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PURCHASE AGREEMENT
QWEST CAPITAL FUNDING, INC.
$1,250,000,000 OF 7.75% NOTES DUE AUGUST 15, 2006
$1,750,000,000 OF 7.90% NOTES DUE AUGUST 15, 2010
UNCONDITIONALLY GUARANTEED AS TO PAYMENT OF
PRINCIPAL, PREMIUM, IF ANY, AND INTEREST BY
QWEST COMMUNICATIONS INTERNATIONAL INC.
August 16, 2000
Salomon Smith Barney Inc.
Lehman Brothers Inc.
As Representatives of the several Initial Purchasers
named in Schedule I hereto
c/o Salomon Smith Barney Inc.
388 Greenwich Street
New York, New York 10013
Ladies and Gentlemen:
Qwest Capital Funding, Inc. (formerly known as U S WEST Capital
Funding, Inc.), a Colorado corporation (the "COMPANY"), proposes to issue and
sell to the several Initial Purchasers listed in Schedule I hereto (the
"INITIAL PURCHASERS") for whom Salomon Smith Barney Inc. and Lehman Brothers
Inc. are acting as representatives (the "REPRESENTATIVES"), $1,250,000,000
principal amount of its 7.75% Notes due August 15, 2006 (the "2006 Notes") and
$1,750,000,000 principal amount of its 7.90% Notes due August 15, 2010 (the
"2010 NOTES", together with the 2006 Notes, the "SECURITIES"). The Securities
will be unconditionally guaranteed as to payment of principal, premium, if
any, and interest (the "GUARANTEES") by Qwest Communications International
Inc. (as successor to U S WEST, Inc. ("U S WEST")), a Delaware corporation
(the "GUARANTOR"), and will be issued pursuant to the provisions of an
Indenture, dated as of June 29, 1998, as amended by the First Supplemental
Indenture, dated as of June 30, 2000 (as so amended, the "INDENTURE"), among
the Company, the Guarantor and Bank One Trust Company, National Association,
as trustee (the "TRUSTEE").
The Securities will have the benefit of a Registration Rights
Agreement, dated as of August 16, 2000 (the "REGISTRATION RIGHTS AGREEMENT"),
among the Company, the Guarantor and the Initial Purchasers, pursuant to which
the Company and the Guarantor have agreed, for the benefit of the Initial
Purchasers and their respective direct and indirect transferees and assigns,
to register the Securities and the Guarantees under the Securities
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Act of 1933, as amended (the "SECURITIES ACT") subject to the terms and
conditions therein specified.
The sale of the Securities to the Initial Purchasers will be made
without registration of the Securities and the Guarantees under the Securities
Act, in reliance upon exemptions therefrom.
In connection with the sale of the Securities, the Company and the
Guarantor have prepared a preliminary offering memorandum dated August 11,
2000 (the "PRELIMINARY OFFERING MEMORANDUM") and an offering memorandum dated
the date hereof (the "OFFERING MEMORANDUM"), for the information of the
Initial Purchasers and for delivery to prospective purchasers of the
Securities. The terms Preliminary Offering Memorandum and Offering Memorandum
shall be deemed to mean and include documents incorporated by reference
therein. All references in this Agreement to financial statements and
schedules and other information which is "contained," "included," "stated" or
"given" in the Offering Memorandum (or other references of like import) shall
be deemed to mean and include all such financial statements and schedules and
other information which is incorporated by reference in the Offering
Memorandum.
The Company, the Guarantor and the Initial Purchasers hereby agree as
follows:
1. The Company agrees to issue and sell the Securities to the several
Initial Purchasers as hereinafter provided, and each Initial Purchaser, upon
the basis of the representations and warranties herein contained, but subject
to the conditions hereinafter stated, agrees to purchase, severally and not
jointly, from the Company the respective principal amount of 2006 Notes set
forth opposite such Initial Purchaser's name in Schedule I hereto at a price
(the "PURCHASE PRICE") equal to 99.278% of their principal amount, and the
principal amount of 2010 Notes set forth opposite such Initial Purchaser's
name in Schedule I hereto at a Purchase Price equal to 99.135% of their
principal amount, plus in each case accrued interest, if any, from August 21,
2000 to the date of payment and delivery.
2. The Company and the Guarantor understand that the Initial Purchasers
intend (i) to offer privately pursuant to Rule 144A under the Securities Act
their respective portions of the Securities as soon after this Agreement has
become effective as in the judgment of the Initial Purchasers is advisable and
(ii) initially to offer the Securities upon the terms set forth in the
Offering Memorandum.
Each of the Company and the Guarantor confirms that it has authorized
the Initial Purchasers, subject to the restrictions set forth below, to
distribute copies of the Offering Memorandum in connection with the offering
of the Securities. Each Initial Purchaser hereby severally makes to the
Company and the Guarantor the following representations and agreements:
(i) it is a "qualified institutional buyer" within the
meaning of Rule 144A under the Securities Act; and
(ii) (A) it will not solicit offers for, or offer to sell,
the Securities by any form of general solicitation or general
advertising (as those terms are used in
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Regulation D under the Securities Act ("REGULATION D")) and (B) it will
solicit offers for the Securities only from, and will offer the
Securities only to, persons who it reasonably believes to be "qualified
institutional buyers" within the meaning of Rule 144A under the
Securities Act that in purchasing the Securities are deemed to have
represented and agreed as provided in the Offering Memorandum.
3. Payment for the Securities shall be made by wire transfer in
immediately available funds to the account specified by the Company to the
Representatives at 9:00 A.M., New York City time, on August 21, 2000, or at
such other time on the same or such other date, not later than the third
Business Day thereafter, as the Representatives and the Company may agree upon
in writing. The time and date of such payment are referred to herein as the
"CLOSING DATE". As used herein, the term "BUSINESS DAY" means any day other
than a day on which banks are permitted or required to be closed in New York
City.
Payment for the Securities shall be made against delivery with
respect to Securities to be resold to "qualified institutional buyers" by the
Initial Purchasers, to the nominee of The Depository Trust Company for the
respective accounts of the several Initial Purchasers of the Securities of one
or more global notes (collectively, the "GLOBAL NOTES") representing such
Securities, with any transfer taxes payable in connection with the transfer to
the Initial Purchasers of the Securities duly paid by the Company. The Global
Notes will be made available for inspection by the Initial Purchasers at the
office of Brown & Wood LLP, One World Trade Center, New York, New York 10048
not later than 1:00 P.M., New York City time, on the Business Day prior to the
Closing Date.
4. The Company and the Guarantor represent and warrant to each Initial
Purchaser that:
(a) The Preliminary Offering Memorandum did not, in the
form used by the Initial Purchasers to market the Securities, and the
Offering Memorandum will not, in the form used by the Initial
Purchasers to confirm sales of the Securities and as of the Closing
Date, contain any untrue statement of a material fact or omit to state
a material fact necessary in order to make the statements therein, in
light of the circumstances existing at such dates, not misleading;
PROVIDED, HOWEVER, that this representation and warranty shall not
apply to any statements or omissions made in reliance upon and in
conformity with written information furnished to the Company or the
Guarantor by any Initial Purchaser, or on behalf of any Initial
Purchaser by the Representatives, specifically for use therein;
(b) the documents incorporated by reference in the
Offering Memorandum (the "INCORPORATED DOCUMENTS"), when they were
filed with the Securities and Exchange Commission (the "COMMISSION"),
conformed in all material respects to the requirements of the
Securities Exchange Act of 1934, as amended (the "EXCHANGE ACT"), and
the rules and regulations of the Commission thereunder, and none of
such documents contained an untrue statement of a material fact or
omitted to state a material fact necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading; and any further documents so filed and incorporated by
reference in the Offering Memorandum, when such documents are filed
with the Commission, will conform
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in all material respects to the requirements of the Exchange Act, and
will not contain an untrue statement of a material fact or omit to
state a material fact necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading;
(c) the financial statements of U S WEST and the
Guarantor, together with the related schedules and notes thereto,
included and incorporated by reference in the Offering Memorandum
present fairly the consolidated financial position of each such entity
and its consolidated subsidiaries as of the dates indicated and the
statement of operations, shareowners' equity and cash flows of each
such entity and its consolidated subsidiaries for the periods
specified; and said financial statements have been prepared in
conformity with generally accepted accounting principles and practices
applied on a consistent basis throughout the periods involved. The pro
forma financial statements of the Guarantor and U S WEST and the
related notes thereto included and incorporated by reference in the
Offering Memorandum, to the best knowledge of the Company and the
Guarantor, present fairly the information shown therein, have been
prepared in accordance with the Commission's rules and guidelines with
respect to the pro forma financial statements and have been properly
compiled on the bases described therein and the assumptions used
therein, and the assumptions used in the preparation thereof are
reasonable and the adjustments used therein are appropriate to give
effect to the transactions and circumstances referred to therein;
(d) since the respective dates as of which information is
given in the Offering Memorandum, except as otherwise stated therein,
(A) there has been no material adverse change in the financial
condition or results of operations of the Company or of the Guarantor
and its subsidiaries, taken as a whole (a "MATERIAL ADVERSE EFFECT"),
(B) there have been no transactions entered into by the Company or by
the Guarantor or any of its subsidiaries, other than those in the
ordinary course of business, which are material with respect to the
Company or the Guarantor and its subsidiaries, taken as a whole, and
(C) there has been no dividend or distribution of any kind declared,
paid or made by the Company or the Guarantor on any class of its
capital stock, except for regular quarterly dividends on the
Guarantor's common stock in amounts that are consistent with past
practice;
(e) this Agreement has been duly authorized, executed and
delivered by each of the Company and the Guarantor;
(f) the Indenture has been duly authorized, executed and
delivered by each of the Company and the Guarantor and (assuming the
due authorization, execution and delivery by the Trustee) constitutes
the legal, valid and binding agreement of the Company and the Guarantor
enforceable against each of them in accordance with its terms, except
as the enforcement thereof may be limited by bankruptcy, insolvency
(including, without limitation, all laws relating to fraudulent
transfers), reorganization, moratorium or similar laws affecting
enforcement of creditors' rights generally and except as enforcement
thereof is
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subject to general principles of equity (regardless of whether
enforcement is considered in a proceeding in equity or at law);
(g) the Registration Rights Agreement has been duly
authorized by the Company and the Guarantor and, when executed and
delivered by the Company and the Guarantor, will constitute a valid and
binding agreement of each of the Company and the Guarantor, enforceable
against the Company and the Guarantor in accordance with its terms,
except as the enforcement thereof may be limited by bankruptcy,
insolvency (including, without limitation, all laws relating to
fraudulent transfers), reorganization, moratorium or similar laws
affecting enforcement of creditors' rights generally and except as
enforcement thereof is subject to general principles of equity
(regardless of whether enforcement is considered in a proceeding in
equity or at law), and except that enforcement of rights to
indemnification and contribution contained therein may be limited by
applicable Federal or state laws or the public policy underlying such
laws;
(h) the Securities have been duly authorized and, at the
Closing Date, will have been duly executed by the Company and, when
authenticated, issued and delivered in the manner provided for in the
Indenture and delivered against payment of the purchase price therefor
as provided in this Agreement, will constitute legal, valid and binding
obligations of the Company, enforceable against the Company in
accordance with their terms, except as the enforcement thereof may be
limited by bankruptcy, insolvency (including, without limitation, all
laws relating to fraudulent transfers), reorganization, moratorium or
similar laws affecting enforcement of creditors' rights generally and
except as enforcement thereof is subject to general principles of
equity (regardless of whether enforcement is considered in a proceeding
in equity or at law), and will be in the form contemplated by, and
entitled to the benefits of, the Indenture;
(i) the Guarantees have been duly authorized and, at the
Closing Date, will have been duly executed by the Guarantor and, when
issued and delivered in the manner provided for in the Indenture, will
constitute legal, valid and binding obligations of the Guarantor,
enforceable against the Guarantor in accordance with their terms,
except as the enforcement thereof may be limited by bankruptcy,
insolvency (including, without limitation, all laws relating to
fraudulent transfers), reorganization, moratorium or similar laws
affecting enforcement of creditors' rights generally and except as
enforcement thereof is subject to general principles of equity
(regardless of whether enforcement is considered in a proceeding in
equity or at law), and will be in the form contemplated by, and
entitled to the benefits of, the Indenture;
(j) the Exchange Notes (as defined in the Registration
Rights Agreement) have been duly authorized and, when authenticated,
issued and delivered in the manner provided for in the Indenture and
issued and delivered in exchange for the Securities in the manner
contemplated in the Registration Rights Agreement, will constitute
valid and binding obligations of the Company, enforceable against the
Company in accordance with their terms, except as the
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enforcement thereof may be limited by bankruptcy, insolvency
(including, without limitation, all laws relating to fraudulent
transfers), reorganization, moratorium or similar laws affecting
enforcement of creditors' rights generally and except as enforcement
thereof is subject to general principles of equity (regardless of
whether enforcement is considered in a proceeding in equity or at
law), and will be in the form contemplated by, and entitled to the
benefits of, the Indenture;
(k) the Exchange Guarantees (as defined in the
Registration Rights Agreement) have been duly authorized and, when
authenticated, issued and delivered in the manner provided for in the
Indenture and issued and delivered in the manner contemplated in the
Registration Rights Agreement, will constitute valid and binding
obligations of the Guarantor, enforceable against the Guarantor in
accordance with their terms, except as the enforcement thereof may be
limited by bankruptcy, insolvency (including, without limitation, all
laws relating to fraudulent transfers), reorganization, moratorium or
similar laws affecting enforcement of creditors' rights generally and
except as enforcement thereof is subject to general principles of
equity (regardless of whether enforcement is considered in a proceeding
in equity or at law);
(l) as of the Closing Date, the Securities, the
Guarantees, the Exchange Notes, the Exchange Guarantees, the Indenture
and the Registration Rights Agreement will conform in all material
respects to the respective statements relating thereto contained in the
Offering Memorandum;
(m) the execution, delivery and performance of this
Agreement and the Registration Rights Agreement and the consummation of
the transactions contemplated herein and therein (including, without
limitation, the issuance and sale of the Securities and the Guarantees)
and compliance by the Company and the Guarantor with their respective
obligations hereunder and thereunder have been duly authorized by all
necessary corporate action and do not and will not, whether with or
without the giving of notice or passage of time or both, conflict with
or constitute a breach of, or default or Repayment Event (as defined
below) under, or result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the Company, the
Guarantor or any subsidiary of the Guarantor pursuant to, any contract,
indenture, mortgage, deed of trust, loan or credit agreement, note,
lease or other agreement or instrument to which the Company, the
Guarantor or any subsidiary of the Guarantor is a party or by which it
or any of them may be bound, or to which any of the property or assets
of the Company, the Guarantor or any subsidiary of the Guarantor is
subject (collectively, "AGREEMENTS AND INSTRUMENTS") (except for such
conflicts, breaches or defaults or liens, charges or encumbrances that
would not result in a Material Adverse Effect), nor will such action
result in any violation of the provisions of the charter or bylaws of
the Company, the Guarantor or any subsidiary of the Guarantor or, to
the best knowledge of the Company and the Guarantor, any applicable
law, statute, rule, regulation, judgment, order, writ or decree of any
government, government instrumentality or court, domestic or foreign,
having jurisdiction over the Company, the Guarantor or any subsidiary
of the Guarantor or any of their assets,
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properties or operations. As used herein, a "REPAYMENT EVENT" means
any event or condition which gives the holder of any note, debenture
or other evidence of indebtedness of the Company, the Guarantor or
any subsidiary of the Guarantor (or any person acting on such
holder's behalf) the right to require the repurchase, redemption or
repayment of all or a portion of such indebtedness by the Company,
the Guarantor or any subsidiary of the Guarantor;
(n) other than as set forth in the Offering Memorandum,
there is not pending or, to the knowledge of the Company or the
Guarantor, threatened any action, suit, proceeding, inquiry or
investigation to which the Company, the Guarantor or any subsidiary of
the Guarantor is a party or to which the assets, properties or
operations of the Company, the Guarantor or any subsidiary of the
Guarantor is subject, before or by any court or governmental agency or
body, domestic or foreign, which might reasonably be expected to result
in a Material Adverse Effect or which might reasonably be expected to
materially and adversely affect the assets, properties or operations of
the Company, the Guarantor and any subsidiary of the Guarantor, taken
as a whole, or the consummation of the transactions contemplated by
this Agreement or the Indenture or the performance by the Company or
the Guarantor of their respective obligations thereunder;
(o) the Guarantor and its subsidiaries possess such
permits, licenses, approvals, consents and other authorizations
(collectively, "GOVERNMENTAL LICENSES") issued by the appropriate
federal, state, local or foreign regulatory agencies or bodies
necessary to conduct the business now operated by them; the Guarantor
and its subsidiaries are in compliance with the terms and conditions of
all such Governmental Licenses, except where the failure so to comply
would not, singly or in the aggregate, have a Material Adverse Effect;
all of the Governmental Licenses are valid and in full force and
effect, except when the invalidity of such Governmental Licenses or the
failure of such Governmental Licenses to be in full force and effect
would not have a Material Adverse Effect; and neither the Guarantor nor
any of its subsidiaries has received any notice of proceedings relating
to the revocation or modification of any such Governmental Licenses
which, singly or in the aggregate, if the subject of an unfavorable
decision, ruling or finding, would result in a Material Adverse Effect;
(p) none of the Company, the Guarantor or any of their
respective affiliates (as defined in Rule 501(b) of Regulation D) has
directly, or through any agent, sold, offered for sale, solicited
offers to buy or otherwise negotiated in respect of, any security (as
defined in the Securities Act) which is or will be integrated with the
sale of the Securities in a manner that would require the registration
under the Securities Act of the offering contemplated by the Offering
Memorandum;
(q) none of the Company, the Guarantor, any affiliate of
the Company or the Guarantor or any person acting on its or their
behalf has offered or sold the Securities by means of any general
solicitation or general advertising within the meaning of Rule 502(c)
under the Securities Act;
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(r) the Securities satisfy the requirements set forth in
Rule 144A(d)(3) under the Securities Act;
(s) assuming the accuracy of the representations of the
Initial Purchasers contained in Section 2 hereof, it is not necessary
in connection with the offer, sale and delivery of the Securities in
the manner contemplated by this Agreement to register the Securities
under the Securities Act or to qualify an indenture under the Trust
Indenture Act of 1939 (the "TRUST INDENTURE ACT"); and
(t) none of the transactions contemplated by this
Agreement (including, without limitation, the use of the proceeds from
the sale of the Securities) will violate or result in a violation of
Section 7 of the Exchange Act, or any regulation promulgated
thereunder, including, without limitation, Regulations T, U, and X of
the Board of Governors of the Federal Reserve System.
5. The Company and the Guarantor covenant and agree with each of the
several Initial Purchasers as follows:
(a) to deliver to the Initial Purchasers as many copies
of the Offering Memorandum (including all amendments and supplements
thereto) as the Initial Purchasers may reasonably request;
(b) before distributing any amendment or supplement to
the Offering Memorandum, to furnish to the Representatives a copy of
the proposed amendment or supplement for review and not to distribute
any such proposed amendment or supplement to which the Representatives
reasonably object;
(c) if, at any time prior to the earlier of (i) 9 months
from the date of the Offering Memorandum and (ii) notice by the
Representatives to the Company and the Guarantor of the completion of
the initial placement of the Securities, any event shall occur as a
result of which the Offering Memorandum as then amended or supplemented
would include an untrue statement of a material fact, or omit to state
any material fact necessary to make the statements therein, in the
light of the circumstances under which they were made, not misleading,
or if it is necessary to amend or supplement the Offering Memorandum to
comply with law, forthwith to prepare and furnish, at the expense of
the Company, to the Initial Purchasers and to the dealers (whose names
and addresses the Representatives will furnish to the Company) to which
Securities may have been sold by the Initial Purchasers on behalf of
the Initial Purchasers and to any other dealers upon request, such
amendments or supplements to the Offering Memorandum as may be
necessary to correct such statement or omission or to effect compliance
with law;
(d) to endeavor to qualify the Securities for offer and
sale under the securities or Blue Sky laws of such jurisdictions as the
Representatives shall reasonably request and to continue such
qualification in effect so long as reasonably required for distribution
of the Securities; PROVIDED that the Company
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shall not be required to file a general consent to service of process
in any jurisdiction;
(e) during the period of two years after the date hereof,
to furnish to the Initial Purchasers, as soon as practicable after the
end of each fiscal year, a copy of the Guarantor's annual report to
shareholders, if any, for such year, and to furnish to the Initial
Purchasers and to counsel to the Initial Purchasers, (i) as soon as
available, a copy of each report of the Guarantor filed with the
Commission under the Exchange Act or mailed to stockholders, and (ii)
from time to time, such other information concerning the Guarantor or
the Company as the Initial Purchasers may reasonably request;
(f) during the period beginning on the date hereof and
continuing to and including the Business Day following the Closing
Date, not to, directly or indirectly, sell, offer to sell, grant any
option for the sale of, or otherwise dispose of, any of its senior debt
securities having a maturity of one year or more without the prior
written consent of the Representatives;
(g) to use the net proceeds received by the Company from
the sale of the Securities pursuant to this Agreement in the manner
specified in the Offering Memorandum under the caption "Use of
Proceeds";
(h) to furnish to the holders of the Securities no later
than 90 days after the end of each fiscal year an annual report
(including a balance sheet and statements of income, stockholders'
equity and cash flows of the Guarantor and its consolidated
subsidiaries certified by independent public accountants) and, as soon
as practicable after the end of each of the first three quarters of
each fiscal year (beginning with the fiscal quarter ending after the
date of the Offering Memorandum), consolidated summary financial
information of the Guarantor and its subsidiaries of such quarter in
reasonable detail;
(i) during the period of two years after the Closing
Date, the Company and the Guarantor will not, and will not permit any
of their respective controlled "affiliates" (as defined in Rule 144
under the Securities Act) to, resell any of the Securities which
constitute "restricted securities" under Rule 144 that have been
reacquired by any of them;
(j) whether or not the transactions contemplated by this
Agreement are consummated or this Agreement is terminated, to pay or
cause to be paid all costs and expenses incident to the performance of
its obligations hereunder and under the Registration Rights Agreement,
including without limiting the generality of the foregoing, all fees,
costs and expenses (i) incident to the preparation, issuance,
execution, authentication and delivery of the Securities, including any
expenses of the Trustee, (ii) incident to the preparation, printing and
distribution of the Offering Memorandum (including all exhibits,
amendments and supplements thereto), (iii) incurred in connection with
the registration or qualification and determination of eligibility for
investment of the Securities under the laws of such jurisdictions as
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the Representatives may designate (including reasonable fees of counsel
for the Initial Purchasers and their disbursements) and the printing of
memoranda relating thereto, (iv) in connection with the approval for
trading of the Securities on any securities exchange or inter-dealer
quotation system (as well as in connection with the designation of the
Securities as PORTAL securities, if so requested), (v) in connection
with the printing (including word processing and duplication costs) and
delivery of this Agreement, the Indenture, any Preliminary and
Supplemental Blue Sky Memoranda and any Legal Investment Survey and the
furnishing to Initial Purchasers and dealers of copies of the Offering
Memorandum, including mailing and shipping, as herein provided, (vi)
payable to rating agencies in connection with the rating of the
Securities, if applicable, and (vii) any expenses incurred by the
Company in connection with a "road show" presentation to potential
investors;
(k) while the Securities remain outstanding and are
"restricted securities" within the meaning of Rule 144(a)(3) and cannot
be sold without restriction under Rule 144(k) under the Securities Act,
the Company and the Guarantor will, during any period in which the
Guarantor is not subject to Section 13 or 15(d) under the Exchange Act
or is not complying with the reporting requirements thereof, make
available to the purchasers and any holder of Securities in connection
with any sale thereof and any prospective purchaser of Securities and
securities analysts, in each case upon request, the information
specified in, and meeting the requirements of, Rule 144A(d)(4) under
the Securities Act (or any successor thereto);
(l) neither the Company nor the Guarantor will take any
action prohibited by Regulation M under the Exchange Act, in connection
with the distribution of the Securities contemplated hereby;
(m) none of the Company, the Guarantor, any of their
respective affiliates (as defined in Rule 501(b) under the Securities
Act) or any person acting on behalf of the Company, the Guarantor or
such affiliate will solicit any offer to buy or offer or sell the
Securities by means of any form of general solicitation or general
advertising, including: (i) any advertisement, article, notice or other
communication published in any newspaper, magazine or similar medium or
broadcast over television or radio; and (ii) any seminar or meeting
whose attendees have been invited by any general solicitation or
general advertising; and
(n) none of the Company, the Guarantor, any of their
respective affiliates (as defined in Regulation 501(b) of Regulation D
under the Securities Act) or any person acting on behalf of the
Company, the Guarantor or such affiliate will sell, offer for sale or
solicit offers to buy or otherwise negotiate in respect of any security
(as defined in the Securities Act) which will be integrated with the
sale of the Securities in a manner which would require the registration
under the Securities Act of the Securities and the Company and the
Guarantor will take all action that is appropriate or necessary to
assure that its offerings of other securities will not be integrated
for purposes of the Securities Act with the offering contemplated
hereby.
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6. The several obligations of the Initial Purchasers hereunder to purchase
the Securities on the Closing Date are subject to the performance by the Company
and the Guarantor of their respective obligations hereunder and to the following
additional conditions:
(a) the representations and warranties of the Company and
the Guarantor contained herein are true and correct on and as of the
Closing Date as if made on and as of the Closing Date, the statements
of the officers of the Company and the Guarantor made pursuant to
Section 6(e) hereof are true and correct and the Company and the
Guarantor shall have complied with all agreements and all conditions on
their part to be performed or satisfied hereunder at or prior to the
Closing Date;
(b) except as previously disclosed to the Initial
Purchasers by in writing the Company or the Guarantor prior to the
execution of this Agreement, on or after the date of this Agreement and
prior to the Closing Date, there shall not have occurred any
downgrading, nor shall any notice have been given of (i) any
downgrading, (ii) any intended or potential downgrading or (iii) any
review or possible change that does not indicate an improvement, in the
rating accorded any debt securities of or guaranteed by the Company or
the Guarantor by any "nationally recognized statistical rating
organization", as such term is defined for purposes of Rule 436(g)(2)
under the Securities Act;
(c) since the respective dates as of which information is
given in the Offering Memorandum, there shall not have been any change
in the financial condition of the Company or of the Guarantor and its
subsidiaries, taken as a whole, or in the earnings, affairs or business
prospects of the Company or of the Guarantor and its subsidiaries,
taken as a whole, otherwise than as set forth or contemplated in the
Offering Memorandum as at the date hereof, the effect of which is, in
the judgment of the Representatives, so material and adverse as to make
it impracticable or inadvisable to proceed with the offering or the
delivery of the Securities on the Closing Date on the terms and in the
manner contemplated in the Offering Memorandum;
(d) the Representatives shall have received on and as of
the Closing Date a certificate of the President, any Vice President,
the Treasurer, any Assistant Treasurer or the Associate General Counsel
of the Company in which such officers shall state that, to the best of
their knowledge after reasonable investigation, the representations and
warranties of the Company in this Agreement are true and correct as if
made at and as of the Closing Date, that the Company has complied in
all material respects with all agreements and satisfied all conditions
on its part to be performed or satisfied hereunder at or prior to the
Closing Date and that, since the respective dates as of which
information is given in the Offering Memorandum, there has been no
material adverse change in the financial condition or results of
operations of the Company, or, to the best knowledge of the Company, of
Qwest, and its subsidiaries, taken as a whole, except as set forth in
or contemplated by the Offering Memorandum as at the date hereof;
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(e) the Representatives shall have received on and as of
the Closing Date a certificate of the Chief Executive Officer, the
President, any Vice President, the Treasurer, any Assistant Treasurer,
or the Associate General Counsel of the Guarantor in which such
officers shall state that, to the best of their knowledge after
reasonable investigation, the representations and warranties of the
Guarantor in this Agreement are true and correct as if made at and as
of the Closing Date, that the Guarantor has complied in all material
respects with all agreements and satisfied all conditions on its part
to be performed or satisfied hereunder at or prior to the Closing Date
and that, since the respective dates as of which information is given
in the Offering Memorandum, there has been no material adverse change
in the financial condition or results of operations of the Guarantor
and its subsidiaries, taken as a whole, except as set forth in or
contemplated by the Offering Memorandum;
(f) Holme Roberts & Owen LLP shall have furnished to the
Initial Purchasers their written opinion, dated the Closing Date, in
form and substance satisfactory to the Initial Purchasers, to the
effect that:
(i) The Company is a corporation duly
incorporated, and is validly existing and in good standing
under the laws of the State of Colorado, with corporate power
to own, lease and operate its properties and to carry on its
business as now being conducted.
(ii) The execution, delivery and performance of
this Agreement have been duly authorized by all necessary
corporate action on the part of the Company, and this
Agreement has been duly executed and delivered by the Company.
(iii) The execution, delivery and performance of
the Indenture has been duly authorized by all necessary
corporate action on the part of the Company, and the Indenture
has been duly executed and delivered by the Company.
(iv) The Registration Rights Agreement has been
duly authorized by all necessary corporate action on the part
of the Company, and the Registration Rights Agreement has been
duly executed and delivered by the Company.
In rendering such opinion, such counsel may rely as to matters
of fact, to the extent such counsel deems proper, on certificates of
responsible officers of the Company and of public officials
The opinion of Holme Roberts & Owen LLP described above shall
be rendered to the Initial Purchasers at the request of the Company and
shall so state therein.
12
<PAGE> 13
(g) O'Melveny & Myers LLP shall have furnished to the
Initial Purchasers their written opinion, dated the Closing Date, in
form and substance satisfactory to the Initial Purchasers, to the
effect that:
(i) The Guarantor is a corporation duly
incorporated, and is validly existing in good standing under
the laws of the State of Delaware, with corporate power to
own, lease and operate its properties and to carry on its
business as described in the Offering Memorandum.
(ii) The execution, delivery and performance of
the Indenture have been duly authorized by all necessary
corporate action on the part of the Guarantor, and the
Indenture has been duly executed and delivered by the
Guarantor.
(iii) The execution, delivery and performance of
this Agreement and the Registration Rights Agreement have been
duly authorized by all necessary corporate action on the part
of the Guarantor, and this Agreement and the Registration
Rights Agreement have been duly executed and delivered by the
Guarantor.
(iv) The Indenture constitutes the legally valid
and binding obligation of each of the Company and the
Guarantor, enforceable against each of the Company and the
Guarantor in accordance with its terms, except as may be
limited by bankruptcy, insolvency, reorganization, moratorium
or similar laws relating to or affecting creditor's rights
generally (including, without limitation, fraudulent
conveyance laws) and by general principles of equity,
including, without limitation, concepts of materiality,
reasonableness, good faith and fair dealing and the possible
unavailability of specific performance or injunctive relief,
regardless of whether considered in a proceeding in equity or
at law.
(v) The Securities, when duly executed and
authenticated in the manner contemplated by the Indenture and
issued and delivered to the Initial Purchasers against payment
therefor in accordance with the provisions hereof, will be
legally valid and binding obligations of the Company entitled
to the benefits of the Indenture, enforceable against the
Company in accordance with their terms, except as may be
limited by bankruptcy, insolvency, reorganization, moratorium
or similar laws relating to or affecting creditor's rights
generally (including, without limitation, fraudulent
conveyance laws), and by general principles of equity
including, without limitation, concepts of materiality,
reasonableness, good faith and fair dealing and the possible
unavailability of specific performance or injunctive relief,
regardless of whether considered in a proceeding in equity or
at law.
(vi) The Guarantees, when duly executed in the
manner contemplated by the Indenture and issued and delivered
to the Initial Purchasers in
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<PAGE> 14
accordance with the provisions hereof, will be legally valid
and binding obligations of the Guarantor, enforceable
against the Guarantor in accordance their terms, except as
may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws relating to or affecting
creditor's rights generally (including, without limitation,
fraudulent conveyance laws), and by general principles of
equity including, without limitation, concepts of
materiality, reasonableness, good faith and fair dealing and
the possible unavailability of specific performance or
injunctive relief, regardless of whether considered in a
proceeding in equity or at law.
(vii) The Exchange Notes (as defined in the
Registration Rights Agreement), when duly executed in the
manner contemplated in the Indenture and issued and delivered
in exchange for the Securities in the manner contemplated in
the Registration Rights Agreement, will be legally valid and
binding obligations of the Company, enforceable against the
Company in accordance with their terms, except as may be
limited by bankruptcy, insolvency, reorganization, moratorium
or similar laws relating to affecting creditors rights
generally (including, without limitation, fraudulent
conveyance laws), and by general principles of equity
including, without limitation, concepts of materiality,
reasonableness, good faith and fair dealing and the possible
unavailability of specific performance or injunctive relief,
regardless of whether considered in a proceeding in equity or
at law.
(viii) The Exchange Guarantees (as defined in the
Registration Rights Agreement), when duly executed in the
manner contemplated in the Indenture and issued and delivered
in the manner contemplated in the Registration Rights
Agreement, will be legally valid and binding obligations of
the Guarantor, enforceable against the Guarantor in accordance
with their terms, except as may be limited by bankruptcy,
insolvency, reorganization, moratorium or similar laws
relating to or effecting creditors rights generally
(including, without limitation, fraudulent conveyance laws),
and by general principles of equity including, without
limitation, concepts of materiality, reasonableness, good
faith and fair dealing and the possible unavailability of
specific performance or injunctive relief, regardless of
whether considered in a proceeding in equity or at law.
(ix) The Registration Rights Agreement
constitutes the legally valid and binding obligation of the
Company and the Guarantor, enforceable against the Company and
the Guarantor in accordance with its terms, except as may be
limited by bankruptcy, insolvency, reorganization, moratorium
or similar laws relating to or affecting creditor's rights
generally (including, without limitation, fraudulent
conveyance laws) and by general principles of equity,
including, without limitation, concepts of materiality,
reasonableness, good faith and fair dealing and the possible
unavailability of specific performance or injunctive relief,
regardless of whether considered in a proceeding in equity or
at law, and except that no opinion is
14
<PAGE> 15
expressed with respect to the provisions contained in
Section 4 of the Registration Rights Agreement.
(x) No order, consent, permit or approval of or
filing with any federal governmental authority is required on
the part of the Company or the Guarantor for the execution and
delivery of this Agreement, the Indenture or the issuance and
sale of the Securities and the Guarantees to the Initial
Purchasers pursuant to the terms of this Agreement, except
such as may be required under applicable blue sky or state
securities laws.
(xi) The statements in the Offering Memorandum
under the headings "Description of Notes", "Exchange Offer;
Registration Rights" and "Notice to Investors", insofar as
they summarize provisions of the Indenture or the Securities
or constitute a summary of certain provisions of the documents
referred to therein, fairly summarize the matters referred to
therein.
(xii) The Securities satisfy the requirement set
forth in Rule 144A(d)(3) under the Securities Act.
(xiii) Based upon the representations, warranties
and agreements of the Company and the Guarantor in Sections
4(p), 4(q), 4(r), 5(m), 5(n) and 6(a) of this Agreement and of
the Initial Purchasers in Section 2 of this Agreement and on
the truth and accuracy of the representations and agreements
deemed to be made by the purchasers of the Securities
contained in the Offering Memorandum, it is not necessary in
connection with the offer, sale and delivery of the Securities
to the Initial Purchasers under this Agreement or in
connection with the initial resale of such Securities by the
Initial Purchasers in accordance with Section 2 of this
Agreement to register the Securities under the Securities Act
or to qualify the Indenture under the Trust Indenture Act;
provided, however, that such counsel need not express any
opinion with respect to the conditions under which the
Securities may be further resold.
(xiv) The documents incorporated by reference in
the Offering Memorandum, on the respective dates they were
filed, appeared on their face to comply in all material
respects with the requirements as to form for reports on Form
10-K, Form 10-Q and Form 8-K, as the case may be, under the
Securities Exchange Act of 1934, as amended, and Form S-4
under the Securities Act, and the related rules and
regulations in effect at the respective dates of their
filings, except that such counsel need express no opinion
concerning the financial statements and other financial
information contained or incorporated by reference therein.
In rendering such opinion, such counsel may rely as to matters
of fact, to the extent such counsel deems proper, on certificates of
responsible officers of the Company and the Guarantor and of public
officials. Such counsel may also rely as to matters of Colorado law
upon the opinion of Holme Roberts & Owen LLP
15
<PAGE> 16
without independent verification. Such counsel need express no
opinion as to matters relating to the Federal Communications
Commission or any state public utilities commission or similar
authority for the Company or the Guarantor, as applicable.
In addition, such counsel may state that in connection with
such counsel's participation in conferences in connection with the
preparation of the Offering Memorandum, such counsel has not
independently verified the accuracy, completeness or fairness of the
statements contained or incorporated therein, and the limitations
inherent in the examination made by such counsel and the knowledge
available to such counsel are such that such counsel is unable to
assume, and does not assume, any responsibility for such accuracy,
completeness or fairness (except as otherwise specifically stated in
paragraph (xii) above). However, such counsel shall state that on the
basis of such counsel's review of the Offering Memorandum and the
documents incorporated by reference therein and their participation in
conferences in connection with the preparation of the Offering
Memorandum, such counsel does not believe that the Offering Memorandum
and the documents incorporated therein, considered as a whole, as of
its issue date or on the date of the opinion, contained any untrue
statement of a material fact or omitted to state a material fact
necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading. However, such
counsel need express no opinion or belief as to the financial
statements and other financial information contained or incorporated by
reference in the Offering Memorandum or in the documents incorporated
therein by reference.
Such opinion may state that it does not address the impact on
the opinions contained therein of any litigation or ruling relating to
the divestiture by American Telephone and Telegraph Company of
ownership of its operating telephone companies (the "DIVESTITURE").
The opinion of O'Melveny & Myers LLP described above shall be
rendered to the Initial Purchasers at the request of the Company and
shall so state therein.
(h) Yash A. Rana, Esq., Associate General Counsel for the
Company and the Guarantor shall have furnished to the Initial
Purchasers his written opinion, dated the Closing Date, in form and
substance satisfactory to the Initial Purchasers, to the effect that:
(i) The execution, delivery and performance of
this Agreement and the Registration Rights Agreement have been
duly authorized by all necessary corporate action on the part
of the Guarantor, and this Agreement has been duly executed
and delivered by the Guarantor.
(ii) All state regulatory consents, approvals,
authorizations or other orders (except as to the state
securities or blue sky laws, as to which such counsel need
express no opinion) legally required for the execution of the
Indenture and the issuance and sale of the Securities and
Guarantees to the
16
<PAGE> 17
Initial Purchasers pursuant to the terms of this Agreement
have been obtained; provided that such counsel may rely on
opinions of local counsel satisfactory to such counsel.
(iii) To such counsel's knowledge, there is not
pending or threatened any action, suit, proceeding, inquiry or
investigation to which the Company, the Guarantor or any
subsidiary of the Guarantor is a party or to which the assets,
properties or operations of the Company, the Guarantor or any
subsidiary of the Guarantor is subject, before or by any court
or governmental agency or body, domestic or foreign, which (a)
might reasonably be expected to result in a Material Adverse
Effect, or (b) might reasonably be expected to materially and
adversely affect the consummation by the Company or the
Guarantor of the transactions contemplated by this Agreement,
the Registration Rights Agreement or the Securities or the
Indenture or the performance by the Company or the Guarantor
of their respective obligations hereunder or thereunder.
(iv) The execution, delivery and performance of
this Agreement and the Registration Rights Agreement by the
Company and the Guarantor will not (A) violate the charter or
bylaws of the Company or the Guarantor, or (B) violate, breach
or result in a default under any material contract, indenture,
mortgage, loan agreement, note, lease or other material
agreement known to such counsel; provided that such counsel
need express no opinion as to the effect of the Company's or
Guarantor's performance of its obligations under this
Agreement or the Registration Rights Agreement on the
compliance by the Company or the Guarantor with financial
covenants in any such contract, indenture, mortgage, loan
agreement, note, lease or other agreement.
(v) To such counsel's knowledge, neither the
Company, the Guarantor nor any of its subsidiaries is in
violation of its charter or bylaws.
Such counsel may state that is does not address the impact of
the opinions contained therein on any litigation or ruling relating to
the Divestiture. Such counsel need express no opinion with respect to
matters relating to the Federal Communications Commission or state
public utilities commissions for the Company or the Guarantor, as
applicable.
(i) Hogan & Hartson shall have furnished to the Initial
Purchasers their written opinion, dated the Closing Date, in form and
substance satisfactory to the Initial Purchasers, to the effect that no
consent, approval, authorization or other action by, or filing or
registration with, any federal or state government authority is
required in connection with the execution and delivery by the Company
or the Guarantor of this Agreement or the issuance and sale of the
Securities to the Initial Purchasers pursuant to the terms of this
Agreement.
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<PAGE> 18
(j) on the date of the issuance of the Offering
Memorandum and also on the Closing Date, Arthur Andersen LLP and KPMG
LLP shall have furnished to the Initial Purchasers letters, dated the
respective dates of delivery thereof, in form and substance
satisfactory to the Representatives, containing statements and
information of the type customarily included in accountants "comfort
letters" to underwriters with respect to the financial statements and
certain financial information contained in the Offering Memorandum;
(k) the Initial Purchasers shall have received on and as
of the Closing Date an opinion of Brown & Wood LLP, counsel to the
Initial Purchasers, with respect to the validity of the Indenture and
the Securities, and such other related matters as the Initial
Purchasers may reasonably request, and such counsel shall have received
such papers and information as they may reasonably request to enable
them to pass upon such matters;
(l) the Initial Purchasers shall have received prior to
the Closing Date a copy of the Registration Rights Agreement, in the
form and substance satisfactory to the Initial Purchasers, duly
executed by the Company and the Guarantor, and the Registration Rights
Agreement shall be in full force and effect at the Closing Date; and
(m) on or prior to the Closing Date the Company shall
have furnished to the Initial Purchasers such further certificates and
documents as the Initial Purchasers shall reasonably request.
7. (a) The Company and the Guarantor jointly and severally agree to
indemnify and hold harmless each Initial Purchaser against any losses, claims,
damages or liabilities, joint or several, to which such Initial Purchaser may
become subject, as incurred, under the Securities Act, the Exchange Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions
in respect thereof) arise out of or are based upon any untrue statement or
alleged untrue statement of any material fact contained in the Preliminary
Offering Memorandum or the Offering Memorandum or any amendment or supplement
thereto, or arise out of or are based upon the omission or alleged omission to
state therein a material fact required to be stated therein or necessary to
make the statements therein, in the light of the circumstances under which
they were made, not misleading, and will reimburse each Initial Purchaser, as
incurred, for any legal or other expenses reasonably incurred by such Initial
Purchaser in connection with investigating or defending any such loss, claim,
damage, liability or action or amounts paid in settlement of any litigation or
investigation or proceeding related thereto if such settlement is effected
with the written consent of the Company and the Guarantor; PROVIDED, HOWEVER,
that the Company and the Guarantor will not be liable in any such case to the
extent that any such loss, claim, damage or liability arises out of or is
based upon any untrue statement or alleged untrue statement or omission or
alleged omission made in any of such documents in reliance upon and in
conformity with written information furnished to the Company or the Guarantor
by any Initial Purchaser, or on behalf of any Initial Purchaser by the
Representatives, specifically for use therein; and PROVIDED, FURTHER, that
with respect to any untrue statement or omission or alleged untrue statement
or omission made in the Preliminary Offering Memorandum, the
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<PAGE> 19
indemnity agreement contained in this subsection (a) shall not inure to the
benefit of any Initial Purchaser from whom the person asserting any such
losses, claims, damages or liabilities purchased the Securities concerned, to
the extent that any such loss, claim, damage or liability of such Initial
Purchaser results from the fact that a copy of the Offering Memorandum
(excluding material incorporated therein by reference) was not delivered to
such person, if such Offering Memorandum corrected any such untrue statement
or omission or alleged untrue statement or omission.
(b) Each Initial Purchaser will indemnify and hold harmless the
Company and the Guarantor against any losses, claims, damages or liabilities
to which the Company or the Guarantor may become subject, as incurred, under
the Securities Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon any
untrue statement or alleged untrue statement of any material fact contained in
the Preliminary Offering Memorandum or the Offering Memorandum or any
amendment or supplement thereto, or arise out of or are based upon the
omission or the alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements therein, in the light of
the circumstances under which they were made, not misleading, in each case to
the extent, but only to the extent, that such untrue statement or alleged
untrue statement or omission or alleged omission was made in reliance upon and
in conformity with written information furnished to the Company or the
Guarantor by such Initial Purchaser, or on behalf of such Initial Purchaser by
the Representatives, specifically for use therein, and will reimburse the
Company and the Guarantor, as incurred, for any legal or other expenses
reasonably incurred by the Company and the Guarantor in connection with
investigating or defending any such loss, claim, damage, liability or action.
(c) Promptly after receipt by an indemnified party under this
Section 7 of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against the indemnifying
party under this Section 7, notify the indemnifying party of the commencement
thereof; but the omission so to notify the indemnifying party will not relieve
it from any liability which it may have to any indemnified party otherwise
than under this Section 7. In case any such action is brought against any
indemnified party, and it notifies the indemnifying party of the commencement
thereof, the indemnifying party will be entitled to participate therein and,
to the extent that it may wish, jointly with any other indemnifying party
similarly notified, to assume the defense thereof, with counsel satisfactory
to such indemnified party (who shall not, except with the consent of the
indemnified party, be counsel to the indemnifying party), and after notice
from the indemnifying party to such indemnified party of its election so to
assume the defense thereof, the indemnifying party will not be liable to such
indemnified party under this Section 7 for any legal or other expenses
subsequently incurred by such indemnified party in connection with the defense
thereof other than reasonable costs of investigation. The indemnifying party
or parties shall not be liable under this Agreement with respect to any
settlement made by any indemnified party or parties without prior written
consent by the indemnifying party or parties to such settlement.
(d) If the indemnification provided for in this Section 7 is
unavailable or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above, then
19
<PAGE> 20
each indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of the losses, claims, damages or liabilities
referred to in subsection (a) or (b) above, (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company and the
Guarantor on the one hand and the Initial Purchasers on the other from the
offering of the Securities or (ii) if the allocation provided by clause (i)
above is not permitted by applicable law, in such proportion as is appropriate
to reflect not only the relative benefits referred to in clause (i) above but
also the relative fault of the Company and the Guarantor on the one hand and
the Initial Purchasers on the other in connection with the statements or
omissions which resulted in such losses, claims, damages or liabilities as
well as any other relevant equitable considerations. The relative benefits
received by the Company and the Guarantor on the one hand and the Initial
Purchasers on the other shall be deemed to be in the same proportion as the
total net proceeds from the offering (before deducting expenses) received by
the Company bear to the total discounts and commissions received by the
Initial Purchasers. The relative fault shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company and the Guarantor or the
Initial Purchasers and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such untrue statement or
omission. The amount paid by an indemnified party as a result of the losses,
claims, damages or liabilities referred to in the first sentence of this
subsection (d) shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any action or claim which is the subject of this subsection (d).
Notwithstanding the provisions of this subsection (d), no Initial Purchaser
shall be required to contribute any amount in excess of the amount by which
the total price at which the Securities purchased by it were offered exceeds
the amount of any damages which such Initial Purchaser has otherwise been
required to pay by reason of such untrue or alleged untrue statement or
omission or alleged omission. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act) shall be entitled
to contribution from any person who was not guilty of such fraudulent
misrepresentation. The Initial Purchasers' obligations in this subsection (d)
to contribute are several in proportion to the respective principal amount of
the Securities set forth opposite their names in Schedule I hereto, and not
joint.
(e) The obligations of the Company and the Guarantor under this
Section 7 shall be in addition to any liability which the Company or the
Guarantor may otherwise have and shall extend, upon the same terms and
conditions, to each person, if any, who controls any Initial Purchaser within
the meaning of the Securities Act or the Exchange Act; and the obligations of
the Initial Purchasers under this Section 7 shall be in addition to any
liability which the respective Initial Purchasers may otherwise have and shall
extend, upon the same terms and conditions, to each person, if any, who
controls the Company or the Guarantor within the meaning of the Securities Act
or the Exchange Act.
The indemnity and contribution agreements contained in this Section 7
and the representations and warranties of the Company set forth in this
Agreement shall remain operative and in full force and effect regardless of
(i) any termination of this Agreement, (ii) any investigation made by or on
behalf of any Initial Purchaser or any person
20
<PAGE> 21
controlling any Initial Purchaser or by or on behalf of the Company or the
Guarantor or any person controlling the Company or the Guarantor and (iii)
acceptance of and payment for any of the Securities.
8. Notwithstanding anything herein contained, this Agreement may be
terminated in the absolute discretion of the Initial Purchasers, by notice
given to the Company and the Guarantor, if after the execution and delivery of
this Agreement and prior to the Closing Date (i) trading generally shall have
been suspended or materially limited on or by, as the case may be, any of the
New York Stock Exchange, the American Stock Exchange, the Nasdaq National
Market, the Chicago Board Options Exchange, the Chicago Mercantile Exchange or
the Chicago Board of Trade, (ii) trading of any securities of or guaranteed by
the Company or the Guarantor shall have been suspended on any exchange or in
any over-the-counter market, (iii) a general moratorium on commercial banking
activities in New York shall have been declared by either Federal or New York
State authorities, or (iv) there shall have occurred any outbreak or
escalation of hostilities or any change in financial markets or any calamity
or crisis that, in the judgment of the Initial Purchasers, is material and
adverse and which, in the judgment of the Initial Purchasers, makes it
impracticable to market the Securities on the terms and in the manner
contemplated in the Offering Memorandum.
9. This Agreement shall become effective upon the execution and delivery
hereof by the parties hereto.
10. If, on the Closing Date any one or more of the Initial Purchasers
shall fail or refuse to purchase Securities which it or they have agreed to
purchase hereunder on such date, and the aggregate principal amount of
Securities which such defaulting Initial Purchaser or Initial Purchasers
agreed but failed or refused to purchase is not more than one-tenth of the
aggregate principal amount of the Securities to be purchased on such date,
the other Initial Purchasers shall be obligated severally in the proportions
that the principal amount of Securities set forth opposite their respective
names in Schedule I bears to the aggregate principal amount of Securities set
forth opposite the names of all such non-defaulting Initial Purchasers, or in
such other proportions as the Initial Purchasers may specify, to purchase the
Securities which such defaulting Initial Purchaser or Initial Purchasers
agreed but failed or refused to purchase on such date; PROVIDED that in no
event shall the principal amount of Securities that any Initial Purchaser has
agreed to purchase pursuant to Section 1 be increased pursuant to this
Section 10 by an amount in excess of one-tenth of such principal amount of
Securities without the written consent of such Initial Purchaser. If, on the
Closing Date any Initial Purchaser or Initial Purchasers shall fail or refuse
to purchase Securities which it or they have agreed to purchase hereunder on
such date, and the aggregate principal amount of Securities with respect to
which such default occurs is more than one-tenth of the aggregate principal
amount of Securities to be purchased on such date, and arrangements
satisfactory to the Initial Purchasers, the Company and the Guarantor for the
purchase of such Securities are not made within 36 hours after such default,
this Agreement shall terminate without liability on the part of any
non-defaulting Initial Purchaser, the Company or the Guarantor. In any such
case either the Initial Purchasers, the Company or the Guarantor shall have
the right to postpone the Closing Date, but in no event for longer than seven
days, in order that the required changes, if any,
21
<PAGE> 22
in the Offering Memorandum or in any other documents or arrangements may be
effected. Any action taken under this paragraph shall not relieve any
defaulting Initial Purchaser from liability in respect of any default of such
Initial Purchaser under this Agreement.
11. If this Agreement shall be terminated by the Initial Purchasers, or
any of them, because of any failure or refusal on the part of the Company or
the Guarantor to comply with the terms or to fulfill any of the conditions of
this Agreement, or if for any reason the Company or the Guarantor shall be
unable to perform its obligations under this Agreement or any condition of the
Initial Purchasers' obligations cannot be fulfilled, (i) the Company and the
Guarantor shall remain responsible for the expenses to be paid or reimbursed
by them pursuant to Section 5(j) and (ii), except in the event this Agreement
is terminated pursuant to clauses (i), (iii) or (iv) of Section 8, the Company
and the Guarantor agree to reimburse the Initial Purchasers or such Initial
Purchasers as have so terminated this Agreement with respect to themselves,
severally, for the out-of-pocket expenses reasonably incurred by such Initial
Purchasers in connection with this Agreement or the offering contemplated
hereunder, not exceeding $75,000, and for the fees and disbursements of their
counsel.
12. This Agreement shall inure to the benefit of and be binding upon the
Company, the Guarantor, the Initial Purchasers, any controlling persons
referred to herein and their respective successors and assigns. Nothing
expressed or mentioned in this Agreement is intended or shall be construed to
give any other person, firm or corporation any legal or equitable right,
remedy or claim under or in respect of this Agreement or any provision herein
contained. No purchaser of Securities from any Initial Purchaser shall be
deemed to be a successor by reason merely of such purchase.
13. All notices and other communications hereunder shall be in writing
and shall be deemed to have been duly given if mailed or transmitted by any
standard form of telecommunication. Notices to the Initial Purchasers shall be
given to the Initial Purchasers c/o Salomon Smith Barney, Inc., 388 Greenwich
Street, New York, New York 10013 (telefax: (212) 316-5711); Attention: Office
of the General Counsel. Notices to the Company and the Guarantor shall be
given to each of them at 1801 California Street, Denver, Colorado 80202
(telefax: (303) 896-6468); Attention: Sean P. Foley, with a copy to General
Counsel (telefax: (303) 296-5974).
14. This Agreement may be signed in counterparts, each of which shall be
an original and all of which together shall constitute one and the same
instrument.
15. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO THE CONFLICTS OF
LAWS PROVISIONS THEREOF.
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<PAGE> 23
If the foregoing is in accordance with your understanding, please sign
and return counterparts hereof.
Very truly yours,
QWEST CAPITAL FUNDING, INC.
By: /s/ YASH RANA
-------------------------------------
Name: Yash Rana
Title: Associate General Counsel
QWEST COMMUNICATIONS INTERNATIONAL INC.
By: /s/ YASH RANA
-------------------------------------
Name: Yash Rana
Title: Associate General Counsel
Accepted: August 16, 2000
SALOMON SMITH BARNEY INC.
LEHMAN BROTHERS INC.
By: SALOMON SMITH BARNEY INC.
By: /s/ ALAN B. MITCHELL
-----------------------
Name: Alan B. Mitchell
Title: Vice President
For themselves and as Representatives of the
other Initial Purchasers named in Schedule I hereto.
23
<PAGE> 24
SCHEDULE I
<TABLE>
<CAPTION>
Principal Amount Principal Amount
of 2006 Notes of 2010 Notes
Initial Purchaser To Be Purchased To Be Purchased
----------------- ---------------- ----------------
<S> <C> <C>
Salomon Smith Barney Inc............................................. $ 384,050,000 $ 634,375,000
Lehman Brothers Inc.................................................. 384,050,000 634,375,000
J.P. Morgan Securities Inc........................................... 56,250,000 78,750,000
Banc of America Securities LLC....................................... 56,250,000 78,750,000
Chase Securities Inc................................................. 56,250,000 78,750,000
Donaldson, Lufkin & Jenrette Securities Corporation.................. 138,150,000 0
Goldman, Sachs & Co.................................................. 56,250,000 78,750,000
Merrill Lynch, Pierce, Fenner & Smith
Incorporated............................................. 56,250,000 78,750,000
ABN AMRO Incorporated................................................ 4,807,693 6,730,770
Banc One Capital Markets, Inc........................................ 4,807,693 6,730,770
Commerzbank Capital Markets Corp..................................... 4,807,693 6,730,770
Deutsche Bank Securities Inc......................................... 4,807,693 6,730,769
First Union Securities, Inc.......................................... 4,807,692 6,730,769
FleetBoston Robertson Stephens Inc................................... 4,807,692 6,730,769
McDonald Investments, Inc............................................ 4,807,692 6,730,769
Mellon Financial Markets, LLC........................................ 4,807,692 6,730,769
RBC Dominion Securities Corporation.................................. 4,807,692 6,730,769
U.S. Bancorp Piper Jaffray Inc....................................... 4,807,692 6,730,769
Utendahl Capital Partners, L.P....................................... 4,807,692 6,730,769
Wells Fargo Brokerage Securities, LLC................................ 4,807,692 6,730,769
The Williams Capital Group, L.P...................................... 4,807,692 6,730,769
---------------- ----------------
Total $ 1,250,000,000 $1,750,000,000
---------------- ----------------
</TABLE>
Sch I-1
