECURITY MAY BE RESOLD, PLEDGED OR OTHERWISE
TRANSFERRED ONLY (1)(a) IN THE UNITED STATES TO A PERSON WHO
THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL
BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A (b) OUTSIDE
THE UNITED STATES IN AN OFFSHORE TRANSACTION IN ACCORDANCE
WITH RULE 904 UNDER THE SECURITIES ACT, (c) IN A TRANSACTION
MEETING THE REQUIREMENTS OF RULE 144 UNDER THE SECURITIES ACT,
(d) TO AN INSTITUTIONAL "ACCREDITED INVESTOR" (AS DEFINED IN
RULE 501(a)(1), (2), (3) OR (7) OF THE SECURITIES ACT (AN
"INSTITUTIONAL ACCREDITED INVESTOR")) THAT, PRIOR TO SUCH
TRANSFER, FURNISHES THE TRUSTEE A SIGNED LETTER CONTAINING
CERTAIN REPRESENTATIONS AND AGREEMENTS (THE FORM OF WHICH CAN
BE OBTAINED FROM THE TRUSTEE) AND, IF SUCH TRANSFER IS IN
RESPECT OF AN AGGREGATE PRINCIPAL AMOUNT OF NOTES LESS THAN
$250,000, AN OPINION OF COUNSEL ACCEPTABLE TO THE ISSUER THAT
SUCH TRANSFER IS COMPLIANCE WITH THE SECURITIES ACT OR (e) IN
ACCORDANCE WITH ANOTHER EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT (AND BASED UPON AN OPINION
OF COUNSEL IF THE ISSUER SO REQUESTS), (2) TO THE ISSUER OR
(3) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT AND, IN
EACH CASE, IN ACCORDANCE WITH ANY APPLICABLE
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SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER
APPLICABLE JURISDICTION AND (B) THE HOLDERS WILL, AND EACH
SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER FROM IT
OF THE SECURITY EVIDENCED HEREBY OF THE RESALE RESTRICTIONS
SET FORTH IN (A) ABOVE."
2. Offering. The Series A Notes will be offered and sold to the Initial
Purchasers pursuant to an exemption from the registration requirements under the
Act. The Issuer and the Company have prepared a preliminary offering memorandum,
dated July 18, 2003 (the "PRELIMINARY OFFERING MEMORANDUM"), and a final
offering memorandum, dated July 25, 2003 (the "OFFERING MEMORANDUM"), relating
to the Issuer, the Company and its subsidiaries and the Series A Notes.
The Initial Purchasers have advised the Issuer and the Company that the
Initial Purchasers will make offers (the "EXEMPT RESALES") of the Series A Notes
on the terms set forth in the Offering Memorandum, as amended or supplemented,
solely to (i) persons whom the Initial Purchasers reasonably believe to be
"qualified institutional buyers," as defined in Rule 144A under the Act ("QIBS")
and (ii) non-U.S. persons outside the United States in reliance upon Regulation
S ("REGULATION S") under the Act (each, a "REG S INVESTOR"). The QIBs and the
Reg S Investors are collectively referred to herein as the "ELIGIBLE
PURCHASERS." The Initial Purchasers will offer the Series A Notes to such
Eligible Purchasers initially at a price equal to 100% of the principal amount
thereof. Such price may be changed at any time without notice.
Holders (including subsequent transferees) of the Series A Notes will
have the registration rights set forth in the registration rights agreement
relating thereto by and among the Issuer, the Company, each of the Guarantors
and the Initial Purchasers (the "REGISTRATION RIGHTS AGREEMENT"), to be dated
the Closing Date, for so long as such Series A Notes constitute "TRANSFER
RESTRICTED SECURITIES" (as defined in the Registration Rights Agreement).
Pursuant to the Registration Rights Agreement, the Issuer, the Company and the
Guarantors will agree to file with the Securities and Exchange Commission (the
"COMMISSION"), under the circumstances set forth therein, (i) a registration
statement under the Act (the "EXCHANGE OFFER REGISTRATION STATEMENT") relating
to the Company's 10% Series B Senior Notes due 2011 (the "EXCHANGE NOTES") and
Guarantees thereof to be offered in exchange for the Series A Notes and
Guarantees thereof (the "EXCHANGE OFFER") and (ii) a shelf registration
statement pursuant to Rule 415 under the Act (the "SHELF REGISTRATION STATEMENT"
and, together with the Exchange Offer Registration Statement, the "REGISTRATION
STATEMENTS") relating to the resale by certain holders of the Series A Notes,
and to use their reasonable best efforts to cause such Registration Statements
to be declared effective and to consummate the Exchange Offer. This Agreement,
the Notes, the Guarantees, the Indenture, the Registration Rights Agreement, the
Support Agreement and the Escrow Agreement are hereinafter referred to
collectively as the "OPERATIVE DOCUMENTS."
3. Purchase, Sale and Delivery. (a) On the basis of the
representations, warranties and covenants contained in this Agreement, and
subject to its terms and conditions, the Issuer agrees to issue and sell to the
Initial Purchasers, and each Initial Purchaser agrees, severally and not
jointly, to purchase from the Issuer, the principal amounts of Series A Notes
set forth
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opposite the name of such Initial Purchaser on Exhibit A hereto. The purchase
price for the Series A Notes will be $985 per $1,000 principal amount Series A
Note.
Delivery of the Series A Notes shall be made, against payment of the purchase
price therefor, at the offices of Latham & Watkins LLP, New York, New York or
such other location as may be mutually acceptable. Such delivery and payment
shall be made at 9:00 a.m., New York City time, on August 8, 2003 or at such
other time as shall be agreed upon by the Initial Purchasers and the Issuer. The
time and date of such delivery and payment are herein called the "CLOSING DATE."
On the Closing Date, one or more Series A Notes in definitive global form,
registered in the name of Cede & Co., as nominee of The Depository Trust Company
("DTC"), having an aggregate amount corresponding to the aggregate principal
amount of the Series A Notes (the "GLOBAL NOTE") sold pursuant to Exempt Resales
to Eligible Purchasers shall be delivered by the Issuer to the Initial
Purchasers (or as the Initial Purchasers direct), against payment by the Initial
Purchasers of the purchase price therefor, by wire transfer of same day funds,
to an account designated by the Issuer, provided that the Issuer shall give at
least two business days' prior written notice to the Initial Purchasers of the
information required to effect such wire transfer. The Global Note shall be made
available to the Initial Purchasers for inspection not later than 9:30 a.m. on
the business day immediately preceding the Closing Date.
4. Agreements of the Issuer, the Company and the Guarantors. Each of
the Issuer, the Company, and each of Guarantors, covenants and agrees with the
Initial Purchasers as follows:
(a) To advise the Initial Purchasers promptly and, if
requested by the Initial Purchasers, confirm such advice in writing,
(i) of the issuance by any state securities commission of any stop
order suspending the qualification or exemption from qualification of
any Notes or the related Guarantees for offering or sale in any
jurisdiction, or the initiation of any proceeding for such purpose by
any state securities commission or other regulatory authority and (ii)
of the happening of any event that makes any statement of a material
fact made in the Preliminary Offering Memorandum or the Offering
Memorandum untrue or that requires the making of any additions to or
changes in the Preliminary Offering Memorandum or the Offering
Memorandum in order to make the statements therein, in the light of the
circumstances under which they are made, not misleading. The Issuer,
the Company and the Guarantors shall use their best efforts to prevent
the issuance of any stop order or order suspending the qualification or
exemption of any Notes or the related Guarantees under any state
securities or Blue Sky laws and, if at any time any state securities
commission or other regulatory authority shall issue an order
suspending the qualification or exemption of any Notes or the related
Guarantees under any state securities or Blue Sky laws, the Issuer, the
Company and the Guarantors shall use their best efforts to obtain the
withdrawal or lifting of such order at the earliest possible time.
(b) To furnish the Initial Purchasers and those persons
identified by the Initial Purchasers to the Issuer and the Company,
without charge, as many copies of the Preliminary Offering Memorandum
and the Offering Memorandum, and any
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amendments or supplements thereto, as the Initial Purchasers may
reasonably request. The Issuer, the Company and the Guarantors consent
to the use of the Preliminary Offering Memorandum and the Offering
Memorandum, and any amendments and supplements thereto required
pursuant hereto, by the Initial Purchasers in connection with Exempt
Resales.
(c) Not to amend or supplement the Preliminary Offering
Memorandum or the Offering Memorandum during such period as in the
opinion of counsel for the Initial Purchasers the Preliminary Offering
Memorandum or the Offering Memorandum is required by law to be
delivered in connection with Exempt Resales and in connection with
market-making activities of the Initial Purchasers for so long as any
Series A Notes are outstanding unless the Initial Purchasers shall
previously have been advised thereof and shall not have objected
thereto within a reasonable time after being furnished a copy thereof.
The Issuer, the Company and the Guarantors shall promptly prepare, upon
any Initial Purchaser's request, any amendment or supplement to the
Preliminary Offering Memorandum or the Offering Memorandum that may be
necessary or advisable in connection with such Exempt Resales or such
market-making activities.
(d) If, during the period referred to in 4(c) above, any event
shall occur as a result of which, in the judgment of the Issuer, the
Company and the Guarantors or in the reasonable opinion of counsel for
the Issuer, the Company and the Guarantors or counsel for the Initial
Purchasers, it becomes necessary or advisable to amend or supplement
the Preliminary Offering Memorandum or the Offering Memorandum in order
to make the statements therein, in the light of the circumstances when
the Preliminary Offering Memorandum or the Offering Memorandum, as
applicable, is delivered to an Eligible Purchaser, not misleading, or
if it is necessary or advisable to amend or supplement the Preliminary
Offering Memorandum or the Offering Memorandum to comply with
applicable law, (i) to notify the Initial Purchasers and (ii) forthwith
to prepare an appropriate amendment or supplement to the Preliminary
Offering Memorandum or the Offering Memorandum, as applicable, so that
the statements therein as so amended or supplemented will not, in the
light of the circumstances when it is so delivered, be misleading, or
so that the Preliminary Offering Memorandum or the Offering Memorandum,
as applicable, will comply with applicable law.
(e) To cooperate with the Initial Purchasers and counsel for
the Initial Purchasers in connection with the qualification or
registration of the Series A Notes and the Guarantees thereof under the
securities or Blue Sky laws of such jurisdictions as the Initial
Purchasers may reasonably request and to continue such qualification in
effect so long as required for the Exempt Resales; provided, however,
that neither the Issuer, the Company nor any Guarantor shall be
required in connection therewith to register or qualify as a foreign
corporation where it is not now so qualified or to take any action that
would subject it to service of process in suits or taxation, in each
case, other than as to matters and transactions relating to the
Preliminary Offering Memorandum, the Offering Memorandum or Exempt
Resales, in any jurisdiction where it is not now so subject.
(f) Whether or not the transactions contemplated by this
Agreement are consummated or this Agreement becomes effective or is
terminated, to pay all costs,
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expenses, fees and document, recording and similar taxes incident to
the performance of the obligations of the Issuer, the Company and the
Guarantors hereunder, including in connection with: (i) the
preparation, printing, filing and distribution of the Preliminary
Offering Memorandum and the Offering Memorandum (including, without
limitation, financial statements) and all amendments and supplements
thereto required pursuant hereto, (ii) the preparation (including,
without limitation, duplication costs) and delivery of all agreements,
correspondence and all other documents prepared and delivered in
connection herewith and with the Exempt Resales, (iii) the issuance,
transfer and delivery of the Series A Notes and the Guarantees endorsed
thereon to the Initial Purchasers, (iv) the qualification or
registration of the Notes and the related Guarantees for offer and sale
under the securities or Blue Sky laws of the several states (including,
without limitation, the cost of printing and mailing a preliminary and
final Blue Sky Memorandum and the reasonable fees and disbursements of
counsel for the Initial Purchasers relating thereto), (v) furnishing
such copies of the Preliminary Offering Memorandum and the Offering
Memorandum, and all amendments and supplements thereto, as may be
requested for use in connection with Exempt Resales, (vi) the
preparation of certificates for the Notes (including, without
limitation, printing and engraving thereof), (vii) the fees,
disbursements and expenses of the Issuer's, the Company's and the
Guarantors' counsel and accountants, (viii) all fees and expenses
(including fees and expenses of counsel) of the Issuer, the Company and
the Guarantors in connection with the approval of the Notes by DTC for
"book-entry" transfer, (ix) rating the Notes by rating agencies, (x)
the reasonable fees and expenses of the Trustee and its counsel, (xi)
the performance by the Issuer and the Company of their other
obligations under this Agreement and the other Operative Documents and
(xii) "roadshow" travel and other expenses incurred in connection with
the marketing and sale of the Notes.
(g) To use the proceeds from the sale of the Series A Notes in
the manner described in the Offering Memorandum under the caption "Use
of Proceeds," unless the Issuer is required to redeem the Series A
Notes pursuant to a Special Mandatory Redemption (as defined in the
Offering Memorandum).
(h) Not to voluntarily claim, and to resist actively any
attempts to claim, the benefit of any usury laws against the holders of
any Notes.
(i) To do and perform all things required or necessary to be
done and performed under this Agreement by them prior to or after the
Closing Date and to satisfy all conditions precedent on their part to
the delivery of the Series A Notes.
(j) Not to sell, offer for sale or solicit offers to buy or
otherwise negotiate in respect of any security (as defined in the Act)
that would be integrated with the sale of the Series A Notes in a
manner that would require the registration under the Act of the sale to
the Initial Purchasers or the Eligible Purchasers of the Series A Notes
or to take any other action that would result in the Exempt Resales not
being exempt from registration under the Act.
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(k) For so long as any of the Notes remain outstanding and
during any period in which the Company and the Guarantors are not
subject to Section 13 or 15(d) of the Securities Exchange Act of 1934,
as amended (the "EXCHANGE ACT"), to make available to any holder or
beneficial owner of Series A Notes in connection with any sale thereof
and any prospective purchaser of such Series A Notes from such holder
or beneficial owner, the information required by Rule 144A(d)(4) under
the Act.
(l) To cause the Exchange Offer to be made in the appropriate
form to permit registered Exchange Notes and the Guarantees thereof to
be offered in exchange for the Series A Notes and the Guarantees
thereof and to comply with all applicable federal and state securities
laws in connection with the Exchange Offer.
(m) To comply with all of its agreements set forth in the
Registration Rights Agreement and all of its agreements set forth in
the representation letters to DTC relating to the approval of the Notes
by DTC for "book-entry" transfer.
(n) To effect the inclusion of the Notes in the PORTAL(sm)
Market ("PORTAL") and to obtain approval of the Series A Notes by DTC
for "book-entry" transfer.
(o) During a period of five years following the Closing Date,
to deliver without charge to any Initial Purchaser, as it may
reasonably request, promptly upon their becoming available, copies of
(i) all reports or other publicly available information that the
Issuer, the Company and the Guarantors shall mail or otherwise make
available to their securityholders and (ii) all reports, financial
statements and proxy or information statements filed by the Issuer and
the Company with the Commission or any national securities exchange and
such other publicly available information concerning the Company or any
of its subsidiaries, including without limitation, press releases.
(p) Prior to the Closing Date, to furnish to the Initial
Purchasers, as soon as they have been prepared in the ordinary course
by the Company, copies of any unaudited interim financial statements
for any period subsequent to the periods covered by the financial
statements appearing in the Offering Memorandum.
(q) Not to take, directly or indirectly, any action designed
to, or that might reasonably be expected to, cause or result in
stabilization or manipulation of the price of any security of the
Issuer or the Company to facilitate the sale or resale of the Notes.
Except as permitted by the Act, neither the Issuer nor the Company will
distribute any (i) preliminary offering memorandum, including, without
limitation, the Preliminary Offering Memorandum, (ii) offering
memorandum, including, without limitation, the Offering Memorandum, or
(iii) other offering material in connection with the offering and sale
of the Notes.
(r) During the period from the date hereof until 90 days after
the Closing Date, not to offer, sell, contract to sell or cause to be
offered, sold or contracted to sell, or otherwise dispose of any debt
securities of the Issuer, the Company or any of the
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Guarantors without the prior written consent of Bear, Stearns & Co.
Inc., on behalf of the Initial Purchasers.
(s) To cause the Issuer to deposit (i) the net proceeds from
the offering of the Series A Notes plus (ii) additional funds (which
together with the net proceeds in clause (i) will equal 100% of the
aggregate principal amount of the Series A Notes) plus (iii) accrued
and unpaid interest on the Series A Notes, to, but not including, the
90th day after the issuance of the Series A Notes (expected to be
November 6, 2003), in the Escrow Account and to comply with all of its
agreements set forth in the Escrow Agreement.
(t) Upon consummation of the Reorganization, that the Company
will assume all of Issuer's obligations under this Agreement, including
but not limited to Sections 6 and 7 hereof.
(u) Upon consummation of the Reorganization, to immediately
thereafter cause the Company and its subsidiaries to become
wholly-owned subsidiaries of the Parent.
5. Representations and Warranties. (a) The Issuer, the Company and the
Guarantors, jointly and severally, represent and warrant to the Initial
Purchasers that, as of the date hereof:
(i) The Preliminary Offering Memorandum as of its date does
not, and the Offering Memorandum as of its date and as of the Closing
Date does not and will not, and any supplement or amendment to them
will not, contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary in
order to make the statements therein, in the light of the circumstances
under which they were made, not misleading, except that the
representations and warranties contained in this paragraph shall not
apply to statements in or omissions from the Preliminary Offering
Memorandum and the Offering Memorandum (or any supplement or amendment
thereto) made in reliance upon and in conformity with information
relating to the Initial Purchasers furnished to the Issuer, the Company
and the Guarantors in writing by the Initial Purchasers expressly for
use therein. No stop order preventing the use of the Preliminary
Offering Memorandum or the Offering Memorandum, or any amendment or
supplement thereto, or any order asserting that any of the transactions
contemplated by this Agreement are subject to the registration
requirements of the Act, has been issued.
(ii) The Issuer (A) has been duly organized and is validly
existing as a corporation in good standing under the laws of its
jurisdiction of incorporation and (B) as of the date hereof does not
have, and as of the Closing Date will not have, any operations,
subsidiaries, assets, indebtedness, liabilities or obligations, other
than the Series A Notes and any obligations pursuant to this Agreement
or the other Operative Documents.
(iii) The Company and each of the Company's subsidiaries (A)
has been duly organized or incorporated and is validly existing as a
corporation in good standing under the laws of its jurisdiction of
organization or incorporation, (B) has, and after giving effect to the
Reorganization will have, all requisite corporate power and authority
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to carry on its business as it is currently being conducted and as
described in the Offering Memorandum and to own, lease and operate its
properties, and (C) is, and after giving effect to the Reorganization
will be, duly qualified and in good standing as a foreign corporation,
authorized to do business in each jurisdiction in which the nature of
its business or its ownership or leasing of property requires such
qualification, except where the failure to be so qualified could not
reasonably be expected to (x) result, individually or in the aggregate,
in a material adverse effect on the properties, business, results of
operations, condition (financial or otherwise), affairs or prospects of
the Issuer, the Company and the Company's subsidiaries, taken as a
whole, (y) interfere with or adversely affect the issuance or
marketability of the Notes or (z) in any manner draw into question, in
any material respect, the validity of this Agreement or any other
Operative Document or the transactions described in the Offering
Memorandum under the caption "Use of Proceeds" (any of the events set
forth in clauses (x), (y) or (z), a "MATERIAL ADVERSE EFFECT").
(iv) After consummation of the Reorganization, the Company
will have no subsidiaries other than the entities listed on Exhibit B
attached hereto.
(v) All of the outstanding capital stock of each subsidiary of
the Company is owned, and after giving effect to the Reorganization
will be owned, directly or indirectly, by the Company, free and clear
of any security interest, claim, lien, limitation on voting rights or
encumbrance, except for liens permitted under the terms of the
Indenture ("PERMITTED LIENS"); and all such securities have been duly
authorized, validly issued, and are fully paid and nonassessable and
were not issued in violation of any preemptive or similar rights.
(vi) After consummation of the Reorganization, there will not
be any outstanding subscriptions, rights, warrants, calls, commitments
of sale or options to acquire, or instruments convertible into or
exchangeable for, any capital stock or other equity interest of the
Issuer, the Company or any of the Company's subsidiaries.
(vii) When the Series A Notes and the Guarantees thereof are
issued and delivered pursuant to this Agreement, no Series A Note or
Guarantee thereof will be of the same class (within the meaning of Rule
144A under the Act) as securities of the Issuer or the Company or any
Guarantor that are listed on a national securities exchange registered
under Section 6 of the Exchange Act or that are quoted in a United
States automated inter-dealer quotation system.
(viii) Each of the Issuer, the Company and the Guarantors has
all requisite corporate power and authority to execute, deliver and
perform its obligations under this Agreement and each of the other
Operative Documents to which it is a party and to consummate the
transactions contemplated hereby and thereby, including, without
limitation, the corporate power and authority to issue, sell and
deliver the Notes and to issue and deliver the related Guarantees as
provided herein and therein.
(ix) This Agreement has been duly and validly authorized,
executed and delivered by the Issuer, the Company and each of the
Guarantors.
10
(x) The Indenture has been duly and validly authorized by the
Issuer and, when duly executed (assuming due execution by the Trustee)
and delivered by the Issuer, will be the legal, valid and binding
agreement of the Issuer, enforceable against it in accordance with its
terms, subject to applicable bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium and similar laws affecting the
rights and remedies of creditors generally and subject to general
principles of equity including principles of commercial reasonableness,
good faith and fair dealing (regardless of whether enforcement is
sought in a proceeding in equity or at law) and except as rights to
indemnification and contribution hereunder may be limited by federal or
state securities laws or principles of public policy. On the Closing
Date, the Indenture will conform in all material respects to the
requirements of the Trust Indenture Act of 1939, as amended (the "TRUST
INDENTURE ACT"), and the rules and regulations of the Commission
applicable to an indenture which is qualified thereunder. On the
Closing Date, the Indenture will constitute a valid and binding
obligation of the Issuer, enforceable against the Issuer in accordance
with its terms; upon consummation of the Merger, the Indenture will
constitute a valid and binding obligation of the Company and each of
the Guarantors, enforceable against the Company and each of the
Guarantors in accordance with its terms; subject, in each case, to
applicable bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium or similar laws affecting the rights and
remedies of creditors generally and subject to general principles of
equity including principles of commercial reasonableness, good faith
and fair dealing (regardless of whether enforcement is sought in a
proceeding in equity or at law) ), and except as rights to
indemnification and contribution may be limited by federal or state
securities laws or principles of public policy. The Offering Memorandum
contains a summary description of the terms of the Indenture, which
fairly presents and summarizes in all material respects the terms of
the Indenture.
(xi) The Registration Rights Agreement has been duly and
validly authorized by the Issuer. On the Closing Date, when duly
executed (assuming due execution by the Initial Purchasers) and
delivered by the Issuer, will be the legal, valid and binding
obligation of the Issuer, enforceable against each of them in
accordance with its terms; upon consummation of the Merger, the
Registration Rights Agreement will constitute a valid and binding
obligation of the Company and each of the Guarantors, enforceable
against the Company and each of the Guarantors in accordance with its
terms; subject, in each case, to applicable bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and similar laws
affecting the rights and remedies of creditors generally and subject to
general principles of equity including principles of commercial
reasonableness, good faith and fair dealing (regardless of whether
enforcement is sought in a proceeding in equity or at law), and except
as rights to indemnification and contribution may be limited by federal
or state securities laws or principles of public policy. The Offering
Memorandum contains a summary description of the terms of the
Registration Rights Agreement, which fairly presents and summarizes in
all material respects the terms of the Registration Rights Agreement.
(xii) The Escrow Agreement has been duly and validly
authorized by the Issuer and, when duly executed and delivered by the
Issuer (assuming due execution by the Escrow Agent), will be the legal,
valid and binding agreement of the Issuer,
11
enforceable against it in accordance with its terms, subject to
applicable bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium or similar laws affecting the rights and
remedies of creditors generally and subject to general principles of
equity including principles of commercial reasonableness, good faith
and fair dealing (regardless of whether enforcement is sought in a
proceeding in equity or at law), and except as rights to
indemnification and contribution may be limited by federal or state
securities laws or principles of public policy. The Offering Memorandum
contains a summary of the terms of the Escrow Agreement, which fairly
presents and summarizes in all material respects the terms of the
Escrow Agreement.
(xiii) The Agreement of Merger of the Issuer into and with the
Company, dated as of the Closing Date (the "MERGER AGREEMENT"), will
be, as of the Closing Date, duly and validly authorized, executed and
delivered by each of the Issuer and the Company and will be, as of the
Closing Date, a valid and binding agreement of each of the Issuer and
the Company, enforceable against each of them in accordance with its
terms, subject to applicable bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium or similar laws affecting the
rights and remedies of creditors generally and subject to general
principles of equity including principles of commercial reasonableness,
good faith and fair dealing (regardless of whether enforcement is
sought in a proceeding in equity or at law), and except as rights to
indemnification and contribution hereunder may be limited by federal or
state securities laws or principles of public policy.
(xiv) The Support Agreement was duly and validly authorized,
executed and delivered by the Company and constitutes a valid and
binding agreement of the Company, enforceable against it in accordance
with its terms, subject to applicable bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium or similar laws
affecting the rights and remedies of creditors generally and subject to
general principles of equity including principles of commercial
reasonableness, good faith and fair dealing (regardless of whether
enforcement is sought in a proceeding in equity or at law).
(xv) The Series A Notes have been duly and validly authorized
by the Issuer for issuance and sale to the Initial Purchasers pursuant
to this Agreement and, when issued and authenticated in accordance with
the terms of the Indenture and delivered against payment therefor in
accordance with the terms hereof and thereof, will be the legal, valid
and binding obligations of the Issuer, enforceable against it in
accordance with their terms and entitled to the benefits of the
Indenture, subject to applicable bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium and similar laws affecting the
rights and remedies of creditors generally and subject to general
principles of equity including principles of commercial reasonableness,
good faith and fair dealing (regardless of whether enforcement is
sought in a proceeding in equity or at law), and except as rights to
indemnification and contribution hereunder may be limited by federal or
state securities laws or principles of public policy. The Offering
Memorandum contains a summary description of the terms of the Series A
Notes, which fairly presents and summarizes in all material respects
the terms of the Series A Notes.
12
(xvi) The Guarantees of the Series A Notes have been duly and
validly authorized by each of the Guarantors and, when executed and
delivered in accordance with the terms of the Indenture and when the
Series A Notes have been issued and authenticated in accordance with
the terms of the Indenture and delivered against payment therefor in
accordance with the terms hereof and thereof, will be the legal, valid
and binding obligations of each of the Guarantors, enforceable against
each of them in accordance with their terms and entitled to the
benefits of the Indenture, subject to applicable bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium and
similar laws affecting the rights of creditors generally and subject to
general principles of equity including principles of commercial
reasonableness, good faith and fair dealing (regardless of whether
enforcement is sought in a proceeding in equity or at law), and except
as rights to indemnification and contribution hereunder may be limited
by federal or state securities laws or principles of public policy. The
Offering Memorandum contains a summary description of the terms of the
Guarantees, which fairly presents and summarizes in all material
respects the terms of the Guarantees.
(xvii) The Exchange Notes have been duly and validly
authorized for issuance by the Company and, when issued and
authenticated in accordance with the terms of the Exchange Offer and
the Indenture, will be the legal, valid and binding obligations of the
Company, enforceable against it in accordance with their terms and
entitled to the benefits of the Indenture, subject to applicable
bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and similar laws affecting the rights of creditors generally
and subject to general principles of equity including principles of
commercial reasonableness, good faith and fair dealing (regardless of
whether enforcement is sought in a proceeding in equity or at law), and
except as rights to indemnification and contribution hereunder may be
limited by federal or state securities laws or principles of public
policy.
(xviii) The Guarantees of the Exchange Notes have been duly
and validly authorized by each of the Guarantors and, when executed and
delivered in accordance with the terms of the Indenture and when the
Exchange Notes have been issued and authenticated in accordance with
the terms of the Exchange Offer and the Indenture, will be the legal,
valid and binding obligations of each of the Guarantors, enforceable
against each of them in accordance with their terms and entitled to the
benefits of the Indenture, subject to applicable bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium and
similar laws affecting the rights of creditors generally and subject to
general principles of equity including principles of commercial
reasonableness, good faith and fair dealing (regardless of whether
enforcement is sought in a proceeding in equity or at law), and except
as rights to indemnification and contribution hereunder may be limited
by federal or state securities laws or principles of public policy.
(xix) Each of the Issuer, the Company and each of the
Company's subsidiaries is not and, after giving effect to the Offering
and the Reorganization, will not be, (A) in violation of its charter or
bylaws, (B) in default in the performance of any bond, debenture, note,
indenture, mortgage, deed of trust or other agreement or instrument to
which it is a party or by which it is bound or to which any of its
properties is subject, which individually or in the aggregate, could
reasonably be expected to have a
13
Material Adverse Effect or (C) in violation of any local, state,
federal or foreign law, statute, ordinance, rule, regulation,
requirement, judgment or court decree (including, without limitation,
(i) environmental laws, statutes, ordinances, rules, regulations,
judgments or court decrees or (ii) the Communications Act of 1934, as
amended (the "COMMUNICATIONS ACT") and the rules, regulations and
policies of the Federal Communications Commission (the "FCC"))
applicable to it or any of its assets or properties (whether owned or
leased), which individually or in the aggregate, could reasonably be
expected to have a Material Adverse Effect. To the best knowledge of
the Issuer, the Company and the Guarantors, there exists no condition
that, with notice, the passage of time or otherwise, would constitute a
default under any such document or instrument referred to clause (B) of
the previous sentence.
(xx) None of (A) the execution, delivery or performance by the
Issuer, the Company or any of the Guarantors of this Agreement or any
of the other Operative Documents to which they are a party, (B) the
issuance and sale of the Notes, and upon consummation of the
Reorganization, the issuance of the Guarantees or (C) the consummation
by the Issuer, the Parent or the Company of the transactions described
in the Offering Memorandum under the captions "The Reorganization,"
"Related Party Transactions" or "Use of Proceeds," violates, conflicts
with or constitutes a breach of any of the terms or provisions of, or
after giving effect to the Reorganization, will violate, conflict with
or constitute a breach of any of the terms or provisions of, or a
default under (or an event that with notice or the lapse of time, or
both, would constitute a default under), or require consent under
(including after giving effect to the Reorganization), or result in
(including after giving effect to the Reorganization), the imposition
of a lien or encumbrance on any properties of the Issuer, the Company
or any of the Company's subsidiaries, or an acceleration of any
indebtedness of the Issuer, the Company or any of the Company's
subsidiaries pursuant to, (1) the charter or bylaws of the Issuer, the
Company or any of the Company's subsidiaries, (2) any bond, debenture,
note, indenture, mortgage, deed of trust or other agreement or
instrument to which the Issuer, the Company or any of the Company's
subsidiaries is a party or by which any of them or their property is or
may be bound, (3) any statute, rule or regulation (including, without
limitation, (i) environmental laws, statutes, ordinances, rules,
regulations, judgments or court decrees or (ii) the Communications Act
and the rules, regulations and policies of the FCC applicable to the
Issuer, the Company or any of the Company's subsidiaries or any of
their assets or properties or (4) any judgment, order or decree of any
court or governmental agency or authority having jurisdiction over the
Issuer, the Company or any of the Company's subsidiaries or any of
their assets or properties. No consent, approval, authorization or
order of, or filing, registration, qualification, license or permit of
or with, (A) any court or governmental agency, body or administrative
agency or (B) any other person is required for, or after giving effect
to the Reorganization will be required for (1) the execution, delivery
and performance by each of the Issuer, the Company and the Guarantors
of this Agreement or any of the other Operative Documents to which it
is a party or (2) the issuance and sale of the Notes, and upon
consummation of the Reorganization, the issuance of the Guarantees and
the transactions contemplated hereby and thereby, except such as have
been or will be obtained and made on or prior to the Closing Date (or,
in the case of the Registration Rights Agreement, will be obtained
14
and made under the Act, the Trust Indenture Act, and state securities
or Blue Sky laws and regulations).
(xxi) There is (A) no action, suit, investigation or
proceeding before or by any court, arbitrator or governmental agency,
body or official, domestic or foreign, now, or after giving effect to
the Reorganization, pending or, to the best knowledge of the Issuer,
the Company and the Guarantors, threatened or contemplated to which the
Issuer, the Company or any of the Company's subsidiaries is or may be a
party or to which the business or property of the Issuer, the Company
or any of the Company's subsidiaries, is or may be subject, (B) no
statute, rule, regulation or order that has been enacted, adopted or
issued by any governmental agency or that has been proposed by any
governmental body and (C) no injunction, restraining order or order of
any nature by a federal or state court or foreign court of competent
jurisdiction to which the Issuer, the Company or any of the Company's
subsidiaries is or may be subject, or after giving effect to the
Reorganization will or may be subject, or to which the business, assets
or property of the Issuer, the Company or any of the Company's
subsidiaries is or may be subject, or after giving effect to the
Reorganization, will or may be subject, that, in the case of clauses
(A), (B) and (C) above, (1) is required to be disclosed in the
Preliminary Offering Memorandum and the Offering Memorandum and that is
not so disclosed, (2) could, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect or (3)
challenges in any respect or seeks to delay or prevent the issuance and
sale of the Notes, the Reorganization or the Merger.
(xxii) No action has been taken and no statute, rule,
regulation or order has been enacted, adopted or issued by any
governmental agency that prevents the issuance of the Notes or the
Guarantees or prevents or suspends the use of the Offering Memorandum;
no injunction, restraining order or order of any nature by a federal or
state court of competent jurisdiction has been issued that prevents the
issuance of the Notes or the Guarantees or prevents or suspends the
sale of the Notes or the Guarantees in any jurisdiction referred to in
Section 4(e) hereof; and every request of any securities authority or
agency of any jurisdiction for additional information has been complied
with in all material respects.
(xxiii) There is, or after giving effect to the Reorganization
will be (A) no significant unfair labor practice complaint pending
against the Company or any of the Company's subsidiaries nor, to the
best knowledge of the Company, threatened against any of them, before
the National Labor Relations Board, any state or local labor relations
board or any foreign labor relations board, and no significant
grievance or significant arbitration proceeding arising out of or under
any collective bargaining agreement is so pending against the Company
or any of the Company's subsidiaries or, to the best knowledge of the
Company, threatened against any of them, (B) no significant strike,
labor dispute, slowdown or stoppage pending against the Company or any
of the Company's subsidiaries nor, to the best knowledge of the
Company, threatened against any of them and (C) to the best knowledge
of the Company, no union representation question existing with respect
to the employees of the Company or any of the Company's subsidiaries.
To the best knowledge of the Company, no collective bargaining
organizing activities are taking place with respect to the Company or
any of the Company's subsidiaries. None of the Company or any of the
Company's
15
subsidiaries has violated (A) any federal, state or local law or
foreign law relating to discrimination in hiring, promotion or pay of
employees, (B) any applicable wage or hour laws or (C) any provision of
the Employee Retirement Income Security Act of 1974, as amended
("ERISA"), or the rules and regulations thereunder, except those
violations that could not reasonably be expected to have a Material
Adverse Effect.
(xxiv) None of the Company or any of the Company's
subsidiaries has, or after giving effect to the Reorganization will
have, violated, or is in violation of, any foreign, federal, state or
local law or regulation relating to the protection of human health and
safety, the environment or hazardous or toxic substances or wastes,
pollutants or contaminants (collectively, "ENVIRONMENTAL LAWS"), which
violation could reasonably be expected to have a Material Adverse
Effect.
(xxv) There is no alleged liability, or to the best knowledge
of the Company, potential liability (including, without limitation,
alleged or potential liability or investigatory costs, cleanup costs,
governmental response costs, natural resource damages, property
damages, personal injuries or penalties) of the Company or any of the
Company's subsidiaries arising out of, based on or resulting from (A)
the presence or release into the environment of any Hazardous Material
(as defined) at any location, whether or not owned by the Company or
such subsidiary, as the case may be, or (B) any violation or alleged
violation of any Environmental Law, which alleged or potential
liability is required to be disclosed in the Offering Memorandum, other
than as disclosed therein, or could reasonably be expected to have a
Material Adverse Effect. The term "HAZARDOUS MATERIAL" means (i) any
"hazardous substance" as defined by the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, as amended, (ii) any
"hazardous waste" as defined by the Resource Conservation and Recovery
Act, as amended, (iii) any petroleum or petroleum product, (iv) any
polychlorinated biphenyl, and (v) any pollutant or contaminant or
hazardous, dangerous or toxic chemical, material, waste or substance
regulated under or within the meaning of any other law relating to
protection of human health or the environment or imposing liability or
standards of conduct concerning any such chemical material, waste or
substance.
(xxvi) Each of the Company and the Company's subsidiaries has,
and after giving effect to the Reorganization will have, such permits,
licenses, franchises and authorizations of governmental or regulatory
authorities ("PERMITS"), including, without limitation, under any
applicable Environmental Laws, as are necessary to own, lease and
operate its respective properties and to conduct its businesses; each
of the Company and the Company's subsidiaries has, and after giving
effect to the Reorganization will have, fulfilled and performed all of
its obligations with respect to such permits and no event has, or after
giving effect to the Reorganization will have, occurred which allows,
or after notice or lapse of time would allow, revocation or termination
thereof or results in any other material impairment of the rights of
the holder of any such permit, except, in an case, where the failure to
have such permits or to fulfill and perform such obligations could not,
individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect; and, except as described in the Offering
Memorandum, such permits
16
contain, and after giving effect to the Reorganization will contain, no
restrictions that are materially burdensome to the Company or such
subsidiary, as the case may be.
(xxvii) Each of the Company and the Company's subsidiaries
has, and after giving effect to the Reorganization will have, (A) good
and defensible title to all of the properties and assets described in
the Offering Memorandum as owned by it, free and clear of all liens,
charges, encumbrances and restrictions (except for Permitted Liens and
taxes not yet payable), (B) peaceful and undisturbed possession under
all material leases to which any of them is a party as lessee and each
of which lease is valid and binding and no default exists thereunder,
except for defaults that could not reasonably be expected to have a
Material Adverse Effect, (C) all licenses, certificates, permits,
authorizations, approvals, franchises and other rights from, and has
made all declarations and filings with, all federal, state and local
authorities, all self-regulatory authorities and all courts and other
tribunals (each, an "AUTHORIZATION") necessary to engage in the
business conducted by any of them in the manner described in the
Offering Memorandum, except where the failure to have such
Authorizations could not reasonably be expected to have a Material
Adverse Effect and (D) no reason to believe that any governmental body
or agency is considering limiting, suspending or revoking any such
Authorization. All such Authorizations are valid and in full force and
effect and each of the Company and the Company's subsidiaries is in
compliance in all material respects with the terms and conditions of
all such Authorizations and with the rules and regulations of the
regulatory authorities having jurisdiction with respect thereto. All
material leases to which the Company or any of the Company's
subsidiaries is a party are, and after giving effect to the
Reorganization will be, valid and binding and no default by the Company
or such subsidiary, as the case may be, has occurred and is continuing
thereunder, or after giving effect to the Reorganization will have
occurred and will be continuing thereunder, and, to the best knowledge
of the Company, no material defaults by the landlord are existing under
any such lease, or after giving effect to the Reorganization will be
existing under any such lease, except those defaults that could not
reasonably be expected to have a Material Adverse Effect.
(xxviii) Each of the Company and the Company's subsidiaries
owns, possesses or has the right to employ, and after giving effect to
the Reorganization will own, possess or have the right to employ, all
patents, patent rights, licenses (including all state, local or other
regulatory licenses), inventions, copyrights, know-how (including trade
secrets and other unpatented and/or unpatentable proprietary or
confidential information, software, systems or procedures), trademarks,
service marks and trade names, inventions, computer programs, technical
data and information (collectively, the "INTELLECTUAL PROPERTY")
presently employed by it in connection with the businesses now operated
by it or that are proposed to be operated by it, including as a result
of the Reorganization, free and clear of and without violating any
right, claimed right, charge, encumbrance, pledge, security interest,
restriction or lien of any kind of any other person, and neither the
Company nor any of the Company's subsidiaries has received any notice
of infringement of or conflict with asserted rights of others with
respect to any of the foregoing. The use of the Intellectual Property
in connection with the business and operations of the Company or any of
the Company's subsidiaries does not infringe, and after giving effect
to the Reorganization will not infringe, on the rights of any person,
except such infringements
17
as, individually or in the aggregate, could not reasonably be expected
to have a Material Adverse Effect.
(xxix) All material tax returns required to be filed by the
Issuer, the Company or any of the Company's subsidiaries in all
jurisdictions have, and after giving effect to the Reorganization will
have, been so filed and are accurate in all material respects. All
taxes, including withholding taxes, penalties and interest,
assessments, fees and other charges shown due on such returns or
claimed to be due from such entities or that are due and payable have
been paid, other than those being contested in good faith and for which
adequate reserves have been provided or those currently payable without
penalty or interest. To the knowledge of the Issuer, the Company and
the Company's subsidiaries, there are, and after giving effect to the
Reorganization will be, no material proposed additional tax assessments
against the Issuer, the Company or any of the Company's subsidiaries,
or the assets or property of the Issuer, the Company or any of the
Company's subsidiaries, except those tax assessments for which adequate
reserves have been established.
(xxx) Each of the Issuer, the Company and the Company's
subsidiaries maintains, and after giving effect to the Reorganization
will maintain, a system of internal accounting controls sufficient to
provide reasonable assurance that: (A) transactions are executed in
accordance with management's general or specific authorizations; (B)
transactions are recorded as necessary to permit preparation of
financial statements in conformity with generally accepted accounting
principles and to maintain accountability for assets; (C) access to
assets is permitted only in accordance with management's general or
specific authorization; and (D) the recorded accountability for assets
is compared with the existing assets at reasonable intervals and
appropriate action is taken with respect thereto.
(xxxi) Each of the Company and the Company's subsidiaries
maintains, and after giving effect to the Reorganization will maintain,
insurance covering its properties, operations, personnel and
businesses, insuring against such losses and risks as are consistent
with customary industry practice to protect the Company and the
Company's subsidiaries and their respective businesses. Neither the
Company nor any of the Company's subsidiaries has received notice from
any insurer or agent of such insurer that substantial capital
improvements or other expenditures will have to be made in order to
continue such insurance.
(xxxii) The Company has established and maintains disclosure
controls and procedures (as such term is defined in Rule 13a-14 under
the Exchange Act), which (i) are designed to ensure that material
information relating to the Company, including its consolidated
subsidiaries, is made known to the Company's principal executive
officer and its principal financial officer by others within those
entities, particularly during the periods in which the periodic reports
required under the Exchange Act are being prepared; (ii) have been
evaluated for effectiveness as of a date within 90 days prior to the
filing of the Company's most recent annual or quarterly report filed
with the Commission; and (iii) are effective in all material respects
to perform the functions for which they were established. Based on the
evaluation of its disclosure controls and
18
procedures, the Company is not aware of (i) any significant deficiency
in the design or operation of internal controls which could adversely
affect the Company's ability to record, process, summarize and report
financial data or any material weaknesses in internal controls or (ii)
any fraud, whether or not material, that involves management or other
employees who have a significant role in the Company's internal
controls. Since the date of the most recent evaluation of such
disclosure controls and procedures, there have been no significant
changes in internal controls or in other factors that could
significantly affect internal controls, including any corrective
actions with regard to significant deficiencies and material
weaknesses.
(xxxiii) Except as disclosed in the Offering Memorandum, no
relationship, direct or indirect, exists between or among the Company
or any of the Company's subsidiaries on the one hand, and the
directors, officers, stockholders, customers or suppliers of the
Company or any of the Company's subsidiaries on the other hand, which
would be required by the Act to be described in the Offering Memorandum
if the Offering Memorandum were a prospectus included in a registration
statement on Form S-1 filed with the Commission.
(xxxiv) None of the Issuer, the Company or any of the
Company's subsidiaries is, or after giving effect to the Offering and
the Reorganization and applying the net proceeds as described in the
Offering Memorandum under the caption "Use of Proceeds" will be, an
"investment company" or a company "controlled" by an "investment
company" within the meaning of the Investment Company Act of 1940, as
amended (the "INVESTMENT COMPANY ACT").
(xxxv) There are no holders of securities of the Issuer, the
Company or any of the Company's subsidiaries who, by reason of the
execution by the Issuer, the Company or any of the Guarantors of this
Agreement or any other Operative Document to which it is a party or the
consummation by the Issuer, the Company or the Guarantors of the
transactions contemplated hereby and thereby, have the right to request
or demand that the Issuer, the Company or any of the Company's
subsidiaries register under the Act or analogous foreign laws and
regulations securities held by them other than pursuant to the
Registration Rights Agreement.
(xxxvi) None of the Issuer, the Company or any of the
Company's subsidiaries has (A) taken, and none of the Issuer, the
Company or any of the Company's subsidiaries will take, directly or
indirectly, any action designed to, or that might reasonably be
expected to, cause or result in stabilization or manipulation of the
price of any security of the Issuer, the Company or any of the
Company's subsidiaries to facilitate the sale or resale of the Notes or
(B) since the date of the Preliminary Offering Memorandum (1) sold, bid
for, purchased or paid any person any compensation for soliciting
purchases of the Notes or (2) paid or agreed to pay to any person any
compensation for soliciting another to purchase any other securities of
the Issuer, the Company or any of the Company's subsidiaries.
(xxxvii) The accountants who have certified or will certify
the financial statements included or to be included as part of the
Offering Memorandum are
19
independent accountants as required by the Act. The historical
financial statements, together with related schedules and notes thereto
included in the Offering Memorandum, comply as to form in all material
respects with the requirements applicable to registration statements on
Form S-1 under the Act and present fairly in all material respects the
financial position and results of operations of the Issuer, the Company
and the Company's subsidiaries at the dates and for the periods
indicated. Except as otherwise specifically stated in the Offering
Memorandum, such financial statements have been prepared in accordance
with generally accepted accounting principles applied on a consistent
basis throughout the periods presented. The pro forma financial
statements included in the Offering Memorandum have been prepared on a
basis consistent with such historical statements of the Company, except
for the pro forma adjustments specified therein, and give effect to
assumptions made on a reasonable basis and present fairly in all
material respects the historical and proposed transactions contemplated
by this Agreement, the Reorganization and the other Operative
Documents; and such pro forma financial statements comply as to form in
all material respects with the requirements applicable to pro forma
financial statements included in registration statements on Form S-1
under the Act, except as expressly stated therein. The other financial
and statistical information and data included in the Offering
Memorandum derived from the historical and pro forma financial
statements, are accurately presented in all material respects and
prepared on a basis consistent with the financial statements,
historical and pro forma, included in the Offering Memorandum and the
books and records of the Issuer, the Company and the Company's
subsidiaries.
(xxxviii) Assuming that the representations and warranties of
the Initial Purchasers contained in Section 5(b) are true, correct and
complete and assuming compliance by the Initial Purchasers with their
respective covenants in Section 5(b), no registration under the Act of
the Series A Notes is required for the sale of the Series A Notes to
the Initial Purchasers as contemplated hereby or for the Exempt
Resales. No form of general solicitation or general advertising (as
defined in Regulation D under the Act) was used by the Issuer or the
Company or any of their representatives (other than the Initial
Purchasers, as to which the Issuer and the Company make no
representation or warranty) in connection with the offer and sale of
any of the Series A Notes or in connection with Exempt Resales,
including, but not limited to, articles, notices or other
communications published in any newspaper, magazine, or similar medium
or broadcast over television or radio, or any seminar or meeting whose
attendees have been invited by any general solicitation or general
advertising. No securities of the same class as the Notes have been
issued and sold by the Issuer, the Company or any of the Company's
subsidiaries within the six-month period immediately prior to the date
hereof.
(xxxix) The execution and delivery of this Agreement, the
other Operative Documents and the sale of the Series A Notes to be
purchased by Eligible Purchasers will not involve any prohibited
transaction within the meaning of Section 406 of ERISA or Section 4975
of the Internal Revenue Code of 1986. The representation made by the
Issuer and the Company in the preceding sentence is made in reliance
upon and subject to the accuracy of, and compliance with, the
representations and covenants made or deemed made by Eligible
Purchasers as set forth in the Offering Memorandum under the caption
"Notice to Investors."
20
(xl) The statistical and market-related data included in the
Offering Memorandum are based on or derived from sources which the
Issuer, the Company and the Guarantors believe to be reliable and
accurate in all material respects.
(xli) Since the respective dates as of which information is
given in the Offering Memorandum, (i) there has not been any material
adverse change, or any development that is reasonably likely to result
in a material adverse change, in the capital stock or the long-term
debt, or material increase in the short-term debt, of the Issuer, the
Company or any of the Company's subsidiaries from that set forth in the
Offering Memorandum, (ii) no dividend or distribution of any kind shall
have been declared, paid or made by the Issuer, the Company or any of
the Company's subsidiaries on any class of its capital stock and (iii)
none of the Issuer, the Company or any of the Company's subsidiaries
shall have incurred any liabilities or obligations, direct or
contingent, that are material, individually or in the aggregate, to the
Issuer, the Company and the Company's subsidiaries, taken as a whole,
and that are required to be disclosed on a balance sheet or notes
thereto in accordance with generally accepted accounting principles and
are not disclosed on the latest balance sheet or notes thereto included
in the Offering Memorandum. Since the date hereof and since the dates
as of which information is given in the Offering Memorandum, there
shall not have occurred any material adverse change, or any development
that is reasonably likely to result in a material adverse change, in
the business, prospects, financial condition or results of operation of
the Issuer, the Company and the Company's subsidiaries, taken as a
whole.
(xlii) Each of the Preliminary Offering Memorandum and the
Offering Memorandum, as of its date, and each amendment or supplement
thereto, as of its date, contains the information specified in, and
meets the requirements of, Rule 144A(d)(4) under the Act.
(xliii) Prior to the effectiveness of any Registration
Statement, the Indenture is not required to be qualified under the
Trust Indenture Act.
(xliv) None of the Issuer, the Company, the Guarantors nor any
of their respective affiliates or any person acting on its or their
behalf (other than the Initial Purchaser, as to whom the Issuer, the
Company and the Guarantors make no representation) has engaged or will
engage in any directed selling efforts within the meaning of Regulation
S with respect to the Series A Notes.
(xlv) The Series A Notes offered and sold in reliance on
Regulation S have been and will be offered and sold only in offshore
transactions.
(xlvi) The sale of the Series A Notes pursuant to Regulation S
is not part of a plan or scheme to evade the registration provisions of
the Act.
(xlvii) The Issuer, the Company, the Guarantors and their
respective affiliates and all persons acting on their behalf (other
than the Initial Purchasers, as to whom the Issuer, the Company and the
Guarantors make no representation) have complied with and will comply
with the offering restrictions requirements of Regulation S in
connection
21
with the offering of the Series A Notes outside the United States and,
in connection therewith, the Offering Memorandum will contain the
disclosure required by Rule 902(g)(2).
(xlviii) The Series A Notes sold in reliance on Regulation S
will be represented upon issuance by a temporary global security that
may not be exchanged for definitive securities until the expiration of
the 40-day distribution compliance period referred to in Rule 903(c)(3)
of the Act and only upon certification of beneficial ownership of such
Series A Notes by non-U.S. persons or U.S. persons who purchased such
Series A Notes in transactions that were exempt from the registration
requirements of the Act.
(xlix) None of the execution, delivery and performance of this
Agreement, the issuance and sale of the Notes, the application of the
proceeds from the issuance and sale of the Notes and the consummation
of the transactions contemplated thereby as set forth in the Offering
Memorandum, will violate Regulations T, U or X promulgated by the Board
of Governors of the Federal Reserve System or analogous foreign laws
and regulations.
(l) Neither the Issuer, the Company nor any Guarantor,
including after giving effect to the Reorganization, intends to, nor
believes that it will, incur debts beyond its ability to pay such debts
as they mature. The present fair saleable value of the assets of the
Company and each Guarantor exceeds, and following consummation of the
Reorganization will exceed, the amount that will be required to be paid
on or in respect of its existing debts and other liabilities (including
contingent liabilities) as they become absolute and matured. The assets
of the Company do not constitute unreasonably small capital to carry
out its business as conducted or as proposed to be conducted. Upon the
issuance of the Notes and the Guarantees, the present fair saleable
value of the assets of the Company and each Guarantor will exceed the
amount that will be required to be paid on or in respect of its
existing debts and other liabilities (including contingent liabilities)
as they become absolute and matured. Upon the issuance of the Notes and
the Guarantees, the assets of the Company and each Guarantor will not
constitute unreasonably small capital to carry out its business as now
conducted, including the capital needs of the Company and such
Guarantor, taking into account the projected capital requirements and
capital availability, and after giving effect to the Reorganization.
(li) Except pursuant to this Agreement, there are no
contracts, agreements or understandings between the Issuer, the Company
and the Company's subsidiaries (including after giving effect to the
Reorganization) and any other person that would give rise to a valid
claim against the Issuer, the Company or any of the Company's
subsidiaries or the Initial Purchasers for a brokerage commission,
finder's fee or like payment in connection with the issuance, purchase
and sale of the Notes.
(lii) There exist no conditions that would constitute a
default (or an event which with notice or the lapse of time, or both,
would constitute a default) under any of the Operative Documents.
22
(liii) Each certificate signed by any officer of the Issuer,
the Company or any Guarantor and delivered to the Initial Purchasers or
counsel for the Initial Purchasers shall be deemed to be a
representation and warranty by the Issuer, the Company or such
Guarantor, as the case may be, to the Initial Purchasers as to the
matters covered thereby.
Each of the Issuer, the Company and the Guarantors acknowledge that the
Initial Purchasers and, for purposes of the opinions to be delivered to the
Initial Purchasers pursuant to Section 8 hereof, counsel for the Issuer, the
Company and the Guarantors and counsel for the Initial Purchasers, will rely
upon the accuracy and truth of the foregoing representations and hereby consent
to such reliance.
Each of the Initial Purchasers, severally and not jointly, represents and
warrants to the Issuer, the Company and the Guarantors that:
(liv) Such Initial Purchaser is a QIB, with such knowledge and
experience in financial and business matters as are necessary in order
to evaluate the merits and risks of an investment in the Series A
Notes.
(lv) Such Initial Purchaser (A) is not acquiring the Series A
Notes with a view to any distribution thereof that would violate the
Act or the securities laws of any state of the United States or any
other applicable jurisdiction and (B) will be reoffering and reselling
the Series A Notes only to QIBs in reliance on the exemption from the
registration requirements of the Act provided by Rule 144A and in
offshore transactions in reliance upon Regulation S under the Act.
(lvi) No form of general solicitation or general advertising
(within the meaning of Regulation D under the Act) has been or will be
used by such Initial Purchaser or any of its representatives in
connection with the offer and sale of any of the Series A Notes,
including, but not limited to, articles, notices or other
communications published in any newspaper, magazine, or similar medium
or broadcast over television or radio, or any seminar or meeting whose
attendees have been invited by any general solicitation or general
advertising.
(lvii) Such Initial Purchaser agrees that, in connection with
the Exempt Resales, it will solicit offers to buy the Series A Notes
only from, and will offer to sell the Series A Notes only to, Eligible
Purchasers. Such Initial Purchaser further (A) agrees that it will
offer to sell the Series A Notes only to, and will solicit offers to
buy the Series A Notes only from (1) Eligible Purchasers that the
Initial Purchaser reasonably believes are QIBs and (2) Reg S Investors
and (B) acknowledges and agrees that, in the case of such QIBs and such
Reg S Investors, that such Series A Notes will not have been registered
under the Act and may be resold, pledged or otherwise transferred only
(x)(I) to a person whom the seller reasonably believes is a QIB
purchasing for its own account or for the account of a QIB in a
transaction meeting the requirements of Rule 144A under the Act, (II)
in an offshore transaction (as defined in Rule 902 under the Act)
meeting the requirements of Rule 903 or 904 under the Act, (III) in a
transaction meeting the requirements of Rule 144 under the Act, (IV) to
an Accredited Investor that, prior to such transfer, furnishes the
Trustee a signed letter containing certain representations and
23
agreements relating to the registration of transfer of such Series A
Notes (the form of which can be obtained from the Trustee) or (V) in
accordance with another exemption from the registration requirements of
the Act (and based upon an opinion of counsel if the Issuer and the
Company so request), (y) to the Issuer or after the consummation of the
Reorganization, to the Company, (z) pursuant to an effective
registration statement under the Act and, in each case, in accordance
with any applicable securities laws of any state of the United States
or any other applicable jurisdiction and (C) acknowledges that it will,
and each subsequent holder is required to, notify any purchaser of the
security evidenced thereby of the resale restrictions set forth in (B)
above.
(lviii) Such Initial Purchaser and its affiliates or any
person acting on its or their behalf have not engaged or will not
engage in any directed selling efforts within the meaning of Regulation
S with respect to the Series A Notes or the Guarantees thereof.
(lix) The Series A Notes offered and sold by such Initial
Purchaser pursuant hereto in reliance on Regulation S have been and
will be offered and sold only in offshore transactions.
(lx) The sale of Series A Notes offered and sold by such
Initial Purchaser pursuant hereto in reliance on Regulation S is not
part of a plan or scheme to evade the registration provisions of the
Act.
(lxi) Such Initial Purchaser agrees that it has not offered or
sold and will not offer or sell the Series A Notes in the United States
or to, or for the benefit or account of, a U.S. Person (other than a
distributor), in each case, as defined in Rule 902 under the Act (i) as
part of its distribution at any time and (ii) otherwise until 40 days
after the later of the commencement of the offering of the Series A
Notes pursuant hereto and the Closing Date, other than in accordance
with Regulation S of the Act or another exemption from the registration
requirements of the Act. Such Initial Purchaser agrees that, during
such 40-day distribution compliance period, it will not cause any
advertisement with respect to the Series A Notes (including any
"tombstone" advertisement) to be published in any newspaper or
periodical or posted in any public place and will not issue any
circular relating to the Series A Notes, except such advertisements as
permitted by and include the statements required by Regulation S.
(lxii) Such Initial Purchaser agrees that, at or prior to
confirmation of a sale of Series A Notes by it to any distributor,
dealer or person receiving a selling concession, fee or other
remuneration during the 40-day distribution compliance period referred
to in Rule 903(b)(3) under the Act, it will send to such distributor,
dealer or person receiving a selling concession, fee or other
remuneration a confirmation or notice to substantially the following
effect:
"The Series A Notes covered hereby have not been registered under the U.S.
Securities Act of 1933, as amended (the "SECURITIES ACT"), and may not be
offered and sold within the United States or to, or for the account or benefit
of, U.S. persons (i) as part of your distribution at any time or (ii) otherwise
until 40 days after the later of the commencement of the Offering and the
Closing Date, except in either case in accordance with Regulation S under the
Securities Act (or
24
Rule 144A or to Accredited Institutions in transactions that are exempt from the
registration requirements of the Securities Act), and in connection with any
subsequent sale by you of the Series A Notes covered hereby in reliance on
Regulation S during the period referred to above to any distributor, dealer or
person receiving a selling concession, fee or other remuneration, you must
deliver a notice to substantially the foregoing effect. Terms used above have
the meanings assigned to them in Regulation S."
(lxiii) Such Initial Purchaser agrees that the Series A Notes
offered and sold in reliance on Regulation S will be represented upon
issuance by a global security that may not be exchanged for definitive
securities until the expiration of the 40-day distribution compliance
period referred to in Rule 903(c)(3) of the Act and only upon
certification of beneficial ownership of such Series A Notes by
non-U.S. persons or U.S. persons who purchased such Series A Notes in
transactions that were exempt from the registration requirements of the
Act.
(lxiv) The Initial Purchasers acknowledge that the Issuer, the
Company and the Company's subsidiaries and, for purposes of the
opinions to be delivered to the Initial Purchasers pursuant to Section
8 hereof, counsel for the Issuer, the Company and the Company's
subsidiaries and counsel for the Initial Purchasers will rely upon the
accuracy and truth of the foregoing representations and hereby consent
to such reliance.
6. Indemnification.
(a) Each of the Issuer, the Company and the Guarantors,
jointly and severally, agree to indemnify and hold harmless (i) each
Initial Purchaser, (ii) each person, if any, who controls an Initial
Purchaser within the meaning of Section 15 of the Act or Section 20(a)
of the Exchange Act and (iii) the respective officers, directors,
partners, employees, representatives and agents of the Initial
Purchasers or any controlling person to the fullest extent lawful, from
and against any and all losses, liabilities, claims, damages and
expenses whatsoever (including but not limited to reasonable attorneys'
fees and any and all expenses whatsoever reasonably incurred in
investigating, preparing or defending against any investigation or
litigation, commenced or threatened, or any claim whatsoever, and any
and all amounts paid in settlement of any claim or litigation), joint
or several, to which they or any of them may become subject under the
Act, the Exchange Act or otherwise, insofar as such losses,
liabilities, claims, damages or expenses (or actions in respect
thereof) arise out of or are based upon any untrue statement or alleged
untrue statement of a material fact contained in the Preliminary
Offering Memorandum or the Offering Memorandum, or in any supplement
thereto or amendment thereof, 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; provided, however, that neither the Issuer, the Company nor
any Guarantor will be liable in any such case to the extent, but only
to the extent, that any such loss, liability, claim, damage or expense
arises out of or is based upon any such untrue statement or alleged
untrue statement or omission or alleged omission made therein in
reliance upon and in conformity with information relating to the
Initial Purchasers furnished to the Issuer, the Company and the
Guarantors in writing by or on behalf of the Initial Purchasers
expressly for use therein.
25
This indemnity agreement will be in addition to any liability that the
Issuer, the Company and the Guarantors may otherwise have, including
under this Agreement.
(b) Each Initial Purchaser agrees, severally and not jointly,
to indemnify and hold harmless (i) the Issuer, the Company and the
Guarantors, (ii) each person, if any, who controls the Issuer, the
Company or any of the Guarantors within the meaning of Section 15 of
the Act or Section 20(a) of the Exchange Act, and (iii) the officers,
directors, partners, employees, representatives and agents of the
Issuer, the Company and the Guarantors, against any losses,
liabilities, claims, damages and expenses whatsoever (including but not
limited to reasonable attorneys' fees and any and all expenses
whatsoever reasonably incurred in investigating, preparing or defending
against any investigation or litigation, commenced or threatened, or
any claim whatsoever and any and all amounts paid in settlement of any
claim or litigation), joint or several, to which they or any of them
may become subject under the Act, the Exchange Act or otherwise,
insofar as such losses, liabilities, claims, damages or expenses (or
actions in respect thereof) arise out of or are based upon any untrue
statement or alleged untrue statement of a material fact contained in
the Preliminary Offering Memorandum or the Offering Memorandum, or in
any amendment thereof or supplement thereto, or arise out of or are
based upon the omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made,
not misleading, in each case to the extent, but only to the extent,
that any such loss, liability, claim, damage or expense arises out of
or is based upon any untrue statement or alleged untrue statement or
omission or alleged omission made therein in reliance upon and in
conformity with information relating to such Initial Purchaser
furnished to the Issuer, the Company and the Guarantors in writing by
or on behalf of such Initial Purchaser expressly for use therein;
provided, however, that in no case shall any Initial Purchaser be
liable or responsible for any amount in excess of the discounts and
commissions received by such Initial Purchaser. This indemnity will be
in addition to any liability that the Initial Purchasers may otherwise
have, including under this Agreement.
(c) Promptly after receipt by an indemnified party under
subsection (a) or (b) above of notice of the commencement of any
action, such indemnified party shall, if a claim in respect thereof is
to be made against the indemnifying party under such subsection, notify
each party against whom indemnification is to be sought in writing of
the commencement thereof (but the failure so to notify an indemnifying
party shall not relieve it from any liability which it may have under
this Section 6 except to the extent that it has been prejudiced in any
material respect by such failure or from any liability which it may
otherwise have). In case any such action is brought against any
indemnified party, and it notifies an indemnifying party of the
commencement thereof, the indemnifying party will be entitled to
participate therein, and to the extent it may elect by written notice
delivered to the indemnified party promptly after receiving the
aforesaid notice from such indemnified party, to assume the defense
thereof with counsel reasonably satisfactory to such indemnified party.
Notwithstanding the foregoing, the indemnified party or parties shall
have the right to employ its or their own counsel in any such case, but
the fees and expenses of such counsel shall be at the expense of such
indemnified party or parties unless (i) the employment of such counsel
shall have been
26
authorized in writing by the indemnifying parties in connection with
the defense of such action, (ii) the indemnifying parties shall not
have employed counsel to take charge of the defense of such action
within a reasonable time after notice of commencement of the action, or
(iii) such indemnified party or parties shall have reasonably concluded
that there may be defenses available to it or them which are different
from or additional to those available to one or all of the indemnifying
parties (in which case the indemnifying party or parties shall not have
the right to direct the defense of such action on behalf of the
indemnified party or parties), in any of which events such fees and
expenses of counsel shall be borne by the indemnifying parties;
provided, however, that the indemnifying party under subsection (a) or
(b) above shall only be liable for the legal expenses of one counsel
(in addition to any local counsel) for all indemnified parties in each
jurisdiction in which any claim or action is brought. Anything in this
subsection to the contrary notwithstanding, an indemnifying party shall
not be liable for any settlement of any claim or action effected
without its prior written consent, provided that such consent was not
unreasonably withheld.
7. Contribution. In order to provide for contribution in circumstances
in which the indemnification provided for in Section 6 is for any reason held to
be unavailable from an indemnifying party or is insufficient to hold harmless a
party indemnified thereunder, the Issuer, the Company and the Guarantors, on the
one hand, and the Initial Purchasers, on the other hand, shall contribute to the
aggregate losses, liabilities, claims, damages and expenses of the nature
contemplated by such indemnification provision (including any investigation,
legal and other expenses incurred in connection with, and any amount paid in
settlement of, any action, suit or proceeding or any claims asserted, but after
deducting in the case of losses, liabilities, claims, damages and expenses
suffered by the Issuer, the Company or the Guarantors, any contribution received
by the Issuer, the Company and the Guarantors from persons, other than the
Initial Purchasers, who may also be liable for contribution, including persons
who control the Issuer, the Company or any of the Guarantors within the meaning
of Section 15 of the Act or Section 20(a) of the Exchange Act) to which the
Issuer, the Company, the Guarantors and the Initial Purchasers may be subject,
in such proportion as is appropriate to reflect the relative benefits received
by the Issuer, the Company and the Guarantors, on the one hand, and the Initial
Purchasers, on the other hand, from the offering of the Series A Notes or, if
such allocation is not permitted by applicable law or indemnification is not
available as a result of the indemnifying party not having received notice as
provided in Section 6, in such proportion as is appropriate to reflect not only
the relative benefits referred to above but also the relative fault of the
Issuer, the Company and the Guarantors, on the one hand, and the Initial
Purchasers, on the other hand, in connection with the statements or omissions
which resulted in such losses, liabilities, claims, damages or expenses, as well
as any other relevant equitable considerations. The relative benefits received
by the Issuer, the Company and the Guarantors, on the one hand, and the Initial
Purchasers, on the other hand, shall be deemed to be in the same proportion as
(i) the total proceeds from the offering of Series A Notes (net of discounts but
before deducting expenses) received by the Issuer and the Company and (ii) the
discounts and commissions received by the Initial Purchasers, respectively, in
each case as set forth in the table on the cover page of the Offering
Memorandum. The relative fault of the Issuer, the Company and the Guarantors, on
the one hand, and of the Initial Purchasers, on the other hand, 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 Issuer,
27
the Company, the Guarantors or the Initial Purchasers and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission. The Issuer, the Company, the Guarantors and the
Initial Purchasers agree that it would not be just and equitable if contribution
pursuant to this Section 7 were determined by pro rata allocation (even if the
Initial Purchasers were treated as one entity for such purpose) or by any other
method of allocation which does not take into account the equitable
considerations referred to above. Notwithstanding the provisions of this Section
7, (i) in no case shall the Initial Purchaser be required to contribute any
amount in excess of the amount by which the discounts and commissions applicable
to the Series A Notes purchased by the Initial Purchaser pursuant to this
Agreement exceeds the amount of any damages which the Initial Purchaser has
otherwise been required to pay by reason of any untrue or alleged untrue
statement or omission or alleged omission and (ii) no person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. For purposes of this Section 7, (A) each person,
if any, who controls any Initial Purchaser within the meaning of Section 15 of
the Act or Section 20(a) of the Exchange Act and (B) the respective officers,
directors, partners, employees, representatives and agents of any Initial
Purchaser or any controlling person shall have the same rights to contribution
as such Initial Purchaser, and (A) each person, if any, who controls the Issuer,
the Company or any Guarantor within the meaning of Section 15 of the Act or
Section 20(a) of the Exchange Act and (B) the respective officers, directors,
partners, employees, representatives and agents of the Issuer, the Company and
the Guarantors shall have the same rights to contribution as the Issuer and the
Company, subject in each case to clauses (i) and (ii) of this Section 7. Any
party entitled to contribution will, promptly after receipt of notice of
commencement of any action, suit or proceeding against such party in respect of
which a claim for contribution may be made against another party or parties
under this Section 7, notify such party or parties from whom contribution may be
sought, but the failure to so notify such party or parties shall not relieve the
party or parties from whom contribution may be sought from any obligation it or
they may have under this Section 7 or otherwise. No party shall be liable for
contribution with respect to any action or claim settled without its prior
written consent, provided that such written consent was not unreasonably
withheld. The Initial Purchasers' obligations to contribute pursuant to this
Section 7 are several in proportion to the respective principal amount of Series
A Notes purchased by each of the Initial Purchasers hereunder and not joint.
8. Conditions of Initial Purchasers' Obligations. The obligations of
the Initial Purchasers to purchase and pay for the Series A Notes, as provided
herein, shall be subject to the satisfaction of the following conditions:
(a) All of the representations and warranties of the Issuer,
the Company and the Guarantors contained in this Agreement shall be
true and correct on the date hereof and on the Closing Date with the
same force and effect as if made on and as of the date hereof and the
Closing Date, respectively. The Issuer, the Company and the Guarantors
shall have performed or complied with all of the agreements herein
contained and required to be performed or complied with by it at or
prior to the Closing Date.
(b) The Offering Memorandum shall have been printed and copies
distributed to the Initial Purchasers not later than 10:00 a.m., New
York City time, on the day following the date of this Agreement or at
such later date and time as to which the Initial
28
Purchasers may agree, and no stop order suspending the qualification or
exemption from qualification of the Series A Notes in any jurisdiction
referred to in Section 4(e) shall have been issued and no proceeding
for that purpose shall have been commenced or shall be pending or
threatened.
(c) No action shall have been taken and no statute, rule,
regulation or order shall have been enacted, adopted or issued by any
governmental agency which would, as of the Closing Date, prevent the
issuance of the Series A Notes or the Guarantees thereof; no action,
suit or proceeding shall have been commenced and be pending against or
affecting or, to the best knowledge of the Issuer, the Company and the
Guarantors, threatened against, the Issuer, the Company or any of the
Company's subsidiaries before any court or arbitrator or any
governmental body, agency or official that, if adversely determined,
could reasonably be expected to result in a Material Adverse Effect;
and no stop order shall have been issued preventing the use of the
Offering Memorandum, or any amendment or supplement thereto, or which
could reasonably be expected to have a Material Adverse Effect.
(d) Since the dates as of which information is given in the
Offering Memorandum, except as contemplated in connection with the
Reorganization, (i) there shall not have been any material adverse
change, or any development that is reasonably likely to result in a
material adverse change, in the capital stock or the long-term debt, or
material increase in the short-term debt, of the Issuer, the Company or
any of the Company's subsidiaries from that set forth in the Offering
Memorandum, (ii) no dividend or distribution of any kind shall have
been declared, paid or made by the Issuer, the Company or any of the
Company's subsidiaries on any class of its capital stock and (iii) none
of the Issuer, the Company or any of the Company's subsidiaries shall
have incurred any liabilities or obligations, direct or contingent,
that are material, individually or in the aggregate, to the Issuer, the
Company and the Company's subsidiaries, taken as a whole, and that are
required to be disclosed on a balance sheet or notes thereto in
accordance with generally accepted accounting principles and are not
disclosed on the latest balance sheet or notes thereto included in the
Offering Memorandum. Since the date hereof and since the dates as of
which information is given in the Offering Memorandum, there shall not
have occurred any material adverse change, or any development that is
reasonably likely to result in a material adverse change, in the
business, prospects, condition (financial or otherwise) or results of
operations of the Issuer, the Company and its subsidiaries, taken as a
whole.
(e) The Initial Purchasers shall have received certificates,
dated the Closing Date, signed on behalf of the Issuer, the Company and
each Guarantor, in form and substance satisfactory to the Initial
Purchasers, confirming, as of the Closing Date, the matters set forth
in paragraphs (a), (b), (c) and (d) of this Section 8 and that, as of
the Closing Date, the obligations of the Issuer, the Company and the
Guarantors to be performed hereunder on or prior thereto have been duly
performed.
(f) The Initial Purchasers shall have received certificates,
dated the Closing Date, signed on behalf of the Parent, in form and
substance satisfactory to the Initial
29
Purchasers, as contemplated by the letter agreement (the "DOBSON LETTER
AGREEMENT"), dated as of the date hereof, by and among the Parent and
the Initial Purchasers.
(g) The Initial Purchasers shall have received on the Closing
Date an opinion, dated the Closing Date, in form and substance
satisfactory to the Initial Purchasers and counsel for the Initial
Purchasers, of McAfee & Taft A Professional Corporation, counsel for
the Issuer and the Company, to the effect set forth in Exhibit C
hereto.
(h) The Initial Purchasers shall have received on the Closing
Date an opinion, dated the Closing Date, in form and substance
satisfactory to the Initial Purchasers and counsel for the Initial
Purchasers, of Wilkinson Barker & Knauer, special FCC counsel for the
Issuer and the Company, to the effect set forth in Exhibit D hereto.
(i) At the time this Agreement is executed and at the Closing
Date, the Initial Purchasers shall have received from KPMG LLP,
independent public accountants, dated as of the date of this Agreement
and as of the Closing Date, customary comfort letters addressed to the
Initial Purchasers and in form and substance satisfactory to the
Initial Purchasers and counsel for the Initial Purchasers with respect
to the financial statements and certain financial information of the
Company and its subsidiaries contained in the Offering Memorandum.
(j) At the time this Agreement is executed and at the Closing
Date, the Initial Purchasers shall have received from Ernst & Young
LLP, independent public accountants, dated as of the date of this
Agreement and as of the Closing Date, customary comfort letters
addressed to the Initial Purchasers and in form and substance
satisfactory to the Initial Purchasers and counsel for the Initial
Purchasers with respect to certain financial statements and financial
information contained in the Offering Memorandum.
(k) The Initial Purchasers shall have received an opinion,
dated the Closing Date, in form and substance reasonably satisfactory
to the Initial Purchasers, of Latham & Watkins LLP, counsel for the
Initial Purchasers, covering such matters as are customarily covered in
such opinions.
(l) Latham & Watkins LLP shall have been furnished with such
documents, in addition to those set forth above, as they may reasonably
require for the purpose of enabling them to review or pass upon the
matters referred to in this Section 8 and in order to evidence the
accuracy, completeness or satisfaction in all material respects of any
of the representations, warranties or conditions herein contained.
(m) Prior to the Closing Date, the Issuer, the Company and the
Guarantors shall have furnished to the Initial Purchasers such further
information, certificates and documents as the Initial Purchasers may
reasonably request.
(n) The Issuer and the Trustee shall have entered into the
Indenture and the Initial Purchasers shall have received counterparts,
conformed as executed, thereof.
30
(o) The Issuer, the Company, the Guarantors and the Initial
Purchasers shall have entered into the Registration Rights Agreement
and the Initial Purchasers shall have received counterparts, conformed
as executed, thereof.
(p) The Issuer and the Escrow Agent, shall have entered into
the Escrow Agreement and the Initial Purchasers shall have received
counterparts conformed as executed, thereof.
(q) On or after the date hereof, (i) there shall not have
occurred any downgrading, suspension or withdrawal of, nor shall any
notice have been given of any potential or intended downgrading,
suspension or withdrawal of, or of any review (or of any potential or
intended review) for a possible change that does not indicate the
direction of the possible change in, any rating of the Company or any
Guarantor or any securities of the Company or any Guarantor (including,
without limitation, the placing of any of the foregoing ratings on
credit watch with negative or developing implications or under review
with an uncertain direction) by any "nationally recognized statistical
rating organization" as such term is defined for purposes of Rule
436(g)(2) under the Act, (ii) there shall not have occurred any
negative change, nor shall any notice have been given of any potential
or intended negative change, in the outlook for any rating of the
Company or any Guarantor or any securities of the Company or any
Guarantor by any such rating organization and (iii) no such rating
organization shall have given notice that it has assigned (or is
considering assigning) a lower rating to the Notes than that on which
the Notes were marketed.
(r) The Notes shall have been approved by the National
Association of Securities Dealers, Inc. for trading on PORTAL.
(s) The Company shall have released it's results of operations
for the fiscal quarter ended June 30, 2003 and filed such results on a
Form 8-K with the Commission on or prior to August 5, 2003.
(t) All opinions, certificates, letters and other documents
required by this Section 8 to be delivered by the Issuer, the Company
and the Guarantors will be in compliance with the provisions hereof
only if they are reasonably satisfactory in form and substance to the
Initial Purchasers. The Issuer and the Company shall furnish the
Initial Purchasers with such conformed copies of such opinions,
certificates, letters and other documents as they shall reasonably
request.
9. Initial Purchasers' Information. The Issuer and the Company
acknowledge that the statements with respect to the offering of the Series A
Notes set forth (i) in the first and third sentences of the fourth paragraph
under the caption "Plan of Distribution" in the Offering Memorandum and (ii) in
the eighth paragraph under the caption "Plan of Distribution" in the Offering
Memorandum constitute the only information relating to any of the Initial
Purchasers furnished to the Issuer and the Company in writing by or on behalf of
the Initial Purchasers expressly for use in the Offering Memorandum.
31
10. Survival of Representations and Agreements. All representations and
warranties, covenants and agreements of the Initial Purchasers, the Issuer, the
Company and the Guarantors contained in this Agreement, including the agreements
contained in Sections 4(f) and 11(d), the indemnity agreements contained in
Section 6 and the contribution agreements contained in Section 7, shall remain
operative and in full force and effect regardless of any investigation made by
or on behalf of an Initial Purchaser, any controlling person thereof, or by or
on behalf of the Issuer, the Company, the Guarantors or any controlling person
thereof, and shall survive delivery of and payment for the Series A Notes to and
by the Initial Purchasers. The representations contained in Section 5 and the
agreements contained in Sections 4(f), 6, 7 and 11(d) shall survive the
termination of this Agreement, including any termination pursuant to Section 11.
11. Effective Date of Agreement; Termination.
(a) This Agreement shall become effective upon execution and
delivery of a counterpart hereof by each of the parties hereto.
(b) The Initial Purchasers shall have the right to terminate
this Agreement at any time prior to the Closing Date by notice to the
Issuer and the Company from the Initial Purchasers, without liability
(other than with respect to Sections 6 and 7) on the Initial
Purchasers' part to the Issuer, the Company or any of the Guarantors
if, on or prior to such date, (i) the Issuer, the Company or any of the
Guarantors shall have failed, refused or been unable to perform in any
material respect any agreement on its part to be performed hereunder,
(ii) any other condition to the obligations of the Initial Purchasers
hereunder as provided in Section 8 is not fulfilled when and as
required in any material respect, (iii) in the reasonable judgment of
the Initial Purchasers, any material adverse change shall have occurred
since the respective dates as of which information is given in the
Offering Memorandum in the condition (financial or otherwise),
business, properties, assets, liabilities, prospects, net worth,
results of operations or cash flows of the Issuer, the Company and the
Company's subsidiaries, taken as a whole, other than as set forth in
the Offering Memorandum, or (iv)(A) any domestic or international event
or act or occurrence has materially disrupted or, in the opinion of the
Initial Purchasers, will in the immediate future materially disrupt,
the market for the Issuer's or the Company's securities or for
securities in general; or (B) trading in securities generally or
trading in any of the Parent's securities on the New York Stock
Exchange, the American Stock Exchange, the Chicago Board of Options
Exchange, the Chicago Mercantile Exchange, the Chicago Board of Trade
or the Nasdaq Small Cap or National Market shall have been suspended or
materially limited, or minimum or maximum prices for trading shall have
been established, or maximum ranges for prices for securities shall
have been required, on such exchange or the Nasdaq Small Cap or
National Market, or by such exchange or other regulatory body or
governmental authority having jurisdiction; or (C) a banking moratorium
shall have been declared by federal or state authorities, or a
moratorium in foreign exchange trading by major international banks or
persons shall have been declared; or (D) there has occurred any
outbreak or escalation of hostilities or act of terrorism involving the
United States or Canada, or there is a declaration of a national
emergency or war by the United States or Canada such that the effect of
any such event in the sole judgment of the majority in interest of the
Initial Purchasers makes it impossible or inadvisable to proceed with
the offering, sale or delivery of the Series A
32
Notes on the terms and in the manner contemplated in the Offering
Memorandum; or (E) there shall have been such a material adverse change
in general economic, political or financial conditions or if the effect
of international conditions on the financial markets in the United
States shall be such as, in the Initial Purchasers' judgment, makes it
inadvisable or impracticable to proceed with the delivery of the Series
A Notes as contemplated hereby.
(c) Any notice of termination pursuant to this Section 11
shall be by telephone or facsimile and, in either case, confirmed in
writing by letter.
(d) If this Agreement shall be terminated pursuant to any of
the provisions hereof (otherwise than pursuant to clause (iv) of
Section 11(b), in which case each party will be responsible for its own
expenses), or if the sale of the Series A Notes provided for herein is
not consummated because any condition to the obligations of the Initial
Purchasers set forth herein is not satisfied or because of any refusal,
inability or failure on the part of the Issuer, the Company or any of
the Guarantors to perform any agreement herein or comply with any
provision hereof, the Issuer, the Company and the Guarantors shall
reimburse the Initial Purchasers for all out-of-pocket expenses
(including the reasonable fees and expenses of the Initial Purchasers'
counsel), incurred by the Initial Purchasers in connection herewith.
(e) If on the Closing Date any one or more of the Initial
Purchasers shall fail or refuse to purchase the Series A Notes which it
or they have agreed to purchase hereunder on such date and the
aggregate principal amount of the Series A Notes which such defaulting
Initial Purchaser or Initial Purchasers, as the case may be, agreed but
failed or refused to purchase is not more than one-tenth of the
aggregate principal amount of the Series A Notes to be purchased on
such date by all Initial Purchasers, each non-defaulting Initial
Purchaser shall be obligated severally, in the proportion which the
principal amount of the Series A Notes set forth opposite its name in
Exhibit A bears to the aggregate principal amount of the Series A Notes
which all the non-defaulting Initial Purchasers, as the case may be,
have agreed to purchase, or in such other proportion as Bear Stearns
may specify, to purchase the Series A Notes which such defaulting
Initial Purchaser or Initial Purchasers, as the case may be, agreed but
failed or refused to purchase on such date; provided that in no event
shall the aggregate principal amount of the Series A Notes which any
Initial Purchaser has agreed to purchase pursuant to Section 3 hereof
be increased pursuant to this Section 11 by an amount in excess of
one-tenth of such principal amount of the Series A Notes 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 the Series A Notes and the aggregate principal amount of the
Series A Notes with respect to which such default occurs is more than
one-tenth of the aggregate principal amount of the Series A Notes to be
purchased by all Initial Purchasers and arrangements satisfactory to
the Initial Purchasers and the Issuer for purchase of such the Series A
Notes are not made within 48 hours after such default, this Agreement
will terminate without liability on the part of any non-defaulting
Initial Purchaser, the Issuer and the Company. In any such case which
does not result in termination of this Agreement, either Bear Stearns
or the Issuer 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
33
any, in the Offering Memorandum or 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 any such Initial Purchaser under this Agreement.
12. Notice. All communications hereunder, except as may be otherwise
specifically provided herein, shall be in writing and, if sent to the Initial
Purchasers shall be mailed, delivered, telecopied and confirmed in writing or
sent by a nationally recognized overnight courier service guaranteeing delivery
on the next business day to Bear, Stearns & Co. Inc., 383 Madison Avenue, New
York, New York 10179, Attention: Corporate Finance Department, telecopy number:
(212) 272-3092, with a copy to Latham & Watkins LLP, 885 Third Avenue, Suite
1000, New York, New York 10022, Attention: Robert A. Zuccaro, telecopy number:
(212) 751-4864; and if sent to the Issuer, the Company and the Guarantors, shall
be mailed, delivered, telecopied and confirmed in writing or sent by a
nationally recognized overnight courier service guaranteeing delivery on the
next business day to American Cellular Corporation, 14201 Wireless Way, Oklahoma
City, OK 73134, Attention: Chief Financial Officer, telecopy number: (405)
529-8515, with a copy to McAfee & Taft, 211 North Robinson, Suite 1000, Oklahoma
City, OK 73102, Attention: Theodore M. Elam, telecopy number: (405) 235-0439.
13. Parties. This Agreement shall inure solely to the benefit of, and
shall be binding upon, the Initial Purchasers, the Issuer, the Company, the
Guarantors and the controlling persons and agents referred to in Sections 6 and
7, and their respective successors and assigns, and no other person shall have
or be construed to have any legal or equitable right, remedy or claim under or
in respect of or by virtue of this Agreement or any provision herein contained.
The term "successors and assigns" shall not include a purchaser, in its capacity
as such, of Notes from the Initial Purchasers.
14. Construction. This Agreement shall be construed in accordance with
the internal laws of the State of New York. TIME IS OF THE ESSENCE IN THIS
AGREEMENT.
15. Captions. The captions included in this Agreement are included
solely for convenience of reference and are not to be considered a part of this
Agreement.
16. Counterparts. This Agreement may be executed in various
counterparts which together shall constitute one and the same instrument.
[Signature pages to follow]
34
If the foregoing correctly sets forth the understanding among the
Initial Purchasers, the Issuer, the Company and the Guarantors please so
indicate in the space provided below for that purpose, whereupon this letter
shall constitute a binding agreement among us.
Very truly yours,
ACC ESCROW CORP.
By: /s/ BRUCE R. KNOOIHUIZEN
-----------------------------------
Name: Bruce R. Knooihuizen
Title: Vice President and Treasurer
AMERICAN CELLULAR CORPORATION
By: /s/ BRUCE R. KNOOIHUIZEN
-----------------------------------
Name: Bruce R. Knooihuizen
Title: Vice President and Treasurer
ACC LEASE CO., INC.
By: /s/ BRUCE R. KNOOIHUIZEN
-----------------------------------
Name: Bruce R. Knooihuizen
Title: Vice President and Treasurer
AMERICAN CELLULAR WIRELESS LLC
By: /s/ BRUCE R. KNOOIHUIZEN
-----------------------------------
Name: Bruce R. Knooihuizen
Title: Vice President and Treasurer
ALEXANDRIA CELLULAR CORPORATION
By: /s/ BRUCE R. KNOOIHUIZEN
-----------------------------------
Name: Bruce R. Knooihuizen
Title: Vice President and Treasurer
35
ACC OF WEST VIRGINIA CORPORATION
By: /s/ BRUCE R. KNOOIHUIZEN
-----------------------------------
Name: Bruce R. Knooihuizen
Title: Vice President and Treasurer
ACC OF PENNSYLVANIA LLC
By: /s/ BRUCE R. KNOOIHUIZEN
-----------------------------------
Name: Bruce R. Knooihuizen
Title: Vice President and Treasurer
ACC OF MICHIGAN CORPORATION
By: /s/ BRUCE R. KNOOIHUIZEN
-----------------------------------
Name: Bruce R. Knooihuizen
Title: Vice President and Treasurer
ACC OF MINNESOTA CORPORATION
By: /s/ BRUCE R. KNOOIHUIZEN
-----------------------------------
Name: Bruce R. Knooihuizen
Title: Vice President and Treasurer
ACC OF OHIO CORPORATION
By: /s/ BRUCE R. KNOOIHUIZEN
-----------------------------------
Name: Bruce R. Knooihuizen
Title: Vice President and Treasurer
ACC OF WISCONSIN LLC
By: /s/ BRUCE R. KNOOIHUIZEN
-----------------------------------
Name: Bruce R. Knooihuizen
Title: Vice President and Treasurer
36
ACC OF KENTUCKY LLC
By: /s/ BRUCE R. KNOOIHUIZEN
------------------------------
Name: Bruce R. Knooihuizen
Title: Vice President and Treasurer
37
Accepted and agreed to as of
the date first above written:
BEAR, STEARNS & CO. INC.
By: /s/ LAWRENCE B. ALLETTO
--------------------------------
Name: Lawrence B. Alletto
Title: Senior Managing Director
MORGAN STANLEY & CO. INCORPORATED
By: /s/ CONSTANTINE N. DARRAS
--------------------------------
Name: Constantine N. Darras
Title: Vice President
38
Exhibit A
<Table>
<Caption>
Principal Amount
Initial Purchaser of Notes
----------------- ----------------
Bear, Stearns & Co. Inc............................................ $600,000,000
Morgan Stanley & Co. Incorporated.................................. $300,000,000
Total..................................................... $900,000,000
</Table>
Exhibit B
Subsidiaries of the Company
ACC Lease Co., Inc.
PCPCS Corporation
American Cellular Wireless LLC
Alexandra Cellular Corporation
Chill Cellular Corporation
ACC of West Virginia Corporation
ACC of Pennsylvania LLC
ACC of Tennessee LLC
ACC of Minnesota Corporation
ACC of Michigan Corporation
Dutchess County Cellular TelCo, Inc.
ACC of Ohio Corporation
ACC of Wisconsin LLC
ACC of Kentucky LLC
Alton CellTelCo Cellular Corporation
Alton CellTel Co
ACC of Wausau Corporation
Exhibit C
Form of Opinion of McAfee & Taft
1. Each of the Issuer, the Parent, the Company and the Guarantors (a)
is duly organized and is validly existing as a corporation in good standing
under the laws of its jurisdiction of incorporation, (b) has all requisite
corporate power and authority to carry on its business as it is currently being
conducted and as described in the Offering Memorandum and to own, lease and
operate its properties, and (c) to the best of such counsel's knowledge, is duly
qualified and in good standing as a foreign corporation, authorized to do
business in each jurisdiction listed on Schedule A to such opinion (which
schedule shall be in a form satisfactory the Initial Purchasers).
2. Each of the Issuer, the Parent, the Company and the Guarantors has
all requisite corporate power and authority to execute, deliver and perform its
obligations under each of the Operative Documents to which it is a party and to
consummate the transactions contemplated hereby and thereby, including, without
limitation, the corporate power and authority to issue, sell and deliver the
Notes as provided herein.
3. All of the outstanding capital stock of each subsidiary of the
Company is owned by the Company, free and clear of any security interest, claim,
lien, limitation on voting rights or encumbrance; and all such securities have
been duly authorized, validly issued, and are fully paid and nonassessable and
were not issued in violation of any preemptive or similar rights.
4. The Parent Common Stock and the Parent Preferred Stock have been or
will be reserved for issuance prior to consummation of the Reorganization and
when so issued and delivered in connection with the Reorganization, will be duly
and validly issued, fully-paid and non-assessable.
5. The shares of the Parent's Class A Common Stock, par value $.001
issuable upon conversion of the Parent Preferred Stock (the "CONVERSION SHARES")
have been duly authorized by all necessary corporate action on the part of the
Parent and such Conversion Shares have been or will be reserved for issuance
prior to the consummation of the Reorganization. The Conversion Shares when
issued and delivered in accordance with the provisions of the certificate of
designations governing the Parent Preferred Stock, will be duly and validly
issued, fully-paid and non-assessable
6. The payment of the Cash Consideration has been duly authorized by
all necessary corporate action on the part of the Parent and the Parent has
reserved $50,000,000 for the payment thereof.
7. This Agreement has been duly and validly authorized, executed and
delivered by the Issuer, the Parent, the Company and each of the Guarantors.
8. The Registration Rights Agreement has been duly and validly
authorized, executed and delivered by the Issuer, the Company and each of the
Guarantors and, assuming that the Registration Rights Agreement is the valid and
legally binding obligation of the Initial Purchasers, constitutes a valid and
binding agreement of the Issuer, the Company and each of the
i
Guarantors, enforceable against each of them in accordance with its terms,
except to the extent that (a) enforcement thereof may be limited by (i)
bankruptcy, insolvency, reorganization, moratorium or other similar laws now or
hereafter in effect relating to creditors' rights generally and (ii) general
principles of equity (regardless of whether enforceability is considered in a
proceeding at law or in equity); and (b) the enforceability of indemnification
and contribution provisions may be limited by Federal and state securities laws
and the policies underlying such laws. The Offering Memorandum contains a
summary description of the terms of the Registration Rights Agreement, which
fairly presents and summarizes in all material respects the terms of the
Registration Rights Agreement.
9. The Indenture has been duly and validly authorized, executed and
delivered by the Issuer and, assuming the Indenture is a valid and legally
binding obligation of the Trustee, constitutes a valid and binding agreement of
the Issuer, enforceable against it in accordance with its terms, except to the
extent that enforcement thereof may be limited by (i) bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in effect
relating to creditors' rights generally and (ii) general principles of equity
(regardless of whether enforceability is considered in a proceeding at law or in
equity), and except as rights to indemnification and contribution may be limited
by federal or state securities laws or principles of public policy. The Offering
Memorandum contains a summary description of the terms of the Indenture, which
fairly presents and summarizes in all material respects the terms of the Series
A Indenture.
10. The Escrow Agreement has been duly and validly authorized, executed
and delivered by the Issuer and, assuming the Escrow Agreement is a valid and
legally binding obligation of the Escrow Agent, constitutes a valid and binding
agreement of the Issuer, enforceable against it in accordance with its terms,
except to the extent that enforcement thereof may be limited by (i) bankruptcy,
insolvency, reorganization, moratorium or other similar laws now or hereafter in
effect relating to creditors' rights generally and (ii) general principles of
equity (regardless of whether enforceability is considered in a proceeding at
law or in equity), and except as rights to indemnification and contribution may
be limited by federal or state securities laws or principles of public policy.
The Offering Memorandum contains a summary description of the terms of the
Escrow Agreement, which fairly presents and summarizes in all material respects
the terms of the Escrow Agreement.
11. The Support Agreement has been duly and validly authorized,
executed and delivered by each of Parent and the Company and, assuming the
Support Agreement is a valid and legally binding obligation of the other parties
thereto, constitutes a valid and binding agreement of each of the Parent and the
Company, enforceable against them in accordance with its terms, except to the
extent that enforcement thereof may be limited by (i) bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in effect
relating to creditors' rights generally and (ii) general principles of equity
(regardless of whether enforceability is considered in a proceeding at law or in
equity).
12. The Merger Agreement has been duly and validly authorized, executed
and delivered by each of the Issuer and the Company and, assuming the Merger
Agreement is a valid and legally binding obligation of each of the Issuer and
the Company, constitutes a valid and binding agreement of the Issuer and the
Company, enforceable against them in accordance with its terms, except to the
extent that enforcement thereof may be limited by (i) bankruptcy,
ii
insolvency, reorganization, moratorium or other similar laws now or hereafter in
effect relating to creditors' rights generally and (ii) general principles of
equity (regardless of whether enforceability is considered in a proceeding at
law or in equity), and except as rights to indemnification and contribution may
be limited by federal or state securities laws or principles of public policy.
13. The Dobson Letter Agreement has been duly and validly authorized,
executed and delivered by the Parent and, assuming the Dobson Letter Agreement
is a valid and legally binding obligation of the other parties thereto,
constitutes a valid and binding agreement of the Parent, enforceable against the
Parent in accordance with its terms, except to the extent that enforcement
thereof may be limited by (i) bankruptcy, insolvency, reorganization, moratorium
or other similar laws now or hereafter in effect relating to creditors' rights
generally and (ii) general principles of equity (regardless of whether
enforceability is considered in a proceeding at law or in equity).
14. The ACC Letter Agreement has been duly and validly authorized,
executed and delivered by each of the Issuer and the Company and, assuming the
ACC Letter Agreement is a valid and legally binding obligation of the other
parties thereto, constitutes a valid and binding agreement of each of the Issuer
and the Company, enforceable against them in accordance with its terms, except
to the extent that enforcement thereof may be limited by (i) bankruptcy,
insolvency, reorganization, moratorium or other similar laws now or hereafter in
effect relating to creditors' rights generally and (ii) general principles of
equity (regardless of whether enforceability is considered in a proceeding at
law or in equity).
15. Upon consummation of the Merger, the Indenture will constitute a
valid and binding agreement of the Company and each of the Guarantors,
enforceable against each of them in accordance with its terms, except to the
extent that enforcement thereof may be limited by (i) bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in effect
relating to creditors' rights generally and (ii) general principles of equity
(regardless of whether enforceability is considered in a proceeding at law or in
equity), and except as rights to indemnification and contribution may be limited
by federal or state securities laws or principles of public policy.
16. The Series A Notes have been duly and validly authorized and
executed by the Issuer for issuance and sale to the Initial Purchasers pursuant
to this Agreement, and, when authenticated in accordance with the terms of the
Indenture and delivered against payment therefor in accordance with the terms
hereof and thereof, the Series A Notes will be the valid and legally binding
obligations of the Issuer, enforceable against it in accordance with their terms
and entitled to the benefits of the Indenture, except to the extent that
enforcement thereof may be limited by (i) bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in effect
relating to creditors' rights generally and (ii) general principles of equity
(regardless of whether enforceability is considered in a proceeding at law or in
equity), and except as rights to indemnification and contribution may be limited
by federal or state securities laws or principles of public policy. The Offering
Memorandum contains a summary description of the terms of the Series A Notes,
which fairly presents and summarizes in all material respects the terms of the
Series A Notes.
iii
17. The Guarantees of the Series A Notes have been duly and validly
authorized by each of the Guarantors and, when executed and delivered in
accordance with the terms of the Indenture and when the Series A Notes have been
issued and authenticated in accordance with the terms of the Indenture and
delivered against payment therefor in accordance with the terms hereof and
thereof, will be the valid and legally binding obligations of each of the
Guarantors, enforceable against each of them in accordance with their terms and
entitled to the benefits of the Indenture, except to the extent that enforcement
thereof may be limited by (i) bankruptcy, insolvency, reorganization, moratorium
or other similar laws now or hereafter in effect relating to creditors' rights
generally and (ii) general principles of equity (regardless of whether
enforceability is considered in a proceeding at law or in equity), and except as
rights to indemnification and contribution may be limited by federal or state
securities laws or principles of public policy. The Offering Memorandum contains
a summary description of the terms of the Guarantees of the Series A Notes,
which fairly presents and summarizes in all material respects the terms of the
Guarantees of the Series A Notes.
18. The Exchange Notes have been duly and validly authorized for
issuance by the Company, and, when issued and authenticated in accordance with
the terms of the Exchange Offer and the Indenture, the Exchange Notes will be
the valid and legally binding obligations of the Company, enforceable against it
in accordance with their terms and entitled to the benefits of the Indenture,
except to the extent that enforcement thereof may be limited by (i) bankruptcy,
insolvency, reorganization, moratorium or other similar laws now or hereafter in
effect relating to creditors' rights generally and (ii) general principles of
equity (regardless of whether enforceability is considered in a proceeding at
law or in equity), and except as rights to indemnification and contribution may
be limited by federal or state securities laws or principles of public policy.
19. The Guarantees of the Exchange Notes have been duly and validly
authorized by each of the Guarantors and, when executed and delivered in
accordance with the terms of the Indenture and when the Exchange Notes have been
issued and authenticated in accordance with the terms of the Exchange Offer and
the Indenture, will be the valid and legally binding obligations of each of the
Guarantors, enforceable against each of them in accordance with their terms and
entitled to the benefits of the Indenture, except to the extent that enforcement
thereof may be limited by (i) bankruptcy, insolvency, reorganization, moratorium
or other similar laws now or hereafter in effect relating to creditors' rights
generally and (ii) general principles of equity (regardless of whether
enforceability is considered in a proceeding at law or in equity), and except as
rights to indemnification and contribution may be limited by federal or state
securities laws or principles of public policy.
20. The statements under the captions "Summary-American Cellular
Corporation," "Summary-The Reorganization," "The Reorganization," "Terms of the
Escrow," "Description of Notes," "Notice to Investors," "Business-Roaming,"
"Related Party Transactions" and "Certain Material United States Federal Tax
Consequences" in the Offering Memorandum, insofar as such statements constitute
a summary of the legal matters, documents or proceedings referred to therein,
present fairly in all material respects, such legal matters, documents and
proceedings.
21. None of (a) the execution, delivery or performance by the Issuer,
the Parent, the Company or any of the Guarantors of this Agreement, the Dobson
Letter Agreement or any of the other Operative Documents to which they are a
party, (b) the issuance and sale of the Series
iv
A Notes and, upon the consummation of the Reorganization, the issuance of the
Guarantees and (c) consummation by the Issuer, the Parent, the Company or any of
the Guarantors of the transactions described in the Offering Memorandum under
the captions "The Reorganization," "Related Party Transactions" or "Use of
Proceeds," violates, conflicts with or constitutes a breach of any of the terms
of provisions, or after giving effect to the Reorganization will violate,
conflict with or constitute a breach of, any of the terms or provisions of, or a
default under (or an event that with notice or the lapse of time, or both, would
constitute a default under including after giving effect to the Reorganization),
or requires consent under (including after giving effect to the Reorganization),
or results (including after giving effect to the Reorganization) in the
imposition of a lien or encumbrance on any properties of the Issuer, the Parent,
the Company or any of the Company's subsidiaries, or an acceleration of any
indebtedness of the Issuer, the Parent, the Company or any of the Company's
subsidiaries pursuant to, (i) the charter or bylaws of the Issuer, the Parent,
the Company or any of the Company's subsidiaries, (ii) any bond, debenture,
note, indenture, mortgage, deed of trust or other agreement or instrument to
which the Issuer, the Parent, the Company or any of the Company's subsidiaries
is a party or by which any of them or their property is or may be bound, (iii)
any statute, rule or regulation applicable to the Issuer, the Parent, the
Company or any the Company's subsidiaries or any of their assets or properties
or (iv) to the best of such counsel's knowledge, any judgment, order or decree
of any court or governmental agency or authority having jurisdiction over the
Issuer, the Parent, the Company or any of the Company's subsidiaries or any of
their assets or properties, except in the cases of clauses (ii), (iii) and (iv)
for such violations, conflicts, breaches or defaults that, individually or in
the aggregate, could not reasonably be expected to have a Material Adverse
Effect. Assuming compliance with applicable state securities and Blue Sky laws,
the Communications Act, the rules and regulations of the FCC and the applicable
state public utility laws, rules and regulations, as to which such counsel need
express no opinion, and except for the filing of a registration statement under
the Act and qualification of the Indenture under the Trust Indenture Act, or
otherwise in connection with the Registration Rights Agreement, no consent,
approval, authorization or order of, or filing, registration, qualification,
license or permit of or with, (a) any court or governmental agency, body or
administrative agency or (b) any other person is required for (i) the execution,
delivery and performance by each of the Issuer, the Parent, the Company and the
Guarantors of this Agreement or any of the other Operative Documents to which
they are a party or (ii) the issuance and sale of the Series A Notes, the
issuance, upon consummation of the Reorganization, of the Guarantees and the
transactions contemplated hereby and thereby, except such as have been obtained
and made or have been disclosed in the Offering Memorandum.
22. There are no legal or governmental actions, suits or proceedings
pending or, to the best of such counsel's knowledge, threatened against or
affecting the Issuer, the Parent, the Company or any of the Guarantors which, if
determined adversely to the Issuer, the Parent, the Company or any of the
Guarantors, could reasonably be expected to result in a Material Adverse Effect,
except to the extent disclosed in the Offering Memorandum.
23. No registration under the Act of the Series A Notes is required for
the sale of the Series A Notes to the Initial Purchasers as contemplated hereby
or for the Exempt Resales assuming (a) that each Initial Purchaser is a QIB, (b)
that the purchasers who buy the Series A Notes in the Exempt Resales are either
QIBs or Reg S Investors, (c) the accuracy of the representations of the Initial
Purchasers, the Issuer and the Company regarding the absence of general
solicitation in connection with the sale of Series A Notes to the Initial
Purchasers and the
v
Exempt Resales contained herein and (d) the accuracy of the Issuer's and the
Company's representations in Sections 5(a)(vii) and (xxxvi) (other than with
respect to the first sentence).
24. Each of the Preliminary Offering Memorandum and the Offering
Memorandum, as of its date, and each amendment or supplement thereto, as of its
date (except for the financial statements and related notes, the financial
statement schedules and other financial data included therein or omitted
therefrom, as to which no opinion need be expressed), contains the information
specified in, and meets the requirements of, Rule 144A(d)(4) under the Act.
25. None of the Issuer, the Parent, the Company or any the Guarantors
is an "investment company" or a company "controlled" by an "investment company"
within the meaning of the Investment Company Act.
26. The Indenture complies as to form in all material respects with the
requirements of the Trust Indenture Act and the rules and regulations of the
Commission applicable to an indenture which is qualified thereunder. Prior to
the Exchange Offer or the effectiveness of the Shelf Registration Statement, the
Indenture is not required to be qualified under the Trust Indenture Act.
27. In addition, such counsel shall state that it has participated in
conferences with officers and other representatives of the Issuer, the Parent,
the Company and the Guarantors, representatives of the independent certified
public accountants of the Issuer, the Parent, the Company and the Guarantors and
the Initial Purchasers and their representatives at which the contents of the
Offering Memorandum and related matters were discussed and, although it is not
passing upon, and does not assume any responsibility for, the accuracy,
completeness or fairness of the statements contained in the Offering Memorandum
and has not made any independent check or verification thereof, during the
course of such participation, no facts have come to its attention which led it
to believe that the Offering Memorandum as of its date or the Closing Date,
contained an untrue statement of a material fact or omitted to state any 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
(except as to financial statements and other financial data included therein or
omitted therefrom).
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Exhibit D
Form of Opinion of Wilkinson Barker Knauer, LLP
a) Subsidiaries of the Company hold all the licenses, permits and
authorizations required to be issued by the Federal Communications
Commission ("FCC") or by any state public utility commission asserting
jurisdiction over the Company or any subsidiaries of the Company
("Applicable PUC") (such licenses, permits and authorizations referred
to herein as the "Licenses") for the operation of the businesses of the
Company and its subsidiaries as they are, to our knowledge after review
of the section of the Offering Memorandum titled "Business", currently
operating, except where the failure to have any such Licenses would not
reasonably be expected to have a Material Adverse Effect. All the
Licenses are in full force and effect, and there are no pending
modifications, amendments or revocation proceedings with respect to any
of the Licenses that are likely to have a Material Adverse Effect.
b) To our knowledge, the Company and its subsidiaries are in compliance in
all material respects with the terms of the Licenses, as applicable,
and we have no knowledge of any event that has occurred with respect to
the Licenses which, with the giving of notice or the lapse of time or
both, would constitute grounds for revocation of any Licenses. To our
knowledge, there is no condition, event or occurrence existing, nor is
there any proceeding being conducted, of which the Company or any of
its subsidiaries has received notice, nor, to our knowledge, is there
any proceeding threatened, by the FCC or any Applicable PUC, which if
adversely decided, would have a Material Adverse Effect.
c) The Company and its respective subsidiaries are not required to make or
file any registration, filing, application or notice, or to obtain any
consent, approval or waiver, from the FCC or any Applicable PUC by
virtue of the execution, delivery and performance of the Agreement and
the consummation of the Operative Documents.
d) The statements under the caption "Regulation" in the "Business" section
of the Offering Memorandum, insofar as such statements constitute a
summary of the legal matters, documents or proceedings referred to
therein, present fairly in all material respects such legal matters,
documents and proceedings.
i
Schedule A
List of Guarantors
ACC Lease Co., Inc.
American Cellular Wireless LLC
Alexandra Cellular Corporation
ACC of West Virginia Corporation
ACC of Pennsylvania LLC
ACC of Minnesota Corporation
ACC of Michigan Corporation
ACC of Ohio Corporation
ACC of Wisconsin LLC
ACC of Kentucky LLC